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       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

          Wednesday, October 7, 2020, Vol. 21, No. 201

                           Headlines



B R A Z I L

BANCO CELETEM: Moody's Alters Outlook on Ba1 Deposit Rating to Neg.
BRAZIL: Real Remains World's Weakest Currency in 2020
BRAZIL: Unemployment Breaks Record, Affects 13.1 Million People


D O M I N I C A N   R E P U B L I C

DOMINICAN REPUBLIC: Keeps Benchmark Rate; August Prices Up 0.78%
DOMINICAN REPUBLIC: Tourism Sector Workers Return to Their Jobs


M E X I C O

MUNICIPALITY OF CORDOBA: Fitch Cuts IDR & Sr. Unsec. Rating to C


V E N E Z U E L A

PDVSA: To Install Ship-To-Ship Hub Away From Shore

                           - - - - -


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B R A Z I L
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BANCO CELETEM: Moody's Alters Outlook on Ba1 Deposit Rating to Neg.
-------------------------------------------------------------------
Moody's Investors Service affirmed all ratings and assessments of
Banco Cetelem S.A. Cetelem is rated Ba1 and Not-Prime for long and
short-term global local currency deposits, and Ba3 and Not-Prime
for long and short-term foreign currency deposits. Cetelem's long
and short-term Brazilian national scale deposit ratings of Aaa.br
and BR-1 were also affirmed. Moody's also affirmed Cetelem's
standalone baseline credit assessment (BCA) at ba3 and its adjusted
BCA at ba1. Cetelem's Ba1 long-term global local-currency deposit
rating benefits from two notches of affiliate support from its
parent bank, BNP Paribas, incorporating Moody's assessment of a
high likelihood of affiliate support. The outlook was changed to
negative, from stable.

RATINGS RATIONALE

The ratings affirmation reflects Moody's unchanged view of the
bank's standalone credit profile against the backdrop of the
economic downturn in Brazil during 2020, caused by the coronavirus
pandemic outbreak. Cetelem's ratings reflect its strong
capitalization that provide a shield against increasing pressure on
asset risk and profitability. The ratings also reflect Cetelem's
granular loan portfolio, its modest intrinsic liquidity and funding
positions as a result of its still high, although declining,
dependence on other members of the BNP Paribas group for funding.
At the same time, the ratings incorporate Moody's assessment of BNP
Paribas' high willingness to provide extraordinary financial
support to Cetelem in case of need.

Cetelem's loan book declined by 34% to BRL 6.9 billion in the
1H2020 from December 2019, primarily because of the sale of BRL 3.1
billion in payroll loans. The bank also tightened origination
standards on credit card lending, reducing that portfolio by 20%.
Low-risk payroll loans still account for 60% of the total loan
book, but an increasing share of unsecured credit card loans, which
are more vulnerable to economic downturns, in the bank's loan mix
has led to asset quality deterioration. Cetelem's problem loan
ratio worsened to 3.9% in June 2020, from 2.2% in December 2019,
although loan loss reserve coverage remained high at 217% of
problem loans.

In changing the outlook to negative, from stable, Moody's noted
that the bank's decision to sell on a more frequent basis its best
quality payroll loans to third parties will weaken asset quality
and the sustainability of earnings generation leading to a credit
profile that becomes riskier and more dependent on loan sales,
increasing earnings volatility.

As loan sales become recurrent, the volatility on its revenue
stream is likely to increase. The recognition of upfront gains as
loans are sold will only temporarily help mitigate profitability
pressures from low interest rates, the decline in credit card loans
and fee-related business volumes, and rising provisions. In
addition, Cetelem's focus on payroll loans exposes the bank to
regulatory risks, as evidenced by the reduction in payroll-lending
rates introduced by the authorities in March 2020 as part of their
credit support measures, which has compressed margins and weights
on the bank's profitability. Also, if approved, interest rate caps
on credit card loans would also hurt the bank's margins. As of June
2020, Cetelem's net income to tangible banking assets reached 1.5%,
a level that is higher than its five-year average profitability
ratio. Revenues with credit sales and deferred taxes supported such
strong profitability amid higher provisions for credit losses and
lower fee income in the period.

