/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/110421.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 Thursday, April 21, 2011, Vol. 12, No. 79 Headlines B E L G I U M ONTEX IV SA: Moody's Assigns 'Ba3' Rating to Senior Secured Notes E S T O N I A LUTERMA AS: Declared Bankrupt by Harju County Court G E R M A N Y AAREAL CAPITAL: Fitch Lifts Rating on Hybrid Securities to 'BB-' TALISMAN-6 FINANCE: Moody's Cuts Rating on Class A Notes to 'Ba2' I R E L A N D QUINN GROUP: Sean Quinn Blames Woes on Over-Reliance of Banks * IRELAND: To Publish Revised Bankruptcy Laws in First Qtr. 2012 I T A L Y PARMALAT SPA: Milan Court Acquits Four Banks K A Z A K H S T A N BANK CENTERCREDIT: Moody's Cuts LT Foreign-Currency Deposit Rating N E T H E R L A N D S IFCO SYSTEMS: Moody's Upgrades Corporate Family Rating to 'Ba1' S W E D E N SAAB AUTOMOBILE: Has Deal With Financiers on Liquidity Crisis U N I T E D K I N G D O M CONGREGATIONAL & GENERAL: S&P Affirms 'BB+' Insurer Rating DEEJAK CONSTRUCTION: Goes Into Administration FISH HOUSE: Put Up for Sale Following Administration ITV PLC: S&P Upgrades Long-Term Corporate Credit Rating to 'BB' LANDSBANKI GUERNSEY: Liquidators Appeal Ruling on Depositor Status MONTPELLIER MARKETING: Bad Debt Prompts Administration VEDANTA RESOURCES: Moody's Keeps Review on 'Ba2' Rating * UK: Companies in Financial Distress Up 15%, Begbies Traynor Says U Z B E K I S T A N ALOKABANK JOINT-STOCK: Moody's Affirms 'E+' BFSR; Outlook Stable QISHLOQ QURILISH: Moody's Affirms 'E+' BFSR; Stable Outlook X X X X X X X X * Upcoming Meetings, Conferences and Seminars ********* ============= B E L G I U M ============= ONTEX IV SA: Moody's Assigns 'Ba3' Rating to Senior Secured Notes ----------------------------------------------------------------- Moody's Investors Service has assigned a definitive Ba3 rating to the EUR600 million senior secured notes maturing in 2018 (split into a EUR320 million fixed rate tranche and a EUR280 million floating rate tranche) and a B3 rating to the EUR235 million senior unsecured notes due 2019. Ratings Rationale Moody's definitive ratings on these debt obligations confirm the provisional ratings assigned on March 21, 2011. The terms and conditions of Ontex' new financing package are in line with what Moody's expected in its last rating action. Moody's notes however that the company decided to up-size the senior secured notes by EUR30 million compared to the initial amount at the time of the bond launch, leading to minor changes in the assigned LGD ranges and point estimates of the rated instruments. The notes proceeds have been used to redeem obligations under the EUR600 million existing credit facility, to repay a vendor loan note of EUR163 million (incl. accrued interest) with the remainder used to cover transaction related fees and expenses and to bolster the group's cash position. The B1 Corporate Family Rating of Ontex reflects (i)the company's strong market position in the production of private-label hygienic disposables; (ii) its solid relationships with major European retailers; (iii) stable market fundamentals in the discretionary personal care industry; and (iv) an improved cost base on the back of successful restructuring and efficiency enhancement initiatives over recent years. The B1 CFR also reflects Ontex's highly leveraged capital structure with initial leverage pro forma the recapitalization in excess of 5.5x Debt/EBITDA (as adjusted by Moody's), which Moody's assumes to improve over 2011 only gradually. More fundamentally, the CFR also considers (i) Ontex's limited size and its narrow product focus; (ii) the price-competitive nature of the industry. In addition, input price management is a major challenge as only a minor proportion of Ontex's contracts contain automatic pass- through mechanisms, leaving the company exposed to individual negotiations with its customers. The rating would likely encounter upward pressure if the company were to manage to improve and sustain leverage, in terms of debt/EBITDA, below 4.5x on the back of (i) further profitability improvements, such as EBITA margins approaching the mid-double digits on a sustainable basis; and (ii) continued positive free cash flow generation, to be applied to the reduction of net debt. The rating could come under negative pressure if: (i) Ontex's leverage, in terms of debt/EBITDA, were to remain materially above 5.5x; (ii) its free cash flow were to enter negative territory; or (iii) the company's profitability were to decline, reflected by EBITA margins falling into single digits. Adjustments: Issuer: Ontex IV S.A. -- Senior Secured Regular Bond/Debenture, Downgraded to LGD3, 39% from LGD3, 38% -- Senior Unsecured Regular Bond/Debenture, Downgraded to LGD6, 90% from LGD5, 89% Assignments: Issuer: Ontex IV S.A. -- Senior Secured Regular Bond/Debenture, Assigned a range of 39 - LGD3 to Ba3 -- Senior Secured Regular Bond/Debenture, Assigned a range of 39 - LGD3 to Ba3 -- Senior Unsecured Regular Bond/Debenture, Assigned a range of 90 - LGD 6 to B3 The principal methodology used in rating Ontex IV S.A. was the Global Packaged Goods Industry Methodology, published July 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Ontex, based in Zele, Belgium, is the market-leading manufacturer of private-label hygienic disposables in Europe, with products including baby diapers, adult incontinence products and femcare. With 12 production facilities in eight countries, the company generated revenues of approximately EUR1.2 billion in 2010. Following the secondary buyout from Candover, Ontex's majority shareholders are a consortium of funds controlled by Goldman Sachs and TPG. ============= E S T O N I A ============= LUTERMA AS: Declared Bankrupt by Harju County Court --------------------------------------------------- Toomas Hobemagi at Baltic Business News, citing Aripaev, reports that Luterma, the holding company of businessman Oliver Kruuda that only a year ago owned Kalev confectionery industry and Estonia's largest dairy Tere, was declared bankrupt by Harju county court on Tuesday. The company was sold Norway's Orkla last year for EUR33 million, BBN recounts. According to BBN, there is also a big question mark above Tere since its shares have been moved into a bank account of Nordea Pank. Mr. Kruuda himself claims it was a move to protect the company from creditors, BBN states. The court found that Luterma owed EUR37.5 million and although its books show that it has EUR53 million in assets, most of it is dubious such as EUR40 million that it is claiming from Alta Food, BBN discloses. Luterma's bankruptcy application was filed by Swedbank and Tartu Vesi, BBN relates. Headquartered in Harjumma, Estonia, AS Luterma, together with its subsidiaries, engages in the manufacture and sale of foodstuffs; real estate development; and media, publishing, and printing businesses. Its products include chocolate bars and candies, pastries, biscuits, skimmed milk, milk powder, cream, flour mixes, chewing candy and toffee, and butter, as well as milk chocolate with hazelnuts and almonds. ============= G E R M A N Y ============= AAREAL CAPITAL: Fitch Lifts Rating on Hybrid Securities to 'BB-' ---------------------------------------------------------------- Fitch Ratings has affirmed Aareal Bank AG's (Aareal) Long-term Issuer Default Rating (IDR) at 'A-', with Stable Outlook, and Short-Term IDR at 'F1'. The agency has also affirmed Aareal's Support Rating at '1' and its Support Rating Floor at 'A-'. Its guaranteed notes and subordinated debt have been affirmed at 'AAA' and 'BBB+', respectively. At the same time, Fitch has upgraded Aareal's Individual Rating to 'C' from 'C/D'. In line with the upgrade of the Individual Rating, Aareal's hybrid securities, issued by Aareal Capital Funding GmbH and Aareal Capital Funding LLC (Delaware), have been upgraded to 'BB-' from 'B+' and 'BB' from 'BB-', respectively. These ratings are notched from Aareal's notional unsupported IDR. "Aareal has proved resilient during the difficult market conditions it has faced in the past three years. It has