TCREUR_Public/110914.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

         Wednesday, September 14, 2011, Vol. 12, No. 182

                            Headlines



C Z E C H   R E P U B L I C

SAZKA AS: Administrator Receives "More Than Two" Takeover Bids


G E R M A N Y

MUENCHENER HYPOTHEKENBANK: Moody's Downgrades BFSR to 'D+'
PROVIDE GEMS: Moody's Cuts Rating on EUR38MM C Notes to 'Ca'


G R E E C E

* GREECE: "Orderly Insolvency" Needed to Stabilize Euro


I R E L A N D

ANGLO IRISH: Apthorp Files Suit Over Condominium Loan
DECO 17: S&P Affirms Rating on Class G Notes at 'D'
EUROCREDIT CDO: Moody's Upgrades Rating on Class E Notes to 'Ba3'
MORRISON HOTEL: Receivers Sell Hotel for EUR25 Million
QUINN GROUP: International Creditors Not Hurt by Debt Writedowns

SILENUS LTD: S&P Lowers Rating on Class G Notes to 'D (sf)'


L U X E M B O U R G

GATEWAY IV: Moody's Upgrades Rating on Class D Notes to 'Ba2'


N E T H E R L A N D S

ARES EURO: Moody's Upgrades Rating on Class E Notes to 'Ba3'


R U S S I A

NAFTOGAZ NJSC: May Be Affected by Nord Stream Pipeline Negatively
RUSHYRDO JSC: Fitch Affirms Issuer Default Ratings at 'BB+'


S P A I N

AYT CAIXA: Fitch Affirms Rating on Class D Notes at 'Bsf'
SANTANDER EMPRESAS: Moody's Assigns 'Ca' Rating to EUR1.2MM Notes
SERIE BANCO: Fitch Upgrades Rating on Class D Notes From 'BB-sf'
SERIE CAJA: Fitch Affirms Rating on Class D Notes at 'Bsf'


S W E D E N

SAAB: Sells Technology to Secure Funds As Unions Seek Bankruptcy


U N I T E D   K I N G D O M

BEETHAM HOTELS: Administrators Sell Assets to Blue Manchester
BRITISH MIDLAND: First-Half Losses May Prompt Sale
CHOICES CARE: Charities Welcome Move to Seek New Bidders
COMET: Pension Liabilities May Hamper Auction Process
GEORGE STREET: Goes Into Liquidation

HEALTHCARE LOCUMS: Shareholders Approve Refinancing Plan
HMV PLC: Sales Slide 19%, But Says Christmas Plans on Track
* UK: Bank Reform Proposal Gets Widespread Support


                            *********


===========================
C Z E C H   R E P U B L I C
===========================


SAZKA AS: Administrator Receives "More Than Two" Takeover Bids
--------------------------------------------------------------
Lenka Ponikelska at Bloomberg News, citing Mlada Fronta Dnes,
reports that Sazka AS administrator Josef Cupka received "more
than two" bids for the company.

Czech financial groups PPF AS and KKCG said earlier they filed a
joint offer for Sazka, Bloomberg notes.

According to Bloomberg, the newspaper reported that Synot AS, a
Czech online lottery provider, also made a bid for Sazka.

As reported by the Troubled Company Reporter-Europe on Aug. 24,
2011, Bloomberg News related that the Prague Municipal Court,
which placed Sazka in bankruptcy in May, approved the terms for
the company's tender proposed by its administrator and the
creditors' committee.  The terms include a CZK500 million
(US$29.35 million) deposit from each bidder before doing due
diligence on the company, Bloomberg disclosed.  The price offered
by bidders will be the main criterion for choosing the new owner,
Bloomberg noted.  The administrator, as cited by Bloomberg, said
that the rules of the tender also include a fine of
CZK1.5 billion if the winner fails to get an approval of anti-
monopoly bodies to take over Sazka.

Sazka AS is a provider of lotteries and sport betting games in
the Czech Republic.


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


MUENCHENER HYPOTHEKENBANK: Moody's Downgrades BFSR to 'D+'
----------------------------------------------------------
Moody's Investors Service has downgraded Muenchener
Hypothekenbank eG's bank financial strength rating (BFSR) to D+
from C- (now mapping to Ba1 on the long-term rating scale from
Baa2 previously). The downgrade of the BFSR triggered the
downgrade of the senior debt and deposit ratings to A2 from A1.

Moody's has also affirmed MuenchenerHyp's Prime-1 short-term
rating and downgraded the Tier 1 instruments issued by GFW
Capital GmbH and Isar Capital Funding I Limited Partnership to
Baa3 (hyb) from Baa2 (hyb). The outlook on all the ratings is
stable, from negative previously.

Ratings Rationale

The downgrade of the BFSR was driven by several considerations,
including (i) the bank's persistently weak profitability and
internal capital generation, which leaves limited room for
unexpected losses; combined with (ii) the bank's only adequate
capitalization in the context of its risk profile and its low
quality of capital, which represents a challenge with regards to
the upcoming Basel III requirements.

Furthermore, the bank remains exposed to ongoing asset-quality
pressures at the current level from non-core portfolios such as
international commercial real estate, as well as selected
exposures within the bank's financial institutions and sovereign
portfolio. Moody's believes that the challenges that
MuenchenerHyp faces are more consistent with a BFSR of D+,
corresponding to Ba1 on the long-term rating scale.

In Moody's view, MuenchenerHyp's weak risk-adjusted profitability
represents a major rating constraint, leaving little room for
unexpected losses. Combined with the possibility that weaker
forms of capital might have to be replaced, the owners may have
to take further capital measures. At the end of 2010, the bank's
Tier 1 ratio stood at 6.4% and its core capital at EUR763
million, which included a sizable portion of hybrid Tier 1
capital instruments (EUR341 million) according to audited 2010
financial statements. On a positive note, Moody's anticipates
that MuenchenerHyp is expected to qualify for substantial capital
relief under the internal ratings-based approach, which is
expected to result in a higher Tier 1 ratio going forward.

The stable outlook on the D+ BFSR is underpinned by
MuenchenerHyp's conservative risk profile in its core residential
real-estate and domestic public-finance activities. Furthermore,
it reflects Moody's expectation that MuenchenerHyp will continue
to improve its relative risk position through the reduction of
its discontinued US commercial real-estate business, which was a
key driver for higher problem loans. The stable outlook
incorporates Moody's assumption that the bank will be able to
manage the EUR1.5 billion total disclosed exposures related to
sovereigns and banks in countries that are currently subject to
credit deterioration.

The one notch downgrade of the long-term debt and deposit ratings
to A2 follows the downgrade of the BFSR and incorporates Moody's
view that MuenchenerHyp will continue to benefit from the
existing support mechanism available to members of the group of
co-operative banks in Germany (the Bundesverband der Deutschen
Volksbanken und Raiffeisenbanken, BVR). Moreover, Moody's
anticipates that the German cooperative sector -- and thereby
indirectly MuenchenerHyp -- would continue to benefit from a high
probability of systemic support. Hence, MuenchenerHyp's A2 long-
term ratings with a stable outlook now benefit from a five notch
rating uplift from four previously.

HYBRID RATINGS DOWNGRADED TO Baa3 (hyb); OUTLOOK STABLE

As per Moody's methodology for hybrid ratings, the assigned
ratings for the capital notes and the fixed-rate capital
securities issued by GFW Capital and Isar Capital Funding I are
three notches below the A3 adjusted standalone credit strength,
which reflects the D+ BFSR and incorporates four notches of co-
operative support.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward pressure on MuenchenerHyp's standalone rating could result
from (i) an improved quantity and quality of capital; (ii) rising
and sustained profitability without compromising underwriting
standards or risk appetite; and (iii) overall lower asset-quality
pressures, in particular a shrinking of its portfolio of non-
performing loans. A BFSR of D+, mapping into a higher Baa3 on the
long-term scale, would not result in upward pressure on the long-
term ratings.

Moody's would consider a downgrade of the BFSR if MuenchenerHyp
(i) experienced a further deterioration in non-performing loans;
or (ii) suffered credit deterioration in its securities
portfolio. The BFSR could be lowered if the bank faces
difficulties in converting its existing Tier 1 instruments into
stronger forms of capital. A lower BFSR could exert strong
downward pressure on the long-term ratings.

PREVIOUS RATING ACTIONS AND PRINCIPAL METHODOLOGIES

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

Headquartered in Munich, Germany, Muenchener Hypothekenbank eG
reported total assets of EUR35.4 billion and net income of EUR4.8
million as of the end of June 2011.


PROVIDE GEMS: Moody's Cuts Rating on EUR38MM C Notes to 'Ca'
------------------------------------------------------------
Moody's Investors Service has downgraded these classes of notes
issued by Provide Gems 2002-1 plc, a synthetic German RMBS
transaction. The rating actions reflect the worse-than-expected
collateral performance and conclude the review for downgrade
initiated by Moody's on April 13, 2011:

Issuer: PROVIDE GEMS 2002-1 PLC

   -- EUR32MM A Notes, Downgraded to Aa2 (sf); previously on
      Apr 13, 2011 Aa1 (sf) Placed Under Review for Possible
      Downgrade

   -- EUR46MM B Notes, Downgraded to Baa2 (sf); previously on
      Apr 13, 2011 A2 (sf) Placed Under Review for Possible
      Downgrade

   -- EUR38MM C Notes, Downgraded to Ca (sf); previously on
      Apr 13, 2011 B1 (sf) Placed Under Review for Possible
      Downgrade

   -- EUR29MM D Notes, Downgraded to C (sf); previously on
      Apr 13, 2011 Ca (sf) Placed Under Review for Possible
      Downgrade

Ratings Rationale

The rating action concludes the review for downgrade initiated by
Moody's on April 13, 2011 and takes into consideration the worse-
than-expected performance of the collateral.

