/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/170417.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 Monday, April 17, 2017, Vol. 18, No. 75 Headlines B R A Z I L CAP SA: S&P Raises Rating to BB+ on Stronger Cash Flow Generation ODEBRECHT OFFSHORE: S&P Raises Rating on Notes to 'CC' SANTA CATARINA: S&P Affirms 'BB' ICR; Outlook Remains Negative C A Y M A N I S L A N D S DRYDEN CAPITAL: Creditors' Proofs of Debt Due April 17 GANYMEDE PARENT: Shareholders' Final Meeting Set for April 20 IC HOLDING: Commences Liquidation Proceedings NEZU ASIA JAPAN: Placed Under Voluntary Wind-Up NEZU ASIA PAN-ASIA: Placed Under Voluntary Wind-Up PRIVATE CLIENT: Creditors' Proofs of Debt Due April 27 RUFFALO CORPORATION: Commences Liquidation Proceedings SMITH ASSURANT: Commences Liquidation Proceedings STARDIAN CORPORATION: Commences Dissolution Proceedings STONEMOOR CAPITAL: Placed Under Voluntary Wind-Up VISIONCHINA MEDIA: Creditors' First Meeting Set for April 19 D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Gasoline & Diesel Prices Climb for 2nd Week DOMINICAN REPUBLIC: March Prices Fall -0.20%, Paced by Foods E L S A L V A D O R BANCO AGRICOLA: S&P Affirms 'B-' Long-Term Rating; Outlook Neg. EL SALVADOR: S&P Lowers Sovereign Credit Rating to 'CCC-' ISTMO COMPANIA: S&P Revises Counterparty Credit Rating to 'D' T R I N I D A D & T O B A G O TRINIDAD & TOBAGO: SWMCOL Workers Protest Again PETROTRIN: Energy Ministry Not Running Company X X X X X X X X X * BOND PRICING: For the Week From April 10 to April 14, 2017 - - - - - =========== B R A Z I L =========== CAP SA: S&P Raises Rating to BB+ on Stronger Cash Flow Generation ----------------------------------------------------------------- S&P Global Ratings raised its global-scale rating on CAP S.A. to 'BB+' from 'BB'. At the same time, S&P raised its issue-level rating on its senior unsecured notes to 'BB+' from 'BB'. The ratings were removed from CreditWatch, where they were placed with positive implications on Jan. 18, 2017. The outlook is stable. The ratings on CAP reflect the company's strategy and ability to change product mix to improve efficiency of its asset-base usage, while higher average iron ore prices and fairly low capital expenditure (capex) needs will continue to drive strong cash flow generation. This and the company's fairly low debt support S&P's view of fast improving financial metrics. Nonetheless, the company remains subject to financial metric volatility due to its exposure to iron ore prices, small scale of operations, and Chile's steel industry, which faces significant competition from imports. CAP's flexibility to adjust its product mix between iron ore pellets, pellet feed, and fines allowed it to overcome declining iron ore prices in early 2016 and maximize profitability. This strategy is likely to continue driving cash generation in coming quarters, as we expect iron ore to average $67 per ton in 2017, above last year's $58, but to remain volatile in the short to medium term. S&P also expects the company's steel processing and production businesses to focus on higher-margin products, as the Chilean steel market continues to face slow demand growth and intense competition from international players. CAP will also continue to benefit from its niche market position with higher grade iron ore products (63%-68% iron content) that drives more resilient demand and higher prices from iron ore content premiums. In S&P's view, the company is better positioned to deal with further expected price volatility driven by global supply and demand imbalances, supporting our expectation of fairly stable EBITDA margins in the 22%-30% range over the next two years. Further price pressures are likely in the short term, which combined with CAP's somewhat small scale of operations can add volatility to its cash generation. However, S&P expects CAP to continue to adjust its investment plan according to market conditions and maximize free cash generation. In S&P's base-case scenario, it assumes the company would continue to use its free cash generation to pay down maturing debt, leading to further improvement in financial metrics such as debt to EBITDA of about 1x and funds from operations (FFO) to debt of 70% in 2017. S&P's base-case scenario also includes these assumptions: -- Chile GDP growth of 1.9% in 2017 and 2.2% in 2018, affecting domestic steel demand; -- Average exchange rate of 670 Chilean pesos (CLP) per $1 in 2017 and CLP680 in 2018; -- Iron ore averaging $67 per ton in 2017 and $50 in 2018 and 2019; -- Coal increasing to $75 per ton in 2017, but declining to $65 in 2018; -- Cash cost of about $31 per ton in 2017 and $32 in 2018; -- Freight cost of $12 per ton in 2017 and 2018; -- Total iron ore production of 16.6 million tons in 2017 and 17.2 million tons in 2018; -- Pellet premiums of about $30 per ton over the next two years; -- Capex of $125 million in 2017 and maintenance capex of $60 million in 2018; and -- Minimum dividend payout of 30%. As a result of these assumptions, S&P reaches these financial metrics: -- Revenues of $1.76 billion in 2017 and $1.62 billion in 2018; -- EBITDA of $525 million in 2017 and $360 million in 2018; -- FFO of $375 million in 2017 and $275 million in 2018; -- FOCF of $230 million in 2017 and $150 million in 2018; -- Debt to EBITDA of about 1x over the next two years; -- FFO to debt above 65% in 2017 and 2018; -- FOCF to debt above 35% in 2017 and 2018. S&P revised CAP's liquidity assessment to strong from adequate. The company's improved cash generation, from persistently high iron ore prices, allowed for some debt repayment and boosted its cash position in 2016. S&P expects average iron ore prices to allow CAP's cash generation to cover for its debt maturities and capex needs over the next 24 months. Thus, S&P expects sources of liquidity to exceed uses by more than 1.5x over the next 12 months, and to remain above 1x in the following 12 months. Also, S&P expects sources of liquidity to continue to exceed uses even if EBITDA declines by 30%. S&P also do not expect covenant pressures given the current headroom under the company's 4x net financial debt to EBITDA requirement at the end of 2017. Principal