remained profitable and strong management has kept asset quality deterioration under control," says Michael Dawson-Kropf, Senior Director in Fitch's Financial Institutions team." Aareal's ability to generate unsecured and long-term funding without an affiliation to a larger banking group reflects its franchise with institutional investors and is underpinned by the bank's intention to repay the EUR2 billion SoFFin-guaranteed bond maturing in June 2013, which has been retained on the bank's own books." The upgrade of the Individual Rating is also supported by Aareal's announcement that it plans to increase its share capital via a fully underwritten rights issue against cash contribution by EUR269 million. This will be used to strengthen its capital base, repay EUR75 million of the currently EUR375 million silent participation from the German Financial Markets Stabilisation Fund (SoFFin), subject to approval by BaFin and a corresponding agreement with SoFFin, and partly finance future growth. Fitch considers that the capital increase reflects Aareal's ability to strengthen its financial position despite the volatile environment and still challenging prospects for a specialized commercial real estate lender with a predominantly capital market or institutional funding base. In Fitch's view, incremental growth will have a positive impact on earnings. Profits will also benefit from lower expected risk provisioning due to a further stabilization in Aareal's core real estate markets. Fitch considers the bank's capitalization to be adequate despite the partial redemption of SoFFin's silent participation, planned loan growth and in light of prospective higher capital demands from the implementation of the Basel III capital guidelines. This primarily reflects the agency's expectation that Aareal will maintain its conservative underwriting criteria in conjunction with its increased targets for new business. Aareal's IDRs are based on Fitch's view that government support remains high for larger Pfandbrief issuers. However, there is political will in Germany, as evidenced by the recent implementation of the Restructuring Act, to reduce the implicit state support of banks in the country. This represents a potential threat for the bank's IDRs, senior and subordinated (lower Tier 2) debt ratings. In addition, the affirmation of Aareal's IDR reflects the support measures still in place at the bank, including the SoFFin capital investment of EUR300m remaining after the repayment planned from the capital raising. TALISMAN-6 FINANCE: Moody's Cuts Rating on Class A Notes to 'Ba2' ----------------------------------------------------------------- Moody's Investors Service has downgraded the Class A Notes of Talisman-6 Finance p.l.c. (amounts reflect initial oustandings): -- EUR825M Class A Notes, downgraded to Ba2 (sf); previously on Nov 30, 2009 Downgraded to Baa1 (sf) Moody's does not rate the Class X, B, C, D, E and F Notes issued by Talisman-6 Finance p.l.c. The current review action takes Moody's updated central scenarios into account, as described in Moody's Special Report "EMEA CMBS: 2011 Central Scenarios". Ratings Rationale The key parameters in Moody's analysis are the default probability of the securitized loans (both during the term and at maturity) as well as Moody's value assessment for the properties securing these loans. Moody's derives from these parameters a loss expectation for the securitized pool. Based on Moody's revised assessment, the loss expectation for the pool has increased significantly since the last review in November 2009. This is mainly driven by Moody's higher expected default rates at the loans' maturity dates with 87% of the loan pool maturing between now and January 2012. This transaction has a number of weaknesses which have contributed to the downgrade. As mentioned, a large number of loans mature in the near term and this is coupled with a high loan-to-value (LTV) ratio on many of the loans. Therefore most of the loans are expected default on their maturity date. The largest loan in pool (38% of the pool balance), which will mature in July 2011, will be very difficult to refinance or work-out due to the large loan size (whole loan of EUR426 million), the large underlying portfolio involved (161 properties) and the fact that Moody's expects no sponsor support for the loan since the sponsor is insolvent. Also, most of the loans are secured by property portfolios with major lease rollover exposures within the next four years which could place pressure on cash flows, values and sale or refinancing prospects. The Class A credit enhancement has not increased meaningfully since closing and coupled with the decrease in values, results in a high note-to-value on the Class A. The transaction payment waterfall has already switched over to fully sequential which will benefit the Class A Notes as loans repay or recovery proceeds are realized. The sequential payment allocation will mitigate rating sensitivity on the Class A Notes as increased credit enhancement from loans that repay will offset the expected decrease in credit enhancement from losses that Moody's expects to be allocated to the Class F and E Notes within the next two years. Moody's analysis reflects a forward-looking view of the likely range of collateral performance over the medium term. From time to time, Moody's may, if warranted, change these expectations. Performance that falls outside an acceptable range of the key parameters may indicate that the collateral's credit quality is stronger or weaker than Moody's had anticipated during current review. Even so, deviation from the expected range will not necessarily result in a rating action. There may be mitigating or offsetting factors to an improvement or decline in collateral performance, such as increased subordination levels due to amortization and loan re- prepayments or a decline in subordination due to realized losses. Primary sources of assumption uncertainty are the current stressed macro-economic environment and continued weakness in the occupational and lending markets. Moody's anticipates (i) delayed recovery in the lending market persisting through 2012, while remaining subject to strict underwriting criteria and heavily dependent on the underlying property quality, (ii) values will overall stabilize but with a strong differentiation between prime and secondary properties, and (iii) occupational markets will remain under pressure in the short term and will only slowly recover in the medium term in line with the anticipated economic recovery. Overall, Moody's central global scenario remains 'hooked-shaped' for 2011; Moody's expects sluggish recovery in most of the world's largest economies, returning to trend growth rate with elevated fiscal deficits and persistent unemployment levels. Moody's Portfolio Analysis Talisman-6 Finance p.l.c. closed in April 2007 and represents the securitisation of initially nine commercial mortgage loans originated by ABN AMRO Bank N.V. The loans are secured by first- ranking mortgages over initially 276 commercial properties located in Germany. Since closing, with the exception of four small property disposal under the Orange Loan, there have been no changes in the portfolio composition. The remaining 272 properties in the pool are predominantly retail (49.6%, mainly retail boxes with some high street retail) and mixed-use (27%, predominantly multi-family). The Cherry and Kiwi Loans (together 6.8% of the pool) are in payment arrears and both are in special servicing. Furthermore, the Cherry Loan was accelerated and insolvency proceeding opened in January 2010. The Mango Loan (8.4% of the pool) is in default due to an LTV covenant breach. For all three of these loans, the sale of the underlying properties is the stated work-out strategy of the servicer/special servicer. As a result of the continued payment default under the Cherry Loan there has been a liquidity draw every quarter since the Aril 2008 IPD. The liquidity draw on the January 2011 IPD amounted to EUR 2.42 million. Following the default of the Cherry