The new strategy of credit sales aligns to the group strategy of
maximizing capital allocation and is likely to be repeated at least
once a year. Cetelem's capitalization ratio, measured by Moody's as
tangible common equity relative to risk weighted assets, increased
by 500 basis points to 18.3% in June 2020, from December 2019. The
bank's TCE ratio is 100 basis points below its regulatory tier 1
ratio due to its deferred tax assets (DTAs), most of which Moody's
deducts from its capital calculation to reflect limited ability to
absorb losses. The capital structure provides strong
loss-absorption capacity as the bank's asset risk increases and
profitability declines.

Cetelem's funding profile reflects a strategic choice to rely on
sister bank Banco BNP Paribas Brasil S.A. (BNP Brasil, unrated) as
its main funding source. BNP manages liquidity and funding for the
Brazilian subsidiaries on a consolidated basis, with BNP Brasil
responsible for raising deposits and market funds from local market
participants. Cetelem's limited liquidity reflects the disciplined
management of its assets and liabilities, and the bank's access to
alternative funding via asset sales. Cetelem's high level of
integration and strategic coordination with its affiliates with
regards to funding and liquidity management supports Moody's view
that there is a high probability that the bank's ultimate parent
would provide extraordinary support in an event of stress.

FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS

Cetelem's outlook could be stabilized if the new strategy preserves
its asset quality and earnings stream. The ratings could be
upgraded if the bank is able to improve its profitability
significantly on a sustained basis and reduce delinquency levels.

Cetelem's ratings could be downgraded if asset risk and
profitability weaken materially, leading to permanent damage to its
capital. The bank's deposit rating, which benefits form affiliate
support, could face downward pressure if the parent company is
downgraded. A downgrade of Brazil's sovereign rating could lead to
similar action on Cetelem's foreign currency deposit ratings

METHODOLOGY USED

The principal methodology used in these ratings was Banks
Methodology published in November 2019.

Banco Cetelem S.A. is headquartered in Sao Paulo, Brazil, and
reported assets of BRL 7.6 billion and net worth of BRL 1.6 billion
as of June 30, 2020.

LIST OF AFFECTED RATINGS AND ASSESSMENTS

The following ratings and assessments of Banco Cetelem S.A. were
affirmed:

  - Long-term global local-currency deposit rating of Ba1; outlook
changed to negative, from stable

  - Short-term global local-currency deposit rating of Not Prime

  - Long-term global foreign-currency deposit rating of Ba3;
outlook stable

  - Short-term global foreign-currency deposit rating of Not Prime

  - Long-term local-currency counterparty risk rating of Baa3

  - Short-term local-currency counterparty risk rating of Prime-3

  - Long-term foreign-currency counterparty risk rating of Ba1

  - Short-term foreign-currency counterparty risk rating of Not
Prime

  - Long-term Brazilian national scale deposit rating of Aaa.br

  - Short-term Brazilian national scale deposit rating of BR-1

  - Long-term Brazilian national scale counterparty risk rating of
Aaa.br

  - Short-term Brazilian national scale counterparty risk rating of
BR-1

  - Baseline credit assessment of ba3

  - Adjusted baseline credit assessment of ba1

  - Long-term counterparty risk (CR) assessment of Baa3(cr)

  - Short-term counterparty risk (CR) assessment of Prime-3(cr)

  - Outlook changed to negative, from stable


BRAZIL: Real Remains World's Weakest Currency in 2020
-----------------------------------------------------
Richard Mann at Rio Times Online reports that with the fiscal issue
increasing the tension among investors in Brazil, the trade dollar
has closed September up 2.46 percent against the Real, quoted at
R$5.6150 on purchase and R$5.6160 on sale.

The Brazilian currency is performing much worse than the Turkish
lira, while in the accumulated 12 months, its performance is close
to the Argentine peso, according to Rio Times Online.

                           About Brazil

Brazil is the fifth largest country in the world and third largest
in the Americas.  Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.

Standard & Poor's credit rating for Brazil stands at BB- with
stable outlook (April 2020).  Moody's credit rating for Brazil was
last set at Ba2 with stable outlook (April 2018).  Fitch's credit
rating for Brazil was last reported at BB- with negative outlook
(May 2020). DBRS's credit rating for Brazil is BB (low) with stable
outlook (March 2018).

As reported in the Troubled Company Reporter-Latin America, Fitch
Ratings' outlook revision in May 2020 for Brazil to negative
reflects the deterioration of Brazil's economic and fiscal outlook,
and downside risks to both given renewed political uncertainty,
including tensions between the executive and congress, and
uncertainty over the duration and intensity of the coronavirus
pandemic.