liquidity sources: -- Cash and short-term investments of $785 million as of Dec. 31, 2016; and -- FFO generation of $375 million for 2017 and $275 million in 2018. Principal liquidity uses: -- Short-term debt of $327 million as of Dec. 31, 2016; -- Peak working capital needs of $20 million; -- Capex of $125 million in 2017 and maintenance capex of about $60 million; and -- Dividend payouts of 30% of the net income. The stable outlook reflects S&P's expectation that CAP will continue to be flexible with its product mix, execute capex to maximize cash generation, and mostly offset iron ore price volatility over the next 12 months. In addition, S&P expects the steel business to remain pressured given still-low global prices. Nonetheless, CAP will also continue to benefit from stable and predictable inflows from its water and energy transmission assets. Thus, S&P expects the company to continue presenting strong credit metrics over the next several quarters, such as debt to EBITDA below 1.5x, FFO to debt above 60%, and positive FOCF generation, despite expected weaker iron ore prices. A downgrade is likely if iron ore prices decline faster than S&P expects and CAP's offsetting measures don't prevent significant deterioration in cash flow, leading to significantly weaker credit metrics, such as debt to EBITDA near 3x and FFO to debt of about 30%. Although unlikely in the short term, S&P could raise the ratings if CAP presents improved scale and diversification of operations that support sustainably stronger profitability and less volatile cash flow metrics. ODEBRECHT OFFSHORE: S&P Raises Rating on Notes to 'CC' ------------------------------------------------------ S&P Global Ratings raised its rating on Odebrecht Offshore Drilling Finance Ltd's (OODFL's or the project's) notes to 'CC' from 'D'. At the same time, S&P placed the rating on CreditWatch negative. The upgrade follows OODFL's announcement that it has settled the overdue interest payment on its senior secured notes. The payment occurred on April 7, 2017, seven days after the 30-day grace period allowed by the indenture. It's S&P's understanding that the project is now up to date with the payments on its outstanding debt instruments. S&P continues to view OODFL's capital structure as unsustainable, and believe that the notes are at this point vulnerable to nonpayment on a timely basis. Still, S&P expects the project to comply with the next two debt service obligations (scheduled for June and September 2017) because it has the available resources in the form of $130 million in letters of credit and cash position. However, else being equal, under our base-case scenario, the risk of non-payment in December 2017 is very high. The CreditWatch listing continues to reflect the risk of renegotiation of OODFL's notes under unfavorable conditions, which S&P would likely consider as a distressed exchange. The listing also reflects the risk of a postponement of the upcoming interest payments on the notes beyond the 30 business days following the scheduled due date. It reflects also the risk of a failure to obtain a waiver after triggering a payment acceleration clause in October 2015 due to the early termination of ODN Tay drillship contracts with Petroleo Brasileiro -- Petrobras S.A. In order to remove the rating from CreditWatch and assign the stable outlook, OODFL's bondholders would have to waive the execution of the early acceleration clause, which S&P currently doesn't believe is likely to happen. SANTA CATARINA: S&P Affirms 'BB' ICR; Outlook Remains Negative -------------------------------------------------------------- S&P Global Ratings affirmed its 'BB' foreign and local currency issuer credit ratings on the state of Santa Catarina. S&P also affirmed its 'brAA-' national scale rating on the state. The outlook on both scale ratings remains negative. OUTLOOK The negative outlook reflects a one-in-three likelihood that Santa Catarina's credit quality could deteriorate as a result of lower ratings on Brazil and/or weakening of the institutional framework for local governments. S&P's base-case scenario assumes that Santa Catarina will continue to post a strong budgetary performance as the economy gradually recovers in the next few years, the financial management maintains prudent fiscal and debt policies, and contingent liabilities remain moderate. Downside scenario S&P could lower its ratings on Santa Catarina in the next 12-18 months if deficits after capex rise more than expected, which could erode the state's liquidity position beyond S&P's base-case assumptions. Also, S&P could lower the rating if the financial management reduces its commitment to service debt in a timely manner. Upside scenario S&P could revise the outlook to stable in the next 12-18 months to mirror a similar action on the sovereign. RATIONALE S&P has updated its base-case scenario for Santa Catarina and extended S&P's forecast period through 2019. S&P has also included additional information on the state's pension liabilities in the scenario. S&P assumes that Santa Catarina's satisfactory financial management and the gradual economic recovery will allow the state to maintain a stable budgetary performance and reduce its debt burden. Financial management has remained satisfactory amid weak economy and state's GDP per capita remains higher than most of Santa Catarina's peers. The ratings on Santa Catarina are a combination of the individual credit profile and the evolving but unbalanced institutional framework for state and municipalities in Brazil, which currently has a negative trend. The state has the sixth-highest GDP in the country. S&P estimates that its GDP per capita was $10,604 in 2016, higher than Brazil's $8,712, and comparable to that of Sao Paulo. The state benefits from a lower unemployment rate than those of its national peers, and sound physical infrastructure, and social conditions. S&P forecasts that Santa Catarina's economy will recover in line with the country's. Governor Raimundo Colombo, from the Partido Socialista Brasileiro (Social Democratic Party) has been in power since 2011. The state's financial planning has benefited from policy continuity. Despite