---

       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

          Friday, January 17, 2020, Vol. 21, No. 13

                           Headlines



A R G E N T I N A

BUENOS AIRES: S&P Lowers ICR to CC Over Delayed Debt Payment


B O L I V I A

BOLIVIA: Court Extends Terms of Interim Government, Legislature


B R A Z I L

OI SA: Court Approves Proposed Reorganization


C H I L E

CHILE: Seeks to Boost Good But Insufficient Trade Ties With Cuba


E C U A D O R

ECUADOR: Fitch Assigns B(EXP) Rating on $400MM Social Bond
ECUADOR: To Plan IADB-Backed $400 Million Bond for Housing


J A M A I C A

JAMAICA: BOJ Attributes Demand Spike to Movement in Exchange Rate

                           - - - - -


=================
A R G E N T I N A
=================

BUENOS AIRES: S&P Lowers ICR to CC Over Delayed Debt Payment
------------------------------------------------------------
S&P Global Ratings, on Jan. 15, 2020, lowered its long-term ratings
on the province of Buenos Aires to 'CC' from 'CCC'. The outlook is
negative.

Outlook

S&P said, "The negative outlook reflects our view that a default on
the province's foreign currency debt is virtually inevitable. On
Jan. 14, the province announced that it will delay the amortization
payment on its 2021 bond due this month. We expect the province's
access to the market and official financing and liquidity to remain
limited over the next 12 months. Argentina's economy is in
recession, inflation remains high, and the national government has
signaled it won't provide financial assistance to the province
while it is discussing its own debt management strategy with
bondholders, bankers, and the International Monetary Fund."

Downside scenario

S&P could lower the ratings to 'SD' over the coming weeks if the
province misses any upcoming debt service payment and it doesn't
expect it to pay within the grace period. The province has a
EUR26.87 million coupon due on Jan. 20, followed by a coupon of
US$27 million and the US$250 million amortization due on Jan. 26,
both for the 2021 bond. To date, it has signaled it tends to only
miss the amortization payment. Irrespective of other potential
timely payments, one missed payment constitutes a default under our
criteria.

Upside scenario

S&P could raise the ratings on the province following a clear
strategy for timely payment of its financial obligations. This
would likely need to be accompanied by policy signals to put the
province's fiscal and financial profile on a more sustainable
path.

Rationale

The downgrade reflects S&P's view that a default by the province of
Buenos Aires on its debt is virtually certain after the provincial
government stated that it expects to delay its Jan. 26 debt service
payment until May 1, 2020.

Ongoing stress in Argentina's economy and financial markets --
coupled with the sovereign's recent selective defaults (on Aug. 29,
2019 and Dec. 20, 2019) -- have diminished the province's financing
options. The province's capacity to roll over its short-term and
long-term debt has declined over the last several months. Under the
new Kicillof administration, the province has initiated a dialogue
with the bondholders with the intention of renegotiating its debt
profile to make it more sustainable over the long term and
alleviate upcoming debt service payments. The province of Buenos
Aires faces amortizations of $1.7 billion in 2020, 47% of which
corresponds to bonds issued in the international markets, and the
remainder consists of local debt instruments and intergovernmental
debt.

Additionally, access to extraordinary financing from the national
government has become less likely. President Alberto Fernandez and
Economy Minister Martin Guzman indicated on Jan. 13 that the
sovereign would not assist the province with upcoming bond
payments. Subsequently, the province announced its intent to miss
the upcoming amortization payment on Jan. 26. S&P said, "As noted
in the Outlook section, we would lower our ratings on the province
to 'SD' as soon as it misses a debt service payment. This could
include missing the Jan. 20 coupon payment (for the BPE23 bond, New
York Law) if we believe the province won't make the payment within
the applicable grace period."

The province is seeking consent and approval from 75% of
bondholders to formally delay the US$250 million amortization
payment until May 1, 2020, as per the bond prospectus. Even if the
province gets consent from 75% of the bondholders in the very short
term, we would classify any agreement as a distressed exchange.
According to our criteria, in a distressed exchange, holders accept
less than the original promise because of the risk that the issuer
won't fulfill its original obligations.

