TCREUR_Public/100628.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Monday, June 28, 2010, Vol. 11, No. 125

                            Headlines



B E L G I U M

CARMEUSE HOLDING: S&P Changes Outlook to Stable; Keeps 'B+' Rating


F R A N C E

BELVEDERE SA: Rouvroy & Trylinski Shares Seized by Macro Leaf
RENAULT SA: Cuts Bond Sale Due to Difficult Market Conditions
THEOLIA SA: To Raise Less in Share Sale Than Targeted


G E R M A N Y

ARCANDOR AG: Berggruen May Get Rent Reductions for Karstadt
DEUTSCHE LUFTHANSA: Pilots Union Accepts Mediation Proposal
HEIDELBERGCEMENT AG: Fitch Upgrades Long-Term IDR to 'BB'


I C E L A N D

* ICELAND: Second Crisis Likely as Banks Face Losses


I R E L A N D

CICOL: Directors Insist Firm Is Okay Despite EUR12MM Deficit
STRAWINSKY I: S&P Affirms CCC- Ratings on Two Classes of Notes


K A Z A K H S T A N

ASTANA FINANCE: To Continue Restructuring Talks With Creditors


N E T H E R L A N D S

PANTHER CDO: S&P Cuts Ratings on Two Classes of Notes to 'B+'
PANTHER CDO: S&P Cuts Ratings on Three Classes of Notes to 'BB-'
PANTHER CDO: S&P Cuts Rating on Class E Notes to 'B-'


R O M A N I A

* ROMANIA: Banks Ready for Debt-for-Equity Swap


R U S S I A

EVROFINANCE MOSNARBANK: Fitch Upgrades Long-Term IDR to 'B+'
RUSSIAN UNIVERSAL: Fitch Upgrades Long-Term IDR to 'B'
SDM-BANK JSC: Fitch Upgrades Long-Term IDR to 'B'
TRANSCREDITBANK JSC: Moody's Gives Stable Outlook on 'D-' Rating
URALSVYAZINFORM OJSC: S&P Puts 'B+' Rating on Watch Developing

ZENIT BANK: Moody's Changes Outlook on 'Ba3' Rating to Stable

* Fitch Assigns 'BB-' Rating on Republic of Karelia's Bonds


S E R B I A   &   M O N T E N E G R O

* CITY OF KRALJEVO: Moody's Assigns 'B1' Issuer Rating
* CITY OF NOVI SAD: Moody's Assigns 'Ba3' Issuer Rating
* CITY OF VALJEVO: Moody's Assigns 'B1' Issuer Rating


S P A I N

AYT KUTXA: Fitch Corrects Press Release on Ratings


U N I T E D   K I N G D O M

APG VISUAL: Assets Sold to Character Mailing Services
BRITISH AIRWAYS: To Hire More Than 1,000 Lower-Paid Cabin Crew
EASSDA LTD: Owes Unsecured Creditors GBP1.35 Million
EURO CONSTRUCTION: Owes Unsecured Creditors GBP2.61 Million
FABRIC 591: Bought Out of Administration; 100 Jobs Secured

* UK: Says Bankruptcy Administrators Need Independent Overseer
* UK: Banks "Vulnerable" to Asset Writedowns, BoE Report Says


X X X X X X X X

* BOND PRICING: For the Week June 21 to June 25, 2010




                         *********



=============
B E L G I U M
=============


CARMEUSE HOLDING: S&P Changes Outlook to Stable; Keeps 'B+' Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services said it revised its outlook on
Belgium-based lime and limestone producer Carmeuse Holding S.A. to
stable from negative.  At the same time, the 'B+' corporate credit
rating on Carmeuse was affirmed.

"The outlook revision reflects S&P's view that the operating
pressures that affected Carmeuse in late 2008 and early 2009 have
now subsided," said Standard & Poor's credit analyst Per Karlsson.
"It also reflects the company's higher operating profits in the
first quarter of 2010 and S&P's expectation of a continued gradual
improvement in 2010."

Volumes are still below the levels Carmeuse achieved before the
recent downturn, however.  The outlook change further reflects
S&P's view that Carmeuse should have sufficient headroom under its
financial covenants and that operating profits in 2010 will remain
at least in line with the levels seen over the past two quarters.

S&P continues to view Carmeuse's business risk profile as "fair".
The group has considerable exposure to the mature steel industry
(about 30% of sales), which is subject to cycles that can put
pressure on its operating performance and profitability, as
demonstrated in 2008 and the first half of 2009.  S&P understands,
however, that steel production increased sharply in the first five
months of 2010, up about 46% in Europe and 61% in North America
according to the World Steel Association.  Since midyear 2009,
Carmeuse's performance has gradually improved, and in the first
quarter of 2010 reported EBITDA stood at EUR48.7 million, compared
with EUR37.2 million (excluding the sale of CO2) in first-quarter
2009.  Although part of the steel-production increase will likely
be temporary, S&P believes the operating environment has rebounded
from the depressed levels of last year.

Under S&P's criteria, S&P continues to characterize the company's
financial risk profile as "aggressive".  This takes into account
the group's relatively high debt and cyclical cash flow generation
and modest free operating cash flows.  In the first quarter of
2010, Carmeuse generated funds from operations of about
EUR33 million.  Thanks also to strong working capital inflows, the
company was able to cover capital spending of EUR20 million and
still achieve free operating cash flow of about EUR22 million.
S&P understand, however, that working capital is partly seasonal
and expect some outflow in the second half of 2010.

"Although S&P expects Carmeuse's operational performance to
continue improving in the first half of 2010, S&P is guarded about
the company's prospects for the second half of the year in light
of the uncertain economic climate," Mr. Karlsson added.

S&P expects Carmeuse to report adjusted funds from operations to
adjusted debt of about 15% and adjusted debt to adjusted EBITDA of
about 4.5x.

"The outlook is stable because S&P believes that Carmeuse's
operating performance should continue to gradually improve," said
Mr. Karlsson.


===========
F R A N C E
===========


BELVEDERE SA: Rouvroy & Trylinski Shares Seized by Macro Leaf
-------------------------------------------------------------
Matthew Campbell at Bloomberg News reports that Belvedere SA
shares held by Chief Executive Officer Jacques Rouvroy and his
deputy Christophe Trylinski were seized Wednesday by bailiffs in
France as part of a dispute with London investment funds.

Bloomberg relates Fabrice Marchisio, a lawyer for the funds, said
in a statement that shares representing about 15.5% of the share
capital of Belvedere were seized by Maple Leaf Macro Volatility
Master Fund and Astin Capital Management Ltd.

Bloomberg recalls a U.K. court in 2009 ordered the company to pay
at least EUR7.5 million (US$9.24 million) to Maple Leaf for its
role in financing the executives' efforts to regain control of
Belvedere.  According to Bloomberg, Alain Ribeyre, a lawyer for
Messrs. Rouvroy and Trylinski, said the executives on Wednesday
applied to a court in Dijon for a cancellation of the seizure.

Mr. Marchisio, as cited by Bloomberg, said the seizures included
about 7.5% of the direct share capital of Belvedere, as well as
two-thirds of the shares in holding company Financiere du
Vignoble, which holds 8% of Belvedere.

As reported by the Troubled Company Reporter-Europe, Belvedere was
granted protection from creditors in July 2008 after violating the
terms of its notes by repurchasing more of its stock than allowed.

Belvedere SA -- http://www.belvedere.fr/-- is a France-based
company engaged in the production and distribution of beverages.
The Company's range of products includes vodka and spirits, wines,
and other beverages, under such brands as Sobieski, William Peel,
Marie Brizard, Danzka and others.  Belvedere SA operates through
its subsidiaries, including Belvedere Czeska, Belvedere
Scandinavia, Belvedere Baltic, Belvedere Capital Management,
Sobieski SARL and Sobieski USA, among others.  It is present in a
number of countries, such as Poland, Lithuania, Bulgaria, Denmark,
France, Spain, Russia, Ukraine, the United States and others.  In
addition, the Company holds a minority stake in Abbaye de
Talloires, involved in the hotel and wellness center.


RENAULT SA: Cuts Bond Sale Due to Difficult Market Conditions
-------------------------------------------------------------
Caroline Hyde at Bloomberg News reports that Renault SA reduced a
sale of bonds by 20%, citing "more difficult" market conditions.

According to Bloomberg, Renault sold EUR400 million (US$492
million) of five-year bonds, EUR100 million less than it
originally sought, with a yield premium at the higher end of the
range advertised.

"The market is a bit more difficult at the moment," Bloomberg
quoted Gita Roux, a spokeswoman for the Boulogne-Billancourt-based
company, as saying.  "Renault had the arbitrage between volume and
price and, as the company is not in great need of financing right
now, it would rather focus on price than volume."

The cost of insuring Renault's bonds against default jumped 20
basis points to 328, the highest level in two weeks, Bloomberg
says, citing CMA DataVision.

                         About Renault SA

Renault SA -- http://www.renault.com/-- is a France-based company
primarily engaged in the manufacture of automobiles and related
services.  The Company has two main areas of business activity:
the Automobile division, which handles the design, manufacture and
marketing of passenger cars and commercial vehicles, under
Renault, Renault Samsung Motors and Dacia brands, and the Sales
Financing division, which provides financial and commercial
services related to the Company's sales activities, and is
comprised of RCI Banque and its subsidiaries.  The Company
operates worldwide via a group of subsidiaries and dependant
companies, including wholly owned Renault SAS, 99.43%-owned Dacia,
44.3%-owned Nissan Motor and 20.7%-owned AB Volvo, among others.

                           *     *     *

Renault SA continues to carry long- and short-term corporate
credit and debt ratings of 'BB/B' from Standards & Poor's Ratings
Services with stable outlook.  The ratings were lowered to their
current level from 'BBB-/ A-3' in June 2009.

Renault continues to carry a Ba1 long-term corporate family rating
and senior unsecured debt rating from Moody's Investors Services
with stable outlook.  The company's subordinated debt carries a
Ba2 rating from Moody's.


THEOLIA SA: To Raise Less in Share Sale Than Targeted
-----------------------------------------------------
Tara Patel at Bloomberg News reports that Theolia SA said Thursday
it will seek to raise EUR60 million (US$74.3 million) in a rights
offering through July 7, short of an original EUR100-million
target.

"The amount is disappointing," Bloomberg quoted Jerome Chosson,
analyst at IDMidcaps, as saying. "This will buy them some time but
won't go very far."

Hurt by a lack of financing during the global credit slump,
Theolia has sought to sell assets, cut costs and halt some
operations, Bloomberg notes.  Bloomberg recalls previous
management announced the plan to restructure EUR253 million of
convertible bonds and raise as much as EUR100 million in a share
sale to help avoid creditor protection.

Bloomberg relates Theolia said in a statement that the rights
offering includes commitments of EUR30.2 million from Boussard &
Gavaudan Asset Management LP and EUR15.1 million from Stiching
Pensioenfonds ABP, Aix-en-Provence.

"Theolia will have improved its balance sheet by reinforcing its
equity and will have reduced its debt by reimbursing in advance a
portion of its bond debt," Bloomberg quoted Chief Executive
Officer Fady Khallouf as saying in a statement.

Theolia SA (EPA:TEO) -- http://www.theolia.com/-- is a
France-based energy company that develops and manages renewable
energy sources.  It specializes in the production of electricity
using wind power, as well as in the construction of wind power
plants and turbines, based notably in France and Germany.
Additionally, the Company is engaged in non-wind turbine
activities, such as the utilization of biomass, cogeneration and
biogas techniques for the production of electricity, through its
subsidiary, THENERGO.  Theolia SA operates several subsidiaries,
including Ventura, Natenco SAS, Meastrale Green Energy and Theolia
Iberica.  The Company is operational in such countries as Germany,
Spain, Brazil, Greece, Italy, India and Morocco.


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G E R M A N Y
=============


ARCANDOR AG: Berggruen May Get Rent Reductions for Karstadt
-----------------------------------------------------------
Holger Elfes at Bloomberg News, citing Handelsblatt, reports that
Nicolas Berggruen, the billionaire who agreed to buy Arcandor AG's
insolvent German retailer Karstadt, may be successful in his
attempt to get rent reductions for the chain's stores.

According to Bloomberg, the newspaper, citing people familiar with
the talks, said creditors for the Highstreet partnership, which
owns most the stores sites, are willing to cut rents.

Separately, Bloomberg News' Mr. Elfes, citing Frankfurter
Rundscha, reports that Maurizio Borletti, a co-owner of
Karstadt's real estate, has sent a letter to the German government
in which he criticizes Mr. Berggruen.  Bloomberg notes the
newspaper said Mr. Borletti has "doubts" regarding Mr. Berggruen's
business plan as the investor has no retail experience.

As reported by the Troubled Company Reporter-Europe on June 22,
2010, Dow Jones Newswires said Mr. Berggruen's takeover plan for
Karstadt includes a 10% share of Karstadt's return on equity in
the form of warrants for its Highstreet real estate property
owners in exchange for agreeing to lower rents.  Dow Jones
disclosed Mr. Berggruen additionally wants to amend Karstadt's
master lease agreement, which would give him the freedom to
separate some segments, such as sporting goods, into individual
units.

                        About Arcandor AG

Germany-based Arcandor AG (FRA:ARO) -- http://www.arcandor.com/--
formerly KarstadtQuelle AG, is a tourism and retail group.  Its
three core business areas are tourism, mail order services and
department store retail.  The Company's business areas are covered
by its three operating segments: Thomas Cook, Primondo and
Karstadt.  Thomas Cook Group plc is a tour operator with
operations in Europe and North America, set up as a result of a
merger between MyTravel and Thomas Cook AG.  It also operates the
e-commerce platform, Thomas Cook, supporting travel services.
Primondo has a portfolio of European universal and specialty mail
order companies, including the core brand Quelle.  Karstadt
operates a range of department stores, such as cosmopolitan
stores, including KaDeWe (Kaufhaus des Westens), Karstadt
Oberpollinger and Alsterhaus; Karstadt brand department stores;
Karstadt sports department stores, offering sports goods in a
variety of retail outlets, and a portal, karstadt.de that offers
online shopping, among others.

