/raid1/www/Hosts/bankrupt/TCRLA_Public/230417.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, April 17, 2023, Vol. 24, No. 77
Headlines
A R G E N T I N A
ARGENTINA: World Bank Lines Up US$950M of Fresh Support
[*] ARGENTINA: Biden's Envoy Arrives With Messages of Support
B A R B A D O S
BARBADOS: CBB Says Balance of Payments Survey Opens Today
C O S T A R I C A
BANCO BAC SAN JOSE: Fitch Affirms LT IDR at BB, Outlook Stable
BANCO INTERNATIONAL: Fitch Affirms IDRs at 'BB-', Outlook Stable
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: DGA Affirms it's Time to Invest in Country
DOMINICAN REPUBLIC: Reduces Growth Forecast for 2023 to 4.25%
E C U A D O R
ECUADOR: Seeks $1 Bil. IMF Credit Line After Series of Disasters
X X X X X X X X
[*] BOND PRICING: For the Week April 10 to April 14, 2023
- - - - -
=================
A R G E N T I N A
=================
ARGENTINA: World Bank Lines Up US$950M of Fresh Support
-------------------------------------------------------
Buenos Aires Times reports that the World Bank has joined the list
of multilateral organisations that are lending their support to
Argentina in the wake of a punishing drought and the country's
ongoing economic crisis.
Economy Minister Sergio Massa emerged from a meeting in Washington
with the institution's new Managing Director of Operations Anna
Bjerde boosted by news of fresh financing, according to Buenos
Aires Times.
Massa wrote in a post on Twitter that he had held a "very positive
meeting" with the World Bank official and her team, who "ratified
their strong support of the institution for our country, especially
after the strong impact of the drought, which translates into
projects in preparation for May and June for US$950 million," the
report notes.
The meeting was also attended by Felipe Jaramillo, World bank
vice-president for Latin America and the Caribbean; Executive
Director for Argentina and the Southern Cone, Cecilia Nahon; and
Marianne Fay, the World Bank representative in Buenos Aires, the
report relays.
This fresh line backing is in addition to additional support
pledged by the Inter-American Development Bank (IDB), which
approved a US$200-million loan - part of a wider package of US$600
million in credit destined for investment and health projects, the
report notes.
Massa has been doing the rounds seeking fresh dollars to sustain
the Central Bank's reserves during the election year and in the
face of the decline caused by the historic drought, the report
discloses.
Argentina announced a US$500-million investment from the Saudi Fund
for Development, which will put money into food and energy
projects, including the Nestor Kirchner gas pipeline that's
expected to be finished this year, 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.
Last March 25, 2022, Argentina finalized agreement with the IMF for
a new USD44 billion Extended Funding Facility (EFF) intended to
fund USD40 billion in looming repayments of the defunct Stand-By
Arrangement (SBA), with an extra USD4 billion in up-front net
financing. This has averted the risk of a default to the IMF
and is facilitating a parallel rescheduling of Paris Club debt.
S&P Global Ratings, on March 29, 2023, lowered its long-term
foreign currency sovereign credit rating on Argentina to 'CCC-'
from 'CCC+'. S&P also affirmed its 'C' short-term foreign currency
sovereign credit rating and its 'CCC-/C' local currency ratings on
Argentina. The outlook on the long-term ratings is negative. S&P
also lowered the transfer and convertibility assessment to 'CCC-'
from 'CCC+'.
The negative outlook on the long-term ratings reflects risks
surrounding pronounced economic imbalances and policy uncertainties
before and after the 2023 national elections. Divisions across the
political spectrum constrain the sovereign's ability to implement
timely changes in economic policy. Global capital markets are
closed to Argentina. In the local market, swaps are being deployed
to manage large maturities before placing debt through traditional
auctions. The central bank continues to play a key role as a
backstop for local debt management in the secondary market. The
ongoing severe drought has exacerbated pressures in the already
disrupted foreign exchange (FX) market.
