/raid1/www/Hosts/bankrupt/TCRLA_Public/171009.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, October 9, 2017, Vol. 18, No. 200
Headlines
A R G E N T I N A
ARGENTINA: Pres. Has Private Meeting With EX US President Obama
B R A Z I L
BRAZIL: Temer Unveils Program to Boost Small Businesses
CONSTRUTORA E INCORPORADORA: Chapter 15 Case Summary
D O M I N I C A
DOMINICA: UNICEF Needs $6.2MM to Meet Needs of Children
D O M I N I C A N R E P U B L I C
DOMINICAN REP: Proposed 10% Tax on Large Users a Hurdle to Pact
ODEBRECHT SA: Insists on US$708M in Cost Overruns for Govt. Plant
J A M A I C A
BERGER PAINTS: Shares Trading Suspended in Jamaica
M E X I C O
CONSOLIDATED ENERGY: S&P Ups $1.3BB Sr. Unsec. Debt Rating to 'BB'
GUASAVE: Moody's Affirms B1 Issuer Rating; Outlook Negative
MONTERREY MUNICIPALITY: Moody's Affirms Ba2 Issuer Rating
P U E R T O R I C O
FIRSTBANK PUERTO RICO: Fitch B- LT IDR on Rating Watch Negative
POPULAR INC: Fitch Puts B Short-Term IDR on Rating Watch Negative
T R I N I D A D & T O B A G O
TRINIDAD & TOBAGO: Insurers Facing Higher Premiums
X X X X X X X X X
* BOND PRICING: For the Week From Oct. 2 to Oct. 6, 2017
- - - - -
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A R G E N T I N A
=================
ARGENTINA: Pres. Has Private Meeting With EX US President Obama
----------------------------------------------------------------
EFE News reports that Argentine President Mauricio Macri held a
private meeting with former US President Barack Obama at a golf
course in the Buenos Aires province town of Bella Vista near the
nation's capital, official sources said in a statement.
The Argentine government noted the informal and private nature of
the meeting, held outside all official protocol and more like a
pastime shared by "friends," according to the state news agency
Telam, according to EFE News.
* * *
As reported in the Troubled Company Reporter-Latin America on
May 10, 2017, Fitch Ratings affirmed Argentina's Long-Term Foreign
and Local Currency Issuer Default Ratings (IDRs) at 'B' with a
Stable Outlook. The issue ratings on Argentina's senior unsecured
Foreign and Local Currency bonds are also affirmed at 'B'. The
Country Ceiling is affirmed at 'B' and the Short-Term Foreign and
Local Currency IDRs at 'B'.
On Jan. 30, 2017, the Troubled Company Reporter-Latin America
reported that Moody's Investors Service has assigned a B3 rating
to the Government of Argentina's US$3.25 billion bond due 2022 and
the US$3.75 billion bond due 2027. The outlook on the Government
of Argentina's rating is stable.
As previously reported by the TCR-LA, Argentina defaulted on some
of its debt late July 30, 2014, after expiration of a 30-day grace
period on a US$539 million interest payment. Earlier that day,
talks with a court-appointed mediator ended without resolving a
standoff between the country and a group of hedge funds seeking
full payment on bonds that the country had defaulted on in 2001.
A U.S. judge had ruled that the interest payment couldn't be made
unless the hedge funds led by Elliott Management Corp., got the
US$1.5 billion they claimed. The country hasn't been able to
access international credit markets since its US$95 billion
default 13 years ago.
On March 30, 2016, after more than 12 hours of debate in the
Senate, Argentina's Congress passed a bill that will allow the
government to repay holders of debt that the South American
country defaulted on in 2001, including a group of litigating
hedge funds that won judgments in a New York court. The bill
passed by a vote of 54-16.
===========
B R A Z I L
===========
BRAZIL: Temer Unveils Program to Boost Small Businesses
-------------------------------------------------------
EFE News reports that President Michel Temer said that his
administration planned to provide BRL9 billion (nearly $2.9
billion) to stimulate Brazil's small-and mid-sized businesses and
a program to refinance debts.
Small-and mid-sized companies represent 98 percent of Brazil's
businesses, account for 27 percent of the gross domestic product
(GDP) and employ 60 percent of the labor force, providing "a
permanent" source of job creation, Mr. Temer said, according to
EFE News.
Efforts to reduce unemployment, which has been decreasing but is
still at 12.6 percent, are a priority for the government, Mr.
Temer said, the report notes.
"When someone gets a job, it is not just money coming in, but it
also has to do with self-esteem and a sense of dignity that
changes the mood within families," the president said, adding that
despite persistent headwinds, Brazil's economy "is in a process of
sustainable recovery," notes the report.
