TCREUR_Public/110720.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, July 20, 2011, Vol. 12, No. 142

                            Headlines



F I N L A N D

ELCOTEQ SE: To Apply for Controlled Mgt. Under Luxembourg Laws


G E R M A N Y

BAYERISCHE LANDESBANK: Makes "Little Progress" in Rescue Talks
BRENNTAG FINANCE: Moody's Assigns Ba1 Rating to EUR400-Mil. Notes
HYPO REAL ESTATE: Wins European Approval for Restructuring Plan
OPERA GERMANY: Fitch Affirms 'CCC' Ratings on Two Classes of Notes
QUEEN STREET: S&P Assigns 'B+' Rating to US$50-Mil. Variable Notes

S-COORE 2007-1: Fitch Cuts 'Csf' Ratings on Two Classes of Notes
VERSATEL AG: Moody's Confirms B2 CFR; Outlook Negative
VERSATEL AG: S&P Lowers Long-term Corporate Credit Rating to 'B'
WESTLB AG: May Get EU Approval for German State Aid by October


G R E E C E

* GREECE: Fitch Downgrades Issuer Default Ratings to 'CCC'


I R E L A N D

ALLIED IRISH: Exceeds EBA Stress Test Threshold
BANK OF IRELAND: S&P Corrects Ratings on Instruments to 'BB+'
CREDIT-LINKED ENHANCED: Fitch Withdraws 'CCsf' Rating on Series 65
MCINERNEY HOLDINGS: Rebel Shareholder Granted Second EGM
RIVOLI-PAN EUROPE: Fitch Affirms 'BBsf' Rating on Class C Notes

SUPERQUINN: Goes Into Receivership, Owes EUR400 million


L U X E M B O U R G


GSC EUROPEAN: Moody's Lifts Rating on EUR5-Mil. W Notes to 'Caa2'


N E T H E R L A N D S

CHAPEL 2003: S&P Lowers Rating on Class C Notes to 'CCC'
CHAPEL 2007: S&P Lowers Rating on Three Classes of Notes to 'CCC'
GRESHAM CLO: Moody's Confirms Rating on Class F Notes at 'Ca (sf)'
HARBOURMASTER CLO: Fitch Withdraws Low-B Ratings on Combo Notes
OPERA FINANCE: Moody's Lowers Rating on Class A Notes to 'B3 (sf)'


N O R W A Y

SEVAN MARINE: May File for Bankruptcy if Restructuring Fails


P O R T U G A L

BPN-BANCO PORTUGUES: Banco BIC to Make Buyout Offer Today
* PORTUGAL: Moody's Lowers Debt Ratings of Seven Banks


S E R B I A   &   M O N T E N E G R O

PROCREDIT BANK: Fitch Affirms Issuer Default Rating at 'B-'


S P A I N

BBVA CONSUMO: S&P Lowers Rating on Class B Notes to 'BB-'
BBVA FINANZIA: S&P Affirms Rating on Class C Notes at 'CCC'
CASSIOPEIA QEX: S&P Affirms 'B-' Ratings on Two Classes of Notes
GC SABADELL: S&P Lowers Rating on Class C Notes to 'CCC'
IM GROUP: S&P Affirms Rating on Class E Notes at 'D (sf) '

IM TERRASSA: Fitch Downgrades Rating on Class C Notes to 'BBsf'


S W I T Z E R L A N D

SWISS RE: S&P Assigns 'BB+' Rating to Series VI Class E Notes


U K R A I N E

NADRA BANK: Expects to Exit Receivership by August 12


U N I T E D   K I N G D O M

BLACKS LEISURE: Turns to Bank Following Decline in Sales
CARNUNTUM HIGH: S&P Affirms Rating on Class E Notes at 'BB'
INEOS FINANCE: Moody's Upgrades CFR to 'B2'; Outlook Positive
KINETICS GROUP: In Administration for Second Time in a Month
LLOYDS BANKING: In Exclusive Talks to Sell Distressed Loan Package

NEMUS II ARDEN: Fitch Affirms Rating on Class F Notes at 'CCsf'
SAMURAI SUSHI: Chozen Venues Buys Four Sites From Administration
SHERWOOD CASTLE: S&P Affirms 'BB' Ratings on Two Classes of Notes
SIMCLAR GROUP: Former Director in Court Row Over House
SOUTHERN CROSS: NHP to Establish New Company to Run Care Homes

TITAN EUROPE: S&P Retains 'B-' Rating on Class E Notes
URSUS 2 OCTANE: Fitch Affirms Rating on Class F Notes at 'BBsf'
WINDERMERE XI: Fitch Affirms Ratings on Two Classes of Notes at D
WOOD NEWTON: Enters Liquidation; 54 Workers Lose Jobs
* UK: Business Insolvency Rate Drops in June, Experian Says




                            *********


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F I N L A N D
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ELCOTEQ SE: To Apply for Controlled Mgt. Under Luxembourg Laws
--------------------------------------------------------------
Elcoteq SE said Monday that it has decided to apply for controlled
management under the laws of Luxembourg to secure continuation of
the Company's current operations and to allow the previously
announced outside investor to finalize its due diligence.  This is
a consequence of Elcoteq's revolving credit facility lenders'
decision to accelerate Elcoteq's outstanding revolving credit
facility despite requests for a standstill.

Elcoteq has received a notice from Danske Bank, according to which
Danske Bank has decided, under the direction of the revolving
credit facility lenders, to accelerate Elcoteq's outstanding
revolving credit facility despite the ongoing negotiations
concerning the contemplated transaction with the outside investor.
Simultaneously, the lenders have taken actions to block some of
the Company's bank accounts. Danske Bank is acting as an agent on
behalf of the other lenders: The Royal Bank of Scotland,
Skandinaviska Enskilda Banken, Nordea Bank, Pohjola Bank, Banco
Bilbao Vizcaya Argentaria, UniCredit Bank and HSH Nordbank.

Since November 2009, the Company has been able to reduce the
revolving credit facility from EUR230 million to EUR48.5 million.
On June 30, 2011, the Company announced that the Company would not
be able to repay on its maturity the remaining outstanding amounts
under the facility.  However, the Company entered into
negotiations with the outside investor concerning a major equity
and debt investment in the Company, and if the intended
transaction is consummated, it would significantly strengthen
Elcoteq's financial position.

Elcoteq said the Company is extremely disappointed that the
lenders have taken the above actions despite requests not to
accelerate the facility in order to secure enough time for the
outside investor to complete a confirmatory due diligence process.
In the Company's view, the lenders' act shows total disregard of
the Company's customers, suppliers and close to 7000 employees as
well as other stakeholders.

Due to these developments, the Board of Directors of the Company
has decided to apply for controlled management under the laws of
Luxembourg to secure continuation of the Company's current
operations and to allow the outside investor to finalize its due
diligence.

                        About Elcoteq SE

Elcoteq SE -- http://www.elcoteq.com/-- is a Finland-based
manufacturer of electronics that focuses on communication
technology.  The Company is engaged in the design, production,
distribution and after-sales services of communications equipment.
Its production activities are organized in three business areas:
Communications Networks, Personal Communications and Home
Communications.  The Company's international service network
covers altogether 15 countries across Europe, the Americas and
Asia-Pacific region.  It includes manufacturing plants, product
development units and new product introduction centers in Hungary,
Estonia, Romania, Russia, India, China, Mexico and Brazil.


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


BAYERISCHE LANDESBANK: Makes "Little Progress" in Rescue Talks
--------------------------------------------------------------
Aoife White at Bloomberg News reports that EU Competition
Commissioner Joaquin Almunia said Bayerische Landesbank, Germany's
second-biggest state-owned lender, has made "very little progress
so far" on negotiations with EU regulators over approval for
government help.

According to Bloomberg, Mr. Almunia said "BayernLB will not be in
a position to find an adequate solution unless, in the coming
days, the Bavarian authorities will put forward" proposals for how
the bank will compensate for harm to competition.

Bloomberg relates that the Bavarian finance ministry said "some
aspects" of BayernLB's plan "still require an in-depth discussion"
over the next few months.  Bloomberg notes that an e-mailed
statement said the remaining issues to be solved "shouldn't result
in a weakening of the savings banks or an under-capitalization of
BayernLB".

                          About BayernLB

Bayerische Landesbank a.k.a BayernLB -- http://www.bayernlb.de/--
acts as the principal bank to the state of Bavaria and as the
central clearing house for the 75 Bavarian sparkassen (savings
banks).  Also serving corporations, national and local
governments, financial institutions, and real estate firms, the
bank offers a variety of services, including financing, security
underwriting and trading, and risk management.  It provides retail
and private banking services for individuals through its Internet
bank, Deutsche Kreditbank, and through banking subsidiaries in
central and southeastern Europe.  BayernLB's Landesbank Saar
subsidiary (75% owned) provides financing to small and midsized
businesses in the German state of Saarland and in France.


BRENNTAG FINANCE: Moody's Assigns Ba1 Rating to EUR400-Mil. Notes
-----------------------------------------------------------------
Moody's Investors Service has assigned a definitive Ba1- LGD4
(50.16%) rating to Brenntag's newly proposed EUR400 million worth
of senior unsecured guaranteed notes maturing in 2018. All other
ratings of the Brenntag group remain unchanged. The outlook on all
ratings is stable.

RATINGS RATIONALE

"The definitive rating assigned by Moody's to the newly proposed
notes is in line with Brenntag's corporate family rating,
reflecting the fact that there is no meaningful financial debt
ranking ahead of the senior unsecured notes at the time of
issuance," says Gianmarco Migliavacca, a Moody's Vice President --
Senior Analyst and lead analyst for Brenntag. In particular,
Brenntag's new syndicated bank facilities announced for the
refinancing, despite having maintenance financial covenants, are
nevertheless senior unsecured facilities ranking pari-passu with
the notes and sharing substantially the same guarantor package.

The newly proposed EUR400 million of senior unsecured guaranteed
notes is issued by Brenntag Finance BV, a subsidiary indirectly
owned by the parent company, Brenntag AG, and will rank pari passu
with the unsecured and unsubordinated indebtedness of the Brenntag
group.

The newly proposed notes will be guaranteed by Brenntag AG and
selected material subsidiaries, together accounting for 78.6% of
the 2010 audited consolidated EBITDA of the Brenntag group. There
will be no maintenance guarantor test during the life of the notes
-- however, this is set at 65% of group EBITDA for the new bank
facilities, which have substantially the same guarantors as the
notes. All guarantees, except for that provided by the parent
Brenntag AG, will upon request of Brenntag be automatically
released if at least two out of the three main credit rating
agencies confirm that Brenntag attains investment-grade status.

The terms and conditions of the notes do not include incurrence
covenants, whilst the new bank facilities will have maintenance
financial covenants, and the cross-default clause in the terms of
the notes is limited to a financial debt payment default scenario.
As a result, despite the pari-passu ranking, Moody's highlights
that, practically, in case of breach of maintenance financial
covenants under the new bank facilities, only the lenders of the
new bank facilities could call an acceleration event and start a
recovery process under the guarantees, whilst the noteholders
would have no ability to do that, until cross acceleration is
triggered. Moody's also highlights the newly proposed notes mature
in 2018, after the bank facilities (2016), however this
chronological subordination is not a material factor in Moody's
rating methodology when assessing relative positioning of
different debt instruments. Under this respect, we also note that,
according to the newly proposed notes' terms and conditions, the
Issuer could always call the notes at any time before their
maturity date, provided it delivers a min 60 days and max 90 days
prior notice to the noteholders, and subject to customary make-
whole provisions.

While Moody's does not anticipate positive rating pressure at this
stage, a rating upgrade could arise if Brenntag were to: (i)
continue to improve its leverage profile and operate with a ratio
of gross debt/EBITDA (as adjusted by Moody's) that is sustainably
below 3.0x; and (ii) increase its ratio of retained cash flow
(RCF)/debt (as adjusted by Moody's) sustainably above 20%.
Moreover, to achieve a rating upgrade, management would need to
demonstrate a strong official commitment to investment-grade
rating status.

Negative pressure could arise if the group's gross debt/EBITDA
ratio were to increase sustainably above 4.0x and its RCF/debt
ratio were to fall below 15%. Any deviation from the announced
acquisition policy -- particularly with regard to the avoidance of
transformative debt-funded acquisitions -- could also exert
downward rating pressure on the rating.

The principal methodology used in rating Brenntag was the Global
Chemical Industry Rating Methodology, published December 2009.

Brenntag is the world's largest independent chemical distributor,
with an estimated global market share of 6.9% and 2010 revenues of
EUR7.6 billion. The group has market-leading positions in Europe
(12.0% market share) and in Latin America (7.1% market share). It
also has a strong presence in North America, where it ranks as the
number three player, with a 10.0% market share. Brenntag, a former
division of Stinnes AG, a German logistics group, was sold to
funds advised by Bain Capital in an LBO in 2004, and in September
2006 to funds advised by BC Partners in a secondary LBO. Since the
IPO in 2010, Brenntag has been listed on the Frankfurt Stock
Exchange. Since January 2011, the free float of the group was 64%.


HYPO REAL ESTATE: Wins European Approval for Restructuring Plan
---------------------------------------------------------------
Aoife White at Bloomberg News reports that Hypo Real Estate
Holding AG, the only German lender to fail last year's banking
stress tests, won European Union approval for its German-
government rescue.

According to Bloomberg, the European Commission said in an
e-mailed statement that Hypo's pbb Deutsche Pfandbriefbank "core
bank" arm will shrink its balance sheet by 85% by the end of 2011
compared with three years earlier in return for final EU
authorization for state aid.

"Our goal is to prepare pbb Deutsche Pfandbriefbank for re-
privatization -- which is also a requirement stipulated by the EU
Commission," Bloomberg quotes Manuela Better, chief executive
officer of Hypo, as saying in an e-mailed statement.  "Although
the conditions imposed are very extensive, they offer sufficient
potential" for success on "credit and capital markets."

Bloomberg relates that Hypo said Deutsche Pfandbriefbank had
EUR102 billion in assets at the end of March, compared with Hypo's
EUR420 billion in assets at the end of 2008.

The lender's restructuring was reviewed by the EU to make sure it
didn't gain an unfair advantage from state help, Bloomberg notes.

Hypo, whose 2008 implosion was Germany's biggest bank failure
since World War II, has received EUR10 billion (US$14 billion) in
capital and as much as EUR142 billion in credit lines and debt
guarantees from the state and financial institutions.

                      About Hypo Real Estate

Germany-based Hypo Real Estate Holding AG (FRA:HRXG) --
http://www.hyporealestate.com/-- is a German holding company for
the Hypo Real Estate Group.  It is an international real estate
financing company, combining commercial real estate financing
products with investment banking.  The Company divides its
operations into three business units: Commercial Real Estate,
which provides real estate financing on the international and
German market; Public Sector & Infrastructure Finance, and Capital
Markets & Asset Management.  Hypo Real Estate Group operates
through a number of subsidiaries, including, among others, Hypo
Real Estate Bank International AG that focuses on Pfandbrief-based
commercial real estate financing in all international markets, and
offers large-volume investment banking and structured finance
transactions; Hypo Real Estate Bank AG that focuses on the
commercial real estate financing and refinancing business in
Germany, and DEPFA Bank plc in Dublin, Ireland, which is a
provider of public finance.



OPERA GERMANY: Fitch Affirms 'CCC' Ratings on Two Classes of Notes
------------------------------------------------------------------
Fitch Ratings affirmed Opera Germany (No. 2) p.l.c.'s CMBS notes
The rating actions are:

   -- EUR374.5m class A (XS0278492706): affirmed at 'A'; Outlook
      revised to Stable from Negative

   -- EUR46.8m class B (XS0278493001): affirmed at 'BBB'; Outlook
      revised to Stable from Negative

   -- EUR65.6m class C (XS0278493266): affirmed at 'B'; Outlook
      revised to Stable from Negative

   -- EUR63.7m class D (XS0278493340): affirmed at 'CCC'; Recovery
      Rating revised to 'RR3' from 'RR5'

   -- EUR9.4m class E (XS0278493423): affirmed at 'CCC'; 'RR6'
      affirmed

The affirmation of the notes and Outlook revision from Negative to
Stable reflects improvement in economic conditions in Germany, on
which letting up of vacant space and successful refinancing rely.

Opera Germany (No. 2) finances the EUR560 million A-note of a
single interest-only loan secured by four shopping centers located
in Germany. On December 18, 2009, a restructuring of the
underlying loan was completed with loan maturity extended by two
years. This was aimed at facilitating the redevelopment of the
second-largest property, Koe-Galerie, a prime Dusseldorf shopping
centre.

Koe-Galerie exhibits an elevated vacancy rate of 46%. Fitch notes
that reported ICR figures (1.51x for the securitized portion and
1.32x for the whole loan) are based on projected income inclusive
of an interest payment support account and therefore do not fully
reflect the weakened cash flow.

Completion of the works will have a major impact on future
performance of the loan. The other three shopping centers are all
broadly stable, with the slight increase in vacancy expected to
subside as economic fortunes in Germany improve.

The loan is due in October 2013, by which date redevelopment is
scheduled to have completed. Given the building works and a
shortened, one-year tail-period, there is extra reliance on the
borrower initiating sale or refinancing of the stabilized assets
in time for loan maturity.


QUEEN STREET: S&P Assigns 'B+' Rating to US$50-Mil. Variable Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned a preliminary credit
rating of 'B+ (sf)' to the US$50 million principal-at-risk
variable-rate notes to be issued by Queen Street III Capital Ltd.,
sponsored by Munich Reinsurance Co.

Munich Reinsurance Co. (Munich Re; AA-/Stable/--) will also be the
counterparty to the risk transfer contract. It is the principal
operating company, as well as the ultimate holding company in a
group of affiliated companies (the Munich Re Group). Munich Re
transacts insurance and reinsurance business worldwide and is one
of the largest global reinsurers in terms of premiums written and
capital.

The notes cover European windstorm between July 2011 and July 2014
in these countries: Belgium, Denmark, France, Germany, Ireland,
Luxembourg, The Netherlands, and the U.K.

AIR Worldwide Corp. (AIR), as the event calculation agent, will
calculate an index value following a qualifying event. The index
value will be based on industry losses reported by PERILS AG and
pre-determined payout factors by country, including pre-determined
exchange rates for Denmark and the U.K.

The proceeds from the sale of the notes will be invested in a U.S.
Treasury money market fund invested in T-bills. The subsidiary of
the asset management arm of Munich Re, MEAG MUNICH ERGO
Kapitalanlagegesellschaft mbH, manages the MEAG Queen Street III
fund. The fund has a rating of 'AAAm'.


S-COORE 2007-1: Fitch Cuts 'Csf' Ratings on Two Classes of Notes
----------------------------------------------------------------
Fitch Ratings has downgraded S-Core 2007-1 GmbH's classes C and D
notes, due April 2016:

   -- EUR319.11m class A-1 secured notes (ISIN: XS0312778680):
      affirmed at 'BBBsf; Negative Outlook; affirmed 'LS-2'

   -- EUR91m class A-2 secured notes (ISIN: XS0312801763):
      affirmed at 'Bsf'; Negative Outlook; affirmed 'LS-3'

   -- EUR8.85m class B secured notes (ISIN: XS0312778920):
      affirmed at 'CCCsf'; assigned Recovery Rating (RR) of RR-1

   -- EUR9.6m class C secured notes (ISIN: XS0312779068):
      downgraded to 'CCsf' from 'CCCsf'; assigned RR-6

   -- EUR12.4m class D secured notes (ISIN: XS0312779142):
      downgraded to 'Csf' from 'CCsf'; assigned RR-6

   -- EUR19.7m class E secured notes (ISIN: XS0312779225):
      affirmed at 'Csf'; assigned RR-6

The downgrades reflect the pool deterioration due to the
additional defaults that have occurred since the last performance
review in November 2009. As of the April investor report, eight
loans amounting for EUR23.2 million have defaulted since Fitch's
last rating action. Thus, the total defaults have increased to
EUR43.2 million from EUR20 million. The transaction features a
principal-deficiency ledger (PDL) mechanism which traps excess
spread and recoveries in order to reduce the total defaults. As a
result of this excess spread trapping mechanism, the total
defaults have been reduced to EUR29.9 million -- the outstanding
PDL balance. However, the outstanding PDL balance has increased
from EUR9.2 million at the rating action as a result of the
additional defaults. The increased PDL balance results in lower
credit enhancement for all the rated classes of notes compared to
last review. In Fitch's view, the PDL balance is unlikely to be
significantly reduced until maturity; hence the subordinated rated
classes C, D and E are likely to suffer losses.

