TCREUR_Public/110805.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Friday, August 5, 2011, Vol. 12, No. 154

                            Headlines



C Y P R U S

* CYPRUS: Likely to Seek Bailout Amid Power Shortages


F I N L A N D

STORA ENSO: Fitch Affirms Long-Term Foreign Currency IDR at 'BB'


F R A N C E

TYROL ACQUISITION: Moody's Assigns 'B2' CFR; Outlook Stable


G E R M A N Y

ADAM OPEL: Expects to Break-Even This Year; Has UK Union Pay Deal
PB CONSUMER: S&P Raises Rating on Class E Notes From 'BB'


I R E L A N D

ALLIED IRISH: Sells Outsourcing Operation to Capita for GBP29MM
ALLIED IRISH: Raises EUR6-Bil. from Finance Agency & NPRFC
ANGLO IRISH: No Legal Basis to Recover INBS Ex-CEO's Bonus
BALMORAL INT'L: Mulls Delisting Under Restructuring Plan
* IRELAND: NAMA Launches Firesale of 850 Properties


I T A L Y

CELL THERAPEUTICS: Reports US$12.93 Million Net Loss in June


L U X E M B O U R G

XELLA INT'L: S&P Assigns 'B+' Long-Term Corporate Credit Rating


N E T H E R L A N D S

B-ARENA NV: Fitch Affirms Class F Notes at 'BBsf'
HALCYON STRUCTURED: Moody's Raises Rating on Class E Notes to Ba2
MARCO POLO SEATRADE: Seeks Extension of Schedules Filing Deadline
MARCO POLO SEATRADE: Files List of 20 Largest Unsecured Creditors
MARCO POLO SEATRADE: Credit Agricole Questions Jurisdiction

NIBC BANK: Fitch Affirms Hybrid Capital Rating at 'BB+'


N O R W A Y

DALRADIAN EUROPEAN: Moody's Lifts Rating on Class E Notes to Caa3


R U S S I A

LSR OJSC: Fitch Affirms 'B' Long-Term Foreign Currency IDR
MEGAFON OAO: Fitch Affirms Long-Term Currency IDRs at 'BB+'
MOBILE TELESYSTEMS: S&P Puts BB Corp. Credit Rating on Watch Neg.
TRANSTELECOM JSC: Fitch Affirms 'B+' Long-Term IDR; Outlook Neg.


T U R K E Y

ALTERNATIFBANK: Fitch Affirms 'BB' Long-Term IDR; Outlook Stable
HABAS SINAI: Fitch Affirms Long-Terms Currency IDRs at 'B+'


U K R A I N E

* CITY OF KYIV: Fitch Affirms Long-Term Currency Ratings at 'B-'


U N I T E D   K I N G D O M

DAVIES ENFORCEMENT: Goes Into Liquidation
EAST LANCASHIRE WAREHOUSING: Firm's Building Attracts Bidders
EMI GROUP: Gets Early Bids; Sale for US$4 Billion Likely
EXCLUSIVE ASSET: Publicly Reprimanded Over Controls Failing
HOLIDAYS4U: Goes Into Administration, Cancels Flights

LLOYDS BANKING: Posts GBP2.3-Bil. Net Loss in First Half 2011
MAURICE PAYNE: Creditors to Challenge Administration
NEWCASTLE BUILDING: Moody's Affirms 'D-' BFSR; Outlook Negative
SCARISBRICK HOTEL: Britannia Buys Hotel Out of Administration
SPIRIT ISSUER: S&P Cuts Ratings on Five Note Classes to 'BB-'

WHITE TOWER: Fitch Affirms Rating on Class E Notes at 'Csf'
WILLIAM BALL: Goes Into Liquidation After CVA Fails
* UK: 8% of Retailers Likely to Enter Administration in 12 Months


X X X X X X X X

* EUROPE: EU Commission Urges States to Upgrade Rescue Fund
* Trouble in Europe Beckons U.S. Corporate Restructuring Experts
* BOOK REVIEW: Fraudulent Conveyances


                            *********


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C Y P R U S
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* CYPRUS: Likely to Seek Bailout Amid Power Shortages
-----------------------------------------------------
Emma Charlton and Stelios Orphanides at Bloomberg News report that
Cyprus may be forced to join euro-region counterparts Greece,
Ireland, and Portugal in asking for financial assistance amid
power shortages, a fiscal crisis, and 10-year bond yields above
10%.

An explosion last month destroyed a power station that provided
more than 50% of the island nation's electricity, Bloomberg
recounts.  The disaster occurred as the country's banks brace for
losses from their Greek government debt holdings.

Cyprus's credit rating was lowered by Moody's Investors Service on
July 27 and two of its banks were cut to junk the next day,
Bloomberg relates.

While Cyprus is about one-tenth the size of the Irish and
Portuguese economies, Bloomberg relates, a fourth bailed-out state
in little more than a year would further test euro-area leaders,
already under strain following last month's negotiations for a
second rescue package for Greece.

"There is a distinct risk that Cyprus will be the next bailout
candidate," Bloomberg quotes Christopher Rieger, head of fixed-
income strategy at Commerzbank AG in Frankfurt, as saying.  "Even
though it is a small market, if they need to be rescued, we will
also see countries complaining about another bailout."

"Cyprus is clearly on the verge of bankruptcy," Bloomberg quotes
Stuart Thomson, a fund manager at Ignis Asset Management in
Glasgow, as saying.  "Losses in the banking sector will drive it
into recession and will force the European institutions to provide
funds to bail out the banks. On top of that, the economy isn't
diversified enough to allow any way to grow out of these
problems."

There clearly is a financing pressure for Cyprus, according to
Bloomberg.  Cyprus must make a EUR1 billion (US$1.43 billion)
payment to bondholders in the first quarter of next year,
according to data from the national debt management office,
Bloomberg cites.  However, the Finance Ministry said on Aug. 1, as
cited by Bloomberg, the Cypriot government has EUR410 million in
cash and deposits to finance its debt and doesn't face any major
maturities until the middle of December, the Finance Ministry
said on Aug. 1.  The government needs a total of 650 million
euros in financing through mid-December, it said.


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F I N L A N D
=============


STORA ENSO: Fitch Affirms Long-Term Foreign Currency IDR at 'BB'
----------------------------------------------------------------
Fitch Ratings has affirmed Stora Enso Oyj's Long-term Foreign
currency Issuer Default Rating (IDR) at 'BB'. The Outlook is
Stable. The agency has also affirmed Stora Enso's senior unsecured
rating at 'BB' and Short-term IDR at 'B'.

The ratings and the Stable Outlook reflect the current positive
trend and the material improvement in the credit metrics achieved
by Stora Enso in 2010 and in H111, but, at the same time, reflect
Fitch's view that the printing paper sector's structural problems
of declining demand and overcapacity remain. Moreover, Stora
Enso's strategy, aiming at increasing its presence in more
attractive segments or markets will involve an increase in
investment, which could put pressure on the group's credit
metrics.

"Despite the positive trend posted in H111 by the company, the
short term outlook remains uncertain," said Lorenzo Re, Director
in Fitch's Corporates team. "Q211 showed some signs of slowdown in
the recovery against Q111, especially in printing and fine papers
and demand could weaken further in the next few months. Prices are
stabilizing, while raw material cost inflation persists for
recycled paper. This could put pressure on margins for some
divisions," adds Mr. Re.

In H111, Stora Enso's revenue increased by 11% to EUR5.5 billion
driven mainly by a solid recovery in prices, while volumes
remained uneven across the different segments. Reported recurring
EBIT climbed by 43% yoy with EBIT margin improving to 8.6% from
6.7%.

The company revised its capex guidance to EUR500 million for 2011
(from the previous guidance of EUR550 million). Fitch notes that,
this represents an increase from the 2009 and 2010's low level
(approximately EUR380 million-EUR390 million), but believes that
capex will increase further in 2012 and 2013 due to the investment
into the new containerboard machine in Poland. In addition, the
group will contribute to the equity in the new joint venture in
Uruguay, also guaranteeing its debt on a pro-rata basis.

Fitch expects free cash flow (FCF) to remain positive in the next
12-24 months, notwithstanding the expected increase in capex and
in dividends.

The confirmation of positive current trading with further
improvement in the credit metrics, in particular funds from
operations (FFO) adjusted leverage below 2.5x, could lead to a
positive rating action. The increasing of leverage, with FFO
adjusted leverage worsening to above 4.0x due to either a
deterioration in the operating performance or to extraordinary
activities (i.e. dividends, M&A activity) could drive a negative
rating action.

Stora Enso's liquidity is deemed adequate, with available cash in
excess of EUR1.0 billion at June 2011 plus the undrawn revolving-
credit-facility for EUR700 million (maturing in 2014). The group
has no significant debt maturities up to 2014, when a EUR750
million bond comes to maturity. Fitch notes that Stora Enso was
able to access the capital market with two bond issues in 2010
(for a total of SEK3.8 billion), to refinance part of its RCF and
to redeem a US$421 million bond maturing in 2011 early.


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F R A N C E
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TYROL ACQUISITION: Moody's Assigns 'B2' CFR; Outlook Stable
-----------------------------------------------------------
Moody's has assigned a definitive B2 corporate family rating (CFR)
and a B2 probability of default rating to Tyrol Acquisition 1 SAS
(a parent company for the TDF group; "TDF" or "the group").The
outlook on the ratings is stable.

This rating action follows the successful completion of TDF's bank
debt amendment and extension process (which required consent from
lenders with approximately 67% of the facilities commitments) on
July 22, 2011. TDF has reported 99% acceptance from the lenders
and extension of 93% of Facility A, Facility B, Accordion A,
Accordion B and Revolving Credit Facility (RCF) into a new term
loan and extended RCF with maturities in 2016.

Ratings Rationale

The B2 CFR reflects: (i) TDF's leading position as an incumbent
broadcasting infrastructure provider in France and Germany; (ii)
the limited number of competitors and high barriers to entry;
(iii) TDF's long-standing customer relationships with TV and radio
broadcasters as well as mobile-network-operators (MNOs); and (iv)
Moody's understanding that a majority of TDF's contracts have been
renewed for digital TV in the context of the analog terrestrial
switch-off in France, planned for November 2011.

The B2 CFR also reflects: (i) the possibility of a gradual erosion
in TDF's market shares in France; (ii) the weak positioning of DTT
as a technology platform for distributing TV in Germany; (iii) the
downward revenue and EBITDA trend associated with the transition
to digital and uncertainty regarding a return to meaningful
growth; and (iv) TDF's high financial leverage associated with an
expectation of negative free cash flow generation (as calculated
by Moody's -- including interest costs) over the medium term.

TDF is the incumbent terrestrial TV and Radio transmission
business and leading tower infrastructure provider in France. It
is also a leading digital terrestrial TV ("DTT") operator in
Germany, its second largest market. In FY2011, TDF generated
approximately 87% of its revenues in France and Germany. TDF also
operates in other European countries as an alternative
communications infrastructure provider. The group is owned by
private equity investors led by TPG, AXA, the FSI and
Charterhouse.


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


ADAM OPEL: Expects to Break-Even This Year; Has UK Union Pay Deal
-----------------------------------------------------------------
John Reed at The Financial Times reports that General Motors'
European head has said that the carmaker's regional unit in
Germany is ahead of its plan to break even this year.

The FT relates that Nick Reilly, president of GM Europe and
chairman of the Opel/Vauxhall supervisory board, also said on
Wednesday that the carmaker had reached agreement with its UK
union on a two-year 4.5% pay rise.

GM's Opel unit has long been a lossmaker for the Detroit carmaker
and in recent months, the subject of speculation that it might be
up for sale, which chief executive Dan Akerson recently denied,
the FT discloses.

When asked whether GM had been approached by a rival carmaker
seeking to buy Opel, Mr. Reilly, as cited by the FT, said: "Not as
far as I know."

However, he said, GM was "frequently talking" to other producers
about alliances in new technology, especially in areas such as
vehicle electrification, where many carmakers are seeking to cut
costs, the FT notes.

In 2009, as GM was restructuring in bankruptcy in the US, it
embarked on talks to sell Opel to outside investors, before
pulling the plug on the sale in a move that infuriated the
government and its union in Germany, the FT recounts.

Opel, which trades as Vauxhall in the UK, has over the past two
years completed a restructuring plan that saw it cut about 8,000
jobs, freeze wages, and close a production plant in Antwerp in an
attempt to make the business more competitive, the FT states.

                         About Adam Opel

Adam Opel GmbH -- http://www.opel.com/-- is General Motors
Corp.'s German wholly owned subsidiary.  Opel started making cars
in 1899.  Opel makes passenger cars (including the Astra, Corsa,
and Vectra) and light commercial vehicles (Combo and Movano).  Its
high-performance VXR range includes souped-up versions of Opel
models like the Meriva minivan, the Corsa hatchback, and the Astra
sports compact.  Opel is GM's largest subsidiary outside North
America.


PB CONSUMER: S&P Raises Rating on Class E Notes From 'BB'
---------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on PB
Consumer 2008-1 GmbH's class B, C, D, and E notes. "At the same
time, we affirmed our rating on the class A notes," S&P related.

"The rating actions follow our performance review of the
transaction. The transaction's performance has exceeded our base
case assumptions at closing. Cumulative gross losses for the
underlying pool are 1.60%, which remains within our base case
assumption at closing," S&P said.

