/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/110406.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 Wednesday, April 6, 2011, Vol. 12, No. 68 Headlines B U L G A R I A * BULGARIA: Sees Rise in Investment Intermediaries Liquidations C Z E C H R E P U B L I C * CZECH REPUBLIC: Electricity Providers Likely to Face Bankruptcy * CZECH REPUBLIC: Company Insolvency Petitions Up 22% in 1Q2011 F R A N C E BELVEDERE SA: Dijon Court Lifts Creditor Protection H U N G A R Y * HUNGARY: Company Mandatory Liquidations Down 11% in March I C E L A N D * ICELAND: UK Councils Await Decision in Case v. Failed Banks I R E L A N D IRISH LIFE: Plans to Float Pensions & Investment Business IRISH LIFE: Moody's Downgrades Subordinated Debt Rating to 'Ca' I T A L Y CELL THERAPEUTICS: Estimates US$5.84 Mil. February Net Loss EUROHOME MORTGAGES: S&P Affirms 'CCC' Rating on Class D Notes FIAT FINANCE: Fitch Assigns 'BB+' Rating to 2016 Unsecured Bonds L A T V I A NORVIK BANKA: Fitch Withdraws 'B' Long-Term Issuer Default Rating L I T H U A N I A LITHUANIAN BANKAS: Fitch Affirms LT Issuer Default Rating at 'B+' N E T H E R L A N D S MAGYAR TELECOM: Moody's Affirms 'B2' Corporate Family Rating R U S S I A ROSTELECOM OJSC: S&P Withdraws Ratings on 5 Telcos After Merger S P A I N BBVA FINANZIA: S&P Lowers Rating on Class C Notes to 'CCC (sf)' CAJA DE AHORROS: Fitch Downgrades Individual Rating to 'E' CAJA MEDITERRANEO: Faces Nationalization After Seeking Aid SEGURFONDO INVERSION: Faces Liquidation Following Two-Year Closure TDA CREDIFIMO: S&P Affirms 'CCC-' Rating on Class E Notes U N I T E D K I N G D O M DIXONS RETAIL: Moody's Puts 'Ba3' Rating on Review for Downgrade ETIC SOLUTIONS: Winding-Up Petition Set to Be Heard on April 14 HMV GROUP: Issues Fifth Profit Warning; Covenant Tests Moved MCINERNEY HOLDINGS: Administrators Appointed to Seven Companies ODDBINS PLC: In Administration; Deloitte Seeks Potential Buyers ROMAG: Business & Assets Sold to Gentoo Group Subsidiaries SIGNUM VERMILLION: Moody's Cuts Rating on US$32-Mil. Notes to 'B3' ********* =============== B U L G A R I A =============== * BULGARIA: Sees Rise in Investment Intermediaries Liquidations --------------------------------------------------------------- Novinite.com reports that Angel Dzhalazov, deputy head of the Financial Supervision Commission, said Bulgaria has seen a boom of investment intermediaries filing for voluntary liquidation since the beginning of the year due to stagnation in the sector. According to Novinite.com, a report of the regulator shows that the trend started last year with the number of companies active in the segment declined to 55 in November from 61 in June even though on the whole investment intermediaries saw an improvement in their financial results for the period. Novinite.com relates that among the troubled intermediaries which exited the market last year were Astra Investment, BulFin Invest, Eurodealing, EFG Securities Bulgaria, Capital Engineer Project, Capital Finance, Leader Invest, Makler 2002, Rock Ridge Investment, CEE Securities and Sofia Invest Brokerage. "The sector is being restructured due to the lack of clients. What our agency can do is serve as a middle man by both listening to the demands of the businesses and monitoring that the rules are being abided by," Novinite.com quotes Mr. Dzhalazov as saying. Fifteen percent of the Bulgarian companies and bank accounts receivables have to be written off or restructured, Novinite.com says, citing an ICAP survey, which evaluated 13,769 Bulgarian companies and estimated both the probability of default and the expected loss in case of default. =========================== C Z E C H R E P U B L I C =========================== * CZECH REPUBLIC: Electricity Providers Likely to Face Bankruptcy ----------------------------------------------------------------- According to Bloomberg News' Ladka Bauerova, Lidove Noviny, citing Dean Brabec, the Prague-based regional executive of Arthur D. Little, reported that some Czech electricity providers may go bankrupt as power prices increase due to Germany's decision to shut down seven older nuclear reactors. According to Bloomberg, Mr. Barabec, as cited by the newspaper, said bankruptcies could mean the return of end customers to CEZ AS and the Czech unit of E.ON AG. * CZECH REPUBLIC: Company Insolvency Petitions Up 22% in 1Q2011 --------------------------------------------------------------- CTK, citing Creditreform, reports that the number of insolvency petitions against Czech companies rose by 22% to 1,573 in the first quarter of 2011. The biggest number of companies in insolvency was registered in Prague and in Jihomoravsky (South Moravia) and Moravskoslezsky (North Moravia) regions, CTK notes. According to CTK, as for individual sectors, the highest number of insolvencies was recorded in wholesale trade, construction and catering, followed by retail trade and freight transport. CTK notes that about one half of insolvency petitions against legal entities end in declaration of insolvency. Insolvency is settled either through bankruptcy or reorganization of the company, CTK discloses. =========== F R A N C E =========== BELVEDERE SA: Dijon Court Lifts Creditor Protection --------------------------------------------------- David Whitehouse at Bloomberg News, citing Les Echos, reports that Belvedere SA's creditor protection was ended after a court in Dijon, France, found that the company failed to meet its obligations. According to Bloomberg, the newspaper cited an unidentified creditor representative as saying that it will now be possible to demand repayment from the company. As reported by the Troubled Company Reporter-Europe on December 15, 2010, Bloomberg News related that Belvedere made a preliminary payment to bondholders of EUR23 million (US$30.8 million) and postponed its sale of units, including Marie Brizard and Polish distributors, which had been part of its court-approved bankruptcy recovery plan. Belvedere's recovery plan was approved in November 2009, detailing steps including asset sales, Bloomberg disclosed. The company bought Marie Brizard, whose brands include Old Lady's Gin and Tullamore Dew Whiskey, in 2005, in part by issuing Floating Rate Notes, according to Bloomberg. Bloomberg noted that Belvedere violated terms of the notes, which led it to file for court protection from creditors. 