Brazil's economy emerged in the second half of 2017 from a deep
recession that trimmed almost seven percentage points from the GDP
between 2015 and 2016, the report relays.
In the first quarter of 2017, Brazil's economy grew by 1 percent,
and it expanded by 0.20 percent in the second quarter, leading
economists to forecast full-year growth of 0.70 percent, matching
Central Bank estimates, the report adds.
As reported in the Troubled Company Reporter-Latin America on
Aug. 17, 2017, S&P Global Ratings removed its 'BB' long-term
foreign and local currency sovereign credit ratings on the
Federative Republic of Brazil from CreditWatch, where it had
placed them with negative implications on May 22, 2017. S&P said,
"At the same time, we affirmed the 'BB' long-term ratings, and the
outlook is negative. We also affirmed our 'B' short-term foreign
and local currency ratings on Brazil. The transfer and
convertibility assessment is unchanged at 'BBB-'. In addition, we
removed the 'brAA-' national scale rating from CreditWatch with
negative implications and affirmed the rating with a negative
outlook. This incorporates the revision of the mapping table for
Brazil national scale ratings, published Aug. 14, 2017."
CONSTRUTORA E INCORPORADORA: Chapter 15 Case Summary
----------------------------------------------------
Chapter 15 Debtor: Construtora e Incorporadora
Atlantica Ltda.
939 Rua Conego Eugenio Leite, Pinheiro
Sao Paulo, Sao Paulo 05414
Brazil
Chapter 15 Case No.: 17-12787
Type of Business: Construction
Chapter 15 Petition Date: October 3, 2017
Court: United States Bankruptcy Court
Southern District of New York
(Manhattan)
Judge: Hon. Stuart M. Bernstein
Chapter 15 Petitioner: Eliza Fazan, legal representative of
Alta Administracao Judicial Ltda.
1353 Rua Vergueiro, Torre Sul, bjs.909
Sao Paulo, Sao Paulo 04101
Brazil
Foreign
Proceeding in
Which Appointment
of Foreign
Representative
Occurred: Case No. 1132473-02.2015.8.26-0100
Chapter 15 Petitioner's
Counsel: Eugene F. Getty, Esq.
KELLNER HERLIHY GETTY
& FRIEDMAN, LLP
470 Park Avenue South
7th Floor North
New York, NY 10016
Tel: (212) 889-2821
Fax: (212) 684-6224
E-mail: efg@khgflaw.com
Estimated Assets: Unknown
Estimated Debts: Unknown
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/nysb17-12787.pdf
===============
D O M I N I C A
===============
DOMINICA: UNICEF Needs $6.2MM to Meet Needs of Children
-------------------------------------------------------
UNICEF said it needs $6.2 million to meet the urgent needs of
children affected by Hurricane Maria in Dominica. The category 5
storm, which hit the Caribbean island on September 19, forced
65,000 people, including 20,000 children, away from their homes.
The funds are part of a broader $28 million appeal by humanitarian
agencies to provide immediate needs in one of the poorest islands
of the Caribbean.
"Children need access to safe drinking water and sanitation, a
safe return to school and protection," said Maria Cristina
Perceval, UNICEF Regional Director for Latin America and the
Caribbean. "Their needs should be addressed in an urgent manner."
UNICEF will support national efforts to provide safe drinking
water, sanitation and hygiene to 37,500 people.
UNICEF will also contribute to the establishment of temporary
learning spaces, complete with education materials, and will offer
psycho-social support, protection and care for the affected
children.
This latest appeal raises the funding needed to address immediate
needs in the Caribbean to $113.9 million, following a particularly
devastating hurricane season which has impacted more than 2
million people.
About UNICEF
UNICEF works in some of the world's toughest places, to reach the
world's most disadvantaged children. Across 190 countries and
territories, we work for every child, everywhere, to build a
better world for everyone.
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REP: Proposed 10% Tax on Large Users a Hurdle to Pact
---------------------------------------------------------------
Dominican Today reports that businesses won't sign the Electricity
Pact if a 10% tax is charged to unregulated (high volume) users,
because in their view this will lead to higher costs, said
Dominican Republic Industries Association (AIRD) vice president
Circe Almanzar.
"Imagine that if instead of achieving better conditions of
competitiveness we would be increasing the price to the
unregulated users, and therefore would mean more competition from
our international competitors," she said, according to Dominican
Today. "The 10% is illogical," the report quoted Ms. Almanzar as
saying.
In that regard, Electricity Superintendence Administrative Council
member Angel Cano affirmed that in the Pact's current framework
won't affect the light bill or productive sectors, the report
notes.