The current pool factor is 10.57% and the liquidity reserve amount
remains at its required floor of EUR5 million.

The upgrades reflect the fact that the transaction has amortized
significantly and that the underlying pool continues to
demonstrate strong performance.

The transaction closed in January 2008 and is backed by a static
portfolio of unsecured consumer loans that Deutsche Postbank AG
originated. The loans are fixed-rate unsecured loans to German
consumers. The portfolio comprises loans that pay monthly
installments and bear fixed-rate interest rates, without
resets. At closing, PB Consumer 2008-1 entered into a
fixed/floating interest rate swap with Societe Generale to hedge
the mismatch between the fixed-rate paying assets and floating
liabilities. "In our analysis of this transaction, we did not give
benefit to the swap and so this transaction is not affected by
our 2010 counterparty criteria," S&P said.

Ratings List

Class            Rating
            To            From

PB Consumer 2008-1 GmbH
EUR1.168 Billion Floating-Rate Asset-Backed and Liquidity Reserve
Notes

Ratings Raised

B           AAA (sf)      AA (sf)
C           AA (sf)       A (sf)
D           A (sf)        BBB (sf)
E           BBB (sf)      BB (sf)

Rating Affirmed

A           AAA (sf)


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I R E L A N D
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ALLIED IRISH: Sells Outsourcing Operation to Capita for GBP29MM
---------------------------------------------------------------
Fiona Reddan at The Irish Times reports that Allied Irish Banks
plc has agreed to sell its outsourcing operation, AIB
International Financial Services (AIB IFS), to UK business
outsourcing group Capita for GBP29 million (EUR33.1 million).

According to The Irish Times, a spokesman for AIB said that given
the division's focus on the international market the divestment
was in line with the bank's strategy of disposing of non-core
activities and concentrating on the domestic market.

AIB IFS employs 160 people -- 100 in its operations in the IFSC,
and 60 internationally -- and provides outsourced services such as
corporate administration, treasury management, securitization,
aviation leasing and middle and back office services to financial
institutions and corporate clients, The Irish Times discloses.

The deal is expected to close, pending regulatory approval, in six
weeks, The Irish Times states.

                  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 $2.87 billion of interest income for
2009.

The Company's balance sheet at June 30, 2011, showed EUR126.87
billion in total assets, EUR120.01 billion in total liabilities,
and EUR6.86 billion total shareholders' equity including non-
controlling interest.


ALLIED IRISH: Raises EUR6-Bil. from Finance Agency & NPRFC
----------------------------------------------------------
Allied Irish Banks, p.l.c., in order to raise capital has issued
500,000,000,000 Ordinary Shares of EUR0.01 each to the National
Pensions Reserve Fund Commission at a subscription price of
EUR0.01 per share and EUR1.6 billion of contingent capital notes
at par to the Minister for Finance raising in aggregate proceeds
of EUR6.6 billion.

In addition, further to its announcement on May 13, 2011, AIB has
issued an additional 762,370,687 new Ordinary Shares to the NPRFC
in lieu of the remainder of the 2011 annual cash dividend on the
2009 Preference Shares that was deferred on May 13, 2011.  The
2011 Bonus Issue includes an increment of 38,118,534 new Ordinary
Shares prescribed by AIB's articles of association as a result of
the 2011 annual cash dividend not being satisfied in full on the
due date.  This represents an increase of 1,905,926 shares over
the figure included in AIB's shareholder circular dated July 1,
2011, as a result of finalization of calculations of the number of
Ordinary Shares to be issued in lieu of the 2011 Bonus Issue.
Following the Placing and the 2011 Bonus Issue, the NPRFC's
shareholding in the enlarged total issued ordinary share capital
of AIB has increased from c.93.1% to c.99.8%.  AIB now has
513,493,126,277 Ordinary Shares of EUR0.01 each in issue.

AIB has applied to the Irish Stock Exchange to list the new
Ordinary Shares issued in connection with the Placing and the 2011
Bonus Issue on the Enterprise Securities Market of the ISE and to
admit those Ordinary Shares to trading on the ESM.  It is expected
that admission will occur at 8.00 a.m., on Aug. 2, 2011.

In addition, following the Renominalisation, AIB has acquired
395,759,506,824 Deferred Shares for nil consideration and
immediately cancelled them in accordance with its articles of
association, as described in the shareholder circular issued by
AIB on July 1, 2011.  Subject to the confirmation of the High
Court, AIB intends to write off accumulated losses through the
cancellation of the capital redemption reserve created on the
acquisition and cancellation of the Deferred Shares in due course.
AIB is required to raise a total of c.EUR14.8 billion of Core Tier
1 Capital, of which EUR1.6 billion may be in the form of
contingent capital, by July 31, 2011.  As announced on July 1,
2011, the Minister has indicated his intention to make a capital
contribution in favor of AIB in order to satisfy any portion of
the PCAR Requirement not satisfied by the Capital Raising, other
capital generating exercises undertaken by AIB and EBS Limited and
further burden-sharing measures undertaken with the Group's
subordinated debt holders.  AIB expects the Minister and the NPRFC
to provide capital contributions to AIB shortly in order to
satisfy the portion of the PCAR Requirement not already satisfied.

Once the proceeds of the Capital Raising and the Capital
Contributions have been received, AIB expects that it will have
the necessary capital to meet the PCAR Requirement.

AIB's Board of Directors acknowledges the continued support of the
Minister and the Irish State.

In a separate press release, AIB announced that the Minister for
Finance and the National Pensions Reserve Fund Commission have
made capital contributions in the aggregate amount of c. EUR6.054
billion to AIB for no consideration.  Accordingly, no new Ordinary
Shares have been issued by AIB to the Minister and the NPRFC in
return for the Capital Contributions.  AIB is required to raise a
total of c.EUR14.8 billion of Core Tier 1 Capital, of which EUR1.6
billion may be in the form of contingent capital, by July 31,
2011.  The Capital Contributions were made in order to satisfy the
portion of the PCAR Requirement not satisfied by AIB's placing of
EUR5 billion of new Ordinary Shares with the NPRFC and the issue
of EUR1.6 billion of contingent capital notes at par to the
Minister, which completed on July 27, 2011, other capital
generating exercises undertaken by AIB and EBS Limited and further
burden-sharing measures undertaken with the Group's subordinated
debt holders.

As a result of the proceeds of the Capital Raising and the Capital
Contributions, AIB has now received the necessary capital to meet
the PCAR Requirement.  This has been confirmed by the Central Bank
of Ireland.

                  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 $2.87 billion of interest income for
2009.

The Company's balance sheet at June 30, 2011, showed EUR126.87
billion in total assets, EUR120.01 billion in total liabilities
and EUR6.86 billion total shareholders' equity including non-
controlling interest.


ANGLO IRISH: No Legal Basis to Recover INBS Ex-CEO's Bonus
----------------------------------------------------------
Conor Keane at Irish Examiner reports that Anglo Irish Bank has
refused to divulge if it has any leverage to force former Irish
Nationwide Building Society chief executive Michael Fingleton to
give back a EUR1 million bonus and watch worth EUR11,500 given to
him on his retirement.

Irish Examiner relates that Anglo chairman Alan Dukes said
Mr. Fingleton should return the watch and bonus immediately, but
admitted they did not have a legal basis to recover them.

According to Irish Examiner, Mr. Dukes refused to say if there was
"any" leverage they could use to secure the return of the "utterly
inappropriate" cash and "gift".

In 2009, Mr. Fingleton said he would pay back the EUR1 million
bonus, Irish Examiner recounts. INBS did hold back EUR400,000 of
the bonus to pay tax, but Mr. Fingleton received EUR600,000, Irish
Examiner notes.  His overall retirement pension pot was EUR27.6
million, Irish Examiner states.

As reported by the Troubled Company Reporter-Europe on July 1,
2011, BreakingNews.ie related that The European Commission cleared
a bailout plan for Anglo Irish Bank and the Irish Nationwide
Building Society.  BreakingNews.ie disclosed that the proposal,
which was submitted for approval in January, provides for the
merger of the two troubled institutions and their winding down
over the next 10 years.  Anglo Irish and Irish Nationwide jointly
received EUR34.7 billion in capital injections from the State to
cover losses on property loans, BreakingNews.ie noted.

Anglo Irish Bank Corp PLC -- http://www.angloirishbank.com/--
operates in three core areas: business lending, treasury and
private banking.  The Bank's non-retail business is made up of
more than 11,000 commercial depositors spanning commercial
entities, charities, public sector bodies, pension funds, credit
unions and other non-bank financial institutions.  The Company's
retail deposits comprise demand, notice and fixed term deposit
accounts from personal savers with maturities of up to two years.
Non-retail deposits are sourced from commercial entities,
charities, public sector bodies, pension funds, credit unions and
other non-bank financial institutions.  In addition, at Sept. 30,
2008, its non-retail deposits included deposits from Irish
Life Assurance plc.  The Private Bank offers tailored products and
solutions for high net worth clients and operates the Bank's
lending business in Ireland and the United Kingdom.


BALMORAL INT'L: Mulls Delisting Under Restructuring Plan
--------------------------------------------------------
Suzanne Lynch at the Irish Times reports that shares in Balmoral
International Land, formerly Blackrock International, are to be
traded on a grey market if a plan to restructure the company is
passed by shareholders.

The Irish Times relates that on Tuesday, Balmoral announced plans
to delist from the ESM and AIM "junior" exchanges in Dublin and
London respectively and establish a new group holding company,
Balmoral Holdings, which will hold all of the ordinary shares in
the company.

The Fyffes spin-off, which is in negotiations with lenders about
its debt, as cited by The Irish Times, said a "new unencumbered
group" is needed to facilitate the raising of further equity.
According to The Irish Times, it plans to enter the new company on
a publicly quoted market "as soon as this is practically feasible
in the future."

The immediate effect of the delisting will be that shares will be
traded on a grey market administered by Davy Stockbroker, The
Irish Times states.

The deal, which needs to be approved by 75% of shareholders at an
extraordinary general meeting on August 25 will see shareholders
receive one new share in Balmoral Holdings for each existing
Balmoral International Land share held, The Irish Times discloses.

The restructuring is connected with the company's loan repayments,
The Irish Times notes.  Net borrowings at end-2010 amounted to
EUR180.5 million, according to The Irish Times.  Approximately
EUR130 million of this is subject to a loan-to-value covenant of
50%, The Irish Times says.

The year-end ratio of group net borrowings to group property was
84.5% according to the company's accounts and Balmoral is now in
breach of those covenants, The Irish Times relates.

Balmoral International Land is a property company.  It has
interests in more than 60 properties in Ireland, Britain and
Europe.


* IRELAND: NAMA Launches Firesale of 850 Properties
---------------------------------------------------
The Guardian reports that the National Asset Management Agency,
which has been tasked with clearing the mountain of bad debt
amassed by Ireland's property developers, has launched a firesale
of 850 properties including pubs in Somerset, towers blocks in
Canary Wharf, and golf courses in Ireland.

The bad bank has just published a full list of properties across
the UK and Ireland that are effectively up for sale, having been
placed in receivership, The Guardian relates.  It has already been
inundated with hundreds of calls from bargain hunters, The
Guardian notes.

Some 32% of the list is in the UK and includes properties in all
parts of the country. Properties in Ireland include golf courses,
five-star hotels, medical centers, homes in Dublin's salubrious
Ballsbridge district, and an airport in county Kildare, The
Guardian discloses.

NAMA revealed that three of the top developers are responsible for
EUR8.4 billion of the debt, The Guardian notes.


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


CELL THERAPEUTICS: Reports US$12.93 Million Net Loss in June
------------------------------------------------------------
Cell Therapeutics, Inc. related that it incurred a net loss
attributable to common shareholders of US$12.93 million for the
month ended June 30, 2011.

The Company is providing the information pursuant to a request
from the Italian securities regulatory authority, CONSOB, pursuant
to Article 114, Section 5 of the Unified Financial Act, that the
Company issue at the end of each month a press release providing a
monthly update of certain information relating to the Company's
management and financial situation.

A full-text copy of the press release is available for free at:

                        http://is.gd/c3ETTB

                      About Cell Therapeutics

Headquartered in Seattle, Washington, Cell Therapeutics, Inc.
(NASDAQ and MTA: CTIC) -- http://www.CellTherapeutics.com/-- is a
biopharmaceutical company committed to developing an integrated
portfolio of oncology products aimed at making cancer more
treatable.

The Company reported a net loss of US$82.64 million on US$319,000
of revenue for the 12 months ended Dec. 31, 2010, compared with a
net loss of US$82.64 million on US$80,000 of total revenue during
the same period in 2009.

The Company's balance sheet at March 31, 2011 showed
US$60.92 million in total assets, US$43.11 million in total
liabilities, US$13.46 million in common stock purchase warrants
and US$4.35 million total shareholders' equity.

Marcum LLP, in San Francisco, Calif., expressed substantial doubt
about the Company's ability to continue as a going concern in its
audit reports for the financial statements for 2009 and 2010.  The
independent auditors noted that the Company has incurred losses
since its inception, and has a working capital deficiency of
approximately US$14.2 million at Dec. 31, 2010.