Fitch Ratings, on the other hand, downgraded Argentina's Long-Term
Foreign Currency
Issuer Default Rating (IDR) to 'C' from 'CCC-', and has affirmed
the Long-Term Local Currency IDR at 'CCC-' on March 24, 2023.
Fitch's downgrade of Argentina's rating to 'C' from 'CCC-' follows
an executive decree that forces domestic public-sector entities
into operations involving their holdings of
sovereign debt securities, which would involve unilateral exchanges
and forced currency conversion that constitute default events under
Fitch's criteria. The 'C' rating reflects Fitch's view that
default
is thus imminent. Fitch said the rating would be downgraded to
'Restricted Default' (RD) upon execution of the exchanges.
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
[*] ARGENTINA: Biden's Envoy Arrives With Messages of Support
-------------------------------------------------------------
Jorge Garcia at Noticias Argentinas reports that the number two at
the US State Department, Wendy Sherman made it known during her
visit to Buenos Aires, that Joe Biden's government in Washington
supports "negotiations between Argentina and the IMF" and that it
is necessary to "fix" the country's macroeconomic situation.
In a press conference with the local media outlets, in which the
Noticias Argentinas agency participated, Sherman declared that
"there is a programme between Argentina and the IMF and what they
are negotiating is something that the United States supports,"
according to Noticias Argentinas.
She added: "I want to congratulate Argentina on the [IMF] reviews,
which are going very well. And I think it's very important to fix
Argentina's macroeconomic situation because it's critical for the
future of the country in terms of broader reforms," the report
notes.
Biden's envoy held meetings with Foreign Minister Santiago Cafiero,
Energy Secretary Flavia Royon and members of the AmCham business
chamber while in Argentina, the report relays. She also made time
to visit the headquarters of the Asociacion Mutual Israelita
Argentina (AMIA) Jewish community, the ex-ESMA Navy Mechanics
School, which served as a clandestine detention centre during the
1976-1983 military dictatorship, and even gave a lecture at the
University of Buenos Aires (UBA), the report discloses.
Sherman arrived in Argentina to continue with the agenda drawn up
at the White House between Joe Biden and Alberto Fernandez and
their teams during the president's recent visit to Washington, the
report says.
"Our relationship is dynamic, broad and deep," the diplomat told
reports, adding that "together, Argentina and the United States can
help to provide the world with fuel and food, and our nations will
continue to be leaders in the Americas."
Sherman said that she met with Economy Minister Sergio Massa for a
discussion about "the economic challenges in Argentina, from
inflation and poverty to debt and drought," the report notes.
The US deputy secretary of state said the duo also "talked about a
more favorable environment for business and investment," the report
discloses.
When quizzed about Argentina's inability to buy fighter jets and
the current offer on the table from China, Sherman said that "there
are ongoing talks" between Argentina and the United States that
"are going in a very positive direction," the report says.
For US diplomats, Argentina is among the "like-minded" countries to
be aligned with and with that in mind, the United States is
promoting active policies with Latin America, the report relays.
Regarding Argentina's economic future, Sherman mentioned the US
Federal Reserve's rate hike and how it complicates life for the
average US citizen, but "sometimes you have to go through some pain
to get to the right place," 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.
Last March 25, 2022, Argentina finalized agreement with the IMF for
a new USD44 billion Extended Funding Facility (EFF) intended to
fund USD40 billion in looming repayments of the defunct Stand-By
Arrangement (SBA), with an extra USD4 billion in up-front net
financing. This has averted the risk of a default to the IMF
and is facilitating a parallel rescheduling of Paris Club debt.
S&P Global Ratings, on March 29, 2023, lowered its long-term
foreign currency sovereign credit rating on Argentina to 'CCC-'
from 'CCC+'. S&P also affirmed its 'C' short-term foreign currency
sovereign credit rating and its 'CCC-/C' local currency ratings on
Argentina. The outlook on the long-term ratings is negative. S&P
also lowered the transfer and convertibility assessment to 'CCC-'
from 'CCC+'.