He said what's needed is a tariff system that allows the
electricity distributors to recover costs and clean up finances,
as well as reduce losses in the energy supply, the report relays.
"That 10% wouldn't affect the electricity tariff or what users pay
outside the formula," Mr. Cano said, the report notes. "To that
extent a series of parameters is being established that will allow
the distributing companies to reduce the losses in a certain time
and to have a financial health that allows them to be self-
sustaining."
The talks resumed with several points discussed which, according
to some participants, are closer to concluding the debate, the
report relays.
The proposed 10% tax on unregulated users is one of the sticky
topics in the talks leading to the Electricity Pact, says
Dominican Today.
At the previous meeting, Herrera and Santo Domingo Province
Industries Association (AEIH) president Antonio Taveras said it's
still possible that all sectors involved put the country's
interest above theirs to approve the pact, the report says.
As reported in Troubled Company Reporter-Latin America on July 24,
2017, Moody's Investors Service has upgraded the Dominican
Republic's long term issuer and debt ratings to Ba3 from B1 and
changed the outlook to stable from positive, based on the
following key drivers:
(1) The Dominican Republic's continued robust growth outlook
compared to rating peers, coupled with a reduction in
external risks as current account deficits have declined and
international reserves have increased.
(2) The reduction in fiscal deficits over the last four years and
Moody's expectation that fiscal deficits will remain shy of
3% of GDP, supported by fiscal restraint and reduced
transfers to the electricity sector.
ODEBRECHT SA: Insists on US$708M in Cost Overruns for Govt. Plant
-----------------------------------------------------------------
Dominican Today reports that the consortium Odebrecht-Estrella-
Tecnimont reiterated its demand that the Dominican State pay
US$708 million in cost overruns in the Punta Catalina power plant,
although the Government insists that it 'won't pay a "single
penny" over the US$1.9 billion contracted.
The parties met at the offices of the State-owned Electric Utility
(CDEEE) to discuss the standoff, where the parties argued over the
terms of the Construction Engineering and Procurement (EPC)
contract, according to Dominican Today.
Despite the contradictions both parties agreed on the need to
bring the 754-megawatt plant on line by yearend 2018 as planned,
the report notes.
Among topics covered figure the seawater expulsion system, the
preparation of the ground and the port's height, the report
relays.
CDEEE CEO, Ruben Jimenez Bichara, said despite the dispute, the
common interest is to conclude the facility, the report relays.
"The CDEEE will resort to all the procedures established in the
contract in cases of divergences, in order to make the work a
reality with what was originally budgeted," the report quoted Mr.
Bichara as saying.
As reporter in the Troubled Company Reporter-Latin America on
Dec. 2, 2016, The Wall Street Journal related that Marcelo
Odebrecht, the jailed former head of Brazilian construction giant
Odebrecht SA, agreed to sign a plea-bargain agreement in
connection with Brazil's largest corruption probe ever, according
to a person close to the negotiations. The move could roil the
nation's political class yet again. The testimony of the former
industrialist, which is part of the deal, has the potential to
implicate numerous politicians who allegedly took kickbacks from
contractors as part of a years-long graft ring centered on
Brazil's state-run oil company, Petroleo Brasileiro SA, known as
Petrobras, according to The Wall Street Journal.
=============
J A M A I C A
=============
BERGER PAINTS: Shares Trading Suspended in Jamaica
----------------------------------------------------
RJR News reports that trading in Berger Paints Jamaica shares has
been suspended by the Jamaica Stock Exchange.
This took effect on Thursday, Oct. 5 and will continue until next
Friday, Oct. 13, according to RJR News.
The Stock Exchange says this is to facilitate the processing of
the transaction in respect to Berger shareholders who have agreed
to sell their shares to Ansa Coatings International as part of the
company's takeover bid for Berger, the report notes.
Trading in Berger shares will resume on October 16, the report
adds.
===========
M E X I C O
===========
CONSOLIDATED ENERGY: S&P Ups $1.3BB Sr. Unsec. Debt Rating to 'BB'
------------------------------------------------------------------
S&P Global Ratings said that it has reviewed its senior unsecured
issue-level ratings for Consolidated Energy Limited (CEL) that
were labeled as under criteria observation (UCO) after publishing
its revised issue ratings criteria, "Reflecting Subordination Risk
In Corporate Issue Ratings" on Sept. 21, 2017. With its criteria
review complete, S&P is removing the UCO designation from these
ratings and are raising its issue rating on CEL's approximately
$1.3 billion senior unsecured debt to 'BB' from 'BB-', which
includes the issues carried out through its subsidiary
Consolidated Energy Finance S.A. (CEF).