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


XELLA INT'L: S&P Assigns 'B+' Long-Term Corporate Credit Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' long-term
corporate credit rating to Luxembourg-registered building
materials manufacturer Xella International S.A.  The outlook is
stable.

"In addition, we assigned a 'B+' issue rating to the
EUR300 million senior secured notes issued by Xella's financing
vehicle Xefin Lux S.C.A. The recovery rating on the notes is '3',
reflecting our expectation of meaningful (50%-70%) recovery in the
event of a payment default," S&P related.

"The ratings are in line with our preliminary ratings on Xella,
assigned on May 23, 2011, and are based on our satisfactory review
of the final documentation. The documentation includes the
accounts of Xella's parent Xella International Holdings S.a.r.l.
The ratings are not affected by the recent announcement of the
potential acquisition of the Gasbeton business unit from RDB SpA
(not rated)," S&P said.

"The rating on Xella reflects our view of the group's high
leverage, with Standard & Poor's-adjusted total debt of about
EUR1.7 billion. The rating also reflects the group's exposure to
highly cyclical end-markets, in particular, the residential
construction industry. The group has more limited scale and
diversity than some of its peers, and exposure to volatile energy
costs, which have contributed to some instability in profitability
and operating margins in recent years. These risks are partially
mitigated by Xella's leading market position within the premium
and relatively niche end of the building materials market; strong
growth prospects through increasing market share; emerging-market
investments; and a likely near-term recovery in the majority
of Xella's mature and relatively stable markets," S&P related.

"In our view, Xella's net leverage should improve as a result of
healthy free operating cash flow generation. The latter should
adequately cover minimal short-term financial obligations in the
absence of near-term debt repayment or refinancing commitments,"
S&P said.

"We believe that adjusted credit metrics should steadily improve
over the coming years, with FFO to debt of about 10% by the end of
2011. However, ratings upside remains limited in the near term due
to Xella's high debt burden," S&P said.

"The ratings could come under pressure if Xella's earnings growth
were to fall significantly short of our forecasts -- in
particular, if cash flow metrics were weaker than we anticipate
given likely future changes in the capital structure. Downward
pressure on the ratings could also arise if we came to view the
group's liquidity situation as less than adequate, or if capex or
acquisitions were materially higher than our current assumptions,"
S&P related.


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


B-ARENA NV: Fitch Affirms Class F Notes at 'BBsf'
-------------------------------------------------
Fitch Ratings has affirmed B-Arena N.V./S.A.'s notes:

   -- EUR920m class A notes, affirmed at 'AAAsf'; Outlook Stable

   -- EUR20m class B notes, affirmed at 'AAsf'; Outlook Stable

   -- EUR20m class C notes, affirmed at 'Asf'; Outlook Stable

   -- EUR18m class D notes, affirmed at 'BBBsf'; Outlook Stable

   -- EUR10.5m class E notes, affirmed at 'BBB-sf'; Outlook Stable

   -- EUR11.5m class F notes, affirmed at 'BBsf'; Outlook Stable

The rating actions reflect the continued credit support available
to the notes, provided by the available subordination and cash-
reserve, as well as an additional 10bp excess spread margin per
quarter provided under the swap agreement.

The transaction's five-year revolving period will end in October
2011, until which time the principal proceeds received from the
borrowers will be utilized to purchase new assets in the pool.
Following the end of this revolving period, the notes will
amortize in sequential order.

The transaction's overall performance remains strong, with low 90+
days past due delinquency levels of 0.2% reported as of April 2011
and with no losses and minimal defaults reported to date. In
addition, the transaction's reserve fund and liquidity facility
remain fully funded, at EUR10 million and EUR30 million,
respectively.

However, it is worth noting that the transaction operates a non-
standard principal deficiency mechanism. Loans are registered on
the loss ledger as soon as they are over 60 days in arrears, for a
loss amount to be determined by the seller and adjusted over time,
if need be, until the loss is realized. Such amounts will remain
at the debit of the quarterly realized loss ledger until the
quarterly period in which the loss is realized. At such time, if
the losses are not cured by the then available funds in the
period, they will be deleted from the ledger. As a result, unless
there is sufficient excess spread to cure such losses in the
period in which they are realized, they will not be compensated in
the future, except via potential post-foreclosure proceeds. This
mechanism was factored into Fitch's initial cash-flow analysis.


HALCYON STRUCTURED: Moody's Raises Rating on Class E Notes to Ba2
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Halcyon Structured Asset Management European CLO 2006-I
B.V.:

Issuer: Halcyon Structured Asset Management European CLO 2006-I
B.V.

   -- EUR40M Class B Senior Secured Floating Rate Notes due 2021,
      Upgraded to Aa2 (sf); previously on Jun 22, 2011 Aa3 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR30M Class C Senior Secured Deferrable Floating Rate Notes
      due 2021, Upgraded to A3 (sf); previously on Jun 22, 2011
      Baa3 (sf) Placed Under Review for Possible Upgrade

   -- EUR15M Class D Senior Secured Deferrable Floating Rate Notes
      due 2021, Upgraded to Baa3 (sf); previously on Jun 22, 2011
      Ba3 (sf) Placed Under Review for Possible Upgrade

   -- EUR20M Class E Senior Secured Deferrable Floating Rate Notes
      due 2021, Upgraded to Ba2 (sf); previously on Jun 22, 2011
      Caa1 (sf) Placed Under Review for Possible Upgrade

Ratings Rationale

Halcyon Structured Asset Management European CLO 2006-I B.V.,
issued in June 2006, is a multi-currency Collateralised Loan
Obligation ("CLO") backed by a portfolio of mostly high yield
European loans. The portfolio is managed by Halcyon Structured
Asset Management L.P. This transaction has been in reinvestment
period until 21 July 2011.

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 also reflect
consideration mainly of an increase in the transaction's
overcollateralization ratio as well as slight credit improvement
of the underlying portfolio.

The actions reflect key changes to the modelling 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 modelling framework. Additional changes to the
modelling assumptions include standardizing the modelling of the
collateral amortization profile and changing certain credit
estimate stresses aimed at addressing time lags in receiving
information required for credit estimate updates

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 relatively
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 2790 compared to 2689 in the October 2009
report, and securities rated Caa or lower make up approximately
6.5% of the underlying portfolio versus 7.6% in October 2009. The
change 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 1 September 2010.

Defaulted securities total about EUR5.2 million of the underlying
portfolio compared to EUR31.4 million in October 2009. The
overcollateralization ratios of the rated notes have also improved
since the rating action in November 2009. The Class B, Class C,
Class D and Class E overcollateralization ratios are reported at
136%, 122%, 116% and 109% respectively, versus October 2009 levels
of 128%, 115%, 110% and 103%, respectively, and all related
overcollateralization tests are currently in compliance.

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 371.6
million, defaulted par of EUR5.1 million, a weighted average
default probability of 22.1% (consistent with a WARF of 3070), a
weighted average recovery rate upon default of 44.9%, and a
diversity score of 32. 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, especially as exposures
to obligors domiciled in Spain, Ireland and Italy total around 15%
of the portfolio, 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.

Sources of additional performance uncertainties are:

1) 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.

2) Moody's also notes that around 60% 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.

3) The deal has significant exposure to GBP denominated assets.
   Volatilities in foreign exchange rate will have a direct impact
   on interest and principal proceeds available to the
   transaction, which may affect the expected loss of the rated
   tranches.

The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011. Please see the Credit Policy page on www.moodys.com for
a copy of this methodology.

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. [In addition, due to the low
diversity of the collateral pool, Moody's CDOROMTM was used to
simulate default scenarios then applied as an input in the cash
flow model.

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.


MARCO POLO SEATRADE: Seeks Extension of Schedules Filing Deadline
-----------------------------------------------------------------
Marco Polo Seatrade B.V. and certain of its affiliates ask the
U.S. Bankruptcy Court for the Southern District of New York to
extend the 15-day period to file their schedules of assets and
liabilities, schedules of current income and expenditures,
schedules of executory contracts and unexpired leases, and
statements of financial affairs for an additional 30 days, or 45
days from the Petition Date, without prejudice to the Debtors'
right to request additional time if necessary.

Pursuant to Section 521 of the Bankruptcy Code and Rule 1007(c) of
the Federal Rules of Bankruptcy Procedure, the Debtors would be
required to file the Schedules and Statements within 14 days after
the Petition Date.  However, the Court is authorized to extend the
filing deadline for cause by Bankruptcy Rules 1007(c) and 9006(b).

The Debtors said they were forced to file for bankruptcy with less
than 24 hours' notice.  The Debtors said the scope and complexity
of their businesses, coupled with the limited time and resources
available to them to gather the required information and prepare
and file their Schedules and Statements, warrant an extension of
the filing deadline.  While the Debtors have commenced, and are in
the process of, gathering the necessary information, it will be
close to impossible to properly and accurately complete and file
the Schedules and Statements within the 14-day period after the
Petition Date as provided by Bankruptcy Rule 1007(c).

                     About Marco Polo Seatrade

Marco Polo Seatrade B.V. operates an international commercial
vessel management company that specializes in providing commercial
and technical vessel management services to third parties.
Founded in 2005, the Company mainly operates under the name of
Seaarland Shipping Management and maintains corporate headquarters
in Amsterdam, the Netherlands.  The primary assets consist of six
tankers that are regularly employed in international trade, and
call upon ports worldwide.

Marco Polo and three affiliated entities filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-13634) on July 29,
2011.  The other affiliates are Seaarland Shipping Management
B.V.; Magellano Marine C.V.; and Cargoship Maritime B.V.

Marco Polo is the sole owner of Seaarland, which in turn is the
sole owner of Cargoship, and also holds a 5% stake in Magellano.
The remaining 95% stake in Magellano is owned by Amsterdam-based
Poule B.V., while another Amsterdam company, Falm International
Holding B.V. is the sole owner of Marco Polo.  Falm and Poule
didn't file bankruptcy petitions.

The filings were prompted after lender Credit Agricole Corporate &
Investment Bank seized one ship on July 21, 2011, and was on the
cusp of seizing two more on July 29.  The arrest of the vessel was
authorized by the U.K. Admiralty Court.  Credit Agricole also
attached a bank account with almost US$1.8 million on July 29.
The Chapter 11 filing precluded the seizure of the two other
vessels.

Evan D. Flaschen, Esq., Robert G. Burns, Esq., and Andrew J.
Schoulder, Esq., at Bracewell & Giuliani LLP, serve as bankruptcy
counsel.  The cases are before Judge James M. Peck.

The petition said assets and debt are both more than US$100
million and less than US$500 million.


MARCO POLO SEATRADE: Files List of 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Marco Polo Seatrade B.V., et al. filed with the U.S. Bankruptcy
Court for the Southern District of New York a consolidated list of
their creditors holding the 20 largest unsecured claims:

   Creditor                   Nature of Claim   Amount of Claim
   --------                   ---------------   ---------------
Deutsche Schiffsbank AG       Bank loan              US$8,640,000
Domshof 17
Bremen, Germany D-28195
Attn: Peter Zimmermann
Fax: +49 421 3609 329
E-mail: peter.zimmermann@schiffsbank.com

DS-Rendite-Fonds Nr. 123 DS   Trade                  US$4,081,060
Sapphire GmbH & Co.
Tankschiff K.G.
Stockholmer Allee 53
Dortmund, Germany 44269
Attn: Thomas M. Dewner
E-mail: td@dr-peters.de

Indiana R. Shipping Ltd.      Trade                  US$2,087,665
Broadstreet 80
Monrovia, Liberia
Attn: Andreas Louka
Fax: + 30 210 80 20 364
E-mail: legal@centralmare.com

Banksy Shipping Company Ltd.  Trade                  US$1,776,896
Broadstreet 80
Monrovia, Liberia
Attn: Andreas Louka
Fax: + 30 210 80 20 364
E-mail: legal@centralmare.com

Bentonwood B.V.               Trade                  US$1,336,750
Sloterkade 182 hs
Amsterdam, the Netherlands
1059 EB
Attn: Martin Slagter
E-mail: accounting@marwave.nl

San Lorenzo Seatrade Corp.    Trade                    US$478,985
Broadstreet 80
Monrovia, Liberia
Attn: Johan Ebner
Fax: +41 (91) 92 35 862
E-mail: johann.ebner@seaarland.at

Lazard & Co S.r.L.            Professional             US$101,985
Via Brera 3
Milano, Italy 20121
Attn: Maurizio Montesi
Fax: +44(0)7801136158
E-mail: maurizio.montesi@lazard.com

E-mtp LLC                     Trade                     US$78,133
3501 Silverside RD
Wilmington, Delaware 19810
E-mail: accounting@e-mtp.biz

Ligabue S.r.L.                Trade                     US$62,264
Piazzale Roma 499
Venice, Italy 30135
Fax: +39 041 2705661
E-mail: shipsupply@ligabue.it

Ifchor Group S.A.             Trade                     US$54,384
Place Pepinet 1
Lausanne, Switzerland CH-1003
Attn: Giuseppe Ravano
Fax: +41 21 310 31 00
E-mail: panamax@ifchor.ch

Loyens & Loeff N.V.           Professional              US$54,362
Blaak 31
Rotterdam, the Netherlands
3000 CW
Attn: Ria Dekkers
Fax: +31 10 4125 839
E-mail: ria.dekkers@loyensloeff.com

