TCREUR_Public/100903.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

           Friday, September 3, 2010, Vol. 11, No. 174

                            Headlines



F I N L A N D

M-REAL OYI: Moody's Upgrades Corporate Family Rating to 'B3'


F R A N C E

ODDO ET COMPAGNIE: Fitch Affirms Individual Rating at 'D'


G E R M A N Y

TUI AG: To Discuss Travel Unit Stake Acquisition on Sept. 9


I R E L A N D

ALLIED IRISH: May Fail to Meet Sale Deadline for Zachodni Stake
BREITHORN ABS: Fitch Lowers Rating on Class B Notes to 'Dsf'
CULTURAL RESOURCES: High Court Approves Scheme of Arrangement
PHOENIX FUNDING: Moody's Cuts Ratings on Class B Notes to Low-B

* IRELAND: January-August Corporate Insolvencies Up 14%


I T A L Y

COMPAGNIA ITALPETROLI: Sawiris Makes EUR140MM Bid for A.S. Roma


K A Z A K H S T A N

BTA BANK: Completes US$16.7 Billion Debt Restructuring


L I T H U A N I A

UAB BITE: S&P Raises Long-Term Corporate Credit Ratings to 'CCC'


L U X E M B O U R G

ORCO PROPERTY: Posts EUR237.7 Million Profit in First Half 2010


N E T H E R L A N D S

HARBOURMASTER CLO: Fitch Withdraws 'BBsf' Rating on Two Notes


S L O V E N I A

VEGRAD D.D.: Chief Executive Officer Hilda Tovsak Steps Down


U K R A I N E

ALFA-BANK UKRAINE: S&P Gives Stable Outlook; Affirms 'CCC+' Rating
KREDOBANK PJSC: S&P Raises Counterparty Credit Rating to 'B-'


U N I T E D   K I N G D O M

BAR VASA: Business as Usual Despite Receivership
DEUTSCHE PFANDBRIEFBANK: Moody's Junks Ratings on Various Notes
EDSON DISTRIBUTION: Goes Into Liquidation
HARKERS DISTRIBUTION: Goes Into Administration
POLLY PECK: Kevin Hellard Wants to Question Nadir Over Bankruptcy

* UK: Distressed Deals Involving North East Businesses Rise
* UK: Conservatives Drop Plans for Business Insolvency Reform
* UK: Landlords to Get Profit Share Under CVA Created by PwC


X X X X X X X X

* BOOK REVIEW: The U.S. Healthcare Certificate of Need Sourcebook




                         *********



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F I N L A N D
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M-REAL OYI: Moody's Upgrades Corporate Family Rating to 'B3'
------------------------------------------------------------
Moody's Investors Service has upgraded the corporate family
rating, the probability of default rating, the unsecured notes
rating of M-real Oyi to B3 from Caa1 and the senior unsecured
medium-term note program rating to (P)B3 from (P)Caa1.  Moreover,
the rating of the senior unsecured guaranteed MTN program of its
majority-owned subsidiary Metsa Group Financial Services Oyi is
upgraded to (P)B3 from (P)Caa1.  The rating outlook has been
changed to positive.

                        Ratings Rationale

The upgrade of M-real's ratings reflects continuing improvements
in the company's profitability and cash-flow generation,
benefiting in particular from positive market developments in
terms of pricing and delivery volumes in its principal business
lines.  As a result credit metrics have improved, including a
return of retained cash flow-to-debt to 3.9% in the last twelve
months ending June 2010 from negative levels recorded in 2009,
which now meets the rating agency's requirements for the lower end
of the single-B rating category.  Moody's anticipates that M-real
preserves its improved liquidity cushion and will proactively
address upcoming debt maturities.

The positive outlook reflects the likelihood that M-real's future
performance and credit metrics could be further strengthened by
measures implemented by the company and provided that the recovery
in market conditions is sustainable.

Further upward rating pressure could develop over the next 6 to 12
months if the company proactively addresses its refinancing
challenges and continues to record improving financial metrics,
reflected in positive free cash flows, an RCF-to-debt ratio rising
towards high single-digit percentages and its debt-to-EBITDA ratio
improving towards 5.5x.

However, the rating could come under negative pressure if debt-to-
EBITDA exceeds 7x, if RCF-to-debt falls back towards 2.5% or if
negative free cash flow generation weakens its liquidity position.
Another factor that could add negative pressure on the ratings
would be the inability to timely refinance any upcoming debt
maturities.

M-real's pulp and energy business area continues to benefit from
recent pulp price inflation.  The operating performances of M-
real's consumer packaging, office paper and specialty paper
business areas are currently benefiting from a recovery in
deliveries and gradually rising product prices, which it needs to
offset a rise in input costs.  While consumer packaging continues
to be the most significant profitability contributor, a continued
turnaround of the office paper and specialty paper business areas
is needed to elevate M-real's operating performance and cash
generation, before further positive rating pressure builds up.

Additional price increases have been announced, which, together
with ongoing realization of cost structure adjustments, should
support a further improvement in the company's performance and
cash generation.  However, Moody's warns that the current recovery
of paper and packaging markets in Europe is to some extent a
result of restocking activities and that a sustainable recovery in
demand is required to preserve the recently improved supply-demand
balances in the industry, as a basis for a sustainable rebuild of
pricing power.

Provided that the company continues to generate a break-even free
cash flow generation and following its recent asset disposals, M-
real's liquidity profile is currently sufficient to cover debt
maturities until 2012.  As at end-Q2 2010, M-real had access to
EUR366 million of cash, interest-bearing receivables (almost fully
from other Mets„liitto companies) of EUR126 million and undrawn
pension loans of EUR144 million.  These sources are sufficient to
address debt maturities of EUR96 million and EUR160 million in
2011 and 2012, respectively.  However, the company relies on
external refinancing sources to partially cover the EUR500 million
bond maturing in 2013.  Moody's expects that M-real will address
upcoming debt maturities on a timely basis.

Upgrades:

Issuer: M-real Oyj

  -- Probability of Default Rating, Upgraded to B3 from Caa1

  -- Corporate Family Rating, Upgraded to B3 from Caa1

  -- Senior Unsecured Medium-Term Note Program, Upgraded to (P)B3,
     LGD4, 52% from (P)Caa1, LGD4, 56%

  -- Senior Unsecured Regular Bond/Debenture, Upgraded to B3,
     LGD4, 52% from Caa1, LGD4, 56%

Issuer: Metsa Group Financial Services Oy

  -- Senior Unsecured Medium-Term Note Program, Upgraded to (P)B3,
     LGD4, 52% from (P)Caa1, LGD4, 56%

Outlook Actions:

Issuer: M-real Oyj

  -- Outlook, Changed To Positive From Stable

Issuer: Metsa Group Financial Services Oy

  -- Outlook, Changed To Positive From Stable

The most recent rating action was on February 24, 2010, when
Moody's changed the outlook on the ratings to stable from
negative.

M-real, with headquarters in Espoo, Finland, is among Europe's
largest integrated paper and forest products companies with sales
of EUR2.4 billion per the last 12 months ending December 31, 2009.
Core activities include consumer packaging, office papers and
specialty papers.

                     Regulatory Disclosures

Information sources used to prepare the credit rating are these:
parties involved in the ratings, public information.

Moody's Investors Service considers the quality of information
available on the issuer or obligation satisfactory for the
purposes of maintaining a credit rating.

The rating has been disclosed to the rated entity or its
designated agents and issued with no amendment resulting from that
disclosure.

Moody's Investors Service adopts all necessary measures so that
the information it uses in assigning a credit rating is of
sufficient quality and from reliable sources; however, Moody's
Investors Service does not and cannot in every instance
independently verify, audit or validate information received in
the rating process.


