/raid1/www/Hosts/bankrupt/TCRLA_Public/220323.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
Wednesday, March 23, 2022, Vol. 23, No. 53
Headlines
A R G E N T I N A
ARGENTINA: Might Limit Agricultural Exports to Curb Inflation
B R A Z I L
BRAZIL: Brazilian and US Interest Rate Gap Biggest in Six Years
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: Gov't. Enters Deal to Guarantee Price Stability
J A M A I C A
EXPRESS CATERING: Incurs US$321,000 Loss for Quarter Ended Nov.
M E X I C O
GRUPO AEROPORTUARIO: Refinanced Debt for $191 Million
P E R U
CORPORACION FINANCIERA: S&P Lowers Sub. Notes Rating to 'BB+'
[*] PERU: Exports Shrink by 5.5% in January 2022
P U E R T O R I C O
PUERTO RICO: Exits Bankruptcy But PREPA Still Struggling With Debt
- - - - -
=================
A R G E N T I N A
=================
ARGENTINA: Might Limit Agricultural Exports to Curb Inflation
-------------------------------------------------------------
Juan Martinez at Rio Times Online reports that the Argentine
government is expected to announce a package of measures that
President Alberto Fernandez calls a "war on inflation" and that
includes export restrictions on several products.
According to Argentine media, the restrictions will not affect
corn, wheat and soybeans, but derivatives such as soybean oil and
flour, for which the export tax (retenciones) will be raised from
31% to 33%, the report notes.
If confirmed, the measures would have the effect of increasing tax
revenues and expanding product supply in the domestic market,
theoretically leading to a decline in prices, according to Rio
Times Online.
The government is trying to supply the domestic market to contain
rising prices after inflation surged in February, the report
relays. The agreement with the IMF, which will be formally
presented, includes an inflation target, the report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Alberto Angel Fernandez is
the current president of Argentina after winning the October 2019
general election. He succeeded Mauricio Macri in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
Standard & Poor's credit rating for Argentina stands at CCC+ with
stable outlook, which was a rating upgrade issued on Sept. 8,
2020.
Moody's credit rating for Argentina was last set at Ca on Sept.
28, 2020. Fitch's credit rating for Argentina was last reported on
Sept. 11, 2020 at CCC, which was a rating upgrade from CC. DBRS'
credit rating for Argentina is CCC, given on Sept. 11, 2020.
As reported by The Troubled Company Reporter - Latin American, DBRS
noted that the recent upgrade in Argentina's ratings (September
2020) follows the closing of two debt restructuring agreements
between the Argentine government and private creditors. The first
restructuring involved $65 billion in foreign-law bonds. The deal
achieved the requisite participation necessary to trigger the
collective action clauses and finalize the restructuring on 99% on
the aggregate principal outstanding of eligible bonds. DBRS added
that the debt restructurings conclude a prolonged default and
provide the government with substantial principal and interest
payment relief over the next four years.
DBRS further relayed that Argentina is also seeking a new agreement
with the International Monetary Fund (IMF) to replace the canceled
2018 Stand-by Agreement. Formal negotiations on the new financing
began in November 2020. Obligations to the IMF amount to $44
billion, with major repayments coming due in 2022 and 2023.
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B R A Z I L
===========
BRAZIL: Brazilian and US Interest Rate Gap Biggest in Six Years
---------------------------------------------------------------
Rio Times Online reports that even with the Federal Reserve (Fed),
the US Central Bank, raising the basic interest rates in the United
States again, the interest rates in Brazil went up even more and
are high enough to stop the pressures that the adjustments in the
biggest economy of the world could bring to the Brazilian exchange
rate.
On March 16, the Fed raised US interest rates by 0.25 points, notes
the report.
According to Bloomberg News, Brazil's central bank was forecasted
to raise its benchmark rate by 100 basis points to 11.75%, taking
the total amount of hikes over the last year to 975 basis points.
Rio Times Online said Brazilian interest rates rose earlier and
much more than those of other countries, which helps attract
capital and should hold the exchange rate at BRL5 for a longer
time.
