/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/140313.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Thursday, March 13, 2014, Vol. 15, No. 51 Headlines B R A Z I L OGX PETROLEO: To Get $125 Million From Creditors C A Y M A N I S L A N D S BELIZE MORTGAGE: Shareholders' Final Meeting Set for March 18 CORRIENTES STRATEGY: Members' Final Meeting Set for March 17 GG CURRENCY: Shareholders' Final Meeting Set for April 30 GOMA: Members' Final Meeting Set for March 17 JAPAN SPECIAL: Members' Final Meeting Set for March 18 MSR ASIA: Members' Final Meeting Set for March 18 PHOENIX HOLDING: Members' Final Meeting Set for March 18 QCON CAYMAN: Members' Final Meeting Set for March 17 SCM PRIVATE: Shareholders' Final Meeting Set for March 31 ZZ4 LTD: Creditors' Proofs of Debt Due March 17 D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Eyes US$2.3 Billion With Bond, Credit DOMINICAN REP: Growth Topped 5% in Jan; Inflation Below Expected J A M A I C A JAMAICA: BOJ Says Commercial Banks' Bad Loans Ratio on the Rise JAMAICA: Thousands of Sugar Workers Threaten Industrial Action M E X I C O CONSUBANCO S.A.: S&P Affirms 'BB-' LT IDR; Outlook Stable FINANCIERA INDEPENDENCIA: Fitch Keeps 'BB-' LT IDR; Outlook Stable GEO SAB: Mexican Home Builder to File for Bankruptcy PRESTACIONES FINMART: Fitch Affirms 'B+/RR4' Rating on 8.5% Bonds P E R U INTERBANK: Moody's Assigns Ba1 Debt Rating on $300MM Sub. Notes P U E R T O R I C O PUERTO RICO: Moody's Lifts "Provisional" Designation on Ba2 Rating - - - - - =========== B R A Z I L =========== OGX PETROLEO: To Get $125 Million From Creditors ------------------------------------------------ Emily Glazer and Luciana Magalhaes, writing for The Wall Street Journal, reported that creditors of the distressed oil firm of former Brazilian billionaire Eike Batista will invest $125 million in the company, allowing the firm to continue operations while it seeks a way out of bankruptcy, according to people familiar the situation. According to the report, the money for Oleo e Gas Participacoes SA, formerly known as OGX Petroleo e Gas Participacoes SA, will be provided in the form of a so-called debtor in possession loan, one of the people said. It is the first part of a $215 million that some of the firm's largest creditors earlier this year agreed to inject in the company in exchange for equity, another person said. In mid-February, OGP filed a financial plan to emerge from bankruptcy, the report recalled. The company's creditors can oppose the plan but, if they don't, the recovery plan will be automatically approved, according to Marcio Costa of the law firm Sergio Bermudes, which represents the oil company. As of March 12, none of the creditors had objected to the recovery plan, Mr. Costa said, who also noted the deadline for objections hasn't been set, the report related. A group of large bondholders, including Pacific Management Investment Co., has agreed to exchange some $5.8 billion of debts owed by OGP for shares equivalent to 90% of the company, the report further related. Mr. Batista, meanwhile, agreed to have his stake in the firm reduced from 50.2% to 5.02%. About OGX Petroleo Based in Rio de Janeiro, Brazil, OGX Petroleo e Gas Participacoes S.A., now known as Oleo e Gas, is an independent exploration and production company with operations in Latin America. OGX filed for bankruptcy in a business tribunal in Rio de Janeiro on Oct. 30, 2013, case number 0377620-56.2013.8.19.0001. The bankruptcy filing puts $3.6 billion of dollar bonds into default in the largest corporate debt debacle on record in Latin America. The filing by the oil company that transformed Eike Batista into Brazil's richest man followed a 16-month decline that wiped out more than $30 billion of his personal fortune. The filing, which in Brazil is called a judicial recovery, follows months of negotiations to restructure the dollar bonds, in which OGX sought to convert debt to equity and secure as much as $500 million in new funds. OGX said Oct. 29 that the talks concluded without an agreement. The company's cash fell to about $82 million at the end of September, not enough to sustain operations further than December ========================== C A Y M A N I S L A N D S ========================== BELIZE MORTGAGE: Shareholders' Final Meeting Set for March 18 ------------------------------------------------------------- The shareholders of Belize Mortgage Company 2002-1 will hold their final meeting on March 18, 2014, at 9:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Mourant Ozannes Cayman Liquidators Limited 94 Solaris Avenue, Camana Bay P.O. Box 1348 Grand Cayman KY1-1108 Cayman