TCREUR_Public/111222.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Thursday, December 22, 2011, Vol. 12, No. 253



BONAVENTURA: S&P Affirms 'B+' Rating on EUR425-Mil. Secured Bonds


DEXIA SA: Sells Luxembourg Unit to Precision Capital


TALISMAN-3 FINANCE: Fitch Affirms 'C' Ratings on Two Note Classes
WESTLB AG: European Commission Approves Break-Up Plan


OMEGA NAVIGATION: Judge May Sanction HSH for Faulty Allegations
* GREECE: Has Initial Deal with Bondholders on Debt Swap Terms


BANK OF IRELAND: Wins European Union Approval for State Aid


CELL THERAPEUTICS: Retires Remaining Convertible Debt


BANK OCHRONY: Fitch Affirms Individual Rating at 'D'


BANCO ESPIRITO: S&P Lifts Rating on Guaranteed Sr. Debt From 'BB'


FTPYME TDA: Fitch Affirms Rating on Series 3SA Notes at 'BBsf'
SACYR VALLEHERMOSO: Staves Default After Repsol Purchases Stake
* VALENCIA REGION: Moody's Downgrades Debt Rating to 'Ba1'


SAAB AUTOMOBILE: Pang Da Halts Bid; Breakup Looms


MORYE: Crimean Court Extends Bankruptcy Procedure Through Jan. 2

U N I T E D   K I N G D O M

CLEARY DOYLE: NAMA Places Firm Into Receivership
COVENTRY & RUGBY: S&P Affirms 'BB+' Rating on GBP407.2-Mil. Bonds
CUMBRIAN SEAFOOD: Jobs at Fish Factory Under Threat
HEALTHCARE LOCUMS: Set to Appoint New Advisors
NORTHERN ROCK: S&P Raises Rating on Tier One Notes to 'BB+'

PADDINGTON HOUSE: Goes Into Administration, Seeks Buyer
WEDGWOOD MUSEUM: To Sell Collection to Plug GBP134MM Shortfall
* UK: Consumer Sector Insolvencies Expected to Rise


* EUROPE: Almunia Warns of More Bank Restructurings in 2012
* EUROPE: Plans for Failing Banks Expected in 2012, Barnier Says
* EUROPE: Moody's Says Outlook on 2012 CLOs Negative
* Upcoming Meetings, Conferences and Seminars



BONAVENTURA: S&P Affirms 'B+' Rating on EUR425-Mil. Secured Bonds
Standard & Poor's Ratings Services affirmed the 'B+' long-term
ratings on the EUR425 million in floating-rate senior secured
bonds, due 2039, and a EUR350 million floating-rate senior
secured loan from the European Investment Bank (EIB;
AAA/WatchNeg/A-1+), due 2038, issued by Luxembourg-registered
Ostregion Investmentgesellschaft Nr. 1 S.A. (Ostregion), a
special-purpose vehicle for the financing of an Austrian road

"At the same time, we removed these ratings from CreditWatch
where they were placed, with negative implications, on Aug. 8,
2011," S&P said.

"We now understand that Bonaventura is unlikely to be declared
insolvent under Austrian law, based on information we recently
received from Bonaventura's management, including statements from
Bonavantura's auditors and insolvency expert. We understand that
the going-concern prognosis undertaken by the company's auditors
will most likely take into account only the current and following
year, rather than the remaining project life, as we had been
previously informed," S&P said.

"The stable outlook reflects our view of stable, though
relatively tight, SDSCRs and minimal use, if at all, of the
project's DSRA during the remainder of the project's life. We
forecast SDSCRs at or marginally above 1.05x after receipt of
payments under ASFINAG's top up guarantee in our updated base
case, which incorporates our latest traffic forecast and our view
that significant unavailability penalties and/or cost slippage
are unlikely, given the positive track record to date and the
back-to-back nature of the contract with the road's operator,"
S&P said.

"We could take a positive rating action if actual traffic volumes
improved significantly, leading to a sustained material
improvement in SDSCRs, or if the project demonstrated no recourse
to the DSRA because of timely receipt of ASFINAG's guarantee
payments," S&P said.

"Conversely, we could revise the outlook to negative or lower the
ratings if the project demonstrated substantial recourse to the
DSRA, thus further weakening its liquidity," S&P said.


DEXIA SA: Sells Luxembourg Unit to Precision Capital
Stanley Pignal at The Financial Times reports that the
dismantling of Dexia, the twice bailed-out Franco-Belgian bank,
gathered pace on Tuesday as it announced the sale of its
Luxembourg unit to Precision Capital, a Qatari investor, valuing
it at EUR730 million.