Venice Shipping and           Trade                     US$41,666
Logistics S.p.A.
Via Fiori Oscun 11
Milano, Italy 20121
Attn: Massimo Mare
E-mail: Massimo.Mare@vslspa.it

RINA Services S.p.A.          Trade                     US$30,604
Via Corsica 12
Genova, Italy 16128
E-mail: machinery.section@rina.org

Cambiaso Risso                Trade                     US$26,944
Marine S.p.A.
Corso Andrea Podesta 1
Genova, Italy 16128
Fax: +39 010 589359
E-mail: info@cambiasorisso.it

Krohne Skarpenord             Trade                     US$21,938
Messtechnik GmbH
Ludwig-Krohne-StraŠe
Duisburg, Germany 47058
Fax: +49 (0)203 301 10 389
E-mail: info@krohne.de

ISS Tositti S.r.L.            Trade                     US$21,843
Fabricato 17
Venice, Italy 30123
Fax: +39 041 271 2648
E-mail: venezia@iss-tositti.it

Burke & Novi S.r.L.           Trade                     US$20,668
Via Domenico Fiasella 4/14
Genova, Italy 16121
Attn: Franco Novi

Burke Novi Sam                Trade                     US$18,924
7 Rue du Gabian
Monaco MC 98000
Attn: sandp@burkenovi.com
E-mail: tankers@burkenovi.mc

Stratos Global                Trade                     US$18,668
Loire 158-160
Den Haag, the Netherlands
2500 GA
Fax: +31 (0)70 4461 763
E-mail: billingcs@stratosglobal.com

C.A.I.M. scrl                 Trade                     US$17,347
Via G. Dannunzio 2/66
Genova, Italy
Fax: + 39 010 589818
E-mail: caim@caim.it

                     About Marco Polo Seatrade

Marco Polo Seatrade B.V. operates an international commercial
vessel management company that specializes in providing commercial
and technical vessel management services to third parties.
Founded in 2005, the Company mainly operates under the name of
Seaarland Shipping Management and maintains corporate headquarters
in Amsterdam, the Netherlands.  The primary assets consist of six
tankers that are regularly employed in international trade, and
call upon ports worldwide.

Marco Polo and three affiliated entities filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-13634) on July 29,
2011.  The other affiliates are Seaarland Shipping Management
B.V.; Magellano Marine C.V.; and Cargoship Maritime B.V.

Marco Polo is the sole owner of Seaarland, which in turn is the
sole owner of Cargoship, and also holds a 5% stake in Magellano.
The remaining 95% stake in Magellano is owned by Amsterdam-based
Poule B.V., while another Amsterdam company, Falm International
Holding B.V. is the sole owner of Marco Polo.  Falm and Poule
didn't file bankruptcy petitions.

Evan D. Flaschen, Esq., Robert G. Burns, Esq., and Andrew J.
Schoulder, Esq., at Bracewell & Giuliani LLP, serve as bankruptcy
counsel.  The cases are before Judge James M. Peck.

The petition said assets and debt are both more than US$100
million and less than US$500 million.


MARCO POLO SEATRADE: Credit Agricole Questions Jurisdiction
-----------------------------------------------------------
Credit Agricole Corporate and Investment Bank on Tuesday filed
with the U.S. Bankruptcy Court for the Southern District of New
York an objection to Marco Polo Seatrade B.V., et al's request to
use cash collateral, calling the Debtors' bankruptcy filing a
"sham" to harass Credit Agricole and attempt to thwart its ability
to realize on its secured interest in the collateral.

Credit Agricole also pointed out the Debtors have no actual
connection with the Court's jurisdiction.

Credit Agricole serves as agent, security trustee, swap bank and
issuing bank, pursuant to a loan agreement dated Sept. 22, 2005,
with Marco Polo.  Credit Agricole holds first preferred
shipmortgages over three of the Debtors' vessels.

The Marco Polo Seatrade bankruptcy filings were prompted after
Credit Agricole seized one ship on July 21, 2011, and was on the
cusp of seizing two more on July 29.  The arrest of the vessel was
authorized by the U.K. Admiralty Court.  Credit Agricole also
swept nearly US$1.8 million from the Debtors' operating accounts
on July 29.  The Chapter 11 filing precluded the seizure of the
two other vessels.

Credit Agricole said that as of July 27, US$87.7 million, plus all
accrued interest, were due under the Loan.

In their request to use Cash Collateral, the Debtors said the
US$1.8 million Cash Sweep stripped them of a significant portion
of their working capital.  For the Debtors to succeed, their fleet
of tankers must continue to operate on the high seas without
interruption.  To achieve that, the Debtors must have access to
their remaining Cash Collateral, as well as Cash Collateral
generated from future receivables and other revenues.  If deprived
of their Cash Collateral, the Debtors said they will be unable to
pay for the fuel that powers the vessels, to pay the crews that
maintain and navigate them, to purchase the parts and materials
necessary to keep them sailing, and to provide for an extensive
list of other items necessary for the operation of the Debtors'
businesses.  If the Debtors are permitted to use their cash
collateral, they estimate that it will enable them to generate
monthly revenues of roughly US$2.5 million, which they further
estimate will be sufficient to operate the business and this
restructuring case.  However, every day that a single tanker is
unable to operate, the Debtors move one step closer to being
rendered incapable of surviving as a going concern.

The Debtors have filed a one-page consolidated cashflow for the
period from July 29, 2011, through Aug. 29, 2011.  The chart shows
the Debtors have US$2,632,412 cash at July 29.  The Debtors expect
that to dwindle to US$840,319 by the end of one month, after costs
and expenses.

According to Credit Agricole, with almost US$19 million in
unsecured debt, over US$10 million of which is trade debt, the
Debtors gave no indication how the use of about US$1.7 million
will alleviate their circumstances.  The trade debt, Credit
Agricole explained, is important because the creditors likely have
maritime claims that could lead to the arrest or attachment of the
vessels by creditors not subject to the Bankruptcy Court's
jurisdiction.

Credit Agricole said the Debtors have not disclosed that on
June 28, Top Ships obtained a court order for the arrest of one
vessel in Savona Italy, putting Credit Agricole's security at
risk.

The Debtors said Credit Agricole will be adequately protected by
the Cash Collateral use through the granting of replacement
security interests and liens on the Debtors' assets, but excluding
causes of actions and all avoidance actions arising under chapter
5 of the Bankruptcy Code.

Royal Bank of Scotland, the agent for lenders with mortgages on
three other vessels to secure a US$117.7 million debt, will also
be granted replacement liens.

In its objection, Credit Agricole scoffed at the proposed adequate
protection. Credit Agricole said it is being offered "security
over assets on which it already has a security interest."

The Debtors are also asking the Court to enter a protective order
finding that certain unrestricted accounts are not subject to the
liens of the Debtors' Senior Lenders.  Futmarine, the Debtors' 50%
owned non-debtor affiliate, maintains two accounts with Credit
Agricole holding roughly US$4.874 million and US$20,012.82,
representing proceeds from the sale of unfinished hulls.  The
Debtors do not believe that the Unrestricted Credit Agricole
Accounts are subject to any liens or security interests of any of
the Credit Agricole Lenders.

The Debtors also maintain five accounts with RBS holding
US$1,099,193.  The Debtors believe that one of these accounts was
a cash intake account for a ship that had been pledged as
collateral under the RBS Credit Agreement but previously sold to a
third party.  Upon the sale of this vessel, the Debtors believe
that the account was similarly released from RBS's security
interests, if any.  The Debtors further believe that the remaining
Unrestricted RBS Accounts represent general commercial accounts
maintained by the Debtors with RBS and are not subject to any
pledges under the RBS Credit Agreement.

Credit Agricole is represented by:

          Alfred E. Yudes, Jr., Esq.
          Jane Freeberg Sarma, Esq.
          WATSON, FARLEY & WILLIAMS (NEW YORK) LLP
          133 Avenue of the Americas, 11th Floor
          New York, NY 10036
          Tel: 212-922-2200
          Fax: 212-922-1512
          E-mail: ayudes@wfw.com
                  jfreeberg@wfw.com

                     About Marco Polo Seatrade

Marco Polo Seatrade B.V. operates an international commercial
vessel management company that specializes in providing commercial
and technical vessel management services to third parties.
Founded in 2005, the Company mainly operates under the name of
Seaarland Shipping Management and maintains corporate headquarters
in Amsterdam, the Netherlands.  The primary assets consist of six
tankers that are regularly employed in international trade, and
call upon ports worldwide.

Marco Polo and three affiliated entities filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-13634) on July 29,
2011.  The other affiliates are Seaarland Shipping Management
B.V.; Magellano Marine C.V.; and Cargoship Maritime B.V.

Marco Polo is the sole owner of Seaarland, which in turn is the
sole owner of Cargoship, and also holds a 5% stake in Magellano.
The remaining 95% stake in Magellano is owned by Amsterdam-based
Poule B.V., while another Amsterdam company, Falm International
Holding B.V. is the sole owner of Marco Polo.  Falm and Poule
didn't file bankruptcy petitions.

Evan D. Flaschen, Esq., Robert G. Burns, Esq., and Andrew J.
Schoulder, Esq., at Bracewell & Giuliani LLP, serve as bankruptcy
counsel.  The cases are before Judge James M. Peck.

The petition said assets and debt are both more than US$100
million and less than US$500 million.


NIBC BANK: Fitch Affirms Hybrid Capital Rating at 'BB+'
-------------------------------------------------------
Fitch Ratings has affirmed Netherlands-based NIBC Bank N.V.'s
Long- and Short-term Issuer Default Ratings (IDRs) at 'BBB' and
'F3' respectively, its Viability Rating at 'bbb', Support Rating
at '5' and its Support Rating Floor at 'No Floor'. The Outlook on
the Long-term IDR remains Stable.

The ratings reflect the improvements NIBC has been able to achieve
in diversifying its funding sources as well as its prudent
liquidity and capital management. However, they also takes into
account the bank's continued vulnerability to negative economic
cycles deriving from its niche banking business model. Despite the
increased diversification, the bank still relies on the wholesale
markets for its funding, rendering it susceptible to investor
appetite. Operating profitability remains modest but has been
improving, with a higher proportion of higher quality, recurring
revenues.

At end 2010, NIBC reported a Fitch Core Tier 1 ratio of 11.74%, a
high level which the agency believes to be necessary to protect
the bank against adverse economic conditions. Furthermore, NIBC
maintains a large liquidity buffer above those required by the
Dutch regulator, which, again, Fitch believes to be needed to
allow it to withstand a temporary closure of the capital markets.

NIBC provides financing and advisory services to mid-caps and
institutional investors essentially in the Benelux countries and
Germany. It is also active in the Dutch and German residential
mortgage markets and operates in both countries through "NIBC
Direct", its on-line retail deposit brand. It is owned by a
shareholder consortium led by the private equity firm JC Flowers &
Co.

The rating actions are:

   -- Long-term IDR: affirmed at 'BBB'; Outlook Stable

   -- Short-term IDR: affirmed at 'F3'

   -- Viability Rating: affirmed at 'bbb'

   -- Individual Rating: affirmed at 'C/D'

   -- Support Rating: affirmed at '5'
   -- Support Rating Floor: affirmed at 'NF'

   -- State guaranteed debt: affirmed at 'AAA'

   -- Senior unsecured debt: affirmed at 'BBB'

   -- Subordinated debt: affirmed at 'BBB-'

   -- Hybrid capital: affirmed at 'BB+'

The rating action has no impact on NIBC's 'AAA'-rated mortgage
covered bonds.


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


DALRADIAN EUROPEAN: Moody's Lifts Rating on Class E Notes to Caa3
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Dalradian European CLO II B.V.

Issuer: Dalradian European CLO II B.V.

   -- EUR59.2M Class A2 Senior Secured Floating Rate Notes due
      2022, Upgraded to Aaa (sf); previously on Jun 22, 2011 Aa1
      (sf) Placed Under Review for Possible Upgrade

   -- EUR31.83M Class B Deferrable Secured Floating Rate Notes due
      2022, Upgraded to A1 (sf); previously on Jun 22, 2011 A2
      (sf) Placed Under Review for Possible Upgrade

   -- EUR23.81M Class C Deferrable Secured Floating Rate Notes due
      2022, Upgraded to Baa3 (sf); previously on Jun 22, 2011 Ba1
      (sf) Placed Under Review for Possible Upgrade

   -- EUR25.8M Class D Deferrable Secured Floating Rate Notes due
      2022, Upgraded to Ba3 (sf); previously on Jun 22, 2011 B3
      (sf) Placed Under Review for Possible Upgrade

   -- EUR15M Class E Deferrable Secured Floating Rate Notes due
      2022, Upgraded to Caa3 (sf); previously on Jun 22, 2011 Ca
      (sf) Placed Under Review for Possible Upgrade

   -- EUR6M (currently EUR4.7M outstanding Rated Balance) Class P
      Combination Notes due 2022, Upgraded to Baa3 (sf);
      previously on Jun 22, 2011 Ba2 (sf) Placed Under Review for
      Possible Upgrade

   -- EUR7M (currently EUR5.7M outstanding Rated Balance) Class W
      Combination Notes due 2022, Upgraded to Ba1 (sf); previously
      on Jun 22, 2011 Ba3 (sf) Placed Under Review for Possible
      Upgrade

Moody's also confirms the rating on the following notes:

   -- EUR4M (currently EUR3.0M outstanding Rated Balance) Class T
      Combination Notes due 2022, Confirmed at Ca (sf); previously
      on Jun 22, 2011 Ca (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 Class 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% 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 Classes P and T, 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

Dalradian European CLO II, issued in November 2006, is a multi
currency Collateralised Loan Obligation ("CLO") backed by a
portfolio of mostly high yield European senior secured loans. The
portfolio is managed by Elgin Capital LLP. This transaction will
be in reinvestment period until 07 December 2012.