the measures to control public-servant wage costs and annual pension payments, as well as to impring tax collection, S&P believes challenges in increasing budgetary flexibility will remain in the next few years. Amid recession, the current administration has worked to continue to attract investments to the state by offering tax incentives and through a large investment program (Pacto por Santa Catarina). Therefore, capacity to raise taxes in 2017-2018 will help the state maintain its strong budgetary performance in the next few years. Strong fiscal performance will likely prevail given more favorable economic conditions, but liquidity remains weak. S&P expects Santa Catarina to continue posting operating surpluses above 5% of operating revenues in 2017-2019, on average and deficits after capex below 5% of total revenues. S&P assumes that the state will implement additional measures to improve tax collection, including technical enhancements, specialization of tax auditors, productivity bonuses, and actions against tax evasion. In addition, the gradual recovery in the economy will improve Santa Catarina's tax revenue. S&P's base-case scenario assumes that the state's operating revenue to rise at a pace slightly above that of nominal GDP growth. The state is likely to control some of its operating expenses, although payroll pressures will remain high due to the expected increase of the police force. However, S&P estimates that operating spending overall would increase just below that of operating revenue in the next two years. Santa Catarina faces budgetary constraints. Public-sector employee wages (including pensions) and interest payments represent around 64% of total expenditures. Despite the state's commitment to contain wage increases and pension liabilities, they will continue to squeeze the budget. S&P believes that the state will slightly increase its capital spending to 8% of total spending in 2017-2019, above the previous-year level, thanks to a slightly easier access to new borrowings. Santa Catarina's investment in public works will continue to focus on connectivity improvement. In addition, S&P considers that state has a limited capacity to increase its own source revenues as the government remains committed to not raising tax rates in order to attract private investment. The state's own-source revenue is likely to average 78% of total revenue in 2017-2019, below those of the states of Sao Paulo (around 90%) and Minas Gerais (81%). Santa Catarina's liquidity remains weak, in S&P's view. S&P estimates that the state's internal liquidity would be sufficient to cover 78% of its estimated debt service in 2017. The state's debt to suppliers has decreased in 2016 to R$157 million, less than 1% of operating revenues. Access to external liquidity is limited, given that under Brazil's intergovernmental framework, the states must receive authorization from the federal government under certain specific rules and in compliance with fiscal targets to issue debt. In addition, the states can't maintain open contingent credit lines from banks. S&P expects Santa Catarina's tax-supported debt to represent 100% of its operating revenue in 2019, down from 105% in 2016, given that the state will only gradually increase its borrowings. Slightly over 50% of the state's debt is with the federal government, while the remainder is with public and commercial banks as well as multilateral lending agencies. Santa Catarina's debt level is lower than those of other Brazilian states such as Minas Gerais and Sao Paulo. S&P's base-case scenario for the next three years assumes that Santa Catarina's debt service costs will decline thanks to the debt renegotiation with the federal government. Additionally, S&P's debt assessment includes the state's stock of unfunded pension liabilities that are significantly higher than the annual operating revenue. Santa Catarina has moderate contingent liabilities, the largest of which stems from several state-owned companies including Casan, a water utility. S&P's assessment incorporates risks associated with cross-default clauses in the Brazilian Development Bank's (BNDES') loans to the state entities. Casan's debt with BNDES accounts for less than 1% of Santa Catarina's operating revenue as of December 2016. In addition the state guarantees around R$657 million of Casan's debt. RATINGS LIST Ratings Affirmed Santa Catarina (State of) Issuer Credit Rating Global Scale BB/Negative/-- Brazil National Scale brAA-/Negative/-- ========================== C A Y M A N I S L A N D S ========================== DRYDEN CAPITAL: Creditors' Proofs of Debt Due April 17 ------------------------------------------------------ The creditors of Dryden Capital, Ltd. are required to file their proofs of debt by April 17, 2017, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 17, 2017. The company's liquidator is: Richard Fear c/o Kevin Butler P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands Telephone: (345) 814 7374 Facsimile: (345) 945 3902 GANYMEDE PARENT: Shareholders' Final Meeting Set for April 20 ------------------------------------------------------------- The shareholders of Ganymede Parent Limited will hold their final meeting on April 20, 2017, 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: Walkers Liquidations Limited Cayman Corporate Centre 27 Hospital Road, George Town Grand Cayman KY1-9008 Cayman Islands Telephone: +1 (345) 949 0100 IC HOLDING: Commences Liquidation Proceedings --------------------------------------------- The sole shareholder of IC Holding Cayman Ltd., on March 15, 2017, passed a resolution to liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Graham Robinson Chris Johnson Associates Ltd., Elizabethan Square 80 Shedden Road, George Town P.O. Box 2499 Grand Cayman KY1-1104 Cayman Islands Telephone: +1 (345) 946-0820 NEZU ASIA JAPAN: Placed Under Voluntary Wind-Up ----------------------------------------------- The sole shareholder of Nezu Asia Fund Japan Only Trading Ltd., on March 17, 2017, passed a resolution to wind up the company's operations. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Richard Kincaid c/o Richard Bennett Ogier Central Tower, 11th Floor 28 Queen's Road Central Central Hong Kong Telephone: +852 3656 6069 Facsimile: +852 3656 6001 NEZU ASIA PAN-ASIA: Placed Under Voluntary Wind-Up -------------------------------------------------- The sole shareholder of Nezu Asia Fund Pan-Asia Trading Ltd., on March 17, 2017, passed a resolution to wind up the company's operations. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Richard Kincaid c/o Richard Bennett Ogier Central Tower, 11th Floor 28 Queen's Road Central Central Hong Kong Telephone: +852 3656 6069 Facsimile: +852 3656 6001 PRIVATE CLIENT: Creditors' Proofs of Debt Due April 27 ------------------------------------------------------ The creditors of The Private Client Portfolio are required to file their proofs of debt by April 27, 2017, to be included in the company's dividend distribution. The company commenced liquidation proceedings on March 9, 2017. The company's liquidator is: Paul Pavli c/o Mourant Ozannes Attorneys-at-Law for the Company Reference: NDL Telephone: (+1) 345 949 4123 Facsimile: (+1) 345 949 4647; or Paul Pavli Reference: PP 94 Solaris Avenue, Camana Bay P.O. Box 1348 Grand Cayman KY1-1108 Cayman Islands Telephone: (+357) 25 817 488 Facsimile: (+357) 25 749 755 RUFFALO CORPORATION: Commences Liquidation Proceedings ------------------------------------------------------ The shareholder of Ruffalo Corporation, on March 15, 2017, passed a resolution to liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Ruffalo Corporation Vera Lotte Kopenhagen Goldfinger Rua Bela Cintra, 2230 Sao Paulo Brazil SMITH ASSURANT: Commences Liquidation Proceedings ------------------------------------------------- The sole shareholder of Smith Assurant Group, on March 11, 2017, passed a resolution to liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Graham Robinson c/o Tanya Armstrong P.O. Box 2499 Grand Cayman KYl-1104 Cayman Islands Telephone: (345) 946-0820 Facsimile: (345) 946-0864 STARDIAN CORPORATION: Commences Dissolution Proceedings ------------------------------------------------------- Stardian Corporation commenced dissolution proceedings on Feb. 14, 2017 in accordance with the British Virgin Islands Business Companies Act 2004. The company's liquidator is: Cristian Mac Lean Rosario Norte 555 Piso 15 Las Condes, Santiago Chile STONEMOOR CAPITAL: Placed Under Voluntary Wind-Up ------------------------------------------------- The shareholders of Stonemoor Capital PTC Ltd., on March 17, 2017, passed a resolution to wind up the company's operations. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Alexandria Bancorp Limited Dayra Triana-Munroe Barbara Conolly The Grand Pavilion Commercial Centre 802 West Bay Road P.O. Box 2428 Grand Cayman KY1-1105 Cayman Islands Telephone: (345) 945-1111 VISIONCHINA MEDIA: Creditors' First Meeting Set for April 19 ------------------------------------------------------------ The creditors of Visionchina Media Inc. will hold their first meeting on April 19, 2017, at 9:00 a.m., to elect a liquidation committee and deal with other matters or resolutions that the liquidators think fit. The company's liquidator is: Margot MacInnis c/o Stephanie Scott Borrelli Walsh (Cayman) Limited Harbour Place, Ground Floor 103 South Church Street, George Town P.O. Box 30847 Grand Cayman KY1-1204 Cayman Islands Telephone: +1 (345) 743 8807 =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Gasoline & Diesel Prices Climb for 2nd Week --------------------------------------------------------------- Dominican Today reports that in what many people will likely dub a "palo asechado" (sucker punch), the Dominican Republic's Industry and Commerce Ministry raised all fuel prices for the week from April 15 to 21. Premium gasoline will cost RD$221.30, and regular gasoline RD$205.20, both RD$2.50 more; regular diesel will cost RD$154.00; optimum diesel will cost RD$165.60, both RD$2.00 more per gallon, according to Dominican Today. Avtur will cost RD$117.90; kerosene will cost RD$143.00, or RD$3.00 more on both, while fuel oil will cost RD$96.05 per gallon, or RD$1.75 higher, the report notes. Propane gas will cost RD$100.50 per gallon, or RD$2.00 more and natural gas will cost RD$28.97, or RD$3.71 higher per cubic meter, the report relays. The Central Bank's posted average exchange rate of RD$47.38 per dollar was used to calculate all fuel prices, the report adds. As reported in the Troubled Company Reporter-Latin America on Nov. 22, 2016, Fitch Ratings has taken the following rating actions on the Dominican Republic: -- Long-Term Foreign Currency Issuer Default Rating (IDR) upgraded to 'BB-' from 'B+'; assigned Stable Outlook; -- Long-Term Local Currency IDR upgraded to 'BB-' from 'B+'; assigned Stable Outlook; -- Senior unsecured Foreign and Local Currency bonds upgraded to 'BB-' from 'B+'; -- Short-Term Foreign Currency IDR affirmed at 'B'; -- Short-Term Local Currency IDR affirmed at 'B'. DOMINICAN REPUBLIC: March Prices Fall -0.20%, Paced by Foods ------------------------------------------------------------ Dominican Today reports that Dominican Republic's Central Bank said March prices were -0.20% compared with February, with first quarter accumulated inflation at 0.84 percent. It said annualized inflation, from March 2016 to March 2017, stood at 3.14%, "remaining around the lower limit of the goal established in the Monetary Program for the current year of 4.0% (Ò 1.0%)", according to Dominican Today. The Central Bank added that the negative inflation in March stemmed mostly from the lower prices on foods and non-alcoholic beverages, the report notes. As reported in the Troubled Company Reporter-Latin America on Nov. 22, 2016, Fitch Ratings has taken the following rating actions on the Dominican Republic: -- Long-Term Foreign Currency Issuer Default Rating (IDR) upgraded to 'BB-' from 'B+'; assigned Stable Outlook; -- Long-Term Local Currency IDR upgraded to 'BB-' from 'B+'; assigned Stable Outlook; -- Senior unsecured Foreign and Local Currency bonds upgraded to 'BB-' from 'B+'; -- Short-Term Foreign Currency IDR affirmed at 'B'; -- Short-Term Local Currency IDR affirmed at 'B'. ===================== E L S A L V A D O R ===================== BANCO AGRICOLA: S&P Affirms 'B-' Long-Term Rating; Outlook Neg. --------------------------------------------------------------- S&P Global Ratings affirmed its 'B-' long-term rating on Banco Agricola S.A. At the same time, S&P raised its short-term rating on the bank to 'B' from 'C', after placing the bank "Under Credit Observation" on April 7, 2017, following changes in S&P's revised global methodology for linking long-term and short-term ratings. The outlook remains negative. As a result of a lower anchor for banks operating in El Salvador, S&P lowered Banco Agricola's stand-alone credit profile (SACP) to 'bb-' from 'bb'. S&P maintains its BICRA score on El Salvador (CCC-/Watch Neg/C) at group '8'. S&P also maintained its '9' economic risk score. In addition, S&P revised its industry risk score to '7' from '6', reflecting potential pressure on system-wide funding related to the sovereign's credit stress. In S&P's view, the latter reduces investor confidence and represents a weakness for Salvadorian banks. As a result, S&P lowered the anchor for banks operating in El Salvador to 'b+' from 'bb-'. At the same time, S&P revised the trend in economic risk to negative from stable, based on increasing risks related to economic imbalances stemming from the weakening external position. The trend in industry risk remains negative. If the economic and industry risks materialize, S&P could lower both risk scores to a weaker category. Such an action could result in a similar revision of our BICRA group score, which could lower the anchor to 'b'. In S&P's view, El Salvador's economic risk is undermined by low GDP growth prospects, likely to be around 1.3% for 2017-2020, limited fiscal flexibility, due to political polarization that continues to limit the government's debt management, and absence of monetary flexibility, stemming from the 2001 switch to dollars. In S&P's opinion, the country's economic growth remains vulnerable to changes in the U.S. commercial and immigration policies because 48.4% of El Salvador's exports are destined for the U.S. and remittances from the latter represented 16% of the Central American country's GDP in 2015. On the other hand, lower foreign direct investments (FDI) inflow, coupled with high fiscal deficits, could increase risks to the banking system in terms of economic imbalances. In this sense, S&P believes that Salvadorian banks' resilience to adverse economic developments will be under pressure. S&P is revising its trend in economic risk to negative from stable. In S&P's view, further weakening of the economic risk score would stem from higher economic imbalances, particularly through higher external risk. S&P projects that the current account deficit is likely to exceed 5% of GDP in the next three years, contributing to weaker external liquidity. S&P also expects that FDI may decline from its already modest levels due to continued political stalemate. Political tensions, along with the country's deteriorating external position, could bring additional risks for banks in the form of lower economic growth and consequently, higher nonperforming loans, and lower credit growth and profitability. Lending contraction and rising credit losses could lead S&P to revise its economic imbalances to a correction phase. Therefore, such factors could increase economic imbalances in the future, weighing on banks' operating performance. S&P observes higher industry risks in El Salvador's banking system given that political polarization is weakening the government's ability to gain access to liquidity. S&P believes the sovereign credit stress has worsened following Congress' failure on April 7, 2017, to reach majority votes to allocate resources to cover payment to the pension system. Therefore, Salvadorian banks' access to wholesale funding could erode, and a potential deterioration of the economy could impair their liquidity given that total deposits could shrink. Therefore, S&P views system- wide funding in El Salvador at extremely high risk. Risk appetite in the Salvadorian banking system is currently moderate, reflected in modest share of high-risk lending and manageable growth of total assets. In addition, competitive dynamics benefit from a relatively concentrated banking system that contributes to industry stability. The system has a large presence of foreign- owned banks, parents of which are mostly following international standards. This would allow these banks a relatively smooth transition towards Basel III once the country adopts it. The negative trend in industry risk reflects a potentially harmful impact that banks' persistently weakening profitability could have on the industry's competitive dynamics. If profitability keeps falling, banks' risk appetite might increase to generate higher margins and financial results. In addition, lower profitability could pressure operating conditions, undermining the industry's stability. Moreover, if El Salvador delays improvements in its regulatory framework, S&P would revise its institutional framework score to high risk, which would weaken the industry risk score. In the past, the sovereign ratings limit those on Banco Agricola. However, now that the long-term rating on the country is below 'B-,' S&P is maintaining the long-term rating on the bank at 'B-' because the likelihood of default is the centerpiece of creditworthiness. Banco Agricola has a solid and fragmented base of deposits and has enough liquidity to meet its financial obligations in the next 12 months. In this sense, despite the sovereign's current credit stress, S&P doesn't believe that Banco Agricola is vulnerable or dependent upon favorable business, financial, and economic conditions at this time to meet its financial commitments. As a result of a lower anchor for banks operating in El Salvador, S&P lowered Banco Agricola's SACP to 'bb-' from 'bb'. S&P's issuer credit ratings on Banco Agricola still reflect its strong business position -- based on its leading position in El Salvador's banking industry -- adequate risk position, due to its stable asset quality metrics, and average funding with adequate liquidity as a result of a stable and fragmented deposit base. S&P reassessed the bank's