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. ============= H U N G A R Y ============= * HUNGARY: Company Mandatory Liquidations Down 11% in March ----------------------------------------------------------- MTI-Econews, citing company information provider Opten, reports that the number of mandatory liquidations initiated against Hungarian companies declined by 11% yr/yr to 1,501 in March. According to the report, the number of voluntary liquidations reached 2,142 in March, down 109 or 4.9% from February, but up 77.9% from one year earlier. ============= I C E L A N D ============= * ICELAND: UK Councils Await Decision in Case v. Failed Banks ------------------------------------------------------------- Dan Grimmer at Norwich Evening News 24 reports that the fate of millions of pounds of taxpayers' cash, which is currently frozen in Icelandic banks could be known within days. Norfolk County Council is one of four councils involved in a make- or-break court case to recover the cash, with a judgment imminent, Evening News discloses. According to Evening News, the county council had GBP32.5 million invested in three Icelandic banks, which collapsed in October 2008, and had their assets frozen by administrators. Norfolk County Council had GBP15 million in Landsbanki, GBP10 million in Kaupthing and GBP7.5 million in Glitnir when the Icelandic government took them into administration, Evening News states. Norfolk, along with Kent, Wiltshire and Aylesbury Vale councils, are the test cases in proceedings at Iceland's District Court, with the action coordinated by the Local Government Association, Evening News notes. The court action, Evening News cites, revolves around a decision by Glitnir's administrators to name local authorities that will be deemed as priority creditors. Priority creditors will be at the front of the queue when it comes to the money being handed out. Landsbanki did not make local councils priority creditors and the LGA lawyers are arguing they should have been, Evening News relates. Hearings were held in Icelandic courts in the past months and the judge is expected to announce his verdict very shortly, Evening News notes. The judgment will determine whether local authorities, including councils, police and fire authorities, will get their cash back, Evening News states. The court action is a potential gamble because if the judge rules the councils should not be priority creditors for Landsbanki, then they would also lose their status as priority creditors for Glitnir, Evening News cites. Any decision reached is also likely to be drawn-out legal appeals, Evening News adds. "We await the Icelandic District Court decision and will consider our next steps once we have received the judgment," Evening News quotes Steve Reilly, a spokesman for Norfolk County Council, as saying. The legal costs of the court action are being shared between the authorities trying to recoup the cash, Evening News discloses. ============= I R E L A N D ============= IRISH LIFE: Plans to Float Pensions & Investment Business --------------------------------------------------------- Barry O'Halloran at The Irish Times reports that Irish Life & Permanent (IL&P) plans to float its pensions and investment business on the stock market to boost its capital and meet new standards imposed by the Central Bank. The Irish Times says tests on Irish banks to determine how much more capital they need have calculated that IL&P requires EUR4 billion to cover the cost of potential losses from home loans, which amount to twice its deposits, and to insure against future risks to its solvency. As a result, the group is likely to be broken up, The Irish Times states. Its retail banking arm is set be taken largely into State ownership, while Irish Life, its profitable life and pensions business, will be sold, The Irish Times discloses. According to The Irish Times, the group said on March 31 that in the near term, it expects to float Irish Life on the Dublin and London stock exchanges through an initial public offering (IPO), which it believes would be the best way to maximize its value. Overall, the group said that liability management exercises and the sale of its non-banking business would cut the EUR4 billion requirement by EUR1.1 billion, meaning that the State would have to provide EUR2.9 billion, The Irish Times notes. The Irish Times says if this were to go ahead, it would leave the retail arm, Permanent TSB, as a personal banking and home loan specialist, which would be mainly State-owned, and which would compete for business on the high street with the Government's other "two banking pillars", Bank of Ireland and a merged AIB and EBS. Financial regulator Matthew Elderfield explained on March 31 that the EUR4 billion that IL&P needs includes EUR3.3 billion to meet capital requirements that is to ensure that it has enough money to absorb losses and remain solvent up to the end of 2013, The Irish Times cites. The extra EUR700 million is a buffer against risks that could arise after that date, according to The Irish Times. Headquartered in Dublin, Irish Life & Permanent plc -- http://www.irishlifepermanent.ie/-- is a provider of personal financial services to the Irish market. Its business segments include banking, which provides retail banking services; insurance and investment, which includes individual and group life assurance and investment contracts, pensions and annuity business written in Irish Life Assurance plc and Irish Life International, and the investment management business written in Irish Life Investment Managers Limited; general insurance, which includes property and casualty insurance carried out through its associate, Allianz- Irish Life Holdings plc, and other, which includes a number of small business units. On June 30, 2008, it acquired the rest of the 50% interest in Joint Mortgage Holdings No. 1 Limited (the parent of Springboard Mortgages Limited), resulting in Springboard Mortgages becoming a wholly owned subsidiary. On December 23, 2008, it acquired an additional 23% of Cornmarket Group Financial Services Ltd, bringing its interest to 98%. * * * As reported by the Troubled Company Reporter-Europe on Dec. 8, 2010, DBRS downgraded the Dated Subordinated Debt rating of Irish Life & Permanent plc (IL&P or the Group) to BB from BBB to reflect the increased risk of adverse action by the government. This rating action reflects DBRS's view that the risk of loss for holders of subordinated debt instruments of Irish banks has increased significantly given recent actions and various statements by the Irish Government. As reported by the Troubled Company Reporter-Europe on April 8, 2010, Fitch Ratings downgraded Irish Life & Permanent's Individual rating to 'D' from 'C'. Fitch said the downgrade reflects Fitch's concerns about ILP's profitability in the next two years, its ability to absorb increased provisioning charges in the banking business through operating profits, the standalone capital position of the bank and its large share of wholesale funding. According to Fitch, while the insurance business, Irish Life, continues to be profitable at an operating level, its profitability was not sufficient to compensate for losses in the banking business, permanent tsb, in 2009. IL&P continues to carry Moody's Investors Service's standalone Bank Financial Strength Rating of D, which maps to Ba2 on the long term rating scale. IL&P's also carries an undated subordinated debt rating of Ba3 from the rating agency. IRISH LIFE: Moody's Downgrades Subordinated Debt Rating to 'Ca' --------------------------------------------------------------- Moody's Investors Service has downgraded the dated subordinated of Irish Life & Permanent (IL&P) to Ca from B2 and the junior subordinated debt to Ca (hyb) from B3 (hyb). The bank is rated Ba2 (on review for possible downgrade)/(P)Not-Prime for senior debt and Baa3/P-3 (on review for possible downgrade) for bank deposits and has a D- bank financial strength rating (BFSR), mapping to Ba3 on the