The negative outlook on the long-term ratings reflects risks
surrounding pronounced economic imbalances and policy uncertainties
before and after the 2023 national elections. Divisions across the
political spectrum constrain the sovereign's ability to implement
timely changes in economic policy. Global capital markets are
closed to Argentina. In the local market, swaps are being deployed
to manage large maturities before placing debt through traditional
auctions. The central bank continues to play a key role as a
backstop for local debt management in the secondary market. The
ongoing severe drought has exacerbated pressures in the already
disrupted foreign exchange (FX) market.
Fitch Ratings, on the other hand, downgraded Argentina's Long-Term
Foreign Currency
Issuer Default Rating (IDR) to 'C' from 'CCC-', and has affirmed
the Long-Term Local Currency IDR at 'CCC-' on March 24, 2023.
Fitch's downgrade of Argentina's rating to 'C' from 'CCC-' follows
an executive decree that forces domestic public-sector entities
into operations involving their holdings of
sovereign debt securities, which would involve unilateral exchanges
and forced currency conversion that constitute default events under
Fitch's criteria. The 'C' rating reflects Fitch's view that
default
is thus imminent. Fitch said the rating would be downgraded to
'Restricted Default' (RD) upon execution of the exchanges.
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
===============
B A R B A D O S
===============
BARBADOS: CBB Says Balance of Payments Survey Opens Today
---------------------------------------------------------
RJR News reports that the Central Bank of Barbados (CBB) said the
annual balance of payments survey, designed to capture data related
to transactions between Barbadians and the rest of the world, will
be issued today, April 17.
The CBB said businesses that receive the survey will have until
June 9 to have it completed, according to RJR News.
CBB Governor, Dr. Kevin Greenidge, said managing the economy
becomes more challenging in the absence of accurate information
about the balance of payments, and noted that that could have
implications for the businesses themselves, the report notes.
===================
C O S T A R I C A
===================
BANCO BAC SAN JOSE: Fitch Affirms LT IDR at BB, Outlook Stable
--------------------------------------------------------------
Fitch Ratings has taken rating actions on certain BAC International
Bank, Inc.'s (BIB) subsidiaries following BIB's Long-Term Issuer
Default Rating (IDR) upgrade to 'BB+' from 'BB'. For more
information, please see the rating action "Fitch Upgrades BAC
International Bank to 'BB+'; Outlook Stable". The Rating Outlook is
Stable.
Fitch has upgraded Banco BAC San Jose, S.A.'s Long-Term Local
Currency IDR to 'BB+' from 'BB' with a Stable Outlook, two notches
above Costa Rica's sovereign rating. In turn, BAC San Jose's
Long-Term Foreign Currency IDR was affirmed at 'BB', as it is
capped by Costa Rica's Country Celling. The rating actions on BIB's
IDR have no impact on BAC San Jose's Viability Rating (VR), and its
national ratings have not been affected, as they are at the maximum
level in the national scale in Costa Rica.
Fitch has also upgraded the Long-Term National Scale ratings for
the following entities that constitute the BAC|Credomatic Guatemala
group to 'AAA(gtm)' from 'AA+(gtm)'/Outlook Stable: Banco de
América Central, S.A. (BAC Guatemala), Credomatic de Guatemala,
S.A. (Credomatic), Financiera de Capitales, S.A. (Fincapi) and BAC
Bank, Inc.
The national ratings of the subsidiaries in El Salvador and
Honduras are unaffected because they are already at the highest
level of their respective national scales.
BAC Bank, Inc.'s National ratings were withdrawn, due to
commercials reasons.