As reported by the Troubled Company Reporter-Europe, a local court
in Essen formally opened insolvency proceedings for Arcandor on
September 1, 2009.  The proceedings started for the Arcandor
holding company and for 14 units, including the Karstadt
department-store chain and Primondo mail-order division.

Arcandor filed for bankruptcy protection after the German
government turned down its request for loan guarantees.  On
June 8, 2009, the government rejected two applications for help by
the company, which employs 43,000 people.  The retailer sought
loan guarantees of EUR650 million (US$904 million) from Germany's
Economy Fund program.  It also sought a further EUR437 million
from a state-owned bank.


DEUTSCHE LUFTHANSA: Pilots Union Accepts Mediation Proposal
-----------------------------------------------------------
Nicholas Comfort at Bloomberg News reports that Deutsche Lufthansa
AG will avoid a new round of pilot walkouts after the Vereinigung
Cockpit union accepted a mediation proposal.

According to Bloomberg, the German union said the proposal by
mediator Klaus von Dohnanyi accommodates both the desire of the
pilots to keep jobs from being moved abroad as well employee
contributions to the company's economic future.  Bloomberg relates
Andreas Bartels, a Lufthansa spokesman, said Thursday that the
airline has also agreed to the proposal, which will ensure strikes
won't be held.

Bloomberg notes the union said Thursday in an e-mailed statement
that the proposal foresees a freeze on pay increases through March
of next year and all of the pilots' contributions are linked to
guarantees on existing jobs and growth.

On May 6, 2010, the Troubled Company Reporter-Europe, citing the
Financial Times, reported that Lufthansa posted a net loss of
EUR298 million in the first quarter of 2010, compared with a net
loss of EUR267 million in 2009.  The FT disclosed the German
airline blamed losses that were wider than expected partly on
higher fuel charges and costs from the consolidation of Austrian
Airlines and bmi, which Lufthansa does not expect to be profitable
in 2010.  Lufthansa has estimated costs from the volcanic
disruption at about EUR200 million, according to the FT.  The FT
said a strike by Lufthansa pilots in February was another factor
and was estimated by the airline to have cost about EUR48 million.

Deutsche Lufthansa AG -- http://www.lufthansa.com/-- is an
aviation company with operations worldwide.  It operates in five
business segments: Passenger Transportation, Logistics,
Maintenance, Repair and Overhaul (MRO), Information Technology
(IT) services and Catering.  On January 22, 2008, it acquired 19%
of the shares in JetBlue Airways.  In October 2008, Lufthansa
established an Italian company called Lufthansa Italia as it mulls
to make Milan based Malpensa airport its third hub after Frankfurt
and Munich.  In September 2009, Austrian Airlines AG was taken
over by Deutsche Lufthansa AG.  Austrian Airlines will therefore
become part of the Lufthansa Group as of September 2009.

                           *     *     *

Deutsche Lufthansa AG continues to carry a Ba1 Corporate Family
Rating and Probability of Default Rating from Moody's Investors
Service with stable outlook.  The ratings were assigned by Moody's
in September 2009.


HEIDELBERGCEMENT AG: Fitch Upgrades Long-Term IDR to 'BB'
---------------------------------------------------------
Fitch Ratings has upgraded Germany-based HeidelbergCement AG's
Long-term Issuer Default and senior unsecured ratings to 'BB' from
'BB-'.  The Outlook on the Long-term IDR is Stable.  HC's Short-
term IDR has been affirmed at 'B'.

Fitch has also assigned a senior unsecured rating of 'BB' to HC's
EUR650 million 6.75% notes due in December 2015, issued under its
EMTN program.

The upgrade reflects Fitch's view that tough market conditions in
mature markets, especially in western Europe, are being somewhat
mitigated by still sound trading conditions in emerging markets.
This, coupled with continued cost containment efforts, should
allow HC to progressively increase operational cash flow,
ultimately resulting in modest free cash flow generation and a
gradual improvement of credit metrics.  The upgrade is also
supported by the recent refinancing efforts undertaken by HC,
including bonds issued in January (EUR1.4 billion) and June 2010
(EUR650 million) and a new EUR3 billion syndicated facility
maturing in 2013, which have notably lengthened its average debt
maturity profile and strengthened liquidity.

The Stable Outlook reflects the agency's view that expected credit
metrics over the next 24 months should provide sufficient headroom
for any moderate under-performance.

Fitch's latest forecasts for HC include a low single-digit
percentage point decline in revenue in 2010 and a slight recovery
in 2011.  EBITDA margins are expected to show some improvement
from 2010, due to cost containment efforts.  Under this scenario,
the agency expects HC to generate free cash flow, albeit at lower
levels than the 2005-2009 average of about EUR350 million.  Funds
from operations (FFO) adjusted net leverage is forecast to be
below 4.2x by FYE11.  In its forecasts, the agency has not
factored in any inflows from potential disposals.

Fitch considers HC's liquidity to be moderate.  At end-Q110, the
group had available cash of EUR763 million (excluding
EUR57 million of restricted cash), which together with available
committed facilities of EUR1.8 billion, gave total liquidity of
EUR2.6 billion against current financial liabilities of
EUR1.2 billion.  At 31 March 2010, LTM (last 12 months) FFO
adjusted net leverage stood at 5.8x, based on Fitch's calculations
(5.8x at FYE09).

HC is a heavy building materials player, with global leading
positions in aggregates and is among the top four global players
in cement and ready-mixed concrete.  It is geographically
diversified, with presence in about 40 countries.  In FY09, the
group reported revenue and EBITDA (based on Fitch's calculations)
of EUR11.1 billion and EUR1.9 billion, respectively.


=============
I C E L A N D
=============


* ICELAND: Second Crisis Likely as Banks Face Losses
----------------------------------------------------
Omar R. Valdimarsson at Bloomberg News reports that Icelandic
banks may face a second crisis as a court ruling banning some
foreign currency loans saddles lenders, mostly owned by
international creditors, with losses on US$28 billion of debt.

Bloomberg relates the Supreme Court ruled June 16 that loans
indexed to foreign-currency rates were illegal in three cases
involving private car loans and a corporate property loan.  The
decisions may mean that borrowers with such loans are only obliged
to repay the principal in kronur, making the lenders liable for
currency losses after a third of the krona's value against the
Japanese yen and Swiss franc was erased since September 2008.

"If the decision means all loans in kronur linked to the value of
foreign currencies are illegal, I can't imagine the Icelandic
banking sector will survive that," Bloomberg quoted Oddgeir A.
Ottesen, an economist at IFS Consulting in Reykjavik, as saying in
a telephone interview.

Bloomberg recalls Iceland's 2008 financial crisis was exacerbated
by banks borrowing in yen and francs to take advantage of lower
interest rates, and then repackaging the loans in krona before
passing them on to clients.


=============
I R E L A N D
=============


CICOL: Directors Insist Firm Is Okay Despite EUR12MM Deficit
------------------------------------------------------------
Laura Noonan at Irish Independent reports that property developer
Bernard McNamara and his joint-venture partners have insisted
their Cicol company should be considered a "going concern" --
despite racking up a EUR12 million shareholders' deficit.

According to the report, filings show Cicol was sitting on a
shareholders' deficit of EUR11.9 million on September 30, 2009, up
some EUR1.4 million year-on-year.

The report relates in accounts signed off on June 11, Mr. McNamara
and his fellow directors acknowledged their company was "dependent
on the continuing financial support" of its bank, but said they
had "not been made aware" of any potential funding problems.  The
directors also said they believed the EUR16.7 million carrying
value of their property asset still stood, the report discloses.

The uncertainty over property valuations prompted Cicol's auditors
to place an "emphasis of matter" on the accounts, though they
remain unqualified, the report notes.

Cicol is a property developer based in Ireland.


STRAWINSKY I: S&P Affirms CCC- Ratings on Two Classes of Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
Strawinsky I PLC's class A1-T, A1-R, and C notes.  At the same
time, S&P affirmed the ratings on all other classes of notes.

The rating actions are the result of the increasing credit
enhancement in the transaction.  This increase is due to higher
recovery on assets than S&P anticipated based on its recovery rate
assumptions for cash flow collateralized debt obligations.  In
addition, S&P has observed an increase in the weighted-average
spread, deleveraging of the class A1-R and A1-T notes, and a
reduction in the weighted-average life of the transaction.  As a
result of these factors, S&P has raised the ratings on the class
A1-T, A-1R, and C notes.

The affirmation of the class A2, B, D, and E notes reflects S&P's
view that these tranches have adequate credit support to maintain
their current ratings.

On Dec. 3, 2009, S&P lowered and removed from CreditWatch negative
its ratings on seven tranches.

Strawinsky is an arbitrage cash flow corporate loan collateralized
loan obligation, which closed in August 2007.  IMC Asset
Management is the manager of the transaction.

                           Ratings List

                         Strawinsky I PLC
                EUR300 Million Floating-Rate Notes

                          Ratings Raised

                                      Rating
                                      ------
               Class           To              From
               -----           --              ----
               A1-T            AA+             AA-
               A1-R            AA+             AA-
               C               B+              CCC+

                         Ratings Affirmed

                      Class           Rating
                      -----           ------
                      A2              BBB+
                      B               BB+
                      D               CCC-
                      E               CCC-


===================
K A Z A K H S T A N
===================


ASTANA FINANCE: To Continue Restructuring Talks With Creditors
--------------------------------------------------------------
JSC Astana Finance disclosed that, following the appointment of
its new management board, as announced on May 7, 2010, the new
management team has taken time to assess the recent developments
in the financial position and prospects of the Company.

In light of the recent developments, the Company has made a
proposal to the Creditors' Committee revising the terms for the
restructuring that had previously been agreed with the Creditors'
Committee and that were set out in the term sheet dated
November 12, 2009.  The revised proposal has been rejected by the
Creditors' Committee.

The Company intends to continue its discussions with the
Creditors' Committee and other creditors with the intention of
completing the process of restructuring its debt obligations as
soon as possible.

Astana Finance B.V.(Netherlands) is a wholly owned subsidiary of
Kazakhstan's JSC Astana Finance.


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N E T H E R L A N D S
=====================


PANTHER CDO: S&P Cuts Ratings on Two Classes of Notes to 'B+'
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on Panther CDO III B.V.'s
class A, B, C1, C2, D1, D2, and Q comb notes.

These rating actions follow S&P's assessment of the transaction
performance using data from the April 30, 2010 trustee report, in
addition to its cash flow analysis.

S&P has applied its updated criteria for corporate CDOs for the
portion of the pool that comprises corporate loans, assessed the
credit deterioration in the transaction portfolio, and conducted a
cash flow analysis of all the assets in the portfolio.

S&P observes that the deterioration in the credit quality of the
portfolio has caused an increase in the scenario default rates for
this transaction.  In addition, the notional balance of the class
A notes has reduced from its initial amount following a breach of
the class D overcollateralization test.

S&P also subjected the capital structure to a cash flow analysis
to determine the break-even default rate for each rated class of
notes.  In this analysis, S&P used the reported portfolio balance,
weighted-average spread, and weighted-average recovery rates.  S&P
incorporated various cash flow stress scenarios using alternative
default patterns, levels, and timing for each liability rating
category (i.e., 'AAA', 'AA', and 'BBB'), in conjunction with
different interest stress scenarios.  From this analysis, S&P
obtained BDRs for each rated class of notes that exceeds the SDRs
obtained when running the existing portfolio through its CDO
evaluator.

In S&P's opinion, the existing credit enhancement in this
transaction is not sufficient to support the current ratings on
all classes of the notes.  As a result, S&P has lowered the
ratings on all the notes to levels S&P believes are commensurate
with their available credit enhancement.

None of the ratings was affected by either the largest obligor
default test or the largest industry default test--two
supplemental stress tests S&P introduced as part of S&P's criteria
update.

Panther CDO III is a cash flow collateralized debt obligation of
mixed assets of loans to primarily speculative-grade corporate
firms, and predominately European structured finance assets,
involving largely residential mortgage-backed securities, consumer
asset-backed securities, leverage loan-based CDOs, and commercial
mortgage-backed securities assets.  It closed in September 2005
and is managed by M&G Investment Management Ltd.

                           Ratings List

                       Panther CDO III B.V.
       EUR401.65 Million Floating-Rate And Fixed-Rate Notes

      Ratings Lowered and Removed From CreditWatch Negative

                                 Rating
                                 ------
          Class           To              From
          -----           --              ----
          A               A               AAA/Watch Neg
          B               BBB+            AA-/Watch Neg
          C1              BB+             A-/Watch Neg
          C2              BB+             A-/Watch Neg
          D1              B+              BBB-/Watch Neg
          D2              B+              BBB-/Watch Neg
          Q comb          BBB             A-/Watch Neg


PANTHER CDO: S&P Cuts Ratings on Three Classes of Notes to 'BB-'
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on Panther CDO IV B.V.'s
class B, C, D, E1, E2, and P (combo) notes.

These rating actions follow S&P's assessment of the transaction
performance using data from the May 31, 2010 trustee report, in
addition to its cash flow analysis.

S&P has applied its updated criteria for corporate CDOs for the
portion of the pool that comprises corporate loans, assessed the
credit deterioration in the transaction portfolio, and conducted a
cash flow analysis incorporating all the assets in the portfolio.

S&P observes that the deterioration in the credit quality of the
portfolio has caused an increase in the scenario default rates for
this transaction.  In addition, the notional balance of the class
A notes has reduced from its initial amount after payments that
would otherwise be used to pay interest on the class B, C, D, E1,
and E2 notes were diverted to pay principal on the class A notes
following a breach of all the overcollateralization tests.  S&P
has affirmed its 'AAA' ratings on the class A1 and A2 notes as its
cash flow analysis demonstrates that in its opinion, the amount of
credit enhancement available to the class A notes is commensurate
with a 'AAA' rating.