S&P said, "These rating actions stem solely from the application
of our revised issue rating criteria and do not reflect any change
in our assessment of the corporate credit ratings for issuers of
the affected debt issues.
"Our rating action takes into consideration CEL's capital
structure, which consists of about $830 million of secured debt,
and about $1.54 billion consolidated unsecured debt, and about
$270 million of unsecured debt issued by its operating
subsidiaries. Under the new criteria, we have revised the approach
to indicate subordination risk. For CEL, since all the subsidiary
debt (priority debt) is less than 50% of CEL's consolidated debt,
our ratings on CEL's unsecured debt (issued through CEF)are 'BB',
or the same as the issuer credit rating, because no significant
element of subordination risk is present in the capital
structure."
The issue ratings raised are as follows:
-- The original issuance of $1.05 billion of unsecured due 2019
issued by CEF, whose outstanding balance after refinancing is
about $488 million.
-- The $300 million unsecured debt due 2022 issued by CEF. The
$500 million unsecured debt due 2025 issued by CEF.
RATINGS LIST
Consolidated Energy Limited
Corporate Credit Rating BB
Upgraded
TO FROM
Consolidated Energy Finance S.A.
Senior Unsecured BB BB-
GUASAVE: Moody's Affirms B1 Issuer Rating; Outlook Negative
-----------------------------------------------------------
Moody's de Mexico affirmed the issuer ratings of the Municipality
of Guasave at B1 (Global Scale, local currency) and Baa3.mx
(Mexico National Scale), the outlook remains negative. At the same
time Moody's assigned a debt ratings of B1 (Global Scale, local
currency) and Baa2.mx (Mexico National Scale) to Guasave's MXN
111.9 million senior secured bank facility from Banco Bansi
(original face value) with a maturity of 10 years.
RATINGS RATIONALE
Guasave has a tight liquidity position, relatively high debt
levels and operating and financial margins in line with the B1
median. In 2016, net direct and indirect debt levels declined to
43.7% compared with the 52.6% of 2015. However, the liquidity
position measured by the ratio of cash and cash equivalents to
current liabilities continues to be weak.
Guasave has implemented measures to reduce operating expenditures
and moderate infrastructure investment. As a result, the
municipality's 2016 gross operating balance (GOB) and cash
financing balance improved to 3.7% of operating revenues and 4.1%
of total revenues, respectively, compared with negative margins of
-10.9% and -12.4% in 2015. Operating revenues registered an annual
growth rate of 8.4% in 2016, also supporting the fiscal
consolidation.
As of June 2017 operating revenues and expenditures have followed
a similar trend to 2016, showing an annual change of 11% and -7%,
respectively. Therefore, Moody's estimates that GOB and cash
financing will continue to strengthen throughout the remainder of
the year.
The B1/Baa2.mx debt ratings reflect the underlying
creditworthiness of the municipality of Guasave. The municipality
used the proceeds of the financing to upgrade its public light
system. The obligation is directly paid by the municipality. A
guarantee trust was set up to ensure debt service only if the
municipality fails to make full and timely payments to Bansi.
Guasave pledged 8% of its federal participations revenues to the
trust through an irrevocable instruction to the State of Sinaloa.
While the obligation relies firstly on the capacity and
willingness to pay of the municipality, Moody's note the
enhancements in the structure by assigning a different rating in
the local scale.
WHAT COULD CHANGE THE RATINGS UP/DOWN
Given the negative outlook on the issuer ratings an upgrade is
unlikely in the near term. However, issuer ratings could stabilize
if Guasave maintains the improvement of its operating balances,
strengthens its liquidity position and debt continues to decrease
to levels around 20% of operating revenues. Conversely, if
Guasave's liquidity deteriorates with frequent use of short-term
debt and operating and consolidated financial results deteriorate,
the issuer ratings could face downward pressure. A downgrade of
the sovereign could also lead to a downgrade of Guasaves's
ratings.
Given the links between the debt obligation and the credit quality
of the obligor, an upgrade of issuer ratings would likely result
in an upgrade of its debt obligation ratings. Conversely, a
downgrade of Guasave's issuer rating could also derive in downward
pressure on the debt ratings.
The principal methodology used in these ratings was Regional and
Local Governments published in June 2017.
The period of time covered in the financial information
MONTERREY MUNICIPALITY: Moody's Affirms Ba2 Issuer Rating
---------------------------------------------------------
Moody's de Mexico affirmed the Municipality of Monterrey's issuer
rating at Ba2 (Global Scale, local currency) and A2.mx (Mexico
National Scale). The outlook was changed to stable from negative.