The loans securitized in this transaction are bullet loans
maturing on three different dates. According to the investor
report as of April, the amortization schedule (by notional) is the
following: 57% in March 2012, 2.6% in November 2012 and 40.4% in
March 2014.. In Fitch's view, the clustered maturities expose the
transaction to refinancing risk. Fitch expects weaker borrowers to
have difficulties refinancing at loan maturity, which could lead
to additional defaults. This risk is reflected in the rating and
Negative Outlook on the notes.

Since closing, 15 loans have defaulted and nine have prepaid. As a
result of this, the number of performing assets in the pool has
gone down to 133 from 157. The current performing pool balance is
EUR430.8m, which is 85% of the initial pool balance. In terms of
large obligor concentrations, the pool has remained largely
unchanged. The largest obligor makes up 2.3% of the current pool.

Fitch has assigned Recovery Ratings to all the classes rated
'CCCsf' or below. RR are issued on a scale of 'RR1' (highest) to
'RR6' (lowest) to denote the range of recovery prospects of notes
rated at or below 'CCCsf'.

Fitch has assigned an Issuer Report Grade (IRG) of two stars
("basic") to the publicly available reports on the transaction.
The reporting is accurate and timely. While it contains
counterparty details, priority of payments and various
stratifications, reports are quarterly rather than monthly.

The transaction is a cash securitization of certificates of
indebtedness (Schuldscheindarlehen) of German SMEs originated and
serviced by Deutsche Bank AG (rated 'AA-'/Negative/'F1+').


VERSATEL AG: Moody's Confirms B2 CFR; Outlook Negative
------------------------------------------------------
Moody's Investors Service has confirmed Versatel AG's B2 corporate
family rating (CFR) and the B3 rating for the company's EUR525
million senior secured floating-rate notes due in 2014. The
outlook on all ratings is negative.

The announcement concludes the review of Versatel's ratings which
Moody's initiated on 19 May 2011 following the announcement of a
takeover offer from funds advised by Kohlberg Kravis Roberts & Co.
(KKR).

Moody's understands that the company will refinance in the short
term the existing capital structure, including the outstanding
amounts under the EUR525 million senior secured floating-rate
notes due in 2014, with a new senior secured bank facility worth
EUR465 million. Moody's expects to withdraw the ratings of
Versatel upon successful closing of this refinancing transaction
and repayment of the outstanding amounts under the notes.

RATINGS RATIONALE

"The confirmation of Versatel's ratings reflects Moody's
expectation that there will not be any material change in the
company's business or financial profiles following its takeover by
funds advised by KKR," says Ivan Palacios, a Moody's Vice
President -- Senior Analyst and lead analyst for Versatel.

"The proposed refinancing of the existing floating-rate notes with
a bank facility will be leverage-neutral, and Moody's expects
Versatel's adjusted debt/EBITDA to remain post-transaction at
around 4.0x-4.5x, which is consistent with the current B2 rating
category," says Mr. Palacios. "As the refinancing involves longer-
term bank debt, it improves the company's debt maturity profile
and removes the refinancing risk in 2014," adds Mr. Palacios.

The company's strategy will remain largely unchanged as KKR is
supportive of Versatel's strategic repositioning within its growth
segments of Business and Wholesale, while managing down the
residential business (currently in "harvest" mode) for cash
generation. KKR is also supportive of the cost-cutting efforts
that the company is implementing through its Transform project,
which aims to align its organization and processes to achieve
operational savings through efficiency improvements.

However, Moody's notes that, prior to the takeover announcement,
Versatel's B2 CFR was more weakly positioned within its rating
category and will likely remain so post-takeover. This is due to
the declining trend in Versatel's operating performance which saw
its EBITDA falling from EUR186 million in 2009 to EUR171 million
in 2010. Another reason is the company's guidance of an EBITDA of
EUR145 million for 2011, which highlights the continuation of
these negative trends, primarily as a result of pressures in
Versatel's residential business.

The negative outlook reflects Moody's expectation that Versatel's
revenue base will continue shrinking due to the strategy of
harvesting the residential business, and the challenges that the
company will face to offset the revenue and profit loss in the
residential business with growth in the Wholesale and Business
segments.

Upward pressure on the rating is not expected given the negative
outlook. However, the outlook on the ratings could be stabilized
if the revised strategic direction of the company proves
successful, the company delivers on its business plan and this is
demonstrated in a steady improvement in operating performance.

Further negative pressure on the rating could develop if the
company's operating performance weakens such that it fails to
achieve the revenue, EBITDA and cash flow targets, leading to
leverage trending to 4.5x on a sustained basis.

PRINCIPAL METHODOLOGIES

The principal methodology used in rating Versatel AG was the
Global Telecommunications Industry Methodology published in
December 2010. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.

Headquartered in Dsseldorf, Versatel is one of the leading
facilities-based alternative telecommunications operators in
Germany. In 2010, Versatel generated revenues of EUR725 million
and EBITDA (as adjusted by the company) of EUR171 million.


VERSATEL AG: S&P Lowers Long-term Corporate Credit Rating to 'B'
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on German alternative network operator Versatel AG
to 'B' from 'B+'. "At the same time, we removed all ratings on
Versatel from CreditWatch, where they were placed with negative
implications on May 20, 2011. In addition, we assigned our 'B'
long-term corporate credit rating to Versatel's new parent
company, VictorianFibre Holding GmbH. The outlook on both Versatel
and VictorianFibre Holding is stable," S&P said.

"We also assigned 'B+' issue ratings to the new senior facilities
that could be drawn by VictorianFibre Holding or Versatel AG. The
recovery rating on these facilities is '2', indicating our
expectation of substantial (70%-90%) recovery in the event of a
payment default. The facilities comprise a EUR70 million revolving
credit facility (RCF) due 2017, a EUR45 million term loan A due
2017, a EUR30 million term loan B1 due 2018, and a EUR320 million
term loan B2 due 2018," S&P related.

"Furthermore, we lowered the issue rating on Versatel's existing
EUR75 million RCF due 2012 to 'BB-' from 'BB', and that on its
EUR525 million floating rate notes (FRNs; EUR452 million
outstanding as of March 31, 2011) due 2014 to 'B+' from 'BB-', in
line with the downgrade of the corporate credit rating. We will
withdraw these issue ratings on completion of the refinancing.
Versatel expects the transaction and refinancing to be completed
in August 2011," S&P said.

"The downgrade primarily reflects our view that the proposed
refinancing of Versatel's existing capital structure is likely to
reduce the company's financial flexibility. This is due to
significantly lower cash on hand after the refinancing and the
requirement to comply with several financial maintenance
covenants, which is only partly offset by a longer debt maturity
profile. Furthermore, in our opinion, the company faces a
difficult task in offsetting declining revenues and gross profits
in its residential segment with higher revenues from business and
wholesale customers and cost-cutting measures in the medium term,"
S&P related.

"Our base-case assessment anticipates that Versatel's revenues are
likely to decline by about 13% in 2011. This decline is primarily
due to a further decline in revenues from residential customers
and significantly lower wholesale voice revenues from its major
customer Hansenet, a subsidiary of Spanish telecommunications
operator Telefonica S.A. (A-/Negative/A-2), which are not offset
by moderately higher revenues from its Business segment. However,
we anticipate only a modest revenue decline in 2012, as higher
revenues from wholesale and business customers are likely to
partly offset further residential revenue losses. Furthermore, we
project positive free cash flow of about EUR30 million in 2012, up
from about negative EUR5 million in 2011, mainly due to the
attendant benefits from the company's current restructuring
activities. In addition, we note that free cash flow generation in
2011 is burdened by high restructuring costs and one-time cash
outflows in relation to the refinancing," S&P said.

"The ratings on Versatel are constrained by what we consider to be
a weak business risk profile. There is intense price competition
for broadband and fixed-line telephony services and Versatel has
limited scale compared with its major competitors. We believe this
lack of scale could constrain the company's operating margins and
free operating cash flow generation in the medium term," S&P
noted.

Partly offsetting these constraints is Versatel's extensive
proprietary high-density multilocal network, which could enable
the company to generate sustainable revenues from wholesale
services.

"In our view, Versatel should maintain an adequate liquidity
profile and stabilize its revenues in 2012, primarily through
higher revenues from business and wholesale customers offsetting
lower residential revenues from further customer losses. In
addition, we anticipate that Versatel's reported EBITDA margin
should improve to about 23% in 2012, from about 20% in 2011,
mainly due to the company's current restructuring activities and
attendant benefits," S&P added.


WESTLB AG: May Get EU Approval for German State Aid by October
--------------------------------------------------------------
Aoife White at Bloomberg News reports that the European Commission
said WestLB AG, Germany's third-largest state bank, may receive
final EU approval for German state aid by October.

According to Bloomberg, the commission said that EU Competition
Commissioner Joaquin Almunia is "satisfied" with a restructuring
plan that will break up the bank and wind down parts of it.

                        Restructuring Plan

As reported by the Troubled Company Reporter-Europe on June 27,
2011, The Financial Times related that owners of WestLB succumbed
to pressure from Brussels by agreeing on a radical restructuring
that will in effect see the lender being split up and its
remainder wound down.  The FT said that the plan, brought forward
in a bid to win approval from the European Commission for aid
received during the financial crisis, will see the bank split into
a credit institution owned by the savings banks and a unit owned
by the regional state.  WestLB said in a statement that its owners
aim to either sell the rest of the bank -- which includes units
such as the corporate business and project financing -- by the
middle of next year, or transfer it into an existing "bad bank"
scheme, according to the FT.  The institution to be held by the
savings banks will become a bread-and-butter service provider --
called Verbundbank -- to its regional owners, which are set to
inject EUR1 billion (US$1.42 billion) in capital jointly with
their federal association, the FT disclosed.  The proposal
foresees the remaining rump of WestLB to be fully taken over by
the state of North Rhine-Westphalia, which will also inject EUR1
billion in capital, the FT stated.  This unit will act as a
"service and portfolio management bank" to the bad bank and the
Verbundbank, the FT noted.

                          About WestLB

Headquartered in Duesseldorf, Germany, WestLB AG (DAX:WESTLB)
-- http://www.westlb.com/-- provides financial advisory, lending,
structured finance, project finance, capital markets and private
equity products, asset management, transaction services and real
estate finance to institutions.  In the United States, certain
securities, trading, brokerage and advisory services are provided
by WestLB AG's wholly owned subsidiary WestLB Securities Inc., a
registered broker-dealer and member of the NASD and SIPC.
WestLB's shareholders are the two savings banks associations in
NRW (25.15% each), two regional associations (0.52% each), the
state of NRW (17.47%) and NRW.BANK (31.18%), which is owned by NRW
(64.7%) and two regional associations (35.3%).


===========
G R E E C E
===========


* GREECE: Fitch Downgrades Issuer Default Ratings to 'CCC'
----------------------------------------------------------
Fitch Ratings has downgraded Greece's Long-term foreign and local
currency Issuer Default Ratings (IDRs) to 'CCC' from 'B+. The
Short-term foreign currency IDR is also downgraded to 'C' from 'B'
and the Rating Watch Negative (RWN) on all three ratings has been
removed. The agency has affirmed the euro area Country Ceiling at
'AAA', which is applicable to all euro area member states,
including Greece.

The downgrade follows the assigning of a RWN on Greece's ratings
on May 20. At that time, Fitch stated that it would resolve the
RWN in light of the conclusion of the fourth review of Greece's
economic program by the IMF and that in the absence of a fully-
funded and credible EU-IMF program, Greece's sovereign ratings
would likely be lowered to 'CCC'. Moreover, Fitch's previous
rating of 'B+' was premised on the judgment that provision of new
money would not be conditional on private sector participation in
any new and enhanced EU-IMF program that would potentially result
in a default event.

The rating downgrade reflects the absence of a new, fully-funded
and credible EU-IMF program for Greece, coupled with heightened
uncertainty surrounding the role of private creditors in any
future funding, as well as Greece's weakening macroeconomic
outlook.

New money is required to address Greece's fiscal funding shortfall
that would otherwise emerge in 2012 -- a key weakness of the
current EU-IMF program highlighted by Fitch at the turn of the
year. Fitch had expected the uncertainty surrounding new money,
along with the role of private creditors, to be resolved with the
completion of the fourth review of the current EU-IMF program
earlier this month. The agency notes that while the main
parameters of a new multi-annual adjustment program were discussed
at an Ecofin meeting on July 11-12, no further clarity on the
volume and the terms of new money or the nature of private sector
participation was forthcoming.

Fitch remains of the opinion that any additional financial support
for Greece will only be credible in providing a path to fiscal
solvency if it is fully funded beyond the end of the current
program in mid-2013. New European Commission estimates of gross
fiscal financing needs of EUR172 billion up to mid-2014 imply
substantial additional EU-IMF financial support over and above the
EUR110 billion already committed. However, the agency is concerned
that reliance on privatization receipts of EUR30 billion and
largely unquantifiable private sector participation to supplement
official new money would leave a new program vulnerable to future
funding shortfalls, subjecting Greece to continuing uncertainty.
While asset sales of EUR5 billion look attainable in 2011, the
privatization program will become increasingly challenging.

Fitch believes any new program must be backed by credible policy
targets. The successful passage through parliament of the Medium
Term Fiscal Strategy at the end of June sent a strong message that
the Greek authorities remain fully committed to the EU-IMF
program. However, official new data for the first six months of
2011 point to expenditure overruns and revenue shortfalls,
highlighting the urgent need for recently legislated new measures
for 2011, while there are growing doubts about the capacity of the
Greek economy to withstand further fiscal consolidation in a
climate of continuing economic and financial uncertainty. Thus, a
further contraction in economic activity of some 4% of GDP now
looks likely in 2011, followed by a weak recovery in 2012.

Fitch's 'CCC' rating encapsulates substantial credit risk and
acknowledges that default is a real possibility. As previously
stated by Fitch, private sector involvement would likely be viewed
as a sign of sovereign credit impairment and could trigger a
rating default event.


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


ALLIED IRISH: Exceeds EBA Stress Test Threshold
-----------------------------------------------
Allied Irish Banks, p.l.c., noted the announcements of the EU-wide
stress testing exercise co-ordinated by the European Banking
Authority under the supervision of the Central Bank of Ireland.
The Educational Building Society was not included in the EBA
exercise.

The result of the EBA Stress test takes into account the
recapitalization measures announced following the Prudential
Capital Assessment Review.  The EBA methodology includes a number
of differences to the methodology applied in the PCAR exercise
conducted by the CBI in March 2011.  The EBA stress test set a 5%
Core Tier 1 capital requirement in the stress scenario, while a
level of 6% was applied in PCAR.  The PCAR was applied on a three
year horizon from 2011-2013 compared to the two year 2011-2012
timeline applied by the EBA.

The EBA 2012 stress scenario expects AIB, post recapitalization,
to have a Core Tier 1 capital ratio of 11.7% (including EUR1.4
billion contingent capital).  There were also additional
significant methodology differences applied to AIB in the EBA
stress test versus PCAR including future balance sheet size,
higher risk weightings, application of higher funding costs and
treatment of sovereign and bank credit losses.

The published results confirm that in all scenarios tested, AIB
exceeds the EBA stress test threshold of 5% Core Tier 1 capital
ratio and a significant capital surplus is evident in both the
base and stress scenarios.

To view the summary results including the EBA disclosure templates
for AIB please click on this link http://is.gd/QWj7Xh

                   About Allied Irish Banks, p.l.c.

Allied Irish Banks, p.l.c. -- http://www.aibgroup.com/-- is a
major commercial bank based in Ireland.  It has an extensive
branch network across the country, a head office in Dublin and a
capital markets operation based in the International Financial
Services Centre in Dublin.  AIB also has retail and corporate
businesses in the UK, offices in Europe and a subsidiary company
in the Isle of Man and Jersey (Channel Islands).

Since the onset of the global and Irish financial crisis, AIB's
relationship with the Irish Government has changed significantly.

As at Dec. 31, 2010, the Government, through the National Pension
Reserve Fund Commission ("NPRFC"), held 49.9% of the ordinary
shares of the Company (the share of the voting rights at
shareholders' general meetings), 10,489,899,564 convertible non-
voting ("CNV") shares and 3.5 billion 2009 Preference Shares.  On
April 8, 2011, the NPRFC converted the total outstanding amount of
CNV shares into 10,489,899,564 ordinary shares of AIB, thereby
increasing its holding to 92.8% of the ordinary share capital.

In addition to its shareholders' interests, the Government's
relationship with AIB is reflected through formal and informal
oversight by the Minister and the Department of Finance and the
Central Bank of Ireland, representation on the Board of Directors
(three non-executive directors are Government nominees),
participation in NAMA, and otherwise.

As reported by the TCR on May 31, 2011, KPMG, in Dublin, Ireland,
noted that there are a number of material economic, political and
market risks and uncertainties that impact the Irish banking
system, including the Company's continued ability to access
funding from the Eurosystem and the Irish Central Bank to meet its
liquidity requirements, that raise substantial doubt about the
Company's ability to continue as a going concern.

The Company reported a net loss of EUR10.16 billion on
EUR1.84 billion of interest income for 2010, compared with a net
loss of EUR2.33 billion on US$2.87 billion of interest income for
2009.

The Company's balance sheet at Dec. 31, 2010, showed
EUR145.2 billion in total assets, EUR140.9 billion in total
liabilities, and stockholders' equity of EUR4.3 billion.


BANK OF IRELAND: S&P Corrects Ratings on Instruments to 'BB+'
-------------------------------------------------------------
Standard & Poor's Ratings Services corrected its ratings on a
number of Bank of Ireland senior unsecured and unguaranteed
instruments and related programs. "The error occurred when we
affirmed our counterparty credit ratings on the bank on
April 6, 2011 (see 'Various Rating Actions Taken On Irish Banks
Following Financial Measures Programme & Bank Restructuring
Plan')," S&P said. S&P should have rated the affected instruments
'BB+', rather than 'BB+/B', but due to an administrative error, it
split into long- and short-term the ratings on these
instruments and programs:

    EUR50 mil fltg rate/step-up initial maturity 04/03/2009
    extendable maturity due 03/04/2013

    HKD160 mil 5.32% med-term nts ser 367 due 06/26/2013

    $2 bil fltg rate 13 mth Extd Mthly (Initial Maturity date
    08/14/2007) nts due 07/19/2011

    GBP15 mil fltg rate med-term nts ser 398 due 10/11/2011

    JPY10 bil 2.77% callable med-term nts ser 452 due 02/25/2037

    $1.75 bil fltg rate (initial maturity 08/15/2008) extd
    quarterly 13 mos nts due 08/14/2012

    GBP250 mil fltg rate med-term nts ser 451 due 02/15/2012

    AED100 mil med-term nts due 04/09/2018

    HKD60 mil 4.62% med-term nts ser 469 due 09/19/2012

    HKD100 mil 5.36% med-term nts ser 501 due 06/05/2017

    CHF80 mil 2.824% med-term nts ser 474 due 06/26/2012

    GBP4 mil fltg rate med-term nts ser 465 due 03/30/2017

    MXN360 mil var rate med-term nts ser 666 due 08/31/2020

    RON60.25 mil 9.9% med-term nts ser 668 due 10/04/2013

    $250 mil fltg rate extendible nts initial maturity 04/28/2009
    final maturity due 04/02/2013

    GBP200 mil fltg rate med-term nts ser 523 due 07/20/2012

    JPY5 bil 0.9% med-term nts ser 420 due 12/05/2011

    NOK61 mil fltg rate med-term nts ser 491 due 05/30/2012

    $10 mil 4.% med-term nts ser 655 due 11/23/2019

    $50 mil fltg rate med-term nts ser 399 due 10/11/2011

    $25 mil 5.155% med-term nts due 11/28/2012

    JPY5 bil fltg rate med-term nts due 03/23/2012

    HKD100 mil 4.505% med-term nts ser 407 due 10/25/2011

    GBP3.5 mil fltg rate med-term nts ser 603 due 09/10/2014

    HKD200 mil 4.4% med-term nts due 12/01/2016

    GBP2 mil fltg rate med-term nts ser 397 due 09/13/2012

    GBP4.45 mil fltg rate med-term nts ser 593 due 07/09/2014

    HKD75 mil 4.68% med-term nts ser 457 due 02/28/2014

    $11 mil 5.65% med-term nts ser 380 due 08/21/2015

    DKK50 mil fltg rate med-term nts ser 519 due 12/30/2016

    $20 mil fltg rate med-term nts ser 462 due 03/13/2012
    EUR2 bil med-term note prog 07/20/1995*
    $10 bil med-term note prog 12/08/2006*

*Only ratings on senior unsecured and unguaranteed long-term
issuance are affected.