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F R A N C E
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ODDO ET COMPAGNIE: Fitch Affirms Individual Rating at 'D'
---------------------------------------------------------
Fitch Ratings has affirmed Oddo et Compagnie's Long-term Issuer
Default Rating at 'BBB+' with a Stable Outlook.  Fitch has also
affirmed Oddo's Short-term IDR at 'F2', Individual Rating at 'C',
Support Rating at '5' and Support Rating Floor at 'No Floor'.  At
the same time, the agency has maintained Banque d'Orsay's Long-
term Issuer Default Rating of 'BBB+', Short-term IDR of 'F2' and
Support Rating of '2' on Rating Watch Negative, whilst affirming
its Individual Rating at 'D'.  A full rating breakdown is provided
at the end of this comment.

The rating action follows the announcement under which Oddo will
acquire BO from Germany-based WestLB AG ('A-'/'F1'/RWN) by end-
2010.  The acquisition will help Oddo grow its asset management
business line through EUR2.5 billion of additional assets under
management, equivalent to at least two years of organic growth.
Although the transaction's financial details have not been made
public, Fitch understands that there it will have no significant
impact on Oddo's profitability or capitalization.  The agency also
understands that Oddo's risk profile will not be significantly
increased by the acquisition, and that Oddo intends to transfer
the risks associated with BO's arbitrage business to third parties
as soon as possible.

The RWN on BO's ratings is expected to be resolved when BO is
formally acquired by Oddo and Oddo takes the necessary measures to
integrate the bank, which is likely to occur around year end 2010.
If this occurs as planned, BO's ratings would be affirmed, but if
the transaction fails to complete, the ratings will remain at risk
of downgrade.

Oddo, which has bank status, is the sole independent investment
firm in France.  It operates in corporate and investment banking,
including brokerage, market making in options, commodities trading
and corporate finance advisory.  Oddo also runs asset management
activities and has over EUR17 billion of assets under management.
Its ratings reflect its solid capital ratios and liquidity, good
performance over the cycle and low risk appetite.  They also take
into account its small size and limited franchise in brokerage and
asset management in Europe.

BO is a niche bank operating in arbitrage, asset management and
private banking.  It has nearly EUR2.5 billion of assets under
management.  BO's IDRs are based on the support available from its
parent, WestLB AG, and underpinned by a public 'backing'
declaration ("Patronatserklaerung").  The RWN on BO's IDRs
reflects the RWN placed on its parent's IDRs.  Fitch expects
support to be forthcoming as long as WestLB remains the owner of
BO.  BO's Individual Rating reflects the bank's modest franchise,
small size, weak funding profile and high leverage.

The rating actions are:

Oddo et Compagnie

  -- Long-term IDR: affirmed at 'BBB+'; Stable Outlook
  -- Short-term IDR: affirmed at 'F2'
  -- Individual Rating: affirmed at 'C'
  -- Support Rating: affirmed at '5'
  -- Support Rating Floor: affirmed at 'No Floor'
  -- Senior Unsecured debt: affirmed at 'BBB+'
  -- Subordinated debt: affirmed at 'BBB'
  -- Commercial paper: affirmed at 'F2'

Banque d'Orsay

  -- Long-term IDR: 'BBB+'; maintained on RWN
  -- Short-term IDR: 'F2'; maintained on RWN
  -- Individual Rating: affirmed at 'D'
  -- Support Rating: '2'; maintained on RWN
  -- Senior Unsecured debt: 'BBB+'; maintained on RWN
  -- Certificate of Deposit: 'F2'; maintained on RWN

In Fitch's rating criteria, a bank's standalone risk is reflected
in Fitch's Individual ratings and the prospect of external support
is reflected in Fitch's Support ratings.  Collectively these
ratings drive Fitch's Long- and Short-term IDRs.


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


TUI AG: To Discuss Travel Unit Stake Acquisition on Sept. 9
-----------------------------------------------------------
Paul Jarvis and Armorel Kenna at Bloomberg News, citing Financial
Times Deutschland, report that TUI AG is weighing the purchase of
the shares it doesn't already own in TUI Travel Plc.

According to Bloomberg, FTD said TUI Travel is on the agenda for a
Sept. 9 board meeting of TUI, where directors of the German
company will also discuss options for the possible sale of TUI's
stake in the Hapag-Lloyd container line.

TUI owns about 55% of the Crawley, England-based travel company,
Bloomberg notes.

"TUI would have to pay a significant premium if it were to acquire
the minority," Bloomberg quoted Nick Batram, a KBC Peel Hunt
analyst in London, as saying.

As reported by the Troubled Company Reporter-Europe on July 22,
2010, Jamie Rollo, an analyst at Morgan Stanley, as cited by
Bloomberg News, said TUI AG could justify a deal through hard cost
savings, utilization of tax losses, and access to Tui Travel's
significant cash flow.

TUI AG -- http://www.tui-group.com/en/-- is a Germany-based
company mainly engaged in the tourism sector, focusing on the
markets of Central, Northern and Western Europe.  TUI owns a
network of travel agencies and tour operators, including air
tours, Thomson, First Choice and TUI Deutschland.  It also
operates several airlines, including Corsairfly, Thomsonfly and
First Choice Airways, among others.  The Company is structured
into three segments: TUI Travel, TUI Hotels and Resorts, and
Cruises.  TUI Travel comprises the Company's distribution, tour
operating, airline and incoming activities and services over 30
million customers in 180 countries.  The TUI Hotels and Resorts
division offers a portfolio of 238 hotels, located in Spain,
Greece, Egypt, France, Turkey, Tunisia, the Balearics and the
Caribbean, among others.  The Cruises sector comprises Hapag-Lloyd
Kreuzfahrten GmbH and TUI Cruises which provide luxury cruises,
and cruises within the German-speaking countries, respectively.

                           *     *     *

As reported by the Troubled Company Reporter-Europe on Aug. 3,
2010, Standard & Poor's Ratings Services said that it affirmed its
'B-' long-term corporate credit rating on Germany-based tourism
and shipping conglomerate TUI AG and removed it from CreditWatch,
where it was originally placed with negative implications on July
29, 2009.  S&P said the outlook is negative.  At the same time,
the issue ratings of 'CCC+' on the senior unsecured debt, and of
'CCC-' on the junior subordinated debt, were affirmed and removed
from CreditWatch negative.


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I R E L A N D
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ALLIED IRISH: May Fail to Meet Sale Deadline for Zachodni Stake
---------------------------------------------------------------
Geoff Percival at Irish Examiner reports that AIB is unlikely to
be able to wrap up the sale of its 70% stake in Bank Zachodni in
Poland by the end of this month and could even be facing a huge
challenge to conclude a deal before the end of the year.

According to Irish Examiner, a source familiar with the workings
of the Polish banking and regulatory systems said "both AIB and
foreign bidders are underestimating the process of getting a deal
done and the ability to meet the year-end deadline set down by the
regulator in Ireland".  The same source suggested that it would be
near impossible for a deal to be concluded by the end of September
and highly unlikely that a deal could be finalized by the end of
December, meaning that AIB would have to tap the state for further
capital, Irish Examiner relates.

It has been speculated that Poland's government wants a domestic
buyer for Zachodni, in a bid to lessen foreign ownership levels in
its banking system, Irish Examiner notes.

Irish Examiner says acquiring more than 66% of a Polish company
requires a compulsory tender offer for 100% of the company.
According to Irish Examiner, the source said: "It's highly
unlikely anyone will announce a tender offer for 100% of Zachodni,
as they're likely to be obliged to sell down back towards a 70%
level and may incur losses doing so."

As reported by the Troubled Company Reporter-Europe, Bloomberg
said Allied Irish is selling the stake in Zachodni as it seeks to
raise EUR7.4 billion (US$9.4 billion) to reach new capital
standards.