Islands CORRIENTES STRATEGY: Members' Final Meeting Set for March 17 ------------------------------------------------------------ The members of Corrientes Strategy Fund will hold their final meeting on March 17, 2014, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Appleby Trust (Cayman) Ltd Name: George Bashforth Telephone: +1 (345) 949 4900 c/o Appleby Trust (Cayman) Ltd. 75 Fort Street P.O. Box 1350, George Town Grand Cayman KY1-1108 Cayman Islands GG CURRENCY: Shareholders' Final Meeting Set for April 30 --------------------------------------------------------- The shareholders of GG Currency Partners Limited will hold their final meeting on April 30, 2014, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Summit Management Limited c/o David Egglishaw Telephone: (345) 945 7676 Suite # 4-210, Governors Square P.O. Box 32311 Grand Cayman KY1-1209 Cayman Islands GOMA: Members' Final Meeting Set for March 17 --------------------------------------------- The members of Goma will hold their final meeting on March 17, 2014, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Appleby Trust (Cayman) Ltd Name: George Bashforth Telephone: +1 (345) 949 4900 c/o Appleby Trust (Cayman) Ltd. 75 Fort Street P.O. Box 1350, George Town Grand Cayman KY1-1108 Cayman Islands JAPAN SPECIAL: Members' Final Meeting Set for March 18 ------------------------------------------------------ The members of Japan Special Investments Ltd. will hold their final meeting on March 18, 2014, at 10:20 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Stephen Nelson Telephone: 949-4544 Facsimile: 949-7073 Charles Adams Ritchie & Duckworth Zephyr House, 2nd Floor, 122 Mary Street P.O. Box 709 Grand Cayman KY1-1107 Cayman Islands MSR ASIA: Members' Final Meeting Set for March 18 ------------------------------------------------- The members of MSR Asia Acquisitions I, Inc will hold their final meeting on March 18, 2014, at 10:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Stephen Nelson Telephone: 949-4544 Facsimile: 949-7073 Charles Adams Ritchie & Duckworth Zephyr House, 2nd Floor, 122 Mary Street P.O. Box 709 Grand Cayman KY1-1107 Cayman Islands PHOENIX HOLDING: Members' Final Meeting Set for March 18 -------------------------------------------------------- The members of Phoenix Holding Limited will hold their final meeting on March 18, 2014, at 10:10 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Stephen Nelson Telephone: 949-4544 Facsimile: 949-7073 Charles Adams Ritchie & Duckworth Zephyr House, 2nd Floor, 122 Mary Street P.O. Box 709 Grand Cayman KY1-1107 Cayman Islands QCON CAYMAN: Members' Final Meeting Set for March 17 ---------------------------------------------------- The members of QCON Cayman Ltd. will hold their final meeting on March 17, 2014, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Gene Dacosta Telephone: (345) 814 7765 Facsimile: (345) 945 3902 P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands SCM PRIVATE: Shareholders' Final Meeting Set for March 31 --------------------------------------------------------- The shareholders of SCM Private Equity Company Limited will hold their final meeting on March 31, 2014, at 10:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Delta FS Limited c/o J.Aljadir Telephone: (345) 743 6626 103 South Church St. Harbour Place, 4th Floor P.O. Box 11820, George Town Grand Cayman KY1-1009 Cayman Islands ZZ4 LTD: Creditors' Proofs of Debt Due March 17 ----------------------------------------------- The creditors of ZZ4 Ltd are required to file their proofs of debt by March 17, 2014, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Jan. 30, 2014. The company's liquidator is: Ogier c/o Jo-Anne Maher Telephone: (345) 815-1762 Facsimile: (345) 949-9877 89 Nexus Way, Camana Bay Grand Cayman KY1-9007 Cayman Islands =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Eyes US$2.3 Billion With Bond, Credit --------------------------------------------------------- Dominican Today reports that Dominican Republic's government on March 7 sent two bills to the Senate, one to issue a US$1.5 billion bond and the other for US$781.4 million in local loans. The Presidency seeks to raise the funds to meet its obligations and financing, including government spending and social programs, according to Dominican Today. The report relates that the bond could be offered as a single issue, including combined currencies in dollars and pesos to offer on the money markets. The report notes that the issuance date for each series of the bonds would be stated in the public offer notice and how to register and awarded, depending on the conditions used in foreign