CREDIT-LINKED ENHANCED: Fitch Withdraws 'CCsf' Rating on Series 65
------------------------------------------------------------------
Fitch Ratings has withdrawn Credit-Linked Enhanced Asset
Repackagings (C.L.E.A.R) Series 65's 'CCsf' rating.

The withdrawal is due to the lack of information on the
transaction's recent restructure. In addition, the manager of
Clear 65 will no longer provide Fitch with performance reports.


MCINERNEY HOLDINGS: Rebel Shareholder Granted Second EGM
--------------------------------------------------------
Geoff Percival at Irish Examiner reports that rebel shareholder,
David Nabarro, has won his appeal for a second extraordinary
general meeting to be held to allow shareholders to vote on the
future of McInerney Holdings.

Irish Examiner relates that earlier this month, the current board
of the Dublin-headquartered house-building group informed
shareholders of its intention to wind down the company through a
voluntary liquidation process, saying that it had "no realistic
alternative" as the business no longer has any "meaningful assets
of worth."

The debt-ridden property company has outstanding loans of around
EUR113 million to a three-bank consortium of Bank of Ireland,
Anglo Irish Bank and KBC Bank, Irish Examiner discloses.

Shareholders are scheduled to meet on July 29 to vote on the
board's proposals, Irish Examiner says.  However, McInerney has
granted Mr. Nabarro -- a London-based corporate financier who
acquired a 21.5% stake in the firm in June -- a second EGM for
August 17, Irish Examiner notes.  That will give shareholders a
chance to vote on his proposals; which include creating a new
board (featuring himself and colleagues Kevin Lynch and John
Garratt) and ultimately moving the company forward with a new
business plan, while raising sufficient funds to complete the
company's existing stock of building sites, Irish Examiner states.

                         About McInerney

McInerney Holdings plc -- http://www.mcinerneyholdings.eu/-- is a
home builder and regional home builder in the North and Midlands
of England.  It also undertakes commercial and leisure projects in
Ireland, United Kingdom and Spain.  It operates in Ireland, the
United Kingdom and Spain.  The main trading activities of the
Company's Irish home building business during the year ended
December 31, 2008, consisted of construction of private houses,
trading in developed sites and land, development of residential
land for third-parties and in joint-ventures, and contracting for
third-parties.  The Company's commercial property development
division, Hillview Developments Ltd (Hillview), develops
industrial units in the Greater Dublin area.  Hillview completed
1,223 square meters of industrial units as of December 31, 2008.
Its Spanish division, Alanda Group, is developing freehold
apartment schemes.  As of December 31, 2008, the Company completed
1,359 private and contracting residential units in Ireland, the
United Kingdom and Spain.


RIVOLI-PAN EUROPE: Fitch Affirms 'BBsf' Rating on Class C Notes
---------------------------------------------------------------
Fitch Ratings has affirmed Rivoli -- Pan Europe 1 plc's floating
rate notes:

   -- EUR309m Class A (XS0278734644) affirmed at 'AAAsf'; Outlook
      Stable

   -- EUR42.8m Class B (XS0278739874) affirmed at 'Asf'; Outlook
      Stable

   -- EUR23.6m Class C (XS0278741771) affirmed at 'BBsf'; Outlook
      Stable

The affirmation reflects the stable performance of the transaction
since the last rating action in September 2010. One of the five
original loans, SCI Nowa (accounting for 9% of the pool), repaid
at its scheduled maturity date in April 2011 and all proceeds were
allocated sequentially to the notes. The four remaining loans
continue to perform in line with Fitch's expectations.

Although the repayment halved the number of collateral properties,
the collateral remains well diversified by location, with assets
located in Spain, France and the Netherlands. The portfolio
comprises office and industrial properties as well as one shopping
centre. While three of the four remaining loans derive their
rental income from only one or two tenants, these are all
considered to be of investment-grade quality.

As of May 2011, the weighted-average (WA) interest and debt
service coverage ratios stood at 5.1x and 3.3x, respectively. This
represents a significant improvement compared to May 2010 (3.4x
and 2.7x). The WA occupancy rate across the pool remains strong at
97.6%. The WA reported loan-to-value ratio (LTV) is moderate at
64.3% (based on updated valuations, predominantly conducted in
2010); but the WA Fitch LTV remains higher at 78%. This is
primarily due to the Rive Defense loan, for which Fitch estimates
an LTV of 96%.

The four remaining loans are scheduled to mature in July 2012
(Rive Defense, 21.2% of the pool), January 2013 (Santa Hortensia,
28.2%), July 2013 (Parque Principado, 30.2%) and August 2015 (Blue
Yonder, 20.4%).


SUPERQUINN: Goes Into Receivership, Owes EUR400 million
-------------------------------------------------------
Conor Humphries at Reuters reports that RTE News said Superquinn
was put into receivership by a syndicate of banks, including
Allied Irish Banks, Bank of Ireland, and National Irish Bank after
building up debts of more than EUR400 million (US$561 million).

Reuters, citing RTE News, relates that Superquinn will continue
trading as normal under existing management.

Reuters discloses that RTE News notes that two representatives of
professional services firm KPMG have been appointed as receivers
to the firm.

Irish Times relates that Superquinn rival Musgrave's, which
operates a series of grocery chain franchises in Ireland and
Britain, is one of a number of parties now considering a bid for
the group.  Irish Times notes that Musgrave's is known to have
been interested in bidding for Superquinn in the past, but has not
made any formal approach before now.

Irish Times relates that a number of other bidders are said to be
circling Superquinn at this stage.  British chains such as
Sainsbury's and Waitrose have also been named in the past as
potential buyers, Irish Times notes.

Irish Times says that a statement from the receivers said that
they intend to continue trading as normal and are confident the
business can be sold as a going concern.  Irish Times relates that
their statement added that the chain will continue to employ its
2,800 staff and management, led by chief executive, Andrew Street,
for the duration of this process.

The receivers also intend contacting the chain's suppliers over
the coming days to inform them of the implications of the process,
Irish Times says.

According to their statement, they wish to continue to do business
with suppliers and will ensure payment for future deliveries for
the duration of the receivership, Irish Times adds.

Superquinn is one of Ireland's largest domestic retailers.  It
employs around 2,800 people in 23 stores around the country.
Superquinn is owned by Select Retail Holdings, which bought the
retailer for EUR350 million in 2005.


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


GSC EUROPEAN: Moody's Lifts Rating on EUR5-Mil. W Notes to 'Caa2'
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by GSC European CDO II S.A.:

Issuer: GSC European CDO II S.A.

   -- EUR266,000,000 Class A1 Floating Rate Notes due July 2020
      (current outstanding balance of EUR230,485,326), Upgraded to
      Aa2 (sf); previously on Jun 22, 2011 Aa3 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR10,000,000 Class A2 Zero Coupon Accreting Notes due July
      2020 (current outstanding balance of EUR8,664,862), Upgraded
      to Aa2 (sf); previously on Jun 22, 2011 Aa3 (sf) Placed
      Under Review for Possible Upgrade

   -- EUR25,000,000 Class B Floating Rate Notes due July 2020,
      Upgraded to A3 (sf); previously on Jun 22, 2011 Baa2 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR16,500,000 Class C1 Floating Rate Notes due July 2020,
      Upgraded to Ba2 (sf); previously on Jun 22, 2011 B1 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR11,000,000 Class C2 Fixed Rate Notes due July 2020,
      Upgraded to Ba2 (sf); previously on Jun 22, 2011 B1 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR16,000,000 Class D1 Floating Rate Notes due July 2020
      (current outstanding balance of EUR 17,079,660), Upgraded to
      Caa1 (sf); previously on Jun 22, 2011 Ca (sf) Placed Under
      Review for Possible Upgrade

   -- EUR2,000,000 Class D2 Floating Rate Notes due July 2020
      (current outstanding balance of EUR2,134,960), Upgraded to
      Caa1 (sf); previously on Jun 22, 2011 Ca (sf) Placed Under
      Review for Possible Upgrade

   -- EUR4,000,000 Combination V Notes due July 2020, Upgraded to
      Ba2 (sf); previously on Jun 22, 2011 B1 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR5,000,000 Combination W Notes due July 2020, Upgraded to
      Caa2 (sf); previously on Jun 22, 2011 Caa3 (sf) Placed Under
      Review for Possible Upgrade

The ratings of the Combination Notes address the repayment of the
Rated Balance on or before the legal final maturity. For Classes V
and W, the 'Rated Balance' is equal at any time to the principal
amount of the Combination Note on the Issue Date increased by the
Rated Coupon of 0.25% and 1.5% per annum respectively, accrued on
the Rated Balance on the preceding payment date minus the
aggregate of all payments made from the Issue Date to such date,
either through interest or principal payments. For Class Y, which
do not accrue interest, the 'Rated Balance' is equal at any time
to the principal amount of the Combination Note on the Issue Date
minus the aggregate of all payments made from the Issue Date to
such date, either through interest or principal payments. The
Rated Balance may not necessarily correspond to the outstanding
notional amount reported by the trustee.

RATINGS RATIONALE

GSC European CDO II S.A., issued in June 2005, is a single
currency Collateralised Loan Obligation ("CLO") backed by a
portfolio of mostly high yield European loans. The portfolio is
managed by GSC Group. The reinvestment period for this transaction
ended in July 2010. It is predominantly composed of senior secured
loans.

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011.

The actions reflect key changes to the modeling assumptions, which
incorporate (1) a removal of the temporary 30% default probability
macro stress implemented in February 2009, (2) increased BET
liability stress factors as well as (3) change to a fixed recovery
rate modeling framework.

Due to the impact of revised and updated key assumptions
referenced in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011, key model inputs used by
Moody's in its analysis, such as the portfolio par amount, WARF,
diversity score, and weighted average recovery rate, may be
different from the trustee's reported numbers. In its base case,
Moody's analyzed the underlying collateral pool to have a
performing par and principal proceeds balance of EUR315 million,
defaulted par of EUR35 million, a weighted average default
probability of 27.86% (consistent with a WARF of 3905), a weighted
average recovery rate upon default of 44.69%, and a diversity
score of 31. The default probability is derived from the credit
quality of the collateral pool and Moody's expectation of the
remaining life of the collateral pool. The average recovery rate
to be realized on future defaults is based primarily on the
seniority of the assets in the collateral pool. For a Aaa
liability target rating, Moody's assumed that 87% of the portfolio
exposed to senior secured corporate assets would recover 50% upon
default, while the remainder non first-lien loan corporate assets
would recover 10%. In each case, historical and market performance
trends and collateral manager latitude for trading the collateral
are also relevant factors. These default and recovery properties
of the collateral pool are incorporated in cash flow model
analysis where they are subject to stresses as a function of the
target rating of each CLO liability being reviewed.

Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, as evidenced by 1) uncertainties of
credit conditions in the general economy and 2) the large
concentration of speculative-grade debt maturing between 2012 and
2014 which may create challenges for issuers to refinance. CDO
notes' performance may also be impacted by 1) the manager's
investment strategy and behavior and 2) divergence in legal
interpretation of CDO documentation by different transactional
parties due to embedded ambiguities.

1) Deleveraging: The main source of uncertainty in this
   transaction is whether delevering from unscheduled principal
   proceeds will continue and at what pace. Delevering may
   accelerate due to high prepayment levels in the loan market
   and/or collateral sales by the manager, which may have
   significant impact on the notes' ratings.

2) Recovery of defaulted assets: Market value fluctuations in
   defaulted assets reported by the trustee and those assumed to
   be defaulted by Moody's may create volatility in the deal's
   overcollateralization levels. Further, the timing of recoveries
   and the manager's decision to work out versus sell defaulted
   assets create additional uncertainties. Moody's analyzed
   defaulted recoveries assuming the lower of the market price and
   the recovery rate in order to account for potential volatility
   in market prices.

3) Weighted average life: The notes' ratings are sensitive to the
   weighted average life assumption of the portfolio, which may be
   extended due to the manager's decision to reinvest into loans
   with longer maturities and/or participate in amend-to-extend
   offerings.

4) Management continuity: GSC Group, Inc. has recently filed a
   motion with the bankruptcy court to sell its investment
   management contracts. Until a new manager is appointed GSC will
   continue to manage the transaction under Chapter 11 protection.
   There is some uncertainty as to whether a new manager will be
   found to take over this transaction and how well a transition
   to a new manager is going to be handled.

The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011.

Moody's modeled the transaction using the Binomial Expansion
Technique, as described in Section 2.3.2.1 of the "Moody's
Approach to Rating Collateralized Loan Obligations" rating
methodology published in June 2011.

The cash flow model used for this transaction, whose description
can be found in the methodology listed above, is Moody's CDOEdge
model.

In addition to the quantitative factors that are explicitly
modeled, qualitative factors are part of the rating committee
considerations. These qualitative factors include the structural
protections in each transaction, the recent deal performance in
the current market environment, the legal environment, specific
documentation features, the collateral manager's track record, and
the potential for selection bias in the portfolio. All information
available to rating committees, including macroeconomic forecasts,
input from other Moody's analytical groups, market factors, and
judgments regarding the nature and severity of credit stress on
the transactions, may influence the final rating decision.

Moody's also notes that around 77% of the collateral pool consists
of debt obligations whose credit quality has been assessed through
Moody's credit estimates. Large single exposures to obligors
bearing a credit estimate have been subject to a stress applicable
to concentrated pools as per the report titled "Updated Approach
to the Usage of Credit Estimates in Rated Transactions" published
in October 2009.


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


CHAPEL 2003: S&P Lowers Rating on Class C Notes to 'CCC'
--------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
all classes of notes in Chapel 2003-I B.V. and Chapel 2007 B.V.
"At the same time, we have kept our ratings on CreditWatch
negative due to our view of continued risks surrounding duty of
care claims," S&P stated.

"The downgrades have resulted from the transactions' deteriorating
credit performance, an analysis of potential set off as a result
of duty of care claims, and the application of our 2010
counterparty criteria," S&P said.

Chapel 2003 and 2007 closed in December 2003 and April 2007, and
securitize secured and unsecured consumer loans originated by the
now insolvent DSB Bank N.V. in The Netherlands. Both transactions'
asset pools have amortized since closing, resulting in pool
factors of 40% and 80% for Chapel 2003 and 2007.

                         Credit Risk

"On Nov. 17, 2010 we placed the ratings in both transactions on
CreditWatch negative due to worsening performance and our
assessment of the potential risk of set off arising from claims
involving breaches of duty of care owed by the originator to the
borrowers," S&P related.

Since then the transactions have continued to draw on their
reserve funds, which now stand at zero for Chapel 2003 and at
EUR9,819,668 -- 47% of its target level -- for Chapel 2007. As a
result, a cumulative uncleared principal deficiency ledger of
EUR5,005,156 has built up over the last two payment dates
in Chapel 2003," S&P added.

According to the investor report, short-term delinquency rates
have been reigned in following the spike observed after DSB Bank's
insolvency, although longer-term arrears have continued to accrue.

"We have taken these factors into account in our decision to
downgrade each class of notes, as well as the decision to keep the
ratings on CreditWatch negative," S&P said.

                    Potential Due Care Claims

The asset pools in both transactions contain a significant
proportion of loans whose borrowers are alleging due care failures
with respect to the selling of accompanying insurance products and
overextension of credit.

Accompanying insurance products included sickness and unemployment
insurance as well as savings products designed to help borrowers
meet bullet payments on interest-only loans at maturity. The
alleged claims relate to miss-selling and miss-pricing of such
products as well as due care failures.

"DSB Bank's bankruptcy administrator has provided us with data on
the amounts of single-premium insurance policies subscribed to by
borrowers having outstanding loans in the Chapel transactions. The
percentage of the pool exposed to these claims is 26.7% in Chapel
2003 and 21.2% in Chapel 2007," S&P said.

The bankruptcy administrator has indicated that any compensation
borrowers may receive as a result of due care claims will be set
off against the borrowers' outstanding loan balances. "The
bankruptcy administrator has also informed us that affected
borrowers will receive compensation whether or not they have
filed a duty of care claim," according to S&P.

"Although there is uncertainty surrounding the ultimate level of
compensation that could be awarded to borrowers based on these
claims, we have assumed in our analysis a potential compensation
scenario of 45% of the single-premium insurance policy amount,
which would result in a set-off amount of 12.03% of the current
pool balance being applied to Chapel 2003 and 9.55% being applied
to Chapel 2007. The amount that may ultimately be awarded is a
matter to be determined by the Dutch courts. We have not been
advised when the court's judgment is expected, although we have
assumed in our analysis that it may be handed down in the short
term, with the impact on the transactions' cash flows following
shortly afterwards. We understand that the issuer might claim
against the DSB Bank estate in the event of such set-off; however;
there remains uncertainty as to the success and amount of any such
a claim," S&P related.

"The potential set-off claims were a factor in the downgrades.
Additionally, we have kept the ratings on CreditWatch negative
partly due to the continuing uncertainty regarding these claims,
with further rating action likely once the judgment is made," S&P
said.

                        Counterparty Risk

"On Jan. 18, 2011, we placed our ratings on CreditWatch negative
on Chapel 2003's class A notes and Chapel 2007's class A1 to C
notes when our 2010 counterparty criteria became effective (see
'EMEA Structured Finance CreditWatch Actions In Connection With
Revised Counterparty Criteria,' published Jan. 18, 2011)," S&P
noted.

"Following our analysis, we have capped our rating on Chapel
2007's class A1 notes at 'A (sf)' because we do not consider the
transaction complies with our 2010 counterparty criteria (see
'Counterparty And Supporting Obligations Methodology And
Assumptions,' published on Dec. 6, 2010)," S&P related.

Specifically, the interest rate swap and liquidity provider
documentation is not in compliance with our 2010 counterparty
criteria. As a result, according to our criteria the notes are
capped at the long-term issuer credit rating on the transaction's
counterparty ABN AMRO Bank N.V. (A/Stable/A-1).

"We have consequently taken this cap into consideration in today's
downgrade of Chapel 2007's class A1 notes. The ratings on classes
A2 to F are below the counterparty's issuer credit rating and as a
result we do not consider them to be affected by the 2010
counterparty criteria," S&P said.

"For Chapel 2003, the ratings on each class of notes are now below
the counterparty's issuer credit rating and so we do not consider
them to be affected by the 2010 counterparty criteria," S&P added.