BRAZIL: Unemployment Breaks Record, Affects 13.1 Million People
---------------------------------------------------------------
Rio Times Online reports that the reopening of trade and services
amid the pandemic has exacerbated the rise in unemployment in
Brazil, which hit a record 13.8 percent in the quarter ended in
July.

It is the highest mark recorded since the Continuous PNAD (National
Household Sample Survey) series that computes the official
unemployment in the country, began in 2012, according to Rio Times
Online.

This represents 13.1 million people in the employment lines,
according to IBGE (Brazilian Institute of Geography and Statistics)
data released on September 30, the report notes.

                           About Brazil

Brazil is the fifth largest country in the world and third largest
in the Americas.  Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.

Standard & Poor's credit rating for Brazil stands at BB- with
stable outlook (April 2020).  Moody's credit rating for Brazil was
last set at Ba2 with stable outlook (April 2018).  Fitch's credit
rating for Brazil was last reported at BB- with negative outlook
(May 2020). DBRS's credit rating for Brazil is BB (low) with stable
outlook (March 2018).

As reported in the Troubled Company Reporter-Latin America, Fitch
Ratings' outlook revision in May 2020 for Brazil to negative
reflects the deterioration of Brazil's economic and fiscal outlook,
and downside risks to both given renewed political uncertainty,
including tensions between the executive and congress, and
uncertainty over the duration and intensity of the coronavirus
pandemic.




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D O M I N I C A N   R E P U B L I C
===================================

DOMINICAN REPUBLIC: Keeps Benchmark Rate; August Prices Up 0.78%
----------------------------------------------------------------
Dominican Today reports that the Central Bank of the Dominican
Republic said that it maintains the benchmark rate at 3.00% per
year, after an "exhaustive analysis of the impact of the
coronavirus pandemic on economic activity and future evolution of
inflation."

It also said the interest rate on the permanent liquidity expansion
facility (1-day Repos) remains at 3.50% per annum and the interest
rate on remunerated deposits ('Overnight') at 2.50% per annum,
according to Dominican Today.

"In particular, the monthly variation of the consumer price index
(CPI) in August was 0.78%, while the accumulated inflation during
the first eight months of the year was 3.12%," the Central Bank
said in a statement obtained by the news agency.

"Likewise, year-on-year inflation in the country, from August 2019
to August 2020, reached 4.80%, being within the target range of
4.0% ± 1.0%, while core inflation, which excludes the most
volatile components of the basket basic, reached 4.24%, the report
notes.

                About Dominican Republic

The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district.  Luis
Rodolfo Abinader Corona is the current president of the nation.

The Troubled Company Reporter-Latin America reported in April 2019
that the Dominican Today related that Juan Del Rosario of the UASD
Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."

An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.

Standard & Poor's credit rating for Dominican Republic stands at
BB- with negative outlook (April 2020). Moody's credit rating for
Dominican Republic was last set at Ba3 with stable outlook (July
2017). Fitch's credit rating for Dominican Republic was last
reported at BB- with negative outlook (May 8, 2020).


DOMINICAN REPUBLIC: Tourism Sector Workers Return to Their Jobs
---------------------------------------------------------------
Dominican Today reports that thousands of tourism employees will
return to their jobs after the Government's call for the total
reopening of that sector from Thursday, October 1, complying with
the reactivation schedule.

However, Andres Marranzini, Executive Vice President of the
Association of Hotels and Tourism (Asonahores), explained that the
workers would be reincorporated gradually, as the hotel occupations
materialize, according to Dominican Today.

"Normally, for each room, on average, 1.2 or 1.3 employees are
activated, but that will depend a lot on whether the strategy of
opening markets and issuing countries is working," he said, the
report notes.

                About Dominican Republic

The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district.  Luis
Rodolfo Abinader Corona is the current president of the nation.

The Troubled Company Reporter-Latin America reported in April 2019
that the Dominican Today related that Juan Del Rosario of the UASD
Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."

An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.

Standard & Poor's credit rating for Dominican Republic stands at
BB- with negative outlook (April 2020). Moody's credit rating for
Dominican Republic was last set at Ba3 with stable outlook (July
2017). Fitch's credit rating for Dominican Republic was last
reported at BB- with negative outlook (May 8, 2020).