capital and earnings to moderate from adequate based on a projected risk-adjusted capital (RAC) ratio consistently below 7% for the next 12 months. However, this has no impact on the bank's SACP. Banco Agricola is a core subsidiary of Bancolombia, S. A. y Companias Subordinadas (BBB-/Negative/A-3). EL SALVADOR: S&P Lowers Sovereign Credit Rating to 'CCC-' --------------------------------------------------------- S&P Global Ratings lowered its long-term foreign- and local- currency sovereign credit ratings on El Salvador to 'CCC-' from 'B-'. The ratings are on CreditWatch with negative implications. At the same time, S&P lowered the short-term foreign- and local- currency sovereign credit ratings to 'C' from 'B'. S&P's 'AAA' transfer and convertibility (T&C) assessment is unchanged. RATIONALE El Salvador's Congress recently failed to approve a budgetary allocation that was needed to cover payment of financial commitments for pension-related debt. As a result, the government missed payments on financial obligations coming from the Certificates for Pension Investments (CIPs) due between April 7 and April 10, 2017, adding up to $28.8 million. Because the CIP's maturities have no stated grace period, S&P treats these obligations as having an imputed five-business-day grace period as per S&P's criteria. S&P is placing both long-term ratings on CreditWatch negative given that it could further lower them to 'SD' (selective default) if the political stalemate continues to block the approvals for budget allocation during the following week and, therefore, the government remains unable to fund these missed payments. Political polarization has heightened over the last year, resulting in an uncertain policy environment, including diminished willingness and capability to maintain timely debt payments. This deteriorating political environment continues to erode El Salvador's credit quality. The government's budget for 2017, which was passed earlier this year, did not contain any allocations for servicing the CIP debt, due in part to political brinksmanship between the governing Frente Farabundo Marti para la Liberacion Nacional (FMLN) and the opposition Alianza Republicana Nacionalista (ARENA). The political stalemate between the FMLN and ARENA diminishes the likelihood of a new agreement on fiscal policy, including reforms to the pension system, before Congressional elections scheduled for March of next year. Pension-related obligations have weighed largely on El Salvador's fiscal and debt assessments and therefore on El Salvador's rating history since Congress implemented pension reform in 1998. The annual shortfall of the pension system is about 2% of GDP, and pension-related debt represents about 25% of total general government debt. Pension-related financial obligations are issued through a Pension Trust established in 2006 and managed by the National Development Bank (BANDESAL). The Pension Trust makes debt payments to holders of CIPs through transfers from El Salvador's Ministry of Finance. El Salvador's 2017 fiscal budget contains allocations to pay external debt maturities and short-term debt called LETES (Letras del Tesoro) due this year. The government is currently on time with the debt service of these obligations. However, S&P foresees higher risks coming from the lack of additional debt authorizations in Congress for the following six months, which would tighten the government's liquidity position. S&P's issuer credit ratings focus on the obligor's capacity and willingness to meet its financial commitments as they come due. They do not apply to any specific financial obligation, as they do not take into account the nature of and provisions of the obligation, its standing in bankruptcy or liquidation, statutory preferences, or the legality and enforceability of the obligation. S&P projects that the current account deficit is likely to exceed 5% of GDP in the next three years, contributing to weaker external liquidity. S&P also expects that foreign direct investment (FDI) may decline from its already modest levels due to continued political stalemate. S&P estimates that the country's gross external financing needs will exceed 100% of current account receipts and usable reserves in the next couple of years as well. Net general government debt is likely to surpass 60% of GDP in 2017-2019 compared with less than 55% of GDP in 2013. S&P's ratings on El Salvador reflect the sovereign's limited fiscal flexibility, lack of monetary flexibility, and low per capita income (which S&P estimates at just above US$4,400 in 2016), with expected GDP real growth to remain around 1.3% for 2017-2020. S&P believes that the government has limited ability to raise additional revenues and that the country suffers from a shortfall in basic services and infrastructure. El Salvador lacks its own currency and has forgone having a lender of last resort for its banking system. S&P's T&C assessment remains at 'AAA' because of S&P's view that the country will maintain the U.S. dollar as its currency. CREDITWATCH Failure to make payment on the CIPs within five business days from their due date would lead to a downgrade to 'SD'. S&P expects to resolve the CreditWatch by the middle of next week, based on the outcome of political negotiations. The ratings could stabilize at 'CCC-' if successful negotiations result in the full payment of the CIPs within the imputed grace period. S&P would likely maintain the rating at the 'CCC-' level subsequent to such payments being made because of the high level of political polarization in the country. The rating could improve to the higher 'CCC' category if the government and opposition parties were to reach agreement on fiscal policy that boosts access to liquidity and reduces the sovereign's risk of default in the coming 12 months. In accordance with S&P's relevant policies and procedures, the Rating Committee was composed of analysts that are qualified to vote in the committee, with sufficient experience to convey the appropriate level of knowledge and understanding of the methodology applicable. At the onset of the committee, the chair confirmed that the information provided to the Rating Committee