long-term scale. The outlook on the BFSR is negative. Ratings Rationale The downgrade of the bank's dated subordinated and junior subordinated debt follows an announcement from the bank that it will undertake a liability management exercise as a result of the bank's need to raise a significant amount of capital as detailed by the Central Bank of Ireland (CBI) on March 31, 2011. Following the completion of its Prudential Capital Assessment Review (PCAR), the CBI is requiring IL&P to raise EUR4 billion to comply with the new capital requirements. The CBI is requiring that the bank must be able to maintain a core tier 1 ratio of 6% after incorporating their adverse stress test. The Ca and Ca (hyb) ratings on the dated subordinated and junior subordinated debt reflects that any exchange carried out by the bank, in an effort to meet the increased capital requirements, would almost certainly be classified as a distressed exchange given the potential that, absent an exchange, losses can be directly imposed on these classes of securities by the government through the legislation enacted in December 2010. The dated subordinated and junior subordinated debt ratings of IL&P were downgraded to B2/B3 (hyb) on Dec. 20, 2010. The D- BFSR assigned to IL&P already incorporates that the EU/IMF support package for Ireland and its banking system has made available significant funds for bank recapitalization, and this has been confirmed by the announcement by the Irish government that it will inject substantial capital into the bank. Were this capital not to be forthcoming then the D- BFSR would likely come under pressure. The principal methodologies used in this rating were Bank Financial Strength Ratings: Global Methodology published in February 2007, Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology published in March 2007, and Moody's Guidelines for Rating Bank Hybrid Securities and Subordinated Debt published in November 2009. Irish Life & Permanent plc is headquartered in Dublin, Ireland and had total assets of EUR75.7 billion at year-end 2010. ========= I T A L Y ========= CELL THERAPEUTICS: Estimates US$5.84 Mil. February Net Loss ----------------------------------------------------------- Cell Therapeutics, Inc., is providing information pursuant to a request from the Italian securities regulatory authority, CONSOB, pursuant to Article 114, Section 5 of the Unified Financial Act, that the Company issue at the end of each month a press release providing a monthly update of certain information relating to the Company's management and financial situation. However, the Company also directs its Italian shareholders to the Italian language section of its Web site at http://www.celltherapeutics.com/italiano/where more complete information about the Company and its products and operations, including press releases issued by the Company, as well as the Company's U.S. Securities and Exchange filings and the Listing Prospectus authorized to be published by CONSOB, can be found. The Company estimates a net loss of US$5.84 million on US$0 of net revenue for the month ended Feb. 28, 2011, compared to a net loss of US$4.04 million on US$0 of revenue for the month ended Jan. 31, 2011. In February 2011, the Company neither issued any new debt instruments nor bought any debt instruments already issued by the Company. The Company believes it is in compliance with the covenants on each series of its outstanding convertible notes. A full-text copy of the Monthly Information is available for free at http://is.gd/RemkF2 About Cell Therapeutics Headquartered in Seattle, Washington, Cell Therapeutics, Inc. (NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. The Company's balance sheet at Dec. 31, 2010, showed US$53.6 million in total assets, US$45.3 million in total liabilities, US$13.4 million in common stock purchase warrants, and a stockholders' deficit of US$5.1 million. Marcum LLP, in San Francisco, Calif., expressed substantial doubt about the Company's ability to continue as a going concern in its audit reports for the financial statements for 2009 and 2010. The independent auditors noted that the Company has incurred losses since its inception, and has a working capital deficiency of approximately US$14.2 million at Dec. 31, 2010. The Company reported a net loss of US$82.64 million on US$319,000 of revenue for the 12 months ended Dec. 31, 2010, compared with a net loss of US$82.64 million on US$80,000 of total revenue during the same period in 2009. EUROHOME MORTGAGES: S&P Affirms 'CCC' Rating on Class D Notes ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its credit ratings on Eurohome (Italy) Mortgages S.r.l.'s class A, B, and C notes. "At the same time, we affirmed our rating on the class D notes and removed the class B and C notes from CreditWatch negative. The class A notes remain on CreditWatch negative for counterparty reasons," S&P stated. "The performance of the collateral securing this transaction has continued to deteriorate, in our opinion, since we placed the class A to C notes on CreditWatch negative in November 2010. Total arrears have increased to 30.45% from 27.58% in August 2010, and 90+ days arrears are 21.23%, compared with 19.00% in August 2010," S&P related. Cumulative defaults have continued to increase and were at 13.31% in February 2011 -- just below the class D interest-deferral trigger, which is at 13.50%. "In our opinion, it is likely that the trigger will be hit within the next quarter, and that the class D notes will stop receiving interest. As such, we have affirmed our 'CCC (sf)' rating on the class D notes," S&P noted. "The high level of defaults has led to a considerable principal deficiency ledger (PDL) balance, in our view. As of February 2011, the aggregate amount in the PDLs was EUR21,852,742 -- an increase of EUR2,398,437 since August 2010. The class E and the D note PDLs are full -- i.e., they have reached the level of nominal notes outstanding, and there is EUR4,489,217 already on the class C note PDL. The interest-deferral trigger for the class C notes is 19.5%, and we believe that the likelihood of cumulative defaults reaching that level has continued to increase. This, coupled with the PDL balance for the class C notes, has led us to downgrade the class C notes further to 'B (sf)'," according to S&P. "Credit enhancement for the class A and B notes has fallen considerably since close, and this coupled with the poor pool performance has led us to downgrade these notes," S&P said. "Following our analysis, we have lowered our rating on the class A notes to a level that, in our opinion, is commensurate with their level of credit enhancement. Additionally, this rating is no longer on CreditWatch negative for credit reasons," S&P noted. "The class A notes remain on CreditWatch negative solely for counterparty reasons. We intend to resolve this CreditWatch negative placement before the transition date of July 18, 2011," said S&P. Eurohome (Italy) Mortgages is an Italian residential mortgage- backed securities (RMBS) transaction with loans originated by Deutsche Bank Mutui SpA. Eurohome (Italy) Mortgages closed in December 2007. Ratings list: Eurohome (Italy) Mortgages