/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/210816.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, August 16, 2021, Vol. 22, No. 157 Headlines B R A Z I L BRADESCO SEGUROS: Fitch Affirms 'BB' IFS, Outlook Negative C H I L E CHILE: Gets $120MM IDB Aid to Improve People's Living Conditions D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Food Prices Soar Again DOMINICAN REPUBLIC: Gov't. Accelerates Chicken Production DOMINICAN REPUBLIC: Gov't. Orders Slaughter of Pigs Due to ASF E C U A D O R BANCO DEL AUSTRO: Fitch Publishes 'CCC+' LT IDR J A M A I C A CARIBBEAN CEMENT: Long-term Debt Shrinks to $500MM as of June 30 M E X I C O CRABI S.A.: A.M. Best Cuts Fin'l. Strength Rating to C+(Marginal) V E N E Z U E L A VENEZUELA: Currency to Lose 6 Zeros Effective Oct. 1 X X X X X X X X [*] BOND PRICING: For the Week Aug. 9 to Aug. 13, 2021 - - - - - =========== B R A Z I L =========== BRADESCO SEGUROS: Fitch Affirms 'BB' IFS, Outlook Negative ---------------------------------------------------------- Fitch Ratings has affirmed Bradesco Seguros S.A.'s Insurer Financial Strength (IFS) at 'BB' with a Negative Outlook. The National IFS rating of Bradesco Seguros has also been affirmed at 'AAA(bra)' and the Outlook for this rating remains Stable. The rating reflects the company's strategic importance to its parent Banco Bradesco, of which Bradesco Seguros is a core subsidiary. KEY RATING DRIVERS Bradesco Seguros' ratings are aligned with those of its parent, Banco Bradesco S.A. (Bradesco, Local Currency Long-Term IDR BB/Negative). The Outlook for Bradesco Seguros' IFS rating mirrors that of its parent's Long-Term Local Currency IDR, which, in turn remains one notch above Brazil's sovereign rating (Long-Term Local Currency IDR 'BB-'/Negative). Fitch views Bradesco Seguros as a 'core subsidiary' of Bradesco, and therefore its ratings are equalized with those of its parent. This is based on the strategic importance of its Bradesco Seguros insurance operations which complement the main retail banking activities, common branding and high contribution of Bradesco Seguros to group profits. The insurance company has consistently contributed about 27% of the bank's consolidated earnings historically. The ratings also reflect the company's leading position in the Brazilian insurance market, consistent performance through the cycles, diversified revenue base, strong distribution capacity underpinned by Bradesco's wide agency network and comfortable liquidity and capitalization ratios. At year-end 2020, life and pension segments remained the largest contributors to gross written premiums (58%) in 2020, followed by health (24%), property/casualty (P/C, 9%), and savings bonds (9%). In 2020, premiums written decreased by around 24%, mainly due to the partial spin-off of health operations from Bradesco Seguros to the parent company Bradseg Participations in July 2020. The health business lines continue to be reflected in the group's overall insurance business results. The company's leverage ratios were pressured in 2020 when compared with the same period in 2019, due to a significant capital reduction made by the insurer given the partial spin-off of equity. Despite this, operational and asset leverage ratio remains strong compared with Fitch's international life insurer company benchmark ranges. At the end of 2020, the indicators were 4.2x and 21.7x, respectively. The profitability presented by Bradesco Seguros in 2020 was below the results of previous years, with a return on equity of 21% while the average index between 2017 and 2019 is 27%. Net income performance was mainly impacted by the behavior of economic ratios and adverse impacts of the pandemic. Despite this, the company has a solid and consistent record of technical results through the cycles. This reflects its sound underwriting skills, control systems and pricing practices. In 2020 Bradesco Seguros' investment portfolio remained concentrated on Brazilian government securities, which made up 88% of the total exposure. The company's liquidity remains adequate, with all the regulatory minimum liquidity ratios comfortably met. In applying Fitch's insurance criteria regarding the impact of ownership on Bradesco Seguros' ratings, Fitch considered how the ratings would theoretically be impacted under Fitch's bank support criteria. Fitch's insurance criteria is principles based regarding ownership, and the referenced bank criteria was used to help inform Fitch's judgment in applying those principles. Bradesco Seguros proved the resilience of the standalone financial profile against the financial impact caused by the coronavirus and the insurance group presented a positive performance in 2020 and in the first six months of 2021. However, since Bradesco Seguros ratings are directly linked to those of Banco Bradesco, any deterioration in the bank's credit profile would be most influential on the insurance company ratings. The Negative Outlook on the ratings of Banco Bradesco, and in turn Bradesco Seguros, reflects risks to fiscal consolidation and economic recovery needed for medium-term public debt stabilization following the sharp deterioration in Brazil's fiscal accounts and public debt burden in 2020, particularly in light of the uncertain evolution of the pandemic, the vaccination process and economic fallout. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Bradesco Seguros' IFS rating has limited upside potential, as they are equalized to those of Banco Bradesco, whose ratings capture constraints from its operating environment. Over the medium term, the ratings could benefit from stabilization and eventual improvement of Fitch's assessment of the operating environment for Brazilian banks. -- For the national scale rating, this sensitivity is not applicable, given that the National IFS rating of Bradesco Seguros was affirmed at 'AAA(bra)'. Factor that could, individually or collectively, lead to negative rating action/downgrade: -- Bradesco Seguros' ratings are linked to that of Banco Bradesco. Therefore, any negative change in the bank's ratings would affect the insurer's ratings, as would a change in its willingness to provide support, which Fitch considers highly unlikely. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS The rating of Bradesco Seguros is directly linked to the IDR of Banco Bradesco, the ultimate parent company. ESG CONSIDERATIONS 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. ========= C H I L E ========= CHILE: Gets $120MM IDB Aid to Improve People's Living Conditions ---------------------------------------------------------------- Chile will expand its program to prevent the formation of informal settlement with $120 million in funding from the Inter-American Development Bank (IDB). The project's goal is to reduce the number of people living in "campamentos," as informal settlements are known in Chile. It will include measures to prevent the formation of new campamentos and the expansion or repopulation of precarious settlements located in areas vulnerable to climate threats. Specifically, the national registry of precarious settlements will be strengthened to identify disaster risks and vulnerable populations, and a periodic monitoring system for the growth of such settlements will be implemented. Rent subsidies will also be assigned to families that are susceptible to settling in campamentos as well as to the registered migrant population. The program also addresses the socio-urban integration of campamento households. A purchasing model will be implemented to fund a soil bank with high regional well-being indicators and criteria for reducing climate risk in the provision of housing solutions for families in precarious conditions. In addition, urban planning works and subsidies will focus on offering eco-efficient housing and urban infrastructure solutions. The loan will also help strengthen the Chilean Government's Campamento Program to articulate intersectoral actions that promote the social and economic inclusion of citizens as well as immigrants who have formalized or are in the process of formalizing their legal status. By the end of four years, the program is expected to benefit more than seven thousand households with better living conditions. With more than 87% of its population residing in cities, Chile faces housing deficits as a result of a lack of affordable housing for lower-income segments. The sustained increase in migration flows, together with the high degree of vulnerability of immigrant populations, has added to the number of households living in informal settlements. The $120 million in aid is in the form of a $100 million loan and $20 million grant from the IDB's non-reimbursable fund to support countries that receive large-scale, sudden intraregional migration flows. =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Food Prices Soar Again ------------------------------------------ Dominican Today reports that although inflation in the Dominican Republic has begun to decline after experiencing its highest peak in May, with 10.48% compared to the same month of 2020, still several foods that have a lot of presence in the basic basket continue to rise in price. Among them are fresh chicken, which last July rose 1.90% and was among the products that contributed the most to the 0.91% increase recorded in the price index of