Allied Irish Banks, p.l.c., together with its subsidiaries --
http://www.aibgroup.com/-- conducts retail and commercial banking
business in Ireland.  It also provides corporate lending and
capital markets activities from its head office at Bankcentre and
from Dublin's International Financial Services Centre.  The Group
also has overseas branches in the United States, Germany, France
and Australia, among other locations.  The business of AIB Group
is conducted through four operating divisions: AIB Bank Republic
of Ireland division, Capital Markets division, AIB Bank UK
division, and Central & Eastern Europe division.  In February
2008, the Group acquired the AmCredit mortgage business in the
Baltic states of Latvia, Lithuania and Estonia.  In September
2008, the Group also acquired a 49.99% shareholding in BACB.

                           *     *     *

As reported by the Troubled Company Reporter-Europe on July 23,
2010, Moody's Investors Service affirmed AIB's long-term bank
deposit and debt ratings.  These are A1 for long-term bank
deposits and senior debt, A2 for dated subordinated debt, Ba3 for
undated subordinated debt, B1 for cumulative tier 1 securities and
Caa1 for non-cumulative tier 1 securities.  Moody's said the
outlook on these ratings is stable.  AIB's bank financial strength
rating of D, which maps to Ba2 on the long term rating scale, with
a positive outlook was unaffected by the rating action.


BREITHORN ABS: Fitch Lowers Rating on Class B Notes to 'Dsf'
------------------------------------------------------------
Fitch Ratings has downgraded Breithorn ABS Funding, p.l.c's notes:

  -- EUR 1,000,000 class A-2 notes to 'Csf' from 'CCsf';
  -- EUR 62,500,000 class B notes to 'Dsf' from 'CCsf'.

The rating downgrades reflect the depletion of credit enhancement
and partial default in the payment of interest to class B.  This
has occurred as a result of credit events in the reference
portfolio.

Breithorn entered an Event of Default on July 26, 2010 as a result
of the partial default in the payment of interest to the class B
notes.  The default was the result of protection payments due to
the credit default swap counterparty from three credit events that
occurred in July 2010.  Class B is non-deferrable and accordingly,
has been downgraded to 'D'.

Credit enhancement for classes A-2 and B is structured in the form
of subordination through threshold levels.  These threshold levels
have been reduced to zero.  Therefore, the class A-2 notes have
been downgraded to 'Csf' to reflect Fitch's opinion that default
is inevitable.

Breithorn is a synthetic structured finance collateralized debt
obligation that closed on July 2, 2003 with Swiss Re Financial
Products Corporation as the swap counterparty.  The portfolio is
composed of commercial mortgage-backed securities (36.7%),
residential mortgage-backed securities (32.7%), corporate CDOs
(19.1%) and consumer asset-backed securities (11.5%).


CULTURAL RESOURCES: High Court Approves Scheme of Arrangement
-------------------------------------------------------------
Aodhan O'Faolain at The Irish Times reports that the High Court
approved a scheme of arrangement with Cultural Resources
Development Services Ltd.'s creditors.

The report says the court's decision preserved 11 jobs at the
company.

The court was informed the firm has changed its business model and
will focus on teaching archaeology to students, the report
discloses.

According to the report, Mr. Justice Peter Charleton said he was
satisfied to confirm a scheme of arrangement allowing CRDS to come
out of examinership and continue to trade as a going concern.

The report notes, Ross O'Gorman, for the company, said under the
scheme most creditors will receive between 10 and 15% of what they
are owed.

Earlier this year, the company sought court protection after it
became insolvent, the report relates.  It got into financial
difficulties when the economic downturn affected large scale road
projects, the report discloses.

As of April 30, the company had a deficit of EUR895,000, the
report says.  On a liquidation basis that deficit would rise to at
least EUR1.15 million, the report states.

Cultural Resources Development Services Ltd. is an archaeological
and historical consultation service provider.


PHOENIX FUNDING: Moody's Cuts Ratings on Class B Notes to Low-B
---------------------------------------------------------------
Moody's Investors Service downgraded the ratings of all notes
issued by Phoenix Funding 2 Limited and Phoenix Funding 3 Limited.

Issuer: Phoenix Funding 2 Limited

  -- EUR7125M A Notes, Downgraded to Aa2 (sf); previously on Jul
     23, 2010 Aaa (sf) Placed Under Review for Possible Downgrade

  -- EUR375M B Notes, Downgraded to B1 (sf); previously on Jul 22,
     2009 A1 (sf) Placed Under Review for Possible Downgrade

Issuer: Phoenix Funding 3 Limited (Phoenix 3)

  -- EUR3040M A Notes, Downgraded to Aa1 (sf); previously on Jul
     23, 2010 Aaa (sf) Placed Under Review for Possible Downgrade

  -- EUR160M B Notes, Downgraded to Ba2 (sf); previously on Jul
     23, 2010 A1 (sf) Placed Under Review for Possible Downgrade

                         Rating Rationale

The rating action concludes the review and takes into
consideration the worse-than-expected performance of the
collateral and the weakened macro-economic environment in Ireland,
including the expected increase in unemployment rates projected
for 2010 as well as further deterioration of the Irish housing
market.

The ratings of the notes takes into account the credit quality of
the underlying mortgage loan pool, from which Moody's determined
the MILAN Aaa Credit Enhancement and the lifetime losses (expected
loss), as well as the transaction structure and any legal
considerations as assessed in Moody's cash flow analysis.  The
expected loss and the Milan Aaa CE are the two key parameters used
by Moody's to calibrate its loss distribution curve, used in the
cash-flow model to rate European RMBS transactions.

Portfolios expected loss: Moody's has reassessed its lifetime loss
expectation for the pool of Phoenix 2 and 3 taking into account
the collateral performance to date as well as the current
macroeconomic environment in Ireland.  Phoenix 2 and 3 are
performing worse than Moody's expectations as of closing.  The
collateral performance in both deals has deteriorated rapidly over
the past 12 months.  The share of loans more than 90 days in
arrears have doubled since June 2009, from 2.6% and 2.2% of
current pool balance in June 2009 to 5.2% and 4.5% in June 2010
for Phoenix 2 and 3 respectively.  As at June 2010, the share of
360d+ delinquent loans represent 1.3% and 1.05% of current pool
balance in Phoenix 2 and 3 respectively.  Phoenix 2 and 3 have
experienced limited repossession to-date, currently representing
9bps and 2bps of pool balance in both deals respectively.  The
negligible level of repossessions to-date in the Irish mortgage
market is associated to the lengthy foreclosure process in Ireland
as well as to the moratorium on legal proceedings introduced by
the Irish government in February 2009.  Moody's does not expect
the arrears level in these transactions to stabilize before 2011.
Moody's believes the weakening of the Irish economic conditions
and in particular the effects that the anticipated tightening of
fiscal policy, on the back of government austerity, is likely to
have on the recovery in the Irish labor market and on the
household finances.  On the basis of the rapid deterioration in
arrears in the transactions and Moody's negative sector outlook
for Irish RMBS, Moody's have updated the portfolio expected loss
assumption to 3.15% of original pool balance in Phoenix 2 and 2.7%
of original balance in Phoenix 3, up from 0.75% and 1%
respectively at closing.

MILAN Aaa CE: Moody's has assessed the loan-by-loan information
for the outstanding portfolios to determine the MILAN Aaa CE.
Moody's has increased its MILAN Aaa CE assumptions to 18% for
Phoenix 2 and 15% for Phoenix 3, up from 9.4% and 7.6%
respectively at closing.  The increase in the MILAN Aaa CE for
each pool reflect their relatively high current loan-to value
(LTV) , with non-indexed LTV currently standing at 72% for Phoenix
2 and 66% for Phoenix 3 and indexed LTV currently standing at
97.3% and 80.2% respectively in both transactions.  Irish house
prices have fallen by more than 35% below the peak reached in late
2006.  As a result, indexed LTV on the pool has significantly
increased, with respectively 55% and 38% of the Phoenix 2 and 3
portfolios currently in negative equity.