Overall, the province's new administration faces a challenging
scenario this year. S&P said, "Both the sovereign and the
province's economic growth has been sluggish over the last few
years, and we expect the province's economy to contract for the
third consecutive year in 2020. The prolonged recession hurt the
province's revenues, which we estimate to have grown below
inflation in 2019 and expect to recover only moderately in 2020. At
the same time, we expect inflation to remain high in the coming
months, which should result in ongoing social demands that could
significantly pressure the province's already fragile finances if
the administration is not able to effectively manage them.
Regarding the province's debt burden, the Argentine peso's
depreciation in 2018 and 2019 resulted in an increase in the debt
stock and debt service as a share of operating revenues. We
estimate that debt stock represented 68% of the province's
operating revenues in 2019 from 49% in 2017."

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's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.

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

  Downgraded  
  Buenos Aires (Province of)

   Issuer Credit Rating    CC/Negative/NR   CCC/Negative/NR
   Senior Unsecured        CC               CCC




=============
B O L I V I A
=============

BOLIVIA: Court Extends Terms of Interim Government, Legislature
---------------------------------------------------------------
The Latin American Herald reports that Bolivia's Constitutional
Court issued a ruling that extends the terms in office of interim
President Jeanine Anez's administration and the national
legislature until new officials in both branches of government are
sworn in following the May 3 general elections.

The court's ruling comes just a few days before those terms were
set to expire, according to The Latin American Herald.

Constitutional Court justices announced the ruling in a statement
to the media in Sucre, Bolivia's constitutional capital and the
seat of the judiciary, the report notes.

The terms in office of authorities at the sub-national level --
governors, regional lawmakers, mayors and councilors -- also will
be extended until after the swearing-in of new officials, the
report notes.

The report discloses that the justices said the court has not
modified the duration of office holders' terms established in the
constitution but instead has "sought to come up with a legal,
constitutional solution to the political vacuum that would have
existed from Jan. 23 until the swearing-in other national and
sub-national elected officials."

New general elections have been scheduled for May 3 after the
cancellation of the balloting held on Oct. 20, in which longtime
leftist President Evo Morales initially appeared to have won a
fourth term in office, the report relays.

Those elections were eventually annulled after an Organization of
American States audit - conducted amid accusations of fraud by
Bolivia's opposition, including rival candidate Carlos Mesa - found
that the results could not be validated due to "deliberate actions
that sought to manipulate" the vote count, the report says.

Morales, the first indigenous president of this poor, majority
indigenous nation, agreed to a new general election on Nov. 10
after the OAS issued its report but was forced to resign hours
later after losing the support of the military, the report notes.

Anez, a right-wing former deputy Senate leader, became next in line
for Bolivia's highest office after several of Morales' allies also
resigned, including the vice president and the leaders of the
Senate and lower house, the report notes.

Morales, who says he was forced out in a coup and currently is
living in exile in Argentina, has called for Anez to leave office
on Jan. 22, when his third term was set to expire, and for the
president of the Supreme Court, Maria Cristina Diaz, to take her
place, the report relays.

That line of succession had existed under the previous constitution
in place prior to 2009 but not under the current charter enacted
that year by Morales, the report notes.

Political enemies of the former head of state have called for the
terms in office of members of the Senate and Chamber of Deputies,
both of which are controlled by Morales' leftist MAS party, not to
be extended, the report adds.




===========
B R A Z I L
===========

OI SA: Court Approves Proposed Reorganization
---------------------------------------------
EFE News reports that a Brazilian federal judge gave his blessing
to a proposed reorganization of Oi SA, Brazil's top fixed-line
telephone operator, which declared bankruptcy in June 2016.

Though he signed off on the plan, which was approved by Oi's
creditors, Judge Fernando Cesar Ferreira imposed some conditions,
including the elimination of an annex that called for reimbursing
creditors for costs they incurred in trying to collect, according
to EFE News.

Complying with the annex would undermine efforts to put the company
back on its feet, the magistrate wrote, the report notes.

Oi sought bankruptcy protection in June 2016, sparking 18 months of
litigation that led ultimately to last month's accord with
creditors, seen as the only way of preventing liquidation or a
government takeover of the firm, the report relays.