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). S&P's 'BB-/B' long-and short-term
foreign and local currency sovereign credit ratings for Brazil were
affirmed in December 2021 with stable outlook. Fitch Ratings'
credit rating for Brazil stands at 'BB-' with a negative outlook
(November 2020). Fitch's 'BB-' Long-Term Foreign and Local
Currency Issuer Default Ratings (IDRs) has been affirmed in
December 2021. Moody's credit rating for Brazil was last set at
Ba2 with stable outlook (April 2018). DBRS's credit rating for
Brazil is BB (low) with stable outlook (March 2018).
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: Gov't. Enters Deal to Guarantee Price Stability
-------------------------------------------------------------------
Dominican Today reports that through the Ministry of Industry,
Commerce, and Mipymes (MICM), the Government announced an agreement
with the milling sector to guarantee price stability.
Bread, flour, and pasta will maintain price stability for 45 days,
according to Dominican Today.
"The MICM has reached an understanding with the wheat flour milling
companies to maintain the prices of bread, flour and pasta for a
period of at least 45 days," said Victor Ito Bisono, Minister of
Industry and Commerce, the report notes.
In addition, the Government guaranteed the delivery of funds in a
preventive manner to avoid shortages of these products, the report
relays.
"It will make a disbursement of 400 million pesos to the mills, to,
in a preventive manner, guarantee not only prices but also the
availability of bread, flour, and pasta in the local market,"
Minister Ito Bisono said, the report discloses.
To send a signal of security and strength, the minister was
accompanied by several entrepreneurs of the milling sector, the
report says.
"Highlighting the presence of [J. Rafael Nunez, Coproharina,
Molinos del Higuamo, Cesar Iglesias, Molinos Modernos and Grupo
Bocel," he stressed, the report notes.
Minister Ito Bisono made this statement while participating in a
joint press conference with Agriculture to announce the new
measures, the report relays. These announcements are part of the
actions taken by the Government of Luis Abinader to face the high
costs of food and inflation.
In the past days, the President announced other measures to face
the oil price increases and that these are not passed on to the
population, 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.
TCRLA 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, in December 2021, revised the Outlook on Dominican
Republic's Long-Term Foreign-Currency Issuer Default Rating (IDR)
to Stable from Negative and affirmed the IDRs at 'BB-'. The
revision of the Outlook to Stable reflects the narrowing of
Dominican Republic's government deficit and financing needs since
Fitch's last review resulting in the stabilization of the
government debt/GDP ratio, as well as the investment-driven
economic momentum, reflected in the faster-than-expected economic
recovery in 2021 that Fitch expects to carry into above-potential
GDP growth during 2022 and 2023.
Standard & Poor's, also in December 2021, revised its outlook on
the Dominican Republic to stable from negative. S&P also affirmed
its 'BB-' long-term foreign and local currency sovereign credit
ratings and its 'B' short-term sovereign credit ratings. The
stable outlook reflects S&P's expectation of continued favorable
GDP growth and policy continuity over the next 12 to 18 months that
will likely stabilize the government's debt burden, despite lack of
progress with broader tax reforms, S&P said. A
rapid economic recovery from the downturn because of the pandemic
should mitigate external and fiscal risks.
Moody's affirmed the Dominican Republic's long-term issuer and
senior unsecured ratings at Ba3 and maintained the stable outlook
in March 2021.
=============
J A M A I C A
=============
EXPRESS CATERING: Incurs US$321,000 Loss for Quarter Ended Nov.
----------------------------------------------------------------
RJR News reports that Express Catering Limited (ECL) recorded more
losses for its second quarter ended November.
For the three months, the company suffered a US$321,000 loss,
according to RJR News.
However, this was a decline from the US$571,000 loss reported in
2020, the report notes.
Express Catering says increased visitor arrivals helped to improve
earnings, the report relays.
In a separate report, the Jamaica Observer said the
hospitality-based business, which operates several shops in the
departure area of the Sangster International Airport in Montego
Bay, St James, said it saw increased passenger figures for the
second quarter, noting this as a significant improvement which was
some 214% above that of the prior year's period. Revenue for the
quarter also climbed to US$2.5 million up from US$748,372 in 2020.