S&P also subjected the capital structure to a cash flow analysis
to determine the break-even default rate for each rated class of
notes.  In this analysis, S&P used the reported portfolio balance,
weighted-average spread, and weighted-average recovery rates.  S&P
incorporated various cash flow stress scenarios using alternative
default patterns, levels, and timing for each liability rating
category (i.e., 'AAA', 'AA', and 'BBB'), in conjunction with
different interest stress scenarios.  From this analysis, S&P
obtained BDRs for each rated class of notes that exceeds the SDRs
obtained when running the existing portfolio through S&P's CDO
evaluator.

In S&P's opinion, the existing credit enhancement in this
transaction is not sufficient to support the current ratings on
any class except the A1 and A2 notes.  As a result, S&P has
lowered the ratings on the class B, C, D, E1, and E2 notes to
levels S&P believes are commensurate with their available credit
enhancement.

None of the ratings was affected by either the largest obligor
default test or the largest industry default test--two
supplemental stress tests S&P introduced as part of S&P's criteria
update.

Panther CDO IV is a cash flow collateralized debt obligation of
mixed assets of loans to primarily speculative-grade corporate
firms, and predominately European structured finance assets,
involving largely commercial mortgage-backed securities,
residential mortgage-backed securities, consumer asset-backed
securities, and leverage loan-based CDO assets.  It closed in
December 2006.

                           Ratings List

                        Panther CDO IV B.V.
         EUR410 Million Floating-Rate And Fixed-Rate Notes

      Ratings Lowered and Removed From CreditWatch Negative

                                Rating
                                ------
           Class           To            From
           -----           --            ----
           B               A+            AA-/Watch Neg
           C               BBB+          A-/Watch Neg
           D               BB+           BBB/Watch Neg
           E1              BB-           BBB-/Watch Neg
           E2              BB-           BBB-/Watch Neg
           P (combo)       BB-           BBB-/Watch Neg

                         Ratings Affirmed

                      Class           Rating
                      -----           ------
                      A1              AAA
                      A2              AAA


PANTHER CDO: S&P Cuts Rating on Class E Notes to 'B-'
-----------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
Panther CDO V B.V.'s class A2, B, C, D, and E notes and removed
classes B to E from CreditWatch negative.  At the same time, S&P
affirmed its rating on the class A1 notes.

These rating actions follow S&P's assessment of the transaction
performance using data from the May 31, 2010 trustee report, in
addition to its cash flow analysis.

S&P has applied its updated criteria for corporate CDOs or the
portion of the pool that comprises corporate loans, assessed the
credit deterioration in the transaction portfolio, and conducted a
cash flow analysis of all the assets in the portfolio.

S&P observes that the deterioration in the credit quality of the
portfolio and the application of its Sept. 17, 2009 criteria for
corporate CDOs has caused an increase in the scenario default
rates for this transaction.

S&P also subjected the capital structure to a cash flow analysis
to determine the break-even default rate for each rated class of
notes.  In this analysis, S&P used the reported portfolio balance,
weighted-average spread, and weighted-average recovery rates.  S&P
incorporated various cash flow stress scenarios using alternative
default patterns, levels, and timing for each liability rating
category (i.e., 'AAA', 'AA', and 'BBB'), in conjunction with
different interest stress scenarios.  From this analysis, S&P
obtained BDRs for each rated class of notes that exceeds the SDRs
S&P obtained when running the existing portfolio through CDO
Evaluator.

In S&P's opinion, the existing credit enhancement in this
transaction is not sufficient to support the current ratings on
any class except A1.  As a result, S&P has lowered the ratings on
the class A2, B, C, D, and E notes to the levels S&P believes are
commensurate with the available credit enhancement.

Following a breach of all the overcollateralization tests, S&P has
observed that payments that would otherwise be used to pay
interest on the class, B, C, D, and E notes have reduced the
notional balance of the class A1 notes from its initial amount.
S&P has affirmed its 'AAA' rating on the class A1 notes as its
cash flow analysis demonstrates that the amount of credit
enhancement available to the class A1 notes is commensurate with a
'AAA' rating.

None of the ratings was affected by either the largest obligor
default test or the largest industry default test -- two
supplemental stress tests S&P introduced as part of S&P's criteria
update.

Panther CDO V is a cash flow collateralized debt obligation of
loans to mainly speculative-grade corporate firms, and European
structured finance assets, including commercial mortgage-backed
securities, residential mortgage-backed securities, consumer
asset-backed securities, and leverage loan-based CDO assets.  It
closed in August 2007.

                           Ratings List

                        Panther CDO V B.V.
                EUR350 Million Floating-Rate Notes

                          Rating Lowered

                                     Rating
                                     ------
                Class           To            From
                -----           --            ----
                A2              AA+           AAA

      Ratings Lowered and Removed From CreditWatch Negative

                                Rating
                                ------
           Class           To            From
           -----           --            ----
           B               A+            AA-/Watch Neg
           C               BBB           A-/Watch Neg
           D               B+            BBB-/Watch Neg
           E               B-            BB/Watch Neg

                         Rating Affirmed

                      Class           Rating
                      -----           ------
                      A1              AAA


=============
R O M A N I A
=============


* ROMANIA: Banks Ready for Debt-for-Equity Swap
-----------------------------------------------
Razvan Voican and Cristi Moga at Ziarul Financiar report that
several banks are already thinking of taking over stakes in
companies under restructuring in exchange for the loans granted,
once the National Bank of Romania approves the draft regulation
that allows the temporary holding of equity as part of assistance
operations aimed at debt recovery.

Ordinance 99/2006, which regulates the operation of financial
institutions, does not, however, allow local banks to have
qualifying holdings yet, which would afford them control over
entities outside the financial sector, the report notes.


===========
R U S S I A
===========


EVROFINANCE MOSNARBANK: Fitch Upgrades Long-Term IDR to 'B+'
------------------------------------------------------------
Fitch Ratings has upgraded the Long-term Issuer Default Ratings of
three Moscow-based Russian banks: Evrofinance Mosnarbank to 'B+'
from 'B', and Russian Universal Bank and JSC SDM Bank to 'B' from
'B-'.  Fitch has simultaneously removed each of the banks from
Rating Watch Positive, and assigned Stable Outlooks to their Long-
term IDRs.

The rating actions resolve the rating watches Fitch placed on the
banks' ratings on 5 March 2010, and are part of a broader ongoing
review of the ratings of privately-owned Russian banks.  The
upgrades of the three banks reflects the strengthening of certain
aspects of Russia's banking system infrastructure during the
global financial crisis, most notably in respect of banks' ability
to access liquidity, but also in regard to the establishment of
more orderly procedures for the management of bank failures.  The
upgrades also consider the currently comfortable liquidity
cushions at all three banks, their reasonable asset quality
performance during the crisis, strong (EMB and Rusuniversal) or
solid capital positions and their generally cautious approach to
balance sheet management and risk taking.

At the same time, the banks' ratings are constrained by their
limited scale and franchise and resulting doubts about the long-
term sustainability of their business models, as well as high
concentrations on both sides of the balance sheet.  Significant
relationship-based lending to a limited number of customers at
Rusuniversal is a notable source of risk, while considerable real
estate lending exposure and large securities holdings at both EMB
and SDM give rise to additional credit and market risk.

EMB is primarily involved in corporate lending (82% of gross loans
at end-Q110) and concentration has been historically high: at end-
Q110 the top-20 loan exposures accounted for 77% of gross loans,
although a more comfortable 100% of equity.  Exposure to the
construction sector was a high 37% of gross loans at end-Q110, but
Fitch was informed that roughly a third of this exposure was
repaid in early June 2010, while remaining exposures mostly relate
to projects commissioned by the Moscow City government.  NPLs
(loans overdue by more than 90 days) were a significant 10% at
end-Q110, and rolled-over loans made up another 10% at the same
date.  However, these figures should be viewed in the context of a
contracting loan book and high loan loss absorption capacity.
Furthermore, Fitch was informed that in May 2010 EMB recovered one
loan, resulting in a halving of outstanding NPLs.  Liquidity is
supported by cash (9% of assets at end-Q110), bonds (23% of assets
at-end-Q110 with 75% of these eligible for refinancing with the
Central Bank of Russia (CBR)) and short-term interbank assets
(9%).  Unsecured facilities from the CBR are currently unutilized.
EMB's regulatory capital ratio was a strong 40% at end-May 2010.

SDM, which lends primarily to the SME segment, reported NPLs of a
moderate 3.6% of gross loans at end-Q110 and restructured loans of
2% at end-May 2010.  However, taking into account the sale of
problem loans in 2009 (equivalent to 7% of its end-Q110 loan book)
and foreclosed property still on balance sheet (4% equivalent),
asset quality deterioration during the crisis was somewhat greater
than that captured by the current loan impairment numbers.  The
bank's exposure to the real estate sector is sizeable, accounting
for 30% of gross loans at end-Q110.  However, only a half of this
is associated with construction projects, with most of the rest
relating to the commercial real estate rental business.  The level
of IFRS loan impairment reserves was 7.7% of gross loans at end-
Q110, which is adequate relative to current NPLs, while the Basel
tier 1 and total capital ratios stood at 14.4% and 17.7%,
respectively, at the same date.  The bank's liquidity position is
comfortable, underpinned by a significant cash cushion (10% of
assets at end-Q110), short-term interbank placements (7%) and a
sizable securities portfolio (43% of the bank's assets at end-
Q110, comprising predominantly Russian sovereign or investment
grade rated quasi-sovereign exposure and all currently unpledged).

Rusuniversal is primarily involved in servicing a limited number
of corporates from the defence sector, which accounts for the bulk
of both lending and customer funding.  Concentration by borrower
is extremely high, with just 17 corporate borrowers in the loan
book at end-February 2010.  However, the loan book is largely
funded out of the bank's equity, and the regulatory capital ratio
was a high 77% at end-April 2010.  Rusuniversal continues to
report zero NPLs.  The liquidity position can be potentially
volatile due to concentrated and undiversified funding, but was
adequate at end-5M10, underpinned by liquid assets holdings (cash,
short-term interbank and unpledged government securities) which
comprised 24% of total assets or 57% of customer funding.

The rating actions are:

Evrofinance Mosnarbank

  -- Long-term foreign currency IDR: upgraded to 'B+' from 'B';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B+'; Outlook
     Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'


  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'A-(rus)' from
     'BBB(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

Russian Universal Bank

  -- Long-term foreign currency IDR: upgraded to 'B' from 'B-';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B'; Outlook Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D/E'; removed from Rating
     Watch Positive

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'BBB-(rus)' from
     'BB(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

JSC SDM-Bank

  -- Long-term foreign currency IDR: upgraded to 'B' from 'B-';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B', Outlook Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'D' from 'D/E'; removed from
     Rating Watch Positive

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'BBB(rus)' from 'BB-
     (rus)'; removed from Rating Watch Positive; assigned Stable
     Outlook


RUSSIAN UNIVERSAL: Fitch Upgrades Long-Term IDR to 'B'
------------------------------------------------------
Fitch Ratings has upgraded the Long-term Issuer Default Ratings of
three Moscow-based Russian banks: Evrofinance Mosnarbank to 'B+'
from 'B', and Russian Universal Bank and JSC SDM Bank to 'B' from
'B-'.  Fitch has simultaneously removed each of the banks from
Rating Watch Positive, and assigned Stable Outlooks to their Long-
term IDRs.

The rating actions resolve the rating watches Fitch placed on the
banks' ratings on 5 March 2010, and are part of a broader ongoing
review of the ratings of privately-owned Russian banks.  The
upgrades of the three banks reflects the strengthening of certain
aspects of Russia's banking system infrastructure during the
global financial crisis, most notably in respect of banks' ability
to access liquidity, but also in regard to the establishment of
more orderly procedures for the management of bank failures.  The
upgrades also consider the currently comfortable liquidity
cushions at all three banks, their reasonable asset quality
performance during the crisis, strong (EMB and Rusuniversal) or
solid capital positions and their generally cautious approach to
balance sheet management and risk taking.

At the same time, the banks' ratings are constrained by their
limited scale and franchise and resulting doubts about the long-
term sustainability of their business models, as well as high
concentrations on both sides of the balance sheet.  Significant
relationship-based lending to a limited number of customers at
Rusuniversal is a notable source of risk, while considerable real
estate lending exposure and large securities holdings at both EMB
and SDM give rise to additional credit and market risk.

EMB is primarily involved in corporate lending (82% of gross loans
at end-Q110) and concentration has been historically high: at end-
Q110 the top-20 loan exposures accounted for 77% of gross loans,
although a more comfortable 100% of equity.  Exposure to the
construction sector was a high 37% of gross loans at end-Q110, but
Fitch was informed that roughly a third of this exposure was
repaid in early June 2010, while remaining exposures mostly relate
to projects commissioned by the Moscow City government.  NPLs
(loans overdue by more than 90 days) were a significant 10% at
end-Q110, and rolled-over loans made up another 10% at the same
date.  However, these figures should be viewed in the context of a
contracting loan book and high loan loss absorption capacity.
Furthermore, Fitch was informed that in May 2010 EMB recovered one
loan, resulting in a halving of outstanding NPLs.  Liquidity is
supported by cash (9% of assets at end-Q110), bonds (23% of assets
at-end-Q110 with 75% of these eligible for refinancing with the
Central Bank of Russia (CBR)) and short-term interbank assets
(9%).  Unsecured facilities from the CBR are currently unutilized.
EMB's regulatory capital ratio was a strong 40% at end-May 2010.