the food and non-alcoholic beverages group, according to the report of the monthly variation of the consumer price index (CPI) of the Central Bank (BCRD) corresponding to last month, according to Dominican Today. "The chicken went up a lot, a lot, a lot. In the pollera they are selling it at RD$65," complained a colmadero who sold the pound at RD$80, the report notes. Merchants consulted during a tour of some markets in the National District and Santo Domingo agreed. "Everything is going up, the chicken is at RD$75, things are difficult," said Juan de Dios, who trades this meat in the Villas Agricolas sector, the report relays. Juan believes that chicken is in short supply because before he used to buy 100 units a day and currently only sells about 25, supposedly due to the lack of supplies, according to farmers, the report relays. He said, however, that although the chicken has gone up in price, it is selling as usual, the report notes. The Dominican Price Information System (SDIP) records the pound of processed chicken at a maximum of RD$79 in supermarkets and RD$75 in markets, the report discloses. Increased Demand In African swine fever (ASF) in the country, the demand for chicken has increased because, although this disease does not affect humans, pork consumption has decreased, the report relays. Demand has been so high that some supermarkets began to limit the amount of chicken their customers could buy, the report notes. Faced with this situation, Listin Diario proposed through an editorial that the government offer exceptional support to poultry farmers to maintain production and meet the demand to control the rise in prices, the report says. Although several times an attempt was made to obtain the opinion of The Minister of Agriculture, Limber Cruz, on this proposal, it was not possible, the report discloses. We were only told that the Minister would issue a public statement on the matter, the report relays. Other Products Have Gone Up To the increase of chicken in the country, other food products of daily consumption such as garlic, onion, and oil are added, which have presented significant increases in recent weeks in the different markets of the capital, the report relays. During a tour of the Duarte Avenue market and the Merca Santo Domingo, homemakers and local merchants expressed their concerns about the variation in prices of these products from the basic family basket, the report notes. "Garlic has risen to RD$145, onion varies from RD$30 a pound, depending on the quality and quantity," said Ricardo, who is a vegetable trader in the Merca, the report relates. Emilio Garcia, another of the merchants in the area, said that garlic is being offered at RD$160, while a few months ago, the pound was up to RD$90, the report discloses. He also indicated that currently, in the aforementioned market, the pound of onion is being marketed at RD$35 and that previously, it cost up to RD$20, the report says. The Central Bank report indicates that so bad bread rose 9.09% in July, water bread 7.54%. Some pork derivatives, such as smoked chop and salami, recorded 1.49% and 3.19%, respectively, the report adds. Complaints From Housewives Similarly, some housewives surveyed said that due to the increase in many of the main food products, they have had to replace food with more economical ones, the report relays. Marisela said that due to the rise in the price of chicken, she has had to stop eating it for a few days and prefers to eat vegetables to save more, the report notes. "I buy vegetables here at the Merca and we put it together with another company," he said. Adriana Rivas, another housewives surveyed, also explained that she spends more than RD$500 a day to make lunch for her family of five, the report discloses. Other consumers, such as Patricia, choose to buy beef because they consider pork unfit and expensive chicken, the report says. Cumulative Inflation In general terms, at the end of July, inflation stood at 7.88%, and the cumulative percentage of the first seven months of the year (January-July) was 4.57%, according to the Central Bank report (BCRD), the report adds. 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. Fitch Ratings on Jan. 18, 2021, assigned a 'BB-' rating to Dominican Republic's USD1.5 billion 5.3% notes due Jan. 21, 2041. Concurrently, the Dominican Republic reopened its 2030 4.5% notes for an additional USD1.0 billion, which Fitch rates 'BB-', raising the total outstanding amount of the 2030 notes to USD2.0 billion. Standard & Poor's, on December 4, 2020, affirmed its 'BB-' long-term foreign and local currency sovereign credit ratings on the Dominican Republic. The outlook remains negative. S&P also affirmed its 'B' short-term sovereign credit ratings. The negative outlook reflects S&P's view that it could lower the ratings on the Dominican Republic over the next six to 18 months, given the severe impact of the COVID-19 pandemic on the sovereign's already vulnerable fiscal and external profiles, as well as the potential for a weaker-than-expected economic recovery. 