markets or in adherence to national law. DOMINICAN REP: Growth Topped 5% in Jan; Inflation Below Expected ---------------------------------------------------------------- Dominican Today reports that central banker Hector Valdez Albizu said the Dominican economy grew more than 5% in January and that projections are positive for this year. The official said the IMF has been assessing the economy's performance and expects the results of the IMF's annual evaluation by next week, according to Dominican Today. Mr. Valdez, Dominican Today notes, expects the report published soon, adding that inflation is below projection and also noted the dollar's relatively stable exchange rate. ============= J A M A I C A ============= JAMAICA: BOJ Says Commercial Banks' Bad Loans Ratio on the Rise --------------------------------------------------------------- RJR News reports that the Bank of Jamaica (BOJ) has revealed that at the end of last year, commercial banks were reporting a higher volume of loans going bad. According to the BOJ, almost one out of every ten dollars loaned by banks was past due at the end of December, according to RJR News. The report relates that was double the rate of one in every 20 dollars at the end of November. At the end of December, commercial bank loans totaled more than J$362 billion, RJR News notes. JAMAICA: Thousands of Sugar Workers Threaten Industrial Action -------------------------------------------------------------- Caribbean360.com reports that more than 4,000 thousand sugar workers have threatened to take industrial action following weeks of failed negotiations involving their unions and the Sugar Producers Federation (SPF) for improved wage and fringe benefits. The three unions representing the workers and the Sugar Producers Federation (SPF) are still at a stalemate in hammering out a wage and fringe benefits agreement as a marathon meeting at the Ministry of Labor ended without a settlement, according to Caribbean360.com. The report notes that SPF has offered to increase wages to 7 percent in year one and 3 percent in the second year. This, however, has been rejected by the unions, the report relates. The report discloses that First Vice President of the University and Allied Workers Union (UAWU) Clifton Grant says the SPF's offer has only served to anger the workers. "The union wants a 13 percent (increase) in the first year for the employees and an 8 and a half percent in the second year. The federation says they are not in a position to change. So we have communicated this to the employees. They are very upset. The feedback that we are receiving is that the workers wanted to take industrial action, but we have asked them to give the Ministry of Labor and the minister and opportunity to try and broker an agreement between the parties," the report quoted Mr. Grant as saying. However, the report notes that SPF is insisting that the industry stands to lose millions during this crop season due to increased international competition. But the unions are insisting that they produce figures for both rum and sugar production to support the prediction, the report says. Another meeting is scheduled be held today, March 13, at the Ministry of Labor. =========== M E X I C O =========== CONSUBANCO S.A.: S&P Affirms 'BB-' LT IDR; Outlook Stable --------------------------------------------------------- Fitch Ratings has affirmed the foreign and local currency long- term Issuer Default Ratings (IDRs) of Consubanco, S.A., Institucion de Banca Multiple (Consubanco) at 'BB-' and the short- term IDRs at 'B'. Consubanco's Viability Rating (VR) is also affirmed at 'bb-' and the national scale ratings at 'A-(mex)' and 'F2(mex)'. The Rating outlook is Stable. Key Rating Drivers Consubanco's IDRs, VR, and national scale ratings are driven by its strong capitalization, sound and recurring profitability driven by ample margins, well-contained provisions and strong efficiency levels, and reasonably sound asset quality and loan loss reserve coverage, which Fitch expects will remain roughly unchanged. However, the ratings also factor in the limited flexibility of its funding structure, though this is gradually improving, the challenging operating and competitive environment in this sector, and the relatively high, though declining, portfolio concentrations by region and employer. In turn, Consubanco's Support Rating (SR) of '5' and the Support Rating Floor (SRF) of 'NF' reflect Fitch's opinion that external support for the bank in case of need, although possible, cannot be relied upon. Rating Sensitivities The IDRs, VR, and national scale ratings would benefit from a material and sustained