SDM, which lends primarily to the SME segment, reported NPLs of a
moderate 3.6% of gross loans at end-Q110 and restructured loans of
2% at end-May 2010.  However, taking into account the sale of
problem loans in 2009 (equivalent to 7% of its end-Q110 loan book)
and foreclosed property still on balance sheet (4% equivalent),
asset quality deterioration during the crisis was somewhat greater
than that captured by the current loan impairment numbers.  The
bank's exposure to the real estate sector is sizeable, accounting
for 30% of gross loans at end-Q110.  However, only a half of this
is associated with construction projects, with most of the rest
relating to the commercial real estate rental business.  The level
of IFRS loan impairment reserves was 7.7% of gross loans at end-
Q110, which is adequate relative to current NPLs, while the Basel
tier 1 and total capital ratios stood at 14.4% and 17.7%,
respectively, at the same date.  The bank's liquidity position is
comfortable, underpinned by a significant cash cushion (10% of
assets at end-Q110), short-term interbank placements (7%) and a
sizable securities portfolio (43% of the bank's assets at end-
Q110, comprising predominantly Russian sovereign or investment
grade rated quasi-sovereign exposure and all currently unpledged).

Rusuniversal is primarily involved in servicing a limited number
of corporates from the defence sector, which accounts for the bulk
of both lending and customer funding.  Concentration by borrower
is extremely high, with just 17 corporate borrowers in the loan
book at end-February 2010.  However, the loan book is largely
funded out of the bank's equity, and the regulatory capital ratio
was a high 77% at end-April 2010.  Rusuniversal continues to
report zero NPLs.  The liquidity position can be potentially
volatile due to concentrated and undiversified funding, but was
adequate at end-5M10, underpinned by liquid assets holdings (cash,
short-term interbank and unpledged government securities) which
comprised 24% of total assets or 57% of customer funding.

The rating actions are:

Evrofinance Mosnarbank

  -- Long-term foreign currency IDR: upgraded to 'B+' from 'B';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B+'; Outlook
     Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'


  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'A-(rus)' from
     'BBB(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

Russian Universal Bank

  -- Long-term foreign currency IDR: upgraded to 'B' from 'B-';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B'; Outlook Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D/E'; removed from Rating
     Watch Positive

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'BBB-(rus)' from
     'BB(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

JSC SDM-Bank

  -- Long-term foreign currency IDR: upgraded to 'B' from 'B-';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B', Outlook Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'D' from 'D/E'; removed from
     Rating Watch Positive

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'BBB(rus)' from 'BB-
     (rus)'; removed from Rating Watch Positive; assigned Stable
     Outlook


SDM-BANK JSC: Fitch Upgrades Long-Term IDR to 'B'
-------------------------------------------------
Fitch Ratings has upgraded the Long-term Issuer Default Ratings of
three Moscow-based Russian banks: Evrofinance Mosnarbank to 'B+'
from 'B', and Russian Universal Bank and JSC SDM Bank to 'B' from
'B-'.  Fitch has simultaneously removed each of the banks from
Rating Watch Positive, and assigned Stable Outlooks to their Long-
term IDRs.

The rating actions resolve the rating watches Fitch placed on the
banks' ratings on 5 March 2010, and are part of a broader ongoing
review of the ratings of privately-owned Russian banks.  The
upgrades of the three banks reflects the strengthening of certain
aspects of Russia's banking system infrastructure during the
global financial crisis, most notably in respect of banks' ability
to access liquidity, but also in regard to the establishment of
more orderly procedures for the management of bank failures.  The
upgrades also consider the currently comfortable liquidity
cushions at all three banks, their reasonable asset quality
performance during the crisis, strong (EMB and Rusuniversal) or
solid capital positions and their generally cautious approach to
balance sheet management and risk taking.

At the same time, the banks' ratings are constrained by their
limited scale and franchise and resulting doubts about the long-
term sustainability of their business models, as well as high
concentrations on both sides of the balance sheet.  Significant
relationship-based lending to a limited number of customers at
Rusuniversal is a notable source of risk, while considerable real
estate lending exposure and large securities holdings at both EMB
and SDM give rise to additional credit and market risk.

EMB is primarily involved in corporate lending (82% of gross loans
at end-Q110) and concentration has been historically high: at end-
Q110 the top-20 loan exposures accounted for 77% of gross loans,
although a more comfortable 100% of equity.  Exposure to the
construction sector was a high 37% of gross loans at end-Q110, but
Fitch was informed that roughly a third of this exposure was
repaid in early June 2010, while remaining exposures mostly relate
to projects commissioned by the Moscow City government.  NPLs
(loans overdue by more than 90 days) were a significant 10% at
end-Q110, and rolled-over loans made up another 10% at the same
date.  However, these figures should be viewed in the context of a
contracting loan book and high loan loss absorption capacity.
Furthermore, Fitch was informed that in May 2010 EMB recovered one
loan, resulting in a halving of outstanding NPLs.  Liquidity is
supported by cash (9% of assets at end-Q110), bonds (23% of assets
at-end-Q110 with 75% of these eligible for refinancing with the
Central Bank of Russia (CBR)) and short-term interbank assets
(9%).  Unsecured facilities from the CBR are currently unutilized.
EMB's regulatory capital ratio was a strong 40% at end-May 2010.

SDM, which lends primarily to the SME segment, reported NPLs of a
moderate 3.6% of gross loans at end-Q110 and restructured loans of
2% at end-May 2010.  However, taking into account the sale of
problem loans in 2009 (equivalent to 7% of its end-Q110 loan book)
and foreclosed property still on balance sheet (4% equivalent),
asset quality deterioration during the crisis was somewhat greater
than that captured by the current loan impairment numbers.  The
bank's exposure to the real estate sector is sizeable, accounting
for 30% of gross loans at end-Q110.  However, only a half of this
is associated with construction projects, with most of the rest
relating to the commercial real estate rental business.  The level
of IFRS loan impairment reserves was 7.7% of gross loans at end-
Q110, which is adequate relative to current NPLs, while the Basel
tier 1 and total capital ratios stood at 14.4% and 17.7%,
respectively, at the same date.  The bank's liquidity position is
comfortable, underpinned by a significant cash cushion (10% of
assets at end-Q110), short-term interbank placements (7%) and a
sizable securities portfolio (43% of the bank's assets at end-
Q110, comprising predominantly Russian sovereign or investment
grade rated quasi-sovereign exposure and all currently unpledged).

Rusuniversal is primarily involved in servicing a limited number
of corporates from the defence sector, which accounts for the bulk
of both lending and customer funding.  Concentration by borrower
is extremely high, with just 17 corporate borrowers in the loan
book at end-February 2010.  However, the loan book is largely
funded out of the bank's equity, and the regulatory capital ratio
was a high 77% at end-April 2010.  Rusuniversal continues to
report zero NPLs.  The liquidity position can be potentially
volatile due to concentrated and undiversified funding, but was
adequate at end-5M10, underpinned by liquid assets holdings (cash,
short-term interbank and unpledged government securities) which
comprised 24% of total assets or 57% of customer funding.

The rating actions are:

Evrofinance Mosnarbank

  -- Long-term foreign currency IDR: upgraded to 'B+' from 'B';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B+'; Outlook
     Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'


  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'A-(rus)' from
     'BBB(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

Russian Universal Bank

  -- Long-term foreign currency IDR: upgraded to 'B' from 'B-';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B'; Outlook Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D/E'; removed from Rating
     Watch Positive

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'BBB-(rus)' from
     'BB(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

JSC SDM-Bank

  -- Long-term foreign currency IDR: upgraded to 'B' from 'B-';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'B', Outlook Stable

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'D' from 'D/E'; removed from
     Rating Watch Positive

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term rating: upgraded to 'BBB(rus)' from 'BB-
     (rus)'; removed from Rating Watch Positive; assigned Stable
     Outlook


TRANSCREDITBANK JSC: Moody's Gives Stable Outlook on 'D-' Rating
----------------------------------------------------------------
Moody's Investors Service has changed the outlook on the D- bank
financial strength rating, Ba1 long-term global foreign currency
deposit rating as well as Ba1 senior unsecured debt ratings of
TransCreditBank, to stable from negative.  The bank is controlled
by state-owned monopoly, Russian Railways.

The change in outlook reflects a stabilization in the asset
quality of the bank, adequate provisioning against problem loans
and increased capitalization levels.

At year-end 2009, TCB reported non-performing loans (NPLs, 90+
days overdue) at 5% of the corporate loan book, and slightly over
7% of the corporate loan book was restructured.  "These results
are materially better than the industry average in Russia and they
reflect the niche market in which the bank operates, i.e.,
catering primarily to the needs of large corporations in the
railway sector and ancillary industries", said Vladlen Kuznetsov,
a Moscow-based Moody's Assistant Vice President-Analyst and lead
analyst for this issuer.

Thanks to equity injections by RR, TCB reported a total capital
adequacy ratio of 14.6% (Tier 1: 8.4%) at year-end 2009.  "This
higher level of capitalization was achieved at the same time as a
build-up in loan loss reserves which now cover NPLs by a factor of
1.5 times," added Mr. Kuznetsov.  The rating agency also
highlights that TCB's funding base has shown resilience during the
crisis, thanks to the sizable deposits coming from RR, its
affiliates and its large business partners.

The change in outlook also reflects Moody's expectation that the
relationship between the bank and RR is unlikely to change
materially in the next eighteen months.  At the same time, Moody's
cautions that the ratings remain constrained by some uncertainty
regarding this relationship in the longer term, given RR's stated
desire to decrease its ownership position in TCB.  Moody's
previous rating action on TCB was on 8 April 2009 when the rating
agency changed the outlook on the bank's ratings to negative from
stable.

Headquartered in Moscow, TCB had total assets of ca.
RUB260 billion and equity of RUB20 billion at year-end 2009.
TCB's main focus has been on servicing the needs of large
corporations in the railway sector and ancillary industries, and
the bank has its branch network in locations that enable it to
better provide services to its parent's regional entities and
their employees.


URALSVYAZINFORM OJSC: S&P Puts 'B+' Rating on Watch Developing
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it had placed its
global scale 'B+' long-term corporate credit rating on Russian
telecoms operator Uralsvyazinform (OJSC) on CreditWatch with
developing implications.

The CreditWatch placement reflects the uncertainties triggered by
Uralsvyazinform's decision to reorganize in order to be merged
into OJSC Rostelecom (BB/Stable/--).

"S&P is particularly concerned about the potential impact of
reorganization on the company's liquidity position which, if it
deteriorates, could put downward pressure on the rating," said
Standard & Poor's credit analyst Alexander GriazNov. "At the same,
S&P would view as positive for the rating a merger of
Uralsvyazinform into the larger Rostelecom entity, assuming the
absence of any technical or actual liquidity concerns coming out
of the reorganization process."

On June 23, 2010, the company's annual shareholders meeting
approved Uralsvyazinform's reorganization for merger into
Rostelecom.  This transaction is part of the restructuring of
state-owned telecoms holding company Svyazinvest OJSC and must
also be approved by Rostelecom's shareholders.  In compliance with
Russian legislation, all of Uralsvyazinform's debt holders have
the legal right to claim from the company early repayment of their
debt in court.

Although S&P has reason to believe that most debt holders will
waive this right, as their Uralsvyazinform debt will be swapped
into debt of Rostelecom -- a company S&P considers to be a
stronger entity -- the amount of these potential claims remains an
uncertainty.  In addition, Uralsvyazinform shareholders opposing
the reorganization have the right to sell their stock to the
company.  Although the latter right is limited to 10% of the
company's net assets, it potentially creates additional pressure
on Uralsvyazinform's liquidity position.

The rating on Uralsvyazinform is constrained by S&P's view of the
company's exposure to weak Russian capital markets, which limits
the company's liquidity; a weakening domestic economic
environment; and intense competition in the mobile segment.
Uncertainties related to the reorganization of Uralsvyazinform's
parent company Svyazinvest are additional rating constraints.

The rating is supported by Uralsvyazinform's cash-generative
profile, dominant position in the Ural region's fixed-line
segment, resilient market share in mobile telephony, and rapidly
expanding broadband segment.

S&P expects to resolve the CreditWatch placement within the next
three months.  S&P will analyze the impact of the reorganization
on Uralsvyazinform's liquidity position.  S&P will compare the
total amount of financial claims on Uralsvyazinform from
debtholders and shareholders with the available liquidity
resources.

"Based on this information, S&P could affirm, lower, or raise the
rating," said Mr. Griaznov.


ZENIT BANK: Moody's Changes Outlook on 'Ba3' Rating to Stable
-------------------------------------------------------------
Moody's Investors Service has changed the outlook on the D- bank
financial strength rating, the Ba3 long-term global foreign
currency deposit rating of Zenit Bank to stable from negative.

The change in outlook on Zenit Bank's ratings reflects
stabilisation of the asset quality of the bank as well as
sufficient coverage of problem loans by provisions, and thus
decreased pressure on the bank's financial fundamentals,
especially as regards capital adequacy.

"Thanks to historically conservative underwriting standards, as of
31 December 2009 Zenit Bank reported non-performing loans (NPLs,
90+ days overdue) at 7.4% of the corporate book, and close to 8%
of the loan book was restructured.  The 7.6% level of provisioning
created by the bank at end of 2009 is commensurate with the level
of expected losses," said Elena Redko, a Moscow-based Moody's
Analyst and lead analyst for this issuer.

Furthermore, Zenit Bank reported a total capital adequacy ratio of
18.6% (Tier 1: 12.8%) at year-end 2009, which was supported by
Tier 2 capital injection and recurring profitability.  Moody's
notes that Zenit Bank demonstrated reasonable financial
performance in 2009 as it was able to generate a stable flow of
interest and commission income sufficient to cover an increased
level of provisioning.  The rating agency also highlights that
Zenit Bank's funding base demonstrated resilience to crisis events
both in the retail and corporate segment.

Moody's previous rating action on Zenit Bank was on 7 April 2009
when the rating agency changed the outlook on the bank's ratings
to negative from stable.

Headquartered in Moscow, Zenit Bank reported total consolidated
IFRS assets of RUB186 billion (US$6.2 billion) and net
consolidated income of RUB2.1 billion (US$69.1 million) at year-
end 2009.