KEY RATING DRIVERS
BAC San Jose
BAC San Jose's IDRs and SSR are based on Fitch's assessment on the
support the bank would receive from its ultimate shareholder, BIB,
if needed. Fitch caps BAC San Jose's SSR and Long-Term Foreign
Currency IDR one notch above the 'BB-' Costa Rican sovereign rating
to reflect the domestic banks' exposure to country risks. The
Long-Term Local Currency IDR is not constrained by transfers and
convertibility risks, captured in the 'BB' country ceiling, which
could limit BIB's ability to provide support or BAC San Jose's
ability to use the support. BIB is rated two notches above Costa
Rica's sovereign rating.
Fitch believes BIB's strong ability and propensity to support the
Costa Rican subsidiary remains high, as BAC San Jose is an integral
part of its parent's business model and core to its strategy, and
therefore its ratings mirror those of BIB. Fitch's support
rationale also reflects the negative reputational implications of a
potential default of BAC San Jose for the parent and BAC San Jose's
improving asset quality and profitability, as well as satisfactory
capital buffers and sound and stable funding sources.
BAC Guatemala, Credomatic, BAC Bank, Inc. and Fincapi
For BAC Guatemala, Credomatic and Fincapi, the National ratings
reflect Fitch's assessment of BIB's ability and propensity to
potentially provide support to their subsidiaries. Fitch's
propensity assessment of support is highly influenced by the
subsidiaries' fundamental role within BIB's regional strategy. In
addition, Fitch considers the significant reputational risk for BIB
in the event of an unexpected default of one of its rated
subsidiaries, which also has a high influence on the assessment of
support. BIB is the controlling shareholder of its subsidiaries,
which have high managerial, operational and strategic integration,
and operate under the same brand.
For BAC Bank, Inc., the National ratings reflect with high
importance the potential reputational risk that could affect BIB
and BAC|Credomatic group, given that the entities share the same
brand. BAC Bank, Inc. is in the process of voluntary liquidation
and consolidating operations with its affiliates.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
BAC San Jose
- Negative changes in BAC San Jose's IDRs and SSR would mirror any
negative movement in Costa Rica's Sovereign ratings and Country
Ceiling;
- Any perception by Fitch of a relevant reduction in BIB's
propensity of support may trigger a downgrade of BAC San Jose's
IDRs and SSR.
- A downgrade of BIB's IDRs could lead to downgrade of BAC San
Jose's Local Currency IDR. A downgrade of BIB's IDRs by more than
one notch could lead to a downgrade of BAC San Jose's Foreign and
Local Currency IDRs, as well as its SSR.
BAC Guatemala, Credomatic and Fincapi
- BAC Credomatic Guatemala's ratings could be downgraded if BIB's
IDR is downgraded.
BAC Bank, Inc.
- Sensitivities are not applicable as these ratings have been
withdrawn.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
BAC San Jose
- BAC San Jose's Foreign Currency IDR and SSR could be upgraded if
Costa Rica's Country Ceiling are upgraded; while the Local Currency
IDR would be upgraded if BIB's IDRs and Costa Rica's Sovereign
rating are upgraded;
BAC Guatemala, Credomatic and Fincapi
- The National ratings are at the highest level of the National
rating scale, and therefore have no upside potential.
BAC Bank, Inc.
- Sensitivities are not applicable as these ratings have been
withdrawn.
SUMMARY OF FINANCIAL ADJUSTMENTS
Pre-paid expenses and other deferred assets were re classified as
intangibles and deducted from total equity, to reflect its low
absorption capacity.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
BAC San Jose's ratings are based on Fitch's opinion of BAC
International Bank Inc. (BIB)'s propensity to provide timely
support.
BAC Guatemala, Credomatic, Fincapi and BAC Bank, Inc.'s ratings are
based on the potential support they could receive from its parent,
BIB, if required.
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.