The ratings address the expected loss posed to investors by the
legal final maturity of the notes.  In Moody's opinion, the
structure allow for timely payment of interest and principal with
respect of the notes by the legal final maturity.  Moody's ratings
only address the credit risk associated with the transaction.
Other non-credit risks have not been addressed, but may have a
significant effect on yield to investors.

Phoenix 2 and Phoenix 3 closed in June 2008 and November 2008
respectively.  Both transactions are backed by a pool of first-
ranking mortgage loans originated by IIB Homeloans Limited, now
KBC Bank Ireland PLC (Baa2/P2), secured on residential properties
located in Ireland.  For details on the deals structure, please
refer to the "Phoenix Funding 2 Limited" and "Phoenix Funding 3
Limited" new issue reports available on www.moodys.com.  Both
deals have similar structure; below are some key features that
have changed since closing of the deals:

Liquidity facility: Following the downgrade of KBC Bank Ireland
PLC from A2/P-1 to Baa2/P-2 in April 2009, Phoenix 2 and 3 have
each entered into liquidity facility agreements with KBC Bank
Ireland PLC in an amount up to 3.4% of the outstanding notes
balance.  KBC Bank N.V.  (Aa3/P1) acts as the guarantor of KBC
Bank Ireland PLC obligations as liquidity facility provider in
both deals.

Hedging agreement: The transactions benefit from interest rate
swaps provided by KBC Bank Ireland PLC.  Since the downgrade of
KBC Bank Ireland PLC to Baa2/P-2 in April 2009, KBC Bank N.V.
(Aa3/P1) guarantees the obligations of KBC Bank Ireland PLC under
the swap agreements.

Transaction Bank Account: The transaction accounts in Phoenix 2
and 3 are held with KBC Bank Ireland PLC.  Following the downgrade
of KBC Bank Ireland PLC, KBC Bank N.V. (Aa3/P1) was appointed as
guarantor of KBC Bank Ireland PLC obligations as transaction
account bank.

Reserve fund: The reserve funds are currently at target level,
representing 4% of current pool balance in both transactions.  The
reserve funds could amortize from July 2010 for Phoenix 2 and
December 2010 for Phoenix 3, if certain conditions are met.
Moody's notes that the arrears levels in Phoenix 2 and 3 are
currently exceeding the minimum thresholds to allow amortization
of the reserve funds.  The 30d+ and 90d+ arrears levels are set
respectively at 6% and 3% of current pool balance in both deals.
Moody's does not expect amortization of the reserve funds before
final maturity of the deals.

Moody's Investors Service did not receive or take into account a
third party due diligence report on the underlying assets or
financial instruments related to the monitoring of these
transactions in the past 6 months.

                     Regulatory Disclosures

The ratings have been disclosed to the rated entity or its
designated agents and issued with no amendment resulting from that
disclosure.

Information sources used to prepare the credit ratings are these:
parties involved in the ratings, parties not involved in the
ratings, public information, confidential and proprietary Moody's
Investors Service information.

Moody's Investors Service may have provided Ancillary or Other
Permissible Service(s) to the rated entity or its related third
parties within the three years preceding the Credit Rating Action.
Please see the ratings disclosure page www.moodys.com/disclosures
on Moody's website for further information.

Moody's Investors Service considers the quality of information
available on the issuers or obligation satisfactory for the
purpose of maintaining a credit rating.

Moody's Investors Service adopts all necessary measures so that
the information it uses in assigning a credit rating is of
sufficient quality and from reliable sources; however, Moody's
Investors Service does not and cannot in every instance
independently verify, audit or validate information received in
the rating process.


* IRELAND: January-August Corporate Insolvencies Up 14%
-------------------------------------------------------
Charlie Taylor at The Irish Times, citing data compiled by
accountancy firm Kavanagh Fennell, reports that more than 1,000
Irish companies have gone out of business so far this year.

According to the report, new figures show that 1,012 companies
collapsed between January and August, an increase of 14% on the
same period last year.

The report says the number of insolvencies dropped dramatically in
August, falling from 125 in July to 95 in August.  This is the
lowest monthly total for insolvencies so far this year and the
lowest since January 2009, the report notes.

According to the report, Kavanagh Fennell, which publishes
InsolvencyJournal.ie, said that while the number of insolvencies
recorded in August fell, an increase is expected again before the
year ends.

"The decrease could be due to a traditional seasonal slowdown in
August and insolvencies are likely to increase again in the final
quarter of 2010 in line with the 2009 trend.  Based on our
analysis we expect the last quarter to show a substantial increase
in the number of insolvencies," the report quoted Ken Fennell,
partner with Kavanagh Fennell, as saying.

The figures show that 309 construction firms collapsed in the
first eight months of the year but the rate of failure in the
sector appears to be slowing down, the report relates.

So far this year, examiners have been appointed to nine companies,
compared to 24 in 2009 and 18 in 2008, the report notes.

According to the report, receivers were appointed to 12 companies
in August, bringing the total number of Irish firms now in
receivership to 155.  This represents a 94% increase on the same
period last year and is up 400 per cent on 2008 figures, the
report states.


=========
I T A L Y
=========


COMPAGNIA ITALPETROLI: Sawiris Makes EUR140MM Bid for A.S. Roma
---------------------------------------------------------------
Armorel Kenna at Bloomberg News, citing daily Il Sole 24 Ore,
reports that Naguib Sawiris, chairman of mobile-phone operator
Orascom Telecom Holding SAE, offered EUR140 million (US$178
million) to buy control of Italian soccer club A.S. Roma SpA.

According to Bloomberg, the Italian newspaper said the Sawiris
family's offer is higher than the EUR100 million bid being
prepared by a group led by Italian businessman Francesco Angelini.

Bloomberg notes the Italian newspaper said Rothschild, the adviser
on the sale of A.S. Roma, has contacted potential investors in
Italy and abroad for a possible sale by December.

As reported by the Troubled Company Reporter-Europe on Aug. 18,
2010, the Financial Times said Italian private equity firm
Clessidra would jointly bid with lender UniCredit and Angelini, a
pharmaceuticals company to acquire AS Roma, one of the country's
top Serie A football clubs, owned by the Sensi family through
Italpetroli.  With equal shares, the three investors could take up
to 67% of the football team, according to the FT.  The FT noted
analysts said that, before the global financial crisis, Roma could
have been expected to fetch possibly double its current market
value of some EUR150 million.

On July 12, 2010, the Troubled Company Reporter-Europe, citing the
FT, reported that UniCredit was looking for a new owner to acquire
AS Roma following an agreement reached on July 8 with Rosella
Sensi to settle debts owed to the bank by Italpetroli, her near-
bankrupt family holding company.  Ms. Sensi, whose family has held
a majority stake in Roma since 1993 until July 8 amounting to 67%,
was struggling to repay Italpetroli's debts, with some EUR320
million owed to UniCredit and EUR80 million to Monte dei Paschi di
Siena, according to the FT.  In the meantime, Ms. Sensi would
remain part of the management team to ensure continuity for the
club in the build-up to the new season, the FT disclosed.

Headquartered in Rome, Italy, Compagnia Italpetroli SpA operates
as an oil storage company.  The company also offers petroleum
refining services.


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


BTA BANK: Completes US$16.7 Billion Debt Restructuring
------------------------------------------------------
BTA Bank said it completed restructuring of US$16.7 billion of
debt, Nariman Gizitdinov at Bloomberg News reports, citing the
Specialized Financial Court of Almaty's Tuesday ruling.

Bloomberg relates the bank said in an e-mailed statement on
Wednesday that following the restructuring, BTA's indebtedness
fell to US$4.2 billion and its maximum maturity was extended to 20
years from eight.  According to Bloomberg, the statement said BTA
distributed US$945 million in cash to creditors and new debt
securities including US$5.2 billion of recovery units and US$2.3
billion of senior notes.