* Fitch Assigns 'BB-' Rating on Republic of Karelia's Bonds
-----------------------------------------------------------
Fitch Ratings has assigned the Republic of Karelia's RUB1 billion
domestic bond issue (ISIN RU000A0JQX51), due 18 June 2015, a final
Long-term local currency rating 'BB-' and National Long-term
rating of 'A+(rus)'.

The republic has Long-term local and foreign currency ratings of
'BB-', respectively, and a National Long-term rating of 'A+(rus)'.
The Long-term ratings have Stable Outlooks.  The republic's Short-
term foreign currency rating is 'B'.

The bond issue has a fixed-rate step-down coupon.  The rate for
the first coupon has been set at 9.91% at the auction.  The
proceeds from the bond issue will be used to refinance maturing
debt and to fund capital expenditure.

The Republic of Karelia is located in the northwest of the Russian
Federation and accounts for 0.4% of Russia's GDP and around 0.5%
of its population.


=====================================
S E R B I A   &   M O N T E N E G R O
=====================================


* CITY OF KRALJEVO: Moody's Assigns 'B1' Issuer Rating
------------------------------------------------------
Moody's Investors Service has assigned a first-time issuer rating
of Ba3 to the Serbian City of Novi Sad as well as B1 ratings to
the Cities of Kraljevo and Valjevo.  The ratings have a stable
outlook.

These ratings are underpinned by the cities' sound overall
budgetary performances and limited direct-debt exposure.  However,
the rating agency cautions that this should be considered in the
context of the young and unsettled institutional and financial
frameworks that govern Serbian local governments, which might be
subject to further adjustments in coming years.  The ratings also
reflect the cities' constrained revenue and expenditure
flexibility and high infrastructure needs, both of which are
typical for Serbian municipalities.

"The City of Novi Sad's prudent budgetary management, which
underpins its Ba3 rating, is evidenced by stable operating
margins, particularly in 2009, when it managed to impose notable
cost-cutting measures to mitigate a fall in operating revenue of
8%, driven by economic recession," said Katerina Hanzlova, Moody's
lead analyst for Novi Sad and Valjevo.  The rating also takes into
account the lack of direct debt as well as the city's good cash
reserves, which helped to cover the financial deficit it posted in
2009.  The deficit was caused by a significant drop in the
cyclically sensitive land development fee (a key source of capital
revenue), which decreased the city's investment-financing capacity
in 2009; this is unlikely to fully recover until 2011.  "If
investment plans are not scaled down accordingly, the city might
be forced to finance them with debt.  However, this is not
anticipated, at least in 2010," added Mrs. Hanzlova.

"The City of Kraljevo's rating of B1 reflects its flexible capex
implementation strategy, which has enabled it to maintain a
balanced budgetary performance and to preserve its direct debt-
free status over the past three years," said Miroslav Knazko, a
Moody's Assistant Vice President and lead analyst for Kraljevo.
"However, Moody's notes that the contraction in the local economy,
together with severe cuts in central government transfers have
weighed on the city's already volatile operating performance since
2009.  Kraljevo will have to tighten expenditures in order to
maintain a positive operating performance as key tax revenues are
expected to remain constrained by a slow economic recovery,"
continued Mr. Knazko.  Nevertheless, the rating agency does not
expect any material changes in Kraljevo's budgetary performances,
as the management's cautious capex implementation strategy, which
relies heavily on the city's own-source revenue, remains in place
and the involvement of debt is still in the early stages.
Moreover, these borrowings are not expected to exceed 12% of the
city's operating revenue in the foreseeable future, thus the
potential debt burden appears to be manageable.

The City of Valjevo's rating of B1 reflects the city's responsible
budget and debt management policies over the past four years,
which have helped to maintain a balanced financial performance,
contained debt levels and manageable debt service.  However, the
rating remains constrained by the city's dramatically declining,
albeit still solid, operating margins, which are influenced by the
city's limited revenue and expenditure flexibility.  "If the city
is able to implement cuts to its operating expenditure in 2010,
GOB could stabilize around 20% of operating revenue in 2010,
sustained largely by sound tax proceeds," said Mrs. Hanzlova.
Moody's notes that it will become increasingly necessary for
Valjevo to stabilize its operating margins in the future in order
to ensure sufficient debt repayment capacity for its newly planned
loan and to finance its investment requirements.

With almost 300,000 inhabitants, Novi Sad is Serbia's second-
largest city.  It is the capital of the northern Serbian
Autonomous Province of Vojvodina and an important industrial,
cultural and financial centre of Serbia.  Novi Sad was one of the
most developed cities in the former Yugoslavia.  The local economy
has grown strongly in the past decade, shifting from an industry-
driven economy to the tertiary sector.  State enterprises went
through a privatization processes and small and medium-size
enterprises dominate the city's economy.  Positive local economic
development is reflected in the comparatively favorable registered
unemployment rate (18% in 2009 compared to the national average of
26%).

Kraljevo is located 180 kilometers south of Serbia's capital city
of Belgrade and is home to about 120,000 inhabitants.  It is the
economic and industrial centre of south-west Serbia.  Its
industrial sector has significantly deteriorated with the
country's long-lasting transition from a centrally planned
economy.  Those remaining industries include the production of
cargo trucks, electro-mechanic, food, wood and plastic processing,
which all continue to play an important role in the local economy.
However, the tertiary sector, dominated by public services,
logistics, construction and retail commerce has already become a
backbone of the local economy.  The relative weakness of the local
economy is reflected in a comparatively unfavorable unemployment
rate and a lower average income per capita.

The City of Valjevo has almost 100,000 inhabitants and is situated
in western Serbia.  Its distance from Belgrade is 100 kilometers
and it is situated near one of the most important traffic route of
the republic -- Ibarska Highway.  Valjevo's economy has a long
industrial tradition, which has attracted a number of foreign
companies.  Particularly important for the local economy are small
and medium-sized enterprises, private workshops and retail stores.
Thanks to its strong industrial base and buoyant local economy,
Valjevo has comparatively low registered unemployment rates, 16.5%
in 2009 compared to the national average of 26%.


* CITY OF NOVI SAD: Moody's Assigns 'Ba3' Issuer Rating
-------------------------------------------------------
Moody's Investors Service has assigned a first-time issuer rating
of Ba3 to the Serbian City of Novi Sad as well as B1 ratings to
the Cities of Kraljevo and Valjevo.  The ratings have a stable
outlook.

These ratings are underpinned by the cities' sound overall
budgetary performances and limited direct-debt exposure.  However,
the rating agency cautions that this should be considered in the
context of the young and unsettled institutional and financial
frameworks that govern Serbian local governments, which might be
subject to further adjustments in coming years.  The ratings also
reflect the cities' constrained revenue and expenditure
flexibility and high infrastructure needs, both of which are
typical for Serbian municipalities.

"The City of Novi Sad's prudent budgetary management, which
underpins its Ba3 rating, is evidenced by stable operating
margins, particularly in 2009, when it managed to impose notable
cost-cutting measures to mitigate a fall in operating revenue of
8%, driven by economic recession," said Katerina Hanzlova, Moody's
lead analyst for Novi Sad and Valjevo.  The rating also takes into
account the lack of direct debt as well as the city's good cash
reserves, which helped to cover the financial deficit it posted in
2009.  The deficit was caused by a significant drop in the
cyclically sensitive land development fee (a key source of capital
revenue), which decreased the city's investment-financing capacity
in 2009; this is unlikely to fully recover until 2011.  "If
investment plans are not scaled down accordingly, the city might
be forced to finance them with debt.  However, this is not
anticipated, at least in 2010," added Mrs. Hanzlova.

"The City of Kraljevo's rating of B1 reflects its flexible capex
implementation strategy, which has enabled it to maintain a
balanced budgetary performance and to preserve its direct debt-
free status over the past three years," said Miroslav Knazko, a
Moody's Assistant Vice President and lead analyst for Kraljevo.
"However, Moody's notes that the contraction in the local economy,
together with severe cuts in central government transfers have
weighed on the city's already volatile operating performance since
2009.  Kraljevo will have to tighten expenditures in order to
maintain a positive operating performance as key tax revenues are
expected to remain constrained by a slow economic recovery,"
continued Mr. Knazko.  Nevertheless, the rating agency does not
expect any material changes in Kraljevo's budgetary performances,
as the management's cautious capex implementation strategy, which
relies heavily on the city's own-source revenue, remains in place
and the involvement of debt is still in the early stages.
Moreover, these borrowings are not expected to exceed 12% of the
city's operating revenue in the foreseeable future, thus the
potential debt burden appears to be manageable.

The City of Valjevo's rating of B1 reflects the city's responsible
budget and debt management policies over the past four years,
which have helped to maintain a balanced financial performance,
contained debt levels and manageable debt service.  However, the
rating remains constrained by the city's dramatically declining,
albeit still solid, operating margins, which are influenced by the
city's limited revenue and expenditure flexibility.  "If the city
is able to implement cuts to its operating expenditure in 2010,
GOB could stabilize around 20% of operating revenue in 2010,
sustained largely by sound tax proceeds," said Mrs. Hanzlova.
Moody's notes that it will become increasingly necessary for
Valjevo to stabilize its operating margins in the future in order
to ensure sufficient debt repayment capacity for its newly planned
loan and to finance its investment requirements.

With almost 300,000 inhabitants, Novi Sad is Serbia's second-
largest city.  It is the capital of the northern Serbian
Autonomous Province of Vojvodina and an important industrial,
cultural and financial centre of Serbia.  Novi Sad was one of the
most developed cities in the former Yugoslavia.  The local economy
has grown strongly in the past decade, shifting from an industry-
driven economy to the tertiary sector.  State enterprises went
through a privatization processes and small and medium-size
enterprises dominate the city's economy.  Positive local economic
development is reflected in the comparatively favorable registered
unemployment rate (18% in 2009 compared to the national average of
26%).

Kraljevo is located 180 kilometers south of Serbia's capital city
of Belgrade and is home to about 120,000 inhabitants.  It is the
economic and industrial centre of south-west Serbia.  Its
industrial sector has significantly deteriorated with the
country's long-lasting transition from a centrally planned
economy.  Those remaining industries include the production of
cargo trucks, electro-mechanic, food, wood and plastic processing,
which all continue to play an important role in the local economy.
However, the tertiary sector, dominated by public services,
logistics, construction and retail commerce has already become a
backbone of the local economy.  The relative weakness of the local
economy is reflected in a comparatively unfavorable unemployment
rate and a lower average income per capita.

The City of Valjevo has almost 100,000 inhabitants and is situated
in western Serbia.  Its distance from Belgrade is 100 kilometers
and it is situated near one of the most important traffic route of
the republic -- Ibarska Highway.  Valjevo's economy has a long
industrial tradition, which has attracted a number of foreign
companies.  Particularly important for the local economy are small
and medium-sized enterprises, private workshops and retail stores.
Thanks to its strong industrial base and buoyant local economy,
Valjevo has comparatively low registered unemployment rates, 16.5%
in 2009 compared to the national average of 26%.


* CITY OF VALJEVO: Moody's Assigns 'B1' Issuer Rating
-----------------------------------------------------
Moody's Investors Service has assigned a first-time issuer rating
of Ba3 to the Serbian City of Novi Sad as well as B1 ratings to
the Cities of Kraljevo and Valjevo.  The ratings have a stable
outlook.

These ratings are underpinned by the cities' sound overall
budgetary performances and limited direct-debt exposure.  However,
the rating agency cautions that this should be considered in the
context of the young and unsettled institutional and financial
frameworks that govern Serbian local governments, which might be
subject to further adjustments in coming years.  The ratings also
reflect the cities' constrained revenue and expenditure
flexibility and high infrastructure needs, both of which are
typical for Serbian municipalities.

"The City of Novi Sad's prudent budgetary management, which
underpins its Ba3 rating, is evidenced by stable operating
margins, particularly in 2009, when it managed to impose notable
cost-cutting measures to mitigate a fall in operating revenue of
8%, driven by economic recession," said Katerina Hanzlova, Moody's
lead analyst for Novi Sad and Valjevo.  The rating also takes into
account the lack of direct debt as well as the city's good cash
reserves, which helped to cover the financial deficit it posted in
2009.  The deficit was caused by a significant drop in the
cyclically sensitive land development fee (a key source of capital
revenue), which decreased the city's investment-financing capacity
in 2009; this is unlikely to fully recover until 2011.  "If
investment plans are not scaled down accordingly, the city might
be forced to finance them with debt.  However, this is not
anticipated, at least in 2010," added Mrs. Hanzlova.

"The City of Kraljevo's rating of B1 reflects its flexible capex
implementation strategy, which has enabled it to maintain a
balanced budgetary performance and to preserve its direct debt-
free status over the past three years," said Miroslav Knazko, a
Moody's Assistant Vice President and lead analyst for Kraljevo.
"However, Moody's notes that the contraction in the local economy,
together with severe cuts in central government transfers have
weighed on the city's already volatile operating performance since
2009.  Kraljevo will have to tighten expenditures in order to
maintain a positive operating performance as key tax revenues are
expected to remain constrained by a slow economic recovery,"
continued Mr. Knazko.  Nevertheless, the rating agency does not
expect any material changes in Kraljevo's budgetary performances,
as the management's cautious capex implementation strategy, which
relies heavily on the city's own-source revenue, remains in place
and the involvement of debt is still in the early stages.
Moreover, these borrowings are not expected to exceed 12% of the
city's operating revenue in the foreseeable future, thus the
potential debt burden appears to be manageable.

The City of Valjevo's rating of B1 reflects the city's responsible
budget and debt management policies over the past four years,
which have helped to maintain a balanced financial performance,
contained debt levels and manageable debt service.  However, the
rating remains constrained by the city's dramatically declining,
albeit still solid, operating margins, which are influenced by the
city's limited revenue and expenditure flexibility.  "If the city
is able to implement cuts to its operating expenditure in 2010,
GOB could stabilize around 20% of operating revenue in 2010,
sustained largely by sound tax proceeds," said Mrs. Hanzlova.
Moody's notes that it will become increasingly necessary for
Valjevo to stabilize its operating margins in the future in order
to ensure sufficient debt repayment capacity for its newly planned
loan and to finance its investment requirements.