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

Portfolio Expected Loss:

The collateral performance has been worse than anticipated as of
the last rating action in April 2008. Since then more than EUR22
million of mainly credit-impaired loans have been worked-out or
removed from the pool. However, the total amount of outstanding
credit events has remained relatively stable, as other loans have
migrated over the same period into higher delinquency buckets and
have constituted credit events. Moody's expects the total amount
of credit events (currently outstanding, plus future credit
events) to approximate EUR60 million. Since the transaction
closed in 2002, EUR32.8 million of credit events were eligible
for loss allocation, while EUR43.9 million of loans have been
removed from the pool without respective losses being allocated
to the transaction. Moody's expects further removals to take
place over the remaining term of the transaction, potentially
reducing the actual amount of credit events eligible for loss
allocation.

Moody's has reassessed its lifetime loss expectation, taking into
account: (i) the level of outstanding credit events reported as
of August 2011, totalling EUR 54 million (23.5% of current pool
balance, up from 9.9% in April 2008); and (ii) the increase in
observed loss severity to 92%, up from 85% in April 2008. Taking
into account the current amount of realized losses and completing
a roll-rate and severity analysis of the portfolio as well as
giving benefit for future removals, Moody's has increased the
portfolio expected loss assumption to 7.5% of the original pool
balance, from the previous level of 5.47%.

MILAN Aaa CE

Moody's has also re-assessed loan-by-loan information to
determine the MILAN Aaa CE. As a result, Moody's has increased
its MILAN Aaa CE assumptions to 50%, up from the previous level
of 26.4% in April 2009. This increase is mainly due to higher
delinquency levels for a relative smaller outstanding portfolio
compared with the latest review. As of August 2011, the pool
factor was 22.2%. Available credit enhancement under the class A+
notes is currently 64.8%.

Provide Gems 2002-1 is a transaction originated by Rheinhyp
Rheinische Hypothekenbank AG under which the credit risk of
approximately 28,310 residential mortgage loans was transferred
to investors. Under the terms of this transaction the credit
risks securitized relate only to the portion of the individual
loans that exceed the equivalent of 60% loan-to-appraised-value.
At closing, the total portfolio was EUR1,052 million.

The realized loss definition includes principal, accrued interest
(capped at 4%) and external enforcement costs. Losses will be
allocated in reverse sequential order. The portfolio is static
and the credit-linked notes amortize sequentially, starting with
the class A+ notes, which rank pro rata with the senior credit
default swap. The ratings address the ultimate payment of
principal on or before the final legal maturity of the notes.

METHODOLOGIES

The methodologies used in this rating were Principal Methodology
Moody's Approach to Rating RMBS in Europe, Middle East and
Africa, published in October 2009.

Other methodologies were Moody's Updated MILAN Methodology for
Rating German RMBS published in October 2009 and Revising
Default/Loss Assumptions Over the Life of an ABS/RMBS Transaction
published in December 2008.

Other factors used in this rating are described in "Global
Structured Finance Operational Risk Guidelines: Moody's Approach
to Analyzing Performance Disruption Risk" published in June 2011.


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


* GREECE: "Orderly Insolvency" Needed to Stabilize Euro
-------------------------------------------------------
Andreas Cremer at Bloomberg News, citing Die Welt, reports that
an "orderly insolvency" for Greece must not be ruled out for the
sake of stabilizing the euro.

"To stabilize the euro, there must be no taboos," the newspaper
quoted German Economy Minister Philipp Roesler as saying.  "If
need be, that also includes an orderly insolvency of Greece,
provided the instruments needed for that are available."

According to Bloomberg News' Peter Laca, Hospodarske Noviny
citing Slovak Finance Minister Ivan Miklos, reported that the
euro area's member states should have an option to declare
bankruptcy and restructure their debt if they become insolvent.

Bloomberg notes that Mr. Miklos, as cited by the newspaper, said
in an interview that he rejected ideas of a fiscal union and
issuance of joint euro-area bonds as solutions to the debt
crisis.

Meanwhile, Maud van Gaal at Bloomberg News, citing et Financieele
Dagblad, reports that Rabobank Groep Chief Financial Officer Bert
Bruggink said a Greek insolvency is a matter of time.

"The question is no longer whether Greece will go bankrupt," he
was cited as saying in an interview.  "The only question left is
when."

Hendrik Jan Eijpe, a spokesman for the Utrecht-based lender,
confirmed the comments, Bloomberg notes.


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


ANGLO IRISH: Apthorp Files Suit Over Condominium Loan
-----------------------------------------------------
Bloomberg News reports that Anglo Irish Bank Corp. was sued over
the sale of a loan tied to the condominium conversion of the
Apthorp building on Manhattan's Upper West Side.

According to Bloomberg, Apthorp Associates LLC said in a lawsuit
filed on Tuesday in New York state court in Manhattan that Anglo
Irish, which is selling a US$9.7 billion portfolio of U.S. real
estate loans, must maintain a 51% interest in the US$385 million
loan.  Apthorp is the sponsor of the condo conversion of the
building, Bloomberg says, citing the complaint.

"Apthorp's express contractual right to have a single majority
lender on the project throughout the term of the loan will be
lost absent prompt injunctive relief, thereby causing it
irreparable harm," Apthorp, as cited by Bloomberg, said.

The case is Apthorp Associates LLC v. Anglo Irish Bank Corp.
Ltd., 652492-2011, New York State Supreme Court (Manhattan).

                     Irish Nationwide Merger

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.


DECO 17: S&P Affirms Rating on Class G Notes at 'D'
---------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
DECO 17 - Pan Europe 7 Ltd.'s class B to F notes. "At the same
time, we affirmed our ratings on all other classes of notes
in this transaction," S&P related.

"The rating actions follow our review of the loan portfolio and
our assessment of likely principal losses from the loans in
different rating scenarios," S&P related.

DECO 17 closed in December 2007 and initially comprised 12 loans.
One of the loans (5% of the day 1 loan portfolio balance) has
prepaid. The transaction is granular and the largest loan (the
LWB loan) accounts for only 19% of the pool balance. The majority
of the loans (75% of the balance) mature in 2014, six years
before the notes mature in 2020.

"All loans are current and we understand the issuer does not
require liquidity drawings at the moment. Two loans however --
Elbblick and Rockpoint -- are in breach of a covenant, which both
trigger a cash trap, where the servicer retains excess rental
income that would otherwise be released to the borrower," S&P
said.

                  The LWB Loan (18.8% of the Pool)

The largest loan in the pool is the LWB loan, accounting for
18.8% of the pool balance. It is a fixed-rate loan with a seven-
year term, maturing in April 2014. The loan is interest- only,
but has amortized by about 8% from asset sales.

The loan sponsor is Leipziger Wohnungs-und Baugesellschaft mbH
(LWB), an entity 100% owned by the city of Leipzig in Germany.
LWB owns and manages about 15% of Leipzig's housing stock,
although only a portion of this secures the loan. The loan is
secured by about 1,000 properties, with about 11,500 residential
(97%) and commercial units in Leipzig.

"The portfolio vacancy rate has remained stable at around 6.5%
since closing, and the average rent per square meter has
increased by 7% over the same period. We consider this to be an
average amount when compared with other multifamily loans that we
monitor, and in line with inflation," S&P said.

"The market vacancy rate in Leipzig is approximately 12%-15%, but
a large portion of the vacant stock is obsolete and therefore
doesn't compete against LWB's portfolio, in our view. Leipzig's
population is just over 500,000 and the city forecasts it to
remain static over the next 10 years. Coupled with a projected
decrease in household size (more single person households) and a
low pipeline for new construction in this sector, this may likely
lead to an improved market occupancy rate in Leipzig in the
future," S&P stated.

Overall, the net operating income (NOI) from the portfolio is
down 4% but at the same time, the debt has reduced by 8%, which
means the yield on debt has increased.

"We believe that the positive cash flow performance has only
partially offset the developments in the residential real estate
market since the transaction closed. The value of the portfolio,
adjusting for sales, is likely to be lower than it was at
closing, but we believe a new valuation of the portfolio would
result in a loan to value (LTV) ratio that would still be below
60%. Therefore, we consider that the loan is highly likely to
repay in full," S&P said.

               The Rockpoint Loan (8.6% of the Pool)

This is the fourth largest loan in the pool, with a current
balance of EUR98.2 million and a maturity date of April 2012. The
reported interest coverage ratio (ICR) is 1.14x. The loan
structure features a full cash sweep (meaning that all excess
cash after interest payments is used to repay the loan), but the
remaining term is short and the borrower -- with the servicer's
Permission -- has used all excess funds (about EUR750,000 per
year) for capital expenditure in the past year.

The loan is secured by 34 predominantly retail properties located
across Germany. The portfolio size is about 79,000 square meters,
of which 98 tenants with a weighted-average lease term (WALT) of
5.4 years currently occupy 94.4% (97.6% on day 1).

On day 1, 25% of the rental income was scheduled to expire prior
to loan maturity. This has now reduced to 4.3% of the current
rent and 3.7% of the day 1 income, indicating that the sponsors
have been successful in reletting the vacant space. The largest
tenants are now EDEKA (36.4%), Praktiker (11.8%), Media Markt
(Metro Group; 'BBB', 6.1%) and REWE Group ('BBB-', 4.4%).

"Net operating income (NOI) has reduced by 24% since day 1, but
according to information provided to us by the servicer, this is
mainly due to the 68% increase in non-recoverable expenses. The
increased costs may be accounted for by higher expenses
associated with the re-letting of vacant units," S&P stated.