Entity/Debt Rating Prior
----------- ------ -----
Financiera de
Capitales, S.A. Natl LT AAA(gtm) Upgrade AA+(gtm)
Natl ST F1+(gtm) Affirmed F1+(gtm)
Credomatic de
Guatemala, S.A. Natl LT AAA(gtm) Upgrade AA+(gtm)
Natl ST F1+(gtm) Affirmed F1+(gtm)
Banco BAC San
Jose, S.A. LT IDR BB Affirmed BB
ST IDR B Affirmed B
LC LT IDR BB+ Upgrade BB
LC ST IDR B Affirmed B
Shareholder
Support bb Affirmed bb
BAC Bank, Inc. Natl LT WD(gtm) Withdrawn AAA(gtm)
Natl LT AAA(gtm) Upgrade AA+(gtm)
Natl ST WD(gtm) Withdrawn F1+(gtm)
Natl ST F1+(gtm) Affirmed F1+(gtm)
Banco de
America Central,
S.A. (Guatemala) Natl LT AAA(gtm) Upgrade AA+(gtm)
Natl ST F1+(gtm) Affirmed F1+(gtm)
BANCO INTERNATIONAL: Fitch Affirms IDRs at 'BB-', Outlook Stable
----------------------------------------------------------------
Fitch has affirmed Banco Internacional de Costa Rica, S.A.'s
(BICSA) Long- and Short-Term Issuer Default Ratings (IDR) and
Viability Rating (VR) at 'BB-', 'B' and 'bb-', respectively. The
Rating Outlook for the Long-Term IDR is Stable. Fitch has also
affirmed BICSA's Shareholder Support Rating (SSR) at 'bb-'.
KEY RATING DRIVERS
Ratings Driven by VR and SSR: BICSA's IDRs are driven equally by
its VR and SSR, as both are at the same level of 'bb-'. BICSA's VR
reflects its specialized business profile, prudent risk framework
and moderate but stable financial performance. BICSA's SSR at 'bb-'
also reflects Fitch's opinion of the entity's shareholders', BCR
and BNCR, and their moderate ability and propensity to assist
BICSA, should the need arise.
Niche-Oriented Business Profile: BICSA's VR of 'bb-' reflects its
business profile, marked by a modest franchise and a
corporate-oriented business model that yields a lower total
operating income (2019-2022 average of around USD45 million),
compared to peers. Nevertheless, the institution shows a stable
financial performance throughout the business cycles, reflected by
its adequate loan quality metrics alongside an above-average
capitalization and sound liquidity. The bank continues to focus its
business generation with very focused customer segmentation
complemented by factoring and leasing services.
Blended Approach for Operating Environment: BICSA's operating
environment (OE) assessment at 'bb' is adjusted by its
international operations - as the entity has exposures in 25
jurisdictions. Panama and Costa Rica represent around 63% of total
earning assets. Outlook in most jurisdictions influences the
affirmation of Fitch's OE assessment at 'bb' with a stable trend.
The bank's international operations yield an OE lower than the
Panama's OE assessment of 'bb+', where the bank is domiciled.
Prudent Risk Profile: BICSA's risk profile, consisted of solid
credit policies and risk controls that, in Fitch's opinion, have
allowed the bank to maintain a stable performance throughout
various economic cycles. Regarding non-financial risks, Fitch
considers that the initiative by the Costa Rican government to sell
BCR - including its subsidiaries - was not realized. Nevertheless,
the announcement did not alter the bank's franchise, including its
ability to generate business volumes on both sides of the balance
sheet.
Reasonable Asset Quality: Fitch believes BICSA's asset quality
ratios have a good prospect of improving given the bank's growth
prospects favored by the main economies in which it operates. As of
YE 2022, the impaired loan ratio using Stage 3 loans of 4.1% is
considered manageable and in accordance to its assessment
(four-year average of 3.8%). On another hand, the impaired loan
ratio using loans overdue above 90-day ratio was a relatively low
2.3%, lower than its four-year average of 2.5% and past its 2.8%
recent peak registered in 2020. Furthermore, despite a high
proportion on the bank's securities portfolio being held to
maturity, the investments are of high quality and mostly shorter
duration, minimizing unrecognized losses.