With almost 300,000 inhabitants, Novi Sad is Serbia's second-
largest city.  It is the capital of the northern Serbian
Autonomous Province of Vojvodina and an important industrial,
cultural and financial centre of Serbia.  Novi Sad was one of the
most developed cities in the former Yugoslavia.  The local economy
has grown strongly in the past decade, shifting from an industry-
driven economy to the tertiary sector.  State enterprises went
through a privatization processes and small and medium-size
enterprises dominate the city's economy.  Positive local economic
development is reflected in the comparatively favorable registered
unemployment rate (18% in 2009 compared to the national average of
26%).

Kraljevo is located 180 kilometers south of Serbia's capital city
of Belgrade and is home to about 120,000 inhabitants.  It is the
economic and industrial centre of south-west Serbia.  Its
industrial sector has significantly deteriorated with the
country's long-lasting transition from a centrally planned
economy.  Those remaining industries include the production of
cargo trucks, electro-mechanic, food, wood and plastic processing,
which all continue to play an important role in the local economy.
However, the tertiary sector, dominated by public services,
logistics, construction and retail commerce has already become a
backbone of the local economy.  The relative weakness of the local
economy is reflected in a comparatively unfavorable unemployment
rate and a lower average income per capita.

The City of Valjevo has almost 100,000 inhabitants and is situated
in western Serbia.  Its distance from Belgrade is 100 kilometers
and it is situated near one of the most important traffic route of
the republic -- Ibarska Highway.  Valjevo's economy has a long
industrial tradition, which has attracted a number of foreign
companies.  Particularly important for the local economy are small
and medium-sized enterprises, private workshops and retail stores.
Thanks to its strong industrial base and buoyant local economy,
Valjevo has comparatively low registered unemployment rates, 16.5%
in 2009 compared to the national average of 26%.


=========
S P A I N
=========


AYT KUTXA: Fitch Corrects Press Release on Ratings
--------------------------------------------------
Fitch Ratings has corrected a press release published on June 23,
2010.  The correct ISIN numbers for AyT Kutxa Hipotecario II's
class B and class C notes are ISIN ES0370154017 and ISIN
ES0370154025, respectively.  A corrected version IS:

Fitch has taken rating action on two Spanish RMBS transactions,
AyT Kutxa Hipotecario I FTA and AyT Kutxa Hipotecario II FTA,
which contain loans originated by Caja de Ahorros Monte de Piedad
de Gipuzkoa y San Sebastian.  A complete breakdown of the rating
action is provided at the end of this comment.

Fitch downgraded Kutxa II's class B and C notes and revised the
Outlooks to Negative on class A to reflect the performance of the
pool to date in comparison with the agency's initial expectations.
Rising levels of defaults have resulted in substantial reserve
fund draws which have significantly reduced the credit support on
the notes.  In Fitch's view these are expected to continue until
recoveries are generated.  Given the current difficult housing
market in Spain, Fitch does not expect substantial recoveries to
be generated in the near future, without the properties being
subjected to a significant downward revaluation.

The affirmation of Kutxa I's reflects the better performance of
this pool, although the revision of the Outlook on class B and C
notes to Stable and to Negative, respectively, reflects Fitch's
expectation of increased pressure deriving from defaults,
particularly as the pool's characteristics are not dissimilar to
Kuxta II's.

Both transactions share high weighted average original loan-to-
value of 81.9% at issuance (Kutxa I) and at 84% (Kutxa II) and
regional risk concentration in the Pais Vasco, Madrid, and
Cataluna regions.  The exposure to high WAOLTV is, in Fitch's
opinion, a source of concern because these loans carry a higher
potential risk of losses.  Fitch expects house price declines in
Spain of 25%-30% and this has been taken into account in the
review of these transactions.

As of the April 2010 interest payment date loans in arrears by
more than three months stood at 0.46% and at 0.88% of the current
outstanding balance, for Kuxta I and Kuxta II respectively.
Defaults, for the same quarter, were at 0.11% and 1.93% of the
initial pool balance in Kutxa I and Kutxa II respectively.

Both transactions feature a provisioning mechanism through which
available excess spread is used to write off defaults, defined as
loans in arrears by more than 18 months.

The net excess spread available in Kutxa I has been declining over
the last three IPDs due to the increase in new quarterly defaults.
In Fitch's opinion the tightening of the excess revenue may lead
to reserve fund draws in the near future.  This is reflected in
the revision of the Outlook to Negative on the most junior
tranche.

Kutxa II has not been generating enough excess spread to cover for
new defaults, leading to several reserve fund draws.  As of the
last IPD the reserve fund stood at 0.75% of the initial note
balance (compared to 2.3% at issuance).  The downgrade of the
ratings on the class B and C notes and the change in Outlooks
reflect Fitch's concern about the pool's ability to generate
enough cash to cover new potential defaults and the speed and
level of any future recoveries.  Fitch expects further reserve
fund draws to occur as more arrears translate into default.

AyT Kutxa Hipotecario I, FTA

  -- Class A (SIN ES0370153001): affirmed at 'AAA'; Outlook
     Stable; assigned Loss Severity rating of 'LS-1'

  -- Class B (ISIN ES0370153019): affirmed at 'A'; Outlook revised
     to Stable from Positive; assigned 'LS-2'

  -- Class C (ISIN ES0370153027): affirmed at 'BBB'; Outlook
     revised to Negative from Stable; assigned 'LS-3'

AyT Kutxa Hipotecario II, FTA

  -- Class A (SIN ES0370154009): affirmed at 'AAA'; Outlook
     revised to Negative from Stable; assigned 'LS-1'

  -- Class B (ISIN ES0370154017): downgraded to 'BBB' from 'A';
     Outlook Negative; assigned 'LS-3'

  -- Class C (ISIN ES0370154025): downgraded to 'B' from 'BBB';
     Outlook Negative; assigned 'LS-3'


===========================
U N I T E D   K I N G D O M
===========================


APG VISUAL: Assets Sold to Character Mailing Services
-----------------------------------------------------
Adam Hooker at PrintWeek.com reports that APG Visual Colour has
gone into administration and its assets have been sold to a
Liverpool-based mailing house Character Mailing Services.

According to the report, of the 18 staff formerly employed at the
Stockport site, 15 have moved across to Character Mailing and
Services.

The report recalls APG went into administration with Jeremy
Woodside and Christopher Ratten, of Tenon Recovery, on May 12.

APG Visual Colour is a sheetfed magazine printer based in
Stockport.


BRITISH AIRWAYS: To Hire More Than 1,000 Lower-Paid Cabin Crew
--------------------------------------------------------------
Pilita Clark at The Financial Times reports that British Airways
plans to hire more than 1,000 cabin crew for its main UK base at
London's Heathrow airport on drastically reduced pay and
conditions.

The FT relates the airline ran full-page color newspaper
advertisements Thursdays for recruits to "a new cabin crew team"
that it plans to pay about GBP18,000 a year, nearly half the
amount now paid to most of its 11,500 Heathrow staff.

The move, which the airline says will save GBP100 million after 10
years, came two days after the Unite union that represents most of
BA's cabin crew announced a fresh strike ballot that could see a
new round of walk-outs over the summer, the FT discloses.

The FT notes BA, which has lost nearly GBP1 billion over the last
two years, said it had been discussing the recruitment drive for
new crew with Unite for the last 18 months because its Heathrow
staff costs were "way out of line" with competitors and much
higher than those paid to its 1,200 crew at Gatwick.

"We can no longer afford this cost difference," the FT quoted the
airline as saying

According to the FT, BA said it planned to recruit 1,250 new crew
over the next year, the first of whom would start flying in
November on separate flights to existing flight attendants at
Heathrow.

                      About British Airways

Headquartered in Harmondsworth, England, British Airways Plc,
along with its subsidiaries, (LON:BAY) -- http://www.ba.com/-- is
engaged in the operation of international and domestic scheduled
air services for the carriage of passengers, freight and mail and
the provision of ancillary services.  The Company's principal
place of business is Heathrow.  It also operates a worldwide air
cargo business, in conjunction with its scheduled passenger
services.  The Company operates international scheduled airline
route networks together with its codeshare and franchise partners,
and flies to more than 300 destinations worldwide.  During the
fiscal year ended March 31, 2009 (fiscal 2009), the Company
carried more than 33 million passengers.  It carried 777,000 tons
of cargo to destinations in Europe, the Americas and throughout
the world.  In July 2008, the Company's subsidiary, BA European
Limited (trading as OpenSkies), acquired the French airline,
L'Avion.

                           *     *     *

As reported in the Troubled Company Reporter-Europe on March 19,
2010, Moody's Investors Service lowered to B1 from Ba3 the
Corporate Family and Probability of Default Ratings of British
Airways plc; and the senior unsecured and subordinate ratings to
B2 and B3, respectively.  Moody's said the outlook is stable.
This concludes the review that was initiated on November 10, 2009.
The rating action reflects Moody's view that credit metrics will
not be commensurate with the previous rating category in the
medium term.  Moody's expect furthermore that metrics will be
burdened in the foreseeable future by the company's significant
pension deficit, which was at GBP2.6 billion for the APS and NAPS
schemes combined as of September 2009 (under IAS).  Moody's
nevertheless understand that under the current agreement with the
trade unions, the cash contributions to these deficits will be
frozen at GBP330 million per year for three years, subject to
approval by the Pensions Regulator and the trustees


EASSDA LTD: Owes Unsecured Creditors GBP1.35 Million
----------------------------------------------------
BBC News reports that companies owed by Eassda Ltd. have been
warned that they are unlikely to receive a penny.

According to BBC, recent public filings by the administrators of
Eassda showed that the company, which was placed in administration
in November, owes unsecured creditors GBP1.35 million.

Eassda is being administered by the financial consultancy BDO, BBC
discloses.  BBC notes BDO's report showed that at the time Eassda
went into administration it owed Ulster Bank, Northern Bank and
Bank of Ireland a combined GBP28.6 million.  BBC says BDO is
developing and selling Eassda's sites on behalf of the banks but
the value of most of those sites has plunged in the property
crash.

Eassda Ltd. is a building firm based in Templepatrick.  The
company built houses mainly in County Antrim, according to BBC.


EURO CONSTRUCTION: Owes Unsecured Creditors GBP2.61 Million
-----------------------------------------------------------
BBC News reports that companies owed by Euro Construction Corp
Ltd., have been warned they are unlikely to receive a penny.

According to BBC, recent public filings by the administrators of
Euro Construction showed that the company, which was placed in
administration in Novembrer, owes unsecured creditors GBP2.61
million.

Euro Construction, which is being administered by KPMG, owed
Ulster Bank just under GBP10.5 million at the time of
administration, BBC discloses.  It also owed Allied Irish Bank
just under EUR17 million, BBC states.

The filing stated that Euro Construction's main asset is land
banks in the Drogheda area but as of May none of those lands had
been sold, BBC notes.

Euro Construction is a building firm based in Waringstown.


FABRIC 591: Bought Out of Administration; 100 Jobs Secured
----------------------------------------------------------
James Thompson at The Independent reports that
PricewaterhouseCoopers, the administrators to Fabric 591, has sold
the London nightclub to a new company recently set up by one of
its former investors, in a deal that secures 100 jobs.

According to The Independent, Gary Kilbey will become the primary
shareholder in Fabric, which fell into administration earlier this
month.

Matter, the former subsidiary of Fabric that was housed in
London's O2 arena, is to go into liquidation, The Independent
notes.

As reported by the Troubled Company Troubled Reporter-Europe on
June 4, 2010, the Financial Times said Fabric went into
administration after being hit by the downturn.  The FT disclosed
the nightclub industry has been hard hit over the past few years
as new bars mushroomed across Britain's high streets and changes
to licensing laws in 2005 increased competition by extending pub
opening hours.

Fabric is one of London's largest and best-known nightclubs.  It
has a capacity of 1,510, according to the Financial Times.


* UK: Says Bankruptcy Administrators Need Independent Overseer
--------------------------------------------------------------
Erik Larson at Bloomberg News reports that the Office of Fair
Trading said bankruptcy administrators in the U.K., who earn about
GBP1 billion (US$1.5 billion) in fees a year, should be overseen
by a new independent body with "broad" powers to issue fines and
return overcharged fees to creditors.

According to Bloomberg, the OFT on Thursday said professionals who
wind down insolvent companies or take over management until they
return to health often charge unsecured creditors higher fees than
those whose claims are backed by collateral.

Bloomberg notes the idea to create an independent overseer was
among several suggestions made by the OFT following an
investigation that began in November, after the U.K. government
raised concerns and the World Bank said bankruptcies cost more in
Britain than in other countries where results for creditors were
as good or better.

Bloomberg relates the OFT's report said the practitioners charge
about 9% more when unsecured creditors pay.  Bloomberg says banks
and other secured creditors tend to have close relationships with
bankruptcy practitioners and are able to veto corporate directors
to effectively choose who gets the job.  The OFT, as cited by
Bloomberg, said other problems may include "overly long"
liquidation cases that increase fees and deficient oversight of
the use of so-called pre-packages bankruptcies.

The regulator also said the U.K. government's Insolvency
Service, which investigates insolvent companies to find out why
they went bankrupt, should have increased powers to fine self-
regulatory bodies and take away their licenses, Bloomberg
discloses.


* UK: Banks "Vulnerable" to Asset Writedowns, BoE Report Says
-------------------------------------------------------------
Jon Menon and Gavin Finch at Bloomberg News report that the Bank
of England said U.K. banks remain "vulnerable" to further
writedowns on their assets because of a potential decline in
investor appetite for risk.