The report notes the company owes BRL64 billion (US$20 billion) to
roughly 55,000 creditors, ranging from employees to major banks
that lent money to Oi.

The elevated indebtedness stems from a botched 2013 merger with
Portugal Telecom, a tie-up that effectively unraveled when Oi sold
Portuguese assets it had acquired from PT to Luxembourg's Altice,
the report notes.

Under the recovery plan, creditors will receive 75 percent of Oi
shares in exchange for writing off half the debt, the report
relays.

At the same time, creditors and shareholders will be asked to
inject $1.25 billion in new capital, while Oi also contemplates
raising another $781 million from capital markets, the report
discloses.

Oi, with Brazil's biggest fixed-line network, is the country's
fourth-leading mobile operator and is also a provider of broadband
Internet and cable television, the report notes.

Serving some 50 million people in all, Oi is the No. 3
telecommunications company in Latin America, the report adds.

As reported in the Troubled Company Reporter-Latin America, S&P
Global Ratings in September 2019 affirmed its global scale 'B'
issuer credit and issue-level ratings on Oi S.A. and revised the
outlook to negative from stable. At the same time, S&P lowered its
national scale rating to 'brA-' from 'brA' and assigned a negative
outlook.




=========
C H I L E
=========

CHILE: Seeks to Boost Good But Insufficient Trade Ties With Cuba
----------------------------------------------------------------
EFE News reports that Chilean President Michele Bachelet met with
Cuban leader Raul Castro and hailed the increase in trade ties
between her country and the communist island, which at present show
positive results but are still not living up to their potential,
particularly in the investments field.

President Bachelet was welcomed to the Palace of the Revolution,
Cuba's seat of government, where she met with Castro, who is also
in the final stretch of his mandate and due to hand over power to
his designated successor in April, according to EFE News.

Authorities have not yet announced what subjects the two leaders
discussed during their meeting, the report notes.

Not appearing on Bachelet's official trip agenda is any meeting or
encounter with representatives of Cuba's internal dissident
movement, a fact that sparked veiled criticism from Chile's
conservative president-elect, Sebastian Pinera, who said at a press
conference in Santiago that if he had visited Cuba he would have
met with the opposition there, the report relays.

EFE News notes that Bachelet began the second day of her state
visit to Cuba, the next-to-last foreign tour while still in office,
with the inauguration of the seminar "Trade and Investment
Perspectives: Chile-Cuba," during which government officials and
entrepreneurs will discuss the sectors in which trade ties can be
established or increased and the instruments available for doing
so.

"Chilean business owners and executives have vigorously expanded
their activities throughout Latin America with accumulated
investments above $104 billion, and Cuba should not be left out,"
the president said, the report says.

Chilean exports to the island were valued at $35 million in 2016,
double the amount in 1996, and involved more than 60 companies in
the South American country, of which 21 percent were small and
medium-sized firms, the report discloses.

Meanwhile, exports from Cuba to Chile went in a decade from $1.4
million to the $4.3 million reached in 2016, while the number of
Chilean tourists who visited the Caribbean country went from 17,500
in 2010 to 49,000 in 2015, Bachelet said, the report notes.

The president judged these figures positive but "insufficient
considering the great potential offered us by our growing trade
ties, but above all by our cooperation and friendship," the report
relays.

EFE News notes that the Chilean head of state listed the great many
opportunities in the field of investments thanks to Cuba's "new
regime of facilities and legal security for investors and, very
particularly, thanks to the Mariel Special Development Zone."

Cuba, whose state-run economy has traditionally aroused the
distrust of foreign investors for its lack of legal protection,
approved in 2014 a new Law of Foreign Investment that seeks to
resolve that problem, the report relays.

The island has also gone all out to promote its star project for
attracting foreign capital, the Mariel Special Development Zone
(ZEDM), at 45 kilometers (28 miles) west of Havana and which
includes a merchant port, container terminal and a large business
center with tax advantages, the report notes.

Like Bachelet, Cuban Foreign Trade Minister Rodrigo Malmierca said
the Cuban government isn't satisfied with the current volume of
bilateral trade because "the potential exists to improve it," the
report adds.