S.r.l. EUR260.85 Million Mortgage-Backed Floating-Rate Notes Class Rating To From Ratings Lowered and Removed Ratings Lowered and removed from CreditWatch Negative B A (sf) AA- (sf)/Watch Neg C B (sf) BB (sf)/Watch Neg Rating Lowered and Kept on CreditWatch Negative A AA- (sf)/Watch Neg AAA (sf)/Watch Neg Rating Affirmed D CCC (sf) CCC (sf) FIAT FINANCE: Fitch Assigns 'BB+' Rating to 2016 Unsecured Bonds ---------------------------------------------------------------- Fitch Ratings has assigned Fiat Finance and Trade Ltd.'s EUR1 billion 6.375% unsecured bond, due April 1, 2016, a 'BB+' rating. The rating is in line with Fiat S.p.A.'s (Fiat) senior unsecured 'BB+' rating. The issuance of the notes will be unconditionally and irrevocably guaranteed by Fiat ('BB+'/Negative/'B') under its EUR15 billion global medium-term note program. The bond will be used to refinance some of the EUR1.3 billion of bonds maturing in May 2011. The new bond will be mildly positive for Fiat's ratings, extending existing bond debt maturities by five years. The bond documentation includes negative pledge and change of control clauses. =========== L A T V I A =========== NORVIK BANKA: Fitch Withdraws 'B' Long-Term Issuer Default Rating ----------------------------------------------------------------- Fitch Ratings has affirmed and simultaneously withdrawn Latvia- based Norvik Banka's (Norvik) ratings, including its Long-term Issuer Default Rating (IDR) of 'B' and has revised the Outlook to Stable from Negative. The agency has also affirmed and withdrawn the bank's 'B' Short-term IDR, 'D/E' Individual Rating, '5' Support Rating and Support Rating Floor 'No Floor'. Fitch has withdrawn the ratings as Norvik has chosen to stop participating in the rating process. Therefore Fitch will no longer have sufficient information to maintain the ratings. Accordingly, Fitch will no longer provide rating or analytical coverage for Norvik Banka. The ratings reflect weak operating performance, notably deteriorated asset quality and moderate provisioning level. At the same time, the bank does not have wholesale refinancing needs and the deposit base has been growing. The revision of the Outlook reflects the agency's expectation that asset quality and performance are likely to stabilize this year. Norvik recorded a small loss for 2010, which is primarily driven by high impairment charges and reduced net interest income. Asset quality remains weak, although problem loan formation seems to have stabilized in 2010. Impaired loans made up 12.2% of gross lending at end-2010. In addition, loans more than 90 days overdue, but not impaired, made up an additional 10.1%. Reserve coverage remains low: coverage of impaired loans was 57% and together with loans 90+ days overdue, only 32%. The bank's deposits, both residents' and non-residents', stabilized in 2009 and recovered strongly during 2010. During 2009, the bank repaid about EUR60 million of debt and now has no outstanding wholesale obligations, including interbank deposits. Liquidity is strong: at end-2010, cash and interbank placements, excluding obligatory reserves, covered 34% of customer deposits. The bank reported a total capital ratio (CAR) of 11.8% and a Tier 1 ratio of 11.7% at end-2010, which should be viewed in the context of a large proportion of NPLs uncovered by reserves. Shareholders are reportedly ready to contribute new capital, if the total CAR falls below 10%. ================= L I T H U A N I A ================= LITHUANIAN BANKAS: Fitch Affirms LT Issuer Default Rating at 'B+' ----------------------------------------------------------------- Fitch Ratings has affirmed Lithuanian Bankas Snoras's (Snoras) ratings, including its Long-term Issuer Default Rating (IDR) of 'B+' with a Stable Outlook. Snoras's Long-term IDR reflects the support it could expect from the Lithuanian authorities in view of its relative importance to the domestic banking system. Its Individual Rating factors in the bank's weak performance, low provisioning and resulting pressure on capital. However, asset quality deterioration seems to have bottomed out, and the bank benefits from a large and stable customer deposit franchise and adequate liquidity. The bank was barely profitable in 2010, but there are moderately positive trends in operating performance driven by strengthened net interest margin and controlled costs. Asset quality materially deteriorated during the financial crisis, but seemed to stabilize in 2010. Impaired loans plus loans 90 days overdue but not impaired declined to 23.3% in 2010 compared with 25.1% at end- 2009. However, this should be viewed in the context of c.3% investment property that the bank added to its balance sheet during 2010. Liquidity is adequate, and the bank's loans/resident deposits ratio was comfortable at 87% at end-2010. There is no public debt outstanding and short-term market funding is fully covered by liquid assets. The announced LTL380 million share issue will provide significant support to Snoras's core capital and the first stage amounting to LTL368 million has already been completed. Two major shareholders will convert their subordinated debt and hybrids into equity and also contribute new equity, while a UK-based fund will become a minority shareholder. However, capital will remain tight in view of weak provisioning, with reserves covering impaired loans and exposures not impaired but more than 90 days overdue by just 17% at end-2010. Any changes to Snoras's Long-term IDR are likely to be driven by changes in Fitch's view on the sovereign's ability and propensity to provide support. The bank's Individual Rating could be downgraded if pressure on capital intensifies. An upgrade of the Individual Rating is unlikely at present. At end-2010, Snoras was the fifth largest bank in Lithuania by total assets with market shares of 9.4% in assets and of 17% in retail deposits. The bank presently is 68.1% owned by the Russian businessman Vladimir Antonov and 25.3% by the Lithuanian businessman Raimondas Baranauskas, although these stakes will fall marginally as a result of the share issue. The rating actions are as follows: -- Long-term foreign currency IDR: affirmed at 'B+'; Outlook Stable; -- Short-term foreign currency IDR: affirmed at 'B' -- Individual Rating: affirmed at 'D/E' -- Support Rating: affirmed at '4' -- Support Rating Floor: affirmed at 'B+' ===================== N E T H E R L A N D S ===================== MAGYAR TELECOM: Moody's Affirms 'B2' Corporate Family Rating ------------------------------------------------------------ Moody's Investors Service has affirmed Magyar Telecom B.V.'s B2 corporate family rating (CFR) with a negative outlook and downgraded the senior secured notes due 2016 to B2 from B1. This concludes the review process initiated on March 10, 2011. Ratings Rationale The rating action follows the successful completion of the refinancing transaction initiated March 10, 2011, whereby Invitel has (i) successfully placed EUR80 million of additional senior secured notes due 2016; and (ii) applied proceeds from the tap to repay in full the outstanding EUR69 million outstanding floating rate senior notes due 2013. Moody's notes that Invitel's