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 modelling 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 modelling framework. Additional changes to the
modelling assumptions include (1) standardizing the modelling of
collateral amortization profile, (2) changing certain credit
estimate stresses aimed at addressing the lack of forward looking
indicators as well as time lags in receiving information required
for credit estimate updates and (3) adjustments to the equity
cash-flows haircuts applicable to combination notes.

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 EUR313.2 million,
defaulted par of EUR20.3 million, a weighted average default
probability of 31.49% (consistent with a WARF of 3149), a weighted
average recovery rate upon default of 46.16% and a diversity score
of 33. 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 90.4% 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
2015 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.

Sources of additional performance uncertainties are:

1) Moody's also notes that around 64% 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.

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 new
   issue loans or other loans with longer maturities and/or
   participate in amend-to-extend offerings. Moody's tested for a
   possible extension of the actual weighted average life in its
   analysis.

4) The deal has significant exposure to non-EUR denominated
   assets. Volatilities in foreign exchange rate will have a
   direct impact on interest and principal proceeds available to
   the transaction, which may affect the expected loss of rated
   tranches.

5) Other collateral quality metrics: The deal is allowed to
   reinvest and the manager has the ability to deteriorate the
   collateral quality metrics' existing cushions against the
   covenant levels. Moody's analyzed the impact of assuming lower
   of reported and covenanted values for weighted average rating
   factor, weighted average spread and diversity score.

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

Moody's modelled 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
modelled, 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.


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


LSR OJSC: Fitch Affirms 'B' Long-Term Foreign Currency IDR
----------------------------------------------------------
Fitch Ratings has affirmed OJSC LSR Group's (LSR) Long-term
foreign currency Issuer Default Rating (IDR) at 'B' with a Stable
Outlook and the senior unsecured rating of the existing bond
issues of RUR5.0 billion, RUR1.5 billion, RUR2.0 billion and
RUR2.0 billion at 'B'. The agency has also assigned the new bond
issue of RUR2.0 billion a senior unsecured rating of 'B'.

The affirmations reflect LSR's acceptable liquidity position and
its strong positions in the Russian development and building
materials markets. Fitch assesses positively the optimization of
the debt portfolio term structure, but considers LSR's investment
plans as ambitious.

LSR has reinforced its market positions following the financial
crisis. It is among the top Russian real estate developers, with a
focus on the St. Petersburg and Leningrad region. The development
and construction segment contributed 67% of revenues and almost
80% of EBITDA in 2010. LSR's real estate portfolio is significant
with a net sellable area of 8.4 sq. m with a market value of
US$3.7 billion as of December 31, 2010.

LSR is finalizing its vertical integration in north-western
Russia. The recently installed cement plant is already
commissioned. The plant is also expected to improve the building
materials segment performance.

LSR plans to strengthen its construction and development positions
in Moscow and Yekaterinburg via the expansion of its development
portfolio and a new cement plant project in Moscow region. Despite
these expansion activities, LSR's principal operations remain in
the Leningrad region where the company is building a new brick
plant.

The macroeconomic outlook for real estate development in Russia
has improved since the crisis, and this is confirmed by mortgage
statistics (2.5x increase of new mortgage loans in 2010 compared
with 2009). However, the recovery could slightly decelerate due to
worse than expected dynamics of real disposable income. The
positive outlook for building materials and aggregates is
supported by the expected intensification of infrastructure
construction in Russia.

LSR's H210 and Q111 sales improvements reflect the recovering
volumes and prices in all business segments. The EBITDA decrease
in 2010 (compared to 2009) was mostly due to the recognition of
low-margin residential real estate transferred under 2009
government contracts and by a certain time lag for building
materials price recovery. At the same time, the significant growth
(around 90%) in new private contract sales in real estate
development segment for H210 and Q111 (compared with the
respective previous year periods) should be considered a
reflection of future revenue growth.

Fitch expects moderate revenue growth in 2011-2012 and a sharp
revenue increase in 2013 and 2014 due to the increase in sales
proceeds under existing and new development projects. EBITDA
margin is expected to recover back to 24%-27% in 2013-2014. Free
cash flow is expected to be negative until 2013 due to significant
investments reflected in working capital. Net adjusted
debt/EBITDAR is expected to remain high (3.6x-3.8x) in 2011-2012
with some reduction to 2.0x in 2014.

Positive rating action could be driven by further market recovery
resulting in an EBITDA margin exceeding 25%, successful de-
leveraging with net adjusted debt /EBITDA sustainably below 2.0x-
2.5x level, or positive free cash flow for two consecutive years.
Negative rating action could be driven by a market deterioration
resulting in an EBITDA margin below 15%, increase in the issuer's
leverage not supported by corresponding CFO growth, or worsening
short-term liquidity position.

The Stable Outlook reflects Fitch's expectations that LSR will be
able to maintain its operational profile and acceptable liquidity
position.


MEGAFON OAO: Fitch Affirms Long-Term Currency IDRs at 'BB+'
-----------------------------------------------------------
Fitch Ratings has affirmed OAO MegaFon's Long-term foreign
currency and local currency Issuer Default Rating (IDR) at 'BB+'
and Short-term foreign currency IDR at 'B'. The agency has also
affirmed the National Long-term rating at 'AA(rus)' and foreign
and local currency senior unsecured rating at 'BB+'. The Outlooks
on the Long-term ratings are Positive.

The Positive Outlook reflects Fitch's expectation that MegaFon
shareholders will be able to put in place a sustainable financial
strategy for MegaFon. A final decision by the Russian courts in
June 2011 to forbid Altimo and TeliaSonera placing their equity
interests in MegaFon into a vehicle under joint control expands a
range of strategic options for shareholders. Fitch takes a view
that a shareholder impasse is likely to be ultimately resolved. A
lack of progress in that direction will likely lead to the rating
Outlook being revised to Stable.

MegaFon's financial and operating profile conforms to a higher
rating category than its current IDR of 'BB+'. The company has
been able to maintain and marginally improve its market share in
the Russian mobile market. Megafon has invested more than its
peers between 2009 and Q111 which ensured its leadership in the
fast-growing segment of data services. As smartphone proliferation
improves, data services quality and data network capacity becomes
a more pronounced competitive factor.

Fitch expects Megafon's financial performance to remain strong.
Although the overall margins are likely to come under moderate
pressure as a result of stronger mobile competition and wider
expansion into the low-margin handset retail business and to a
lesser extent into the fixed-line/broadband segment, the company
is likely to have potential for cost cutting that would help
maintain its profitability.

Capex spends are likely to fall as a percentage of revenues from
high levels of over 25% in 2007-2010 with positive implications
for free cash flow generation. While there is still significant
uncertainty over the distribution of Long Term Evolution (LTE)-
compatible frequencies in Russia, a decision by Megafon,
Vimpelcom, MTS and Rostelecom to use Skartel, a niche mobile
operator with LTE-ready frequencies, as a wholesale LTE network
provider will likely significantly reduce the individual capex
requirement of participating companies for the LTE roll-out.

Megafon has accumulated a significant net cash position on its
balance sheet, as a result the company does not face any material
currency or refinancing risks. A huge cash balance also provides
flexibility to undertake medium-sized acquisitions without
negative implications for the company's creditworthiness.

Megafon's corporate governance remains a key concern for Fitch --
capping it at below investment-grade territory. Fitch notes that a
shareholder dispute exposes the company to financial and non-
financial risks. As long as shareholders do not agree on the
strategic future for Megafon, there is a risk that they may decide
to use its cash flows for dividends, or lever the company with
debt in order to raise funds that would be applied to buy-out some
shareholders. Fitch also notes reports that some of Megafon's
current shareholders have used tactics such as no-show at board
meetings or abstaining from voting at AGMs of their investee
companies that hampered a normal auditor selection process and
greatly complicated normal flow of information -- these sort of
risks are not compatible with an investment grade rating.


MOBILE TELESYSTEMS: S&P Puts BB Corp. Credit Rating on Watch Neg.
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' long-term
corporate credit rating and related debt ratings on Russian
telecoms operator Mobile TeleSystems (OJSC) (MTS) on CreditWatch
with negative implications. "We also placed our ratings on
MTS' majority shareholder, Sistema, and its related debt ratings
on CreditWatch with negative implications," S&P said.

"The CreditWatch placement reflects our view that the risk of
payment default on US$400 million notes, issued by MTS' wholly-
owned subsidiary Mobile TeleSystems Finance S.A. (MTS Finance; not
rated) and guaranteed by MTS, remains significant. The notes are
due in January 2012," S&P related.

"We understand that MTS Finance has still not paid a US$210
million arbitral award due March 5, 2011. As a result of MTS'
failure to pay the award on behalf of its subsidiary, MTS is
effectively exposing noteholders to the risk of technical default
on the notes, in our opinion. We understand that MTS Finance is
currently able to make coupon payments on the notes. We believe,
however, that the bullet repayment of the notes in January 2012
might involve higher risks, potentially resulting, in a worst-case
scenario, in payment default. We do not believe that actions taken
by MTS over the past several months including a change in the bond
trustee -- have eliminated the risk of payment default under our
criteria. That said, we continue to believe that MTS as a
guarantor of the notes has the financial capacity and willingness
to fully repay the notes," S&P said.

"The placement of Sistema's 'BB' long-term corporate credit rating
on CreditWatch mirrors the rating action on MTS, as we continue to
view the credit quality and governance of these two companies as
closely correlated," S&P related.

"It is our view that Sistema, as MTS' majority shareholder, is
fully aware of the situation and did not exercise control over MTS
to avert MTS Finance's failure to pay the arbitral award.
Accordingly, we view corporate governance at both companies as
very aggressive and believe that the ratings on MTS and Sistema
should be strongly aligned," S&P said.

"From a stand-alone business perspective, we believe MTS' main
credit risks are associated with the company's own organic and
external growth plans, fierce competition in a saturated market,
and the risks commonly associated with operating in Russia," S&P
related.

"That said, we think the company's strong business and financial
characteristics, based on solid positions in the Russian and
Ukrainian mobile telephony markets, mitigate these risks. In our
opinion these characteristics include improving economies of
scale, sound operating profitability, strong cash flows, and
adequate liquidity," S&P said.

"We expect to resolve the CreditWatch placement on MTS and Sistema
within the next three months. If MTS does not proactively manage
this situation by the end of October, leaving bondholders at that
time with a still significant risk of payment default, we could
lower the rating by one or more notches," S&P related.

"We could affirm the rating at the current level if we believe
that MTS has eliminated or adequately reduced the risk of payment
default," S&P said.


TRANSTELECOM JSC: Fitch Affirms 'B+' Long-Term IDR; Outlook Neg.
----------------------------------------------------------------
Fitch Ratings has revised JSC Transtelecom Company's (TTK) Outlook
to Negative from Outlook Positive. The agency has also affirmed
the company's Long-term Issuer Default Rating (IDR) at 'B+',
Short-term IDR at 'B', Long-term local currency IDR at 'B+', and
downgraded its National Long-term rating to 'A-(rus)' with a
Negative Outlook. TTK's senior unsecured debt is affirmed at 'B+'
and domestic senior unsecured debt is downgraded to 'A-(rus)'.

The Outlook revision reflects the fact that TTK's core wholesale
business remains under pressure while its broadband strategy to
build a last mile extension to its backbone network and go into
retail broadband services entails significant execution risks and
is heavily capex intensive. Both factors will be contributing to
rapidly growing leverage on TTK's balance sheet. Unless rising
leverage is supported by strong positive financial contribution
from the retail broadband segment, TTK's ratings may come under
more pressure.

Transtelecom is a well-established alternative operator in the
domestic and international wholesale line-leasing, corporate voice
and data transmission services with a growing residential fixed-
broadband business. The core wholesale and voice
intercity/international business segments suffered in 2010 as
major Russian operators began to rely on their own backbone
network and prices in these segments have continued to fall.

Fitch expects TTK's market share in the wholesale segment will
show more stability in 2011 since all operators need a second
provider for back-up or on less busy routes. However, the segment
will still be under strong pricing pressure, so overall segment
revenue is expected to continue decreasing. The company's
corporate data transmission services (IP Access, IP VPN) are
expected to grow moderately thanks to an increasing corporate
customer base and stronger consumption of services per customer.
So far TTK has successfully grown its retail broadband subscriber
base in spite of significant delays with the last-mile network
roll-out. The company plans to develop this segment quickly,
starting this year and focusing on areas where competition is
currently low and it is possible to connect customers cost
efficiently. Broadband revenue should become the main driver of
TTK's revenue in 2011 but a margin of error for this strategy
within the current rating level is thin.