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: Gov't. Accelerates Chicken Production --------------------------------------------------------- Dominican Today reports that the Dominican Government is accelerating the production of chicken meat to supply the population and avoid speculation on its price. The Minister of Agriculture, Limber Cruz, said that production went from 18 million birds consumed to 19.3 per month, according to Dominican Today. Interviewed by Huchi Lora on El Dia program, Cruz said that an imported cargo is arriving in the country to inject it into the market and maintain price stability, the report notes. "Containers of chicken are arriving. The population need not despair, because chicken is entering and they do not have to be alarmed, there will already be a supply in the Dominican Republic," the report relays. 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. Fitch Ratings on Jan. 18, 2021, assigned a 'BB-' rating to Dominican Republic's USD1.5 billion 5.3% notes due Jan. 21, 2041. Concurrently, the Dominican Republic reopened its 2030 4.5% notes for an additional USD1.0 billion, which Fitch rates 'BB-', raising the total outstanding amount of the 2030 notes to USD2.0 billion. Standard & Poor's, on December 4, 2020, affirmed its 'BB-' long-term foreign and local currency sovereign credit ratings on the Dominican Republic. The outlook remains negative. S&P also affirmed its 'B' short-term sovereign credit ratings. The negative outlook reflects S&P's view that it could lower the ratings on the Dominican Republic over the next six to 18 months, given the severe impact of the COVID-19 pandemic on the sovereign's already vulnerable fiscal and external profiles, as well as the potential for a weaker-than-expected economic recovery. 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: Gov't. Orders Slaughter of Pigs Due to ASF -------------------------------------------------------------- Dominican Today reports that as part of the actions to control African swine fever that has been detected in the country, the Government has ordered the slaughter of at least 3,300 infected pigs, the Minister of Agriculture, Limber Cruz, reported yesterday. Only in the interventions carried out in Sanchez Ramirez (northwest), some 1,400 animals were slaughtered, but the number is changing, he indicated, because monitoring is carried out every day and the elimination of a farm that has 1,900 pigs is already on the agenda, according to Dominican Today. Since Aug. 3, the Ministry of Agriculture, in the company of other agencies, began the elimination of unaffected pigs in several provinces, the report relays. 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. Fitch Ratings on Jan. 18, 2021, assigned a 'BB-' rating to Dominican Republic's USD1.5 billion 5.3% notes due Jan. 21, 2041. Concurrently, the Dominican Republic reopened its 2030 4.5% notes for an additional USD1.0 billion, which Fitch rates 'BB-', raising the total outstanding amount of the 2030 notes to USD2.0 billion. Standard & Poor's, on December 4, 2020, affirmed its 'BB-' long-term foreign and local currency sovereign credit ratings on the Dominican Republic. The outlook remains negative. S&P also affirmed its 'B' short-term sovereign credit ratings. The negative outlook reflects S&P's view that it could lower the ratings on the Dominican Republic over the next six to 18 months, given the severe impact of the COVID-19 pandemic on the sovereign's already vulnerable fiscal and external profiles, as well as the potential for a weaker-than-expected economic recovery. 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). ============= E C U A D O R ============= BANCO DEL AUSTRO: Fitch Publishes 'CCC+' LT IDR ----------------------------------------------- Fitch Ratings has published Banco del Austro S.A.'s (Austro) Long-Term Issuer Default Rating (IDR) of 'CCC+' and Viability Rating (VR) of 'ccc+'. KEY RATING DRIVERS IDRs AND VR Austro's VR or standalone creditworthiness drives the IDR. Ecuador's sovereign rating (B-/Stable) and broader operating environment considerations highly influence Austro's VR, as Fitch expects the economic challenges on the banking system's financial performance to result in lower profitability and rising non-performing loans (NPL), due