debt structure is now comprised of the senior secured notes only, in the amount of EUR350 million. As a result, the B2 rating on the notes is in line with Invitel's B2 corporate family rating. Moody's also notes that the terms of the senior secured notes allow Invitel to use the remaining proceeds from the sale of Invitel International and part of Fibernet's assets for general corporate purposes including business acquisitions, beyond the 365-day limit. The affirmation of the CFR and negative outlook reflect the improvement in the company's maturity profile that results from the successful completion of the transaction, while at the same time incorporates the continuing operational and financial challenges that Invitel faces. Moody's changed the outlook on Invitel's ratings to negative from stable on Feb. 2, 2011. The principal methodology used in this rating was Global Telecommunications Industry published in December 2010. =========== R U S S I A =========== ROSTELECOM OJSC: S&P Withdraws Ratings on 5 Telcos After Merger --------------------------------------------------------------- Standard & Poor's Ratings Services said it withdrew all its ratings on five Russian telecommunications operators, namely North-West Telecom (JSC), VolgaTelecom (OJSC), Central Telecommunications Co. (OJSC), Uralsvyazinform (OJSC), and Southern Telecommunications Co. (OJSC), as well as related debt ratings. The entities have been merged into OJSC Rostelecom (BB/Stable/--) and have ceased to exist as separate legal entities. ========= S P A I N ========= BBVA FINANZIA: S&P Lowers Rating on Class C Notes to 'CCC (sf)' --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its credit rating on BBVA Finanzia Autos 1, Fondo de Titulizacion de Activos' class C notes to 'CCC (sf)' from 'BB- (sf)' and placed on CreditWatch negative its credit ratings on the class A and B notes. These rating actions follow the ongoing significant deterioration in the reported credit quality of BBVA Finanzia Autos 1's underlying portfolio. "On Feb. 1, 2010, we lowered our ratings on all classes of notes in BBVA Finanzia Autos 1 following our credit and cash flow analysis," S&P said. Based on the latest investor reports, the transaction experienced a rapid increase in defaulted loans -- defined in this transaction as loans more than 12 months in arrears -- during 2010. A rapid increase in defaulted loans may also trigger a deferral in interest payments on the class C notes. The issuer defers interest payments on this class if the cumulative amount of defaulted loans is more than 8.5% of the original collateral balance. As per the latest investor report in February 2011, the cumulative amount of defaulted loans comprised 6.28% of the original collateral balance. Since April 2010, the reserve fund has been fully depleted due to the rising default levels. Finally, as of the last payment date, the fund accumulated EUR2.7 million of principal deficiency, which is the difference between the remaining principal receipts and the amount of the notes outstanding. "We will monitor any steps the servicer takes to address this credit risk and we will conduct a credit and cash flow analysis to assess whether our ratings on the class A and B notes are appropriate. We then intend to resolve the CreditWatch placements affecting the class A and B notes following this analysis," S&P added. Finanzia Banco de Credito S.A., the consumer finance arm of Banco Bilbao Vizcaya Argentaria S.A., originated the transaction, which closed in April 2007. The revolving period ended in April 2008, one year ahead of the scheduled date, because the delinquency rate was higher than the trigger threshold level. Ratings list Class Rating To From BBVA Finanzia Autos 1, Fondo de Titulizacion de Activos EUR800 Million Asset-Backed Floating-Rate Notes Rating Lowered C CCC (sf) BB- (sf) Ratings Placed on CreditWatch Negative A AA+ (sf)/Watch Neg AA+ (sf) B A- (sf)/Watch Neg A- (sf) CAJA DE AHORROS: Fitch Downgrades Individual Rating to 'E' ---------------------------------------------------------- Fitch Ratings has downgraded Caja de Ahorros del Mediterraneo's (CAM) Long-term Issuer Default Rating (IDR) to 'BB+' from 'BBB+' with a Stable Outlook, Short-term IDR to 'B' from 'F2' and Individual Rating to 'E' from 'C'. CAM's Long-term IDR is now at its Support Rating Floor. At the same time, Fitch has maintained Caja de Ahorros de Asturias' (Cajastur) and Caja de Ahorros y Monte de Piedad de Extremadura's (Caja Extremadura) Long-term IDRs of 'A-' on Rating Watch Negative (RWN). The agency has revised the Rating Watch Evolving (RWE) on Banco de Castilla-La Mancha's (Banco CLM) 'BBB+' Long-term IDR to RWN. The rating actions follow the break-up of the integration plan for these savings banks or 'cajas' to form a mutual cross-support scheme together with Caja de Ahorros de Santander y Cantabria (not rated by Fitch). The downgrade of CAM's Individual Rating reflects that the caja will require external support as a result of low capital levels in the context of asset quality deterioration and the Bank of Spain's more stringent capital requirements. Following significant average loan growth of 30% between 2004 and 2007, CAM had built-up significant exposure to the troubled Spanish construction and real estate sector (around 28% of end-2009 loans). As per its non- consolidated accounts, CAM's impaired to total loans ratio was 8.7% at end-2010 and Fitch estimates that this would rise to around 14.5% if gross foreclosed assets are included. Impaired loans and foreclosed assets are 62% and 28% covered by reserves, respectively. Other challenges CAM faces include a substantial decline in operating profitability in 2010, mainly as a result of a sharp narrowing of its net interest margin, reflecting the low interest rate environment and high cost of the wholesale funding sources on which it is reliant. Fitch expects funding pressures on CAM to persist as the wholesale funding markets remain closed for many Spanish issuers. Capital levels are tight with a regulatory core capital ratio of 5.8% at end-June 2010. The agency believes support could be forthcoming through a capital injection by the government's Fund for Orderly Bank Restructuring and/or a merger with a stronger and larger institution. The former is why CAM's IDR is at the Support Rating Floor of 'BB+'. The maintenance of the RWN on Cajastur's and Caja Extremadura's IDRs reflects the challenges of operating in Spain's weak economic environment. Furthermore, there has been significant consolidation in the caja sector and both these entities are now small relative to other players. Fitch believes consolidation of the sector is essential and it welcomes the Spanish government's drive to achieve this. Fitch recognizes that reaching agreement on the terms of mergers and integration plans is not easy but the agency believes this must be achieved in a short period of time. Failure to integrate into a larger group in the short term would result in a downgrade of Cajastur's and Caja Extremadura's Long- term IDRs and Individual Ratings. Banco CLM's IDRs are driven by the institutional support of its majority shareholder, Cajastur, which holds 75% of