=============
E C U A D O R
=============

ECUADOR: Fitch Assigns B(EXP) Rating on $400MM Social Bond
----------------------------------------------------------
Fitch Ratings assigned Ecuador's USD400 million
partially-guaranteed Social Bond a 'B(EXP)' expected rating. The
Social Bond will benefit from a USD300 million partial credit
guarantee provided by the Inter-American Development Bank
(AAA/Stable) for scheduled debt service payments.

The expected rating on the Social Bond represents a one-notch
uplift above Ecuador's Long-Term Foreign-Currency Issuer Default
Rating of 'B-', reflecting Fitch's assessment that the
PCG-protected issuance would benefit from a higher recovery rate
than unsecured obligations of Ecuador in the event of a default by
the sovereign.

Fitch last affirmed Ecuador's Long-Term Foreign- Currency IDR of
'B-' on August 21, 2019 and revised the Outlook to Stable from
Negative.

KEY RATING DRIVERS

Ecuador will issue a USD400 million Social Bond in the form of
senior unsecured 144A/Reg S 15-year amortising notes to finance its
social housing programme. The Social Bond will represent general,
direct, unsecured, unsubordinated and unconditional obligations of
Ecuador, and will rank equally in terms of repayment priority with
Ecuador's existing Eurobonds. The Social Bond contemplates events
of default customarily included in the terms and conditions of
other Eurobonds issued by Ecuador in international markets.

The Social Bond will benefit from an amortising USD300 million PCG
to be provided by the IDB to the trustee representing the holders
of the Social Bond. The PCG will partially cover principal and
interest on the Social Bond in accordance with the guarantee's
amortisation schedule. The IDB's obligations under the PCG will
constitute direct, unsecured obligations.

The PCG provides enhanced potential recovery to the Social Bond
noteholders relative to other unsecured creditors. Its analysis of
the structure of the Social Bond, including the absence of
acceleration rights of the PCG, indicates that the potential
recovery on the PCG notes would be in the range of 51%-70% (in line
with a Recovery Rating of 'RR3' as outlined in its Criteria for
Evaluating Third Party Partial Credit Guarantees), above the normal
unsecured recovery rate band of 31%-50% ('RR4') which is typically
assumed for Fitch-rated entities. The enhanced recovery potential
provided by the guarantee results in a one-notch uplift for the
rating of the notes above Ecuador's Long-Term Foreign-Currency IDR
of 'B-'.

Other features of the transaction structure include:

Under a counter-guarantee agreement, any payment made by the IDB
under the PCG will constitute a loan to Ecuador. Under the
agreement, Ecuador will be required to repay any guarantee payment
made by the IDB within 180 days. Also, any repayment made by
Ecuador to the IDB under the counter-guarantee agreement will be
excluded from any recovery claim of the IDB to the Social Bond's
trust. Any rights or payments that the IDB might have to receive
payments from Ecuador through the Social Bond's trust will rank
pari passu with the Social Bond noteholders.

The purchaser of the Social Bond will be Ecuador Social Bond,
S.a.r.l. (ESB), a newly formed SPV incorporated in Luxembourg. In
turn, ESB will issue class A and class B 144A/Reg S notes, which
will be backed by the Social Bond. Interest and principal payments
on the class A notes will benefit from 100% of any calls on the
IDB's PCG. The class B notes will not benefit from the IDB PCG and
will effectively represent senior unsecured obligations of the
Ecuador sovereign.

The IDB PCG cannot be accelerated, has a fixed amortisation
schedule, and can be drawn up to a maximum amount on each payment
date. In the event of a default by Ecuador, calls on the guarantee
will be applied to partially cover interest and principal on the
Social Bond notes. Fitch believes the primary benefit of the
guarantee will be to increase the potential recovery for Social
Bond noteholders in the event of an issuer default.

RATING SENSITIVITIES

The notes' rating is sensitive to Ecuador's sovereign rating. A
change in Ecuador's Long-Term Foreign-Currency IDR would result in
a change in the notes' rating.