to lower payment capacity of some debtors amid the pandemic. Austro's risk appetite is also a highly important factor for the ratings. The bank's appetite for growth is higher than that of its peers and the system average. As the bank plans to duplicate its market share by 2024. In addition, risk controls are yet to be tested as new loans mature. Asset quality metrics compare unfavorably among local peers and the system average. As of June 2021, Austro's impaired loans ratio increased to 4.13%, from 2.83%, driven by the deterioration of consumer loans and the seasoning of the loans placed amid the pandemic. Further asset quality deterioration could result from the growth strategy and once the regulatory flexibility of extending the recognition of past-due loans expires (30.6% of the total portfolio previously adhered to relief programs as of 2Q21). Austro's profitability metrics have remained stable through time, but were aided during the pandemic by the relief programs. However, in 2020, the operational profit to risk-weighted assets (RWA) ratio decreased to 0.91%, from 1.41% in 2019. The deterioration reflected the lower interest income and net fees and commissions due to lower transactions and the lower loan expansion due to the pandemic and lockdowns. In 2021, operational profitability slightly improved to 1.06% of RWA, driven by an increase of 9.11% of gross loans boosted by the reactivation of the economy. Fitch expects that profitability will remain under pressure, reflecting high credit costs and lower margins. In June 2021, Austro's capitalization ratios decreased due to the strategic decision to allocate its liquidity in investments to increase profitability, which increased the RWAs. Austro's Fitch Core Capital ratio decreased to 11.35%, from 12.69%, and its regulatory capital ratio decreased to 11.84%, from 13.16% (regulatory minimum: 9%). However, capitalization remains adequate, while Fitch expects regulatory capital to remain above 11.5%, aligned with the bank's internal policies. Fitch does not expect pressure on capitalization ratios in the mid-term, given the bank's commitment to capitalizing a minimum of 80% of profit over the next five years to sustain growth. Austro's deposits increased by 13.61% during 2020 and have remained stable in 2021, despite the temporary deposit outflow at the beginning of the pandemic due to uncertainty in the operating environment. Austro's funding structure is adequate, although less diversified than that of the largest banks, with customer deposits representing 94.90% of total funding as of June 2021. The bank has made efforts to increase term deposits to provide more stability to its funding structure; as of June 2021, term deposits increased by 9.2% with a volatility of less than 4.5%. Austro's sound liquidity is also reflected in the loans to deposits ratio of 66.21%, which compares favorably among peers. SUPPORT RATING AND SUPPORT RATING FLOOR Austro's Support Rating (SR) of '5' and Support Rating Floor (SRF) of 'NF', indicate that Fitch believes that sovereign external support cannot be relied upon due to Ecuador's limited funding flexibility as well as the lack of a lender of last resort. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: IDRS AND VR -- The IDRs are sensitive to changes in the sovereign rating, or further deterioration on the local operating environment; -- The IDRs and VRs could be downgraded if deterioration in asset quality or profitability leads to a sustained decrease in Fitch Core Capital to RWAs. SUPPORT RATING AND SUPPORT RATING FLOOR -- The SR and SRF have no downgrade potential, as they are at the lowest possible level. Factors that could, individually or collectively, lead to positive rating action/upgrade: IDRS AND VR -- A rating upgrade would require improved prospects for the operating environment and sustained profitability, combined with improvements in the bank's credit quality and capitalization amid high growth. SUPPORT RATING AND SUPPORT RATING FLOOR -- Ecuador's propensity or ability to provide timely support to Austro is not likely to change given the sovereign's low sub investment-grade IDR. As such, the SR and SRF have no upgrade potential. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. SUMMARY OF FINANCIAL ADJUSTMENTS Prepaid expenses and deferred payments were included as other intangibles and deducted from Fitch Core Capital. ESG CONSIDERATIONS Banco del Austro S.A. has an ESG Relevance Score of '4' for Management Strategy. This reflects a track record of high government intervention in the Ecuadorian banking sector. Government intervention in the country's banking regulatory framework is reducing but challenges Austro's ability to define and execute its own strategy, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. 