improvement in the profile and flexibility of Consubanco's financing mix while other financial strengths are maintained. Fitch would consider upgrading these ratings when the vast majority of Consubanco's funding is unsecured, and the ratio of unpledged loans to unsecured funding is at least 90%, while asset and liability tenors are relatively matched, and a comfortable cash flow schedule maintained. These ratings could be negatively affected if asset quality deteriorates to such an extent that operating return on assets (ROA) and/or the core capital ratio fall below 5% or 15%, respectively. Negative developments in political and/or business risks could also affect the ratings. Given the limited systemic importance of the bank and negligible share of retail deposits, Fitch believes that the SR and SRF are unlikely to change in the foreseeable future. Credit Profile Despite its conversion into a bank in 2012, Consubanco remains focused on the traditional business model, as it does not plan in the near future to expand its array of financial products, enter different sectors, nor develop a network of bank branches, although a gradually increasing portion of its funding is expected to be sourced from customer deposits. Consubanco grants loans to public sector employees that explicitly agreed to repay those loans through direct payroll debits, largely mitigating credit risk. These jobs are typically stable and have low turnover ratios, but the relatively lower salaries in the public sector mean few financing alternatives for these individuals, which explain the relatively high interest rates. Unlike most peers, Consubanco's broker-based business is done through fee-based agreements, further enhancing margins and net income. Ample margins, coupled with well-contained credit costs and sound efficiency, are major drivers of a recurring and resilient earnings stream. While the worsening operating environment and increased competition will likely pressure profitability to some extent, Fitch considers that Consubanco will likely maintain robust earnings. Given the payroll deduction mechanism, overall impairments, provisions and charge-offs are relatively low and stable throughout the different phases of the economic cycle. Loans are diversified by borrower, although there are still relatively high concentrations by region and employers, but this is declining rapidly. A gradually enhanced credit process in recent years and ample loan loss reserves are additional mitigating factors for credit risk. Given its exceptionally high profitability and the slowdown in loan growth in previous years, the capital base is ample, despite the resumption of loan growth since 2012. Sound capital is one of Consubanco's key strengths; its equity to assets ratio stood at an adequate 28.7% as of December 2013. Although improving, Fitch considers Consubanco's funding structure as one of its major challenges. Liquidity is comfortable and sustained by sizable and recurring cash flows, but the funding base remains concentrated in few banks. Positively, the banking license has allowed Consubanco to rapidly increase the relative weight of unsecured financing, but the flexibility is still constrained by a limited amount of unpledged loans. While credit risk is low, Fitch considers that Consubanco's exposure to operational, political, and event risk is somewhat higher, common to most companies in this sector. These are related to the proper execution of the agreements with employers, and potential unwillingness of the latter to timely or fully disburse retained collections. The competitive environment is also intensifying rapidly. Fitch has affirmed the following ratings: Consubanco, S.A., Institucion de Banca Multiple: -- Long-term IDR at 'BB-'; -- Short-term IDR at 'B'; -- Long-term local currency IDR at 'BB-'; -- Short-term local currency IDR at 'B'; -- Viability rating at 'bb-'; -- Support rating at '5'; -- Support rating floor at 'NF'; -- Long-term national-scale rating at 'A-(mex)'; -- Short-term national-scale rating at 'F2(mex)'; -- Long-term national-scale rating for local unsecured debt at 'A-(mex)'. The Rating Outlook is Stable. FINANCIERA INDEPENDENCIA: Fitch Keeps 'BB-' LT IDR; Outlook Stable ------------------------------------------------------------------ Fitch Ratings has affirmed the Long-Term foreign and local currency Issuer Default Ratings (IDRs) of Financiera Independencia S.A.B. de C.V. (Findep) at 'BB-', and the Short-Term IDRs at 'B'. National scale ratings have also been affirmed. The Outlook is Stable. KEY RATING DRIVERS The affirmation of Findep's ratings is driven by its sound business franchise in the