===========
M E X I C O
===========
GRUPO AEROPORTUARIO: Refinanced Debt for $191 Million
-----------------------------------------------------
Reuters reports that Mexican airport operator Grupo Aeroportuario
del Pacifico said it has refinanced its debt for $191 million, due
in January and February 2024.
The company said that with this refinancing, it extended the
current debt for two extra years, with a new maturity in January
and March 2026, according to Reuters.
It also said it signed a credit refinancing with BBVA Mexico for
$95.5 million, due in February 2024, the report notes.
"The new loan has a 48-month term from the date of its
disbursement, which will take place on March 31, 2022," the company
said, adding that the interest will be paid monthly at a fixed
annual rate of 2.45%, with a structuring fee of 20 basis points,
the report relays.
Another contract was signed, with Scotiabank Inverlat S.A, for
$95.5 million, due in January 2024, the report discloses. Interest
will be payable monthly at an annual fixed rate of 2.64%,
structuring fee of five basis points and principal payment will be
payable at the due date, the company said, the report adds.
=======
P E R U
=======
CORPORACION FINANCIERA: S&P Lowers Sub. Notes Rating to 'BB+'
-------------------------------------------------------------
S&P Global Ratings lowered its ratings on Banco de Credito del Peru
(BCP), MiBanco, Banco de La Microempresa S.A., Scotiabank Peru
S.A.A., Banco BBVA Peru, Banco Internacional del Peru S.A.A -
Interbank, Corporacion Financiera de Desarrollo S.A. (COFIDE),
Fondo Mivivienda S.A. (FMV). The outlook on all entities is now
stable. At the same time, S&P affirmed the ratings on Credicorp
Ltd. at 'BBB' and Intercorp Financial Services Inc. (IFS) at
'BBB-'. The outlook on both entities remains negative.
On March 18, 2022, S&P Global Ratings lowered its long-term
sovereign ratings on Peru--foreign currency to 'BBB' from 'BBB+'
and local currency to 'BBB+' from 'A-'. The downgrade reflects the
impact of shifting political environment on growth and sovereign
debt composition.
The rating action on the financial entities follows the downgrade
of the sovereign. S&P's ratings on Peru limit those on domestic
financial institutions, because it doesn't consider that the
entities could withstand a sovereign default scenario, given their
large exposure to the country in the form of loans and securities.
In addition, the deterioration in the sovereign's credit
fundamentals reduces its capacity to provide extraordinary
government support to the financial system and government-related
financial entities if needed.
The downgrade of Peru reflects the erosion of the institutional
assessment of the sovereign after a prolonged period of political
instability, due to continued tensions between the executive and
legislative powers. S&P said, "This has reduced the capacity to
implement timely policies to maintain growth in the medium term,
which we believe weighs on investor confidence, reducing economic
growth to a moderate pace. At the same time, we believe that
political uncertainty will limit private investment plans, while
bottlenecks to execute public spending remain."
In addition, the knock-on effect of the pandemic-related pension
withdrawals increased reliance on external financing in 2020 and
2021 led to changes in Peru's debt composition, making its debt
profile more vulnerable. Foreign currency-denominated debt is now
54% of the total (from just above 30% prior to the pandemic), and
nonresident holdings of commercial debt account for more than 70%.
BCP
S&P said, "The stable outlook on BCP reflects the outlook on Peru,
and our expectation that the ratings on the bank will move in
tandem with those on the sovereign in the next 12-24 months because
of BCP's high exposure to the domestic market. The negative trend
in the economic risk in our BICRA of Peru could weaken BCP's
capitalization metrics, resulting in a downward revision of the
bank's stand-alone credit profile (SACP), but not in the final
ratings, which are currently limited by those on the sovereign.
BCP's conservative provisioning and loan guarantees under
government programs should help slow the weakening of its asset
quality and the increase in credit losses once the deferred loans
begin to mature in the second half of the year."
Downside scenario. S&P could take a negative rating action on BCP
if it was to take a similar action on the sovereign.