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. ============= J A M A I C A ============= CARIBBEAN CEMENT: Long-term Debt Shrinks to $500MM as of June 30 ---------------------------------------------------------------- David Rose at Jamaica Observer reports that after enduring years of sluggish results and a mountain of debt, Caribbean Cement Company Limited (CCC) has shrunk its long-term debt from $11.39 billion in 2018 to $500 million as at June 30, 2021. At the same time, the company set a new profit record, according to Jamaica Observer. CCC reported $3.09 billion in net profit over the six months which ended June 30. Its profit for all of 2020 was $3.2 billion, the report notes. The report relays that the performance is coming off a challenging decade for the cement producer which included four consecutive years of losses from 2009 to 2013. In 2013 alone, the final year of those losses, Carib Cement recorded $3.35 billion in losses, the report notes. Over the four years, the accumulated deficit of the company was $7.39 billion, the report discloses. Following a transformation lead with Mexico-based Cemex, which took over the entity in 2017 coupled with a booming construction sector, Carib Cement has returned to profitable ways with revenue topping $20.1 billion in 2020 and cement production peaking at 940,005 tonnes, the report says. In March 2021, the company produced a record 100,000 tonnes of cement, the highest for a single month, the report notes. Given the push to deal with its long-term debt, the next major hurdle before the company can consider dividends is redeeming the remaining United States-dollar preference shares owed to its direct parent company Trinidad Cement Limited (TCL), the report relays. These preference shares were issued in 2010 and 2013 as a way to remove some of the direct debt on Carib Cement's books during its year of substantial losses, the report discloses. At the end of June 2021, Carib Cement's other financial obligations which comprises of preference shares and lease liabilities stood at $2.44 billion, the report relays. Carib Cement repaid $2.03 billion in long-term debt during the quarter, the report relays. When the Jamaica Observer queried with Carib Cement about a possible timeline to clear up the preference share debt and for dividends to be considered, the company refused to speak on the matter, the report says. At the 2019 annual general meeting, former General Manager Peter Donkersloot mentioned that the company should have been on target to pay down its remaining debt by 2023 which would have made the consideration of a dividend or share buyback a talking point, the report discloses. Carib Cement last paid a $0.07 dividend in June 2005. The debt repaid during the quarter would have equated to a dividend per share of $2.38, the report relays. TCL recorded a net profit attributable to shareholders of TT $19.43 million ($428.75 million) for its second quarter relative to a net loss of TT $6.31 million in the prior period, the report discloses. TCL owns cement businesses in Barbados, Grenada and other parts of the Eastern Caribbean, the report relays. TCL's segment earnings before taxation for cement was TT $133.23 million which is well ahead of TT $87 million earned in 2020, the report notes. Cemex earned US$270 million in net profit attributable to shareholders for the second quarter with the company planning to lower its leverage further in the year through the repayment of US $776 million in debt, the report relays. Operating EBITDA (earnings before interest, tax, depreciation and amortization) for the South, Central America and Caribbean segment grew from US $66 million to US $117 million, the report discloses. According to the company's earnings presentation, cement prices in the segment was two per cent higher as prices increased in Costa Rica and Jamaica, the report relays. The Dominican Republic has seen performance increase due to bagged cement while Colombia saw a 44 per cent rise in volumes due to self-construction and infrastructure albeit social unrest, the report adds. About Caribbean Airlines Caribbean Airlines Limited - http://www.caribbean-airlines.com/- provides passenger airline services in the Caribbean, South America, and North America. The company also offers freighter services for perishables, fish and seafood, live animals, human remains, and dangerous goods. In addition, it operates a duty free store in Trinidad. Caribbean Airlines Limited was founded in 2006 and is based in Piarco, Trinidad and Tobago. Caribbean Airlines is