Bloomberg notes BTA Chief Executive Officer Anvar Saidenov said
the bank will pay US$350 million of interest to creditors this
year, and an annual US$680 million in 2011 and 2012.

BTA's creditors own 18.5% of shares after the restructuring, while
minority shareholders own 0.02%, Bloomberg states.

                          About BTA Bank

BTA Bank AO (BTA Bank JSC), formerly Bank TuranAlem AO --
http://bta.kz/-- is a Kazakhstan-based financial institution,
which is involved in the provision of banking and financial
products for private and corporate clients.

The BTA Group is one of the leading banking groups in the
Commonwealth of Independent States and has affiliated banks in
Russia, Ukraine, Belarus, Georgia, Armenia, Kyrgyzstan and Turkey.
In addition, the Bank maintains representative offices in Russia,
Ukraine, China, the United Arab Emirates and the United Kingdom.
The Bank has no branch or agency in the United States, and its
primary assets in the United States consist of balances in
accounts with correspondent banks in New York City.

As of November 30, 2009, the Bank employed 5,043 people inside
and 4 people outside Kazakhstan.  It has no employees in the
United States.  Most of the Bank's assets, and nearly all its
tangible assets, are located in Kazakhstan.

JSC BTA Bank, also known as BTA Bank of Kazakhstan, filed for
Chapter 15 bankruptcy protection in New York on Feb. 4, 2010
(Bankr. S.D.N.Y. Case No. 10-10638), listing more than US$1
billion in both assets and debt.

On March 9, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported that JSC BTA Bank was granted relief in
the U.S. under Chapter 15 when the bankruptcy judge in New York
ruled t that the court in Kazakhstan abroad is home to the
"foreign main proceeding."  Consequently, creditor actions in the
U.S. were permanently halted, forcing creditors to hash out their
claims and receive distributions in Kazakhstan, according to
Bloomberg.

BTA Bank is represented in the Chapter 15 proceedings by White &
Case LLP.


=================
L I T H U A N I A
=================


UAB BITE: S&P Raises Long-Term Corporate Credit Ratings to 'CCC'
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it raised its long-
term corporate credit ratings on Lithuania-headquartered mobile
telecommunications operator UAB Bite Lietuva and its 100% owner
Bite Finance International B.V. to 'CCC' from 'CCC-'.  The outlook
is stable.

At the same time, S&P raised the rating on Bite Finance
International's outstanding subordinated notes to 'CCC-' from 'CC'
and the rating on the group's ?190 million senior secured notes to
'CCC' from 'CCC-'.

"The upgrades reflect S&P's view that the risk of an immediate
covenant breach has receded following an amendment to Bite's
maintenance financial covenants earlier in 2010," said Standard &
Poor's credit analyst Michael O'Brien.  S&P also view as
encouraging year-on-year EBITDA growth of 39.8% in the first half
of 2010 and a reduction of losses in Bite's Latvian subsidiary.
In addition, through tight cost control and reduced capital
expenditure, Bite has managed to limit cash burn by generating
positive free operating cash flow of ?6.9 million in the first
half of 2010.

In S&P's view, the reduction in immediate covenant pressures and
the improvement in cash flow generation have both contributed to a
possible stabilization of Bite's credit profile over the near
term.  In addition, the group may achieve deleveraging through
incremental EBITDA growth in the near term, which could also
support financial flexibility and covenant headroom.

At the same time, S&P believes that significant risks to liquidity
and potential future pressures on covenant headroom remain over
the longer term.  A negative rating action could result from
operating underperformance contributing to renewed liquidity
pressures and a reduction of covenant headroom, and/or external
factors such as increased macroeconomic or currency pressures.

Better-than-anticipated EBITDA growth in Lithuania and clear
progress in Latvia that contribute to higher-than-projected FOCF
could lend upside to the rating.


===================
L U X E M B O U R G
===================


ORCO PROPERTY: Posts EUR237.7 Million Profit in First Half 2010
---------------------------------------------------------------
Pawel Kozlowski and Krystof Chamonikolas at Bloomberg News report
that Orco Property Group SA, which is overhauling its business
under a court-approved plan, posted first-half profit, helped by
debt revaluation and an asset sale.

Bloomberg relates the company said late Tuesday net income for six
months ended June 30 was EUR237.7 million (US$302 million),
compared with a EUR199.9 million loss a year earlier.  Bloomberg
notes the company statement said Orco recorded a one-time gain of
EUR270 million after it rescheduled existing bonds.

According to Bloomberg, the company said revenue jumped 23% to
EUR163 million, helped by a sale of commercial developments in
Germany.

As reported by the Troubled Company Reporter-Europe, on May 19,
Reuters' Jason Hovet said that a Paris court had approved a plan
exiting Orco from its more than year-long creditor protection
period.  Reuters disclosed Orco said the plan includes the
repayment of 100% of the company's admitted claims over 10 years.
The court protection in place since March last year had protected
EUR1.5 billion (US$1.9 billion) in bank debts and bonds, according
to Reuters.  Reuters said Orco proposed a 10 year rescheduling
plan to restructure more than EUR400 million in debt held by
bondholders through a scheme that looks to extend the average
maturity of its bonds to eight years from three.

Orco Property Group SA -- http://www.orcogroup.com/-- is a
Luxembourg-based real estate company, specializing in the
development, rental and management of properties in Central and
Eastern Europe.  Through its fully consolidated subsidiaries, Orco
Property Group SA operates in several countries, including the
Czech Republic, Slovakia, Germany, Hungary, Poland, Croatia and
Russia.  The Company rents and manages real estate and hotels
properties composed of office buildings, apartments with services,
luxury hotels and hotel residences; it also develops real estate
projects as promoter.


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


HARBOURMASTER CLO: Fitch Withdraws 'BBsf' Rating on Two Notes
-------------------------------------------------------------
Fitch Ratings has withdrawn the ratings of Harbourmaster CLO 5
B.V.'s class S2 combination notes and Harbourmaster Pro-Rata CLO 1
B.V.'s class S1 combination notes as listed below.  Both
combination notes have been exchanged for their component notes,
and subsequently cancelled.

Harbourmaster Pro-Rata CLO 1 B.V.:

* Class S1 combination notes (ISIN XS0255335340): 'BBsf' Outlook
  Negative; withdrawn

Harbourmaster CLO 5 B.V.:

* Class S2 combination Notes (ISIN: XS0223504555 'BB+sf' Outlook
  Negative; withdrawn


===============
S L O V E N I A
===============


VEGRAD D.D.: Chief Executive Officer Hilda Tovsak Steps Down
------------------------------------------------------------
Slovenia Times reports that Hilda Tovsak, Vegrad d.d.'s chief
executive officer, quit her post at the company on Monday.

Slovenia Times relates Boris Medved was appointed as Ms. Tovsak's
replacement and Sandi Knez was named crisis manager.

As reported by the Troubled Company Reporter-Europe On Aug. 16,
2010, Bloomberg News disclosed that Ms. Tovsak, as cited by
Finance newspaper, said that the company is insolvent.  The
Ljubljana-based newspaper said the company is preparing a
financial overhaul that would include the start of the
receivership process, according to Bloomberg.

Vegrad d.d. is Slovenia's second-largest construction company.


=============
U K R A I N E
=============


ALFA-BANK UKRAINE: S&P Gives Stable Outlook; Affirms 'CCC+' Rating
------------------------------------------------------------------
Standard & Poor's Ratings Services said that it had revised its
outlook on Alfa-Bank Ukraine to positive from stable and raised
the Ukraine national scale rating to 'uaBB' from 'uaBB-'.  At the
same time, the 'CCC+' long-term and 'C' short-term counterparty
credit ratings were affirmed.