                             Servicing

"We understand that DSB Bank's bankruptcy trustee has entered into
a sub-delegation agreement with the servicing company Quion
Services B.V. to take over the servicing of DSB Bank's portfolios
for an initial period of five years. Quion will assume
responsibility for all aspects of servicing, except for client
handling relating to due care claims, subject to noteholder
approval," S&P noted.

"We understand that the target date for Quion to assume this
responsibility is May 2012," S&P related.

"Quion's servicing fees are not yet publicly available, although
we expect to be updated when fees are agreed and made public. We
expect the fee will be higher than a standard servicing fee in
light of the fact that DSB Bank is insolvent," S&P added.

Ratings List

Class            Rating
          To                        From

Chapel 2003-I B.V
EUR1 Billion Floating-Rate Asset-Backed Notes

Ratings Lowered and Kept on CreditWatch

A        BBB+ (sf)/Watch Neg     AAA (sf)/Watch Neg
B        B (sf)/Watch Neg        AA (sf)/Watch Neg
C        CCC (sf)/Watch Neg      A (sf)/Watch Neg

Chapel 2007 B.V.
EUR710.7 Million Asset-Backed Floating-Rate Notes and Excess-
Spread-Backed Notes

Ratings Lowered and Kept On CreditWatch

A1       A (sf)/Watch Neg        AAA (sf)/Watch Neg
A2       BBB+ (sf)/Watch Neg     AAA (sf)/Watch Neg
B        BBB- (sf)/Watch Neg     AAA (sf)/Watch Neg
C        BB (sf)/Watch Neg       AA (sf)/Watch Neg
D        CCC (sf)/Watch Neg      A (sf)/Watch Neg
E        CCC (sf)/Watch Neg      BBB+ (sf)/Watch Neg
F        CCC (sf)/Watch Neg      B- (sf)/Watch Neg


CHAPEL 2007: S&P Lowers Rating on Three Classes of Notes to 'CCC'
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
all classes of notes in Chapel 2003-I B.V. and Chapel 2007 B.V.
"At the same time, we have kept our ratings on CreditWatch
negative due to our view of continued risks surrounding duty of
care claims," S&P stated.

"The downgrades have resulted from the transactions' deteriorating
credit performance, an analysis of potential set off as a result
of duty of care claims, and the application of our 2010
counterparty criteria," S&P said.

Chapel 2003 and 2007 closed in December 2003 and April 2007, and
securitize secured and unsecured consumer loans originated by the
now insolvent DSB Bank N.V. in The Netherlands. Both transactions'
asset pools have amortized since closing, resulting in pool
factors of 40% and 80% for Chapel 2003 and 2007.

                         Credit Risk

"On Nov. 17, 2010 we placed the ratings in both transactions on
CreditWatch negative due to worsening performance and our
assessment of the potential risk of set off arising from claims
involving breaches of duty of care owed by the originator to the
borrowers," S&P related.

Since then the transactions have continued to draw on their
reserve funds, which now stand at zero for Chapel 2003 and at
EUR9,819,668 -- 47% of its target level -- for Chapel 2007. As a
result, a cumulative uncleared principal deficiency ledger of
EUR5,005,156 has built up over the last two payment dates
in Chapel 2003," S&P added.

According to the investor report, short-term delinquency rates
have been reigned in following the spike observed after DSB Bank's
insolvency, although longer-term arrears have continued to accrue.

"We have taken these factors into account in our decision to
downgrade each class of notes, as well as the decision to keep the
ratings on CreditWatch negative," S&P said.

                    Potential Due Care Claims

The asset pools in both transactions contain a significant
proportion of loans whose borrowers are alleging due care failures
with respect to the selling of accompanying insurance products and
overextension of credit.

Accompanying insurance products included sickness and unemployment
insurance as well as savings products designed to help borrowers
meet bullet payments on interest-only loans at maturity. The
alleged claims relate to miss-selling and miss-pricing of such
products as well as due care failures.

"DSB Bank's bankruptcy administrator has provided us with data on
the amounts of single-premium insurance policies subscribed to by
borrowers having outstanding loans in the Chapel transactions. The
percentage of the pool exposed to these claims is 26.7% in Chapel
2003 and 21.2% in Chapel 2007," S&P said.

The bankruptcy administrator has indicated that any compensation
borrowers may receive as a result of due care claims will be set
off against the borrowers' outstanding loan balances. "The
bankruptcy administrator has also informed us that affected
borrowers will receive compensation whether or not they have
filed a duty of care claim," according to S&P.

"Although there is uncertainty surrounding the ultimate level of
compensation that could be awarded to borrowers based on these
claims, we have assumed in our analysis a potential compensation
scenario of 45% of the single-premium insurance policy amount,
which would result in a set-off amount of 12.03% of the current
pool balance being applied to Chapel 2003 and 9.55% being applied
to Chapel 2007. The amount that may ultimately be awarded is a
matter to be determined by the Dutch courts. We have not been
advised when the court's judgment is expected, although we have
assumed in our analysis that it may be handed down in the short
term, with the impact on the transactions' cash flows following
shortly afterwards. We understand that the issuer might claim
against the DSB Bank estate in the event of such set-off; however;
there remains uncertainty as to the success and amount of any such
a claim," S&P related.

"The potential set-off claims were a factor in the downgrades.
Additionally, we have kept the ratings on CreditWatch negative
partly due to the continuing uncertainty regarding these claims,
with further rating action likely once the judgment is made," S&P
said.

                        Counterparty Risk

"On Jan. 18, 2011, we placed our ratings on CreditWatch negative
on Chapel 2003's class A notes and Chapel 2007's class A1 to C
notes when our 2010 counterparty criteria became effective (see
'EMEA Structured Finance CreditWatch Actions In Connection With
Revised Counterparty Criteria,' published Jan. 18, 2011)," S&P
noted.

"Following our analysis, we have capped our rating on Chapel
2007's class A1 notes at 'A (sf)' because we do not consider the
transaction complies with our 2010 counterparty criteria (see
'Counterparty And Supporting Obligations Methodology And
Assumptions,' published on Dec. 6, 2010)," S&P related.

Specifically, the interest rate swap and liquidity provider
documentation is not in compliance with our 2010 counterparty
criteria. As a result, according to our criteria the notes are
capped at the long-term issuer credit rating on the transaction's
counterparty ABN AMRO Bank N.V. (A/Stable/A-1).

"We have consequently taken this cap into consideration in today's
downgrade of Chapel 2007's class A1 notes. The ratings on classes
A2 to F are below the counterparty's issuer credit rating and as a
result we do not consider them to be affected by the 2010
counterparty criteria," S&P said.

"For Chapel 2003, the ratings on each class of notes are now below
the counterparty's issuer credit rating and so we do not consider
them to be affected by the 2010 counterparty criteria," S&P added.

                             Servicing

"We understand that DSB Bank's bankruptcy trustee has entered into
a sub-delegation agreement with the servicing company Quion
Services B.V. to take over the servicing of DSB Bank's portfolios
for an initial period of five years. Quion will assume
responsibility for all aspects of servicing, except for client
handling relating to due care claims, subject to noteholder
approval," S&P noted.

"We understand that the target date for Quion to assume this
responsibility is May 2012," S&P related.

"Quion's servicing fees are not yet publicly available, although
we expect to be updated when fees are agreed and made public. We
expect the fee will be higher than a standard servicing fee in
light of the fact that DSB Bank is insolvent," S&P added.

Ratings List

Class            Rating
          To                        From

Chapel 2003-I B.V
EUR1 Billion Floating-Rate Asset-Backed Notes

Ratings Lowered and Kept On CreditWatch

A        BBB+ (sf)/Watch Neg     AAA (sf)/Watch Neg
B        B (sf)/Watch Neg        AA (sf)/Watch Neg
C        CCC (sf)/Watch Neg      A (sf)/Watch Neg

Chapel 2007 B.V.
EUR710.7 Million Asset-Backed Floating-Rate Notes and Excess-
Spread-Backed Notes

Ratings Lowered and Kept on CreditWatch

A1       A (sf)/Watch Neg        AAA (sf)/Watch Neg
A2       BBB+ (sf)/Watch Neg     AAA (sf)/Watch Neg
B        BBB- (sf)/Watch Neg     AAA (sf)/Watch Neg
C        BB (sf)/Watch Neg       AA (sf)/Watch Neg
D        CCC (sf)/Watch Neg      A (sf)/Watch Neg
E        CCC (sf)/Watch Neg      BBB+ (sf)/Watch Neg
F        CCC (sf)/Watch Neg      B- (sf)/Watch Neg


GRESHAM CLO: Moody's Confirms Rating on Class F Notes at 'Ca (sf)'
------------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of the
following notes issued by Gresham CLO III:

Issuer: Gresham CLO III

   -- EUR60M Class A-2 Senior Secured Floating Rate Notes due
      2021, Upgraded to Aa2 (sf); previously on Jun 22, 2011 Aa3
      (sf) Placed Under Review for Possible Upgrade

   -- EUR51M Class B Senior Secured Floating Rate Notes due 2021,
      Upgraded to A2 (sf); previously on Jun 22, 2011 Baa1 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR34M Class C Senior Secured Deferrable Floating Rate Notes
      due 2021, Upgraded to Baa3 (sf); previously on Jun 22, 2011
      Ba2 (sf) Placed Under Review for Possible Upgrade

   -- EUR31M Class D Senior Secured Deferrable Floating Rate Notes
      due 2021, Upgraded to Ba2 (sf); previously on Jun 22, 2011
      B2 (sf) Placed Under Review for Possible Upgrade

   -- EUR33M Class E Senior Secured Deferrable Floating Rate Notes
      due 2021, Upgraded to B3 (sf); previously on Jun 22, 2011
      Caa3 (sf) Placed Under Review for Possible Upgrade

   -- EUR12M Class F Senior Secured Deferrable Floating Rate Notes
      due 2021, Confirmed at Ca (sf); previously on Jun 22, 2011
      Ca (sf) Placed Under Review for Possible Upgrade

RATING RATIONALE

Gresham CLO III, issued in December 2006, is a multi currency
Collateralised Loan Obligation ("CLO") backed by a portfolio of
mostly high yield European loans. The portfolio is managed by
Investec Bank PLC. This transaction will be in the reinvestment
period until 13 March 2012. It is predominantly composed of senior
secured loans.

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011.

The actions reflect key changes to the modeling assumptions, which
incorporate (1) a removal of the temporary 30% default probability
macro stress implemented in February 2009, (2) increased BET
liability stress factors as well as (3) change to a fixed recovery
rate modeling framework.

Moody's also notes that this action also reflects improvements of
the transaction performance since the last rating action. In
Moody's view, positive developments coincide with reinvestment of
sale proceeds (including higher than previously anticipated
recoveries realized on defaulted securities) into substitute
assets with higher par amounts and/or higher ratings.

Improvement in the credit quality is observed through a stronger
average credit rating of the portfolio (as measured by the
weighted average rating factor "WARF") and a decrease in the
proportion of securities from issuers rated Caa1 and below. In
particular, as of the latest trustee report dated June 2011, the
WARF is currently 2793 compared to 2850 in the November 2009
report, and securities rated Caa or lower make up approximately
13.08% of the underlying portfolio versus 17.42% in November 2009.

The decrease in reported WARF understates the actual credit
quality improvement because of the technical transition related to
rating factors of European corporate credit estimates, as
announced in the press release published by Moody's on
September 1, 2010.

Due to the impact of revised and updated key assumptions
referenced in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011, key model inputs used by
Moody's in its analysis, such as the portfolio par amount, WARF,
diversity score, and weighted average recovery rate, may be
different from the trustee's reported numbers. In its base case,
Moody's analyzed the underlying collateral pool to have a
performing par and principal proceeds balance of EUR 529.0
million, defaulted par of EUR 0million, a weighted average default
probability of 20.7% consistent with a WARF of 3047, a weighted
average recovery rate upon default of 46.58%, and a diversity
score of 39. The default probability is derived from the credit
quality of the collateral pool and Moody's expectation of the
remaining life of the collateral pool. The average recovery rate
to be realized on future defaults is based primarily on the
seniority of the assets in the collateral pool. For a Aaa
liability target rating, Moody's assumed that 88.6% of the
portfolio exposed to senior secured corporate assets would recover
50% upon default, while the remainder non first-lien loan
corporate assets would recover 10%. In each case, historical and
market performance trends and collateral manager latitude for
trading the collateral are also relevant factors. These default
and recovery properties of the collateral pool are incorporated in
cash flow model analysis where they are subject to stresses as a
function of the target rating of each CLO liability being
reviewed.

The deal is allowed to reinvest and the manager has the ability to
deteriorate the collateral quality metrics' existing cushions
against the covenant levels. However, in this case given the
limited time remaining in the deal's reinvestment period, Moody's
analysis reflects the benefit of assuming a higher likelihood that
certain collateral pool characteristics will continue to maintain
a positive "cushion" relative to the covenant requirements, as
seen in the actual collateral quality measurements. Moody's
analyzed the impact of assuming weighted average spread consistent
with the midpoint between reported and covenanted values.

Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, as evidenced by 1) uncertainties of
credit conditions in the general economy and 2) the large
concentration of speculative-grade debt maturing between 2012 and
2014 which may create challenges for issuers to refinance. CDO
notes' performance may also be impacted by 1) the manager's
investment strategy and behavior and 2) divergence in legal
interpretation of CDO documentation by different transactional
parties due to embedded ambiguities.

The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011.

Moody's modeled the transaction using the Binomial Expansion
Technique, as described in Section 2.3.2.1 of the "Moody's
Approach to Rating Collateralized Loan Obligations" rating
methodology published in June 2011.

The cash flow model used for this transaction, whose description
can be found in the methodology listed above, is Moody's EMEA
Cash-Flow model.

In addition to the quantitative factors that are explicitly
modeled, qualitative factors are part of the rating committee
considerations. These qualitative factors include the structural
protections in each transaction, the recent deal performance in
the current market environment, the legal environment, specific
documentation features, the collateral manager's track record, and
the potential for selection bias in the portfolio. All information
available to rating committees, including macroeconomic forecasts,
input from other Moody's analytical groups, market factors, and
judgments regarding the nature and severity of credit stress on
the transactions, may influence the final rating decision.

Moody's also notes that around 68% of the collateral pool consists
of debt obligations whose credit quality has been assessed through
Moody's credit estimates.


HARBOURMASTER CLO: Fitch Withdraws Low-B Ratings on Combo Notes
---------------------------------------------------------------
Fitch Ratings has withdrawn several Harbourmaster CLOs combination
notes' ratings. The combination notes have been exchanged for
their underlying component notes, and subsequently cancelled. The
rating actions are:

Harbourmaster CLO 6 B.V.:

   -- Class S2 combination notes (XS0234259470): 'BBBsf' Outlook
      Negative; withdrawn

Harbourmaster CLO 9 B.V.:

   -- Class S-Combo notes (XS0296313447): 'B+sf' Rating Watch
      Negative; withdrawn

Harbourmaster Pro-Rata CLO 3 B.V.:

   -- Class S2 combination notes (XS0306980706): 'BBsf' Rating
      Watch Negative; withdrawn


OPERA FINANCE: Moody's Lowers Rating on Class A Notes to 'B3 (sf)'
------------------------------------------------------------------
Moody's Investors Service has downgraded the Class A Notes issued
by Opera Finance (Uni-Invest) B.V. (amount reflects initial
outstandings):

   -- EUR656M A Notes, Downgraded to B3 (sf); previously on Feb
      16, 2011 Baa2 (sf) Placed Under Review for Possible
      Downgrade

Moody's does not rate the Classes B, C, D issued by Opera Finance
(Uni-Invest) B.V.

RATINGS RATIONALE

The key parameters in Moody's analysis are the expected work-out
process and related costs during the remaining period until final
legal maturity, as well as Moody's value assessment for the
properties securing this loan. Moody's derives from those
parameters the level of expected recoveries for the securitized
loan.

The rating action is prompted by (i) the recent failure of a
Noteholder steering committee to reach consensus in respect of
bids on the company and its assets; (ii) concerns that the Special
Servicer may not be able to execute a disposition strategy within
the limited timeframe remaining until the final legal maturity in
February 2012 and (iii) the increased likelihood of depressed
recovery proceeds stemming from a distressed/ fire sale process
given the limited time.

According to a notice on June 27, 2011, the Special Servicer
continues to consider all its options including a company sale via
an enforcement process. At present and as long as the whole loan
is not accelerated and enforced, future disposal proceeds will be
predominately applied pro-rata at the Notes level. However, in
Moody's opinion the Special Servicer is likely to opt for a
Company sale via the enforcement route which would result in a
sequential distribution of proceeds to noteholders.

According to a July 8, special notice from the newly appointed
operating advisor (acting on behalf of the controlling Class D
Noteholders), a meeting is scheduled to be held for Class D
Noteholders on July 27, 2011. As per transaction documents, the
timing of ultimate disposition via an enforcement process could be
delayed by the operating advisor in case they object to the
Special Servicer's strategy or opt to even replace the existing
Special Servicer. However, based on the limited remaining time
until Feb 2012 and complex transaction documentation, it seems
uncertain whether a new Special Servicer would be willing to step-
in or even whether they would garner the required majority votes
(75%) necessary for such an action. In any case, in Moody's view,
the existing Special Servicer is likely to act according to the
Servicing Standards should a conflict arise following a proposal
by the operating advisor.

The most recent CBRE valuation of the portfolio at EUR633.6
million indicates a further 27% decline in the market value on a
like-for-like basis compared to the previous valuation in November
2009. The value plummets to EUR400 million under a fire sale
scenario over the next six months. In Moody's view, the expected
loss for the Class A Notes has increased substantially compared to
the previous transaction review. The current rating reflects the
expected recovery of principal and interest, as well as the
uncertainty around that expectation. Based on Moody's current
assumption of a disposition of company shares or its assets at a
distressed or fire sale price level, a high recovery rate (ranging
95% to 97%) is expected for the Class A Noteholders. As Moody's
recognizes the importance of the Special Servicer's next steps,
especially as it relates to timing and related costs, the current
rating of Class A Notes might still be exposed to potential
further volatility. All other classes of Notes are expected to
suffer a substantial to full principal loss at the final
determination date.

Opera Finance (Uni-Invest) B.V. is a true sale single loan
transaction that closed in May 2005. The securitized loan is the
senior portion of a senior/junior loan (together the "whole loan")
structure secured by first-ranking security over initially 321
commercial properties all located in The Netherlands. By May 2011,
117 properties had been disposed of (26 since loan maturity in Feb
2010). The predominant property types are office and industrial.
The current senior loan balance is EUR609.3 million and the junior
loan balance is EUR142.3 million. Based on the updated market
value the underwriter loan-to-value is 119% on a whole loan basis
and 96% based on the securitized balance. As per last IPD, the
total size of Class A Notes amounts to EUR365.2 million.

RATING METHODOLOGY

The principal methodology used in this rating was "Moody's
Approach to Real Estate Analysis for CMBS in EMEA: Portfolio
Analysis (MORE Portfolio)" published April 2006. Other methodology
and factors considered can be found in "Update on Moody's Real
Estate Analysis for CMBS Transactions in EMEA" published June
2005.

For this rating review, Moody's also took into account Moody's
Global Credit Policy guidance as per report released on
www.moodys.com: "Moody's Approach to Rating Structured Finance
Securities in Default" published November 2009.

The updated assessment is a result of Moody's on-going
surveillance of commercial mortgage backed securities (CMBS)
transactions. Moody's prior full review is summarized in a Press
Release dated March 16, 2010. The last Performance Overview for
this transaction was published on February 23, 2011.


===========
N O R W A Y
===========


SEVAN MARINE: May File for Bankruptcy if Restructuring Fails
------------------------------------------------------------
Marianne Stigset at Bloomberg News reports that Sevan Marine ASA
said it is undertaking a restructuring effort, which will involve
a restructuring of its debts.