Loan, there has also been an appraisal reduction adjustment to the liquidity facility after the properties securing the Cherry loan were re- valued. The Class F Notes (not rated by Moody's), which are subject to an available funds cap mechanism, have not received interest payment or have only received partial interest payment since the January 2009 IPD. Based on Moody's property value assessment, the weighted average securitized LTV is 116% and the overall weighted average whole loan leverage is 124%. Compared to this, the underwriter weighted average securitized LTV is 87.1% and the whole loan LTV is 92.2%. Four of the five loans where the properties have been re-valued during 2010 have an underwriter LTV in excess of 100%. The largest loan in the portfolio, the Orange Loan (38% of the pool and EUR 426 million whole loan balance) matures in July 2011. It is secured by 161 properties which are mainly retail boxes, grocery stores and some high street shops. The vacancy rate has increased further since Moody's last review. The current vacancy rate is 21.4% compared to 15.6% in November 2009 and 7% at closing. Consequently property portfolio cash flows have deteriorated since closing as well. Furthermore 13% of the leases (by rental income) will expire by the end of 2011 with another 37% of the leases expiring during 2012 and 2013. The portfolio hasn't been re-valued since closing. Moody's whole loan LTV for this loan at maturity is 135%. In Moody's opinion this loan will default at its maturity date driven by its high leverage and large size. The Peach Loan (14.0% of the portfolio) also matures in July 2011. It is secured by 25 mainly retail box properties. The weighted average lease term to expiry is 5.8 years and vacancy levels and cash flows have been relatively stable since closing. Moody's whole loan LTV at maturity is 105%. Moody's also expects this loan to default at its maturity date however Moody's expects some sponsor support with respect to this loan and that there is high chance that this loan could be worked with no or minimal loss. Portfolio Loss Exposure: Moody's expects a high amount of losses on the securitized portfolio, stemming mainly from the performance and the refinancing profile of the securitized portfolio. Given the default risk profile and the anticipated work-out strategy for defaulted and potentially defaulting loans, these expected losses are likely to crystallize mainly towards the end of the transaction term. The legal final maturity of the Notes is only in October 2016 and the tail period after the longest dated loan (taking into account extension options) is almost three years therefore the special servicer will have time to work-out current and future defaulting loans in this transaction. However, in the case of the Cherry Loan which has already been accelerated and the Kiwi Loan, Moody's expects a faster work-out and expects losses to be allocated to the Class F and E Notes within the next two years. Rating Methodology The principal methodology used in this rating was "Update on Moody's Real Estate Analysis for CMBS Transactions in EMEA" published in June 2005. 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. The updated assessment is a result of Moody's on-going surveillance of commercial mortgage backed securities (CMBS) transactions. Moody's prior review is summarized in a Press Release dated Nov. 30, 2009. The last Performance Overview for this transaction was published on March 24, 2011. ============= I R E L A N D ============= QUINN GROUP: Sean Quinn Blames Woes on Over-Reliance of Banks ------------------------------------------------------------- Barry O'Halloran at The Irish Times reports that Sean Quinn has blamed over-reliance on the banks and their economic predictions for Quinn Group's problems. The Irish Times relates that Mr. Quinn on Tuesday issued his first statement since he lost control of his manufacturing and insurance business, Quinn Group, to a receiver last week. Anglo Irish Bank has since appointed Kieran Wallace of KPMG as share receiver to Quinn Group ROI Ltd. last Thursday, The Irish Times recounts. The group owes EUR2.88 billion to the bank, The Irish Times discloses. According to The Irish Times, Mr. Quinn said "our mistake was to place an overreliance on the Irish banking system and the many predictions for continued sustained growth in the Irish economy from some of the country's leading financial services experts". The debt to Anglo relates mainly to the fact that he bought its shares in 2008, shortly before the financial crisis and the bank's subsequent collapse, The Irish Times notes. Under a five-year plan hammered out between Anglo and a range of other creditors, mainly bondholders, who are owed EUR1.28 billion, the bank will get a majority stake in the group's manufacturing operations, while other creditors will get a 25% share, The Irish Times says. Quinn Group ROI controls its cement, building materials, glass and other manufacturing businesses in Ireland and Britain through its ownership of Quinn Group, an operating entity registered in Northern Ireland. * IRELAND: To Publish Revised Bankruptcy Laws in First Qtr. 2012 ---------------------------------------------------------------- Joe Brennan at Bloomberg News reports that Irish Prime Minister Enda Kenny told the Dublin parliament on Tuesday that Ireland's government will publish revised bankruptcy laws in the first quarter of 2012. According to Bloomberg, Mr. Kenny's coalition government promised when it was formed last month to fast-track changes in laws requiring bankrupted individuals to wait 12 years before they are discharged from their debts. ========= I T A L Y ========= PARMALAT SPA: Milan Court Acquits Four Banks -------------------------------------------- BBC News reports that four banks have been acquitted by a court in Milan, Italy, over accusations they did not take adequate steps to prevent Parmalat from committing fraud. Prosecutors had wanted to seize a total of EUR120 million -- GBP105 million; US$171 million -- from Morgan Stanley, Deutsche Bank, Citigroup and Bank of America. They were accused of helping to mislead investors. The banks had denied the criminal charges, claiming that they had also been victims of the Parmalat fraud. Parmalat collapsed in 2003 with EUR14 billion of debts. Its founder and former chief executive, Calisto Tanzi, was sentenced to 18 years in jail in December, for criminal association and fraudulent bankruptcy. "The Milan court's judgment confirms unequivocally that Citi and its employees did not have any involvement in the execution of the most significant fraudulent bankruptcy in Italy," Citigroup said in response to the final ruling in the two-year court case, according to BBC. About Parmalat S.p.A. Headquartered in Milan, Italy, Parmalat S.p.A. -- http://www.parmalat.net/-- sells nameplate milk products that can be stored at room temperature for months. It also has about 40 brand product lines, which include yogurt, cheese, butter, cakes and cookies, breads, pizza, snack foods and vegetable sauces, soups and juices. Parmalat S.p.A. and its Italian affiliates filed separate petitions for Extraordinary Administration before the Italian Ministry of Productive Activities and the Civil and Criminal District Court of the City of Parma, Italy on Dec. 24, 2003. Dr. Enrico Bondi was appointed Extraordinary Commissioner in each of the cases. The Parma Court declared the units insolvent. On June 22, 2004, Dr. Bondi, on behalf of the Italian entities, sought protection from U.S. creditors by filing a petition under Sec. 304 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 04-14268). Parmalat's U.S. operations filed for Chapter 11 protection on Feb. 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, represented the U.S. Debtors. When the U.S. Debtors filed for bankruptcy protection, they reported more than US$200 million in assets and debts. The U.S. Debtors emerged from bankruptcy on April 13, 2005. Three special-purpose vehicles established by Parmalat S.p.A. -- Dairy Holdings Ltd., Parmalat Capital Finance Ltd., and Food Holdings Ltd. -- commenced separate winding up proceedings before the Grand Court of the Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll (Cayman) Ltd. were appointed liquidators in the cases. On Jan. 20, 2004, the Liquidators filed a Sec. 304 petition (Bankr. S.D.N.Y. Case No. 04-10362). Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq., at Janvey, Gordon, Herlands Randolph, represented the Finance Companies in the Sec. 304 case. The Honorable Robert D. Drain presided over the Parmalat Debtors' U.S. cases and Sec. 304 cases. In 2007, Parmalat obtained a permanent injunction in the Sec. 304 cases. =================== K A Z A K H S T A N =================== BANK CENTERCREDIT: Moody's Cuts LT Foreign-Currency Deposit Rating ------------------------------------------------------------------ Moody's Investors Service has downgraded the long-term foreign- currency deposit rating of Bank CenterCredit (BCC) to B1 from Ba3. BCC's global long-term local and foreign-currency senior unsecured debt ratings were also downgraded to B2 from Ba3 and B1, respectively, and its junior subordinated foreign-currency debt rating to Caa1(Hyb) from B3(Hyb). Concurrently, Moody's assigned B1/Not Prime local-currency deposit ratings to the bank. The rating actions follow Moody's assessment of BCC's audited financial statements for 2010, prepared under IFRS. At the same time, BCC's Not Prime short-term foreign-currency deposit ratings and its E+ stand-alone bank financial strength rating (BFSR) were affirmed, but the BFSR was remapped to B2 on the long-term scale from B1. The outlook on the BFSR ratings is stable, while the deposit and debt ratings carry a negative outlook. Ratings Rationale The downgrade of BCC's debt and deposit ratings reflects weakening of the bank's stand-alone financial rating (BFSR) within the E+ category, now mapping to a long-term rating scale of B2. "The deterioration of the bank's financial profile stems primarily from the considerable weakening of the bank's capital position over the recent period due to ongoing impairment in the loan book," says Semyon Isakov, a Moody's Assistant Vice-President and lead analyst for the bank. "In addition, a material deterioration of BCC's net interest margin in 2010 led to negative operating efficiency in the most recent financial quarter, which prevented it from absorbing mounting credit losses and created additional negative pressure on the bank's capital adequacy," adds Mr. Isakov. At end-February 2011, BCC's level of overdue loans increased to 20.2% of its gross loan book while the level of loan loss reserves was 14.9% in accordance with regulatory data. In addition, Moody's notes that KZT64.6 billion (US$438 million) or 8.1% of the gross loan book was restructured, otherwise these loans would be past due or impaired in accordance with the bank's IFRS as at YE2010. In 2010, BCC's net interest margin shrank considerably to 1.2% (2009: 3.5%, 2008: 4.7%), reflecting the high level of non- performing loans, declining yields in the sector and the negative result from excessive liquidity as the customer deposit base grew rapidly compared to the loan book. In the second half of 2010, weak net interest margin negatively impacted BCC's overall operating performance, resulting in losses at the pre-provision level. Given the above-mentioned concerns, Moody's considers the 7.6% equity-to-assets ratio -- as reported under the local regulatory standards -- to be weak against the background of ongoing negative pressure stemming from the bank's currently negative operating performance and high level of problem loans in the loan book that could potentially lead to a further notable deterioration in the bank's capital profile. BCC is currently planning to address the above-mentioned issues by: (i) targeting 10% growth of the loan book in 2011; (ii) decreasing the level of expensive customer funding; (iii) investing its low-yield liquid assets in assets with higher returns and (iv) is anticipating recovery in already created loan loss reserves. However, Moody's said that it has yet to see the positive effect from these measures given the challenges faced by Kazakh banks, i.e. subdued demand for new loans, low interest rates due to strong competition and excessive liquidity in the sector, and lack of clear evidence of recovery in the value of underlying assets. Notwithstanding the above-mentioned concerns, Moody's notes that BCC's stand-alone financial profile is underpinned by a healthy liquidity profile due to the high cushion of liquid assets(cash and government bonds) that amounted to KZT462 billion(US$3.1 billion) or 37.7% of the bank's IFRS total assets at YE2010. The negative outlook on BCC's debt and deposit ratings reflects ongoing pressure on the bank's stand-alone financial profile that could, in the short to medium term, warrant a downwards adjustment in BCC's mapping of the E+ BFSR to the long-term rating scale by one notch if the bank's capital position continued to deteriorate. The assigned B1/Not Prime local-currency deposit ratings are at the same level with BCC's foreign-currency deposit ratings and are based on the bank's E+ BFSR( now mapping to a long-term rating scale of B2) and low probability of systemic support. 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. Headquartered in Almaty, Kazakhstan, BCC reported -- under IFRS -- total assets of KZT1.224 trillion (US$8.3 billion) and shareholders' equity of KZT84.7 billion (US$ 575 million). Net loss for 2010 was KZT31 billion (US$208 million). ===================== N E T H E R L A N D S ===================== IFCO SYSTEMS: Moody's Upgrades Corporate Family Rating to 'Ba1' --------------------------------------------------------------- Moody's Investors Service upgraded IFCO Systems N.V. (IFCO) Corporate Family Rating (CFR) to Ba1 from Ba3 and Probability of Default Rating (PDR) to Ba1 from Ba3. Concurrently, Moody's upgraded to Ba1 from Ba3 the rating on IFCO's EUR200 million senior secured notes due 2016. The outlook on all ratings is stable. Ratings Rationale The ratings upgrade follows the announcement of the successful acquisition of the majority of shares in IFCO by Brambles Limited ("Brambles", Baa1/stable), the global leader in pallet and container pooling supply chain solutions through its CHEP division. The ratings and outlook of Brambles were unaffected by the announcement. "IFCO's ratings upgrade reflects its new ownership as well as improved standalone credit metrics, demonstrated by strong performance in 2010, leading to the two notch upgrade and stable outlook," says Tanya Savkin, Moody's lead analyst for IFCO. "Although Brambles has not yet unveiled detailed plans with regards to IFCO's integration, Moody's expects IFCO should derive some benefit from the stronger credit profile of Brambles as well as potential synergies from combined businesses, particularly considering the industrial rationale underpinning the acquisition." The rating reflects current assumption that most of IFCO's EUR200 million senior secured notes due 2016 will remain outstanding, and will not be guaranteed by Brambles Bramble's ownership is likely to provide IFCO with access to the customer base of CHEP and at the same time will provide Brambles with strategic position in Returnable Plastic Containers (RPC) market. Moody's expects that IFCO will be responsible for all RPC business of the new group, including that of CHEP. The transaction will also potentially provide IFCO with larger access to capital and worldwide infrastructure to accelerate its expansion. IFCO reported revenue of US$785 million and EBITDA of USD150 million for the year ended December 2010, an increase of 6.7% and 16.0% respectively over previous year leading to growth in EBITDA margin to 19.1% in 2010 from 17.5% in 2009. The growth in sales continues to be driven by RPC business with new and existing customers across all of IFCO's key regions. Growth in Pallet Management Service (PMS) sector remained largely flat due to continued difficult economic environment in the US pallet