Narrow Profitability: Fitch considers that BICSA's operating
profitability is structurally low but, favorably, it has improved
in relation to 2021 and progressively returning to pre-pandemic
levels due to increased business volume and less LICs. As of
December 2022, the operating return of risk-weighted assets is a
low 0.51%, higher than its 2019-2022 average of 0.46%. The agency
believes that the bank's profitability indicators will improve
according to its projections in the current fiscal period.
Sound Liquidity, Concentrated Deposits: Fitch foresees that BICSA's
liquidity metrics will remain adequate while its total customer
deposits will grow according to its forecast, hence, the loans to
deposits ratio will remain structurally high alongside a mildly
improving, but still very concentrated, top 20 depositors over
total deposits ratio. As of 4Q22, loan-to-deposit ratio was around
191%. Fitch believes that BICSA's owners would likely provide
ordinary funding support, if needed
Capitalization Metrics Above Local Peers: Fitch believes that
BICSA's capitalization and leverage indicator remain acceptable to
withstand potential losses in case of stress. As of December 2022,
common equity Tier 1 (CET1) ratio was nearly 13% (YE 2021: 13.8%)
from the 13.8% of YE 2021. This compares well with other
corporate-oriented banks and is benefitted by the bank's prudent
risk policies and full-earnings-retention policy. Its decrease is
due to its renewed growth and is expected to fluctuate around its
current level for the foreseeable future.
Shareholders Support: Fitch's assessment of the likelihood of
support considers with high importance the reputational risk that
BCR and BNCR are exposed in a scenario of BICSA's default. Also,
considers with moderate importance BICSA's role for international
operations of Costa Rica's state-owned banks as well as significant
management independence and track record of support
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- The IDRs and National-Scale ratings could be downgraded based on
a material deterioration of its parent companies' propensity and
ability of support as reflected on an SSR downgrade and accompanied
by a deterioration of VR;
- The SSR is sensitive to negative changes in BCR's and BNCR's
ability or propensity to provide timely support to the bank;
- The VR could be downgraded by a material deterioration of the OEs
in Panama and Costa Rica where BICSA has its main exposures and/or
a relevant deterioration of the bank's financial profile reflected
in a significant and sustained increase in its impaired loans and
by a further reduction of its operating profit to risk weighted
average (RWA) that reduces its CET1 ratio below 12%.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- The IDRs and National-Scale ratings could be upgraded based on a
material improvement of its parent companies' propensity and
ability of support as reflected on an SSR upgrade or an improvement
of the VR, in the latter case, the IDRs would return to be driven
by the bank's intrinsic performance;
- Although not likely in the foreseeable future, the SSR is
sensitive to significant positive changes in BCR's and BNCR's
ability or propensity to provide timely support to the bank;
- The VR could be upgraded by a significant and sustained
improvement in its financial performance, resulting in a higher
operating return on RWAs above 1.25% and an improved funding
structure reflected in a loan-to-deposit ratio of 140%, while
maintaining capitalization ratios assets and strong asset quality;
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
The Long-Term and Short-Term National Rating of BICSA's senior
unsecured issuances in Panama are rated at 'A-' and 'F2'
(respectively) at the same level of the issuer and reflects the
bank's intrinsic creditworthiness.
The National Rating of BICSA's senior unsecured debt issuances in
El Salvador, rated 'AAA(slv)' with a Stable Outlook, reflects the
relative strength of the Panamanian bank compared with other
issuers in El Salvador. BICSA's IDR is five notches above El
Salvador's 'CCC' Sovereign Rating.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
- Panamanian debt ratings would reflect any possible movement in
the bank's national ratings.;
- Salvadoran debt ratings could be downgraded in response to a
multi-notch reduction in BICSA's IDR;
- The Salvadoran debt ratings are at currently the highest possible
level of the rating scale.