RATINGS RATIONALE
RATIONALE FOR THE AFFIRMATION OF THE BA2 RATING
The affirmation of Monterrey's Ba2/A2.mx issuer ratings reflects
its wealthy economy, high own-source revenues and decreasing but
still relatively high debt levels. In 2016, Monterrey's own-source
revenues stood at 44.3% of operating revenues and net direct and
indirect debt at 42.6% of operating revenues, both higher than the
Ba2 median. The municipality raised some property tax rates and is
taking measures to increase tax collection in 2017, which will
lift tax collections this year, supporting continued high own-
source revenues. Monterrey has also concluded a debt refinancing
and Moody's estimates debt levels will decrease to 40.9% of
operating revenues in 2017 and debt service to total revenue will
fall to 3.1% in 2017 from 7.8% in 2016.
RATIONALE FOR THE STABLE OUTLOOK
The change of outlook to stable from negative reflects an
improvement in Monterrey's gross operating balance to 15.3% of
operating revenues in 2016 from -8.5% in 2014. As of June 2017,
operating expenditures grew by 27.1% compared to June 2016 and
operating revenues increased by 18% in the same period. Moody's
estimates that gross operating balances will decrease to around 9%
of operating revenues on average in 2017 and 2018, a still high
level.
Liquidity has also improved, with cash and equivalents to current
liabilities rising to 1.0x at the end of 2016 from 0.5x in 2015.
Monterrey's capital expenditures will increase substantially in
2017 and 2018 and Moody's estimates that the municipality will
fund these expenditures with available funds and debt contracted
in 2017. As a result, Moody's expects consolidated financial
results to be roughly balanced and that the municipality will
maintain solid liquidity metrics.
WHAT COULD CHANGE THE RATINGS UP/DOWN
If Monterrey's operating and financial results are maintained
around current levels and if liquidity remains solid the
municipality's ratings could face upward pressure. On the other
hand, the municipality's ratings could face negative pressure if
there is a sudden deterioration in debt and financial metrics
and/or in liquidity.
The principal methodology used in these ratings was Regional and
Local Governments published in June 2017.
The period of time covered in the financial information used to
determine Municipality of Monterrey's rating is between 01/01/2012
and 31/12/2016 (source: Municipality of Monterrey).
======================
P U E R T O R I C O
======================
FIRSTBANK PUERTO RICO: Fitch B- LT IDR on Rating Watch Negative
---------------------------------------------------------------
Fitch Ratings has placed First Bancorp's (FBP) 'B-' Long-Term
Issuer Default Rating (IDR), 'B' Short-Term IDR and 'b-' Viability
Rating (VR) on Rating Watch Negative due to the uncertainty of the
impact caused by Hurricane Maria on Puerto Rico.
KEY RATING DRIVERS
IDRS AND VRS
The ratings have been placed on Negative Watch because Fitch
believes that the challenges posed by Hurricane Maria, including
massive destruction to vital infrastructure, homes, businesses,
and other property, could make it difficult for FBP to maintain
positive momentum in asset quality, earnings, and deposit funding
metrics that the company has reported over the past several
quarters.
Historically, FBP's ratings have incorporated the significant
challenges posed by the weak operating environment in Puerto Rico.
However, going forward, Fitch expects the destruction caused by
Hurricane Maria to further weaken the operating environment. Fitch
also expects the hurricane's impact will complicate the
Commonwealth of Puerto Rico's (PR) efforts to reverse outward
migration, generate sustainable economic growth, and address its
fiscal and debt imbalances.
SUPPORT RATING AND SUPPORT RATING FLOOR
The Support Rating of '5' and Support Ratings Floor of 'NF'
reflect Fitch's view that FBP is not considered systemically
important, and therefore the probability of support is unlikely.
The IDRs and VRs do not incorporate any support.
LONG- AND SHORT-TERM DEPOSIT RATINGS
FBP's uninsured deposit ratings at its subsidiary banks are rated
one notch higher than FBP's IDR and senior unsecured debt rating
because U.S. uninsured deposits benefit from depositor preference.
U.S. depositor preference gives deposit liabilities superior
recovery prospects in the event of default.
HOLDING COMPANY
FBP has a bank holding company (BHC) structure with the bank as
the main subsidiary. IDRs and VRs are equalized with those of the
operating companies and banks, reflecting its role as the bank
holding company, which is mandated in the U.S. to act as a source
of strength for its bank subsidiaries. Double leverage is below
120% for the FBP parent company.
RATING SENSITIVITIES
IDRS AND VRS
Fitch expects to resolve the Rating Watch Negative within the next
six months. Fitch also expects that the bank's quarterly financial
results as well as disclosures from the U.S. Federal Government
and the Commonwealth of Puerto Rico will bring greater visibility
into the potential short- and long-term effects that this
unprecedented event may have on financial performance and
ultimately the company's ratings.