market. Positively, EBITDA margin of PMS segment has increased to 7.6% in 2010 from 6.8% in 2009, mainly due to the effects of lower material cost. Liquidity remains satisfactory, with US$59 million cash on balance sheet and USD65 million revolving facility available, however Moody's notes that free cash flow was negative in 2010 due to increased investments required in RPCs to support the growth. The rating also continues to reflect the company's relatively small size. It is also Moody's expectation that the company will address the maturity of its revolving facility due May 2012 in a timely fashion. Moody's would consider a rating upgrade if IFCO's adjusted Debt/EBITDA ratio to fall below 2.25x and EBIT/Interest cover ratio to rise above 3.0x on a sustainable basis. Positive pressure may also result from further evidence of operational integration into Brambles beneficial to IFCO and/or financial support from Brambles. Moody's would consider a rating downgrade if IFCO's adjusted Debt/EBITDA ratio rises above 3.0x and EBIT/Interest cover ratio falls below 2.0x. The principal methodology used in rating IFCO Systems N.V. was the Global Packaging Manufacturers: Metal, Glass, and Plastic Containers Industry Methodology, published June 2009. Other methodologies used include Loss Given Default for Speculative Grade Issuers in the US, Canada, and EMEA, published June 2009. Headquartered in the Netherlands, IFCO Systems N.V. is a leading logistics services provider operating in Europe and in the Americas. =========== S W E D E N =========== SAAB AUTOMOBILE: Has Deal With Financiers on Liquidity Crisis ------------------------------------------------------------- Global Insolvency, citing Dow Jones Daily Bankruptcy Review, reports that the Swedish National Debt Office on Monday said that Saab Automobile has reached an agreement in principle with financiers regarding a solution to the company's liquidity crisis. "The information that Saab has presented to us looks good and they will now have to present us a contract that is signed," Global Insolvency quotes Unni Jerndal, a spokeswoman for Sweden's NDO, as saying. She said all conditions set by the Swedish government to reach an agreement have been met, and Saab is now working on the last details to secure the deal, Global Insolvency notes. Saab, Global Insolvency says, urgently needs fresh funds to pay its suppliers and resume production. Production came to a halt in recent weeks because of parts shortages after some suppliers stopped deliveries, Global Insolvency recounts. Global Insolvency relates that on Friday, the Swedish government granted the car maker approval to sell its property and set several conditions for the NDO to allow Saab to release its collateral. The conditions were mainly related to the expected price and the potential buyer, Global Insolvency states. According to Global Insolvency, the company is currently unable to secure external financing, since large parts of its assets are tied up as collateral for a EUR400 million (US$572.2 million) loan granted by the European Investment Bank. With an annual production of up to 126,000 cars, Saab's current models include the 9-3 (available as a convertible or sport sedan), the luxury 9-5 sedan (also available in a sport wagon), and the seven-passenger 9-7X SUV. As it prepared to separate from General Motors, Saab filed for bankruptcy protection in February 2009. A year later, in February 2010, GM sold Saab to Dutch sports car maker Spyker Cars for about US$400 million in cash and stock. =========================== U N I T E D K I N G D O M =========================== CONGREGATIONAL & GENERAL: S&P Affirms 'BB+' Insurer Rating ---------------------------------------------------------- Standard & Poor's Ratings Services said it revised its outlook on U.K.-based non-life insurer Congregational & General Insurance PLC to stable from positive. "At the same time, we affirmed the 'BB+' counterparty credit and insurer financial strength ratings on the company," S&P related. "The outlook revision reflects our view of Congregational & General's revision of its long-term strategy. From 2012, the company plans to accelerate its growth through an MGA route and retain only a very small underwriting portfolio. Although this strategy may prove to be profitable, its success is unproven and the execution risk, in our opinion, is high," S&P noted. "Furthermore, we believe that this strategy is likely to have a negative impact on the insurer's already-marginal and prospectively weakening competitive position and will increase its dependence on third-party capital to help it implement its strategy. We view these issues and potential risks as negative rating factors in the longer term as they may constrain Congregational & General's strategic direction and cause uncertainty among clients and brokers about the viability of its business," S&P continued. "In our opinion, the ratings continue to be underpinned by good capital adequacy. That said, the insurer is very small in absolute terms and its competitive position and operating performance are marginal," according to S&P. The stable outlook reflects Standard & Poor's expectation that these strategic changes will have no negative impact on Congregational & General's policyholders. "We expect that during the company's strategic realignment, capital adequacy will remain at a good level and that the company will maintain its low financial risk tolerance," S&P added. The ratings could come under downward pressure if its financial risk tolerance were to increase or if its capital or operating performance were to reduce. DEEJAK CONSTRUCTION: Goes Into Administration --------------------------------------------- The Construction Index reports that Deejak went into administration on Tuesday, resulting in the loss of 18 jobs. Group companies Deejak Construction, Deejak Builders (Rushden) and Rushden Builders Merchant (RBM) are being wound up by insolvency specialists from Begbies Traynor, according to The Construction Index. The Construction Index relates that administrators were called in on Friday and have already decided that it cannot be sold as a going concern. Just half a dozen employees have been kept on to help with finalization of accounts. Administrators are also looking to novate a handful of ongoing contracts, The Construction Index discloses. The Construction Index notes that joint administrator John Kelly said that Deejak had failed because of "a combination of lack of work and difficulty getting paid", adding: "It's a common problem with in the construction industry." Deejak is a Northamptonshire-based building company. FISH HOUSE: Put Up for Sale Following Administration ---------------------------------------------------- Lorraine Helle at Big Hospitality reports that The Fish House Hotel & Restaurant has been put up for sale after falling into administration. Big Hospitality relates that property agents Christie + Co, who have been appointed to handle the sale on behalf of the administrators, FRP Advisory, said they are looking for offers on the GBP3 million freehold and will kick off their marketing campaign next month. According to Big Hospitality, the group said it is looking to sell the site as a going concern, which will include the 100-cover restaurant, a fish bar, an 'al fresco' dining area, and 15 bedrooms. The Fish House Hotel & Restaurant is situated in Chilgrove, West Sussex. ITV PLC: S&P Upgrades Long-Term Corporate Credit Rating to 'BB' --------------------------------------------------------------- Standard & Poor's Ratings Services said it raised to 'BB' from 'B+' its long-term corporate rating and senior unsecured debt ratings on U.K. broadcaster ITV PLC. "At the same time, we affirmed our 'B' short-term corporate credit rating on ITV. We removed all ratings from CreditWatch, where they had been placed with positive implications on Jan. 27, 2011," S&P stated. "The '4' recovery rating on all of ITV's senior unsecured debt is unchanged, indicating our expectation of average (30%-50%) recovery for unsecured creditors