Fitch believes that the company can significantly reduce its cost
base which would have a positive impact on its EBITDA margins. The
new management team that has been running the company since mid-
2010, has progressed significantly in that direction. Fitch
understands that these initiatives are supported by TTK's
shareholder RZD, and there is evidence that RZD is willing to
provide indirect financial support for TTK through amended
intercompany agreements on the provision of certain core services
and lease payments. Fitch notes that RZD's shareholding is a
positive factor as the shareholder may be instrumental in helping
TTK with liquidity in case of need.

The fixed broadband retail market in Russia is consolidating,
competition is increasing with pronounced pricing pressures, so
the successful growth in this market depends critically on the
ability to quickly connect and serve customers, provide
competitive for high quality services. Although TTK has a quite
consistent and promising strategy for this market, Fitch believes
that there are high operational and execution risks that may lead
to revenue and EBITDA below expectations.


===========
T U R K E Y
===========


ALTERNATIFBANK: Fitch Affirms 'BB' Long-Term IDR; Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed Alternatifbank A.S.' (ABank) Long-term
Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. At the
same time, the agency has upgraded the bank's Viability Rating
(VR) to 'bb' from 'bb-', and lowered the Support Rating to '5'
from '3', reflecting a change in the way Fitch incorporates the
benefits of ABank's association with the broader Anadolu Group
into its ratings.

Operating conditions are likely to gradually become more difficult
for Turkey's second-tier banks as competition is fierce.
Nevertheless, Fitch believes that ABank is better positioned than
some of its peers thanks to its links with its owner, the Anadolu
Group, which is supportive of its growth plans. In addition to
providing customer introductions, Anadolu Group also contributes
to deposit stability at the bank.

The Anadolu Group is a leading Turkish conglomerate with interests
spanning a broad range of sectors, the most dominant of which are
beer and soft drinks. Group companies introduce customers to
ABank, providing it with access to a large number of SME suppliers
and distributors.

In line with its VR methodology, Fitch believes that Anadolu
Group's business introductions to, and deposits held at, ABank
should be viewed as an ongoing relationship between the two
parties, the benefits of which should be reflected in the bank's
VR. ABank's VR has been upgraded to reflect these benefits, and
the bank's IDRs and National Rating are now driven by the VR.

Fitch no longer factors potential support from Anadolu Group's
operating entities into the ratings of ABank, and as a result has
lowered ABank's Support Rating to '5' from '3'. This reflects the
fact that large stakes in the group's main operating entities are
held by outside shareholders, which in Fitch's view makes the
provision of direct capital or liquidity support to the bank by
these entities less reliable.

Fitch believes that the owners of Anadolu Group would have a high
propensity to provide support to ABank, in case of need. However,
their ability to do so is difficult to assess, and so this
potential support is not factored into ABank's ratings. The
Support Rating Floor of 'No Floor' reflects Fitch's view that
sovereign support also cannot be relied upon, as ABank occupies
only a modest position in Turkey's banking system.

ABank ranks 22nd out of 45 banks by assets in Turkey and controls
a low 0.4% deposit share. It intends to expand organically, with a
near-tripling of branches to 150 by end-2017. The recruitment of
relationship managers, who bring with them existing client
portfolios, is helping to ensure that new branches break even
within six months, but the downside is that around 20% of existing
SME customers are new to the bank. Tight cost control is also a
priority. An overhaul of IT systems, scheduled for completion by
end-2011, should help.

ABank is making efforts to combat margin pressure through
increased focus on the profitable smaller SME sector and the
retail sector. Housing loans, a booming market in Turkey, are the
main retail product, but contributions from retail banking are as
yet modest. ABank will find it difficult to significantly develop
this segment, given the dominance of the country's leading banks.

Loan quality indicators have traditionally been below peers',
reflecting ABank's SME focus. Impaired loans reached 4.6% of loans
at end-Q111 (peer average: 3.7%); this ratio was flattered by a
sale of partially reserved impaired loans in 2010.

Some deposit concentration is evident as the bank has a higher
proportion of SME customer deposits than peers. Nevertheless, 20%
of deposits are group-related and are stable. Efforts to lengthen
the funding maturity profile continue, and the international
capital markets, currently open to Turkish issuers, may be tapped,
pending favourable market conditions. Liquidity is supported by a
growing portfolio of Turkish government securities, readily repo-
able; loans are mainly short-term and reprice frequently.

Fitch considers ABank's capitalization to be merely adequate given
the challenges faced by the country's smaller banks. Shareholders
are supportive of growth. Retained earnings are built up through a
no dividend policy and indications are that Turkish banks may,
once again, provide interesting investment targets for
international banks, opening up the potential for shareholders to
attract a foreign partner.

An upgrade of the VR is unlikely in the short term due to pressure
on asset quality and capital. Downside is also currently limited
given Turkey's strong growth prospects and credit demand, combined
with management's prudent risk appetite.

The rating actions are:

   -- Long-term foreign currency and local currency Issuer Default
      Ratings (IDR): affirmed at 'BB' with Stable Outlook

   -- Short-term foreign currency and local currency IDRs:
      affirmed at 'B'

   -- Viability Rating: upgraded to 'bb' from 'bb-'

   -- Individual Rating: affirmed at 'D'

   -- Support Rating: lowered to '5' from '3'

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

   -- National Long-term rating: affirmed at 'AA(tur)', Outlook
      Stable


HABAS SINAI: Fitch Affirms Long-Terms Currency IDRs at 'B+'
-----------------------------------------------------------
Fitch Ratings has affirmed Habas Sinai ve Tibbi Gazlar Istihsal
Endustrisi A.S.'s (Long-term foreign currency Issuer Default
Rating (IDR) and its Long-term local currency IDR at 'B+'. The
company's National Long-term rating has been downgraded to 'A-
(tur)' in line with Fitch's National rating scale for Turkey. The
Outlooks on all ratings are Stable.

The ratings reflect the company's extremely conservative financial
policies which have seen the company maintain a net cash position
in recent years. Fitch's conservative rating case forecasts that
the company will be able to maintain a net cash position over the
next two-three years. Habas's ratings also reflect the company's
operational diversification with meaningful operations in steel
production, industrial gases, and merchant power generation. Fitch
recognizes the company's near monopoly position in the domestic
industrial gases market. While the steel division is by far the
largest in terms of revenue generation, the industrial gases and
energy segments have historically generated higher and more stable
EBIT.

Rating constraints include the company's low profitability margins
compared to other steel companies at the 'B+' rating level. The
lower margins (EBIT) of the steel business is partly explainable
by the company's method of production which uses the Electric Arc
Furnace (EAF) route which is in general lower margin than the
blast furnace route. Nonetheless, Habas' steel unit margins are
low compared to international peers which Fitch believes also
reflects the high proportion of commodity steel production and its
dependence on export sales. During 2010 the steel business was
only marginally profitable at the EBIT level, although year-to-
date results for 2011 (five months to May-2011) have recovered
towards normal levels. As a private company, disclosure levels for
Habas are weaker than for publicly listed companies and this also
represents a material limitation on the rating.

As noted, Habas' industrial gases and energy businesses have
historically been comparatively more stable than the steel
division. However, both segments had lower absolute profit levels
in 2010 due to a combination of lower market demand and more
competitive pricing. Whilst the industrial gases business appears
to be recovering in 2011, absolute profits from the energy
business remain below previous years (in part due to higher in-
house consumption of energy). As of FYE10, the company had total
debt of TRY535 million (US$345 million) of which short-term debt
was TRY470 million. Short-term debt primarily represents letters
of credit (for import and export financing) and is fully covered
by on-balance sheet cash. For 2011 and beyond Fitch expects Habas'
EBITDAR generation to return to historic levels. Free cash
generation is expected to remain positive.

The Stable Outlook reflects Fitch's opinion that Habas will
maintain a conservative financial approach including strong
liquidity, and that operating results will recover towards
historic levels. Negative rating pressure could result from funds
from operations (FFO) net leverage in excess of 1.0x, a
consolidated EBITDAR margin below 4%, or weaker than currently
expected results from the energy segment. The likelihood of a
positive rating, while limited by the company's weaker disclosure
levels, could result from an improvement in said disclosure levels
or from a significant strengthening of the company's operational
profile.


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


* CITY OF KYIV: Fitch Affirms Long-Term Currency Ratings at 'B-'
----------------------------------------------------------------
Fitch Ratings has revised the Ukrainian City of Kyiv's Long-term
ratings Outlook to Stable from Negative and affirmed the Long-term
foreign and local currency ratings at 'B-'. The agency has also
affirmed the city's National Long-term rating at 'BBB+(ukr)' and
Short-term foreign currency rating at 'B'. The rating action also
affects the city's outstanding debt issues of US$250 million,
US$250 million and US$300 million.

The Stable Outlook reflects the reduction of any immediate
refinancing risk due to the repayment of US$200 million of loan
participation notes (LPN) in July 2011 and the rebound of the
local economy. The agency expects an improvement in the city's
budgetary performance in 2011-2012 with the gradual improvement of
margins offsetting persistent short- term debt.

Fitch notes that any positive rating action is subject to an
improvement in the city's budgetary performance with operating
margin above 5% in 2011-2012 and containment of direct debt below
50% of current revenue. Conversely higher than expected
debt/direct risk or growing refinancing risk may trigger a
negative rating action.

Fitch expects an improvement of the city's budgetary performance
with the full-year operating margin at about 2%-3% in 2011. The
city's operating revenue increased by 6.1% yoy in 2010, after a
contraction in 2009. However, Kyiv's budget remains pressured by
rigid current transfers and staff salaries, which amounted to
86.9% of operating expenditure in 2010. The agency notes that the
city's status as Ukraine's capital, reinforced integration of its
administration as part of the executive branch of the state, and
reduced political uncertainty at the national level will continue
to support the ratings.

Kyiv's issue of US$300 million LPN in July 2011 effectively led to
a reduction of immediate refinancing risk on the matured US$200
million LPN. Kyiv's direct risk increased to UAH9.6 billion in
July 2011 from UAH8.8 billion at end-2010. The city's issued
external bonds (i.e. LPN) amounted to 67% of direct risk stock,
which also includes domestic loans and promissory notes. Fitch
expects Kyiv's direct risk to stabilize at about UAH10 billion by
end-2011.

Kyiv's viable and service-oriented economy expanded by 4.5% yoy in
2010, recovering well following the negative effects of financial
crisis. Fitch forecasts that the national economy's continued
growth at 4%-5% yoy in 2011-2012 will benefit the city's economic
performance as Kyiv is Ukraine's economic and financial centre,
which accounted for 18.6% of the country's GDP in 2009.


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


DAVIES ENFORCEMENT: Goes Into Liquidation
-----------------------------------------
TransportXtra reports that civil enforcement agency Davies
Enforcement has gone into liquidation. Insolvency practitioner
Findlay James was due to wind up the company and appoint a
liquidator on August 5.

The firm, says TransportXtra, collected parking debts for councils
including the London Boroughs of Southwark and Richmond, as well
as Thanet and Dover councils.  All four confirmed that they were
not owed any money by the bailiff firm, TransportXtra reports.

Davies Enforcement, based in Caterham, Surrey, was founded in 1998
and led by joint owners Karl and Elaine Smith.


EAST LANCASHIRE WAREHOUSING: Firm's Building Attracts Bidders
-------------------------------------------------------------
Sam Chadderton at Lancashire Telegraph reports that the home of a
former warehousing and distribution firm which went bust has
attracted a number of bids.

The old East Lancashire Warehousing building has only been
advertised for sale at GBP1.895 million by chartered surveyors and
property consultants Sanderson Weatherall, according to Lancashire
Telegraph.

An unnamed spokesman for the firm said they were 'close to putting
the site under offer' after receiving several bids in the last two
weeks, Lancashire Telegraph notes.

East Lancashire Warehousing laid off 60 staff in April when
administrators were brought in, the report recalls.  Lancashire
Telegraph relates that there was a failed company voluntary
arrangement and it collapsed owing GBP2.2million, including
GBP600,000 to staff.

Key contracts were lost amidst delivery problems caused by
freezing Weather, the report adds.


EMI GROUP: Gets Early Bids; Sale for US$4 Billion Likely
--------------------------------------------------------
Andrew Edgecliffe-Johnson and Helen Thomas at The Financial Times
report that bids for EMI Group suggest that the British music
company could fetch more than US$4 billion, allowing Citigroup to
recoup about three-quarters of the money it lent to Guy Hands'
ill-fated private equity buy-out in 2007.

According to the FT, people familiar with the matter suggested
that first round preliminary bids from more than 10 groups had
spanned a range from just over US$3 billion to closer to
US$4 billion.

The first-round bids, placed in the past few days, have raised
expectations that the US bank that seized EMI from Mr. Hands in
February could fetch more than the US$3.3 billion Warner Music,
its rival, was sold for this year, the FT says, citing several
people familiar with the auction.

Between four and six preliminary offers were for the whole
company, the people, as cited by the FT, said, with the rest split
between bidders wanting only the recorded music business behind
artists such as Coldplay and The Beatles, and others seeking just
EMI Music Publishing, which holds the rights to 1.3 million songs.

Citigroup, the FT says, is expected to go back to preliminary
bidders this week, beginning a process of due diligence that could
change their calculations on the valuations of EMI assets.
Bidders expect the bank to ask for ?second-round bids by the
middle of September, the FT discloses.