Upside scenario. S&P could take a positive rating action on BCP if
it was to take a similar action on the sovereign, while the bank's
all other rating fundamentals remain unchanged. However, this
scenario seems unlikely at this point.
MiBanco
The stable outlook on MiBanco reflects the one on its owner, BCP.
Ratings on MiBanco will move in tandem with those on BCP as long as
the former remains an important subsidiary.
Scotiabank Peru
S&P said, "The stable outlook on Scotiabank Peru reflects the
outlook on Peru, and our expectation that the ratings on the bank
will move in tandem with those on the sovereign in the next 12-24
months because of its high exposure to the domestic market. We
consider the bank to be a strategically important subsidiary of
Bank of Nova Scotia (BNS), but we don't expect the entity would
receive extraordinary support from its parent in case of sovereign
distress. We expect tighter underwriting standards, adjustment of
the loan portfolio, solid provisioning levels, and government loan
guarantees to help the bank cope with the impact of deferred loans
start coming due as the second half of the year."
Downside scenario. S&P could take a negative rating action on
Scotiabank Peru if it was to take a similar action on the
sovereign.
Upside scenario. S&P could take a positive rating action on
Scotiabank Peru if it was to take a similar action on the
sovereign. However, this scenario seems unlikely at this point.
Banco BBVA Peru
S&P said, "The stable outlook on Banco BBVA Peru reflects the
outlook on Peru, and our expectation that the ratings on the bank
will move in tandem with those on the sovereign in the next 12-24
months because of its high exposure to the domestic market. We
consider the bank to be a strategically important subsidiary of
Banco Bilbao Vizcaya Argentaria S.A., but we don't expect the
entity would receive extraordinary support from its parent in case
of sovereign distress."
Downside scenario. S&P could take a negative rating action on Banco
BBVA Peru if it was to take a similar action on the sovereign.
Upside scenario. S&P could take a positive rating action on Banco
BBVA Peru if it was to take a similar action on the sovereign. But
this scenario seems unlikely at this point.
Interbank
The stable outlook on Interbank in the next 24 months reflects
S&P's expectation that it will maintain stable credit fundamentals.
A potential weakening of Interbank's intrinsic credit quality
wouldn't automatically result in a downgrade because of the
incorporation of the potential extraordinary support from the
sovereign.
Downside scenario. S&P could lower the ratings in the next 24
months following a downgrade of the sovereign, together with a
downward revision of Interbank's SACP by one notch. Also, the
rating could fall if it was to revise downward the bank's SACP by
two notches. However, both scenarios seem less likely at this
point.
Upside scenario. S&P could take a positive rating action on the
bank if it was to take a similar action on the sovereign or if
revise upward the bank's SACP, but these scenarios seem unlikely at
this point.
COFIDE
The stable outlook on COFIDE in the next 24 months reflects S&P's
view that it will remain the government's important financing tool
in its plans to restart the domestic infrastructure sector, while
COFIDE continues to be a key intermediary of loans disbursed to
small- to mid-size enterprises through the banking system.
Downside scenario. S&P could lower the ratings in the next 24
months following a downgrade of the sovereign, or if it was to
revise downward COFIDE's SACP by two notches to 'b+'. This could
occur following deterioration of COFIDE's asset quality that would
dent capitalization metrics as well.
Upside scenario. S&P could raise the ratings on COFIDE in the next
24 months if it was to upgrade the sovereign while the bank's all
rating fundamentals remain unchanged. But this scenario seems
unlikely at this point.
FMV
The stable outlook on FMV reflects that on the sovereign rating on
Peru, given S&P's view that FMV will continue to play an important
public policy role in reducing Peru's housing deficit. Therefore,
the ratings on FMV will likely move in tandem with those on the
sovereign.
Downside scenario. S&P could lower the ratings in the next 24
months following a downgrade of the sovereign, or if it revises
downward FMV's SACP by three notches to 'bb'. However, a
significant weakening of its credit profile is currently unlikely.
Upside scenario. S&P could raise the ratings on FMV in the next 24
months if we were to upgrade the sovereign, which it believes is
unlikely at this point.