consumer finance sector, and its adequate funding and liquidity positions. The ratings also reflect strategic actions on underwriting and collection processes implemented for unsecured personal lending, later extended to group lending, which resulted in some improvements on Findep's portfolio quality, profitability and capitalization. The ratings continue to be constrained by Findep's tight capital ratios, with a tangible equity to tangible assets ratio of 13.8% at YE13. Findep has not yet compensated the goodwill generated from the acquisitions of Apoyo Economico Familiar S.A. (AEF) and Finsol S.A. In Fitch's opinion, executed strategic changes have enhanced Findep's ability to continue strengthening its financial performance in the foreseeable future. However, Fitch does not anticipate a return on assets (ROA) to historical levels in the near term (over 10%). Still, broad volumes, ample margins and tightened operational policies, together with AEF, AFI (Apoyo Financiero) and Finsol Brazil's good performance and projected growth, could underpin earnings; although increased competition could continue constraining the speed of the recovery. Capital ratios may only recover gradually and converge toward 18.0% over the next two years. RATING SENSITIVITIES Findep's ratings could be downgraded if: the recently recovered operating ROA weakened to below 2%; the loan charge-off ratio had an unexpected increase above 20%; and/or the tangible equity to tangible assets ratio fell below 12%. A downgrade could also arise from negative changes on its funding profile. Findep's ratings could only benefit from a substantial enhancement of its tangible capital ratios and from a quicker than expected improvement on its overall performance. CREDIT PROFILE Findep is recognized as one of the leaders in the unsecured personal lending sector. It has expanded its geographical and group lending niche presence mainly through the acquisitions of AEF, AFI, and Finsol in Mexico and Brazil. Findep's ability to maintain and gradually increase its bank facilities results in a reasonable wholesale funding mix. Its well-balanced funding structure is made up of bank credit lines, and global and local market debt. Liquidity levels are good for 2014, and are sustained by its loan portfolio's high turnover. Nevertheless, the amount of global debt maturing in 2015 could challenge the entity's capacity to roll it over. The strategic measures undertaken since late 2012, boosted by Findep's strong margins and broad volumes, rapidly reversed 2012's net losses. Profitability levels are sustainable in the medium term, while the entity should be able to continue strengthening its overall financial performance. The enhanced underwriting and collection processes reduced impairments and charges-off to 24% of the total portfolio as of December 2013 (36% YE12). While strategic actions have somewhat reduced delinquency indicators, they still remain high compared to its peers. The entity expects to further improve on the asset quality indicators, and to maintain 100% loan loss reserve coverage. While competition eased somewhat in 2013, the micro lending industry in Mexico continues to be pressured by low entrance barriers and less formal participants that increase the indebtedness of Findep's customer-base. The entity has taken solid steps to adapt its business model to a more competitive environment. The rating actions are as follows: Findep: -- Long-Term foreign and local currency IDRs affirmed at 'BB-'; Outlook Stable; -- Short-Term foreign and local currency IDRs affirmed at 'B'; -- USD200m senior unsecured notes affirmed at 'BB-'; -- National-scale Long-Term rating affirmed at 'A-(mex)'; Outlook Stable; and -- National-scale Short-Term rating affirmed at 'F2(mex)'. Fitch has withdrawn the following rating: National-scale Long-Term rating for local issues of senior unsecured debt (Findep 11), prepaid by Findep on Feb. 27, 2014. GEO SAB: Mexican Home Builder to File for Bankruptcy ---------------------------------------------------- Emily Glazer and Amy Guthrie, writing for The Wall Street Journal, reported that home builder Corporacion Geo SAB is preparing to file for bankruptcy protection in Mexico to restructure a roughly $1.5 billion debt load that has brought its output to a near- standstill, people familiar with the company's plans said. According to the report, Geo, hurt by problems in Mexico's low- income housing sector, is preparing to file a streamlined bankruptcy in a Mexican court. The company is in talks with a creditor group on a $200 million to $300 million loan to fund its restructuring, some of these people said. Geo has been in