A sale for about US$4 billion would recoup three-quarters of the
GBP3.4 billion (US$5.5 billion) Citigroup lent Mr. Hands in 2007,
the FT recounts.  It wrote down the loans by GBP2.2 billion in
February, leaving EMI capitalized with GBP300 million of cash and
GBP1.2 billion of debt, the FT states.

EMI Group Ltd. -- http://www.emigroup.com/-- is the fourth
largest record company in terms of market share (behind Universal
Music Group, Sony Music Entertainment, and Warner Music Group).
It houses recorded music segment EMI Music and EMI Music
Publishing.  EMI Music distributes CDs, videos, and other formats
primarily through imprints and divisions such as Capitol Records
and Virgin, and sports a roster of artists such as The Beastie
Boys, Norah Jones, and Lenny Kravitz.  EMI Music Publishing, the
world's largest music publisher, handles the rights to more than a
million songs.  EMI Music operates through regional divisions (EMI
Music North America, International, and UK & Ireland).  Financial
services giant Citigroup owns EMI.


EXCLUSIVE ASSET: Publicly Reprimanded Over Controls Failing
------------------------------------------------------------
Introducer Today reports that the Financial Services Authority
(FSA) has publicly censured Exclusive Asset Management for systems
and controls failings, an inability to demonstrate the suitability
of its advice and failing to communicate with clients in a clear,
fair and not misleading way.

Exclusive went into voluntary liquidation on May 24, 2011.  Were
it not for that, the FSA would have imposed a financial penalty of
GBP60,000.

According to the report, the case is related to that of Gary John
Hexley who worked for Exclusive between January 2009 and May 2010
and was publicly censured and prohibited by the FSA on June 13,
2011, for giving customers unsuitable investment advice.

The failings at Exclusive were identified during an unannounced
FSA visit in April 2010 following complaints about Hexley, the
report notes.

"The fine we would have levied on Exclusive reflects the
seriousness of the failings found at the firm. Financial advisers
and providers alike must take notice of Exclusive's failings and
ensure they learn from them," Introducer Today quotes Tom Spender,
FSA head of retail enforcement, as saying.

"Firms operating in this industry must comply with the FSA's rules
and we will take robust action against firms and individuals who
fail to demonstrate the required standards."

Exclusive Asset Management is a Birmingham-based independent
financial adviser.


HOLIDAYS4U: Goes Into Administration, Cancels Flights
-----------------------------------------------------
Rosalba O'Brien at Reuters reports that United Kingdom holidays
firm Holidays4u has gone into administration during the peak
summer holiday season.  PriceWaterhouseCoopers has been appointed
as joint administrators for the company, according to Reuters.

"The company has suffered because of the difficulties faced by the
travel industry during 2010 and 2011 as a result of the economic
downturn.  The director has determined that the business is no
longer able to trade and placed the company into administration,"
Reuters quoted PriceWaterhouseCoopers as saying.

money.uk.msn.com reports that the Association of British Travel
Agents (ABTA) said 20,000 forward bookings will be cancelled as a
result of the collapse.

Administrators PricewaterhouseCoopers said the Civil Aviation
Authority (CAA) would be responsible for getting home those
already abroad as long as they had booked flights as part of a
package holiday, according to money.uk.msn.com.  These people are
covered by the CAA's Air Travel Organizer's Licensing Scheme
(Atol), money.uk.msn.com relates.

Meanwhile, Simon Petersen at legalweek.com relates that Bird &
Bird has been handed a lead role on the administration Holidays 4
UK.  PwC has turned to Bird & Bird for insolvency advice, with the
firm fielding a team led by joint international corporate
restructuring and insolvency head Brett Israel, according to
legalweek.com.

legalweek.com notes that most of Holidays4u's 18 staff have been
made redundant.

Reuters discloses that holiday sales in the UK have been hit hard
by squeezed incomes at a time of relative austerity, and
exacerbated by recent political unrest in the Middle East and
North Africa.

The Brighton-based Holidays4u, which traded under the names
Holidays 4U and Aegean Flights, sold packages and flights to
Turkey.


LLOYDS BANKING: Posts GBP2.3-Bil. Net Loss in First Half 2011
-------------------------------------------------------------
Gavin Finch and Howard Mustoe at Bloomberg News report that Lloyds
Banking Group Plc, Britain's biggest mortgage lender, reported a
first-half net loss after Irish bad loan provisions increased,
funding costs rose and the lender set aside GBP3.2 billion
(US$5.2 billion) for missold loan insurance.

According to Bloomberg, the London-based bank said in a statement
on Wednesday that the bank posted a GBP2.31 billion net loss for
the period compared with a profit of GBP596 million in the first
half of last year.

Lloyds, 41%-government owned, said its net interest margin, the
difference between what it earns on loans and its funding cost,
shrank to 2.07% from 2.12% in the same period of 2010, Bloomberg
notes.

"We've been seeing the effect on the margin of repaying the
relatively inexpensive government and central bank funding and
replacing that with more sustainable long-term funding for the
group," Bloomberg quotes Finance Director Tim Tookey as saying.

Lloyds's funding costs are rising as Chief Executive Officer
Antonio Horta-Osorio, 47, weans the bank off low-interest
government loans and onto costlier wholesale funding, Bloomberg
notes.  In June, the bank announced it was cutting 15,000 jobs to
help reduce costs by GBP1.5 billion, in addition to the 27,000
roles slashed since its acquisition of HBOS Plc in 2008, Bloomberg
recounts.

                  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.


MAURICE PAYNE: Creditors to Challenge Administration
----------------------------------------------------
Adam Hooker at PrintWeek reports that a group of creditors is set
to challenge the appointment of administrators at Maurice Payne
Colourprint.

Maurice Payne went into administration with Rimes and Co on
July 28, after a drawn-out closure that led to employees going
more than four months without pay, according to PrintWeek.
However, the report relates that a winding-up order has appeared
on the London Gazette, to be heard at 10:30 a.m., on August 22, at
Reading Crown Court.

PrintWeek says that the hearing has been officially brought by
Ideal Finishing, a creditor of the business that will be
represented by legal practice Douglas Wemyss Solicitors.  The
report notes that Ideal Finishing has been liaising on the
petition with print industry credit checking organization ICSM.

Rupert Rudd, director at ICSM, told PrintWeek in an interview that
there was little he could say at this stage because the case was
in the hands of the courts, but added that more information would
be available after the hearing.

"ICSM has several clients supporting the petition, who are
prepared to challenge the appointment," the report quoted Mr. Rudd
as saying.


NEWCASTLE BUILDING: Moody's Affirms 'D-' BFSR; Outlook Negative
---------------------------------------------------------------
Moody's Investors Service has announced rating and outlook changes
on the standalone bank financial strength ratings of six building
societies. Four have been upgraded (Nationwide Building Society,
Yorkshire Building Society, Principality Building Society,
Coventry Building Society) with corresponding changes made to
their subordinated debt and hybrid instrument ratings, which are
determined solely by their standalone financial strength ratings.
A further two have been affirmed but with the outlook revised to
stable from negative (Newcastle and Nottingham).

Corresponding changes have been made to the long term rating of
one society and the short-term ratings of two. The long-term debt
ratings for eight societies remain under review for possible
downgrade as part of Moody's ongoing review of systemic support
for UK banks, which Moody's expects to conclude in the second half
of September once the proposals of the UK's Independent Commission
on Banking are published.


RATINGS RATIONALE

- CHANGES TO STANDALONE BANK FINANCIAL STRENGTH RATINGS AND
  OUTLOOKS

The standalone ratings of Nationwide, Yorkshire, and Principality
have been upgraded by two notches. Coventry's standalone rating
has been upgraded by one notch. "The upgrade of four building
societies' BFSRs reflects their performance since the crisis and
Moody's expectations regarding their future performance. Moody's
assessment recognizes that the UK economy is slowly recovering and
that broader banking and regulatory reforms are gradually taking
shape", explains Marjan Riggi, a Moody's Vice President and Senior
Credit Officer.

Moody's says that the performance track record shown by
Nationwide, Yorkshire, Coventry and Principality during the last
two years -- and to a lesser extent by Newcastle and Nottingham as
indicated by the stabilization of their outlook -- has shown
gradual improvement combined with better underwriting standards,
which mitigated the downside risks over the past period. In
particular, the key rating drivers for the standalone BFSR
upgrades of the four affected societies were a combination of:

1. Better asset-quality performance relative to their peers and to
   Moody's scenario assumptions. In some cases, the improvements
   in asset quality were the result of better underwriting
   standards and improvements in risk management controls and
   culture.

2. Continued deleveraging through a reduction of risky assets
   (especially non-prime mortgages and commercial real estate
   exposures), which has improved the relevant building societies'
   overall risk positioning and the transparency of the risks
   those institutions face.

3. Stabilizing and supportive macro-economic factors -- such as
   moderating house price declines, stabilizing unemployment, and
   low interest rates -- which have helped to maintain asset
   quality and reduce some of the uncertainty regarding future
   asset performance.

In each case, corresponding changes have been made to the
societies' subordinated and hybrid instrument ratings (as
appropriate), which are determined solely by their standalone
financial strength ratings.

The negative outlooks for Newcastle (rated Baa2/P-2/D-/Ba3) and
Nottingham (rated A3/P-2/C-/Baa2) were changed to stable,
reflecting stabilization in their asset quality and recovery in
their core profitability.

- SENIOR DEBT AND BANK DEPOSIT RATINGS CONFIRMED FOR COVENTRY;
  OTHERS REMAIN ON REVIEW FOR DOWNGRADE

The long-term debt and deposit rating of Coventry has been
confirmed at A3 with a stable outlook. In Moody's view the society
is not likely to benefit from any systemic support going forward,
and the action reflects the change to the standalone rating. All
long-term ratings of building societies affected by the on-going
review of systemic support remain on review for downgrade pending
the completion of Moody's assessment of systemic support for UK
banks (see also the announcement: 'Moody's extends review for
selected UK financial institutions').

- SHORT TERM DEBT AND BANK DEPOSIT RATINGS CONFIRMED FOR
  NATIONWIDE AND YORKSHIRE

Following the upgrade of Nationwide's standalone rating to C/A3,
Moody's has confirmed the society's short-term debt and deposit
rating at Prime-1. The confirmation of Nationwide's short-term
rating reflects its strong retail funding base, underpinned by
some ongoing systemic support. The short term rating of Yorkshire
has been confirmed at Prime-2, fully underpinned by the bank's C-
/Baa2 standalone rating

- RATING ACTIONS

Nationwide Building Society

* Bank Financial Strength Rating has been upgraded to C from C-
  with a stable outlook. The standalone rating now maps to an A3
  on the long-term rating scale (previously mapping to a Baa2)

* The long-term debt and deposit ratings of Aa3 remain on review
  for possible downgrade.

* The Prime-1 rating has been confirmed.

* The subordinated debt rating has been upgraded by two notches to
  Baa1 from Baa3.

* The PIBS (hyb) rating of Ba2 has been upgraded by two notches to
  Baa3 from Ba2.

Yorkshire Building Society

* Bank Financial Strength rating has been upgraded to C- from D+
  with a stable outlook. The standalone rating now maps to Baa2 on
  the long-term rating scale (previously mapping to Ba1)

* The long-term debt and deposit ratings of Baa1 remain on review
  for possible downgrade.

* The Prime-2 rating has been confirmed.

* The subordinated debt rating has been upgraded by two notches
  from Ba2 to Baa3.

Coventry Building Society

* Bank Financial Strength rating has been upgraded to C from C-
  with a stable outlook. The standalone rating now maps to A3 on
  the long term rating scale (previously mapping to Baa1).

* The long-term debt and deposit rating of A3 has been confirmed
  with a stable outlook.

* The Prime-2 rating has been unaffected by the rating action.

* The subordinate debt rating has been upgraded by one notch to
  Baa1 from Baa2.

* The PIBS (hyb) rating of Ba1 has been upgraded by one notch to
  Baa3 from Ba1.

Principality Building Society

* Bank Financial Strength rating has been upgraded to D+ from D-
  with a stable outlook. The standalone rating now maps to Ba1 on
  the long term rating scale (previously mapping to Ba3).

* The long- and short term debt and deposit rating of Baa2/P-2
  remain on review for possible downgrade

* Subordinated debt rating has been upgraded by four notches to
  Ba2 from B3

* PIBS (hyb) rating has been upgraded by two notches to B1 from B3

Newcastle Building Society

* Bank Financial Strength rating has been affirmed at D- with a
  stable outlook. This maps to Ba3 on the long term rating scale
  as it was previously.

* The long- and short term debt and deposit rating of Baa2/P-2
  remain on review for possible downgrade.

Nottingham Building Society

* Bank Financial Strength rating has been affirmed at C- with a
  stable outlook. This maps to Baa2 on the long term rating scale
  as it was previously.

* The long-term debt and deposit rating of A3 remains on review
  for possible downgrade.

* The Prime-2 rating has been unaffected by the rating action

PREVIOUS RATING ACTION & METHODOLOGIES USED

The principal methodologies used in this rating were "Bank
Financial Strength Ratings: Global Methodology", published in
February 2007, and "Incorporation of Joint-Default Analysis into
Moody's Bank Ratings: A Refined Methodology", published in March
2007.

METHODOLOGIES USED

The principal methodologies used in this rating were Bank
Financial Strength Ratings: Global Methodology published in
February 2007, and Incorporation of Joint-Default Analysis into
Moody's Bank Ratings: A Refined Methodology published in March
2007. Please see the Credit Policy page on www.moodys.com for a
copy of these methodologies.