the bank. These IDRs are notched down from those of Cajastur, which is why the RWE has been revised to RWN. Both Cajastur and Caja Extremadura continued to report sound profitability and capital levels in 2010. Their profitability has held up well with net interest margins declining moderately. Cajastur and Caja Extremadura's regulatory core capital ratios were 8.6% and 9%, respectively, at end-June 2010. In terms of asset quality, Cajastur's consolidated loan book has been affected by the integration of Banco CLM. However, EUR6.9 billion of Banco CLM's loan portfolio (24% of Cajastur's consolidated loan book at end-September 2010) is covered by an asset protection scheme of EUR2.5 billion as well as EUR1.2 billion in reserves built-up. Banco CLM is the spin-off of the retail banking asset and liabilities of the former Caja de Ahorros de Castilla-La Mancha, which was the subject of intervention by the Bank of Spain in March 2009. Cajastur's impaired to total loans ratio stood at a high 13.5% (including gross foreclosed assets) at end-September 2010 with coverage of 98%, reflecting the mentioned asset protection scheme and loan impairment reserves built-up at Banco CLM. Caja Extremadura's impaired to total loans ratio was 5.4% (including gross foreclosed assets) at this same date and loan impairment coverage was 85%. The rating actions are as follows: CAM: Long-term IDR: downgraded to 'BB+' from 'BBB+', removed from RWE; Outlook Stable Short-term IDR: downgraded to 'B' from 'F2', removed from RWN Individual Rating: downgraded to 'E' from 'C', removed from RWE Support Rating: affirmed at '3', removed from Rating Watch Positive (RWP) Support Rating Floor: affirmed at 'BB+', removed from RWP Senior Unsecured Debt: downgraded to 'BB+' from 'BBB+', removed from RWE Subordinated debt: downgraded to 'BB' from 'BBB', removed from RWE Upper Tier 2 subordinated debt: downgraded to 'CC' from 'BBB-', removed from RWE Preference shares: downgraded to 'C' from 'BB', removed from RWE State-guaranteed notes: affirmed at 'AA+' Cajastur: Long-term IDR: 'A-', maintained on RWN Short-term IDR: affirmed at 'F2', removed from RWN Individual Rating: 'B/C', maintained on RWN Support Rating: affirmed at '3', removed from RWP Support Rating Floor: affirmed at 'BB+', removed from RWP State-guaranteed debt: affirmed at 'AA+' Banco de Castilla-La Mancha: Long-term IDR: 'BBB+', changed to RWN from RWE Short-term IDR: 'F2', maintained on RWN Support Rating: affirmed at '2' Senior unsecured debt: 'BBB+', changed to RWN from RWE Lower Tier 2 subordinated debt: 'BBB', changed to RWN from RWE Upper Tier 2 subordinated debt: 'BBB-', changed to RWN from RWE Caja Extremadura: Long-term IDR: 'A-', maintained on RWN Short-term IDR: affirmed at 'F2', removed from RWN Individual Rating: 'B/C', maintained on RWN Support Rating: affirmed at '3', removed from RWP Support Rating Floor: affirmed at 'BB+', removed from RWP CAJA MEDITERRANEO: Faces Nationalization After Seeking Aid ---------------------------------------------------------- Victor Mallet at The Financial Times reports that Caja Mediterraneo, whose plan for a merger with three other cajas collapsed earlier, is likely to be nationalized after requesting EUR2.8 billion (US$4 billion) from the official bank rescue fund. According to the FT, the EUR2.8 billion in aid requested by Cam from the Fund for Orderly Bank Restructuring will be in the form of equity to boost Cam's capital and is expected to translate into a majority holding for the state, which will then seek to sell the bank to a private investor. Cam accounts for 4% of Spain's banking assets, the FT says. As an alternative to this forced nationalization, the central bank has been urging stronger financial institutions such as Santander, the biggest bank in the eurozone by market capitalization, to buy control of Cam, the FT discloses. Possible buyers, however, are reluctant to increase their exposure to Spanish banking at a time of economic stagnation and a moribund residential property market, the FT states. The FT notes that even if such a buyer can be found, Spanish bankers say it would demand an official asset protection scheme to limit potential losses from any deal. Caja Mediterraneo is a savings bank based in Alicante, Spain. SEGURFONDO INVERSION: Faces Liquidation Following Two-Year Closure ------------------------------------------------------------------ Atholl Simpson at Citywire reports that Spanish investment firm Inverseguros is liquidating its EUR490 million property fund Segurfondo Inversion following a two-year closure. The real estate fund closed for redemptions back in April 2009 and was one of a number of European property funds to close after they bore the full brunt of the financial crisis, Citywire recounts. According to Citywire, the Spanish group had hoped it would be able to reopen the fund by this year's April deadline. However, it did not manage to raise enough capital to meet the redemption requests and has been forced to liquidate the fund, a process which will involve it selling off its remaining properties, Citywire notes. The property fund's portfolio comprises around 60% in residential properties and 30% in offices, with the vast majority of its holdings located in and around Madrid, Citywire discloses. The fund is the latest casualty in the real estate fund sector, which has seen two other European property funds liquidated in the past few months, Citywire states. TDA CREDIFIMO: S&P Affirms 'CCC-' Rating on Class E Notes --------------------------------------------------------- Standard & Poor's Ratings Services lowered its credit ratings on TDA CREDIFIMO 1 Fondo de Titulizacion de Activos' class B, C, and D notes, and removed the class C and D notes from CreditWatch negative. "At the same time, we affirmed and removed from CreditWatch negative our rating on the class A notes, and we affirmed our rating on the class E notes," S&P said. "We have observed continuing deterioration in the credit quality of the underlying portfolio backing TDA CREDIFIMO 1. The number of loans in arrears for more than 90 days, but not yet considered as defaulted (defined as 18 months in arrears in this transaction), has stabilized in the past six months. However, the level of cumulative defaults over the original portfolio balance has increased to 6.36%, from 0.92% a year ago. This, coupled with the house price correction seen in Spain since 2008, has led to elevated weighted-average loan-to-value (LTV) ratios in the pools, and has increased our loss expectations for the pool," S&P noted. The transaction features interest-deferral triggers based on cumulative defaults. Interest on the notes is deferred if defaulted loans are more than 22% of the initial balance of the mortgages for class B, 15% for class C, and 12% for class D. "Given that the current level of cumulative defaults over the original balance is 6.36%, in our view the interest on the junior classes of notes is not likely to be postponed in the near future," S&P said. "On Jan. 18, 2011, we placed the class A notes on CreditWatch negative due to our updated counterparty criteria becoming effective. We have now removed this rating from CreditWatch