"The restructuring, if successful, will substantially dilute
existing shareholders in the company, and if unsuccessful, the
company will most likely have to file for bankruptcy," Bloomberg
quotes Sevan Marine as saying in an information memorandum
published in relation to the listing of the company.

As reported by the Troubled Company Reporter-Europe on July 12,
2011, Bloomberg News related that Sevan Marine proposed to defer
debt interest payments to stave off bankruptcy.  Sevan Marine said
in a statement that the company plans to defer interest payments
on secured debt until at least September and convert unsecured
bonds to equity, Bloomberg disclosed.  Sevan Marine, as cited by
Bloomberg, said that the company will seek to raise at least
US$200 million in a share sale aimed at bondholders and a rights
offer for existing shareholders.

Arendal, Norway-based Sevan Marine ASA is a maker of floating oil-
production and storage vessels.


===============
P O R T U G A L
===============


BPN-BANCO PORTUGUES: Banco BIC to Make Buyout Offer Today
---------------------------------------------------------
Henrique Almeida at Bloomberg News reports that Fernando Teles,
Banco BIC Angola's chief executive, said the southern African
country's fourth biggest bank will make an offer to buy failed
Portuguese lender BPN-Banco Portugues de Negocios SA today,
July 20.

Mr. Teles declined to provide details on the terms of the offer in
a telephone interview, Bloomberg notes.

Banco BIC has operations in Angola, and Banco BIC Portugues SA,
controlled by the same shareholders, operates in Portugal,
Bloomberg discloses.

As reported by the Troubled Company Reporter-Europe on July 1,
2011, Bloomberg News related that Mr. Teles said Banco BIC hired
consulting company Deloitte to advise it on the acquisition of
BPN.  Portugal seized BPN in 2008 and failed to sell the lender's
retail business last year for a minimum price of EUR180 million
(US$259 million), Bloomberg recounted.

Based in Lisbon, Portugal, BPN-Banco Portugues de Negocios SA
provides banking services, as well as advice on economic and
financial valuation studies, and corporate reorganizations to
companies and institutional investors.


* PORTUGAL: Moody's Lowers Debt Ratings of Seven Banks
------------------------------------------------------
Moody's Investors Service has downgraded the debt ratings of seven
Portuguese banks.

The rating actions were triggered by the downgrade of the rating
of the Republic of Portugal to Ba2 from Baa1 last week.

These banks have been downgraded:

  (i) Caixa Geral de Depositos ("CGD"): long-and short-term senior
      unsecured debt and deposit ratings were downgraded to
      Ba1/Not-Prime from Baa1/Prime-2.

(ii) Banco Espirito Santo ("BES"): downgraded to Ba1/NP from
      Baa2/P-2.

(iii) Espirito Santo Financial Group ("ESFG"): downgraded to
      Ba2/NP from Baa1/P-2.

(iv) Banco Comercial Portugues ("BCP"): downgraded to Ba1/NP from
      Baa3/P-3.

  (v) Banco BPI ("BPI"): downgraded to Baa3/P-3 from Baa2/P-2.

(vi) Banco Santander Totta ("BST"): downgraded to Baa1/P-2 from
      A3/P-2; BST's standalone BFSR downgraded to D+/Baa3 from C-
      /Baa2.

(vii) Caixa Economica Montepio Geral ("Montepio"): downgraded to
      Ba2/NP from Ba1/NP.

At the same time, the downgrade of the banks' debt ratings also
triggered a downgrade of most of the banks' dated and junior
subordinated debt and preference share ratings.

All these banks' debt, standalone and prime short-term ratings
remain on review for possible downgrade, pending the finalization
of their deleveraging plans which they are currently discussing
with Portuguese and European authorities.

Separately, the ratings of these three banks are unaffected by the
rating action:

- Banco Itau BBA International ("Itau"), rated Baa2/P-2/D+
  (mapping to Baa3 on the long-term scale).

- Banco Internacional do Funchal ("Banif"), rated Ba2/NP/D-
  (mapping to Ba3 on the long-term scale).

- Banco Portugues de Negocios ("BPN"), rated B1/NP/E (mapping to
  Caa1 on the long-term scale)

Itau's ratings are not under review for possible downgrade,
whereas the review for possible downgrade continues for Banif.

RATIONALE FOR DOWNGRADES OF DEBT AND FINANCIAL STRENGTH RATINGS

The rating action on Portuguese banks has been driven by the
downgrade of the Republic of Portugal on July 5, 2011. (Please see
"Moody's downgrades Portugal to Ba2 with a negative outlook from
Baa1").

Moody's downgrade of the Republic of Portugal to Ba2 implies a
weakened ability of the Portuguese government to support its
banking system. Moody's therefore assumes that the possibility of
support from the government could not take a bank's rating to more
than one notch above the government rating of Ba2, and that only
banks with a standalone financial strength rating at or below the
Republic of Portugal's Ba2 rating could therefore benefit from
ongoing government support.

The banks whose debt ratings are affected by this are:

- CGD, BCP and BES (and indirectly ESFG, its holding company),
  whose debt ratings have been downgraded to Ba1 (Ba2 for ESFG
  reflecting structural subordination to its operating company
  BES).

- BPI, which has been downgraded to Baa3, the same level as its
  standalone rating (D+/Baa3).

- Montepio, whose downgrade to Ba2 is a reflection of both its
  lower standalone rating at D/Ba2 and of its lower systemic
  importance in Moody's view, as compared to CGD, BES and BCP.

Only Banif retains its current level of support, which is
providing uplift for its debt rating to Ba2 from its standalone
rating of D-/Ba3.

Moody's has also downgraded the BFSR of Banco Santander Totta by
one notch to D+/Baa3 from C-/Baa2. While the review for downgrade
referred to below will assess the wider implications of the
sovereign downgrade for Portuguese banks' standalone strength,
Moody's is of the opinion that the rising pressures on asset
quality, profitability, liquidity and capital levels that Moody's
sees as likely consequences of the government austerity measures,
are limiting the standalone strength of banks to be not more than
two notches above the sovereign rating of Ba2. Banco Santander
Totta's debt ratings continue to incorporate two notches of
support from its parent, Banco Santander S.A., (rated Aa2/ B-
mapping to A1 on the long-term rating scale; negative outlook).

RATIONALE FOR CONTINUED REVIEW FOR DOWNGRADE OF DEBT AND FINANCIAL
STRENGTH RATINGS

All the above standalone financial strength and long-term debt
ratings (including the ratings of Banif and the Prime short-term
ratings of BPI and BST) remain under review for downgrade until
the review of these banks' standalone financial strength rating
can be concluded.

The ongoing review on all banks' standalone financial strength
ratings will focus on the deleveraging plans currently under
discussion between the banks and Portuguese and EU authorities and
will be key to determining the banks' capital and funding
strategies over the short to medium term. Moody's expects these
plans to be finalised over the next couple of months, which should
allow the rating agency to conclude the reviews in the first half
of September.

Moody's review will also take into account the following factors,
as previously highlighted in its press release of 7 July 2011: (i)
the magnitude of banks' direct exposure to government debt; (ii)
their exposure to risk factors that are interrelated with the
sovereign's credit risk, such as market confidence and access to
market funding; (iii) the high degree of correlation between the
macroeconomic factors that affect financial institutions' asset
quality and the sovereign's financial health, which can be partly
mitigated by geographical diversification.

The review will incorporate any further news regarding the support
that is likely to be available to Portuguese banks from either the
Portuguese government or other European authorities.

The ratings of BPN will be reviewed separately, once the
privatisation process of the bank has been concluded. BPN's weak
standalone profile at E/Caa1 already reflects very weak credit
fundamentals and is unlikely to drop further, provided that the
government maintains its ongoing support for this fully
government-owned entity.

RATING RATIONALE FOR DOWNGRADE OF SENIOR SUBORDINATED DEBT

Moody's has downgraded the senior subordinated debt ratings of
seven banks in line with the downgrade of these banks' senior
unsecured debt ratings. Moody's has not yet removed systemic
support for the senior subordinated debt issuances in Portugal,
but expects to also assess this during the current review. If, at
that point, Moody's assessment results in the partial or full
removal of systemic support for subordinated debt, then the rating
agency would consider further downgrades of this type of debt.

RATING RATIONALE FOR THE DOWNGRADE OF HYBRID INSTRUMENTS

The one notch downgrade of junior subordinated debt of BES, BPI,
Totta and Montepio -- for which no systemic support is
incorporated -- to one notch below the dated subordinated debt
reflects the risk differentiation between junior subordinated debt
and dated subordinated debt due to the legal subordination of
junior subordinated debt.

In the case of CGD, the junior subordinated debt and preference
share ratings have been affected by the downgrade of the
Portuguese sovereign, since Moody's incorporates support from the
sovereign for all classes of debt instruments due to the parental
role of the Portuguese government. They are now notched off the
Ba1 rating of CGD.

All of these ratings also remain on review for possible downgrade

METHODOLOGIES USED

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 Lisbon, Portugal, CGD reported total unaudited
consolidated assets of EUR123.5 billion as of March 31, 2011.

Headquartered in Lisbon, Portugal, BES reported total unaudited
consolidated assets of EUR80.7 billion as of March 31, 2011.

Headquartered in Oporto, Portugal, BCP reported total unaudited
consolidated assets of EUR96.6 billion as of March 31, 2011.

Headquartered in Lisbon, Portugal, BPI reported total unaudited
consolidated assets of EUR44.2 billion as of March 31, 2011.

Headquartered in Lisbon, Portugal, BST reported total unaudited
consolidated assets of EUR48.8 billion as of March 31, 2011.

Headquartered in Funchal, Portugal, Banif reported total audited
consolidated assets of EUR12.4 billion as of December 31, 2010.

Headquartered in Lisbon, Portugal, Montepio reported total audited
consolidated assets of EUR18.2 billion as of December 31, 2010.

Headquartered in Luxembourg, ESFG reported total unaudited
consolidated assets of EUR84.1 billion as of March 31, 2011.

Headquartered in Lisbon, Portugal, Itau reported total unaudited
consolidated assets of EUR5.2 billion as of March 31, 2011.

Headquartered in Lisbon, Portugal, BPN reported total audited
consolidated assets of EUR7.0 billion as of December 31, 2010.


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


PROCREDIT BANK: Fitch Affirms Issuer Default Rating at 'B-'
-----------------------------------------------------------
Fitch Ratings has affirmed ProCredit Bank (Kosovo)'s (PCBK) Long-
term foreign currency Issuer Default Rating (IDR) at 'B-' with a
Stable Outlook and Individual Rating at 'D'.

The IDRs and Support Rating reflect Fitch's view of the potential
support available from the bank's owners, in particular Frankfurt-
based ProCredit Holding AG (PCH; 'BBB-'/Stable) which at end-May
2011 had total assets of EUR5.03bn. PCH is the largest
shareholder, with a stake of 83% at end-June 2011. PCH'S IDRs and
Support Ratings in turn reflect the agency's view of the potential
support available from its institutional shareholders, in
particular from a group of international financial institutions
(IFIs), which are key voting shareholders.

The potential support for PCBK, and hence its Support Rating and
foreign currency IDRs, are constrained by Fitch's assessment of
currency transfer risk in Kosovo. Consequently, PCBK's ratings
could be upgraded or downgraded if Fitch's view of this risk
changed.

PCBK's Individual Rating reflects the high-risk operating
environment and significant interest-rate risk. Downward pressure
on the bank's Individual Rating could result from a worsening of
the political and economic situation and any ensuing deterioration
in asset quality, performance and capitalization.

However, the Individual Rating is supported by PCBK's leading
domestic franchise, which underpins its performance, and its well-
established deposit base. The capital base has also been
strengthened and provides a moderate buffer to absorb further
asset quality losses.

In addition, PCBK's Individual Rating reflects its sound
management, solid corporate governance and robust risk management
systems and practices ensuing from its participation in the
ProCredit group of banks.

The rating actions are:

PCBK:

   -- Long-term foreign currency Issuer Default Rating (IDR):
      affirmed at 'B-'; Outlook Stable

   -- Short-term foreign currency IDR: affirmed at 'B'

   -- Individual Rating affirmed at 'D'

   -- Support Rating: affirmed at '5'


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


BBVA CONSUMO: S&P Lowers Rating on Class B Notes to 'BB-'
---------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit rating on BBVA Consumo 3 Fondo de
Titulizacion de Activos' class B notes. "At the same time,
we lowered our rating on the class A notes," S&P said.

"On May 3, 2011, we affirmed the rating on BBVA Consumo 3's class
A notes, and placed the rating on the class B notes on CreditWatch
negative due to deteriorating levels of credit enhancement (see
'Various Rating Actions Taken In Spanish ABS Transactions BBVA
Consumo 1, BBVA Consumo 2, And BBVA Consumo 3')," S&P related.

BBVA Consumo 3 closed in April 2008 and its revolving period ended
one year ahead of the February 2010 scheduled due date, due to a
breach of the 90-day delinquency early-amortization trigger of
2.2%.

The current outstanding balance is about 44% of the closing
balance. Even though the transaction's amortization features have
increased the level of credit enhancement for the class A notes,
an increase in the level of defaults has resulted in a depletion
of the transaction's reserve fund since August 2009, which is
currently at 40% of its required level.

As of May 2011, loans more than three months in arrears and not
yet defaulted accounted for 2.37% of the outstanding balance. The
current level of the cash reserve is 1.84% of the notes'
outstanding principal, compared with 2.30% at closing.

The cumulative level of defaults since closing (including
interest), based on the original balance of the portfolio, stands
at 5.28%. "As a result, we have revised upwards our base case
gross loss assumptions. The class B interest-deferral trigger is
set at 8.80%. We have also revised downwards our recovery rate
base-case assumption to 12%, as a result of lower recoveries
observed in the transaction. These factors have also lowered the
level of credit enhancement available to the class B notes," S&P
stated.

"Based on the review of our credit analysis assumptions in terms
of default and recoveries, and taking into account the current
level of support available to the class A notes in the capital
structure, our cash flow analysis indicates that a 'AA (sf)'
rating is appropriate for the class A notes. We have consequently
lowered to 'AA (sf)' from 'AA+ (sf)' our rating on this class,"
S&P related.

The level of credit enhancement available to the class B notes has
significantly decreased since closing. "Based on the insufficient
credit enhancement available to support a 'BBB (sf)' rating in our
cash flow analysis, we have lowered to 'BB- (sf)' from 'BBB (sf)'
and removed from CreditWatch negative our rating on the class B
notes. However, we believe that the notes are not vulnerable to
nonpayment of interest in the short term," S&P said.

The portfolio backing this Spanish asset-backed securities
transaction comprises unsecured consumer loans made to Spanish
residents and originated and serviced by Banco Bilbao Vizcaya
Argentaria, S.A. and BBVA Finanzia.

Ratings List

Class               Rating
           To                    From

BBVA Consumo 3, Fondo de Titulizacion de Activos
EUR1.360 Billion Floating-Rate Notes

Rating Lowered and Removed From CreditWatch Negative

B          BB- (sf)              BBB (sf)/Watch Neg

Rating Lowered

A          AA (sf)               AA+ (sf)


BBVA FINANZIA: S&P Affirms Rating on Class C Notes at 'CCC'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on BBVA Finanzia Autos 1,
Fondo de Titulizacion de Activos' class A and B notes. "At the
same time, we affirmed our rating on the class C notes," S&P said.

"In April 2011, we lowered our rating on BBVA Finanzia Autos 1's
class C notes and placed on CreditWatch negative our ratings on
the class A and B notes, following our preliminary credit
analysis," S&P related.

"We have now performed a full review of the transaction's
collateral performance and structural features, and we have taken
today's rating actions in light of the significant performance
deterioration we have observed in recent months, including rising
cumulative defaults, which now exceed our expectations," S&P
stated.

The current outstanding  balance is about 32.5% of the closing
balance. Even though the transaction's amortization features have
increased the level of credit enhancement for the class A and B
notes, an increase in the level of defaults has resulted in a full
depletion of the transaction's reserve fund since April 2010.
Since then, the reserve fund has not been replenished because the
performing collateral balance has decreased as defaults keep
increasing. Additionally, the transaction did not receive
sufficient excess spread to allocate toward the reserve fund's
replenishment.

The reserve fund's depletion has exposed the class A notes to
principal amortization deficiency. As of the last payment date,
the transaction accumulated EUR3 million of principal deficiency,
which is the difference between the available remaining principal
receipts and the amount of the notes still to be amortized.

The cumulative level of defaults since closing (including
interest), based on the original balance of the portfolio, stands
at 5.52%. "As a result, we have revised upward our base case gross
loss assumptions. The class C interest-deferral trigger is set at
8.5%. We have also revised downward our recovery rate base case
assumption to 16%, as a result of lower recoveries observed in the
transaction. These factors have also lowered the level of credit
enhancement available to the class C notes," S&P said.

"Based on the review of our credit analysis assumptions on
defaults and recoveries, and taking into account the current level
of support available to the class A notes in the capital
structure, our cash flow analysis indicates that a 'A (sf)' rating
is appropriate for the class A notes. We have consequently lowered
to 'A (sf)' from 'AA+ (sf)' and removed from CreditWatch negative
our rating on the class A notes," S&P related.

"Based on the insufficient credit enhancement available to support
a 'A- (sf)' rating in our cash flow analysis, we have lowered to
'BB (sf)' and removed from CreditWatch negative our rating on the
class B notes," S&P said.

"Based on the current weakened level of support and the rising
level of cumulative defaults, our cash flow analysis indicates
that a 'CCC (sf)' rating is appropriate for the class C notes.
Therefore, we have affirmed our rating on the class C notes," S&P
said.

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

Ratings Lowered and Removed From CreditWatch Negative

A          A (sf)                    AA+ (sf)/Watch Neg
B          BB (sf)                   A- (sf)/Watch Neg

Rating Affirmed

C          CCC (sf)


CASSIOPEIA QEX: S&P Affirms 'B-' Ratings on Two Classes of Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit rating on Cassiopeia QEX B.V.'s
class A notes. "At the same time, we affirmed our ratings on the
class B and C notes," S&P said.

The rating actions follow deteriorating performance within the
residential mortgage pool backing this transaction and a lack of
recoveries coming from defaulted loans.

"The collateral pool has been experiencing high default levels
since closing, in our view. According to the cash manager's report
on the April 2011 payment date, 6.3% of the assets in the
portfolio were in default and 39.1% were in foreclosure.
Cumulative defaults since closing reached 44.4% of the initial
balance of the securitized assets," S&P stated.

Since closing in July 2008, Banco Espanol de Credito (Banesto) --
the originator and servicer -- has received recoveries for only 71
properties.

"Taking the factors into consideration, we have lowered and
removed from CreditWatch negative our rating on Cassiopeia QEX
B.V.'s class A notes due to deteriorating credit performance," S&P
related.

Cassiopeia QEX has not paid interest on the class B notes since
the January 2009 interest payment date or on the class C notes
since October 2008 as certain performance-related triggers for the
postponement of the payment of interest on these notes have been
hit. "We have therefore affirmed our ratings on the class B and C
notes, taking into account that we rated these notes on an
ultimate payment of interest basis and we do not believe that the
notes will default in the near future. The notes' final legal
maturity is in April 2048," S&P stated.

Cassiopeia QEX issued the notes in July 2008. The underlying
portfolios include residential mortgage loans secured over
properties in Spain. Banesto originated and services the mortgage
loans. The credit risk manager--Finsolutia--is responsible for
supervising and monitoring the servicer's performance under the
servicing agreement, which includes the sale of properties at
auction in the foreclosure process. Citicorp Trustee Corp.
Ltd. is the fund's security and the note trustee.