Credicorp
The negative outlook on Credicorp reflects the effects of Peru's
deteriorating credit fundamentals, along with those of the
financial system, could have on the company's asset portfolio,
fundamentals, and dividend stream. Despite operations in the
region, Credicorp receives a substantial portion of dividends from
its Peruvian operations across various financial segments. However,
S&P believes this is tempered by Credicorp's substantial liquid
assets that ensures debt service coverage, even in a scenario of
low dividends.
Upside scenario. S&P could revise the outlook on Credicorp to
stable if it was to revise the banking industry economic risk trend
in BICRA to stable, while the entity's credit fundamentals remain
unchanged.
IFS
The negative outlook on IFS reflects the negative trend on the
economic risk of Peru's BICRA. We could revise the economic risk
score to a weaker category in the next 24 months, putting pressure
on IFS's risk-adjusted capital ratio. Consequently, we would revise
our assessment of IFS's capital and group credit profile,
triggering the downgrade of IFS.
Upside scenario. S&P could revise the outlook on IFS to stable in
the next 24 months if it was to revise the negative trend in the
economic risk in BICRA to stable, while the company's rating
fundamentals remain unchanged.
Environmental, Social, and Governance (ESG) Factors
ESG factors have no material influence on its credit rating
analysis of the financial institutions mentioned above.
Ratings List
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION; RATINGS AFFIRMED
TO FROM
BANCO BBVA PERU
Issuer Credit Rating BBB/Stable/A-2 BBB+/Negative/A-2
Senior Unsecured BBB BBB+
Subordinated BBB- BBB
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION; RATINGS AFFIRMED
TO FROM
SCOTIABANK PERU S.A.A.
Issuer Credit Rating BBB/Stable/A-2 BBB+/Negative/A-2
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION; RATINGS AFFIRMED
TO FROM
BANCO DE CREDITO DEL PERU
Issuer Credit Rating BBB/Stable/A-2 BBB+/Negative/A-2
Senior Unsecured BBB BBB+
Subordinated BBB- BBB
BANCO DE CREDITO DEL PERU, PANAMA BRANCH
Subordinated BBB- BBB
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION; RATINGS AFFIRMED
TO FROM
MIBANCO, BANCO DE LA MICROEMPRESA S.A.
Issuer Credit Rating BBB/Stable/A-2 BBB+/Negative/A-2
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION
TO FROM
BANCO INTERNACIONAL DEL PERU S.A.A - INTERBANK
Issuer Credit Rating BBB-/Stable/-- BBB/Negative/--
Senior Unsecured BBB- BBB
Subordinated BB+
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION
TO FROM
CORPORACION FINANCIERA DE DESARROLLO S.A.
Issuer Credit Rating BBB-/Stable/A-3 BBB/Negative/A-2
Senior Unsecured BBB- BBB
Subordinated BB+ BBB-
DOWNGRADED; CREDITWATCH/OUTLOOK ACTION
TO FROM
FONDO MIVIVIENDA S.A.
Issuer Credit Rating BBB/Stable/-- BBB+/Negative/--
Senior Unsecured BBB BBB+
RATINGS AFFIRMED
CREDICORP LTD.
Issuer Credit Rating BBB/Negative/--
Senior Unsecured BBB
RATINGS AFFIRMED
INTERCORP FINANCIAL SERVICES INC.
Issuer Credit Rating BBB-/Negative/A-3
Senior Unsecured BBB-
[*] PERU: Exports Shrink by 5.5% in January 2022
------------------------------------------------
Rio Times Online reports that Peruvian exports decreased by 5.5% in
January 2022 compared to the same period in 2021.
This is due to lower volumes in the mining sector, which was
affected by social conflicts that led to the suspension of
production in several mines and transportation in land corridors,
according to the Center for World Economic and Business Research of
the Association of Exporters (CIEN-ADEX), notes Rio Times Online.
Nevertheless, US$4.1287 billion were shipped abroad, with
traditional shipments amounting to US$2.6447 billion, a decrease of
14.5%; mining amounted to US$1.8424 billion, the report discloses.