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M E X I C O
===========

MUNICIPALITY OF CORDOBA: Fitch Cuts IDR & Sr. Unsec. Rating to C
----------------------------------------------------------------
Fitch Ratings has downgraded Municipality of Cordoba's Long-Term
Foreign and Local Currency Issuer Default Ratings (IDRs) to 'C'
from 'CC'. Fitch has also downgraded the municipality's 7.875%
senior unsecured notes for USD150 million due in 2024 to 'C' from
'CC'. The bonds are rated at the same level as the municipality's
IDRs. Fitch has also lowered Cordoba's Stand-alone Credit Profile
(SCP) to 'c' from 'cc'. Fitch relied on its rating definitions to
position the municipality's ratings and SCP.

KEY RATING DRIVERS

The downgrade of Cordoba's ratings follows the municipality's
nonpayment of its 7.875% senior unsecured notes due 2024,
specifically a semiannual interest payment due Sept. 29, 2020 of
USD5.9 million. A formal notice was issued on the same date by the
municipality, stating its intentions to miss the interest payment
while it continues to engage in good faith discussions with its
noteholders for the restructuring of the City's external debt. As
stipulated on the notes' indenture, currently the municipality is
in its 30-day grace period to fully comply with its financial
obligations. The 30-day grace period will expire on Oct. 29, 2020,
and failure to pay is considered an event of default in the
transaction documents.

On Sept. 11, 2020, the City announced that it had contacted certain
holders of the Notes to sign nondisclosure agreements prior to
negotiating changing the Notes' profiles, and has started such
discussions. Fitch believes a Restricted Default could be imminent
should an agreement with bondholders not be reached before the
grace period expires.

The notes were issued for USD150 million in September 2016. The
bond is denominated in U.S. dollars and accrues a fixed interest
rate of 7.875% payable on a semi-annual basis (Mar. 29 and Sept. 29
of each year). The bond's maturity date is on Sept. 29, 2024 with
equal capital payments in the last three years (on Sept. 29, 2022,
Sept. 29, 2023, and Sept. 29, 2024). The notes are a senior
unsecured obligation of Cordoba governed by the laws of the state
of New York, and its rating is the same as the municipality's IDRs.
The proceeds were used to partially refinance debt and for public
infrastructure projects.

Cordoba's 'C' ratings reflect the municipality's overall
near-default risk situation driven by the entrance into a grace
period on its 2024 notes amid the current debt negotiation with
bondholders that might trigger an exchange offer as defined in
Fitch's distressed debt exchange (DDE) criteria. Cordoba's SCP was
also lowered to 'c' from 'cc'. Fitch has relied on its rating
definitions to position the municipality's ratings.

ESG - Governance: Municipality of Cordoba has an Environmental,
Social and Governance (ESG) Relevance Score of '5' for Creditor
Rights, revised from '3', due to the entity's deteriorated
willingness to service its debt obligations and entering a 30-days
grace period that is driving the rating action. The breach of a
formal agreement assuring the payment of debt service has
negatively impacted creditors' rights.

ESG - Governance: The municipality has an ESG Relevance Score of
'4' for Rule of Law, Institutional and Regulatory Quality and
Control of Corruption, revised from '3', considering its weak
management performance, with small progress made by the
municipality in its bond terms and conditions proposal.
Additionally, the sovereign's restructuring process and results
have an impact on the municipality's decisions and bond
restructuring process.

DERIVATION SUMMARY

Fitch positions the Municipality's ratings according the agency's
rating definitions.

KEY ASSUMPTIONS

Not applicable.

RATING SENSITIVITIES

Factors that could, individually or collectively, lead to a
positive rating action/upgrade:

  -- At the moment, Fitch doesn't foresee a positive impact in the
ratings considering the upcoming possible completion of a DDE even
if the municipality pays its interest payment within the grace
period.

Factors that could, individually or collectively, lead to a
negative rating action/downgrade:

  -- Cordoba's ratings are subject to the debt service payments
being fully fulfilled before the 30-day grace period expires;

  -- Upon the formal announcement by the municipality or their
agent of an exchange offer as defined in Fitch's Distressed Debt
Exchange Rating Criteria.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING

The principal sources of information used in the analysis are
described in the Applicable Criteria.