VR ADJUSTMENTS
The OE Score has been assigned below the implied score due to the
following adjustment reason: International Operations (negative).
The Funding and Liquidity Score has been assigned above the implied
score due to the following adjustment reason: Liquidity Access and
Ordinary Support (positive).
SUMMARY OF FINANCIAL ADJUSTMENTS
Pre-paid expenses and other deferred assets were reclassified as
intangible in order to calculate a consistent tangible common
equity/tangible assets ratio in relation to previous periods
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
BICSA's SSR is linked to the ratings of its parent companies, BCR
and BNCR.
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.
Entity/Debt Rating Prior
----------- ------ -----
Banco
Internacional
de Costa Rica,
S.A. LT IDR BB- Affirmed BB-
ST IDR B Affirmed B
Natl LT A-(pan) Affirmed A-(pan)
Natl ST F2(pan) Affirmed F2(pan)
Viability bb- Affirmed bb-
Shareholder Support bb- Affirmed bb-
senior
unsecured Natl LT AAA(slv)Affirmed AAA(slv)
senior
unsecured Natl LT A-(pan) Affirmed A-(pan)
senior
unsecured Natl ST F2(pan) Affirmed F2(pan)
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: DGA Affirms it's Time to Invest in Country
--------------------------------------------------------------
Dominican Today reports that Eduardo Sanz Lovaton, the Director
General of Customs, emphasized the Dominican Republic's potential
for investment during a panel discussion titled "Diversifying
Industries, Creating Opportunities for Development, and Promoting a
Climate for Investment," part of the Latin American Cities
Conference series.
He praised President Luis Abinader's government for establishing an
environment of trust and understanding in the world of investment
and job creation, adding that the country has a modern and secure
legal framework that makes it an ideal location for private
investment in various economic sectors, according to Dominican
Today. Sanz Lovaton also highlighted logistics as the future of
the country's economy and praised the government's partnership with
the private sector to encourage innovation.
The conference was attended by several officials, including Vice
President Raquel Pena, Minister of Industry, Commerce, and SMEs
Víctor Bisono, Reserve Bank Administrator Samuel Pereyra Rojas,
and National Cuesta Center (CCN) Executive President José Miguel
Gonzalez Cuadra, among others, 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.
TCRLA reported in April 2019 that the Dominican To 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.
DOMINICAN REPUBLIC: Reduces Growth Forecast for 2023 to 4.25%
-------------------------------------------------------------
Dominican Today reports that the gross domestic product (GDP) of
the Dominican Republic will grow by 4.25% at the end of this year,
that is, 0.25% less than estimated last November, the Ministry of
Economy, Planning and Development informed.
In a press release, the ministry said that growth projections had
been revised downwards for 2023 due to a less favorable
international environment, given the tightening of financial
conditions at the global level, according to Dominican Today.
However, it highlighted an expansion in real terms of the GDP of
4.25%, the report notes.
An improvement in the performance of the Dominican economy is
expected for next year, with a natural GDP expansion of 5.0 %, the
report relays.
The economic outlook "continues to be conditioned by the level of
uncertainty that currently dominates global markets, as a result of
the hardening of financial conditions and the economic slowdown of
our main trading partners," states the report Macroeconomic Outlook
2023-2027, according to a note from the Ministry of Economy, the
report says.
According to the information, adopting a restrictive monetary
policy, the subsidies granted by the Dominican Government to
mitigate the increase in fuel prices, and the extension of the
temporary suspension of the adjustments to the electricity tariff
have contributed to the slowdown in inflation, the report notes.
Inflation is expected to converge to the target range of 4% +/- 1%
during 2023, with an expected year-end price growth of 4.5% and an
average of 5.5%, the report discloses.