ECUADOR: To Plan IADB-Backed $400 Million Bond for Housing
----------------------------------------------------------
Stephan Kueffner at Bloomberg News reports that Ecuador is
preparing to sell $400 million in bonds backed by the
Inter-American Development Bank to fund the country's housing
program, according to a person with direct knowledge of the
transaction.

The so-called "social bond" will be offered to investors, said the
person, who asked not to be identified because the information
isn't public, according to Bloomberg News.  The IADB would pay
bondholders $300 million in the event of a default, the person
added, the report notes.

Ecuador, one of the first South American countries to face mass
protests last year, has struggled to meet the terms of an
International Monetary Fund deal and to lower costs to access
international capital markets -- the country's benchmark bond due
in 2029 currently yields 11.6%, among the highest of its category,
the report relates.

Social bonds are intended to provide governments with funds
earmarked for sustainable development goals, the report notes.
Ecuador's social housing fund offers loans at subsidized interest
rates to middle-income Ecuadorians, the report says.  It currently
has $138 million in assets, the report relates.

                         Construction Boost

The government of President Lenin Moreno is also trying to boost
the construction sector to help revive Ecuador's weak economy, the
report notes.  Gross domestic product contracted 0.5% in 2019,
according to IMF estimates, the report relays.

Ecuador faced unrest last year when the government cut fuel
subsidies to try to keep its $4.2 billion IMF deal on track, the
report says.  The government eventually backed down, and passed a
watered-down tax bill, the report notes.

The bond would be the first issued by the country since June, the
report relates.  Chile issued a "green sovereign bond" in June 2019
to spur investment into transportation and construction with low
carbon emissions, the report adds.

As reported in the Troubled Company Reporter-Latin America on  Dec.
19, 2019, Egan-Jones Ratings Company, on December 12, 2019,
downgraded the foreign currency and local currency senior unsecured
ratings on debt issued by Republic of Ecuador to CCC+ from B-.




=============
J A M A I C A
=============

JAMAICA: BOJ Attributes Demand Spike to Movement in Exchange Rate
-----------------------------------------------------------------
RJR News reports that the Bank of Jamaica (BOJ) said the recent
movement in the exchange rate was related to an increase in demand,
as supply conditions have remained normal.

In a release, the Central Bank said it has noted the renewed
expressions of concern by some about the pace of movement and the
availability of foreign currency, according to RJR News.

Since the start of the year the exchange rate has depreciated by
3.2%, reversing the appreciation of 2.5% that occurred last month,
the report notes.

However, the BOJ said so far this month the average daily inflows
of foreign currency into the market has been approximately US$31
million which is greater than the average daily inflows for January
2019, the report relays.

The Central Bank notes that the increase in demand is related, in
part, to restocking activities by retailers, the report notes.

In addition, the demand has increased in the context of financial
institutions buying on behalf of their customers to fund real
sector investments and planned portfolio-related transactions, the
report discloses.

The BOJ says traders have also been buying on their own account
since the start of the year to restore their foreign currency
positions, having sold more foreign currency to the market than
they bought in December, the report says.

It says it expects the foreign exchange market to revert to more
normal patterns in the near future, the report relates.

The Bank says it stands ready to take appropriate policy actions if
the need arises, the report adds.

                        About Jamaica

As reported in the Troubled Company Reporter-Latin America,  S&P
Global Ratings in September 2019 raised its long-term foreign and
local currency sovereign credit ratings on Jamaica to 'B+' from
'B'. The outlook is stable. At the same time, S&P affirmed its 'B'
short-term foreign and local currency sovereign credit ratings on
the country. S&P also raised its transfer and convertibility
assessment to 'BB-' from 'B+'.

RJR News reported in June 2019 that Steven Gooden, Chief Executive
Officer of NCB Capital Markets, warned that the increasing
liquidity in the Jamaican economy might result in heightened risk
to the financial market if left unchecked.  This, he said, is
against the background of the local administration seeking to
reduce the debt to GDP to 60% by the end of the 2025/26 fiscal
year, which will see Government repaying more than J$600 billion
which will get back into the system, according to RJR News.



                           *********


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 2020.  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.
.


                  * * * End of Transmission * * *