in the event of a payment default," according to S&P. S&P noted, "The rating actions reflect ITV's 2010 results, which were significantly better than we anticipated on the back of a strong recovery in the U.K. advertising market in the second half of the year. As a result, Standard and Poor's-adjusted leverage dropped to 3.7x in 2010 on a gross debt basis, from 7.3x the previous year. Moreover, we believe that ITV will likely build up additional headroom at the current rating in 2011, given our base- case assumption of further growth in revenues and EBITDA." "As a result, we anticipate that leverage--adjusted for operating leases, pension obligations, and GBP250 million of what we consider to be excess cash--will decline toward 3x by the end of 2011," S&P related. "The current ratings are supported by our view of ITV's moderate financial policy over the medium term. We anticipate that the group's resumption of dividend payments will initially be limited, but will gradually increase over time without jeopardizing the group's financial flexibility. In addition, we factor only bolt- on acquisitions into our base-case scenario and we anticipate that sizable acquisitions would be funded with a mix of debt and equity," S&P stated. "In our view, ITV's credit metrics will likely remain commensurate with the current ratings, based on low single-digit growth in the group's revenues and EBITDA and a moderate financial policy on acquisitions and shareholder remuneration. We view a ratio of adjusted debt to EBITDA of about 3x and an adjusted ratio of free operating cash flow to debt in excess of 5% as adequate for the current rating," according to S&P. S&P could raise the rating if a stronger growth in the advertising market than we anticipate leads to growth in revenues and EBITDA, leading to an adjusted debt-to-EBITDA ratio of less than 2.5x (equivalent to a reported 1.5x), alongside a commitment from management to keep financial metrics at that level. This would require EBITDA to rise by more than 10% in 2011. "However, this is outside our base-case scenario," S&P noted. "We could lower the rating if ITV's adjusted debt to EBITDA were to rise above 3x (equivalent to a reported 2x) on a sustainable basis. We could see this happening as a result of unexpected operating setbacks or large shareholder remuneration or acquisitions," S&P added. LANDSBANKI GUERNSEY: Liquidators Appeal Ruling on Depositor Status ------------------------------------------------------------------ International Adviser reports that the liquidators of Landsbanki Guernsey have appealed against an Icelandic court decision that would mean savers in the bank were likely to get none of their money back. According to International Adviser, a statement released by Deloitte -- one of the Landsbanki Guernsey joint liquidators -- said it was challenging the ruling of the District Court of Reykjavik that gave preferential status to what are termed British and Dutch wholesale depositors. These are local authorities, universities and other institutions, International Adviser states. These wholesale depositors were given preferential status in 2009 following a meeting of a body known as the LIHF Resolution Committee, International Adviser recounts. Deloitte's statement said preferential status was established under an Icelandic Emergency Law passed in October 2008, days before Landsbanki went into administration, International Adviser notes. Landsbanki Guernsey depositors, however, are classed as "intercompany depositors" and as such are given no special treatment, International Adviser discloses. International Adviser says the challenge is being made to the Icelandic Supreme Court. There is no timetable for when the appeal will be held, according to International Adviser. As reported by the Troubled Company Reporter-Europe on Dec. 10, 2010, BBC News said Landsbanki Guernsey went into liquidation after being placed into administration in 2008, due to the collapse of its parent company. Guernsey's Royal Court agreed the former administrators be appointed as liquidators on Dec. 7, 2010, BBC News disclosed. The Guernsey Financial Services Commission said Landsbanki Guernsey had to surrender its banking license because it had insufficient capital to be licensed, BBC noted. About Landsbanki Guernsey Ltd. Landsbanki Guernsey Ltd. was subsidiary of Iceland-based financial institution Landsbanki Islands hf. MONTPELLIER MARKETING: Bad Debt Prompts Administration ------------------------------------------------------ Montpellier Marketing Communications Group Ltd. has gone into administration, thisisgloucestershire.co.uk reports. thisisgloucestershire.co.uk relates that Neil Hickling and Anthony Spicer of Smith and Williamson have been appointed as joint administrators. According to thisisgloucestershire.co.uk, Guy Woodcock, Chief Executive of MMCG Ltd Ltd., said the company had gone into administration because of a "bad debt" and he said he was now working hard to minimize the impact on creditors. A new company has been set up -- Montpellier Public Relations Ltd. -- which has taken over the former company's assets, goodwill and client base, thisisgloucestershire.co.uk discloses. All eight members of the old company have been kept on and the new firm is based at the existing headquarters in Montpellier, Cheltenham, thisisgloucestershire.co.uk notes. "Everything remains the same and we have a viable business going forward which will enable us to continue to provide services and to retain livelihoods at the company," thisisgloucestershire.co.uk quotes Neil Hickling, director at Smith & Williamson, the accountancy and financial services group, as saying. "There has effectively been a management buy-out of this business from the administrators at Smith & Williamson's restructuring and recovery division. The current management team at Montpellier is re- organizing its business and the good news is that there have been no redundancies." Montpellier Marketing Communications Group Ltd. is a Gloucestershire-based public relations and marketing firm. VEDANTA RESOURCES: Moody's Keeps Review on 'Ba2' Rating ------------------------------------------------------- Moody's Investors Service has continued to place on review for possible downgrade the Ba1 corporate family rating and Ba2 senior unsecured rating of Vedanta Resources plc. The rating view was initiated on Aug. 17, 2010, after Vedanta had announced the proposed acquisition of a controlling stake (of up to 60%) in Cairn India Ltd. (CIL) for US$9.6 billion or less. On 21st December 2010, Moody's announced the continuation of its review of Vedanta. On April 7, 2011, the seller, Cairn Energy Plc and Vedanta agreed to extend the completion date deadline from April 15 to May 20, 2011. This was as a result of further delays in the regulatory approval process. The Government of India's (GoI) final decision is still awaited and the outcome is in the hands of a special ministerial panel. Moody's notes that Vedanta reports its results for the year to March 31, 2011, on May 5, while Cairn Energy will issue an interim management statement, and usually holds its AGM for shareholders, in late May. As described in Moody's December note, the $6 billion of debt financing to be guaranteed by Vedanta Resources Plc for the transaction is in place, Additionally, Sesa Goa's open offer for CIL shares is now underway following clearance from the Securities and Exchange Board of India (SEBI). Vedanta is using its listed subsidiary, Sesa Goa Ltd. (55.7%-owned), as a funding vehicle to acquire a 20% stake in Cairn India, by drawing on its cash on hand and raising short-term funds. Nevertheless, Moody's would not be surprised if the acquisition of a majority interest in CIL failed to occur. The royalty issue between CIL and ONGC (74%-owned by GoI) had been a point of contention for some time prior to Vedanta's approach to CIL. In essence, ONGC pays the royalty on all the fields' outputs whereas its production share is only 30%. While there is a contract in place to underpin the arrangement, a change in control of CIL