talks for months with creditors based in Mexico, the U.S. and elsewhere, the people said. The company has negotiated with its bank lenders to reopen construction lines of financing that had been frozen, these people said, the report related. The funding would help Geo undertake more than 20 projects and essentially restart its construction business, they said. Geo is one of three large Mexican home builders, along with Urbi Desarrollos Urbanos SAB and Desarrolladora Homex SA, struggling amid drastic changes in Mexico's housing sector, the report further related. Though questions remain, a Geo bankruptcy filing is the first step in a process that could keep it in business. And if banks, other creditors and government officials support Geo's strategy, other builders may be able to follow the same path and avoid a shutdown. Geo's debt includes just over $700 million in U.S. dollar- denominated bonds as well as loans from some of Mexico's biggest commercial banks, the report said. PRESTACIONES FINMART: Fitch Affirms 'B+/RR4' Rating on 8.5% Bonds ----------------------------------------------------------------- Fitch Ratings has affirmed the international and national-scale ratings of Mexican lender Prestaciones Finmart, S.A.P.I. de C.V., SOFOM, E.N.R. (Finmart). The long-term Rating Outlook has been revised to Positive from Stable. In addition, Fitch has affirmed Finmart's 8.5% bonds due 2015 at 'B+/RR4'. Rating Drivers The Outlook revision to Positive is driven by the sustained improvements in Finmart's profitability, capital adequacy, funding profile, risk concentrations, and franchise, while maintaining sound asset quality metrics and a steadily growing business volume. Finmart's ratings could be upgraded over the next 24 months if these improvements are sustained, while further strengthening its competitive position and containing business risks. Finmart's ratings factor in its favorable business model in terms of credit risk, since loans are granted to stable public sector employees with direct debit to their payrolls. However, the ratings also consider the relatively high operational, political, and reputational risks associated with this sector, as well as the exposure to fierce competition, and the potential for rapidly changing market dynamics. Finmart's ratings also reflect its growing franchise and overall competitive position; sound operating and risk management practices; and improving performance and capital adequacy metrics. Over the past two years, Finmart has materially improved the terms and flexibility of its funding base, which has underpinned a sustained reduction of average funding costs and a material improvement in its core and recurring profitability metrics. The 'B+/RR4' rating on the notes reflects Fitch's opinion that Finmart has enough available earning assets to ensure an average recovery for bondholders in the case of liquidation. This underpins the Recovery Rating of 'RR4' and the alignment of the notes' rating with Finmart's long-term IDR. Rating Sensitivities Finmart's ratings could be upgraded if the flexibility of funding is further improved, with more diversified sources, an increasing portion of more stable financing channels, and a continued shift in the funding mix toward unsecured borrowing. In addition, rating upside could also arise from maintaining asset quality under control, as well as the tangible equity to assets ratio and operating ROA above 25% and 7%, respectively. In turn, the Outlook on Finmart's ratings could be revised to Stable if the recent improvements on earnings and capitalization are not sustained (falling below the aforementioned levels), and/or if the company is not able to materially improve further the flexibility of its funding mix. Downward rating pressure could also arise from asset quality deterioration and/or heightened business risk. The rating of the senior notes will likely remain aligned with Finmart's IDRs, unless the portion of unpledged assets relative to the outstanding unsecured liabilities decreases materially. Credit Profile Finmart, established in 2003, grants personal loans secured by payroll withholdings to unionized public sector employees in Mexico. These employees, federal, state, and municipal governments, often have limited access to financing products, given their relatively lower income and limited credit track record. However, public sector unionized jobs are usually stable and have low turnover ratios. Finmart offers medium-term loans that are repaid in fixed installments. In 2012, EzCorp Inc. (NASDAQ: EZPW), a consumer finance company based in Austin, Texas, acquired 60% of Finmart. Since the acquisition