among many airlines whose business has been greatly affected in 2020 by the slowdown of international travel caused by the COVID-19 pandemic. The government of Trinidad & Tobago guaranteed a US$65 million loan for the airline, and that funding has helped with the airlines' cash flow shortfall since May 2020. In September 2020, the airline related it will be taking cost-cutting measures to help keep it afloat. The measures, which was to affect some 1,700 employees, included salary deductions, no-pay leaves and lay-offs. =========== M E X I C O =========== CRABI S.A.: A.M. Best Cuts Fin'l. Strength Rating to C+(Marginal) ----------------------------------------------------------------- AM Best has downgraded the Financial Strength Rating (FSR) to C+ (Marginal) from B (Fair), the Long-Term Issuer Credit Rating (Long-Term ICR) to "b-" (Marginal) from "bb+" (Fair) and the Mexico National Scale Rating to "bb.MX" (Fair) from "a+.MX" (Excellent) of CRABI, S.A. de C.V. (Crabi) (Mexico City, Mexico). In addition, AM Best has placed these Credit Ratings (ratings) under review with negative implications. The ratings reflect Crabi's balance sheet strength, which AM Best assesses as weak, as well as its marginal operating performance, limited business profile and marginal enterprise risk management. These rating actions reflect the deterioration of Crabi's risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio (BCAR), significant deviations in its operating performance metrics with respect to the company's original business plan, and a shortfall in the minimum paid capital regulatory requirement. These events also call into question the soundness and fundamentals of Crabi's enterprise risk management program. The under review with negative implications status indicates further pressure on the ratings and the heightened execution risk of the company's business plan considering the uncertainty of future capital contributions to support the company's operation and the ability to comply with regulatory capital requirements. Crabi is a startup company in Mexico that is authorized to underwrite property/casualty insurance in the auto line of business, beginning operations in May 2019. It is 99.9% owned by CRABI, Inc., whose sole purpose is to be an investment vehicle for Crabi, with the remainder owned by the company's CEO, Javier Orozco. As of December 2020, Crabi had the strongest level risk-adjusted capitalization as measured by BCAR; however, its risk-adjusted capitalization as of June 2021 had been pressured downward to a very weak level due to a delay in the expected capital infusion, coupled with the shortfall in the regulatory minimum paid capital. As of June 2021, Crabi's operating performance metrics stood below the projected levels due to a higher-than-projected level of claims and acquisition costs. The company is addressing these issues, but the implementation of these adjustments remains a challenge within a very competitive auto segment. Additional negative development of operating performance trends would erode the already pressured capital base further. Positive rating actions are not expected in the medium term. Negative rating actions could take place if Crabi fails to correct the current shortfall in regulatory capital requirements, which will be closely monitored by AM Best in the short term. ================= V E N E Z U E L A ================= VENEZUELA: Currency to Lose 6 Zeros Effective Oct. 1 ---------------------------------------------------- AP News reports that Venezuela said it will make a million-to-1 change in its currency soon, eliminating six zeros from prices in the local currency as hyperinflation continues to plague the troubled South American nation. Venezuela's central bank disclosed the change to the bolivar will go into effect Oct. 1, according to AP News. The new 100 bolivar bill will be the highest denomination. It is equivalent to 100,000,000 of the current bolivar, the report notes. This is the third adjustment since socialist leaders began governing Venezuela, the report relays. The bolivar lost three zeros in 2008 under now-deceased President Hugo Chavez, while his successor, Nicolas Maduro, eliminated five zeros in 2018, the report notes. Venezuela is in its sixth year of recession, the report discloses. Millions live in poverty, with high food prices that are commonly set in U.S. dollars and low wages, the report says. The 1 million bolivar bill is currently the highest denomination, but it is scarce, the report relays. More than seven of those bills are needed to buy a 1.3-gallon (5-liter) bottle of water, which cost 7.4 million bolivars or $1.84 dollars, the report adds. Venezuela