"The outlook revision reflects ABU's improving liquidity, due to
an influx of customer deposits, a sustained strong market
position, and recently supported capitalization amid the gradually
stabilizing economy in Ukraine," said Standard & Poor's credit
analyst Maria Malyukova.

The ratings continue to be constrained by ABU's weak asset quality
and fragile profitability.

ABU's liquidity has been improving because of a reported influx of
customer deposits, in particular retail, in the first five months
of 2010 amid the gradually stabilizing economic environment.  A
Eurobond exchange in August 2009 with an extended maturity until
July 2012 reduced ABU's short-term foreign debt repayment burden,
with the first quarterly amortizing payment of US$105 million
coming due in October 2010.  The current liquidity cushion appears
to be sufficient to cover it.  Moreover, there are additional
funding sources available.  However, whereas short-term liquidity
needs appear to be met, S&P is concerned about ABU's long-term
liquidity and funding sustainability.

ABU is the ninth-largest bank in Ukraine according to statistics
from the National Bank of Ukraine.  The bank had total assets of
US$3 billion on May 31, 2010, and a market share of 3.1%.  It is
ultimately fully owned by Alfa Group Consortium (AGC; not rated),
a large Russian conglomerate, through a 19.9% stake held by OJSC
Alfa-Bank (B+/Positive/B; Russia national scale 'ruA+'), the
largest privately owned bank in Russia, and 80.1% by ABH Ukraine
Ltd.

ABU's asset quality, significantly pressured by the banking and
economic downturn in 2009, still remains at risk.  Overdue and
restructured loans account for a sizable part of the loan book At
the same time, accumulated loan-loss reserves cover existing
overdue loans.  S&P expects the creation of new provisions for
this year to be substantially less than in 2009, as S&P believes
the growth in problem loans has likely peaked.  However, narrowed
interest margins and provisioning needs will still constrain
profitability in 2010.

The positive outlook reflects S&P's view that market pressure on
the bank's financial and business profile is gradually receding.

S&P would consider a positive rating action if the bank shows a
longer-term track record of sustainable liquidity, improvement in
asset quality and profitability, and maintenance of adequate
capitalization.

S&P would lower the ratings if ABU's liquidity position were to
weaken considerably, or asset quality and capitalization were to
be constrained significantly.


KREDOBANK PJSC: S&P Raises Counterparty Credit Rating to 'B-'
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it had raised its
long-term counterparty credit ratings on PJSC KREDOBANK to B- from
CCC+.  The outlook is stable.  At the same time the 'C' short-term
counterparty credit ratings were affirmed.  The Ukrainian national
scale rating was raised to 'uaBBB-' from 'uaBB-'.

The rating action reflects an improvement in KREDOBANK's financial
standing based on stronger explicit ongoing parental support from
its 99.5% shareholder, Powszechna Kasa Oszczednosci Bank Polski
(S.A.) ('BBBpi').  PKO has provided KREDOBANK with funding and
capital injections, as well as guarantees on a part of its
problematic loan portfolio.  This mitigates the bank's high credit
risk amid challenging economic conditions in Ukraine.

S&P considers KREDOBANK a strategically important subsidiary of
PKO, given the importance of Ukraine for PKO's growth strategy,
the bank's integration into PKO, and the parent's record of
support for the bank.  Accordingly, the long-term rating
incorporates a one-notch uplift above the bank's stand-alone
credit profile.

PKO injected US$150 million of capital into KREDOBANK in 2009,
which boosted the bank's capitalization; on Dec. 31, 2009, the
bank's ratio of adjusted total equity to assets was 11.6% compared
with 1.6% a year earlier.  As of Aug. 1, 2010, KREDOBANK has
finalized registration of a further US$46 million capital
increase.  Funding support from PKO includes a US$90 million
standby credit line and Ukrainian hryvnia (UAH) 276 (million in
subordinated debt.  Current parental funding accounts for 15% of
liabilities.  In July 2010, PKO approved UAH300 million in
guarantees against the bank's problem loan portfolio and
authorized a further UAH500 million later in the year.

KREDOBANK is a midsize Ukrainian commercial bank.  It had total
assets of US$650 million (UAH5.2 billion) on Dec. 31, 2009.  It
has a good market position in western Ukraine (Lviv region).

KREDOBANK's credit risk profile has weakened significantly due to
a sharp deterioration in domestic economic conditions and the
subsequent negative effect on its loan portfolio.  Nonperforming
loans (overdue by more than 90 days) amounted to 56% of total
loans on June 30, 2009.  Loan loss reserves account for 31% of the
loan book.  To address its asset quality issues, the bank has
enhanced its credit risk management with a focus on lending
monitoring, debt collection, loan restructuring, and new
underwriting polices.  PKO's guarantees against the problematic
loan portfolio may lead to a release of some loan loss reserves,
which in turn may help to improve profitability.  However, S&P
expects KREDOBANK's profitability to remain weak due to its
narrowing net interest margin and high provisioning burden.

KREDOBANK's funding profile has stabilized and its liquidity has
improved, with cash and bank placements accounting for 19.5% of
total assets as of June 30, 2010.  KREDOBANK does not have any
significant wholesale funding from abroad.

The stable outlook balances parental support and gradual signs of
economic recovery in Ukraine against KREDOBANK's high credit risk
and poor profitability.


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


BAR VASA: Business as Usual Despite Receivership
------------------------------------------------
Bar Vasa in Folkestone is open for business as usual, despite
entering into receivership in June.  FRP Advisory LLP appointed
administrators.

Bar Vasa, a Mediterranean style restaurant/bar with private hire
facility situated on the Esplanade in Folkestone, is open for
business as usual, despite entering into receivership in June.

Chris Stevens and Ian Vickers, Partners at FRP Advisory LLP, the
restructuring, recovery and insolvency specialists, were appointed
Joint Receivers of the property at 4-5 The Esplanade, Sandgate, on
June 14, 2010.

Commenting on the case, Chris Stevens said: "Trading is ongoing
and the bar, restaurant and private hire VIP lounge are very much
open for business as usual.  Meanwhile, a purchaser is being
sought for the freehold."

The property also contains four long leasehold flats on the second
and third floors.


DEUTSCHE PFANDBRIEFBANK: Moody's Junks Ratings on Various Notes
---------------------------------------------------------------
Moody's Investors Service has downgraded the Senior CDS and all
classes of Notes issued by Deutsche Pfandbriefbank AG (Estate UK-
3) (amounts reflect initial outstandings):

  -- GBP482.45M Class A1+ (CDS) Floating Rate Amortising Credit-
     Linked Notes, Downgraded to Aa3 (sf); previously on Jul 14,
     2010 Aa2 (sf) Placed Under Review for Possible Downgrade

  -- GBP0.4M Class A1+ Floating Rate Amortising Credit-Linked
     Notes, Downgraded to Aa3 (sf); previously on Jul 14, 2010 Aa2
     (sf) Placed Under Review for Possible Downgrade

  -- GBP29.8M Class A2 Floating Rate Amortising Credit-Linked
     Notes, Downgraded to Ba3 (sf); previously on Jul 14, 2010
     Baa1 (sf) Placed Under Review for Possible Downgrade

  -- GBP35.76M Class B Floating Rate Amortising Credit-Linked
     Notes, Downgraded to Caa1 (sf); previously on Jul 14, 2010
     Ba2 (sf) Placed Under Review for Possible Downgrade

  -- GBP24.56M Class C Floating Rate Amortising Credit-Linked
     Notes, Downgraded to Ca (sf); previously on Jul 14, 2010 B2
     (sf) Placed Under Review for Possible Downgrade

  -- GBP8.24M Class D Floating Rate Amortising Credit-Linked
     Notes, Downgraded to Ca (sf); previously on Jul 14, 2010 B3
     (sf) Placed Under Review for Possible Downgrade

  -- GBP14.92M Class E Floating Rate Amortising Credit-Linked
     Notes, Downgraded to Ca (sf); previously on Jul 14, 2010 Caa2
     (sf) Placed Under Review for Possible Downgrade

                        Ratings Rationale

The downgrade action has been prompted by a new valuation, dated
May 2010, for the property portfolio securing Loan No 3 (39% of
the current portfolio).  The new value of GBP156.3 million is 53%
below the portfolio value as of May 2007 and is also below the
trough value Moody's estimated in its June 2009 review of the
transaction.