negative, following our review of the transaction documents. The swap documents do not adequately mitigate counterparty risk under our updated counterparty criteria. However, we analyzed the cash flows without the benefit of the swap, and the results show that the credit enhancement of the class A notes is sufficient to maintain their current rating, even when additional stresses are applied due to the removal of the swap," according to S&P. "We have affirmed our rating on the class E notes, rated 'CCC- (sf)' since closing, due to the rating definition for this class of notes, where the payment of interest and principal is defined as ultimate," S&P related. The portfolio securitizes mortgages granted to individuals to buy residential properties, with a maximum LTV ratio of 100%. These loans were originated by Credifimo E.F.C., S.A.U. Ratings list: Class Rating To From TDA CREDIFIMO 1, Fondo de Titulizacion de Activos EUR317.3 Million Mortgage-Backed Floating-Rate Notes Rating Lowered B BBB+ (sf) A- (sf) Ratings Lowered and Removed From CreditWatch Negative C BBB- (sf) BBB (sf)/Watch Neg D B (sf) BB (sf)/Watch Neg Rating Affirmed and Removed from CreditWatch Negative A AAA (sf) AAA (sf) Watch Neg Rating Affirmed E CCC- (sf) =========================== U N I T E D K I N G D O M =========================== DIXONS RETAIL: Moody's Puts 'Ba3' Rating on Review for Downgrade ---------------------------------------------------------------- Moody's Investors Service has placed on review for possible downgrade the long-term ratings of Dixons Retail plc, including the company's Ba3 corporate family rating (CFR), senior unsecured rating and probability of default rating. Ratings Rationale "The rating action follows the announcement by Dixons of a weaker than expected operational performance, reflected in an expected profit before tax of approximately GBP85 million for the full year ending April 2011," said Yasmina Serghini-Douvin, a Moody's Assistant Vice President-Analyst and lead analyst for Dixons. Moody's rating review will focus on the strategies of Dixons to reverse its operational performance as well as its expected pace of de-leveraging given the continued weakness of its sales in its core market in the UK & Ireland, compounded by the depressed situation in southern Europe and increased costs in the Nordic region. In this respect, Moody's review will examine management initiatives for recovering profit and the likelihood of an exit from Spain (and its related costs), where the business is loss- making. Finally, the review will include an assessment of the company's liquidity profile that remains reliant on internally generated cash flows as well as access to a covenanted revolving credit facility, necessary to accommodate intra-year working capital swings. Last Rating Action and Previous Methodology Moody's last rating action on Dixons was implemented on June 29, 2010, when the rating agency changed the outlook on the ratings to stable and upgraded the company's long-term senior unsecured bond rating to Ba3 from B1. The principal methodology used in rating Dixons was "Moody's Global Retail Industry Methodology", which was published in December 2006 and is available on www.moodys.com. Headquartered in Hemel Hempstead, England, Dixons Retail plc is one of Europe's leading specialist consumer electrical retailers. It posted revenues of GBP8.5 billion for the fiscal year ending 1 May 2010. ETIC SOLUTIONS: Winding-Up Petition Set to Be Heard on April 14 --------------------------------------------------------------- Clare Weir at Belfast Telegraph reports that ETIC Solutions, the company run by Francois de Dietrich, is being liquidated. According to Belfast Telegraph, PricewaterhouseCoopers is now asking anyone who had dealings with ETIC Solutions, which had offices in Londonderry and Ballybofey in Donegal, or Mr. de Dietrich, to contact them after being appointing liquidators to the firm. Last month, the Financial Services Authority (FSA) was granted permission to appoint provisional receivers in the High Court in a bid to protect investors, Belfast Telegraph recounts. The FSA earlier obtained court orders to stop any unauthorized activity, freeze GBP20 million, and prevent ETIC from making payments, Belfast Telegraph relates. An application to have ETIC Solutions wound up is due to be heard on April 14, Belfast Telegraph discloses. In January, Mr. de Dietrich, who was accused of allegedly operating an illegal Ponzi scheme, was ordered to serve an 18- month prison sentence after he failed to comply with a court order insisting he reveal where his assets were held, Belfast Telegraph discloses. He dodged court and police were unable to trace him since, although he released a statement claiming the firm was above board and he would repay all cash owed, Belfast Telegraph states. According to Belfast Telegraph, a Derry man involved with the company has been listed as bankrupt through a creditor's petition. Belfast Telegraph relates that in 2008, David Kavanagh, described in court papers as a "company director", said ETIC Solutions was "an umbrella company which services the tourism and hospitality industry with hotel consultancy and management, chef recruitment, marketing, PR and events." "ETIC and Francois de Dietrich were performing regulated activity without our authorization. If the court finds they were offering financial services without our authorization, people that invested money with ETIC and/or de Dietrich will not be able to take a complaint to the Financial Ombudsman Service or have access to the Financial Services Compensation Scheme," Belfast Telegraph quotes the FSA as saying. ETIC Solutions was based in Donegal, Northern Ireland. HMV GROUP: Issues Fifth Profit Warning; Covenant Tests Moved ------------------------------------------------------------ Ed Hammond at The Financial Times reports that HMV Group plc issued its fifth profit alert since last September, warning that trading difficulties would cause profits to drop to about GBP30 million for the year. The FT relates that HMV, which has been struggling to reduce its GBP130 million debt burden, also confirmed that it had struck an agreement with lenders to push back tests over its banking covenants. "While negotiations regarding amended facilities continue, the group is pleased to report that its lenders have agreed to move the measurement period for all relevant financial covenant tests from the 12 months ending April 30, 2011, to the 12 months ending July 2, 2011," the FT quotes HMV as saying. According to the FT, the company added on Tuesday that its banking facilities remained fully available to it and that discussions with lenders were "constructive." As reported by the Troubled Company Reporter-Europe on March 29, 2011, Bloomberg News said that HMV is negotiating with lenders after saying it probably won't meet some covenant tests next month Bloomberg discloses. Sales have been dropping as Internet retailers and supermarkets compete for a share of the declining CD and DVD markets, Bloomberg rdisclosed. United Kingdom-based HMV Group plc is engaged in retailing of pre- recorded music, video, electronic games and related entertainment