"Although these costs may reduce in the future, we believe that
the value of the portfolio is now below the value that the
servicer uses to calculate the LTV ratio (reported as 86.3%) and
the actual LTV is likely to be above 100%, in our view. As a
consequence, we believe the loan will likely default at its
maturity date in 2012 and the recoveries from a potential sale of
the assets will likely be insufficient to repay the loan in
full," S&P related.

                  The Elbblick Loan (6.3% of the Pool)

This is a comparably small loan, accounting for only 6.3% of the
pool, but it shows the highest reported LTV ratio in the pool at
110%. The loan is in breach of the whole loan ICR covenant (1.1x,
the ratio is 0.92x) and in breach of a covenant triggered by the
reduced NOI (by more than 10%). Both breaches trigger a cash
trap. The loan also briefly breached the senior loan ICR test at
1.2x, which triggered an event of default. The servicer, however,
decided not to call the default and the ratio is now at the
covenant level.

The senior loan has a balance of EUR145 million, of which the
issuer owns a 50% portion, ranking pari passu with the other 50%,
owned by a third party. There is also junior debt and the loan
matures in April 2013.

A portfolio of 58 retail properties located across Germany
secures the loan (56.1% of gross income from former eastern
Germany). "Since closing, the servicer has sold three of these
properties. We consider all of the properties -- built between
1990 and 2004 -- to be in good condition," S&P said.

"On day 1, 46% of the rental income was scheduled to expire
during the loan term. This number has now reduced, given the
expired leases. By area, 15% has leases expiring by loan maturity
and 16.5% is vacant, which shows that the borrower had limited
success in re-letting the space," S&P related.

In June 2011 the servicer received an updated valuation. The new
value (calculated in October 2010) is EUR131.15 million -- a 30%
market value decline (MVD) on day 1. The updated valuation
immediately caused a control valuation event to occur under the
intercreditor agreement, meaning that the junior lenders have
lost the majority of their rights.

Deutsche Bank AG is the controlling class representative,
operating advisor, and special servicer, having terminated the
appointment of Hatfield Philips as initial special servicer.

"We believe the loan will likely default when it matures in April
2013 or earlier if the cash flow from the properties further
reduces. Moreover, the recoveries from a potential sale of the
property portfolio will likely be insufficient to repay the
senior loan in full. Principal losses, together with enforcement
costs, will however likely be contained within the class G notes,
currently rated at 'D (sf)'," S&P stated.

                          Other Loans

Of the eight loans not described, the current property value of
two -- Mansford and Gabriel -- is likely lower than the
outstanding debt balance. "Also, the borrowers may fail to repay
these loans in full according to our calculations. All other
loans have LTV ratios (based on our assessment) between 80% and
100%, except for the AFI loan and the NILEG loan, where we
believe the LTV is likely lower than 80%," S&P related.

"Our expectations of principal losses on the notes have increased
and we believe that the combined losses from the loan portfolio
may ultimately affect the class F notes as well, which is why we
have lowered our rating on that class to 'B- (sf)' from 'BB-
(sf)'," S&P stated.

"We also believe that the increased losses will decrease the
credit enhancement available to the more senior classes of notes.
We have therefore also lowered our ratings on the class B to E
notes by one or two notches," S&P said.

"We have affirmed our ratings on the class A1 and A2 notes
because we believe that in a 'A (sf)' stress scenario, the loan
recoveries will be sufficient to repay these classes in full. We
lowered these ratings to 'A (sf)' from 'AAA (sf)' in April 2011
as a result of the application of our 2010 counterparty criteria.
The ratings in the transaction are now constrained to the issuer
credit rating on Danske Bank A/S (A/Negative/A-1), the liquidity
facility provider," S&P related.

"We previously lowered our rating to 'D (sf)' on the class G
notes because of a note interest shortfall that is unrelated to
the performance of the loans. We believe the issuer will be
unlikely to repay this shortfall (see 'Rating Lowered To 'D (sf)'
On CMBS Transaction DECO 17's Class G Notes; Rest Unaffected,'
published on May 27, 2011)," S&P said.

DECO 17 is a commercial mortgage-backed securities (CMBS)
transaction arranged by Deutsche Bank, currently comprising 11
loans. The majority of the remaining loans mature in 2014 (75% by
loan pool balance), while the legal final maturity date of the
notes is in 2020.

Ratings List

DECO 17 - Pan Europe 7 Ltd.
EUR1.249 Billion Commercial Mortgage-Backed Floating-Rate Notes

Class                  Rating
            To                       From

Ratings Lowered

B           A- (sf)                  A (sf)
C           BBB- (sf)                BBB+ (sf)
D           BB- (sf)                 BB+ (sf)
E           B+ (sf)                  BB (sf)
F           B- (sf)                  BB- (sf)

Ratings Affirmed

A1          A (sf)
A2          A (sf)
G           D (sf)


EUROCREDIT CDO: Moody's Upgrades Rating on Class E Notes to 'Ba3'
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Eurocredit CDO VII PLC:

   -- EUR221.5MM Class A Senior Secured Floating Rate Notes due
      2023, Upgraded to Aaa (sf); previously on Jun 22, 2011 Aa1
      (sf) Placed Under Review for Possible Upgrade

   -- EUR38.3MM Class B Senior Secured Deferrable Floating Rate
      Notes due 2023, Upgraded to Aa3 (sf); previously on Jun 22,
      2011 A2 (sf) Placed Under Review for Possible Upgrade

   -- EUR31.2MM Class C Senior Secured Deferrable Floating Rate
      Notes due 2023, Upgraded to Baa1 (sf); previously on
      Jun 22, 2011 Ba1 (sf) Placed Under Review for Possible
      Upgrade

   -- EUR29.1MM Class D Senior Secured Deferrable Floating Rate
      Notes due 2023, Upgraded to Ba1 (sf); previously on Jun 22,
      2011 B2 (sf) Placed Under Review for Possible Upgrade

   -- EUR19.8MM Class E Senior Secured Deferrable Floating Rate
      Notes due 2023, Upgraded to Ba3 (sf); previously on Jun 22,
      2011 Caa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR4MM Class P Combination Notes due 2023, Upgraded to Aa3
      (sf); previously on Jun 22, 2011 Baa1 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR8MM Class Q Combination Notes due 2023, Upgraded to Ba2
      (sf); previously on Jun 22, 2011 B3 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR15MM Class R Combination Notes due 2023, Upgraded to
      Baa3 (sf); previously on Jun 22, 2011 Ba2 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR6MM Class S Combination Notes due 2023, Upgraded to Aa3
      (sf); previously on Jun 22, 2011 Baa1 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR125MM Revolving Loan Facility Notes, Upgraded to Aaa
      (sf); previously on Jun 22, 2011 Aa1 (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 R,
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 1.5% per annum respectively, accrued on the Rated
Balance on the preceding payment date minus the aggregate of all
payments made from the Issue Date to such date, either through
interest or principal payments. For Classes P, Q and S, 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

Eurocredit CDO VII PLC, issued in April 2007, is a multi-currency
Collateralised Loan Obligation ("CLO") backed by a portfolio of
mostly high yield European loans. The portfolio is managed by
Intermediate Capital Managers Limited. This transaction will be
in reinvestment period until 05 April 2013. It is predominantly
composed of senior secured loans.

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

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

Reported WARF has increased from 2666 to 2909 between January
2011 and July 2011. However, this reported WARF overstates the
actual deterioration in credit quality because of the technical
transition related to rating factors of European corporate credit
estimates, as announced in the press release published by Moody's
on September 1, 2010. Additionally, defaulted securities total
about EUR2,96 million of the underlying portfolio compared to
EUR7,86 million in January 2011.

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 EUR471 million,
defaulted par of EUR2.96 million, a weighted average default
probability of 23.54% (consistent with a WARF of 2942), a
weighted average recovery rate upon default of 43.94% for a Aaa
liability target rating, a diversity score of 41 and a weighted
average spread of 2.88%. 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 84.9% 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. CLO
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 68% of the collateral pool
   consists of debt obligations whose credit quality has been
   assessed through Moody's credit estimates.

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) 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, weighted average coupon, and
   diversity score. However, as part of the base case, Moody's
   considered spread and coupon levels higher than the covenant
   levels due to the large difference between the reported and
   covenant levels.

5) Foreign currency exposure: 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.

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

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


MORRISON HOTEL: Receivers Sell Hotel for EUR25 Million
------------------------------------------------------
Donal Buckley at Irish Independent reports that the Morrison
Hotel in Dublin City centre is being offered for sale by the
receivers at FGS with a EUR25 million guide price.

Key factors behind the strong price include the hotel's
profitability as well as its city-centre location and status as a
four-star freehold premises, according to Irish Independent.

Irish Independent notes that the receiver Aiden Murphy, Horwath
Bastow Charleton has hired Westpro to continue to manage the
hotel.  While not indicating an asking price, it is believed that
the hotel could fetch EUR2.5 million, the report relates.

Morrison Hotel is a 42-bedroom four-star hotel located on the
Tullow to Castledermot Road, 5 kms from Carlow town.  The hotel
has a conference, wedding and banqueting business and its leisure
centre includes a 16m pool, Jacuzzi and a steam room.


QUINN GROUP: International Creditors Not Hurt by Debt Writedowns
----------------------------------------------------------------
Finbarr Flynn at Bloomberg News reports that Sean Quinn, the
founder and former head of Quinn Group, said international banks
and bondholders suffered no writedowns "whatsoever" on debt owed
by the company.

"The reality is that the debt has simply been re-assigned to
various Quinn Group companies," Bloomberg quotes Mr. Quinn as
saying in an e-mailed statement on Monday.  According to
Bloomberg, Mr. Quinn said that a deal agreed to by nationalized
Anglo Irish Bank Corp., which appointed a share receiver to the
firm in April, resulted in interest payments rising.