Venezuela, officially the Bolivarian Republic of Venezuela, is a country on the northern coast of South America, consisting of a continental landmass and a large number of small islands and islets in the Caribbean sea. The capital is the city of Caracas. Hugo Chavez was president to Venezuela from 1999 to 2013. The Chavez presidency was plagued with challenges, which included a 2002 coup d'etat, a 2002 national strike and a 2004 recall referendum. Nicolas Maduro was elected president in 2013 after the death of Chavez. Maduro won a second term at the May 2018 Venezuela elections, but this result has been challenged by countries including Argentina, Chile, Colombia, Brazil, Canada, Germany, France and the United States who deemed it fraudulent and moved to recognize Juan Guaido as president. The presidencies of Chavez and Maduro have challenged Venezuela with a socioeconomic and political crisis. It is marked by hyperinflation, climbing hunger, poverty, disease, crime and death rates, social unrest, corruption and emigration from the country. S&P Global Ratings, in May 2019, removed its long- and short-term local currency sovereign credit ratings on Venezuela from CreditWatch with negative implications and affirmed them at 'CCC-/C'. The outlook on the long-term local currency rating is negative. At the same time, S&P affirmed its 'SD/D' long- and short-term foreign currency sovereign credit ratings on Venezuela. Moody's credit rating (long term foreign and domestic issuer ratings) for Venezuela was last set at C with stable outlook in March 2018. Meanwhile, Fitch's long term issuer default rating for Venezuela was last in 2017 at RD and country ceiling was CC. Fitch,on June 27, 2019, affirmed then withdrew the ratings due to the imposition of U.S. sanctions on Venezuela. =============== X X X X X X X X =============== [*] BOND PRICING: For the Week Aug. 9 to Aug. 13, 2021 ------------------------------------------------------ Issuer Name Cpn Price Maturity Country Curr ----------- --- ----- -------- ------- --- KrisEnergy Ltd 4.0 40.4 6/9/2022 SG SGD Metrogas SA/Chile 6.0 41.6 8/1/2024 CL CLP Corp Universidad de Co 5.9 64.2 11/10/2021 CL CLP Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD Cia Latinoamericana de 9.5 73.9 7/20/2023 AR USD Avadel Finance Cayman 4.5 55.0 2/1/2023 US USD Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD Sylph Ltd 2.4 65.1 9/25/2036 KY USD Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD Cia Latinoamericana de 9.5 74.3 7/20/2023 AR USD Noble Holding Internat 6.1 62.0 3/1/2041 KY USD Provincia del Chaco Ar 4.0 0.0 12/4/2026 AR USD Provincia de Buenos Ai 7.9 75.3 6/15/2027 AR USD Noble Holding Internat 6.2 62.2 8/1/2040 KY USD Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD Provincia de Cordoba 7.1 74.7 8/1/2027 AR USD YPF SA 16.5 67.3 5/9/2022 AR ARS Province of Santa Fe 6.9 74.7 11/1/2027 AR USD Polarcus Ltd 5.6 71.8 7/1/2022 AE USD AES Tiete Energia SA 6.8 1.2 4/15/2024 BR BRL Enel Americas SA 5.8 32.7 6/15/2022 CL CLP Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD City of Cordoba Argent 7.9 73.1 9/29/2024 AR USD Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD Esval SA 3.5 49.9 2/15/2026 CL CLP Provincia de Rio Negro 7.8 70.4 12/7/2025 AR USD Noble Holding Internat 5.3 60.5 3/15/2042 KY USD Provincia de Cordoba 7.1 72.7 8/1/2027 AR USD Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD Province of Santa Fe 6.9 74.7 11/1/2027 AR USD Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD Cia Energetica de Pern 6.2 1.1 1/15/2022 BR BRL Banco Macro SA 17.5 65.2 5/8/2022 AR ARS Argentina Bonar Bonds 7.6 74.4 4/18/2037 AR USD Empresa Electrica de l 2.5 63.8 5/15/2021 CL CLP Argentine Republic Gov 7.1 75.7 6/28/2117 AR USD Provincia del Chaco Ar 9.4 74.8 8/18/2024 AR USD Argentine Republic Gov 0.5 27.6 12/31/2038 AR JPY Banco Macro SA 17.5 65.2 5/8/2022 AR ARS Automotores Gildemeist 6.8 54.9 1/15/2023 CL USD Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD YPF SA 16.5 67.3 5/9/2022 AR ARS Provincia del Chubut A 4.5 2208 3/30/2021 AR USD Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD Argentine Republic Gov 6.9 75.2 1/11/2048 AR USD Argentina Bonar Bonds 5.8 75.2 4/18/2025 AR USD Argentine Republic Gov 4.3 70.0 12/31/2033 AR JPY Automotores Gildemeist 6.8 54.9 1/15/2023 CL USD Province of Santa Fe 6.9 75.2 11/1/2027 AR USD Argentine Republic Gov 6.3 74.1 11/9/2047 AR EUR Fospar S/A 6.5 1.2 5/15/2026 BR BRL YPF SA 16.5 67.3 5/9/2022 AR ARS Automotores Gildemeist 8.3 54.2 5/24/2021 CL USD Province of Santa Fe 6.9 75.2 11/1/2027 AR USD ********* 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 2021. 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 * * *