Ratings List

Class                   Rating
               To                   From

Cassiopeia QEX B.V.
EUR448.6 Million Mortgage-Backed Floating-Rate Notes

Rating Lowered and Removed From CreditWatch Negative

A              BB- (sf)             BBB- (sf)/Watch Neg

Ratings Affirmed

B              B- (sf)
C              B- (sf)


GC SABADELL: S&P Lowers Rating on Class C Notes to 'CCC'
--------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit rating on GC Sabadell Empresas 2
Fondo de Titulizacion de Activos's class A2 notes. "We also
lowered our ratings on the class B and C notes and placed the
class B notes on CreditWatch negative," S&P stated.

"We had placed the class A2 notes on CreditWatch negative on Jan.
18, 2011, when our 2010 counterparty criteria became effective
('Counterparty And Supporting Obligations Methodology And
Assumptions,' published Dec. 6, 2010)," S&P related.

"The downgrade and removal from CreditWatch negative of the class
A2 notes follows the application of our 2010 counterparty criteria
and our latest credit and cash flow analysis. We understand that
none of the transaction documents have been updated to reflect our
2010 counterparty criteria," S&P stated.

"We have performed a review of the transaction's collateral
performance and structural features. We have taken today's rating
actions in light of what is, in our view, significant performance
deterioration of the underlying collateral backing this
transaction, and weakening of the credit enhancement available to
the rated notes," S&P noted.

"We have observed that the level of cumulative defaults is still
increasing due to the rollover of long-term delinquencies into
defaults. In our view, this likely indicates that there are
insufficient proceeds available to the issuer to cure such long-
term delinquencies," S&P said.

The transaction documents define defaulted assets in GC SABADELL
EMPRESAS 2 as assets that have been in arrears for more than 12
months. While the level of defaults has increased, the recoveries
associated with these defaulted assets are low, averaging 37%. "We
have consequently lowered our recovery assumptions, taking into
account the recovery data reported by the trustee, as well as the
level of recoveries we have observed in similar Spanish
transactions backed by the same type of loans, and with the same
asset vintages," S&P stated.

"Due to the seasoning of the transaction, and because the
underlying collateral is now amortized (the pool factor was 39% as
of the latest trustee reported data in June), we believe the
transaction is exposed to an increased level of concentration risk
in terms of obligors," S&P related.

As of the most recent reported data, the reported ratio of
cumulative defaults represented 3.37% of the original portfolio
balance securitized at closing, and 8.72% of the current portfolio
balance.

In terms of industry concentration, the biggest sectors currently
represented in this portfolio are the real estate and construction
industry (35.00%, combined), and the wholesale trade sector
(9.02%). In terms of geographic concentration, the three most
represented regions in this transaction are Catalonia, Madrid, and
Valencia, which is in line with the geographic breakdown of the
closing portfolio. "Of the current portfolio features, we
note that real estate leasing receivables now account for 75% of
the portfolio, compared with 50% at closing," S&P said.

"The increase in defaults is associated with a lack of recoveries
in the transaction. As a result, in our view, GC SABADELL EMPRESAS
2 is becoming highly sensitive to variations in the level of
performing collateral available to service the amounts due under
the notes, and this level is weakening. Although the level of
credit enhancement provided by the performing balance is still
positive for all the classes of notes, we consider it to be
relatively low," S&P said.

The reserve fund -- funded at closing by a subordinated loan -- is
intended to provide credit enhancement to the rated notes. It is
used to cure defaults in the transaction and is not currently at
its required level. The reserve fund began to be drawn in
September 2009, and since then it has been almost continually
depleted at each note payment date. "Currently, we understand that
the reserve fund is not at its required level, therefore lowering
the recourse of the class C notes against an increase in defaults
in the underlying pool," S&P said.

Credit enhancement for the notes is provided by:

    The subordination of junior notes;

    The level of excess spread generated by the performing balance
    of collateral;

    Excess spread received by the fund under the swap, which
    guarantees 25 basis points of excess spread to the
    transaction; and

    The reserve fund, which is used to cure defaults arising in
    the transaction.

The increase in defaults is associated with a decrease in the
reserve fund and the increase of the obligor concentration risk.
"In our view, these are negative factors for the transaction, as
they are not offset by the credit enhancement provided by the
subordination of junior classes," S&P said.

The transaction features a set of interest-deferral trigger tests
for the class B and C notes; the most senior outstanding class of
notes benefits from the diversion of the amounts of interest due
under the class B and C notes when a trigger has been breached.
Interest payments on the class B and C notes are deferred when, on
a payment date, the cumulative outstanding balance of defaulted
loans (with amounts in arrears greater than 12 months) represent
more than 5.92% and 3.62% of the outstanding balance of the pool
at closing. "The trigger for class C is very close to being
breached: As per our calculation, the level of cumulative defaults
represents 3.37% of the outstanding balance of the pool at
closing. As a consequence--and even if the fund currently has
sufficient proceeds available to service the interest due on the
class C notes on the next interest payment date (September 2011) -
- we believe it is likely that the class C interest payment will
not occur. As our ratings address timely payment of interest and
ultimate payment of principal, in this transaction such nonpayment
would be equivalent to a default. As a consequence, we have
lowered our rating on the class C notes to 'CCC (sf)'," S&P
related.

"Based on our review of our credit analysis assumptions in terms
of defaults and recoveries -- and taking into account the increase
in obligor concentration risk, the heightened exposure to the real
estate risk in the portfolio, and the current level of support
available to the rated notes in the capital structure -- in our
view this affects the current ratings on all the rated notes. We
have consequently lowered our ratings on the class A2, B, and C
notes. Also, due to rating action on the class A2 notes, this
class  is no longer on CreditWatch negative for counterparty
reasons, as the rating on the class A2 notes is no longer above
the rating that results from the long-term rating on Banco de
Sabadell S.A (acting as supporting party) plus one notch," S&P
noted.

"In addition, we have placed the rating on the class B notes on
CreditWatch negative, on the basis of the performance
deterioration of the securitized assets. We aim to resolve this
CreditWatch placement within 90 days," S&P said.

The collateral backing GC Sabadell Empresas 2 comprises a
portfolio of leasing receivables made to Spanish enterprises and
self-employed borrowers. These loans were originated by and are
serviced by Banco de Sabadell. The transaction closed in March
2008.

Ratings List

Class            Rating
       To                       From

GC SABADELL EMPRESAS 2, Fondo de Titulizacion de Activos
EUR1 Billion Floating-Rate Notes

Rating Lowered and Removed From CreditWatch Negative

A2     A (sf)                   AAA (sf)/Watch Neg

Rating Lowered and Placed On CreditWatch Negative

B      BBB- (sf)/Watch Neg      A (sf)

Rating Lowered

C      CCC (sf)                 BBB- (sf)


IM GROUP: S&P Affirms Rating on Class E Notes at 'D (sf) '
----------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on four Banco Popular transactions: IM Banco Popular
FTPYME 1, Fondo de Titulizacion de Activos; IM Grupo Banco Popular
Empresas 1, Fondo de Titulizacion de Activos; IM Grupo Banco
Popular FTPYME I, Fondo de Titulizacion de Activos; and IM Grupo
Banco Popular FTPYME II, Fondo de Titulizacion de Activos.

Specifically:

    "In IM Banco Popular FTPYME 1, we have affirmed and removed
    from CreditWatch negative our rating on the class A(G) notes
    and affirmed our ratings on the class B and C notes," S&P
    related.

    "In IM Grupo Banco Popular Empresas 1, we have lowered and
    removed from CreditWatch negative our rating on the class A2
    notes, and affirmed and removed from CreditWatch negative our
    rating on the class B notes. We have also affirmed our ratings
    on the class C, D, and E notes," S&P said.

    "In IM Grupo Banco Popular FTPYME I, we have affirmed and
    removed from CreditWatch negative our ratings on the class A3
    and A4 notes, and lowered and removed from CreditWatch
    negative our ratings on the class A5(G) and B notes. We have
    also lowered our ratings on the class C and D notes and
    affirmed our rating on the class E notes," S&P said.

    "In IM Grupo Banco Popular FTPYME II, we have affirmed and
    removed from CreditWatch negative our ratings on the class A2,
    A3(G), and B, notes, and affirmed our ratings on the class C,
    D, and E notes," S&P said.

"In our analysis, we applied our 2010 counterparty criteria, which
became effective on Jan. 18, 2011 (see 'Counterparty And
Supporting Obligations Methodology And Assumptions,' published on
Dec. 6, 2010). Following our review of the counterparty ratings
and the terms of the counterparty agreements for these four
transactions, we have either affirmed or lowered certain ratings,
in line with our criteria. We have also taken into account
developments regarding the credit quality of the assets backing
these transactions and the structural features for each
transaction. These include the significant seasoning of the
underlying portfolios, the trends in delinquency rates and
the cumulative default rates, the lack of recoveries that these
transactions are experiencing, and the obligor and sector
concentration affecting each transaction," S&P said.

                    IM Banco Popular FTPYME 1

In IM Banco Popular FTPYME 1, which closed in December 2004, loans
are now mainly secured by mortgages: 94.43% of the pool are now
secured loans, versus 80.00% at closing.

The portfolio shows increasing obligor concentration: The top
obligor accounts for 1.40% of the current portfolio, the top 10
account for 8.21%, and the top 25 account for 15.76%. This
compares with 0.47%, 3.08%, and 6.45% at closing, respectively.
The underlying portfolio is highly seasoned and has a low pool
factor of 13.13%, compared with the portfolio balance at closing.
In particular, as of the most up-to-date information on the April
26, 2011 payment date:

    Class A(G) is now the most senior outstanding class, since the
    amortization of class A in August 2009.

    Reported delinquencies of more than 90 days were 2.50%, and
    defaults were 6.74% of the outstanding portfolio balance. In
    addition, the reserve fund was at 24.91% of its required
    level.

    The level of cumulative defaults was 1.78% of the original
    balance, which is close to our initial expectations of about
    2.40% (derived from historical originator data). "We
    subsequently updated the default assumptions we use in
    our analysis, to take into account the higher levels
    reported," S&P said.

    "The transaction is experiencing recoveries on defaulted loans
    at lower levels than our initial expectations. We have
    therefore adjusted our recovery assumptions accordingly," S&P
    said.

    "Nevertheless, the increase in the credit enhancement levels
    since closing (to 29.92%, 17.32%, and 1.05%, from 7.15%,
    4.15%, and 0.85% at closing for the class A(G), B, and C
    notes) mitigates the adjustments we have made in our
    assumptions, and as a result we have affirmed the ratings on
    the class B and C notes," S&P said.

    "Applying our 2010 counterparty criteria and taking into
    account that no amendments have been made to the transaction
    documents to reflect those criteria, we consider that the
    class A(G) notes should remain at their current rating, and we
    have therefore affirmed and removed from CreditWatch negative
    the 'AAA (sf)' rating on this class of notes," S&P noted.

              IM Grupo Banco Popular EMPRESAS 1

In IM Grupo Banco Popular 1, which closed in September 2006, the
loans backing the transaction are now mainly secured by mortgages:
96.51% of the pool are now secured loans, versus 84.02% at
closing.

The portfolio shows increasing obligor concentration: The top
obligor accounts for 2.33% of the current portfolio, the top 10
account for 13.89%, and the top 25 account for 21.51%. This
compares with 0.90%, 6.93%, and 13.30% at closing. The underlying
portfolio is highly seasoned and has a low pool factor of 21.42%,
compared with the portfolio balance at closing. In particular, as
of the most up-to-date information on the June 21, 2011 payment
date:

    Class A2 is now the most senior outstanding class, since the
    amortization of class A in July 2008.

    Reported delinquencies of more than 90 days were 1.86%, and
    defaults were 9.36% of the outstanding portfolio balance. In
    addition, the reserve fund was at 80.33% of its required
    level.

    "The level of cumulative defaults was 3.26% of the original
    balance, which is within our revised expectations at our last
    rating action in June 2009, of about 7.44% (derived from the
    historical performance of this transaction and the
    concentrations that had arisen)," S&P related.

    "The transaction is experiencing recoveries on defaulted loans
    that are also in line with our revised expectations from June
    2009," S&P noted.

    "We have affirmed our ratings on the class C and D notes," S&P
    said.

    "In July 2009, we lowered our rating to 'D (sf)' on the class
    E notes, following an interest payment failure by the fund on
    the class E notes. We have affirmed the 'D (sf)' rating on the
    class E notes. We rated this class 'CCC- (sf)' at closing, and
    the note proceeds funded the reserve feature to provide credit
    enhancement to the structure and to cure defaults in the
    transaction," S&P related.

    "Applying our 2010 counterparty criteria and taking into
    account that no amendments have been made to the transaction
    documents to reflect those criteria, we consider that the
    class A2 notes can no longer maintain their current rating,
    and we have therefore lowered to 'AA (sf)' and removed from
    CreditWatch negative our rating on this class of notes. We
    consider that the class B notes should remain at their current
    rating, and we have therefore affirmed and removed from
    CreditWatch negative the 'AA- (sf)' rating on this class of
    notes," S&P said.

                  IM Grupo Banco Popular FTPYME I

In IM Grupo Banco Popular FTPYME I, which closed in December 2006,
the loans backing the transaction are now mainly secured by
mortgages: 97.13% of the pool are now secured loans, versus 85.58%
at closing.

The portfolio shows stable obligor concentration: The top obligor
accounts for 0.93% of the current portfolio, the top 10 account
for 6.35%, and the top 25 account for 11.48% of the outstanding
portfolio. This compares with 0.75%, 5.73%, and 10.26% at closing.
The underlying portfolio is highly seasoned and has a low pool
factor of 26.54%, compared with the portfolio balance at closing,
and this current figure is in line with the previous transactions
that closed two months before IM Grupo Banco Popular FTPYME I.
In particular, as of the most up-to-date information on the June
21, 2011 payment date:

    Class A3 is now the most senior outstanding class, since the
    amortization of classes A1 and A2 in October 2008.

    Reported delinquencies of more than 90 days were 1.52%, and
    defaults were 6.78% of the outstanding portfolio balance. In
    addition, the reserve fund was at 98.17% of its required
    level, after several replenishments on recent payment dates.

    "The level of cumulative defaults was 3.70% of the original
    balance, which is above our initial expectations of about
    2.33% (derived from historical originator data). We
    subsequently updated the default assumptions we use in our
    analysis, to take into account the higher levels reported,"
    S&P related.

    "The transaction is experiencing recoveries on defaulted loans
    at lower levels than our initial expectations. We have
    therefore adjusted our recovery assumptions accordingly," S&P
    said.

    "We have run our cash flows, and although credit enhancement
    levels have increased since closing, in our view they do not
    mitigate the relatively poor performance of this transaction,
    and therefore we have lowered our ratings on the class C and D
    notes," S&P said.

    "In July 2009, we lowered our rating to 'D (sf)' on the class
    E notes, following an interest payment failure by the fund on
    the class E notes. We have today affirmed the 'D (sf)' rating
    on the class E notes. We rated this class 'CCC- (sf)' at
    closing, and the note proceeds funded the reserve feature to
    provide credit enhancement to the structure and to cure
    defaults in the deal," S&P related.

    "Applying our 2010 counterparty criteria and taking into
    account that no amendments have been made to the transaction
    documents to reflect those criteria, we consider that the
    class A3 and A4 notes should remain at their current ratings,
    and we have therefore affirmed and removed from CreditWatch
    negative the 'AAA (sf)' ratings on these classes of notes. We
    consider that the class A5(G) and B notes cannot maintain
    their current ratings, and we have therefore removed from
    CreditWatch negative and lowered our ratings on these notes to
    'AA+ (sf)' and 'AA- (sf)'," S&P said.

                 IM Grupo Banco Popular FTPYME II

In IM Grupo Banco Popular FTPYME II, which closed in July 2007,
loans backing the transaction are now mainly secured by mortgages:
70.77% of the pool are now secured loans, versus 50.76% at
closing.

The portfolio shows increasing obligor concentration: The top
obligor accounts for 2.78% of the current portfolio, the top 10
account for 15.45%, and the top 25 account for 26.78%. This
compares with 1.00%, 7.24%, and 14.13% at closing. The underlying
portfolio is highly seasoned and has a low pool factor of 20.29%,
compared with the portfolio balance at closing. In particular, as
of the most up-to-date information on the April 26, 2011 payment
date:

    Class A2 is now the most senior outstanding class, since the
    amortization of class A1 in October 2010.

    Reported delinquencies of more than 90 days were 0.54% and
    defaults were 8.09% of the outstanding portfolio balance. In
    addition, the reserve fund was at 72.61% of its required
    level.

    "The level of cumulative defaults was 2.43% of the original
    balance, which is within our revised expectations at our last
    rating action in December 2008 of about 4.60% (derived from
    the historical transaction performance and the concentrations
    that had arisen)," S&P stated.

    "The transaction is experiencing recoveries on defaulted loans
    at lower levels than our initial expectations. We have
    therefore adjusted our recovery assumptions accordingly," S&P
    stated.

    "We have affirmed our ratings on the class B, C, and D notes,
    and have removed the class B notes from CreditWatch negative,"
    S&P noted.

    "In July 2009, we lowered our rating to 'D (sf)' on the class
    E notes, following an interest payment failure by the fund on
    the class E notes. We have affirmed the 'D (sf)' rating on the
    class E notes. We rated this class 'CCC- (sf)' at closing, and
    the note proceeds funded the reserve feature to provide credit
    enhancement to the structure and to cure defaults in the
    deal," S&P related.

    "Applying our 2010 counterparty criteria and taking into
    account that no amendments have been made to the transaction
    documents to reflect those criteria, we consider that the
    class A2 and A3 notes should remain at their current ratings,
    and we have therefore affirmed and removed from CreditWatch
    negative the 'AAA (sf)' ratings on these classes of notes,"
    S&P said.

The portfolios backing these four transactions comprise secured
and unsecured loans granted to small and midsize enterprises
(SMEs) in their normal course of business, distributed through all
Spanish regions. Except for IM Banco Popular FTPYME 1, where the
originator is Banco Popular only, the other three transactions
were originated by Banco de Andalucia S.A., Banco de Castilla
S.A., Banco de Credito Balear S.A., Banco de Galicia S.A., Banco
de Vasconia S.A., and Banco Popular Espanol S.A. (together, "Grupo
Banco Popular"). Grupo Banco Popular is one of Spain's largest
financial institutions.

Classes with a '(G)' in their name benefit from a guarantee
provided by the Kingdom of Spain (AA/Negative/A-1+). "However, we
have not taken this into account in our analysis, as we do not
consider the guarantee to be in line with our guarantee criteria
(see 'European Legal Criteria For Structured Finance
Transactions,' published on Aug. 28, 2008)," S&P said.

"On Feb. 22, 2011, we downgraded Banco Popular to A-/Negative/A-2
(see 'Negative Rating Actions Taken On Four Spanish Banks In The
Context Of A Difficult 2011'), and the bank therefore had to take
remedial actions. As of July 2011, the treasury account amounts in
the four transactions are guaranteed by Banque Federative du
Credit Mutuel (A+/Stable/A-1), and the swaps have been
collateralized--except for IM Grupo Banco Popular FTPYME I, as the
swap counterparty is HSBC Bank PLC (AA/Stable/A-1+), which is
eligible according to the transaction documents," S&P added.