Finance Minister Michael Noonan on April 14 said that Mr. Quinn
and his family no longer have any role in the management,
operations or ownership of the Quinn Group, Bloomberg recounts.

The Quinn Group -- http://www.quinn-group.com/-- is a business
group headquartered in Derrylin, County Fermanagh, Northern
Ireland.  The privately owned group has ventured into cement and
concrete products, container glass, general insurance, radiators,
plastics, hotels and real estate.


SILENUS LTD: S&P Lowers Rating on Class G Notes to 'D (sf)'
-----------------------------------------------------------
Standard & Poor's lowered its credit ratings on Silenus (European
Loan Conduit No. 25) Ltd.'s class F and G notes to 'CCC- (sf)'
and 'D (sf)'.

"The rating actions follow the issuer's failure to pay interest
in full on the note interest payment date (IPD) in August 2011,
and the transfer of six loans in the pool to special servicing,"
S&P said.

"In this transaction, we understand that the liquidity facility
arrangements do not allow the issuer to make a drawing to cover
fees due to the special servicer. Excess cash -- the difference
between the issuer's income from loan interest and the issuer's
expenses for senior costs and note interest payments -- is also
not available to absorb these costs. Excess cash is instead
paid to the class X notes," S&P stated.

"The increased costs have, on the August 2011 note IPD, led to a
shortfall in the interest payment on the class G notes. We
believe that the issuer will likely also be unable to pay
interest in full on the class F notes on the following note IPD.
Moreover, we also believe that the shortfalls will continue to
accrue for the foreseeable future, and at least until all
currently specially serviced loans have been worked out. We have
therefore lowered to 'D (sf)' from 'CCC (sf)' our rating on the
class G notes and lowered to 'CCC- (sf)' from 'B+ (sf)' our
rating on the class F notes," S&P related.

Since early May 2011, of the 14 loans in the pool, the special
servicer took over six, which account for 29.2% of the loan pool.
The reported special servicing fees were EUR31,400, of which
EUR18,730 reduced the class G interest amount. "We believe that
the special servicing fees will increase because the loans have
not been in special servicing for an entire interest period and
the special servicing fees have therefore not been charged for a
full period," S&P related.

"According to our calculations, quarterly special servicing fees
could amount to approximately EUR100,000, compared with the most
recent interest burden of EUR54,239 for the class G notes. The
balance would reduce the amounts available for the payment of
interest on the class F note. The combined class F and G interest
burden was approximately EUR141,000 on the most recent IPD
(August 2011)," S&P stated.

"We note that the special servicer reports that the Cuxhaven and
Wolfsburg loans' borrowers have provided letters from financial
institutions willing to refinance the loans. These two loans may
therefore be removed from special servicing shortly.
Nevertheless, the quarterly special servicing fees would only
reduce to EUR76,300, which would still reduce the interest
payments made on both the class F and G notes on the next IPD,"
S&P continued.

Silenus (European Loan Conduit No. 25) is a true sale commercial
mortgage-backed securities (CMBS) transaction backed by 14 loans
(down from 17 at closing), secured against 179 mostly office and
retail properties in Italy, Germany, and France. The transaction
closed on March 22, 2007.

Ratings List

Silenus (European Loan Conduit No. 25) Ltd.
EUR1.246 Billion Commercial Mortgage-Backed Variable- and
Floating-Rate Notes

Class                  Rating
            To                       From

Ratings Lowered

F           CCC- (sf)                B+ (sf)
G           D (sf)                   CCC (sf)

Ratings Unaffected

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


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


GATEWAY IV: Moody's Upgrades Rating on Class D Notes to 'Ba2'
-------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Gateway IV - Euro CLO S.A.:

Issuer: Gateway IV - Euro CLO S.A.

   -- EUR54MM Class A2 Floating Rate Notes due 2023, Upgraded to
      Aa1 (sf); previously on Jun 22, 2011 Aa3 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR22MM Class B Floating Rate Deferrable Notes due 2023,
      Upgraded to Aa3 (sf); previously on Jun 22, 2011 Baa1 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR34MM Class C Floating Rate Deferrable Notes due 2023,
      Upgraded to Baa2 (sf); previously on Jun 22, 2011 Ba2 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR20MM Class D Floating Rate Derrable Notes due 2023,
      Upgraded to Ba2 (sf); previously on Jun 22, 2011 Caa1 (sf)
      Placed Under Review for Possible Upgrade

   -- EUR14MM Class E Floating Rate Deferrable Notes due 2023,
      Upgraded to B1 (sf); previously on Jun 22, 2011 Ca (sf)
      Placed Under Review for Possible Upgrade

   -- EUR6MM (current rated balance EUR4.5M), Class R Combination
      Notes, Upgraded to Baa1 (sf); previously on Jun 22, 2011
      Ba3 (sf) Placed Under Review for Possible Upgrade

   -- EUR8MM (current rated balance EUR6.4M), Class W Combination
      Notes, Upgraded to B1 (sf); previously on Jun 22, 2011 B3
      (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 Class R, which does 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

Gateway IV - Euro CLO S.A., issued in March 2007, is a single-
currency Collateralised Loan Obligation ("CLO") backed by a
portfolio of mostly high yield European and US loans. The
portfolio is managed by Pramerica Investment Management Inc. This
transaction will be in reinvestment period until April 25, 2013.
It is predominantly composed of senior secured loans.

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011. The actions also reflect
consideration of an increase in the transaction's
overcollateralization ratios and/or deleveraging of the senior
notes since the rating action in December 2009.

The actions reflect key changes to the modeling assumptions,
which incorporate (1) a removal of the temporary 30% default
probability macro stress implemented in February 2009, (2)
increased BET liability stress factors as well as (3) change to a
fixed recovery rate modeling framework. Additional changes to the
modeling assumptions include (1) standardizing the modeling of
collateral amortization profile, and (2) adjustments to the
equity cash-flows haircuts applicable to combination notes.

The overcollateralization ratios of the rated notes have improved
since the rating action in December 2009. The Class A, Class B,
Class C, Class D and Class E overcollateralization ratios are
reported at 142.0%, 130.6%, 116.2%, 108.5%, and 103.5%,
respectively, versus October 2009 levels of 133.0%, 122.8%,
109.9%, 103.3%, and 99.1%, respectively. Overcollateralization
tests of all classes were failing in October 2009 while as of
August 2011 only Class E overcollateralization test is still
failing. In particular, the Class E overcollateralization ratio
is expected to increase due to the diversion of excess interest
to deleverage the Class E notes in the event of a Class E
overcollateralization test failure. Moody's also notes that the
Class D and Class E Notes are deferring interest of EUR 1.8
million and 2.0 million, respectively.

Reported WARF has increased from 2,797 to 3,199 between October
2009 and August 2011.

However, this reported WARF overstates the actual deterioration
in credit quality 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. Additionally, defaulted securities total about
EUR11.5 million of the underlying portfolio compared to EUR34.7
million in October 2009.

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 366.3
million, defaulted par of EUR 13.4 million, a weighted average
default probability of 25.8% (consistent with a WARF of 3,151), a
weighted average recovery rate upon default of 43.5% for a Aaa
liability target rating, a diversity score of 44 and a weighted
average spread of 3.01%. 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 83.7% 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 2) the large
concentration of speculative-grade debt maturing between 2012 and
2015 which may create challenges for issuers to refinance. CLO
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 notes that around 67% of the collateral pool consists
   of debt obligations whose credit quality has been assessed
   through Moody's credit estimates.

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) 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. However, as part of the base case, Moody's
   considered spread and coupon levels consistent with the
   midpoint between reported and covenanted values due to the
   large difference between the reported and covenant levels.

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

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

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

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


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


ARES EURO: Moody's Upgrades Rating on Class E Notes to 'Ba3'
------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Ares Euro CLO I

Issuer: Ares Euro CLO I

   -- EUR37.8MM Class A-2 Senior Secured Floating Rate Notes due
      2024, Upgraded to Aaa (sf); previously on Jun 22, 2011 Aa3
      (sf) Placed Under Review for Possible Upgrade

   -- EUR52MM Class A-3 Senior Secured Floating Rate Notes due
      2024, Upgraded to Aaa (sf); previously on Jun 22, 2011 Aa1
      (sf) Placed Under Review for Possible Upgrade

   -- EUR8MM Class B-1 Senior Secured Deferrable Floating Rate
      Notes due 2024, Upgraded to Aa2 (sf); previously on Jun 22,
      2011 Baa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR13MM Class B-2 Senior Secured Deferrable Fixed Rate
      Notes due 2024, Upgraded to Aa2 (sf); previously on Jun 22,
      2011 Baa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR19MM Class C Senior Secured Deferrable Floating Rate
      Notes due 2024, Upgraded to A2 (sf); previously on Jun 22,
      2011 Ba1 (sf) Placed Under Review for Possible Upgrade

   -- EUR26MM Class D Senior Secured Deferrable Floating Rate
      Notes due 2024, Upgraded to Baa3 (sf); previously on
      Jun 22, 2011 B3 (sf) Placed Under Review for Possible
      Upgrade

   -- EUR13.5MM Class E Senior Secured Deferrable Floating Rate
      Notes due 2024, Upgraded to Ba3 (sf); previously on Jun 22,
      2011 Caa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR6MM Class F Senior Secured Deferrable Floating Rate
      Notes due 2024, Upgraded to B1 (sf); previously on Jun 22,
      2011 Caa3 (sf) Placed Under Review for Possible Upgrade

   -- EUR8MM (with current outstanding rated balance amount of
      EUR6.3M) Class Q Combination Notes due 2024, Upgraded to
      Baa1 (sf); previously on Jun 22, 2011 Ba1 (sf) Placed Under
      Review for Possible Upgrade

The rating of the Combination Note addresses the repayment of the
Rated Balance on or before the legal final maturity. For Class Q,
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

Ares Euro CLO I, issued in April 2007, is a single currency
Collateralised Loan Obligation ("CLO") backed by a portfolio of
mostly high yield European loans. The portfolio is managed by
Ares Management Limited. This transaction will be in reinvestment
period until May 15, 2014. The current portfolio is predominantly
composed of senior secured loans.