products under the HMV and Fopp brands, and the retailing of books principally under the Waterstone's brand. The Company operates in four segments: HMV UK & Ireland, HMV International, HMV Live and Waterstone's. HMV International consists of HMV Canada, HMV Hong Kong and HMV Singapore. Waterstone's is a bookseller, which operates through 314 stores and a transactional Web site for the sale of both physical and e-books for download. The Company has operations in seven countries, with principal markets being the United Kingdom and Canada. Its retail businesses operate through 417 stores in the United Kingdom, Canada, Hong Kong and Singapore. On Jan. 29, 2010, the Company completed the acquisition of MAMA Group Plc. Its subsidiaries include HMV Canada Inc, HMV Guernsey Limited, HMV Hong Kong Limited and HMV (IP) Limited. MCINERNEY HOLDINGS: Administrators Appointed to Seven Companies --------------------------------------------------------------- Manchester Evening News reports that administrators at KPMG have been appointed to seven companies in the UK arm of McInerney Holdings at the request of the company's directors. According to MEN, the seven companies in administration are McInerney Group, McInerney Homes, Alexander Developments (North East), Lancing Homes, Gold Homes (The Wave), William Hargreaves and Bowey Homes. Between them, the companies employ 161 staff, including 82 in Wigan, and 14 staff have already been made redundant at William Hargreaves, MEN discloses. "The economic downturn, particularly in respect of the UK residential property market, has had a severe detrimental impact on the group's cash flow therefore limiting its ability to trade without substantial additional finance," MEN quotes Paul Dumbell, director at KPMG Restructuring, as saying. "Our overriding objective is to ensure that work on the majority of the live private development sites is able to continue in order to maximize value in the interests of all the creditors." MEN relates that administrators intend to transfer 10 development sites -- including ones in Warrington and Newton Heath -- to a solvent company within the group, Ludgate Hill Developments, to allow them to be developed and maximize return to creditors. The other 22 sites -- including ones in Warrington, Northwich, Blackburn and Darwen -- are in the hands of administrators, MEN notes. The administrators are now conducting a two-week consultation with staff over their transfer to other divisions of the group, MEN says. McInerney Holdings is a property developer based in Wigan. McInerney, which also has offices in Durham, Leeds, Wolverhampton and Northampton, is currently developing 32 sites and working on 13 social housing projects across the north and the Midlands. ODDBINS PLC: In Administration; Deloitte Seeks Potential Buyers --------------------------------------------------------------- BBC News reports that Oddbins has gone into administration, but all of its 89 stores will remain open for now. According to BBC, administrators Deloitte said they were hopeful of selling Oddbins as a going concern and had been contacted by "a number" of interested parties. Oddbins tried to avoid administration by getting creditors to accept lower repayments, but one of the biggest creditors, HM Revenue and Customs, refused, BBC recounts. "We will continue to trade the company while seeking a sale as a going concern. Employees will continue to be paid and will be fully briefed," BBC quotes Lee Manning, one of the newly-appointer administrators, as saying. As reported by the Troubled Company Reporter-Europe on April 4, 2011, Press Association said that Oddbins, which has 89 stores left in the UK after shutting nearly 40 stores recently, has been under pressure amid competition from supermarket chains and falling consumer confidence. It is understood HMRC was owed GBP8 million by Oddbins, accounting for around 30% of the company's debt, Press Association disclosed. The company said a "significant" majority of creditors clearly wanted Oddbins to continue trading, but HMRC's vote was heavily weighted and tipped the outcome, according to Press Association. The company needed 75% of creditors to back the deal, Press Association noted. Oddbins sells wine, spirits and other related products. The Head Office is in Wimbledon, London, and the company has over 227 branches spread across the UK, Ireland and France. ROMAG: Business & Assets Sold to Gentoo Group Subsidiaries ---------------------------------------------------------- Jonathan Russell at The Telegraph reports that Romag has collapsed into administration two months after it suspended trading in its shares. According to The Telegraph, the company said it had been unable to secure funding needed to continue trading and had appointed Deloitte as administrator. Romag's business and assets have been sold to subsidiaries of housing group Gentoo, who until recently was a customer of Romag, The Telegraph discloses. The Telegraph relates that the company said it was unlikely there would be any return to shareholders from the sale of its assets to Gentoo Group subsidiaries, Ask the Genie and Ask Genie. In a statement, Deloitte said the deal with Gentoo has helped save over 160 jobs, The Telegraph notes. Romag was an AIM-listed solar power group. The company also produced bullet proof and blast proof specialist glass. SIGNUM VERMILLION: Moody's Cuts Rating on US$32-Mil. Notes to 'B3' ------------------------------------------------------------------ Moody's Investors Service has downgraded the ratings of notes issued by Signum Vermillion Limited. The notes affected by the rating action are: Issuer: Signum Vermillion Limited Series 2007-02 * Series 2007-02 USD 32,000,000 Variable Rate Credit-Linked Notes Linked to an Arithmetic Basket of Credits due 2012, Downgraded to B3; previously on Apr 17, 2009 Upgraded to B2. Ratings Rationale The transaction represents a repackaging of collateral issued by Goldman Sachs Group Inc, currently rated A1. The repack note is also credit linked to a basket of eight corporate reference entities. The Issuer sells protection on the basket to Goldman Sachs International, guaranteed by Goldman Sachs Group Inc, under a credit default swap. During the life of the deal Goldman pays the interest under the Notes and the Issuer pays the interest on the collateral to Goldman. If there is a credit event, the relevant portion of collateral will be given to Goldman and the Notes will be written down. Today's rating action is a response to the downgrade of Dynegy Holdings Inc. to Caa3 from Caa2. This is one of the eight equally weighted reference entities to which these notes are credit- linked. The principal methodology used in this rating was "Moody's Approach to Rating Repackaged Securities" published in April 2010. 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 this transaction in the past six months. ********* 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. Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Psyche A. Castillon, Julie Anne G. Lopez, Ivy B. Magdadaro, Frauline S. Abangan and Peter A. Chapman, Editors. Copyright 2011. 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 * * *