The CIEN-ADEX export report shows the decrease in products (from
2,043 to 1,982) and markets (from 166 to 153) compared between
January 2021 and the same month in 2022, the report relays. The
number of companies increased from 2,972 to 3,036, the report
adds.
=====================
P U E R T O R I C O
=====================
PUERTO RICO: Exits Bankruptcy But PREPA Still Struggling With Debt
------------------------------------------------------------------
Robert Walton of Utility Dive reports that Puerto Rico exited
bankruptcy March 15, 2022, but its electric utility, the
Puerto Rico Electric Power Authority (PREPA), is still struggling
with about $9 billion in debt and Gov. Pedro Pierluisi
canceled a plan that would have raised power rates for almost five
decades in order to pay bondholders.
Consumer advocates and the Financial Oversight and Management Board
(FOMB) for Puerto Rico supported the decision to cancel the debt
restructuring deal, which had been reached in 2019. A new agreement
is expected to be negotiated or reached through mediation, the
management board said, notes the report.
Creditors, however, are wary, the report relays. Mammoth Energy is
owed more than $340 million through a subsidiary and PREPA is
"running out of excuses," CEO Arty Straehla said in a statement.
"It is well past time for them to make their creditors whole."
PREPA's debt restructuring deal reached with bondholders in 2019
was signed in a different economic world and canceling it was the
right move, according to the FOMB, the report says.
"The global COVID-19 pandemic, rising fuel prices because of
Russia's attack on Ukraine, and rising inflation left Puerto Rico
with a different economic reality," the report quoted FOMB as
saying in a statement. The
board was formed in 2016 to oversee the island's fiscal
management.
The restructuring agreement would have cut PREPA's debt by more
than 32% and it included "significant protections" for residents
and businesses, FOMB said. But it needed approval from lawmakers,
who refused without changes to key terms in the deal, the oversight
board noted.
The canceled debt restructuring deal would have raised Puerto
Rico's electricity prices by between $0.027/kWh and $0.046/kWh for
the next 47 years, according to the Institute for Energy Economics
& Financial Analysis (IEEFA), the report relates.
"There are alternatives for ensuring that bondholders are treated
fairly without raising rates. Pierluisi needs to take a closer look
at those alternatives," IEEFA Director of Financial Analysis Tom
Sanzillo wrote in a blog post. Canceling the debt deal "was a good
decision," he said.
According to the report, Sanzillo was also critical of the island's
plan to use natural gas
as a bridge to reaching 100% renewables by 2050. "From an
electricity standpoint, the governor's plan to increase natural
gas usage 'in the short term' is illogical and impossible, given
the infrastructure investments required," he wrote.
In February, the Biden administration and Puerto Rico launched a
joint effort to accelerate the growth of renewable energy resources
and strengthen the island's grid, promising 2022 will be "a year of
action" in the territory's transition to 100% clean energy over the
next three decades, recounts the report. Billions in funding from
the Federal Emergency Management Agency (FEMA) will go to
strengthen the island's grid.
After Hurricane Maria destroyed its electric grid in 2017, Puerto
Rico signed several deals with Cobra Acquisitions, a subsidiary of
Mammoth, to restore service across the island. The company says it
was paid for some of the work, but fears amounts in arrears could
be lost through the debt restructuring process.
Mammoth says it is owed $344 million, including $117 million in
interest charges, for work completed almost three years ago.
PREPA wasn't immediately available to respond to requests for
comment.
"I think it is important that PREPA be held accountable," FOMB
member Justin Peterson said at the board's Feb. 25 meeting, the
report relays. He
noted that Mammoth CEO Straehla had discussed the situation with
him over lunch recently.
"We want to work with FEMA and work with the process and make sure
that everything that deserves to be paid is paid," Peterson said.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
and management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at
https://cases.primeclerk.com/puertorico
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
* * *
The two Title III plans of adjustment have been confirmed to date,
for the Commonwealth and COFINA debtors.
*********
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
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USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.
Copyright 2022. All rights reserved. ISSN 1529-2746.
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