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011. The actions also reflect
consideration of credit improvement of the underlying portfolio
and an increase in the transaction's overcollateralization ratios
since the rating action in December 2009.

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.

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.

The overcollateralization ratios of the rated notes have improved
since the rating action in December 2009. The Class A, Class B,
Class C, Class D, Class E and Class overcollateralization ratios
are reported at 141.31%, 129.98%, 121.20%, 110.93%, 106.26% and
104.31%, respectively, versus October 2009 (where the December
2009 rating action was based on) levels of 139.21%, 128.05,
119.39, 109.28%, 104.68%, 102.79%, respectively. All related
overcollateralization tests are currently in compliance.

Improvement in the credit quality is observed through a stronger
average credit rating of the portfolio (as measured by the
weighted average rating factor "WARF") and a decrease in the
proportion of securities from issuers rated Caa1 and below. In
particular, as of the latest trustee report dated July 2011, the
WARF is currently 2682 compared to 2697 in the October 2009
report, and securities rated Caa or lower make up approximately
7.5% of the underlying portfolio versus 9.4% in October 2009.
However, the reported WARF understates the actual improvement in
credit quality 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.

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 EUR340.16
million, defaulted par of EUR 789,908, a weighted average default
probability of 18.81% (consistent with a WARF of 2728), a
weighted average recovery rate upon default of 45.40% for a Aaa
liability target rating, a diversity score of 35 and a weighted
average spread of 3.05%. The default probability is derived from
the credit quality of the collateral pool and Moody's expectation
of the remaining life of the collateral pool. The average
recovery rate to be realized on future defaults is based
primarily on the seniority of the assets in the collateral pool.
For a Aaa liability target rating, Moody's assumed that 88% 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. CLO
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 53% 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) 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, weighted average coupon, and
   diversity score.

The principal methodology used in the 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
===========


NAFTOGAZ NJSC: May Be Affected by Nord Stream Pipeline Negatively
-----------------------------------------------------------------
Fitch Ratings says that the commissioning of the first line of
the Nord Stream gas pipeline has already been factored into
ratings.  However, the agency considers that the new gas pipeline
has consequences for the financial and operational profiles of
some issuers.  The magnitude and direction of the impact varies
on a company-specific basis.

OAO Gazprom (Gazprom, 'BBB'/Positive) is expected to benefit from
the additional diversification of gas transportation routes to
western Europe beyond the current pipelines running through
Ukraine (and then across Slovakia) and through Belarus (and then
via Poland).  The cost of Nord Stream is expected to be around
EUR7.4 billion, funded through project finance and with a limited
impact on Gazprom's credit metrics.

The new gas pipeline is likely to have negative consequences for
Slovensky Plynarensky Priemysel, a.s. (SPP, 'A'/Negative) and
NJSC Naftogaz of Ukraine (Naftogaz, 'CCC').  Fitch expects the
gas transmission volumes and revenues of these issuers will
decrease by about 20% from 2012, negatively impacting their
financial profiles.  The existing gas pipelines running through
Ukraine and Slovakia so far carried about two-thirds of Russian
gas delivered to western Europe.

The agency notes that long-term transit volume through this
corridor is less predictable due to uncertain gas demand growth,
plans to open the second section of the Nord Stream pipeline for
commercial deliveries by 2013 (and possibly other pipelines such
as Nabucco or South Stream), but also considering existing ship-
or-pay contracts between Gazprom and SPP, and Naftogaz.  Gas
demand dynamics are also uncertain due to the glacial economic
growth outlook for much of Europe, despite the withdrawal from
nuclear power generation by some countries (Germany, Switzerland,
Italy).

Fitch also notes that in the light of the ongoing gas price and
volume talks between Naftogaz and Gazprom, new disruptions to the
supply of gas similar to those experienced in 2006 and 2009
cannot be fully ruled out.  Securing an alternative gas export
route to western Europe may strengthen Gazprom's negotiating
power with Naftogaz.  This increased event risk is also largely
factored into Naftogaz and SPP's current ratings.

For Naftogaz, the current uncertainty extends to restructuring
plans to be considered by the government in Q411.  Fitch rates
Naftogaz's US$1,595 million notes at 'B', in line with the
sovereign rating, based on the unconditional and irrevocable
guarantee from the government of Ukraine.  The agency does not
expect Naftogaz's potential restructuring to have an impact on
the guarantee.

Fitch considers the Nord Stream pipeline should improve the
security of supply for most western European gas consumers.
Although it does not offer diversification of gas sources away
from Gazprom, the route diversification is positive.

The effect is more complex for countries such as Poland, Czech
Republic, Slovakia, Hungary, Romania or Bulgaria.  However, this
region has embarked upon an improvement of interconnection
capacities to foster liberalization and security of supply (for
example Hungary's new connections with Romania, Croatia, and
prospectively Slovakia, Poland's new connection with Czech
Republic and its plans for an LNG import terminal).

Nonetheless, end users are likely to eventually face increased
transmission and distribution tariffs to post-fund the capital
expenditure currently born by the respective network companies.
Independent gas suppliers (and customers in markets that are
fully liberalized) are expected to benefit from the increased
nominal supply capacity.

Fitch also notes that increased competition, the economic
slowdown and a mismatch between the import price for gas (from
Gazprom) and wholesale gas prices has put pressure on the
profitability of incumbent gas suppliers such as E.ON AG (E.ON,
'A'/Stable), RWE AG ('A'/Negative), GDF Suez SA (GDF), ENI Spa
('A+'/Stable), PGNiG SA, SPP, OMV AG ('A-'/Stable), and Naftogaz,
a trend likely to persist in the short to mid term.

Nord Stream is a gas pipeline from Vyborg in Russia to Greifswald
in Germany through the Baltic Sea with a total planned capacity
of 55 billion cubic metres (bcm).  The first line of the pipeline
(27.5 bcm) is expected to start commercial deliveries in Q411.
The second line, which would double Nord Stream's capacity, is
planned to be commissioned in late 2012.  Nord Stream is
constructed by Nord Stream AG, a joint-venture owned by Gazprom,
BASF SE ('A+'/Stable)/Wintershall Holding GmbH, E.ON Ruhrgas AG
(a subsidiary of E.ON), Gasunie and GDF.


RUSHYRDO JSC: Fitch Affirms Issuer Default Ratings at 'BB+'
-----------------------------------------------------------
Fitch Ratings has affirmed JSC RusHydro's Long-term foreign and
local currency Issuer Default Ratings (IDR) at 'BB+' with a
Positive Outlook.  The agency has also affirmed the National
Long-term Rating at 'AA(rus)' with a Positive Outlook and the
foreign currency senior unsecured rating at 'BB+'.

RusHydro's ratings continue to be driven by the explicit support
from the Russian Federation ('BBB'/Positive/'F3'), its majority
shareholder, and reflect their strong operational and strategic
ties, in accordance with Fitch's 'Parent and Subsidiary Rating
Linkage' methodology dated August 12, 2011.  The agency
anticipates that the Russian Federation will maintain a
controlling stake in RusHydro over the medium term following a
partial privatization scheduled for 2012.  The agency assesses
RusHydro's standalone creditworthiness in the mid 'BB' rating
category.

Since January 1, 2011, the majority of power generation companies
and consumers in Russia buy and sell electricity and capacity at
market prices, subject to certain price caps, while households
and certain other customers buy electricity and capacity at
regulated tariffs.  Russian electricity markets remain under
regulatory scrutiny.  In 2011, Russian authorities have publicly
stated their concerns about rising electricity costs, committed
to limit power price increases to end consumers to about 15% per
annum and imposed, among other measures, capacity price caps.
RusHydro has generally benefited from the market liberalization
over the past few years and posted generation revenue growth from
RUB63.7 billion in 2008 to RUB86.4bn in 2010.  Its total revenues
reached RUB418 billion in FY10, of which RUB334.5 billion or 80%
was attributed to electricity retail.

Fitch forecasts Russian GDP to grow at 4.2% in 2011 and then at
3.6% in 2012 and 2013 due to an easing in global growth.  The
agency estimates that Russian power consumption volumes will
increase by low single digits annually over 2011-2013.  Power
prices in Russia, at least in the European part and the Urals
region, are impacted by state-driven 15% annual increases in
natural gas prices until 2014, since natural gas accounts for
just under half of total electricity volumes generated.

RusHydro operates 68 power plants (almost exclusively hydro
generation) in Russia and Armenia, the majority of which are old
and have exceeded their useful lives.  This necessitates
significant investment in refurbishment and upgrade of hydro
power stations.  RusHydro's total capex for 2011-2013 is
estimated at around RUB350 billion including that for the BEMA
project (Boguchansk hydro power plant and aluminium smelter) and
OJSC RAO UES East (RAO UES East), the latter of which is expected
to be consolidated in 2011.  Fitch forecasts that RusHydro will
have to substantially increase its borrowings to finance capital
investment projects.

RusHydro has historically maintained low leverage -- in FY10, its
gross and net funds from operations (FFO) adjusted leverage were
0.7x and 0.4x, respectively, and FFO interest coverage was 41.4x.
RusHydro's debt repayment profile (before the consolidation of
RAO UES East) is comfortable.  Borrowings mainly consist of the
RUB20 billion Eurobonds maturing in 2015, RUB15 billion domestic
bonds maturing in 2021 (with a put option in 2016) and the EBRD
loan of RUB5.2 billion due in 2010-2020.  Based on Fitch's
conservative ratings case forecast the agency anticipates that
RusHydro's net FFO adjusted leverage will peak at around 3x in
2013 and FFO interest coverage will decline to about 4x by 2014
owing to the increase in borrowings to finance capex.