by the primary analyst had been distributed in a timely manner and was sufficient for Committee members to make an informed decision. After the primary analyst gave opening remarks and explained the recommendation, the Committee discussed key rating factors and critical issues in accordance with the relevant criteria. Qualitative and quantitative risk factors were considered and discussed, looking at track-record and forecasts. The committee agreed that "Institutional Assessment" and "External Assessment" had deteriorated. All other key rating factors were unchanged. The chair ensured every voting member was given the opportunity to articulate his/her opinion. The chair or designee reviewed the draft report to ensure consistency with the Committee decision. The views and the decision of the rating committee are summarized in the above rationale and outlook. The weighting of all rating factors is described in the methodology used in this rating action. RATINGS LIST Rating Lowered and Placed On CreditWatch Negative To From El Salvador (Republic of) Sovereign Credit Rating CCC-/Watch Neg/C B-/Negative/B Rating Lowered To From El Salvador (Republic of) Senior Unsecured CCC- B- =========== P A N A M A =========== ISTMO COMPANIA: S&P Revises Counterparty Credit Rating to 'D' ------------------------------------------------------------- S&P Global Ratings revised its counterparty credit and financial strength ratings on Istmo Compania de Reaseguros, Inc. (Istmo Re) to 'D' from 'R' (under regulatory supervision). S&P also withdrew the ratings. The rating action followed the Panamanian insurance regulator's, Superintendencia de Seguros y Reaseguros de Panama (SSRP's), decision to forcibly liquidate the company. The regulator took control of Istmo Re in December 2016. S&P views the decision as the end of the regulatory supervision process. The forced liquidation reflects the deterioration of Istmo Re's financial position and its inability to meet its short- and long- term financial and policyholder obligations including payment default on policyholder obligations and failure to comply with payment agreements with ceding companies. The forced liquidation process also reflects the company's payment default on bank obligations, which triggered the execution of guarantees backing loans. The forced liquidation will include the sale of company's assets to use the proceeds to repay its obligors under the legal framework applicable to insurance companies in Panama. S&P don't expect the company to resume its operations anytime in the future. Therefore, S&P is withdrawing its ratings. ================================ T R I N I D A D & T O B A G O ================================ TRINIDAD & TOBAGO: SWMCOL Workers Protest Again ----------------------------------------------- Trinidad and Tobago Newsday reports that workers at the Trinidad and Tobago Solid Waste Management Company (SWMCOL), for the second time on the week ended April 14, picketed in front locked gates at the Beetham landfill morning, calling on Finance Minister Colm Imbert and the Minister of Public Utilities to meet with union to discuss issues affecting workers. President of the Industrial General and Sanitation Workers Union Robert Benacia described the working condition for workers as "inhumane," according to Trinidad and Tobago Newsday. "They are putting workers at further risk of being poisoned because we have indiscriminate dumping of toxic materials in these landfills. Workers are amongst the most hazardous conditions in the country," the report quoted Mr. Benacia as saying. Mr. Benacia said the condition at the landfill is not only affecting workers but the entire country because the dust blowing off the landfills contaminates Port-of-Spain and anywhere west of the landfill, the report notes. The report quotes Mr. Benacia as saying: "We have hospital waste, industrial waste, radio waste, dead and decease animals coming in here, you name it, and that is mixing in with carbon materials and blows like dust. "They need to place landfill management as a priority. We need to hear about time lines and the plans and how they want to implement, how it is going to affect the SWMCOL and the workers, and funding provided." The report notes that Mr. Benacia said they are again calling on Public Utility Minister Fitzgerald Hinds and Finance Minister Colm Imbert to settle all back pay immediately, and address the issues raised by the union. The workers staged their first protest on April 10. PETROTRIN: Energy Ministry Not Running Company ---------------------------------------------- Trinidad and Tobago Newsday reports that Energy Minister Franklin Khan dismissed claims from Oropouche East MP Dr. Roodal Moonilal that a committee established to look at recommendations for the restructuring State oil company Petrotrin is running the company. Responding to Moonilal's claims in the House of Representatives, Minister Khan said all MPs knew the establishment of such a committee was "par for the course" and this practice has been used by several administrations in the past, according to Trinidad and Tobago Newsday. "The ministry does not run the oil company," Mr. Khan said. He also dismissed suggestions that the committee's chairman Selwyn Lashley has a conflict of interest because he is also the Permanent Secretary in the Energy Ministry, the report notes. The report relays that Mr. Khan also rejected suggestions from Moonilal about there being an attempt to bypass the Integrity in Public Life Act. About Petrotrin Petroleum Company of Trinidad and Tobago is the major state-owned oil company in Trinidad and Tobago. The company was established in 1993 by the merger of Trintopec and Trintoc, two state-owned oil companies. Petrotrin's main holdings are extensive, mature onshore fields located across southern Trinidad. Large areas have been leased out to small private producers who are able to make a profit on wells that are unprofitable for Petrotrin, giving it higher labor costs. The company operates a refinery at Pointe-Pierre, just north of San Fernando in south Trinidad. Most crude petroleum produced in Trinidad is exported without being refined. The refinery depends on