ESG CONSIDERATIONS

Municipality of Cordoba has an ESG Relevance Score of '4' for Rule
of Law, Institutional and Regulatory Quality and Control of
Corruption, reflecting the negative impact of the weak regulatory
framework and the national policies of the sovereign in relation to
the municipality. The municipality also has an ESG Relevance Score
of '5' for Creditor Rights due to the city's deteriorated
willingness to service its debt obligations.

Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.




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V E N E Z U E L A
=================

PDVSA: To Install Ship-To-Ship Hub Away From Shore
--------------------------------------------------
International Shipping News reports that Venezuela's state-run oil
firm Petroleos de Venezuela, S.A. (PDVSA) is informing customers
about a new hub for doing ship-to-ship transfers for exports in a
location away from shore, a shift that could mean higher costs and
less supervision, according to three sources.

More than two-thirds of Venezuela's oil exports leave from the Jose
terminal on the country's eastern coast, a large and heavily
supervised facility with two monobuoys for exports and connected
through pipelines to several crude upgraders, according to
International Shipping News.

But with U.S. sanctions, PDVSA has since 2019 facilitated more
crude exports via tanker transfers at Caquetios, an authorized
ship-to-ship (STS) hub off the western coast near its Amuay
refinery, the report notes.

Some customers that were receiving Venezuela's western crude grades
off Amuay are now being directed to a spot about 12 miles north of
Los Monjes islands in the Gulf of Venezuela, near the maritime
border with Colombia and in front of the island of Aruba, according
to the sources, the report relates.

It is not clear if the Caquetios STS area will remain in service.

PDVSA and Venezuela's oil ministry did not reply to requests for
comment.  The nation's maritime authority INEA did not immediately
respond to requests for comment.

The first vessel scheduled to receive crude at Los Monjes STS area
is the Cape Bella V, which has remained outside Venezuelan waters
waiting for a loading window, according to two of the sources and
Refinitiv Eikon vessel tracking data, the report notes.

It intends to load up to 1 million barrels of Venezuelan Merey
crude bound for an undisclosed destination, the sources added.

Edge Maritime Inc, owner and commercial manager of the Cape Bella
V, could not be reached for comment.

Some of PDVSA's customers have so far rejected the company's
proposal of moving their scheduled loading site from Amuay to Los
Monjes because it is further from Venezuela's shore, which
increases the costs of tugboat services, maritime fuel and
mandatory inspections, and also because is near the maritime border
with Colombia, which could cause diplomatic conflict, the two
sources said, the report discloses.

The Colombian government did not respond to a request for comment.

But some shipowners not willing to load in Venezuelan waters might
prefer this option to circumvent U.S. sanctions, the sources added,
the report relays.

The U.S. State Department and the U.S. Treasury Department, which
oversees sanctions, did not immediately respond to requests for
comment.

The U.S. measures have been tightened this year in a bid to force
Venezuela's President Nicolas Maduro out of power after his 2018
re-election was considered a sham by most Western nations, the
report relays.  They drove PDVSA's oil exports from June through
August to their lowest levels in almost 80 years, the report
notes.

But shipments have picked up in recent weeks, pushed up by
long-term customers lifting as many crude cargoes as possible
before a deadline imposed by Washington to wind down trade with
Venezuela and a myriad of mostly inexperienced firms receiving
PDVSA's oil, according to the Eikon data and company documents, the
report adds.

                           About PDVSA

Founded in 1976, Petroleos de Venezuela, S.A. (PDVSA) is the
Venezuelan state-owned oil and natural gas company, which engages
in exploration, production, refining and exporting oil as well as
exploration and production of natural gas.  It employs around
70,000 people and reported $48 billion in revenues in 2016.

As reported in Troubled Company Reporter-Latin America on June 3,
2019, Moody's Investors Service withdrew all the ratings of
Petroleos de Venezuela, S.A. including the senior unsecured and
senior secured ratings due to insufficient information. At the time
of withdrawal, the ratings were C and the outlook was stable.

Citgo Petroleum Corporation (CITGO) is Venezuela's main foreign
asset.  CITGO is majority-owned by PDVSA.  CITGO is a United
States-based refiner, transporter and marketer of transportation
fuels, lubricants, petrochemicals and other industrial products.

However, CITGO formally cut ties with PDVSA at about February 2019
after U.S. sanctions were imposed on PDVSA.  The sanctions are
designed to curb oil revenues to the administration of President
Nicolas Maduro and support for the Juan Guaido-headed party.



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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
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Chapman, Editors.

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