RusHydro's board recently voted in favour of acquiring the
government's 52.68% stake in RAO UES East, a holding company for
several thermal power and heat generation and distribution
companies based in the Far East of Russia, including
Yakutskenergo ('BB'/Stable).  With installed capacity of 8.8GW
and heat capacity of 16.7 thousand GCal/hour, RAO UES East mostly
operates coal and gas-fired power and heat plants across a
sparsely-populated territory.  Its tariffs are regulated and the
company heavily relies on subsidies from federal and regional
governments.  RAO UES East's financial profile is much weaker
than that of RusHydro.  At end-FY10, RAO UES East had RUB43.8
billion in gross unadjusted debt with a concentrated repayment
schedule -- most of the borrowings are due in 2011-2012,
including a RUB4 billion bond maturing in 2012.  When completed,
the acquisition of RAO UES East would increase RusHydro's share
in Russian generation to 16% (from 12% presently), but would
double RusHydro's consolidated leverage while contributing little
cash flow into the combined entity.  The capex requirements for
RAO UES East are estimated at RUB80 billion over 2011-2013.


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


AYT CAIXA: Fitch Affirms Rating on Class D Notes at 'Bsf'
---------------------------------------------------------
Fitch Ratings has affirmed four tranches of Ayt Caixa Sabadell
Hipotecario I, Fondo de Titulizacion de Activos and removed the
Rating Watch Negative (RWN) assigned to the class A notes as
follows:

  -- Class A (ISIN ES0312192000) affirmed at 'AAAsf'; Off RWN;
     Outlook Stable

  -- Class B (ISIN ES0312192018) affirmed at 'Asf'; Outlook
     Stable;

  -- Class C (ISIN ES0312192026) affirmed at 'BBB-sf'; Outlook
     Negative;

  -- Class D (ISIN ES0312192034) affirmed at 'Bsf'; Outlook
     Negative.

The loans included in the underlying pool were originated and are
serviced by Caixa d'Estalvis Unio de Caixes Manlleu, Sabadell i
Terrassa (Unnim; 'BB+'/Stable/'B').  The bank also acts as the
collection account in the transaction.  Under Fitch's structured
finance counterparty criteria, Unnim was not deemed to be
eligible to perform these duties, without mitigants in place.
Fitch placed the class A notes on RWN in July 2011 due to
commingling exposure and an increased risk of payment
interruption following the downgrade of Unnim earlier in the
year.

Fitch has been informed that in July 2011 the servicer
established a dynamic commingling deposit which is kept with an
eligible institution.  The agency has analyzed the terms and
conditions of the agreement.  In Fitch's view, the amount that
has been deposited is sufficient to mitigate the potential loss
of liquidity should Unnim default.  For this reason the class A
notes have been affirmed with a Stable Outlook.

The performance of the pool has not changed since the last review
date.  Fitch has received loan-by-loan level data as of the end
of July 2011, which shows the marginal migration of loans in
arrears by more than three months accounting for 6.7% of the
portfolio, compared to 6.3% as of the May interest payment date.
Although new defaults have been incurred, these have already been
incorporated in the rating actions taken in July 2011, which is
why Fitch was able to affirm the class B, C and D notes.  The
Negative Outlook on the class C and D notes reflects Fitch's
concerns over the weak performance of the pools, particularly in
a higher interest rate environment, which is expected in the
short term.


SANTANDER EMPRESAS: Moody's Assigns 'Ca' Rating to EUR1.2MM Notes
-----------------------------------------------------------------
Moody's Investors Service has assigned this definitive rating to
the notes issued by FTA Santander Empresas 8:

  -- Ca(sf) to EUR1,290MM Series C Floating rate Notes, due 2052

Ratings Rationale

FTA SANTANDER EMPRESAS 8 is a securitization of standard loans
and credit lines mainly granted by Banco Santander to corporate
and small and medium-sized enterprise (SME).

At closing, a cash reserve equal to EUR1,290MM was funded through
a subordinated loan provided by Banco Santander. The issuer has
now issued Series C notes and used the proceeds to cancel the
subordinated loan. The position in the waterfall for the
repayment of Series C notes will be the same as the subordinated
loan position (fully subordinated to the interest and principal
repayment of the Series A and B notes).

In Moody's view, the strong credit positive features of this deal
include, among others: (i) a granular pool (with an effective
number of obligors of over 500); (ii) a swap agreement
guaranteeing an excess spread of 1.0%; and (iii) a geographically
well-diversified pool. However, the transaction has several
challenging features: (i) this is the first securitization of
credit lines in the Spanish market; (ii) there is a high exposure
to the construction and building industry sector (around 40%);
(iii) a low percentage of assets are secured by a first-lien
mortgage guarantee (13.4%); and (iv) a complex mechanism allows
the Fondo to compensate (daily) the increase on the disposed
amount of certain credit lines with the decrease of the disposed
amount from other lines, and/or the amortization of the standard
loans. These characteristics were reflected in Moody's analysis
and provisional ratings, where several simulations tested the
available credit enhancement and 20% reserve fund to cover
potential shortfalls in interest or principal envisioned in the
transaction structure.

Moody's analysis focused primarily on (i) an evaluation of the
underlying portfolio of assets; (ii) historical performance
information and other statistical information; (iii) the credit
enhancement provided by the pool and swap spreads; and (iv) the
cash reserve and the subordination of the notes.

The resulting key assumptions of Moody's analysis for this
transaction are a mean default rate of 21.2%, with a coefficient
of variation of 35% and a stochastic mean recovery rate of 37.5%.

As mentioned in the methodology, Moody's used ABSROM cash-flow
model to determine the potential loss incurred by the notes under
each loss scenario. In parallel, Moody's also considered non-
modelled risks (such as counterparty risk).

The ratings address the expected loss posed to investors by the
legal final maturity of the notes (April 2052). Moody's ratings
address only the credit risks associated with the transaction.
Other non-credit risks have not been addressed, but may have a
significant effect on yield to investors.

The V Score for this transaction is Medium/High, which is in line
with the score assigned for the Spanish SME sector and
representative of the volatility and uncertainty in the Spanish
SME sector. V-Scores are a relative assessment of the quality of
available credit information and of the degree of dependence on
various assumptions used in determining the rating. For more
information, the V-Score has been assigned accordingly to the
report "V Scores and Parameter Sensitivities in the EMEA Small-
to-Medium Enterprise ABS Sector," published in June 2009.

Moody's also ran sensitivities around the key parameters for the
rated notes. For instance, if the assumed default probability of
21.2% used in determining the initial rating was changed to 27.2%
and the recovery rate of 37.5% was changed to 27.5%, the model-
indicated rating for the series C notes would be C.

The principal methodology used in the rating was Moody's Approach
to Rating CDOs of SMEs in Europe, published in February 2007.

Other methodologies used in this rating were Refining the ABS SME
Approach: Moody's Probability of Default assumptions in the
rating analysis of granular Small and Mid-sized Enterprise
portfolios in EMEA, published in March 2009 and Moody's Approach
to Rating Granular SME Transactions in Europe, Middle East and
Africa, published in June 2007.

Moody's assigned definitive ratings to Series A and B notes on
January 24, 2011.


SERIE BANCO: Fitch Upgrades Rating on Class D Notes From 'BB-sf'
----------------------------------------------------------------
Fitch Ratings has upgraded the three most junior tranches of
Serie Banco Gallego I, a securitization of Spanish SME loans
issued under the AyT Colaterales Global Empresas, FTA program.
Serie Banco Gallego I was originated and is serviced by Banco
Gallego. The rating actions are as follows.

  -- Class A notes (ISIN ES0312214200): Affirmed at 'AAAsf'sf';
     Outlook Stable

  -- Class B notes (ISIN ES0312214218): Upgraded to 'AAsf' from
     'Asf'; Outlook Stable

  -- Class C notes (ISIN ES0312214226): Upgraded to 'Asf' from
     'BBB-sf'; Outlook Stable

  -- Class D notes (ISIN ES0312214234): Upgraded to 'BBBsf' from
     'BB-sf'; Outlook Stable

The rating actions reflect the high level of credit enhancement
(CE) available for the notes as well as adequate counterparty
risk mitigants, especially the servicer commingling deposit,
which provides protection against a potential disruption on
collections.  The CE is commensurate with the rating stresses
that Fitch assumes for this portfolio.  Fitch acknowledges the
historically stable credit performance, which has been better
than the country benchmark (i.e. 90d+ arrears peaked at 3.8% in
April 2010 and represent 2.2% as of the last report date in April
2011 which is the same as the 90d+ average over the last 12
months).

The Stable Outlooks on all classes reflect the historically
stable credit performance, which remained steady throughout the
peak of the crisis.

The structural CE for the class A, B, C, and D notes is 65.6%,
46.2%, 34.4% and 27.8%, respectively, while the estimated mean
rating loss rate for the portfolio is 7.9%, assuming the
performance benchmark for Spain.  The slightly underfunded cash
reserve fund (RF) contributes 27.8% to CE.  The RF currently
holds EUR19.3m and is slightly below the required level of
EUR20.7m as it has been used to provision for current defaults.

Up to 60% of the assets are secured by mortgage collateral and
Fitch has assigned a rating recovery rate (RRR) of 48.3% to this
portfolio in a 'AAA' scenario.  Fitch notes that recovery
processes are taking longer in the current macroeconomic
environment and the agency expects recoveries to pick up for this
and other Spanish transactions.  Fitch highlights that 22 out of
the 23 defaulted assets in the portfolio to date were not secured
on mortgage collateral and hence the low level of recoveries on
defaults of 14% are commensurate with the unsecured nature of
these assets.