Loan No 3 is comprised of a GBP239.42 million whole loan, out of
which GBP175.67 million is securitized with the remaining portion
being pari passu in terms of ranking.  The loan is secured by
three secondary shopping centres and is scheduled to mature in
April 2013 with no extension option available.  There is no
amortization on the loan.

The downgrades of the Senior CDS and the Notes follow a detailed
re-assessment of the loan and property portfolio's credit risk.
Hereby, Moody's main focus was on property value declines since
its last review in June 2009, term default risk, refinancing risk
and the anticipated work-out timing for potentially defaulting
loans.

Driven by in most cases a higher default risk assessment at the
loan maturity dates, Moody's anticipates that a large portion of
the portfolio will default over the course of the transaction
term.  Coupled with the negative impact of significantly reduced
property values, Moody's expects a substantial amount of losses on
the securitized portfolio.

The Class A2, Class B, Class C, Class D and Class E are
subordinated classes in the transaction's capital structure.  Due
to this additional leverage, the higher portfolio risk assessment
has a relatively bigger impact on the expected loss of those Notes
than on the expected loss of the senior Notes.  Also, the expected
loss for the portfolio is larger than the size of the Class C, D
and E Notes combined and this high expected loss with limited
recovery rates expected results in the Ca (sf) rating on these
classes.

The Senior CDS and Class A1+ Notes have benefited from the
sequentially allocated loan prepayments, which have increased the
subordination that is available to them to 25% from 19% at
closing.  This increased credit enhancement provides protection
for these senior Notes against the increased expected loss on the
securitized portfolio.

The primary source of assumption uncertainty for the transaction
is the future development of commercial real estate capital values
in the UK.  Moody's central scenarios assume that property values
in EMEA will be characterized by a continuing strong
differentiation between prime and secondary properties.  In the UK
prime market, there was evidence that capital values increased
since Q3 2009.  It is doubtful whether the pace of this increase
is sustainable.  However, in Moody's view, the UK prime market
bottomed out in 2009 and prime values will continue to increase
until 2012/2013, albeit at a very moderate pace.  Secondary
property values remained under pressure in 2009 and Moody's
believes they will further decline until they reach their trough
in late 2010.  Overall, in Moody's view, the UK property market
will reach its inflexion point in 2010 and will stabilize and
moderately increase until 2012/2013.

Moody's estimates that compared to the underwriter's values at
closing in 2007, the values of the properties securing this
transaction have declined by on aggregate 25% until mid-2010
(ranging from a 4% value increase for the Loan No 13 to a 53%
value decline for the Loan No 3).  Taking into account the updated
valuations since the close of the transaction, Moody's value is
only 1% lower than the current aggregate U/W value for the
portfolio.  The current A-loan U/W LTV for the portfolio is 93.6%
while the whole loan U/W LTV is 100.8%.  Moody's has taken the
anticipated property value development, including a gradual
recovery from 2010-2011 onwards, into account when analyzing the
default risk at loan maturity and the loss given default for each
securitized loan.

The transaction's exposure to loans maturing in the short-term
(2010 and 2011) is considerable.  12.1% of the current portfolio
matures in 2010 and 2011, 48.4% in 2013, 12.2% in 2015 and 27.3%
in 2019.  As Moody's expects property values in the UK to only
slowly recover from 2010-2011 onwards, most of the loans (except
for Loan No 5, 9 and 13, which only mature in 2015 and beyond)
will be still highly leveraged at their respective maturity dates.
Consequently, in Moody's view, for almost all of the loans, the
default risk at maturity has increased substantially compared to
the closing analysis.

This synthetic transaction closed in February 2007 and represents
the securitization of initially 13 commercial mortgage loans
("reference claims") originated by Hypo Real Estate Bank
International AG, now Deutsche Pfandbriefbank AG (A3, P-1).  The
loans were secured by first ranking legal mortgages on 110
commercial properties located in the United Kingdom.  The
portfolio comprised 43.9% retail, 28.3% office, 16.6% mixed-use
and 11.2% other properties based on securitized loan balance.

Since closing of the transaction, four loans have prepaid in full,
which were all above average quality in terms of Moody's
assessment at closing of the transaction.  Following the four full
loan prepayments along with loan amortization and partial
prepayments, 75.6% of the original pool balance remains.  The pre-
and repayment proceeds were allocated to the Senior CDS.

The remaining loans are not equally contributing to the portfolio:
the largest loan (Loan No 3) represents 39.0% of the current
portfolio balance, while the smallest loan (Loan No 11) represents
2.1%.  The current loan Herfindahl index is 4.6 compared to 7.0 at
closing, indicating a higher loan concentration after prepayments.
The remaining nine loans are secured by 107 commercial properties,
of which 51.2% are retail, 18.6% mixed-use, 16.6% office, and
13.7% other properties in terms of securitized loan balance.  They
are located throughout the United Kingdom, mainly in Yorkshire &
Humberland (21.7%), London (17.2%), South East England (17.8%),
Wales (15.0%), West Midlands (6.2%) and UK Other (22.1%).

Loan No 7 which had its maturity date in July 2010, did not repay.
Moody's understanding is that the loan is currently being
restructured and an extension of the loan term is likely.  Also,
following the re-valuation of the retail properties securing Loan
No 3, the loan breached its LTV covenant and a default
notification was sent to the borrower.  Neither Loan No 3 nor Loan
No 7 are not classified as a "Defaulted Reference Claim" or a
"Credit Event" as per transaction documentation.

Moody's Investors Service received and took into account one or
more third party due diligence reports on the underlying assets or
financial instruments in this transaction and the due diligence
reports had a neutral impact on the rating.

Moody's notes that the depth of information at property and tenant
level and on sponsors of the loans provided in the investor
reports is below average compared to other EMEA CMBS transactions
due to confidentiality reasons.  Accordingly, there is additional
uncertainty regarding the underlying assumptions used in the
rating process.

                     Regulatory Disclosures

This issuer did not participate in the credit rating process.  The
Rating Committee was not provided, for purposes of the rating,
access to the books, records and other relevant internal documents
of the rated entity or related third party.

The rating has been disclosed to the rated entity or its
designated agents and issued with no amendment resulting from that
disclosure.

Information sources used to prepare the credit rating are these:
parties involved in the ratings, public information and
confidential and proprietary Moody's Investors Service's
information.


EDSON DISTRIBUTION: Goes Into Liquidation
-----------------------------------------
Dominic Perry at Roadtransport.com Edson Distribution has gone
into liquidation, leaving a total deficiency of GBP255,780, with
the majority owed to trade creditors.

Edson Distribution is a Southampton-based haulier.


HARKERS DISTRIBUTION: Goes Into Administration
----------------------------------------------
Joanna Bourke at Roadtransport.com reports that Harkers
Distribution has gone into administration.

The report relates Ian Green and Nicholas Reed of
PricewaterhouseCoopers were appointed joint administrators to the
company on Aug. 17.

Harkers Distribution is the transport arm of Sunderland-based
Angel Distribution.  The company was set up in 2006.


POLLY PECK: Kevin Hellard Wants to Question Nadir Over Bankruptcy
-----------------------------------------------------------------
Santhie Goundar at Accountancy Age reports that a Grant Thornton
partner is seeking an interview with Asil Nadir over unresolved
bankruptcy issues now he has returned to the UK.