The authorities also project an average exchange rate of 56.79
pesos per dollar, a reduction of 0.41 cents concerning last
November's forecast, and a depreciation rate of 3.0% concerning the
2022 average, 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 To 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.
=============
E C U A D O R
=============
ECUADOR: Seeks $1 Bil. IMF Credit Line After Series of Disasters
----------------------------------------------------------------
globalinsolvency.com, citing Bloomberg News, reports that Ecuador
is in talks with the International Monetary Fund for a credit line
of as much as $1 billion after the nation was hit by an earthquake,
flooding and a landslide in recent weeks.
The government has its financing needs covered for the year, but is
seeking additional support to fund disaster relief after the series
of natural calamities, Finance Minister Pablo Arosemena said, in an
interview in Washington D.C, according to the report.
"We don't need the money right this second," Arosemena said, notes
the report. "We don't have money or resources to spare, but we're
up to date with our obligations."
The Andean nation is located in a region of intense seismic
activity, and is also vulnerable to volcanic eruptions and extreme
weather, the report notes.
Parts of the country have been affected by La Nina and El Nino
weather events this year, Arosemena said, the report relays.
Ecuador's bonds due in 2030 rose less than a cent to 48 cents on
the dollar on April 13, according to indicative pricing data
collected by Bloomberg, the report discloses.
The IMF is in discussions with the government but officials haven't
made a formal request, Nigel Chalk, the lender's acting director
for the Western Hemisphere, said, the report relays.
In December, Ecuador received a final disbursement of about $700
million of its $6.5 billion extended fund facility with the IMF,
the report adds.
===============
X X X X X X X X
===============
[*] BOND PRICING: For the Week April 10 to April 14, 2023
---------------------------------------------------------
Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
Esval SA 3.5 49.9 2/15/2026 CL CLP
Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD
Provincia de Cordoba 7.1 72.7 8/1/2027 AR USD
Provincia del Chaco Ar 4.0 0.0 12/4/2026 AR USD
Cia Latinoamericana de 9.5 74.3 7/20/2023 AR USD
Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD
Cia Latinoamericana de 9.5 73.9 7/20/2023 AR USD
Sylph Ltd 2.4 65.1 9/25/2036 KY USD
City of Cordoba Argent 7.9 73.1 9/29/2024 AR USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Argentine Republic Gov 7.1 75.7 6/28/2117 AR USD
Noble Holding Internat 6.1 62.0 3/1/2041 KY USD
AES Tiete Energia SA 6.8 1.2 4/15/2024 BR BRL
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Fospar S/A 6.5 1.2 5/15/2026 BR BRL
Argentina Bonar Bonds 7.6 74.4 4/18/2037 AR USD
Noble Holding Internat 5.3 60.5 3/15/2042 KY USD
Argentine Republic Gov 0.5 27.6 12/31/2038 AR JPY
Provincia de Rio Negro 7.8 70.4 12/7/2025 AR USD
Argentina Bonar Bonds 5.8 75.2 4/18/2025 AR USD
Argentine Republic Gov 6.9 75.2 1/11/2048 AR USD
Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD
Province of Santa Fe 6.9 74.7 11/1/2027 AR USD
Provincia de Cordoba 7.1 74.7 8/1/2027 AR USD
Noble Holding Internat 6.2 62.2 8/1/2040 KY USD
Provincia del Chaco Ar 9.4 74.8 8/18/2024 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 Buenos Ai 7.9 75.3 6/15/2027 AR USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Argentine Republic Gov 6.3 74.1 11/9/2047 AR EUR
Province of Santa Fe 6.9 75.2 11/1/2027 AR USD
Metrogas SA/Chile 6.0 41.6 8/1/2024 CL CLP
Argentine Republic Gov 4.3 70.0 12/31/2033 AR JPY
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY 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 2023. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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of the same firm for the term of the initial subscription or
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contact Peter A. Chapman at 215-945-7000.
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