imported crude (mostly from Venezuela), which is either used domestically or exported. * * * The Troubled Company Reporter-Latin America relayed on July 23, 2015, citing Trinidad Express, that state-owned Petroleum Company of Trinidad and Tobago (Petrotrin) multiplied its losses 11.2 times to reach US$168 million for the nine months ended June 30, 2015 compared to US$15 million loss for the same period in 2014, but its earnings before income tax, depreciation and amortization (EBITDA) rose 132 per cent between March and June. The TCRLA on Dec. 2, 2014 relayed, citing Trinidad and Tobago Newsday, that in the face of falling global oil prices, Petroleum Company of Trinidad and Tobago rolled out a plan to remain viable and to survive in the harsh global oil industry. Petrotrin said in a media release that it is forging ahead with objective cost management decisions imperative to secure its viability, according to Trinidad and Tobago Newsday. The report said Petrotrin's operations have also been severely impacted due to unfavorable margins. The TCRLA reported on Jan. 21, 2014 that Trinidad Express, citing Energy Minister Kevin Ramnarine, said Petrotrin will make a loss for its 2013 financial year. According to Mr. Ramnarine, Petrotrin was scheduled to make the loss even before the series of oil spills affecting Trinidad's southwestern peninsula since December, Trinidad Express relayed. ================= X X X X X X X X X ================= * BOND PRICING: For the Week From April 10 to April 14, 2017 ------------------------------------------------------------ Issuer Name Cpn Price Maturity Country Curr ----------- --- ----- -------- ------- --- BA-CA Finance Cayman Lt 0.518 62.07 KY EUR CSN Islands XII Corp 7 68 BR USD CSN Islands XII Corp 7 67.75 BR USD Decimo Primer Fideicomi 4.54 52.63 10/25/2041 PA USD Decimo Primer Fideicomi 6 63.5 10/25/2041 PA USD Dolomite Capital Ltd 13.26 67.2 12/20/2019 CN ZAR Empresa de Telecomunica 7 73.14 1/17/2023 CO COP Empresa de Telecomunica 7 73.14 1/17/2023 CO COP ESFG International Ltd 5.75 0.66 KY EUR General Shopping Financ 10 72.5 KY USD General Shopping Financ 10 71.7 KY USD Global A&T Electronics 10 74 2/1/2019 SG USD Global A&T Electronics 10 74.5 2/1/2019 SG USD Global A&T Electronics 10 65.5 2/1/2019 SG USD Global A&T Electronics 10 65 2/1/2019 SG USD Gol Finance 8.75 63 BR USD Gol Finance 8.75 63.88 BR USD Gol Linhas Aereas SA 10.75 34.63 2/12/2023 BR USD Gol Linhas Aereas SA 10.75 34.63 2/12/2023 BR USD Inversora Electrica de 6.5 55 9/26/2017 AR USD Inversora Electrica de 6.5 55 9/26/2017 AR USD MIE Holdings Corp 7.5 75.16 4/25/2019 HK USD MIE Holdings Corp 7.5 75.26 4/25/2019 HK USD NB Finance Ltd/Cayman I 3.88 58.01 2/7/2035 KY EUR Newland International P 9.5 19.88 7/3/2017 PA USD Newland International P 9.5 19.88 7/3/2017 PA USD Noble Holding Internati 5.25 72.98 3/15/2042 KY USD Ocean Rig UDW Inc 7.25 39 4/1/2019 CY USD Ocean Rig UDW Inc 7.25 38 4/1/2019 CY USD Odebrecht Drilling Norb 6.35 48.5 6/30/2021 KY USD Odebrecht Drilling Norb 6.35 47.25 6/30/2021 KY USD Odebrecht Finance Ltd 7.5 49 KY USD Odebrecht Finance Ltd 4.3 48.29 4/25/2025 KY USD Odebrecht Finance Ltd 7.12 48.2 6/26/2042 KY USD Odebrecht Finance Ltd 5.25 46.15 6/27/2029 KY USD Odebrecht Finance Ltd 7 57.02 4/21/2020 KY USD Odebrecht Finance Ltd 5.12 53.51 6/26/2022 KY USD Odebrecht Finance Ltd 8.25 70.88 4/25/2018 KY BRL Odebrecht Finance Ltd 6 51.47 4/5/2023 KY USD Odebrecht Finance Ltd 5.25 45.92 6/27/2029 KY USD Odebrecht Finance Ltd 7.1 47.82 6/26/2042 KY USD Odebrecht Finance Ltd 7.5 49.25 KY USD Odebrecht Finance Ltd 4.3 48.39 4/25/2025 KY USD Odebrecht Finance Ltd 6 51.77 4/5/2023 KY USD Odebrecht Finance Ltd 8.2 70.88 4/25/2018 KY BRL Odebrecht Finance Ltd 7 56.85 4/21/2020 KY USD Odebrecht Finance Ltd 5.1 52.99 6/26/2022 KY USD Odebrecht Offshore Dril 6.6 39.64 10/1/2022 KY USD Odebrecht Offshore Dril 6.7 36.44 10/1/2022 KY USD Odebrecht Offshore Dril 6.6 38.79 10/1/2022 KY USD Odebrecht Offshore Dril 6.7 38.75 10/1/2022 KY USD Petroleos de Venezuela 12.75 67.19 2/17/2022 VE USD Petroleos de Venezuela 9 58.28 11/17/2021 VE USD Petroleos de Venezuela 6 40.32 5/16/2024 VE USD Petroleos de Venezuela 9.75 50.15 5/17/2035 VE USD Petroleos de Venezuela 6 38.22 11/15/2026 VE USD Petroleos de Venezuela 5.37 37.39 4/12/2027 VE USD Petroleos de Venezuela 5.5 37.1 4/12/2037 VE USD Petroleos de Venezuela 6 41.25 10/28/2022 VE USD Petroleos de Venezuela 6 40.01 5/16/2024 VE USD Petroleos de Venezuela 9 58.11 11/17/2021 VE USD Petroleos de Venezuela 6 38.13 11/15/2026 VE USD Petroleos de Venezuela 12.75 67.2 2/17/2022 VE USD Petroleos de Venezuela 9.75 49.94 5/17/2035 VE USD Polarcus Ltd 5.6 60 3/30/2022 AE USD Siem Offshore Inc 5.8 49.75 1/30/2018 NO NOK Siem Offshore Inc 5.59 50.25 3/28/2019 NO NOK STB Finance Cayman Ltd 2.04 58.35 KY JPY Sylph Ltd 2.36 50.93 9/25/2036 KY USD Uruguay Notas del Tesor 5.25 68.02 12/29/2021 UY UYU US Capital Funding IV L 1.25 51.35 12/1/2039 KY USD US Capital Funding IV L 1.25 51.35 12/1/2039 KY USD USJ Acucar e Alcool SA 9.87 67.5 11/9/2019 BR USD USJ Acucar e Alcool SA 9.87 65.75 11/9/2019 BR USD Venezuela Government In 9.25 48.75 5/7/2028 VE USD Venezuela Government In 13.63 82.58 8/15/2018 VE USD Venezuela Government In 9 51.75 5/7/2023 VE USD Venezuela Government In 9.37 49 1/13/2034 VE USD Venezuela Government In 7 71.88 12/1/2018 VE USD Venezuela Government In 9.25 52 9/15/2027 VE USD Venezuela Government In 7.65 46.38 4/21/2025 VE USD Venezuela Government In 13.63 82.58 8/15/2018 VE USD Venezuela Government In 7.75 61.75 10/13/2019 VE USD Venezuela Government In 11.95 58.13 8/5/2031 VE USD Venezuela Government In 6 53.75 12/9/2020 VE USD Venezuela Government In 12.75 67 8/23/2022 VE USD Venezuela Government In 7 44 3/31/2038 VE USD Venezuela Government In 6.5 36.53 12/29/2036 VE USD Venezuela Government In 8.25 47.75 10/13/2024 VE USD Venezuela Government In 11.75 57.75 10/21/2026 VE USD Venezuela Government TI 5.25 69.59 3/21/2019 VE USD *********** 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, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2017. 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 202-362-8552. * * * End of Transmission * * *