Bloomberg relates the central bank said in its semiannual
financial stability report published in London Thursday that
derivatives and other financial instruments accounted for 40%
percent of U.K. banks' total assets at the end of 2009.

"If sovereign risk concerns rise or risk appetite continues to
diminish, asset prices could fall further," Bloomberg quoted the
BOE as saying.  "This would have a significant impact on the
solvency positions of holders of these assets, including both U.K.
and global banks."

According to Bloomberg, the BoE said that while U.K. banks are
still vulnerable to a drop in asset prices, they have mitigated
that risk by reducing their holdings of credit market instruments
by 21% to GBP207 billion (US$310 billion) last year.  Writedowns
on such instruments at the four biggest U.K. banks fell to GBP9
billion in 2009, compared with losses of GBP20 billion in the
previous year, Bloomberg notes.

Bloomberg relates the BoE said the sovereign debt crisis in Europe
had increased the risk of instability in the U.K. financial
system, and banks need to raise more capital to guard against
shocks.

"The speed with which Greece's problems were transmitted to other
countries and markets highlighted persistent fault lines in the
global financial system," the bank said in the report, according
to Bloomberg.  "U.K. banks face a number of challenges and need to
maintain resilience in a difficult environment."

The central bank, as cited by Bloomberg, said U.K. banks are
"particularly exposed" to the French and German banking systems,
which account for about a quarter of their claims on banks
globally, the central bank said.

"U.K. banks face increased counterparty credit risk on exposures
to other European banks," the BoE report said, according to
Bloomberg.


===============
X X X X X X X X
===============


* BOND PRICING: For the Week June 21 to June 25, 2010
-----------------------------------------------------

Issuer               Coupon   Maturity  Currency   Price
------               ------   --------  --------   -----

AUSTRIA
-------
AUSTRIA REP OF         2.217   8/4/2025      EUR    74.75

BELGIUM
-------
FORTIS BANK            8.750  12/7/2010      EUR    14.08

FINLAND
-------
MUNI FINANCE PLC       0.250  6/28/2040      CAD    23.66
MUNI FINANCE PLC       0.500  3/17/2025      CAD    52.16
MUNI FINANCE PLC       0.500  9/24/2020      CAD    66.10
MUNI FINANCE PLC       1.000  2/27/2018      AUD    65.39
MUNI FINANCE PLC       1.000  6/30/2017      ZAR    66.37

FRANCE
------
AIR FRANCE-KLM         4.970   4/1/2015      EUR    13.76
ALCATEL SA             4.750   1/1/2011      EUR    16.29
ALCATEL-LUCENT         5.000   1/1/2015      EUR     3.22
ALTRAN TECHNOLOG       6.720   1/1/2015      EUR     4.60
ATOS ORIGIN SA         2.500   1/1/2016      EUR    50.45
CALYON                 6.000  6/18/2047      EUR    51.68
CAP GEMINI SOGET       1.000   1/1/2012      EUR    44.86
CAP GEMINI SOGET       3.500   1/1/2014      EUR    43.78
CLUB MEDITERRANE       4.375  11/1/2010      EUR    49.36
EURAZEO                6.250  6/10/2014      EUR    54.67
FAURECIA               4.500   1/1/2015      EUR    19.64
GROUPE VIAL            2.500   1/1/2014      EUR    18.11
MAUREL ET PROM         7.125  7/31/2014      EUR    16.51
NEXANS SA              4.000   1/1/2016      EUR    60.41
PEUGEOT SA             4.450   1/1/2016      EUR    29.93
PUBLICIS GROUPE        1.000  1/18/2018      EUR    46.57
PUBLICIS GROUPE        3.125  7/30/2014      EUR    38.02
RHODIA SA              0.500   1/1/2014      EUR    44.50
SOC AIR FRANCE         2.750   4/1/2020      EUR    20.07
SOITEC                 6.250   9/9/2014      EUR     9.69
TEM                    4.250   1/1/2015      EUR    53.82
THEOLIA                2.000   1/1/2014      EUR    13.40
VALEO                  2.375   1/1/2011      EUR    46.52
ZLOMREX INT FIN        8.500   2/1/2014      EUR    48.50
ZLOMREX INT FIN        8.500   2/1/2014      EUR    48.50

GERMANY
-------
DEUTSCHE BK LOND       3.000  5/18/2012      CHF    64.56
ESCADA AG              7.500   4/1/2012      EUR    17.00
EUROHYPO AG            5.000  5/15/2027      EUR    94.44
HSH NORDBANK AG        4.375  2/14/2017      EUR    67.44
L-BANK FOERDERBK       0.500  5/10/2027      CAD    47.21
LB BADEN-WUERTT        2.500  1/30/2034      EUR    73.59
QIMONDA FINANCE        6.750  3/22/2013      USD     2.38
RENTENBANK             1.000  3/29/2017      NZD    73.15
SOLON AG SOLAR         1.375  12/6/2012      EUR    41.99
VPV LEBENSVERSIC       7.250  8/17/2026      EUR    66.13

GREECE
------
HELLENIC RAILWAY       4.500  12/6/2016      JPY    66.03
HELLENIC REP I/L       2.900  7/25/2025      EUR    42.77
HELLENIC REP I/L       2.300  7/25/2030      EUR    42.78
HELLENIC REPUB         7.000  7/13/2020      EUR    64.87
HELLENIC REPUB         2.125   7/5/2013      CHF    72.33
HELLENIC REPUB         5.250   2/1/2016      JPY    74.79
HELLENIC REPUB         5.000  8/22/2016      JPY    69.86
HELLENIC REPUB         5.200  7/17/2034      EUR    57.62
HELLENIC REPUB         6.140  4/14/2028      EUR    67.27
HELLENIC REPUB         5.000  3/11/2019      EUR    70.02
HELLENIC REPUBLI       3.700  7/20/2015      EUR    72.46
HELLENIC REPUBLI       4.600  9/20/2040      EUR    49.73
HELLENIC REPUBLI       5.300  3/20/2026      EUR    59.08
HELLENIC REPUBLI       4.500  9/20/2037      EUR    49.73
HELLENIC REPUBLI       4.600  7/20/2018      EUR    68.51
HELLENIC REPUBLI       4.300  7/20/2017      EUR    68.51
HELLENIC REPUBLI       3.600  7/20/2016      EUR    71.19
HELLENIC REPUBLI       4.700  3/20/2024      EUR    58.39
HELLENIC REPUBLI       6.250  6/19/2020      EUR    74.72
HELLENIC REPUBLI       6.000  7/19/2019      EUR    72.02
NATIONAL BK GREE       3.875  10/7/2016      EUR    75.59
YIOULA GLASSWORK       9.000  12/1/2015      EUR    54.75
YIOULA GLASSWORK       9.000  12/1/2015      EUR    55.93

IRELAND
-------
ALLIED IRISH BKS       5.250  3/10/2025      GBP    63.43
DEPFA ACS BANK         5.125  3/16/2037      USD    70.56
DEPFA ACS BANK         4.900  8/24/2035      CAD    71.36
DEPFA ACS BANK         1.920   5/9/2020      JPY    70.93
DEPFA ACS BANK         0.500   3/3/2025      CAD    32.51
DEPFA ACS BANK         5.125  3/16/2037      USD    75.46
IRISH NATIONWIDE       6.250  6/26/2012      GBP   105.48
IRISH NATIONWIDE      13.000  8/12/2016      GBP    76.50
IRISH PERM PLC         7.284  2/15/2035      EUR    65.95
ONO FINANCE II         8.000  5/16/2014      EUR    73.63
ONO FINANCE II         8.000  5/16/2014      EUR    74.63
UT2 FUNDING PLC        5.321  6/30/2016      EUR    70.13

ITALY
-----
BANCA INTESA SPA       6.984   2/7/2035      EUR    73.13
CITY OF TURIN          5.270  6/26/2038      EUR    72.50
COMUNE DI MILANO       4.019  6/29/2035      EUR    74.96

LUXEMBOURG
----------
ARCELORMITTAL          7.250   4/1/2014      EUR    28.70
BREEZE FINANCE         4.524  4/19/2027      EUR    87.63
GLOBAL YATIRIM H       9.250  7/31/2012      USD    69.63
INTL INDUST BANK      11.000  2/19/2013      USD    51.38
LIGHTHOUSE INTL        8.000  4/30/2014      EUR    56.01
LIGHTHOUSE INTL        8.000  4/30/2014      EUR    56.90

NETHERLANDS
-----------
AI FINANCE B.V.       10.875  7/15/2012      USD    73.75
APP INTL FINANCE      11.750  10/1/2005      USD     0.05
ARPENI PR INVEST       8.750   5/3/2013      USD    50.00
ARPENI PR INVEST       8.750   5/3/2013      USD    50.00
BK NED GEMEENTEN       0.500  2/24/2025      CAD    51.94
BK NED GEMEENTEN       0.500  6/27/2018      CAD    74.69
BLT FINANCE BV         7.500  5/15/2014      USD    67.75
BLT FINANCE BV         7.500  5/15/2014      USD    67.88
BRIT INSURANCE         6.625  12/9/2030      GBP    61.88
DGS INTL FIN BV       10.000   6/1/2007      USD     0.01
ELEC DE CAR FIN        8.500  4/10/2018      USD    52.00
EM.TV FINANCE BV       5.250   5/8/2013      EUR     5.44
FRIESLAND BANK         4.125   1/8/2016      EUR    41.39
IVG FINANCE BV         1.750  3/29/2017      EUR    67.99
NATL INVESTER BK      25.983   5/7/2029      EUR    48.42
NED WATERSCHAPBK       0.500  3/11/2025      CAD    50.89
Q-CELLS INTERNAT       5.750  5/26/2014      EUR    65.01
Q-CELLS INTERNAT       1.375  2/28/2012      EUR    68.40
RBS NV EX-ABN NV       3.355  1/13/2020      USD    75.00
TEMIR CAPITAL          9.500  5/21/2014      USD    33.00
TJIWI KIMIA FIN       13.250   8/1/2001      USD     0.01
TURANALEM FIN BV       8.500  2/10/2015      USD    47.06
TURANALEM FIN BV       8.000  3/24/2014      USD    47.25
TURANALEM FIN BV       8.250  1/22/2037      USD    47.42
TURANALEM FIN BV       7.750  4/25/2013      USD    46.28
TURANALEM FIN BV       7.875   6/2/2010      USD    46.00

NORWAY
------
EKSPORTFINANS          0.500   5/9/2030      CAD    40.43
NORSKE SKOGIND         7.000  6/26/2017      EUR    64.64

POLAND
------
REP OF POLAND          3.300  6/16/2038      JPY    62.64
REP OF POLAND          2.648  3/29/2034      JPY    56.68
REP OF POLAND          3.220   8/4/2034      JPY    65.44