SUPPORT RATING AND SUPPORT RATING FLOOR
The Support Rating and Support Rating Floor are sensitive to
Fitch's assumption around capacity to procure extraordinary
support in case of need.
LONG- AND SHORT-TERM DEPOSIT RATINGS
The ratings of long- and short-term deposits issued by FBP
subsidiaries are primarily sensitive to any change in the
company's IDRs. This means that should a long-term IDR be
downgraded, deposit ratings could be similarly affected.
HOLDING COMPANY
If FBP became undercapitalized or increased double leverage
significantly, there is the potential that Fitch could notch the
holding company IDR and VR from the ratings of the operating
companies.
Fitch has placed the following ratings on Rating Watch Negative:
First BanCorp
-- Long-Term IDR 'B-';
-- Short-Term IDR 'B';
-- Viability Rating 'b-'.
FirstBank Puerto Rico
-- Long-Term IDR 'B-';
-- Long-term deposit 'B/RR3';
-- Short-Term IDR 'B';
-- Short-term Deposits 'B';
-- Viability 'b-'.
Fitch has affirmed the following ratings:
First BanCorp
-- Support '5';
-- Support floor 'NF'.
FirstBank Puerto Rico
-- Support '5';
-- Support floor 'NF'.
POPULAR INC: Fitch Puts B Short-Term IDR on Rating Watch Negative
-----------------------------------------------------------------
Fitch Ratings has placed Popular Inc.'s (BPOP) 'BB-' Long-Term
Issuer Default Rating (IDR), 'B' Short-Term IDR, and 'bb-'
Viability Rating (VR) on Rating Watch Negative due to the
uncertainty of the impact caused by Hurricane Maria on
Puerto Rico.
KEY RATING DRIVERS
IDRs, VRs, AND SENIOR DEBT
The ratings have been placed on Negative Watch because Fitch
believes that the challenges posed by Hurricane Maria, including
massive destruction to vital infrastructure, homes, businesses,
and other property, could make it difficult for BPOP to maintain
stable asset quality, positive core earnings, and improving
deposit funding metrics, in line with Fitch expectations for the
current rating level.
Historically, BPOP's ratings have incorporated the significant
challenges posed by the weak operating environment in Puerto Rico.
However, going forward, Fitch expects the destruction caused by
Hurricane Maria to further weaken the operating environment. Fitch
also expects the hurricane's impact will complicate the
Commonwealth of Puerto Rico's efforts to reverse outward
migration, generate sustainable economic growth, and address its
fiscal and debt imbalances.
SUPPORT RATING AND SUPPORT RATING FLOOR
The Support Rating of '5' and Support Ratings Floor of 'NF'
reflect Fitch's view that BPOP is not considered systemically
important, and therefore the probability of support is unlikely.
The IDRs and VRs do not incorporate any support.
LONG- AND SHORT-TERM DEPOSIT RATINGS
BPOP's uninsured deposit ratings at its subsidiary banks are rated
one notch higher than BPOP's IDR and senior unsecured debt rating
because U.S. uninsured deposits benefit from depositor preference.
U.S. depositor preference gives deposit liabilities superior
recovery prospects in the event of default.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
Hybrid capital instruments issued by BPOP are notched down from
the company's VR in accordance with Fitch's assessment of each
instrument's respective non-performance and relative loss severity
risk profiles, which may vary considerably.
BPOP's preferred stock and trust preferred stock rating at 'B-' is
three notches below its Viability Rating (VR) of 'bb-', in
accordance with Fitch's assessment of the instruments' non-
performance and loss severity risk profiles for issuers that have
VRs rated below 'bb+'.
HOLDING COMPANY
BPOP has a bank holding company (BHC) structure with the bank as
the main subsidiary. IDRs and VRs are equalized with those of the
operating companies and banks, reflecting its role as the bank
holding company, which is mandated in the U.S. to act as a source
of strength for its bank subsidiaries. Double leverage is below
120% for the BPOP parent company.
SUBSIDIARY AND AFFILIATED COMPANIES
All of the BPOP entities factor in a high probability of support
from the parent. This reflects the fact that performing parent
banks have very rarely allowed subsidiaries to default. It also
considers the high level of integration, brand, management,
financial and reputational incentives to avoid subsidiary
defaults.
RATING SENSITIVITIES
IDRs, VRs, AND SENIOR DEBT
Fitch expects to resolve the Rating Watch Negative within the next
six months. Fitch also expect that the bank's quarterly financial
results as well as disclosures from the U.S. Federal Government
and the Commonwealth of Puerto Rico will bring greater visibility
into the potential short- and long-term effects that this
unprecedented event may have on financial performance and
ultimately the company's ratings.