Fitch has assigned an Issuer Report Grade (IRG) of two stars
("Basic") to this transaction.  This IRG partly reflects pending
improvements to quality control and reporting that the agency
expects AyT to complete by 1 October 2011.  Fitch's IRGs refer
only to reporting standards relative to public information.

The current portfolio information provided to Fitch for the
analysis was missing essential fields.  Fitch has overcome the
data issues by cross-linking the complete original portfolio data
and information provided by AyT in the closing collateral
datatape.  Therefore, the agency was able to complete the review
analysis that resulted in the rating actions by simulating the
various rating stresses within its Portfolio Credit Model (PCM).
AyT is currently improving its IT systems in order to produce
regular portfolio datatapes that will be compliant with the
requirements set by the European Central Bank, which will include
the currently missing information.

Fitch does not believe that the exposure to Banco Gallego as
servicer represents a material payment interruption risk for this
transaction because of the short holding period, and large
liquidity support provided by cash reserves.  The transaction
features a fully funded commingling deposit that covers 1.5 times
the sum of all periodic instalments on the assets, plus an
additional 1.25% of the current portfolio balance to account for
potential prepayments. This would become available if the
servicer failed to transfer collections and would be applied
unrestrictedly to any shortfall in the priority of payments.
Furthermore, the RF provides liquidity and protection against
losses.  Banco Gallego holds collections from the assets for one
day before transferring them into the Treasury Account of the
fund held at Confederacion Espanola de Cajas de Ahorros (CECA,
'A+'/Negative/'F1') where the RF is held.  CECA also holds the
commingling deposit in a separate account of the issuer.


SERIE CAJA: Fitch Affirms Rating on Class D Notes at 'Bsf'
----------------------------------------------------------
Fitch Ratings has affirmed Serie Caja Navarra I, a securitization
of Spanish SME loans issued under the AyT Colaterales Global
Empresas, FTA program. Serie Caja Navarra I was originated and is
serviced by Caja de Ahorros y Monte de Piedad de Navarra (now
Banca Civica S.A., 'BBB+'/Stable/'F2').  The rating actions are
as follows.

  -- Class A notes (ISIN ES0312214044): affirmed at 'AAAsf';
     Outlook Stable

  -- Class B notes (ISIN ES0312214051): affirmed at 'Asf';
     Outlook Stable

  -- Class C notes (ISIN ES0312214069): affirmed at 'BBB-sf';
     Outlook Stable

  -- Class D notes (ISIN ES0312214077): affirmed at 'Bsf';
     Outlook Stable

The affirmations reflect the transaction's performance and the
credit enhancement (CE) available for the notes.  The CE is
commensurate with the rating stresses that Fitch assumes for this
portfolio.  The performance is better than the country benchmark
as 90d+ arrears currently represent 0.95% of the current
portfolio balance.  The CE for the class A, B, C, and D notes is
44.0%, 27.5%, 17.7%, and 8.9%, respectively, while Fitch
estimates a mean rating loss rate (RLR) for this portfolio of
6.2%, assuming the performance benchmark for Spain.

Fitch has assigned an Issuer Report Grade (IRG) of two stars
("Basic") to this transaction.  This grade is applied on the
basis of pending improvements on reporting and quality control.
Fitch expects AyT to implement them by October 1, 2011.

The current portfolio information provided to Fitch for the
analysis was missing essential fields.  Fitch has overcome the
data issues by cross-linking the complete original portfolio data
and information provided by AyT in the closing collateral
datatape.  Therefore, the agency was able to complete the review
analysis that resulted in the rating actions by simulating the
various rating stresses within its Portfolio Credit Model (PCM).
AyT is currently improving its IT systems in order to produce
regular portfolio datatapes that will be compliant with the
requirements set by the European Central Bank, which will include
the currently missing information.

Fitch does not believe that the exposure to Banca Civica as
servicer represents a material payment interruption risk for this
transaction because of the short holding period and the currently
available reserve fund (RF).  The RF is expected to remain almost
fully funded and will act as an excess spread trap until it
reaches its required balance of EUR12.4 million. Banca Civica
holds collections from the assets for one day before transferring
them into the fund's treasury account held at Confederacion
Espanola de Cajas de Ahorros ('A+'/Negative/'F1') where the
reserve fund is held.


===========
S W E D E N
===========


SAAB: Sells Technology to Secure Funds As Unions Seek Bankruptcy
----------------------------------------------------------------
Janina Pfalzer and Ola Kinnander at Bloomberg News report that
Saab Automobile agreed to sell technology to secure funds on
Monday as two of its unions asked a court to declare the company
bankrupt.

According to Bloomberg, Swedish Automobile N.V., Saab's owner,
said it would sell the non-exclusive rights to the Phoenix
manufacturing platform to Zhejiang Youngman Lotus Automobile Co.
for EUR70 million (US$95.5 million,) using a special purpose
company, Swedish Automobile cooperatief UA.  Swedish Automobile
said in a statement that Saab expects to receive the
EUR70 million from Zhejiang Youngman by Sept. 26, Bloomberg
notes.

Two unions, representing managers and administrative employees,
asked Vaenersborg District Court to put the carmaker into
bankruptcy on Monday, according to Bloomberg.  The unions said
they will rescind if Saab pays their members before the court has
passed judgment, the report notes.  According to SeeNews, Swedish
Automobile confirmed on Monday that Swedish trade unions Unionen
and Ledarna have filed for the bankruptcy of the Swedish
carmaker.

"We're working toward a reorganization and a bridge financing
solution, and the conditions for those are improving," Bloomberg
quotes Eric Geers, a Saab spokesman, as saying in a phone
interview.  The unions' bankruptcy petitions "won't really affect
our process," Mr. Geers said.

According to Bloomberg, Pia Nilsson Taari, a legal official at
Vaenersborg Court, said by phone that a Swedish court normally
takes about two weeks to decide on a bankruptcy petition and may
take up to six weeks.  The same court on Sept. 9 rejected Saab's
petition for protection from creditors, Bloomberg notes.  The
tribunal said on its Web site that Saab filed the appeal on the
Sept. 9 decision on Monday, Bloomberg relates.

In a separate report, Agence France Presse relates that in its
appeal submitted Monday, Saab said it was "of the opinion that by
rejecting the voluntary reorganization proposal based on the
reasons cited in the rejection statement, the district court went
considerably further in its consideration than what the
legislator intended. . . . The district court has applied a much
stricter standard of proof than is required under the (Swedish
Company Reorganisation) Act."

The biggest union at Saab, IF Metall, which represents the blue-
collar workers, said it would not immediately follow the other
unions, AFP notes.

According to AFP, IF Metall chairman Stefan Loefven told Swedish
news agency TT, "Our members would get their money much faster in
the event of a voluntary reorganization than a bankruptcy, where
the process of negotiations takes several weeks."

As reported by the Troubled Company Reporter-Europe on Aug. 29,
2011, Bloomberg News related that Saab delayed paying wages for
the third month in a row.  Saab was scheduled to pay factory
workers on Aug. 25 and administrative employees on Aug. 26,
Bloomberg disclosed.  The Swedish government's Debt Enforcement
Agency started collection proceedings last month at the request
of component suppliers with unpaid bills, Bloomberg recounted.

Saab Automobile AB is a Swedish car manufacturer owned by Dutch
automobile manufacturer Swedish Automobile NV, formerly Spyker
Cars NV.


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


BEETHAM HOTELS: Administrators Sell Assets to Blue Manchester
-------------------------------------------------------------
manchesterconfidential.co.uk reports that Beetham Hotels
Manchester Ltd, which owned the part of the Beetham Tower
occupied by Hilton Hotels, has been sold by administrators.

As reported in the Troubled Company Reporter-Europe on Feb 21,
2011, Manchester Evening News reports that Beetham Hotels
Manchester had gone into administration, with KPMG as its
administrators.  The report related that the hotel continues to
trade as normal and no redundancies have been made.

Bank of Scotland were owed GBP87 million by the two companies
when they went into administration, although GBP62 million has
been paid back, according to manchesterconfidential.co.uk.

A new report by KPMG revealed that Beetham Hotels has been sold
to Blue Manchester Ltd, manchesterconfidential.co.uk relates.
Beetham Hotels Liverpool Ltd, which owned the Radisson Blu in
that city, was also sold as part of the deal, to Blue Liverpool
Ltd., manchesterconfidential.co.uk discloses.

manchesterconfidential.co.uk says that the total value of the
deal was GBP60 million, although the two hotels had been on the
market with CBRE for GBP65 million.

Beetham Hotels Manchester is a Liverpool-based property company
with a management agreement with Hilton Worldwide.  The hotel has
340 staff.


BRITISH MIDLAND: First-Half Losses May Prompt Sale
--------------------------------------------------
BreakingNews.ie reports that BMI British Midland is up for sale
after losses soared over the past six months.

BMI, Heathrow's second largest airline, plunged GBP105 million
(EUR122.1 million) into the red in the first half of 2011,
prompting German parent Lufthansa to appoint investment bank
Morgan Stanley to explore options for disposing of the carrier,
BreakingNews.ie says, citing The Sunday Times.

BreakingNews.ie notes that despite the losses, which work out at
GBP38 (EUR44.19) per passenger, BMI is expected to attract plenty
of interest as it controls 10% of the take-off and landing slots
at Heathrow, a portfolio it valued at GBP770 million (EUR895.6
million) in 2008.