Ratings List

Class              Rating
           To                   From

IM Banco Popular FTPYME 1, Fondo de Titulizacion de Activos
EUR2 Billion Floating-Rate Notes

Rating Affirmed and Removed From CreditWatch Negative

A(G)       AAA (sf)             AAA (sf)/Watch Neg

Ratings Affirmed

B          A (sf)
C          B- (sf)

IM Grupo Banco Popular Empresas 1, Fondo de Titulizacion de
Activos
EUR1.832 Billion Floating-Rate Notes

Rating Lowered and Removed From CreditWatch Negative

A2         AA (sf)              AAA (sf)/Watch Neg

Rating Affirmed and Removed From CreditWatch Negative

B          AA- (sf)             AA- (sf)/Watch Neg

Ratings Affirmed

C          A (sf)
D          BB (sf)
E          D (sf)

IM Grupo Banco Popular FTPYME I, Fondo de Titulizacion de Activos
EUR2.03 Billion Floating-Rate Notes

Ratings Affirmed And Removed From CreditWatch Negative

A3         AAA (sf)             AAA (sf)/Watch Neg
A4         AAA (sf)             AAA (sf)/Watch Neg

Ratings Lowered and Removed From CreditWatch Negative

A5(G)      AA+ (sf)             AAA (sf)/Watch Neg
B          AA- (sf)             AA (sf)/Watch Neg

Ratings Lowered

C          BBB (sf)             BBB+ (sf)
D          B+ (sf)              BB (sf)

Rating Affirmed

E          D (sf)

IM Grupo Banco Popular FTPYME II, Fondo de Titulizacion de Activos
EUR2.039 Billion Floating-Rate Notes

Ratings Affirmed and Removed From CreditWatch Negative

A2         AAA (sf)             AAA (sf)/Watch Neg
A3(G)      AAA (sf)             AAA (sf)/Watch Neg
B          A+ (sf)              A+ (sf)/Watch Neg

Ratings Affirmed

C          BBB+ (sf)
D          B (sf)
E          D (sf)


IM TERRASSA: Fitch Downgrades Rating on Class C Notes to 'BBsf'
---------------------------------------------------------------
Fitch Ratings has affirmed two tranches and downgraded one tranche
of IM Terrassa MBS 1, a Spanish RMBS transaction. The class A
notes have been placed on Rating Watch Negative (RWN). The rating
actions are:

   -- Class A (ISIN ES0347855001) 'AAAsf'; placed on Rating Watch
      Negative; Loss Severity Rating 'LS-1'

   -- Class B (ISIN ES0347855019) affirmed at 'Asf'; Outlook
      revised to Negative from Stable; 'LS-2'

   -- Class C (ISIN ES0347855027) downgraded to 'BBsf' from
      'BBB+sf'; Outlook Negative; 'LS-3'

In light of Caixa d'Estalvis Unio de Caixes Manlleu, Sabadell i
Terrassa's (UNIM; the originator and servicer) current rating
('BB+'/Stable/'F2'), the agency has assessed the exposure of the
transaction to commingling and payment interruption risk, should
the servicer "jump-to-default". As the reserve fund is currently
being utilized to provision for defaulted loans, which is expected
to remain the case on the upcoming payment dates, in the absence
of any other structural features that could mitigate the temporary
loss of liquidity following the default of UNIM, Fitch has placed
the class A notes on RWN. The agency has been informed that the
gestora, InterMoney SGFT, is looking to put appropriate mitigants
in place. The agency will look to resolve the RWN once it receives
final confirmation from the gestora that these mitigants have been
implemented. If no mitigants are put in place, a multi-category
rating action is likely.

The transaction continues to perform poorly compared with other
Fitch-rated Spanish RMBS transactions. This is evidenced by the
amount of loans in arrears by more than three months as a
percentage of the current portfolio and the gross cumulative
defaults (defined as loans in arrears by more than 12 months) as a
percentage of the initial collateral balance (2.1% and 3.5%
respectively as of May 2011). As a result of the weak performance,
the gross excess spread levels generated by the transaction have
been insufficient to cover period provisions. This has led to
continued reserve fund draws and lower than expected credit
enhancement levels, particularly on the class C notes. As of May
2011, the reserve fund stood at 66% of its target amount. In
October 2009 the reserve fund was nearly depleted, only to be
fully replenished two interest payment dates (IPD) later. The
replenishment at the time was possible due to the high volume of
recoveries that had reached the issuer. Fitch believes that the
recoveries were related to a potential repurchase of loans out of
the portfolio by the originator. With the weak credit rating of
the originator UNIM, Fitch believes that such support is not
sustainable in the future.

The downgrade of the class C tranche is a direct consequence of
the performance seen to date. As of the April 2011 IPD, the
interest on the class C notes has fallen in the priority of
payments to item (vii) from (v), which puts it behind the
principal amortization of class A notes. Fitch also has concerns
about the size of current pipeline of potential defaults. Given
that the three-month plus arrears bucket is currently 2.1% of the
current portfolio, the agency believes further reserve fund draws
will occur in the upcoming IPDs. This is expected to lead to a
further decline in the credit enhancement levels available to the
rated notes. The underlying loans in the pool also remain
susceptible to a rise in interest rates which could lead to a
further increase in arrears levels, and potentially more reserve
fund draws in the future. As a result, Fitch has revised the
Outlook on the class B notes to Negative from Stable, reflecting
the agency's concerns over the future performance of this
transaction and the ability of the notes to withstand a higher
interest rate environment.

The class A notes continue to benefit from structural
characteristics such as the sequential amortization currently in
force. While Fitch deems the current credit enhancement level of
this tranche as appropriate for its current rating, the agency is
concerned about the payment interruption risk and has consequently
placed this class on RWN until confirmation is received with
regards to any potential mitigants.


=====================
S W I T Z E R L A N D
=====================


SWISS RE: S&P Assigns 'BB+' Rating to Series VI Class E Notes
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned preliminary ratings to
the US$100 million principal-at-risk variable-rate mortality
catastrophe-indexed series V class D notes and series VI class E
notes to be issued by Vita Capital IV Ltd.

The notes will provide Swiss Reinsurance Company Ltd. (Swiss Re;
A+/Positive/A-1) with a degree of protection against extreme
mortality events occurring to specified age and gender
distributions in the U.S., Canada, Germany, and the U.K.

Swiss Re has previously securitized mortality risk through the
Vita Capital Ltd., Vita Capital II Ltd., Vita Capital III Ltd.,
and earlier takedowns of the Vita Capital IV Ltd. transaction.

Vita Capital IV was created for the sole purpose of issuing one or
more series of notes out of a mortality catastrophe shelf program.
Standard & Poor's has not assigned ratings to the shelf program.

The series V noteholders will be at risk from an increase in age
and gender-weighted mortality rates that exceeds a specified
percentage of a predefined index (the mortality index value; MIV)
in Canada and Germany. The series VI noteholders will be at risk
from an increase in age and gender-weighted mortality rates that
exceeds a specified percentage of the MIV in Canada, Germany, the
U.K. and the U.S. The risk period for both series runs from Jan.
1, 2011, to Dec. 31, 2015.

The MIV will be defined on a rolling two-year period, and the
probability of a loss attaching and the magnitude of the loss in
principal will depend on the extent to which the MIV for any
country and measurement period (that is, two consecutive years)
exceeds the attachment point for the notes. Index values
corresponding to future measurement periods will be measured
against the index value for 2010 for all four covered countries.
Adjustments will be applied for changes in mortality over the risk
period.

At closing, Swiss Re will enter into a contract with the issuer
using standard International Swaps and Derivatives Association
(ISDA) wording. Under this contract, Swiss Re will make payments
to the issuer in exchange for extreme mortality protection. The
issuance proceeds are to be invested in collateral in the form of
'AAA' rated notes issued by the International Bank for
Reconstruction and Development. The coupon on the notes will be
paid from the payments made by Swiss Re under the ISDA contract
and from investment earnings on the collateral held in trust.

The ratings reflect:

    Standard & Poor's qualitative assessments of the potential
    event risk;

    "Our view of the modeled probability of default," S&P said;

    The diversification of the underlying mortality risk exposure
    in terms of geographic location, age, and gender; and

    The application of Standard & Poor's catastrophe bond
    criteria.

Ratings List
Series/Class          Prelim.            Prelim.
                      rating             amount (mil. US$)
Series V class D      BBB- (sf)          50
Series VI class E     BB+ (sf)           50


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


NADRA BANK: Expects to Exit Receivership by August 12
-----------------------------------------------------
Dragon Capital reports that Nadra Bank, controlled by local
businessman Dmytro Firtash, said it would be out of receivership
by August 12, making all its customer deposits (UAH4.9 billion as
of end-1H11) immediately accessible.

The bank has been managed by an external administrator since
February 2009, Dragon Capital discloses.

Headquartered in Kiev, Ukraine, Bank Nadra reported total assets
of UAH24.8 billion (US$3.1 billion) and total equity of UAH475
million (US$59.3 million) according to Ukrainian Accounting
Standards at year-end 2009.


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


BLACKS LEISURE: Turns to Bank Following Decline in Sales
--------------------------------------------------------
This is Money reports that Blacks Leisure Group revealed it had
turned to its bank for more support after falling sales increased
its debt pile.

According to the report, the group has negotiated a new
GBP4 million banking facility from Bank of Scotland, effectively
giving it an extra GBP2 million until December 15.

The move follows a "significant increase" in its debt after a
worse than expected 9.7% drop in like-for-like sales in the 19
weeks to July 9 caused by 'challenging market conditions' amid the
squeeze in consumer spending, This is Money relates.

The report notes that Chief executive Neil Gillis said the bank
facility was needed to provide 'sufficient headroom.

                       About Blacks Leisure

Headquartered in Northampton, Blacks Leisure Group plc --
http://www.blacksleisure.co.uk/-- is the parent company of its
subsidiaries, which are engaged in the retail and wholesale of
clothing and camping equipment.  The Company comprises two
segments: Outdoor and Boardwear.  Outdoor trades under the fascias
Blacks and Millets.  The trade is from retail stores in the
British  Isles, and the associated direct sale Internet sites.
Boardwear holds the United Kingdom licenses for O'Neill and Mambo
products to trade as a wholesale operation and from retail stores.
The stores retail brands are Peter Storm and Eurohike.  Other
brands sold include Berghaus, North Face, Merrell, Coleman,
Karrimor, Hi-Tec, Columbia and Craghoppers.  The Company's
subsidiaries include Blacks Outdoor Division Ltd, The Outdoor
Group Ltd and Sandcity Ltd.


CARNUNTUM HIGH: S&P Affirms Rating on Class E Notes at 'BB'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
Carnuntum High Grade I Ltd.'s class A-1, A-2, A-3, B, C, and combo
notes. "We have kept on CreditWatch negative our ratings on the
class A-1, A-2, A-3, B, and combo notes. At the same time, we
affirmed our ratings on the class D and E notes," S&P said.

"The rating actions follow our performance review of the
transaction, applying our 2010 counterparty criteria (see
'Counterparty And Supporting Obligations Methodology And
Assumptions,' published on Dec. 6, 2010) and our updated corporate
cash flow and synthetic CDOs criteria (see 'Update To Global
Methodologies And Assumptions For Corporate Cash Flow And
Synthetic CDOs,' published on Sept. 17, 2009)," S&P said.

               Application of Counterparty Criteria

"On Jan. 18, 2011, we placed on CreditWatch negative our ratings
on the class A-1, A-2, A-3, B, C, and combo notes when our 2010
counterparty criteria became effective (see 'EMEA Structured
Finance CreditWatch Actions In Connection With Revised
Counterparty Criteria')," S&P said.

"We have since applied our counterparty criteria and in our review
of the counterparty related transaction documents we found that
some or all agreements do not fully comply with our updated
criteria. However, the ratings are supported by the minimum issuer
credit rating (ICR) plus one notch of the lowest rated
counterparty (WestLB AG; BBB+/Negative/A-2) in this transaction
according to our criteria. As we have rated the class A-1, A-2, A-
3, B, and combo notes higher than 'A- (sf)'--at 'A (sf)' or above-
-we have kept on CreditWatch negative our ratings on these classes
of notes and we have removed from CreditWatch negative our 'A-
(sf)' rating on the class C notes," S&P related.

"We understand that the swaps are in the process of being novated
to Erste Abwicklungsanstalt (AA-/Stable/A-1+). We aim to resolve
the CreditWatch negative placement on the class A-1, A-2, A-3, and
B notes when the novation becomes effective," S&P added.

                        Credit Analysis

"Since our review in June 2009, we have observed negative rating
migration of the performing assets. Also, 14% of the assets are
currently on CreditWatch negative for counterparty reasons. We
therefore assumed a three-notch downgrade on the assets in our
analysis, in line with our methodology," S&P said.

"While the overall credit quality of the portfolio has declined,
we note that the transaction has accumulated about EUR40 million
of principal, slightly increasing the credit enhancement available
to each tranche," S&P related.

"However, in our opinion, the credit enhancement available to the
class A-1, A-2, B, C, and combo notes is not sufficient to
maintain their prior ratings. The decline in credit quality and
the application of our updated corporate cash flow criteria to
assets with a corporate exposure (CLOs and synthetic CDOs account
for 26% of the current portfolio) has led us to lower our ratings
on these classes of notes," S&P stated.

"In addition to counterparty reasons, our rating on the combo
notes remains on CreditWatch negative pending further cash flow
analysis and clarification on the expected distributions for these
notes," S&P said.

"Despite improving credit enhancement, we consider that the
ratings on the class D and E notes reflect their juniority in the
capital structure, their relatively small tranche size, and
sensitivity to recovery rates and correlation assumptions made in
our analysis. We have therefore affirmed our ratings on these
classes of notes," S&P said.

Carnuntum High Grade I is a cash collateralized debt obligation
(CDO) of structured finance assets -- involving largely commercial
mortgage-backed securities, residential mortgage-backed
securities, and CDOs -- managed by Omicron Investment Management
GmbH. The transaction closed in February 2007 and will enter its
post-reinvestment period in June 2012.

Ratings List

Class                   Rating
            To                        From

Carnuntum High Grade I Ltd.
EUR1.03 Billion Floating-Rate Notes

Ratings Lowered and Remaining on CreditWatch Negative

A-1         AA (sf)/Watch Neg         AAA (sf)/Watch Neg
A-2         AA (sf)/Watch Neg         AAA (sf)/Watch Neg
A-3         A+ (sf)/Watch Neg         AAA (sf)/Watch Neg
B           A (sf)/Watch Neg          AA (sf)/Watch Neg
Combo       A- (sf)/Watch Neg         A (sf)/Watch Neg

Rating Lowered and Removed From CreditWatch Negative

C           A- (sf)                   A (sf)/Watch Neg

Ratings Affirmed

D           BBB (sf)
E           BB (sf)


INEOS FINANCE: Moody's Upgrades CFR to 'B2'; Outlook Positive
-------------------------------------------------------------
Moody's Investors Service has undertaken a series of rating
actions related to Ineos Group Holdings S.A. and its various debt
instruments in conjunction with upgrading the corporate family
rating (CFR) by one notch to B2 and assigning a positive outlook:

  (i) The ratings on the first lien senior secured bank facilities
      and 2015 notes were upgraded by one notch to Ba3/LGD 3 (31),

(ii) The ratings on 2015 second lien senior secured loans were
      upgraded by one notch to B3 / LGD 5 (73), and

(iii) The ratings on 2016 senior guaranteed notes were upgraded by
      one notch to Caa1 / LGD 5 (88).

RATINGS RATIONALE

The rating action follows the announcement of the successful
closing of the refining joint venture transaction by Ineos with
Petrochina (unrated). The negotiated terms of the transaction
allow the company to retain full benefits of its integrated
business model, as its downstream petrochemical production
facilities remain integrated in the refining facilities of the
joint venture. We also expect that the carving out of the more
volatile refining operations will reduce the operating risk
profile of the rated group and further mitigate financial risks
previously associated with managing significant working capital
requirements of the refining business within the leveraged capital
structure.

The significant USD 1.015 b cash proceeds from the transaction
will also allow Ineos to accelerate the deleveraging. Taking into
account the expected reduction in debt from the proceeds of the
transaction and the strong cash flow generation by the company in
2011, we expect the leverage to reduce towards 4.5x times on the
fully adjusted basis. Strong operating performance in 1H 2011 and
the likely supportive supply/demand fundamentals for the main co-
monomers should continue to support to the deleveraging efforts.

We see limited potential for the incremental improvement in the
operating performance in the near term, given the current high
level of pricing and high utilization rates enjoyed by Ineos. The
positive outlook on the ratings reflects our expectation that the
management will continue to execute on the program of deleveraging
and that the company will also be able to create additional
flexibility within the capital structure, leading, over time, to a
reduction in the interest burden. Further upward pressure would
develop if leverage falls below 4.5x times on a sustainable basis.
An upgrade of the rating would also require Ineos to maintain a
very strong liquidity profile and proactively manage its
maturities. A deterioration in operating performance leading to a
sustained weakness in cash flow generation and weaker debt
coverage metrics and/or a sustained negative FCF generation would
put a negative pressure on the ratings.

***

These ratings were affected by the rating action:

Ineos Group Holdings S.A.:

- Corporate Family Rating: B2 / PD - B2;

- 2016 senior g-teed notes - Caa1 / LGD 5 (88);

Ineos Holding Limited:

- First-lien senior g-teed bank facilities and notes - Ba3 / LGD 3
  (31);

- Second lien senior loans -- B3 / LGD 5 (73).

The principal methodology used in rating Ineos Group Holdings S.A.
was the Global Chemical Industry Methodology published in December
2009.Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009.


KINETICS GROUP: In Administration for Second Time in a Month
------------------------------------------------------------
H&V News reports the Kinetics Group has entered administration for
the second time in a month with 550 job losses expected.

Partners at Begbies Traynor, Gary Lee, Dean Watson and Neil
Mather, were appointed joint administrators of the group, which
includes SCP Renewable Energy Limited, Sureway Gas Ltd, Kinetics
Midlands Ltd and Kinetics South Ltd, according to H&V News.

The Kinetics Group originally went into administration on June 9.

H&V News says the first administration led to 270 job losses in
the North West, but shares in Sureway Gas, Kinetics Midlands and
Kinetics South were acquired by SCP Renewable Energy Ltd.  The
Kinetics brand was maintained and a reported 640 jobs saved, the
report relates.

The administrators then said that since the reorganization, the
group has suffered from confusion regarding the solvency of
subsidiary companies, delays in payments from key customers and
from suppliers' refusal to continue trading with it after its
credit insurance cover was removed, H&V News notes.

H&V News says that the vast majority of the 550 staff, who work
across five sites, have been made redundant, with a small skeleton
staff kept on to finalize the affairs of the group companies.

"It is with regret that the group has failed so soon after the
restructuring exercise was carried out.  A range of factors have
impacted upon the group's cash position and uncertainty over the
financial position of the group has meant many of its contracts
with customers have been placed elsewhere, curtailing the group's
ability to trade on," H&V News quoted Mr. Lee as saying.

Kinetics Group is a social housing contractor.


LLOYDS BANKING: In Exclusive Talks to Sell Distressed Loan Package
------------------------------------------------------------------
Marietta Cauchi at Dow Jones Newswires reports that an unnamed
source said Lloyds Banking Group PLC is in exclusive talks to sell
a package of distressed commercial real-estate loans, as it steps
up its asset-disposal program under Chief Executive Officer
Antonio Horta-Osorio.

The portfolio, code-named Flagstaff, comprises some 35 assets
including office, retail, leisure and industrial space, all of
which were in receivership, according to Dow Jones' Newswire.

Dow Jones Newswires notes that Lloyds Banking declined to identify
the bidder but earlier reports said that Telereal Trillium, a
property investment company controlled by the Pears family, will
pay GBP47 million for the portfolio of assets that are all in
receivership.  The sale is expected to reflect an initial yield of
around 11%

Jones Lang LaSalle was hired in May to handle the sale, which
attracted several bidders, Dow Jones Newswires discloses.

Dow Jones Newswires recalls that Lloyds sold GBP4 billion of
commercial real-estate assets in 2010 out of a total GBP78.26
billion in outstanding loans to property companies.  The bundle
sold came out of the bank's Business Support Unit, which holds
assets that are underperforming, either financially or
operationally, and need to be improved but aren't necessarily
earmarked for sale as non-core, Dow Jones Newswires says.

The bank is also in the process of selling its retail network of
600 branches across the U.K, Dow Jones Newswires adds.  It hopes
to complete that transaction by the end of the year.