SUPPORT RATING AND SUPPORT RATING FLOOR
The Support Rating and Support Rating Floor are sensitive to
Fitch's assumption around capacity to procure extraordinary
support in case of need.
LONG- AND SHORT-TERM DEPOSIT RATINGS
The ratings of long- and short-term deposits issued by BPOP
subsidiaries are primarily sensitive to any change in the
company's IDRs. This means that should the Long-Term IDR be
downgraded, deposit ratings could be similarly affected.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
The ratings of hybrid securities are sensitive to any change in
BPOP's VR or to changes in BPOP's propensity to make coupon
payments that are permitted but not compulsory under the
instruments' documentation.
HOLDING COMPANY
If BPOP became undercapitalized or increased double leverage
significantly, there is the potential that Fitch could notch the
holding company IDR and VR from the ratings of the operating
companies.
SUBSIDIARY AND AFFILIATED COMPANIES
As the IDRs and VRs of the subsidiaries are equalized with those
of BPOP to reflect support from their ultimate parent, they are
sensitive to changes in the parent's propensity to provide
support, which Fitch currently does not expect, or from changes in
BPOP's IDRs.
Fitch has placed the following ratings on Rating Watch Negative:
Popular, Inc.
-- Long-term IDR 'BB-';
-- Senior unsecured 'BB-';
-- Short-term IDR 'B';
-- Short-term Debt 'B'.
-- Viability rating 'bb-';
-- Preferred stock 'B-'.
Popular North America, Inc.
-- Long-term IDR 'BB-';
-- Senior unsecured 'BB-';
-- Short-term IDR 'B';
-- Short-term Debt at B
-- Viability rating 'bb-'.
Banco Popular North America
-- Long-term IDR 'BB-';
-- Long-term deposits 'BB';
-- Short-term IDR 'B';
-- Short-term deposits 'B'.
-- Viability rating 'bb-'.
Banco Popular de Puerto Rico
-- Long-term IDR 'BB-';
-- Short-term IDR 'B';
-- Short-term deposits 'B';
-- Viability rating 'bb-'.
BanPonce Trust I
-- Trust preferred 'B-'.
Popular Capital Trust I
-- Trust preferred 'B-'.
Popular Capital Trust II
-- Trust preferred 'B-'.
Popular North America Capital Trust I
-- Trust preferred 'B-'.
Popular Capital Trust III
-- Trust preferred 'B-'
Fitch has affirmed the following ratings:
Popular, Inc.
-- Support '5'
-- Support floor 'NF'.
Popular North America, Inc.
-- Support '5'
-- Support floor 'NF'.
Banco Popular North America
-- Support '5'
-- Support floor 'NF'.
Banco Popular de Puerto Rico
-- Support '5'
-- Support floor 'NF'.
================================
T R I N I D A D & T O B A G O
================================
TRINIDAD & TOBAGO: Insurers Facing Higher Premiums
--------------------------------------------------
Trinidad Express reports that the Association of Trinidad and
Tobago insurance Companies (ATTIC) said reinsurers who do business
within the Caribbean have been issuing advisories to the regional
insurance industry to plan for much higher rates during the
upcoming renewal of their reinsurance programs.
Insurance companies purchase reinsurance policies as a means of
mitigating the risk of having to make huge payouts for unexpected
disasters, according to Trinidad Express.