represents an opportunity for such contracts to be closely scrutinized. However, Vedanta's track record of negotiation suggests that it is unlikely to budge from its position and will walk away if it perceives a material change in value. The operational performance of both Vedanta and CIL has been buoyed by the continuation of strong commodity prices into Q1 2011. Crude oil was trading around $75/barrel in August 2010 and is now some $110/barrel. Moody's estimates the current EBITDA run rate for Vedanta to be around $900 million per quarter and that for CIL over $500 million per quarter. However, the CIL deal sees the complex structure of Vedanta persist, with the CIL ownership interests to be split between Sesa Goa (holding up to 20%) and an offshore SPV holding between 31- 40%. Substantial minority shareholders in both listed and un- listed subsidiaries continue to populate the Vedanta Group structure, from the UK Plc to the Indian operating companies, and in order to protect ownership levels, debt is invariably the first choice for new funds. Vedanta's strategy remains opportunistic and difficult to predict, but its track record in the execution of acquisitions and organic growth has been good. Its recent purchase of a small, part-built steelworks in Karnataka, India, for $50 million is partly in response to the growing pressures on the export of iron ore but Moody's expects Vedanta's investment in steel to grow over time. The acquisition of CIL represents a challenge for Vedanta as the risk and time profiles of the oil and gas, exploration and production sector are different from those of its hard minerals business. However, the execution risk is somewhat mitigated by the retention of existing management and the onshore location of the producing wells. Nevertheless, CIL is a larger company by market capitalization ($ 14.7 billion) than Vedanta ($ 10.1 billion) and the relative size of the transaction elevates the risks for Vedanta. Moody's notes the proposed addition of debt at the Parent company level to fund the CIL purchase and the implications this has for subordination within the Group. The balance between priority debt at operating subsidiaries and the Parent may well be better after the transaction, but this serves to highlight the thinly capitalized Parent. Furthermore, the Parent's sources of cash are unpredictable. The senior unsecured rating of Vedanta Resources Plc is currently set at one notch below the corporate family rating (CFR) and this is not expected to change. The review will conclude once the outcome of the CIL acquisition is known. Moody's expectations are for Vedanta's CFR to be lowered by one notch if Vedanta succeeds, based on the existing terms, and for the CFR to remain at its current level if the deal falls through. However, in both circumstances Vedanta's credit profile at these rating levels would be challenged. The principal methodology used in rating Vedanta is Rating Methodology on Global Mining Industry published in May 2009, and available on www.moodys.com in the Rating Methodologies sub- directory under the Research & Ratings tab. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found in the Rating Methodologies sub- directory on Moody's website. Headquartered in London, UK, Vedanta Resources plc is a metals and mining company focusing on integrated zinc, aluminum, copper, iron ore mining and commercial power generation. Its operations are predominantly located in India. It is listed on the London Stock Exchange and is 59.67% owned by Volcan Investments Ltd. * UK: Companies in Financial Distress Up 15%, Begbies Traynor Says ------------------------------------------------------------------ Red Flag Alert, which monitors a series of indicators of company distress, shows a 15% increase to 186,554 companies which experienced "significant" or "critical" financial distress in Q1 2011 compared to 161,601 companies in Q1 2010. The total number of businesses facing "critical" problems in Q1 2011 compared with Q1 2010 has increased by 11%. In particular it is the sectors which rely almost solely on consumer discretionary spending which are beginning to show the affects of anticipated job losses. Compared with Q1 2010 the level of combined distress (Significant and Critical) in the Bar & Restaurant sector was up by 68%. Businesses in the Leisure & Culture sector were faced with a 60% rise from Q1 2010. Figures for the Sports & Recreation sector show a 23% rise from Q1 2010. January 2011 marked the beginning of widespread 90-day consultations on job cuts resulting from October's Comprehensive Spending Review. A significant number of public sector staff will have received formal notification of impending redundancies which will have had an impact on discretionary consumer spending. Ric Traynor, Executive Chairman of Begbies Traynor Group, said: "The figures for Q1 2011 show the number of UK companies facing 'critical' problems has risen year on year with significant increases across the leisure sector in particular. "Compared with our figures for food retail which show little change, it seems likely that a fall in consumer confidence and spending power driven by anticipated job losses lies at the core of the leisure sector's troubles. "Another marked increase was evident in the professional services sector where the number of firms showing signs of distress was up by 61% compared with Q1 2010." Mr. Traynor commented: "Over 15,000 firms in the professional services sector are showing signs of significant or critical problems -- partly driven by a stale property and corporate deals market -- often the drivers for an active professional services community. Compared with the Q1 2010 figure of 9,620 it seems that firms which operate with a high fixed cost base are finding the current market conditions increasingly difficult as their revenues fail to recover and the scope for further cost reductions becomes more limited." Mr. Traynor added: "High levels of legal actions taken against debtors indicate that creditors are attempting to maximize cash collection right across their customer base. The hike in oil prices and January's VAT increase has made cash flow and credit control essential priorities for most businesses with some seeking payments through the courts." =================== U Z B E K I S T A N =================== ALOKABANK JOINT-STOCK: Moody's Affirms 'E+' BFSR; Outlook Stable ---------------------------------------------------------------- Moody's Investors Service has affirmed the stand-alone E+ bank financial strength rating of Alokabank (Uzbekistan) mapping to B3 on the long-term rating scale. Alokabank's B1 and B2 long-term global scale local and foreign currency deposit ratings, as well as the bank's Not Prime short-term ratings were also affirmed. The outlook on all of Alokabank's long-term ratings is stable. Moody's assessment is primarily based on Alokabank's audited financial statements for 2010 prepared under IFRS. Ratings Rationale According to Moody's, Alokabank's ratings are constrained by the weaknesses in the bank's risk management and corporate governance practices. In particular, the bank has been historically involved in related-party business which accounted for 24% of the bank's gross loan book and 47% of its customer deposit base at YE2010. Alokabank's credit concentration levels also remain high with the 20 largest exposures comprising 53% of the bank's total gross loan book and 141% of its Tier 1 capital as at YE2010, although Moody's observes some improvement from 70% and 215% levels, respectively, a year earlier. Despite Alokabank's high regulatory capital levels, the bank's economic capitalization is weak due to the (1) accumulated investments in non-core insolvent manufacturing companies (in accordance with the Uzbek government's program, whereby local banks are encouraged to invest in the reorganizing and re- equipping of weak corporates' production sites before these entities are sold to third-party investors) amounting to 30% of the bank's Tier 1 capital at YE2010; and (2) the bank's investments in fixed