SCARISBRICK HOTEL: Britannia Buys Hotel Out of Administration
-------------------------------------------------------------
Tom Bristow at Liverpool Echo reports that Manchester-based
Britannia has acquired Scarisbrick Hotel in Southport out of
administration, saving about 100 jobs in the process.

But suppliers fear they could be left thousands of pounds out of
pocket, according to Liverpool Echo.

Liverpool Echo notes that Scarisbrick Hotel, which was on the
market for GBP3.25 million, is understood to have fetched its
asking price in a deal known as a pre-pack.  The report relates
that under a pre-pack, firms go into administration as part of an
arrangement to be bought.

Staff was told administration was the best option for the hotel
which would otherwise have gone into liquidation, according to
letter obtained by the news agency.

Liverpool Echo says that the hotel's debts, which stood at close
to GBP3 million in January last year, will now be dealt with by
administrators BDO.

Liverpool Echo says that local firms fear that they may lose out
as a result of the deal.

Fresh produce suppliers, Matthew Shutt, managing director of MA
Forshaw, which is owed GBP27,000, said: "It doesn't help at all.
It doesn't threaten the business but you only need a couple more
businesses to go."


SPIRIT ISSUER: S&P Cuts Ratings on Five Note Classes to 'BB-'
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'BB-(sf)' from 'BB+
(sf)' and removed from CreditWatch negative its credit ratings on
all Spirit Issuer PLC's notes. The outlook is negative.

The transaction is a corporate securitization backed by a
portfolio of both managed and tenanted public houses. Until mid
2011, Spirit was a division of Punch Taverns PLC, the former
parent company. Following its strategic review in early 2011,
Punch Taverns split from Spirit, which became part of a new
separate company, with the newly formed Spirit Group as parent
company. In doing so, the cash at the former parent company level
was split between Spirit Group and Punch Taverns, with GBP61
million cash and GBP42 million bonds going to Spirit Group. Also
following this strategic review, Spirit's new management decided
to either dispose of or convert tenanted pubs into managed pubs,
over an undefined timescale.

S&P's rating actions reflect:

    "Our expectation of limited excess free cash flow as
    amortization begins in 2014," S&P related.

    "Changes to our business risk profile on Spirit," S&P said.

    Uncertainty about how the Spirit Group's planned disposals of
    tenanted pubs will affect free cash flow, and how the proceeds
    from these sales will be used.

Although Spirit's reported revenue and EBITDA in the year to March
2011 have risen by 3.6% and about 17.2%, this increase was from a
low base and has required significant investment in capital
expenditure (capex).

"Taking into account the recent capex levels and required pension
contributions to the Spirit Group, we note that Spirit does not
currently generate sufficient operating cash flow to maintain debt
service without requiring additional cash or disposing of assets.
Although we believe that some of the current capex is expansionary
(and therefore unlikely to remain at the current level), we
believe it remains unclear if Spirit will have sufficient
operating cash flow to pay debt service without some form of
parental support when amortization begins in 2014," S&P related.

"The December 2010 revision of our business risk profile on Spirit
to 'weak' from 'fair' reflected our view of a weak profitability
performance, compared with other managed and tenanted pub company
peers: average EBITDA margins were 16.0% for managed and 45.7% for
tenanted pubs (see 'Ratings Placed On CreditWatch Negative In
Spirit Issuer's Pub Securitization After Business Risk Score
Revised,' published Dec. 16, 2010. In our opinion, this weakened
business risk profile is largely due to the material
underperformance of Spirit's estate in 2010 and 2009. While we
view investing in the estate through additional capex positively,
we would need to see a significant increase in these EBITDA
margins to consider returning the business risk
profile to 'fair'," S&P stated.

"Other factors leading to the revision of our business risk
profile on Spirit include rising value-added tax and beer duties,
lower government spending, and higher personal taxes, which are
likely to feed through into weaker consumer spending, lower beer
sales, and continuing downward pressure on rents. We also believe
that the new management's recent announcements on tenanted pub
disposals could potentially lead to reduced EBITDA and cash flow
coverage ratios both during and after planned capex spending. We
do, however, understand that the majority of the capex program is
not contracted and could be deferred, if required," S&P related.

"Although the parent company had been buying back its bonds in
2010, we do not consider the debt reduction to be enough to
compensate for the loss of cash flows and the increased stresses
we have applied as a result of the weakened business risk
profile," S&P said.

The negative outlook reflects the short-term challenges that
Spirit faces. "In our view, the combination of government spending
cuts, depressed consumer confidence, and recent tax/tariff
increases, will mean that both the tenanted and managed pub
sectors will continue to find it difficult to improve trading
to levels commensurate with a 'fair' business risk score. Going
forward, to maintain the current ratings on Spirit's notes, like-
for-like profits would have to stabilize in 2011, and the
transaction would have to maintain reasonable financial ratios
without parental support, to be in a position to make increased
debt service payments when amortization begins (see 'U.K. Pub
Industry Must Continue To Diversify As More Customers Entertain At
Home,' published June 29, 2011)," S&P said.

"Furthermore, the outlook placement reflects the fact that we are
still awaiting additional information on the planned conversion of
tenanted pubs into disposal proceeds or managed pubs. We will
continue to monitor the effect of the disposal program --
particularly how the sale of the pubs could affect the
transaction's cash flow-to-debt service profiles," S&P added.

Ratings List

Spirit Issuer PLC
GBP1.25 Billion Asset-Backed Fixed- and Floating-Rate Debenture
Bonds

Ratings Lowered and Removed From CreditWatch Negative; Outlook
Negative

Class                Rating
           To                        From

A1         BB- (sf)/Negative         BB+ (sf)/Watch Neg
A2         BB- (sf)/Negative         BB+ (sf)/Watch Neg
A3         BB- (sf)/Negative         BB+ (sf)/Watch Neg
A4         BB- (sf)/Negative         BB+ (sf)/Watch Neg
A5         BB- (sf)/Negative         BB+ (sf)/Watch Neg


WHITE TOWER: Fitch Affirms Rating on Class E Notes at 'Csf'
-----------------------------------------------------------
Fitch Ratings has affirmed the class E notes of White Tower 2006-3
plc, due 2012.

   -- GBP32.8m class E (XS0275774072) affirmed at 'Csf'; Recovery
      Rating RR6

On the July 2011 interest payment date (IPD), the class B, C and D
notes were redeemed in full while the class E notes were only
partly redeemed. The affirmation of the class E notes reflects
Fitch's continued expectation they will realize a loss. This
tranche will remain outstanding until further distributions have
been finalized and retentions for contingent liabilities and
certain other expenses can be released.

A class E noteholder meeting is scheduled for August 4, 2011. The
issuer believes that certain amendments should be made to the
transaction documents so that, amongst others, interest will cease
to accrue on the class E notes from the July IPD. Should this be
approved, there will be more funds available to distribute as
principal on the class E notes.

Fitch will provide further comment after the noteholder meeting.


WILLIAM BALL: Goes Into Liquidation After CVA Fails
---------------------------------------------------
Builders Merchants Journal reports that William Ball has ceased
trading.

All members of staff were dismissed on Aug. 2 when the company
closed up, Builders Merchants Journal says, citing kbbreview.

The liquidator acting on behalf of William Ball is Debbie
Cockerton of KSA Business Recovery and Insolvency Services, in
Southend-on-Sea, Builders Merchants Journal discloses.

The company implemented a Company Voluntary Arrangement (CVA) in
June, however this could not maintain the company once one of its
biggest customers withdrew support because of what was described
as a "flawed" business plan, Builders Merchants Journal recounts.
Accounts covering the year ending March 31, 2009 showed that
William Ball had a pre-tax loss of GB{1.45 million, Builders
Merchants Journal notes.

William Ball is a kitchen and bedroom furniture manufacturer.


* UK: 8% of Retailers Likely to Enter Administration in 12 Months
------------------------------------------------------------------
Rachael Singh at Accountancy Age reports that trade body R3
reports that nearly one in ten retailers believes they will enter
an insolvency process in the next year.

The insolvency body found 8% of retailers are convinced they are
likely to enter administration in the next 12 months, compared to
an industry average of 2%, Accountancy Age says.

Accountancy Age notes that just 24% of respondents from retail and
22% from wholesale, said they had not experienced any signs of
distress in the last year.  Unsurprising as almost 60% said
profits had decreased since 2010 compared to an average of 34%
across all sectors.

According to the report, R3 members have reported the highest
increase in insolvency cases in this sector, including high
profile closures such as Habitat, Focus DIY, Jane Norman and
parent company of Moben Kitchens Homeform.

"The pressure on retailers is two-fold. As consumers have less
money to spend, stores are discounting their prices to get people
through their doors; this is at a time when inflation and rising
commodity prices have increased retailers costs," Accountancy Age
quotes President of R3 Frances Coulson as saying.

"Unfortunately this year, cash-strapped consumers are likely to
hold off until the Christmas sales before making significant
purchases thus putting further strain on retailers."

More than 500 business-owners and finance directors from small
medium and large organizations were surveyed, Accountancy Age
says.


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


* EUROPE: EU Commission Urges States to Upgrade Rescue Fund
-----------------------------------------------------------
James G. Neuger at Bloomberg News reports that European Commission
President Jose Barroso called the bond-market slump in Italy and
Spain "clearly unwarranted" and urged governments rapidly to
complete the upgrade of the euro-area rescue fund.

Mr. Barroso voiced "deep concern" about the bond plunge, and
blamed sagging investor confidence on the perception that European
leaders haven't come up with a "systemic" answer to the crisis
that started in Greece last year, Bloomberg relates.

The euro area showed its determination to act at last month's
emergency summit and called on governments to complete national
approval of the strengthened rescue fund "without
delay," Bloomberg quotes Mr. Barroso as saying in an e-mailed
statement in Brussels on Wednesday.


* Trouble in Europe Beckons U.S. Corporate Restructuring Experts
----------------------------------------------------------------
Dow Jones' DBR Small Cap report that Bankruptcy work may have
slowed for restructuring firms in the U.S., but London is calling.
And so is Paris, Frankfurt and Reykjavik.


* BOOK REVIEW: Fraudulent Conveyances
-------------------------------------
Author: Orlando F. Bump
Publisher: Beard Books, Washington, D.C. 2000 (reprint of book
first published in 1872 by Orlando F. Bump). 657 pages.
Price: $34.95 trade paper, ISBN 1-893122-78-6.

The book is a legal classic for adding American law on fraudulent
conveyances up to the 1870s when it first appeared to English law
going back much further; which in turn grew out of Roman law.
Bump's first chapter on the history of such law will be of
interest to readers looking for this perspective; though the large
bulk of the content is a meticulous, lawyerly organization and
expounding of the many facets of the law on fraudulent conveyances
as this has formed over centuries.

As Bump notes, this area of law has a larger number of "opposing
authorities . . . than can be found in any other branch of the
law." In order to keep the treatment as simple as possible while
still being true to its many facets and opposing authorities and
relevant to legal practice of readers for whom it is intended, the
author takes fraudulent conveyances as a part of common law. "This
work simply considers the subject as it was at common law with the
remedies afforded by the common law." Bump's treatment thus does
not go into criminal law or law with reference to statutes. Though
statutes regarding fraudulent conveyances have been passed in each
state, these statutes have basically copied Elizabethan Anglo-
Saxon law and have "always been considered as merely declaratory
of the common law." Since there is thus no wide or radical
difference between common law and state statutes concerning
fraudulent conveyance, nearly all of Bump's work bears as well on
law associated with the statutes. He brings this up in the work's
Preface so readers will understand the framework by which he
treats the subject. In the regular text, Bump does not take up
state fraudulent conveyance statutes except where ones vary from
the common law "to warn the practitioner [reader] that the text is
not applicable to his particular State." The author does not
however discuss grounds for this variance between a state's
statutes and common law.

Bump begins the voluminous study with definitions at the
foundation of fraudulent conveyance. Fraudulent conveyances are
all transfers made "to the end, purpose, and intent to delay,
hinder, or defraud creditors." Whether a conveyance to a creditor
is fraudulent is determined by the three "points" (as the author
calls them) of intent, the consideration, and the bona fides of
the transfer. Consideration generally refers to the right of the
debtor to use certain property or other assets to settle a debt.
Bona fide means that the debtor was not given the property, loan,
etc., fraudulently by the creditor.

From the basics of the definitions, Bump moves on to the many
facets of this area of law dealing with circumstances in all types
of human relationships. Not only business dealings, but
transactions establishing a debtor-creditor relationship between
members of a family, neighbors, governments, and just about any
two legally recognized parties are covered by the law of
fraudulent conveyances. Subsequent creditors, ambiguous contracts,
and determining the value of property to pay debts are all factors
bringing complications to such law which Bump systematically takes
up.

Though the book was written in the mid latter 1800s, since the
basics of the law of fraudulent conveyances have not changed much
since then--or from when such law was formulated for that matter--
Bump's work remains relevant and educating for anyone from lawyers
to businesspersons to lay persons interested in the topic. A
detailed index running close to 50 pages takes readers to specific
topics of this involved legal subject.


                            *********

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
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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,
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                 * * * End of Transmission * * *