Kevin Hellard, a partner in the Grant Thornton's fraud and
insolvency division, hopes to speak to Mr. Nadir about his
activities in Cyprus since the bankruptcy action was taken in
1992, the report discloses.  Mr. Hellard, Mr. Nadir's bankruptcy
trustee, wants to discover whether the former Polly Peck tycoon
has assets that can be clawed back for creditors, the report says.

Mr. Nadir emigrated to Northern Cyprus following the collapse of
his company, Polly Peck, in 1990 and a subsequent bankruptcy
filing followed, the report relates.  He was charged with fraud
and theft but fled the UK before he was due to stand trial in
1993, the report recounts.  He returned to the UK last week to
stand trial and is due to appear at the Old Bailey on Friday,
Sept. 3, the report discloses.

According to the report, Mr. Hellard said that Mr. Nadir's
creditors had claimed debts of GBP374.6 million in total, with the
main creditor being Polly Peck, which is now in administration.
Debts to Polly Peck stand at GBP262.5 million, although this is
being disputed by Mr. Nadir, the report says.  Other creditors
include banks, brokers and HMRC, whose claims come from Mr.
Nadir's involvement in Polly Peck, the report states.

Polly Peck International (PPI) was a small and barely profitable
United Kingdom textile company which expanded rapidly in the 1980s
and became a constituent of the FTSE 100 Index before it collapsed
in 1991.


* UK: Distressed Deals Involving North East Businesses Rise
-----------------------------------------------------------
Peter McCusker at The Journal, citing new research conducted by
Experian Corpfin on behalf of insolvency trade body R3, reports
that the number of distressed deals involving North East
businesses has increased by more than a third since 2008.

According to the report, one in nine (11%) of the regional mergers
and acquisitions completed in the first half of 2010 involved
distressed businesses, compared to just 8% in 2008.

Linda Farish, chairman of the North East arm of R3 and director of
recovery & insolvency at Newcastle-based accountants RMT, expects
the trend to continue for the foreseeable future, the report
notes.


* UK: Conservatives Drop Plans for Business Insolvency Reform
-------------------------------------------------------------
Santhie Goundar at Accountancy Age, citing the Financial Times,
reports that the Conservatives have "quietly dropped" their plans
for business insolvency reform after opposition from business
leaders.

Accountancy Age relates Prime Minister David Cameron had
originally called for the introduction of US-style Chapter 11
bankruptcy protection rules, saying the UK's insolvency process
did not offer enough protection to distressed companies, a move
that was met with little enthusiasm in the corporate world.
According to Accountancy Age, the newspaper says this will put
pressure on the coalition to protect struggling firms from banks
hoping to use an economic recovery to sell their assets and call
in loans.

Accountancy Age notes with the plans seemingly abandoned,
Conservative MP George Eustace has tabled a private members' bill
aiming to "reduce litigation and encourage banks to work with
their customers to find solutions" and, he says, bring in "much
needed responsibility in the banking sector."


* UK: Landlords to Get Profit Share Under CVA Created by PwC
------------------------------------------------------------
Reuters reports that PricewaterhouseCoopers have created a company
voluntary arrangement that gives a property's landlord a share of
the profits if the company renting the property goes into
administration but comes out in an improved situation.

According to Reuters, many landlords have complained that CVAs are
used by businesses to get rid of unprofitable properties, as the
instruments permit them to renegotiate leases providing that they
have the support of 75% of their creditors by value.


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


* BOOK REVIEW: The U.S. Healthcare Certificate of Need Sourcebook
-----------------------------------------------------------------
Author: Robert James Cimasi
Publisher: Beard Books
Softcover: 520 pages
Price: US$199.95
Review by Henry Berry

Established more than 30 years ago by the federal government and
state governments, the Certificate of Need (CON) program was
intended to be a primary way to control healthcare costs by
regulating major capital expenditures and modifying healthcare
service capacity.  According to the author, the CON program is
based on the premise that, "in an unregulated market health-care
providers will provide the latest costly technology and equipment,
regardless of duplication or need."

With healthcare costs continuing to rise inexorably, CON programs
are being reconsidered and reviewed by federal and state
regulators and healthcare agencies.  The CON program is still used
by most states to control healthcare costs, although some states
have abandoned the program or substantially modified it.  The
number of states with CON programs peaked at 49 in 1980 and
remained in the high 40s for most of the 1980s.  In 1988, the
number dipped to 39 and has held steady in the high to mid 30s
since then.  In 2004, the number was at 36. Regardless, the CON
program has significantly affected the delivery of healthcare in
this country and still does.

The U.S. Healthcare Certificate of Need Sourcebook is encyclopedic
in scope and content, which reflects the author's breadth of
knowledge about the subject matter.  For over 20 years, Cimasi has
helped clients in nearly every state understand and comply with
the requirements of the CON program.  He is a leading authority on
CON issues, practices, procedures, regulations, and standards, and
he has an incomparable background in healthcare consulting,
litigation, and mergers and acquisitions.

Cimasi draws upon his formidable experience and his record of
helping healthcare businesses adapt to market and regulatory
changes to present a great amount of information, cases, and
developments relating to the CON program.

The book offers readers an overview of CON program basics and a
history of its development.  This overview is complemented with a
discussion of federal and state court cases and state
administrative cases and decisions affecting the program's
application.  The author's treatment of these cases is thorough --
the cases categorized by states alone cover nearly 120 pages.  The
multitude of state cases are cited and annotated according to
different levels of state courts, and also by their underlying
causes of action and classification of regulated asset.  For
example, 20 underlying causes of action are offered under seven
headings.  The classifications for causes of action include
procedural due process violations, arbitrary CON board decisions,
establishment/challenge to new need requirements for state health
plans, and definition of regulatory terms. The classifications for
regulated assets include medical equipment such as magnetic
resonance imaging and computerized tomography; ambulatory surgery
centers; cancer treatment centers, dentist offices, hospitals, and
other facilities; and services, including ambulances, cardiac
catheterization, and dialysis.

While the book is extraordinarily comprehensive in its treatment
of the subject matter, it is also interactive and user friendly.
From his experience with clients, Cimasi understands what is most
important to impart to readers about the numerous cases cited
throughout the book.  The utility of this work is reflected in the
"abstracts" of each case.  The abstracts are categorized by state
and include complete, consistent identification of each case
according to standard legal annotation. Each abstract describes
the grounds of the action, states the findings of the court, and
gives the court's decision.  For example, a sample abstract of the
1987 case Platte County Medical Center Inc. v. Missouri Health
Facilities Review Committee describes the circumstances leading up
to a final decision by an appeals court -- "Denied applicant
appealed to the Circuit Court, Cole County after Committee denied
its applicant for CON" -- along with other specifics of the case.
The finding of the appeals court, which ended the litigation, was
that the "Committee's failure to issue decision in a timely manner
(under 120 days) indicated approval of CON."  This information is
useful for readers not only for decisions in particular states,
but also for rulings for compliance with CON statutes and
regulations by both healthcare organizations in the private sector
and the government.

Cimasi's book offers several other resources.  One is a
bibliography of hundreds of books and articles on CON. The
Sourcebook also lists CON statutes and regulations by state and
contact information for state agencies responsible for program
implementation. Useful websites are also provided.

This thorough guide and reference is invaluable to anyone who will
be or is involved in the CON program in any of the states where it
is still in place.  Readers will also find it uniquely informative
on government policies concerning healthcare.

Robert James Cimasi, President of Health Capital Consultants, has
a long and broad background in the fields of healthcare and
business appraisal and mergers and acquisitions.  A frequent
speaker at conferences for national healthcare organizations, he
is also the author of three books on healthcare and contributor of
articles to others.


                            *********

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
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$625 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
contact Christopher Beard at 240/629-3300.


                 * * * End of Transmission * * *