assets totaling 60% of its Tier 1 capital at the same reporting date. On a positive note, Alokabank's ratings are supported by the sustainable and robust quality of its loan book, with no overdue or restructured loans as at YE2010. The bank's individually impaired loans as reported under YE2010 IFRS accounted for 2.26% of the gross loan portfolio and were fully covered by loan loss reserves of 3%. Moody's observes that this good performance of the loan book, as well as Alokabank's active involvement in settlement and money transfer transactions for its corporate and retail clients support the bank's recurring and healthy income streams, which mainly consist of interest income and fees and commissions (43% and 39% of total operating income, respectively, in 2010). Moody's also notes that Alokabank's industry concentration levels have somewhat improved over the recent years, with the bank's largest industry exposure (to the telecommunication sector) now accounting for 18% of the total loan book compared to 25% at YE2009; nevertheless, the rating agency would like to see more sustainable trends proving the bank's diversification to other segments of economy. Moody's also views favorably Alokabank shareholders' continuous capital support to the bank. During 2010, a UZS15 billion (USD9.15 million) capital injection was completed which accounted for 35% of the bank's pre-injection total shareholders' equity, and further capital injections are expected to be fulfilled by the shareholders over the coming two years. Alokabank's local currency deposit rating derives from the bank's long-term scale of B3 and also incorporates a two-notch uplift to B1, reflecting (i) the high probability of systemic support expected to be rendered to the bank, in case of distress, in accordance with the bank's special mandate for rendering services to the state telecommunication industry and (ii) the cumulative direct and indirect state ownership in the bank's capital -- accounting for more than 80%. Alokabank's long-term foreign currency deposit rating is at B2. The principal methodologies used in rating Alokabank are Moody's "Bank Financial Strength Ratings: Global Methodology", published in February 2007, and "Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology", published in March 2007. Headquartered in Tashkent, Uzbekistan, Alokabank reported total assets of US$206 million and net income of US$3.9 million as per the audited IFRS statements as of Dec. 31, 2010. QISHLOQ QURILISH: Moody's Affirms 'E+' BFSR; Stable Outlook ----------------------------------------------------------- Moody's Investors Service has affirmed the standalone E+ bank financial strength rating, B1/Not Prime long-term and short-term global local currency (GLC) deposit ratings of Qishloq Qurilish Bank (QQB). The bank's B2/Not Prime long-term and short-term foreign currency deposit ratings were also affirmed. The outlook on the long-term global scale ratings is stable. Ratings Rationale According to Moody's, QQB's standalone E+ BFSR, which maps to a long-term scale of B3, remains constrained by (i) its narrow franchise, (ii) relatively high single-sector and single-product concentrations in the loan portfolio; and (iii) risks associated with rapid growth and the unseasoned nature of the loan book. The ratings also reflect QQB's sound financial indicators, including liquidity and capitalization. In 2010, QQB remained focused on implementing a state program for developing rural construction and mortgage lending; the latter contributed over 60% to the bank's loan book and over 40% to total assets as at YE2010. QQB's near-90% assets growth in 2010 was mostly financed by long-term deposits from state funds and timely capital injections, which helped the bank to protect the maturity match between assets and liabilities, and to maintain healthy capital adequacy of over 40%. Moody's views positively the expansion of the bank's franchise; however, the rating agency notes the risks related to relatively high product and sector concentrations as well as uncertainty over the bank's strategy after 2015 when the government program expires. At the same time, QQB's GLC deposit rating of B1 received a two- notch uplift from the bank's long-term scale based on Moody's assumption of high probability of extraordinary support from the government in case of distress. In 2009-2010 Moody's saw the evidence of the government commitment to develop the bank by injecting new capital. Given that the state owns over 75% of QQB, the bank is likely to benefit from access to capital and liquidity going forward, as it serves socially and economically important sectors. Previous Rating Actions and Principal Methodologies Moody's last rating action on Qishloq Qurilish Bank was on 17 December 2009 -- when Moody's upgraded the bank's GLC deposit rating to B1 from B2 and global foreign currency rating to B2 from B3 along with a stable outlook. The principal methodologies used in this rating were "Bank Financial Strength Ratings: Global Methodology", published in February 2007, and "Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology", published in March 2007. Domiciled in Tashkent, Uzbekistan, QQB reported -- as at Dec. 31, 2010 -- total assets of US$430 million, shareholders' equity of US$106 million and net income of US$4.2 million, according to unaudited local GAAP. =============== X X X X X X X X =============== * Upcoming Meetings, Conferences and Seminars --------------------------------------------- April 27-29, 2011 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott, Chicago, IL Contact: http://www.turnaround.org/ May 5, 2011 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - New York City Association of the Bar of the City of New York, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ May 6, 2011 AMERICAN BANKRUPTCY INSTITUTE New York City Bankruptcy Conference Hilton New York, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ June 6, 2011 AMERICAN BANKRUPTCY INSTITUTE Canadian-American Cross-Border Insolvency Symposium Fairmont Royal York, Toronto, Ont. Contact: 1-703-739-0800; http://www.abiworld.org/ June 9-12, 2011 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort and Spa, Traverse City, Mich. Contact: http://www.abiworld.org/ July 21-24, 2011 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Hyatt Regency Newport, Newport, R.I. Contact: 1-703-739-0800; http://www.abiworld.org/ July 27-30, 2011 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Sanctuary at Kiawah Island, Kiawah Island, S.C. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 4-6, 2011 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hotel Hershey, Hershey, Pa. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 14, 2011 AMERICAN BANKRUPTCY INSTITUTE NCBJ/ABI Educational Program Tampa Convention Center, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. __, 2011 AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium Dublin, Ireland Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 25-27, 2011 TURNAROUND MANAGEMENT ASSOCIATION Hilton San Diego Bayfront, San Diego, CA Contact: http://www.turnaround.org/ Dec. 1-3, 2011 AMERICAN BANKRUPTCY INSTITUTE 23rd Annual Winter Leadership Conference La Quinta Resort & Spa, La Quinta, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ April 3-5, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference Grand Hyatt Atlanta, Atlanta, Ga. Contact: http://www.turnaround.org/ Apr. 19-22, 2012 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ November 1-3, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Westin Copley Place, Boston, Mass. Contact: http://www.turnaround.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ April 10-12, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott Chicago, Chicago, Ill. Contact: http://www.turnaround.org/ October 3-5, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Wardman Park, Washington, D.C. Contact: http://www.turnaround.org/ ********* 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. 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