Lufthansa will also consider breaking up the group, which could
involve a sale of BMI's no-frills subsidiary BMI Baby, the
regional division BMI Regional and possibly the group's HQ at
Donington Hall near Derby, BreakingNews.ie states.

The German group took full control of BMI two years ago but
attempts to improve its performance have been hit by steep rises
in the cost of aviation fuel and also the recent uprisings in
North Africa and the Middle East, which have badly affected
demand for flights to the region, BreakingNews recounts.

According to BreakingNews.ie, BMI said it is discussing the
options for its future with Lufthansa but no decision had been
taken.

British Midland Airways, which does business as bmi, --
http://www.iflybritishmidland.com/-- carries passengers to some
30 countries, mainly in the UK but also in continental Europe,
the Middle East, Asia, and Africa.  It operates a fleet of about
50 jets, including Airbus and Embraer models.  Low-fare
subsidiary bmi baby serves about 30 destinations in Europe with a
fleet of about 20 Boeing 737s.  bmi is a member of the Star
Alliance global marketing group, which includes UAL's United
Airlines, Air Canada, and Singapore Airlines.  In mid-2009,
fellow Star Alliance member and global airline giant Lufthansa
acquired majority ownership of bmi.


CHOICES CARE: Charities Welcome Move to Seek New Bidders
--------------------------------------------------------
The Herald reports that an alliance of learning disability
charities has welcomed a decision by Glasgow City Council to seek
new bidders to run services previously operated by the collapsed
company Choices Care.

Choices Care administrators had struck a deal for the Choices
Supported Living Service to be bought by the Mears Group,
according to The Herald.

However, the report relates, following a recommendation from
social work chief David Crawford, Glasgow's executive committee
decided that it could not simply hand the contract over to Mears,
which is a large domiciliary care provider operating largely
south of the border.

As reported in the Troubled Company Reporter on Aug. 9, 2011,
Edinburgh Evening News said that Choices Care has been partly
sold off while administrators attempt to find a buyer for about
two-thirds of the firm's operations.  The group's supported
living division, which provides services to several clients on
Bute, administered locally from an office at Bute Business Park
in Rothesay, has been sold to Mears Care Scotland Ltd, and a
spokesperson relayed that it was business as usual for both
clients and staff as a result, according to The Buteman.

Choices Care is a major care provider in the Lothians.  It works
with people across the south of Scotland and north of England.


COMET: Pension Liabilities May Hamper Auction Process
-----------------------------------------------------
Claer Barrett and Anousha Sakoui at The Financial Times report
that the sale of Comet, the lossmaking electrical retailer, is
increasingly unlikely to proceed after offers tendered by the two
remaining parties in the auction indicated that a cash dowry of
GBP150 million-GBP200 million (US$239 million-US$319 million)
would be required to compensate for pension liabilities and
working capital concerns.

According to the FT, sources close to the auction process have
expressed doubts that the sale will go ahead, believing that
shareholders in Kesa, Comet's parent company, will balk at the
level of compensation bidders are demanding, and align with the
board's original plans to focus on turning round the business.
Hilco, the restructuring group, and OpCapita, the private equity
firm, both submitted detailed proposals to Kesa last week but the
increasingly complicated nature of negotiations has extended the
auction process, the FT recounts.

The offers put forward by the two parties are understood to be
highly conditional, with the size of the cash dowry varying
according to different scenarios, chiefly whether Comet's pension
liability would remain with Kesa, or be transferred to the new
owner, the FT discloses.  Prospective buyers are nervous that if
the Pensions Regulator takes a dim view of any deal, they could
potentially be required to make a contribution of hundreds of
millions of pounds, the FT says.

Another tipping point in the negotiations is the level of working
capital that will be needed to fund the business in order to give
confidence to Comet's suppliers if it is separated from its
profitable parent company, according to the FT.  Buyers would
also want to be compensated for the risks of taking on property
lease liabilities on Comet's 249 UK stores, which have an average
of nine years left to run, the FT states.

As reported by the Troubled Company Reporter-Europe on Aug. 2,
2011, Dow Jones Newswires related that Kesa Electricals PLC won't
consider selling its struggling unit Comet to anyone who would
place it into administration, shrinking the pool of potential
acquirers that likely includes several specialist liquidators.
Dow Jones noted that this means that several restructuring
specialists that have reportedly expressed interest, such as GA
Europe, Hilco and Gordon Brothers, are likely to be out of the
running given their precedent in liquidations.  Private equity
group OpCapita remains as a strong contender for the chain, Dow
Jones disclosed.

Comet is Kesa Electricals PLC's electrical chain in United
Kingdom.


GEORGE STREET: Goes Into Liquidation
------------------------------------
James Verrinder at Research Magazine reports that George Street
Research has gone into liquidation.

According to Research, accounting firm Johnston Carmichael in
Edinburgh confirmed it had been appointed as liquidator.

Financial documents for the year ending March 31, 2010, filed
with Companies House show turnover down year-on-year from
GBP1.1 million to GBP975,000 and operating profit almost halving
from GBP35,000 to GBP16,870, Research discloses.  Profits for the
year were GBP12,500, Research notes.

George Street was a Scottish market research and fieldwork
agency.  The company employed around 15 people at its offices in
Broughton Street, Edinburgh.  It offered qual and quant services
to clients in the agricultural, financial, housing, leisure and
media, tourism, transport and health and welfare sectors.


HEALTHCARE LOCUMS: Shareholders Approve Refinancing Plan
--------------------------------------------------------
Simon Mundy at The Financial Times reports that Healthcare Locums
was expected to resume trading yesterday after shareholders
narrowly voted to approve a GBP61 million (US$96 million) capital
raising at a tense extraordinary meeting.

According to the FT, the refinancing plan was backed by 77.25% of
votes cast, despite a revolt by some institutional investors who
said it would excessively dilute existing stakes.  It needed 75%
approval to pass, the FT notes.

The vote came after more than an hour of debate involving several
large shareholders, including fund managers Fidelity and Jupiter
and Kate Bleasdale, HCL founder and former chief executive, the
FT relates.

Opposition was led by Permian Investment Partners and Arundel
Capital, two US hedge funds that said there were better
alternatives for shareholders, the FT recounts.

According to the FT, Peter Sullivan, HCL chairman, told
shareholders: "The survival of your company is at stake."  If the
funds defeated the plan, it would be a "betrayal of their fellow
shareholders".

He cited a letter from Commonwealth Bank and National Australia
Bank, which are owed GBP105 million by HCL, the FT discloses.
The letter said a standstill agreement on the debt servicing
obligations would collapse if the company did not seem likely to
restructure its finances by October 17, the FT relates.
According to the FT, he said that this would push the company
into insolvency.

The FT notes that Cara Goldenberg, founder of Permian, which has
invested in 6.35% through contracts for difference, accused
Mr. Sullivan of trying to scare shareholders and selectively
releasing financial data to "make the business look as unhealthy
as possible".

HCL shares were suspended in January after the discovery of
accounting irregularities, the FT recounts.  They will resume
trading on Aim at 10 pence, against 112 1/2 pence before they
were suspended, the FT states.

Healthcare Locums is a UK-based medical recruitment agency.


HMV PLC: Sales Slide 19%, But Says Christmas Plans on Track
-----------------------------------------------------------
Dow Jones' DBR Small Cap reports that struggling U.K.
entertainment retailer HMV PLC said that fiscal first-quarter
sales fell 19.4%, reflecting a tough economic environment and the
closure of 29 stores, but noted that its plans for the important
Christmas trading period are on track.

United Kingdom-based HMV Group plc is engaged in retailing of
pre-recorded music, video, electronic games and related
entertainment products under the HMV and Fopp brands, and the
retailing of books principally under the Waterstone's brand.  The
Company operates in four segments: HMV UK & Ireland, HMV
International, HMV Live, and Waterstone's.  HMV International
consists of HMV Canada, HMV Hong Kong and HMV Singapore.
Waterstone's is a bookseller, which operates through 314 stores
and a transactional Web site for the sale of both physical and e-
books for download.  The Company has operations in seven
countries, with principal markets being the United Kingdom and
Canada.  Its retail businesses operate through 417 stores in the
United Kingdom, Canada, Hong Kong and Singapore.  On Jan. 29,
2010, the Company completed the acquisition of MAMA Group Plc.
Its subsidiaries include HMV Canada Inc, HMV Guernsey Limited,
HMV Hong Kong Limited, and HMV (IP) Limited.


* UK: Bank Reform Proposal Gets Widespread Support
---------------------------------------------------
BBC News reports that there has been widespread support for a
government-backed commission that has recommended UK banks ring-
fence retail from investment banking.

According to BBC, the Independent Commission on Banking, led by
Sir John Vickers, said it would "make it easier and less costly
to resolve banks that get into trouble."

The ICB called for the changes to be implemented by the start of
2019, BBC discloses.

Chancellor George Osborne said the report would mean UK banks
could remain competitive, BBC relates.

The report recommends that ring-fenced banks should be the only
operations granted permission by the UK regulator to provide
"mandated services", which include taking deposits from and
making loans to individuals and small businesses, BBC says.

It says that the different arms of banks should be separate legal
entities with independent boards, BBC notes.  Another of the
ICB's recommendations is that banks must have a buffer to absorb
the impact of potential losses or future financial crises -- of
at least 10% of domestic retail assets in top-quality form, such
as shares or retained earnings, BBC discloses.  It also says the
biggest banks should go further than this and have a safety
cushion of between 17% and 20% of assets, made up of highest
quality assets topped up with bonds that can be easily converted
to equity, according to BBC.


                            *********

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, Ivy B.
Magdadaro, Frauline S. Abangan and Peter A. Chapman, Editors.

Copyright 2011.  All rights reserved.  ISSN 1529-2754.

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

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

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


                 * * * End of Transmission * * *