of a majority stake by EZPW, the shareholders have contributed new capital into Finmart for roughly USD35 million. Fitch has affirmed the ratings for Prestaciones Finmart, S.A.P.I. de C.V., SOFOM E.N.R. as follows: -- Long-term foreign and local currency IDRs at 'B+'; -- Short-term foreign and local currency IDRs at 'B'; -- USD30million 8.5% bonds due 2015 at 'B+/RR4'; -- National-scale long-term rating at 'BBB+(mex)'; -- National-scale short-term rating at 'F2(mex)'. The Rating Outlook for the long-term ratings (international- and national-scale) has been revised to Positive from Stable. ======= P E R U ======= INTERBANK: Moody's Assigns Ba1 Debt Rating on $300MM Sub. Notes --------------------------------------------------------------- Moody's Investors Service has assigned a Ba1 foreign currency subordinated debt rating to the US$ 300 million fixed to floating rate Tier II-eligible subordinated notes to be issued by Banco Internacional del Peru S.A.A. (Interbank), due 2029. The outlook on the ratings is stable in line with the outlook on the bank's other ratings. The notes are being issued as redeemable subordinated notes under Article 233 of the Peruvian Banking Law and will be governed by New York State law. The following rating has been assigned: Foreign currency subordinated debt rating: Ba1, stable outlook Ratings Rationale Moody's said that the Ba1 subordinated debt rating is one notch below the bank's baa3 standalone baseline credit assessment (BCA) in line with Moody's methodology for rating junior obligations, and as such does not benefit from systemic support. The new notes are subordinated to all of the bank's senior obligations but are senior in right of payment to the bank's junior subordinated securities. The notes are expected to qualify as Tier II regulatory capital under Peruvian Banking Law. Interbank's D+ BFSR and baa3 BCA reflect the bank's growing earnings capacity and business diversification, as well as its strong core funding base that benefits from its position as Peru's fourth largest bank. Interbank has enhanced its market shares in Peru's increasingly competitive market to become a leader in retail banking, given its strategy to serve the growing middle- income Peruvian consumer and business enterprise segments. The bank has the second largest market share in consumer credit cards and consumer loans overall. Its track record of strong profitability metrics relative to its peers include an ample net interest margin and high operating efficiency despite maintaining the second largest distribution network in Peru. While Interbank's Baa3 long term deposit and senior debt ratings incorporate an assessment of the probability of systemic support for the bank's obligations in case of need due to its important deposit and loan market shares, this assessment does not result in further uplift given Interbank's current ratings levels. Key risk challenges for Interbank include high loan growth particularly in the higher risk retail and consumer segments, a trend that may lead to rapid asset quality deterioration should economic growth slow dramatically. This growth trend is supported by Peru's dynamic economy and future prospects, said Moody's. Interbank has managed its growth well, demonstrating good asset quality metrics that are supported by a strategy of balancing the risks of a higher than average exposure to consumer loans and credit cards, by increasing its proportion of higher quality commercial and residential mortgage lending and limiting its activities in SME and microfinance lending. Margin pressure as a result of competitive and regulatory pressures and a lower interest rate environment is also a risk to the bank's earnings performance. The bank is addressing these pressures through efforts to increase low cost deposits from both retail and commercial sources and a gradual adjustment of its risk-based pricing. The last rating action on Interbank was on 6 March 2014, when Moody's affirmed the bank's D+ BFSR and Baa3 deposit and senior debt ratings and raised the BCA to baa3 from ba1. In that same action, Moody's upgraded the bank's junior subordinated debt to Ba3 (hyb) from B1 (hyb), all with stable outlooks. The principal methodology used in this rating was Global Banks published in May 2013. Based in Lima, Interbank is Peru's fourth largest bank, with PEN 29.9 billion (US$ 10.7 billion) in assets, PEN 2.7 billion in equity, and annual net income of PEN 647 million as of December 31, 2013. Interbank is a direct subsidiary of Intercorp Financial Services Inc. (IFS, formerly Intergroup Financial Services Corp.) (99.3%), an intermediate holding incorporated in