RUSSIA
------
ACBK-INVEST            9.500  4/14/2011      RUB     4.00
AGROKOM GROUP         10.000  6/21/2011      RUB     0.01
AIZK KEMEROVO          9.000  8/23/2011      RUB    21.01
APK ARKADA            17.500  5/23/2012      RUB     0.38
APK OGO               16.000   7/9/2010      RUB    50.50
ARKTEL-INVEST         12.000   4/9/2012      RUB     1.00
ATOMSTROYEXPORT-       7.750  5/24/2011      RUB     8.01
BALTINVESTBANK        11.000  4/26/2011      RUB    20.03
BANK OF MOSCOW         7.500   2/1/2013      RUB     3.10
BANK OF MOSCOW        10.640  7/29/2011      RUB     2.00
BANK ROSSIYA          14.500  7/21/2010      RUB     1.00
BANK SOYUZ             9.500  2/23/2011      RUB     5.00
BANK SOYUZ            16.000   5/2/2011      RUB     5.00
CB STROYCREDIT        14.000   8/1/2011      RUB    27.01
CENTERTELECOM          9.300  8/30/2011      RUB     2.91
CHTPZ                 10.000  4/21/2015      RUB     3.00
DALUR-FINANS          14.000   2/5/2013      RUB     5.00
DERZHAVA-FINANS       16.500  7/27/2010      RUB     0.02
DIPOS                  8.000  6/19/2012      RUB    15.43
DVTG-FINANS           14.500   8/3/2010      RUB    15.40
DVTG-FINANS           17.000  8/29/2013      RUB     4.00
DVTG-FINANS           14.500  7/18/2013      RUB    12.01
EESK                   8.740   4/5/2012      RUB    23.01
EMALIANS-FINANS       18.000   7/8/2011      RUB     3.00
ENERGOCENTRE          25.000  7/11/2010      RUB     1.88
ENERGOINVEST-200      11.000  7/21/2010      RUB     5.00
ENERGOSTROY-FINA      12.000  5/20/2011      RUB     4.01
EUROKOMMERZ           16.000  6/18/2010      RUB     1.53
EUROKOMMERZ           16.000  3/15/2011      RUB     0.01
FAR EASTERN GENE      10.500   3/8/2013      RUB    25.01
FINANCEBUSINESSG      12.500  6/22/2011      RUB     2.19
FORTUM OJSC            9.750   2/6/2013      RUB     4.01
GLOBEX BANK            9.250  2/16/2013      RUB     3.24
GLOBEX-FINANS          0.100  4/26/2011      RUB     5.00
GRACE DIAMOND         15.000   6/7/2012      RUB     0.01
GRADOSTROY-INVES      11.000   3/3/2011      RUB     4.00
HCF BANK               7.500  9/16/2010      RUB    15.01
IART                  17.000   8/4/2013      RUB     1.10
IAZS                  11.000  12/8/2010      RUB     4.01
INPROM                13.000  7/15/2010      RUB    42.00
INPROM                 9.500  5/18/2011      RUB    31.00
INTERGRAD             15.000   7/9/2014      RUB     4.00
IZHAVTO               18.000   6/9/2011      RUB    11.31
KARUSEL FINANS        12.000  9/12/2013      RUB     1.00
KOMOS GROUP           18.000  7/21/2011      RUB    23.01
KOSMOS-FINANS         10.200  6/16/2011      RUB    15.50
KRAYINVESTBANK        13.750   8/5/2011      RUB     4.00
KUBANSKAYA NIVA       15.500  2/20/2014      RUB     2.80
LEKSTROY               0.100  7/22/2011      RUB     7.01
LSR-INVEST            17.000  7/14/2011      RUB    26.01
M-INDUSTRIYA          16.000  7/10/2013      RUB    57.71
M-INDUSTRIYA          12.250  8/16/2011      RUB    40.11
M.O.R.E.-PLAZA        15.500   8/3/2010      RUB     4.00
MACROMIR-FINANS       10.000   7/3/2012      RUB     2.00
MAGNOLIYA             19.000  7/22/2010      RUB     6.00
MDM BANK               9.000   4/9/2015      RUB     7.01
METALLSERVIS-FIN      11.000  5/23/2012      RUB    19.51
METROSTROY INVES      10.500  9/23/2011      RUB     8.00
MIG-FINANS             0.100   9/6/2011      RUB     4.00
MIRAX                 14.990  5/17/2011      RUB    21.00
MIRAX                 17.000  9/17/2012      RUB    14.10
MORTON-RSO            12.000  2/28/2011      RUB     5.00
MOSKOMMERTSBANK        1.000  6/12/2013      RUB    15.50
MOSKOMMERTSBANK       12.000  2/15/2011      RUB     4.00
MOSMART FINANS         0.010  4/12/2012      RUB     5.20
MOSOBLGAZ             12.000  5/17/2011      RUB    72.50
MOSOBLTRUSTINVES      20.000  3/26/2011      RUB     6.99
MOSSELPROM FINAN      14.000  4/10/2014      RUB     3.00
MOTOROSTROITEL-F       0.100  7/15/2010      RUB     0.11
MRSK URALA             8.600  5/22/2012      RUB     2.02
MY BANK               15.000   8/7/2012      RUB    20.00
NATIONAL CAPITAL      12.500  5/20/2011      RUB     6.01
NATIONAL CAPITAL      13.000  9/25/2012      RUB     4.00
NATIONAL FACTORI      11.500   5/3/2011      RUB     5.00
NEW INVESTMENTS       14.000   7/7/2011      RUB     4.00
NOK                   15.500  9/22/2011      RUB    50.00
NOK                   17.000  8/26/2014      RUB     1.40
NOMOS-LEASING         12.000   7/8/2011      RUB     6.00
NOVOROSSIYSK          13.000  12/9/2011      RUB     4.01
NUTRINVESTHOLDIN      11.000  6/30/2014      RUB    20.04
OBYEDINEONNYE KO       3.000  5/16/2012      RUB     5.01
OBYEDINEONNYE KO      15.000  4/17/2013      RUB     6.00
OJSC FCB              11.000   8/7/2012      RUB     3.00
ORENBURG IZHK          9.240  2/21/2012      RUB     5.00
OSMO KAPITAL          10.200   3/7/2011      RUB     7.01
PEB LEASING           14.000  9/12/2014      RUB     5.00
PENSION FUND REA       5.000   5/7/2019      RUB     4.00
POLYPLAST             19.000  6/21/2011      RUB    50.00
PROM TECH             16.000  4/25/2011      RUB     2.00
PROMNESTESERVICE       9.500  12/5/2014      RUB     2.01
PROMTRACTOR-FINA      18.000  7/24/2013      RUB    68.51
PROTEK-FINANS         12.000  11/2/2011      RUB    19.01
PROTON-FINANCE         9.000  6/12/2012      RUB     0.01
RAF-LEASING           12.500  2/21/2012      RUB     4.00
RAIFFEISENBANK        13.500  12/3/2013      RUB     2.77
RAILTRANSAUTO         17.500  12/4/2013      RUB     4.00
RFA-INVEST            10.000  11/4/2011      RUB     5.00
RMK PARK PLAZA        10.000   1/8/2013      RUB    19.01
ROSSELKHOZBANK        11.500  9/27/2017      RUB    12.00
ROSSKAT-CAPITAL       18.000  7/21/2010      RUB     4.00
RUSSIAN STANDARD      14.750   9/9/2010      RUB    16.01
RUSSIAN STANDARD       7.800  9/20/2011      RUB    16.01
RVK-FINANS            19.000  7/21/2011      RUB    18.85
RYBINSKKABEL           0.010  2/28/2012      RUB     1.00
SATURN                10.000   6/6/2014      RUB     2.10
SATURN                11.000  9/20/2011      RUB     2.00
SENATOR               14.000  5/18/2012      RUB    18.01
SETL GROUP            11.700  5/15/2012      RUB    18.01
SEVKABEL-FINANS       10.500  3/27/2012      RUB    46.00
SIBACADEMINVEST       18.000  7/30/2010      RUB     5.00
SIBIRTELECOM           9.500   8/8/2013      RUB     2.81
SIBUR                  9.000  3/13/2015      RUB     1.00
SIBUR                  9.250  3/13/2015      RUB     4.00
SIBUR                 13.500  3/13/2015      RUB     4.00
SIBUR                 10.470  11/1/2012      RUB     6.00
SIBUR                  9.000  3/13/2015      RUB     1.00
SINERGIA              10.700  7/22/2010      RUB     2.19
SISTEMA-HALS           8.500   4/8/2014      RUB     6.00
SISTEMA-HALS           8.500  4/15/2014      RUB     5.00
SOUTHERN STOCK C      15.750  4/29/2014      RUB     2.00
TAIF-FINANS            8.420   9/9/2010      RUB     4.00
TALIO-PRINCEPS        16.000  5/17/2012      RUB     4.00
TECHNOSILA-INVES       7.000  5/26/2011      RUB    17.01
TERNA-FINANS           1.000  11/4/2011      RUB     1.00
TGK-1                  8.500  3/11/2014      RUB     2.40
TGK-4                  8.000  5/31/2012      RUB    17.01
TK FINANS             12.600   9/5/2011      RUB     6.00
TOP-KNIGA             20.000  12/9/2010      RUB    52.00
TRANSCREDITFACTO      12.000  6/11/2012      RUB     2.44
TRANSCREDITFACTO      12.000  11/1/2012      RUB     5.00
TRANSFIN-M            11.000  12/3/2015      RUB     4.01
TRANSFIN-M            10.750  8/10/2012      RUB     5.01
TRANSFIN-M            14.000  7/10/2014      RUB     5.00
TRANSFIN-M            11.000  12/3/2014      RUB     6.00
TRANSFIN-M            11.000  12/3/2014      RUB     6.01
TRANSFIN-M            11.000  12/3/2014      RUB     6.01
TRANSFIN-M            11.000  12/3/2014      RUB     6.01
TRANSFIN-M            11.000  12/3/2015      RUB     5.01
TRANSFIN-M            11.000  12/3/2015      RUB     6.01
TRANSFIN-M            11.000  12/3/2015      RUB     5.01
TRANSNEFT             11.750  10/1/2019      RUB     4.00
TVER VAGONOSTRO        7.000  6/12/2013      RUB     0.01
UNITAIL               12.000  6/22/2011      RUB    20.01
UNITED HEAVY MAC      13.000  8/30/2011      RUB    21.03
UNITED HEAVY MAC      13.000  5/31/2013      RUB     2.49
URALCHIMPLAST         12.750  1/21/2011      RUB     3.00
URALELEKTROMED         8.250  2/28/2012      RUB     3.00
URALSVYAZINFORM        7.500   4/2/2013      RUB     6.01
UTK                    7.800  5/30/2012      RUB     2.42
VKM-LEASING FINA       1.000  5/18/2011      RUB     4.01
VLADPROMBANK          12.000   3/8/2011      RUB     1.00
VMK-FINANCE           16.000  5/21/2014      RUB     5.00
XM STROYRESURS        10.000  7/12/2011      RUB    24.01
YUGFINSERVICE         15.250  5/20/2014      RUB     4.00
ZAO EUROPLAN          14.500  8/11/2011      RUB     2.00
ZAPSIBCOMBANK         11.000  9/15/2011      RUB     4.00
ZHELEZOBETON          12.000  5/27/2011      RUB     5.01
ZHILSOTSIPOTEKA-       9.000  7/26/2011      RUB     5.00
ZOLOTO SELIGDARA      16.500  5/29/2014      RUB    50.10
VSEO UVEROVA BK        5.100  5/29/2013      EUR     2.30

SPAIN
-----
AYT CEDULAS CAJA       3.750  6/30/2025      EUR    73.41
BANCAJA EMI SA         2.755  5/11/2037      JPY    31.43
CEDULAS TDA 6          3.875  5/23/2025      EUR    75.29
CEDULAS TDA A-6        4.250  4/10/2031      EUR    73.26
JUNTA LA MANCHA        3.875  1/31/2036      EUR    72.86

SWITZERLAND
-----------
UBS AG                13.300  5/23/2012      USD     3.95
UBS AG JERSEY          9.000   7/2/2010      USD    52.30
UBS AG JERSEY          9.000  7/19/2010      USD    52.15
UBS AG JERSEY          9.350  7/27/2010      USD    52.65
UBS AG JERSEY          9.000  8/13/2010      USD    56.90
UBS AG JERSEY          9.500  8/31/2010      USD    58.75
UBS AG JERSEY         13.900  1/31/2011      USD    35.33
UBS AG JERSEY         14.640  1/31/2011      USD    38.31
UBS AG JERSEY         16.170  1/31/2011      USD    13.06
UBS AG JERSEY         10.000  2/11/2011      USD    61.78
UBS AG JERSEY         15.250  2/11/2011      USD    11.64
UBS AG JERSEY         11.000  2/28/2011      USD    68.73
UBS AG JERSEY         12.800  2/28/2011      USD    34.67
UBS AG JERSEY         11.330  3/18/2011      USD    18.08
UBS AG JERSEY         11.400  3/18/2011      USD    25.67
UBS AG JERSEY         10.990  3/31/2011      USD    30.99
UBS AG JERSEY         16.160  3/31/2011      USD    43.29
UBS AG JERSEY         10.820  4/21/2011      USD    21.64
UBS AG JERSEY         11.030  4/21/2011      USD    20.79
UBS AG JERSEY         10.650  4/29/2011      USD    15.83
UBS AG JERSEY         10.500  6/16/2011      USD    72.54
UBS AG JERSEY         13.000  6/16/2011      USD    48.78
UBS AG JERSEY         10.360  8/19/2011      USD    51.89
UBS AG JERSEY         11.150  8/31/2011      USD    38.33
UBS AG JERSEY          9.350  9/21/2011      USD    66.32
UBS AG JERSEY          9.450  9/21/2011      USD    48.71
UBS AG JERSEY          3.220  7/31/2012      EUR    49.60

UNITED KINGDOM
--------------
BANK OF SCOTLAND       6.984   2/7/2035      EUR    72.31
BARCLAYS BK PLC        9.000  6/30/2011      USD    42.86
BARCLAYS BK PLC       10.950  5/23/2011      USD    59.50
BARCLAYS BK PLC       10.600  7/21/2011      USD    40.76
BARCLAYS BK PLC        7.610  6/30/2011      USD    53.33
BARCLAYS BK PLC       10.650  1/31/2012      USD    44.80
BARCLAYS BK PLC       10.350  1/23/2012      USD    23.10
BRADFORD&BIN BLD       5.500  1/15/2018      GBP    44.22
BRADFORD&BIN BLD       4.910   2/1/2047      EUR    55.76
BRADFORD&BIN PLC       7.625  2/16/2049      GBP    46.03
BRADFORD&BIN PLC       6.625  6/16/2023      GBP    44.27
BROADGATE FINANC       5.098   4/5/2033      GBP    72.29
EFG HELLAS PLC         5.400  11/2/2047      EUR    72.88
EFG HELLAS PLC         6.010   1/9/2036      EUR    57.88
EFG HELLAS PLC         4.375  2/11/2013      EUR    73.45
ENTERPRISE INNS        6.375  9/26/2031      GBP    75.33
HBOS PLC               4.500  3/18/2030      EUR    68.17
HBOS PLC               6.000  11/1/2033      USD    53.39
HBOS PLC               6.000  11/1/2033      USD    53.39
INEOS GRP HLDG         7.875  2/15/2016      EUR    72.25
INEOS GRP HLDG         7.875  2/15/2016      EUR    73.46
LBG CAPITAL NO.1       7.975  9/15/2024      GBP    75.10
LBG CAPITAL NO.1       7.375  3/12/2020      EUR    76.00
LBG CAPITAL NO.1       6.439  5/23/2020      EUR    72.13
LBG CAPITAL NO.2       6.385  5/12/2020      EUR    72.25
LBG CAPITAL NO.2       7.625  12/9/2019      GBP    76.18
NATL GRID GAS          1.771  3/30/2037      GBP    47.23
NORTHERN ROCK          5.750  2/28/2017      GBP    61.13
NORTHERN ROCK          4.574  1/13/2015      GBP    66.64
OJSC BANK NADRA        9.250  6/28/2010      USD    32.50
PIRAEUS GRP FIN        4.000  9/17/2012      EUR    71.12
PUNCH TAVERNS          6.468  4/15/2033      GBP    73.69
ROYAL BK SCOTLND      10.000  2/15/2045      USD    59.34
ROYAL BK SCOTLND       4.243  1/12/2046      EUR    70.77
TXU EASTERN FNDG       6.450  5/15/2005      USD     1.00
UNIQUE PUB FIN         6.464  3/30/2032      GBP    65.90
WESSEX WATER FIN       1.369  7/31/2057      GBP    23.49



                            *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Thursday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.

                            *********


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 -- Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA.  Joy A. Agravante, Valerie U. Pascual, Marites O.
Claro, Rousel Elaine T. Fernandez, Frauline S. Abangan and Peter
A. Chapman, Editors.

Copyright 2010.  All rights reserved.  ISSN 1529-2754.

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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                 * * * End of Transmission * * *