                 About Lloyds Banking Group PLC

Lloyds Banking Group plc -- http://www.lloydsbankinggroup.com/--
is a financial services group providing a range of banking and
financial services, primarily in the United Kingdom, to personal
and corporate customers.  The Company operates in four segments:
Retail, Wholesale, Wealth and International, and Insurance. Its
main business activities are retail, commercial and corporate
banking, general insurance, and life, pensions and investment
provision.  It also operates an international banking business
with a global footprint in over 30 countries.  Services are
offered through a number of brand, including Lloyds TSB, Halifax,
Bank of Scotland, Scottish Widows, Clerical Medical and Cheltenham
& Gloucester, and a range of distribution channels.  In March
2010, Capita Group Plc acquired Ramesys (Holdings) Ltd from Lloyds
Banking Group plc's Lloyds Bank.  In April 2011, Lloyds Banking
Group plc's LDC bought gas and chemicals business, A-Gas, and a
stake in UK2 Group, a Web hosting company.


NEMUS II ARDEN: Fitch Affirms Rating on Class F Notes at 'CCsf'
---------------------------------------------------------------
Fitch Ratings has affirmed Nemus II (Arden) Plc's floating rate
notes:

   -- GBP192.3m Class A (XS0278300487) affirmed at 'AA+sf';
      Outlook revised to Stable from Negative

   -- GBP15.6m Class B (XS0278300560) affirmed at 'AA-sf'; Outlook
      revised to Stable from Negative

   -- GBP10.5m Class C (XS0278300727) affirmed at 'Asf'; Outlook
      revised to Stable from Negative

   -- GBP9.5m Class D (XS0278300295) affirmed at 'BBBsf'; Outlook
      revised to Stable from Negative

   -- GBP16.2m Class E (XS0278301378) affirmed at 'CCCsf';
      Recovery Rating RR5

   -- GBP1.1m Class F (XS0278301535) affirmed at 'CCsf'; RR6

The affirmations reflect the stabilization in performance and
property market conditions since the last rating action in
May 2010. Of the six loans originally securitized in Nemus II
(Arden) plc, five remain. The GBP23 million Somerfield and GBP11.9
million Carlton House loans are currently in special servicing,
whereas the GBP127.8 million Victoria (Kirkglade Limited) and
GBP42.4 million Buchanan House (Fern Trustee 1 Ltd and Fern
Trustee 2 Ltd) loans are watchlisted (due to covenant breaches)
but remain in primary servicing. The fifth loan, GBP40 million
Kinnaird House (Chainmill Properties Limited), continues to show a
stable performance.

The Somerfield loan defaulted in January 2009 when the borrower
failed to cure a breach of the loan-to-value (LTV) covenant. The
cashflow remains stable as the underlying properties are fully-let
to Somerfield Stores Limited on a remaining lease term of 25
years. The special servicer is reportedly in negotiations with the
borrower seeking an exit strategy for the loan in time for loan
maturity in October 2011.

The Carlton House loan defaulted in December 2008 due to non-
payment of taxes by the borrower's parent company. Principal
payments have been suspended until January 2012 to ensure the
borrower has sufficient cash flow to meet its operating expenses.
The reported A-note/whole loan LTV is 89%/96%, although Fitch
estimates the A-note is in excess of 100%, which explains the
'CCsf' rating assigned to the Class F note.

Surplus rental income continues to be trapped with respect to the
Buchanan House and Victoria loans as both loans remain in breach
of their respective LTV covenants. No enforcement action has been
taken so far because scheduled interest and principal continues to
be paid. Both loans mature in October 2013, more than six years
prior to final legal bond maturity. The reported A-note/whole loan
LTV is 77%/89% for Victoria and 87%/98% for Buchanan House,
although Fitch estimates that both A-notes are in excess of 90%
and both whole loans of 100%.


SAMURAI SUSHI: Chozen Venues Buys Four Sites From Administration
----------------------------------------------------------------
Lorraine Heller at Big Hospitality reports that restaurant
operator Chozen Venues has purchased four Samurai Sushi sites,
Shaftesbury Avenue, Baker Street, Holborn and London Wall, after
the Japanese takeaway operator fell into administration last week.

The company, led by former Mongolian Barbeque MD John Dodds, is
running the four sites under license from the administrators until
the leases are formally transferred, according to Big Hospitality.
The report relates that property advisors Selsian, who advised
Chozen Venues on the deal, said the company will likely keep the
Samurai Sushi brand and look to roll out the concept to other
locations in the capital.

Big Hospitality says that the spiraling costs relating to Samurai
Sushi's central kitchen and head office were the cause of its
collapse, with the majority of the sites believed to have been
trading well.

The central kitchen and the group's remaining site in New Row are
believed to be still in the hands of the administrators, Big
Hospitality adds.

Samurai Sushi operates Japanese restaurants in the United Kingdom.


SHERWOOD CASTLE: S&P Affirms 'BB' Ratings on Two Classes of Notes
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its credit ratings on
all classes of notes in the Sherwood Castle Trust's outstanding
series: Sherwood Castle Funding Series 2004-1 PLC, Sherwood Castle
Funding Series 2004-2 PLC, Sherwood Castle Funding Series 2005-1
PLC, and Sherwood Castle Funding Series 2006-1 PLC.

The Sherwood Castle Trust is a credit card master trust operated
by Capital One Bank Europe PLC. Capital One originated the credit
card receivables in the U.K. "As part of our review, we examined
the delinquency, charge-off, yield, and payment rate metrics of
the transaction. The affirmations reflect the sustained
performance in all four of these metrics for all four series," S&P
said.

The performance of the Sherwood Castle Trust is:

    Delinquencies are trending downward, notably in the 90+ day
    delinquency bucket that peaked at 4.35% in June 2009, and are
    3.46% as of the last reporting date in May 2011.

    Charge-offs have reduced to 10.49% as of May 2011, from 13.99%
    in September 2009. "Given the continued reduction in long-term
    delinquencies, we expect charge-off figures to further
    reduce," S&P said.

    Yield has increased to 26.49% as of May 2011, from a low of
    19.73% in April 2009. "We have revised our yield base case
    upward to 21.5%, from 19.0%," S&P related.

    Sherwood Castle has maintained a consistent payment rate over
    the past 18 months, and as a result S&P's payment rate base
    case remains unchanged. The payment rate is 14.50% as of May
    2011.

"Following our review, our base case assumptions for the Sherwood
Castle Trust are: Charge off 12.0%, yield 21.5%, and payment rate
12.0%," S&P said.

"On Jan. 20, 2011, we announced that Sherwood Castle Funding
Series 2004-1's class A notes were unaffected by our 2010
counterparty criteria due to an action plan (see 'Sponsors' Action
Plans Mitigate Initial Effect Of Revised Counterparty Criteria In
EMEA Structured Finance'). We can confirm that, in our opinion,
the transaction documents are in line with our 2010 counterparty
criteria (see 'Counterparty And Supporting Obligations Methodology
And Assumptions,' published on Dec. 6, 2010)," S&P said.

Ratings List

Class       Rating

Ratings Affirmed

Sherwood Castle Funding Series 2004-1 PLC
EUR630 Million Asset-Backed Floating-Rate Notes Series 2004-1

A           AAA (sf)
B           A (sf)
C           BBB (sf)

Sherwood Castle Funding Series 2004-2 PLC
GBP250 Million Asset-Backed Floating-Rate Notes Series 2004-2

A           AAA (sf)
B           A (sf)
C           BBB (sf)

Sherwood Castle Funding Series 2005-1 PLC
GBP350 Million Asset-Backed Floating-Rate Notes

A           AAA (sf)
B           A (sf)
C           BBB (sf)

Sherwood Castle Funding Series 2006-1 PLC
GBP55 Million, GBP16 Million Asset-Backed Floating-Rate Note

S1          BB (sf)
S2          BB (sf)


SIMCLAR GROUP: Former Director in Court Row Over House
------------------------------------------------------
Mark Williamson at Herald Scotland reports that Ian Durie, former
finance director of Simclar Group, is being prevented from selling
the home he has put on the market for almost GBP1 million amid the
fallout from the legal battle with liquidators of its Ayrshire
business.

A Court of Session judge, Lord Menzies, has imposed an Inhibition
on Mr. Durie at the request of the liquidators to Simclar
Ayrshire, according to Herald Scotland.

These are seeking the recovery of GBP3 million dividends paid by
the electronics firm that was closed down with the loss of 420
jobs in 2007, the report notes.

As reported in the Troubled Company Reporter on June 29, 2011, BBC
News said that Simclar Group has gone into administration putting
more than 200 jobs at risk in the process.  The administrators
from Deloittes are expected to keep Simclar, which owns operations
in China and the US, running while it seeks buyers for the
business, according to BBC News.  BBC News noted that Simclar
Group ran into problems when planned launches for new products,
including an energy-saving plug, were delayed.  John Reid and Bill
Dawson, of Deloittes, have been appointed by the directors of
Simclar Group as joint administrators of the company, which
employs 217 people in the UK, and certain subsidiary companies,
the report said.

Dunfermline-based Simclar Group supplies wiring, looms and sheet
metal products to major electronics firms.  Simclar Group was
formed in May 2001 and is the parent company of a subcontract
manufacturing group with operations in the UK, USA, Mexico and
China.  The UK operations supply a number of blue chip customers,
including Bombardier and Alexander Dennis.


SOUTHERN CROSS: NHP to Establish New Company to Run Care Homes
--------------------------------------------------------------
Simon Mundy at The Financial Times reports that NHP, owner of 249
care homes operated by Southern Cross, is to establish a new
company to run them, creating one of the biggest operators in the
sector.

According to the FT, NHP on Monday said it will set up a joint
venture with the healthcare consultancy Court Cavendish by the end
of October, when Southern Cross is expected to be wound up, NHP.

Staff at the homes would keep their jobs, and it would take over
some of Southern Cross's existing back office services, the FT
notes.

"This new operating company, which will rent and operate out of
the properties that NHP currently leases to Southern Cross, will
be robust and not subject to the same financial uncertainty that
has challenged Southern Cross," the FT quotes NHP as saying.

Southern Cross said last week that it would be wound up over the
next few months, the FT recounts.  The decision followed months of
tense negotiations with landlords, after fee cuts and falling
occupancy rates left it unable to meet its rent payments, the FT
relates.

Southern Cross Healthcare provides residential and nursing care to
more than 31,000 residents cared for by 45,000 staff in 750
locations.  It also operates homes that specialize in treating
people with dementia, mental health problems and learning
disabilities.


TITAN EUROPE: S&P Retains 'B-' Rating on Class E Notes
------------------------------------------------------
Standard & Poor's Ratings Services placed its credit ratings on
Titan Europe 2007-1 (NHP) Ltd.'s class A notes on CreditWatch
negative. The ratings on the other notes are unaffected.

"When we took rating action in June we maintained an investment-
grade rating on the class A notes to reflect our view that, based
on our interpretation of the transaction documents overall, the
class A notes should rank in priority to termination payments
under the forward swap," S&P said.

The CreditWatch placement is taken in the wake of market comment
that suggests that some parties may consider that the class A
notes rank junior to the swap.

"Although the transaction documents contain some provisions that
indicate that the forward swap may rank ahead of the class A
notes, our understanding is that, overall, these provisions are
countered by others in the documents. We consider that the range
of documentary provisions (including defined terms, security
arrangements, as well as certain agreements about application of
payments), when read and interpreted in the context of the
transaction documentation as a whole, provide support for the view
that the class A notes should rank ahead of termination payments
under the forward swap. We believe this view is supported by
certain statements to this effect in the transaction's offering
memorandum," S&P related.

"However, if key participants interpret the arrangements
differently to our interpretation and allocate accordingly, then
under our investment-grade stress scenarios the class A notes are
more likely to suffer losses. We await further clarification from
the servicer and issuer as to their formal interpretation. We may
lower the ratings on the class A notes if they confirm an
interpretation that is contrary to ours or if uncertainties
surrounding the interpretation of this structural issue persist,"
S&P added.

Ratings List

Titan Europe 2007-1 (NHP) Ltd.
EUR638.1 Million Commercial Mortgage-Backed Variable- and
Floating-Rate Notes

Class                 Rating
             To                   From

Rating Placed on CreditWatch Negative

A            BBB (sf)/Watch Neg   BBB (sf)

Ratings Unaffected

B            BB+ (sf)
C            BB (sf)
D            B+ (sf)
E            B- (sf)


URSUS 2 OCTANE: Fitch Affirms Rating on Class F Notes at 'BBsf'
---------------------------------------------------------------
Fitch Ratings has downgraded Ursus 2 (Octane) plc's (Ursus 2)
class C and D commercial mortgage-backed notes, due December 2019:

   -- GBP151.5m class A (XS0259730207): affirmed at 'AAAsf';
      Outlook Stable

   -- GBP49.0m class B (XS0259731270): affirmed at 'A+sf'; Outlook
      Stable

   -- GBP49.0m class C (XS0259731353): downgraded to 'Asf' from
      'A+sf'; Outlook Stable

   -- GBP27.2m class D (XS0259731437): downgraded to 'Asf' from
      'A+sf'; Outlook Stable

   -- GBP27.2m class E (XS0259731510): affirmed at 'BBBsf';
      Outlook Stable

   -- GBP27.2m class F (XS0259731783): affirmed at 'BBsf'; Outlook
      Stable

The rating actions have been driven by a deterioration in the
credit quality of the primary tenant in this transaction
accounting for 98.2% of passing rent, Shell UK Ltd. This operation
is a wholly-owned subsidiary of Royal Dutch Shell plc
('AA'/Stable/'F1+'), which Fitch downgraded in April. The tenant
is indirectly responsible for significant scheduled amortization
due under the loan by 2017. Although the tenant's rental
obligations are not guaranteed by its parent, the downgrade of the
latter means that less credit is given to scheduled amortization
in Fitch's cash flow scenarios, which explains the downgrades of
classes C and D.

While all note classes stand to benefit from scheduled
amortization, the class A and B notes' low leverage, coupled with
the overall solid quality of the collateral portfolio, represents
meaningful protection in the event of a tenant default. Meanwhile,
the high exit loan-to-value ratio (LTV), estimated at around 90%
by Fitch, means the class E and F notes' credit quality is weaker
than that of the tenant, and therefore somewhat insulated from its
credit quality.

The reported value of the collateral is almost unchanged since the
time of the last rating action in May 2010, falling by less than
1% between September 2008 and October 2009. The reported LTV
stands at 81.4%, below the covenanted 85%. Fitch's view of the
property value is unchanged since the last review and remains well
below the reported GBP406.79 million, which in turn has declined
from GBP463.0 million at closing.

Ursus 2 is a securitization of a single GBP351.6 million fixed-
rate commercial mortgage loan secured against 180 petrol filling
stations located across England, Wales and Scotland. The
properties, which are considered to be of an above-average quality
and of strategic importance in the sector, are mainly occupied by
Shell UK Limited under fully repairing and insuring (FRI) leases
expiring on November 29, 2019 (with a mutual break option in
December 2017). The November 2009 fixed rental uplift has raised
interest coverage to 1.47x from around 1.2x. Approximately 1.8% of
the portfolio by passing rent (or four assets) has been let to BP
Oil UK Limited, a subsidiary of BP Plc ('A'/Stable/'F1'), under a
lease expiring in December 2025. The assets were previously let to
Shell UK Limited, which surrendered the lease in February 2011.


WINDERMERE XI: Fitch Affirms Ratings on Two Classes of Notes at D
-----------------------------------------------------------------
Fitch Ratings has downgraded Windermere XI plc's commercial
mortgage-backed notes due April 2017:

   -- GBP465.5m Class A: downgraded to 'Bsf' from 'BBB-sf';
      Outlook Stable

   -- GBP53.5m Class B: downgraded to 'CCCsf' from 'Bsf'; Recovery
      Rating 'RR4'

   -- GBP41.8m Class C: downgraded to 'Csf' from 'CCsf'; Recovery
      Rating revised to 'RR6' from 'RR4'

   -- GBP19.0m Class D: affirmed at 'Dsf'; Recovery Rating 'RR6'

   -- GBP0m Class E: affirmed at 'Dsf'

The principal drivers of these rating actions are the lower-than-
expected recoveries on the Westville loan (12% of the pool) and
the deteriorating performance of the Devonshire House loan (32%)
since Fitch's last rating action in April 2010.

The Westville loan was transferred into special servicing in
July 2009 due to a payment default and is currently being
liquidated. Of the original 16 properties, eight have been sold to
date. Following the loan's transfer to special servicing, each of
the assets sold has resulted in recoveries below the allocated
loan amounts. The cumulative sales price to date is slightly lower
than the 2009 valuation (which was 56% below the closing
valuation), although with significant variation on an asset by
asset basis. Losses are exacerbated by the fact that the loan
continues to capitalize interest (including an additional 1% of
penalty interest) and that swap breakage costs rank senior to loan
recoveries. Fitch expects the securitized A-note to make a
significant loss that will result in a full write-down of the
remaining balance of the class D notes and a partial write-down of
the class C notes.

The Devonshire House loan is secured by a grade A office property
located in London's Mayfair. Lease expiries and a failure to re-
let previously vacant space have resulted in net rental income
being insufficient to cover debt service payments. While drawings
on an interest reserve account (established at closing) are
currently maintaining coverage at 1x, Fitch estimates that this
account will be fully drawn ahead of maturity in April 2014 unless
rental income improves in the interim. The risk of payment default
is coupled with high Fitch loan-to-value ratios (LTV) of 100% and
106% on the securitized A-note and whole loan, respectively.

The performance of the other three loans has been stable since
Fitch's last rating action. The Government Income Portfolio (20%
of the pool) and CAA House (16%) loans both mature in 2012; Fitch
estimates LTVs for both these loans in excess of 100%. The Long
Acre loan (20% of the pool) has a Fitch LTV of 94% and matures in
2014.


WOOD NEWTON: Enters Liquidation; 54 Workers Lose Jobs
-----------------------------------------------------
Grant Prior at Construction Enquirer reports that fit-out and
cladding specialist Wood Newton Limited has been put into
liquidation by RSM Tenon with the loss of 54 jobs.

The failure, says Construction Enquirer, comes just months after
the company completed the Olympic Velodrome's stunning wooden
exterior and roof.

Construction Enquirer says Wood Newton was a supply chain partner
to a string of major contractors including ISG, Lend Lease and
Taylor Wimpey.  The company had secured another Olympic contract
at Eton Manor.

"Wood Newton failed due to a combination of deferred start dates
for a number of contracts, payment disputes, and significant
under-payment of amounts owed to the company based on valuations,"
Construction Enquirer quotes Paul Finnity, at RSM Tenon's Derby
office, as saying.  "Unfortunately, 54 people have been made
redundant."

Nottinghamshire-based Wood Newton Limited specializes in high
quality fit out, external cladding/fa‡ade systems and low-cost,
high speed, environmentally friendly housing systems.


* UK: Business Insolvency Rate Drops in June, Experian Says
-----------------------------------------------------------
Nidaa Bakhsh at Bloomberg News, citing data compiled by Experian
Plc, reports that the number of large and medium-sized U.K.
businesses becoming insolvent fell in June.

Bloomberg relates that Experian said in an e-mailed statement that
the rate of failure for businesses with 101 to 500 employees
dropped to 0.08% last month from 0.17% a year earlier.  The
failure rate at businesses employing 51 to 100 workers declined to
0.19% from 0.23%.

According to Bloomberg, Experian said the south west of the U.K.
had the lowest rate of insolvency with 0.07% of businesses failing
while the number of insolvencies in the north west and Scotland
increased.

Experian, as cited by Bloomberg, revealed that the building-
materials industry had the highest failure rate at 0.27%, followed
by the construction industry with 0.18%.

Experian added that the failure rate for all U.K. businesses was
unchanged at 0.09%, Bloomberg reports.


                            *********

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 * * *