Panama that holds the shares of the bank and an insurance company, Interseguro. IFS is a direct subsidiary of Intercorp Peru Ltd. ===================== P U E R T O R I C O ===================== PUERTO RICO: Moody's Lifts "Provisional" Designation on Ba2 Rating ------------------------------------------------------------------ Moody's Investors Service has removed the "provisional" designation from the Ba2 rating assigned to the Commonwealth of Puerto Rico's issuance of $3.5 billion 2014 A General Obligation Bonds. The outlook is negative. Summary Rating Rationale The Ba2 rating was contingent on our assessment of legislation and bond documents for potential inclusion of atypical terms and conditions, as well as completion of the transaction and the amount of proceeds. After our review of available documents and legislation, Moody's believe that the transaction provides for New York legal jurisdiction in the event of litigation related to the bonds. The sale of $3.5 billion has priced and is expected to close next week. Supporting the Ba2 rating is the fact that Puerto Rico's current administration has taken notable steps to rein in debt and spending, to reform the retirement systems, and to promote economic growth. The Ba2 rating also incorporates our belief that the commonwealth would successfully raise enough cash in this financing to maintain an adequate liquidity profile through the end of fiscal 2015. The Ba2 rating and negative outlook are also based on chronic deficit financing, pension underfunding, and budgetary imbalance, along with seven years of economic recession and uncertain prospects for future economic growth. These factors, over a long period, have driven up Puerto Rico's debt and fixed costs, narrowed its liquidity, and hampered its bond-market access. Puerto Rico faces years of difficult decisions, as its debt and pension costs climb. Credit Strengths Political and economic links to the US, with benefit of the nation's strong financial, legal, and regulatory systems Large economy, with gross product exceeding that of 15 US states and population exceeding that of 22 US states Broad legal powers to raise revenues, adjust spending programs, and borrow to maintain solvency Major actions to stabilize finances, including significant reform to main pension system, and tax increases to reduce budget deficit Credit Challenges Ongoing economic weakness due to long-term decline in dominant manufacturing sector, decreased competitiveness as a result of expired federal tax benefits, high energy costs, declining population and high unemployment Weak internal liquidity with reliance on GDB and external financing Very large unfunded pension liabilities relative to revenues, even after major reforms to two main plans that helped reduce cash-flow pressure Very high government debt, equal to more than 50% of gross domestic product Multi-year trend of large general fund operating deficits relative to revenues, financed by deficit borrowing Outlook The rating outlook is negative, based on our expectation of continued economic stagnation or decline. The outlook also incorporates continuing demands on liquidity, increased refinancing risk and constrained market access. What Could Make The Rating Go Up Moody's do not expect the rating to go up in the near term What Could Make The Rating Go Down Indication that the commonwealth is actively considering debt restructuring or other strategies adverse to bondholders Evidence of significant further weakening of GDB liquidity Continued economic weakness resulting in declining revenues and accelerated out-migration of residents Return to growing budget deficits The principal methodology used in this rating was US States Rating Methodology published in April 2013. *********** Monday's edition of the TCR-LA delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-LA editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-LA constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-LA editor holds some position in the issuers' public debt and equity securities about which we report. Tuesday's edition of the TCR-LA features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. Submissions about insolvency-related conferences are encouraged. Send announcements to conferences@bankrupt.com *********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Latin America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Valerie U. Pascual, Julie Anne L. Toledo, and Peter A. Chapman, Editors. Copyright 2014. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Latin America subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. * * * End of Transmission * * *