=================
X X X X X X X X X
=================
* BOND PRICING: For the Week From Oct. 2 to Oct. 6, 2017
--------------------------------------------------------
Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
BA-CA Finance Cayman Lt 0.518 62.07 KY EUR
AES Tiete Energia SA 6.7842 1.109 4/15/2024 BR BRL
Argentina Bogar Bonds 2 39.36 2/4/2018 AR ARS
Automotores Gildemeister 8.25 73.25 5/24/2021 CL USD
Automotores Gildemeister 6.75 67 1/15/2023 CL USD
Automotores Gildemeister 8.25 73.25 5/24/2021 CL USD
Automotores Gildemeister 6.75 65.5 1/15/2023 CL USD
CA La Electricidad 8.5 63.664 4/10/2018 VE USD
Caixa Geral De Depositos 1.439 63.167 KY EUR
Caixa Geral De Depositos 1.469 KY EUR
CSN Islands XII Corp 7 68 BR USD
CSN Islands XII Corp 7 66.266 BR USD
Decimo Primer Fideicomiso 6 53.225 10/25/2041 PA USD
Decimo Primer 4.54 43.127 10/25/2041 PA USD
Dolomite Capital 13.217 73.108 12/20/2019 CN ZAR
Enel Americas SA 5.75 56.172 6/15/2022 CL CLP
Gol Linhas Aereas SA 10.75 35.861 2/12/2023 BR USD
Gol Linhas Aereas SA 10.75 35.601 2/12/2023 BR USD
Inversora Electrica 6.5 67.625 9/26/2017 AR USD
Inversora Electrica 6.5 67.625 9/26/2017 AR USD
MIE Holdings Corp 7.5 64.78 4/25/2019 HK USD
MIE Holdings Corp 7.5 64.982 4/25/2019 HK USD
NB Finance Ltd 3.88 61.816 2/7/2035 KY EUR
Noble Holding 7.7 74.433 4/1/2025 KY USD
Noble Holding 5.25 56.279 3/15/2042 KY USD
Noble Holding 8.7 71.881 4/1/2045 KY USD
Noble Holding 6.2 60.129 8/1/2040 KY USD
Noble Holding 6.05 58.38 3/1/2041 KY USD
Odebrecht Finance Ltd 7.5 42.5 KY USD
Odebrecht Finance Ltd 5.125 56.938 6/26/2022 KY USD
Odebrecht Finance Ltd 7 68.053 4/21/2020 KY USD
Odebrecht Finance Ltd 7.125 41.366 6/26/2042 KY USD
Odebrecht Finance Ltd 4.375 40.002 4/25/2025 KY USD
Odebrecht Finance Ltd 5.25 39.211 6/27/2029 KY USD
Odebrecht Finance Ltd 6 44.75 4/5/2023 KY USD
Odebrecht Finance Ltd 5.25 39.018 6/27/2029 KY USD
Odebrecht Finance Ltd 7.5 42.95 KY USD
Odebrecht Finance Ltd 4.375 40.363 4/25/2025 KY USD
Odebrecht Finance Ltd 7.125 41.635 6/26/2042 KY USD
Odebrecht Finance Ltd 6 52.625 4/5/2023 KY USD
Odebrecht Finance Ltd 5.125 55.873 6/26/2022 KY USD
Odebrecht Finance Ltd 7 67.368 4/21/2020 KY USD
Petroleos de Venezuela 8.5 74.5 10/27/2020 VE USD
Petroleos de Venezuela 6 30.458 5/16/2024 VE USD
Petroleos de Venezuela 6 30.517 11/15/2026 VE USD
Petroleos de Venezuela 9.75 35.677 5/17/2035 VE USD
Petroleos de Venezuela 9 39.279 11/17/2021 VE USD
Petroleos de Venezuela 5.375 30.267 4/12/2027 VE USD
Petroleos de Venezuela 8.5 72.5 10/27/2020 VE USD
Petroleos de Venezuela 12.75 45.278 2/17/2022 VE USD
Petroleos de Venezuela 6 30.367 5/16/2024 VE USD
Petroleos de Venezuela 6 30.387 11/15/2026 VE USD
Petroleos de Venezuela 9 39.316 11/17/2021 VE USD
Petroleos de Venezuela 9.75 35.893 5/17/2035 VE USD
Petroleos de Venezuela 6 28.346 10/28/2022 VE USD
Petroleos de Venezuela 5.5 30.123 4/12/2037 VE USD
Petroleos de Venezuela 12.75 45.23 2/17/2022 VE USD
Polarcus Ltd 5.6 75 3/30/2022 AE USD
Provincia del Chubut 4 10/21/2019 AR USD
Siem Offshore Inc 4.04527 69.5 10/30/2020 NO NOK
Siem Offshore 3.75176 65.75 12/28/2021 NO NOK
STB Finance 2.05771 56.243 KY JPY
Sylph Ltd 2.367 64.438 9/25/2036 KY USD
US Capital 1.63611 54.774 12/1/2039 KY USD
US Capital 1.63611 54.774 12/1/2039 KY USD
USJ Acucar 9.875 67 11/9/2019 BR USD
USJ Acucar 9.875 67 11/9/2019 BR USD
Venezuela 13.625 68.25 8/15/2018 VE USD
Venezuela 7.75 44.065 10/13/2019 VE USD
Venezuela 11.95 40.785 8/5/2031 VE USD
Venezuela 12.75 45.19 8/23/2022 VE USD
Venezuela 9.25 39.645 9/15/2027 VE USD
Venezuela 11.75 40.005 10/21/2026 VE USD
Venezuela 9 36.285 5/7/2023 VE USD
Venezuela 9.375 37.69 1/13/2034 VE USD
Venezuela 13.625 72.25 8/15/2018 VE USD
Venezuela 7 34.23 3/31/2038 VE USD
Venezuela 7 59.19 12/1/2018 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, 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 Joseph Cardillo at
856-381-8268.
* * * End of Transmission * * *