Dexia Banque Internationale a Luxembourg is the second subsidiary
to be sold following the intervention of the Belgian and French
authorities to save Dexia after it ran out of cash in early
October, the FT discloses.

Its Belgian arm was nationalized soon afterwards in what amounted
to a winding up of the specialist municipal lender, the FT

According to the FT, Precision Capital, owned by the Qatari
ruling family, will take a 90% stake in BIL, which includes
commercial and private banking arms.  The Luxembourg government
will own the remaining 10%, the FT states.

The Qatari group did not say whether it intended to run the
operations jointly, the FT notes.

The transaction price values BIL at 5.2 times 2010 earnings, and
is below the EUR900 million that analysts had expected since a
deal with the Qataris was first mooted at the start of October,
the FT discloses.  According to the FT, people close to the bank
said that the sale will probably translate into a significant
accounting loss for Dexia.

All its healthy subsidiaries are in the process of being sold so
that it can finance a highly leveraged portfolio of bonds, the FT
says.  These have been grouped into a "bad bank" structure which
will receive state guarantees to fund itself, the FT notes.

As well as Dexia Bank Belgium and BIL, Dexia is seeking buyers
for a number of its operations: its asset management arm, which
is understood to have received interest from more than thirty
potential suitors; DenizBank, its Turkish retail unit which has
attracted HSBC and Russia's Sberbank among others; and RBC Dexia
Investor Services, the back-office specialist which is thought
likely to be snapped up by Royal Bank of Canada, its joint-
venture partner, according to the FT.

The EUR90 billion bail-out package agreed in September still
awaits approval from the European Commission, which is expected
later this week, the FT states.

Dexia SA -- is a Belgian-based bank and
insurance carrier that focuses on Public and Wholesale Banking,
providing local public finance actors with banking and financial
solutions, and on Retail and Commercial Banking in Europe, mainly
Belgium, France, Luxembourg and Turkey.


TALISMAN-3 FINANCE: Fitch Affirms 'C' Ratings on Two Note Classes
Fitch Ratings has downgraded Talisman-3 Finance p.l.c. class D
notes, and affirmed all other tranches as follows:

  -- EUR15.1m class B (XS0256114892): affirmed at 'AAAsf';
     Outlook Stable

  -- EUR19.6m class C (XS0256115436): affirmed at 'AAsf'; Outlook
     revised to Negative from Stable

  -- EUR42.7m class D (XS0256115865): downgraded to 'CCsf' from
     'CCCsf'; Recovery Estimate (RE) 80%

  -- EUR10m class E (XS0256116327): affirmed at 'Csf'; RE 0%

  -- EUR5m class F (XS0256116673): affirmed at 'Csf'; RE 0%

The downgrade of the class D notes and the Negative Outlook on
the class C notes reflect the increased risk of a protracted
workout of the Berlin & Dresden loan.  The other loan, Waterloo,
remains of high quality, which is central to the affirmation of
the other notes.

The larger and weaker of the two remaining loans, Berlin &
Dresden (70.6% of the outstanding balance), matures in January
2012.  The servicer, Hatfield Philips, had granted a two-year
extension to the original loan term at its maturity date in
January 2010.  At the same time, the 85% loan-to-value ratio
(LTV) covenant was waived; it had been breached as a result of an
October 2009 revaluation reporting a reduction of 45% of the
original market value of the mortgaged property.  Since the
extension was granted, there has been little de-leveraging
despite strong interest coverage.  This is in part due to
significant payments to the loan sponsor agreed by the servicer
at the time of the extension.  With a reported LTV of 138%,
applying much more excess cash flow to repay principal would
provide some mitigant to the losses expected on this loan, as
reflected in the highly distressed ratings on the classes D to F

The smaller Waterloo loan is performing well.  Vacancy has fallen
to 2.9%, its lowest level since origination.  The stability of
the collateral is reflected in the December 2010 re-valuation,
which showed only a modest 1.3% decline in asset value since
December 2005.

WESTLB AG: European Commission Approves Break-Up Plan
Ulrike Dauer at Dow Jones Newswires reports that the European
Commission, the executive arm of the European Union, said Tuesday
it approved a plan to split up German state-controlled lender
Westdeutsche Landesbank, or WestLB, leading to the sale and
eventual winding down of its banking activities.

The plan, submitted by the bank's owners -- the German state of
North Rhine-Westphalia and regional savings banks -- and
Germany's federal government at the end of June, "is in line with
EU state aid rules," Dow Jones quotes the Commission as saying.

According to Dow Jones, the commission said that under the plan,
WestLB's so-called Verbundbank business -- essentially its
central bank services to savings banks in the region where it
operates and mid-cap corporate lending -- will be carved out.
Frankfurt-based state-owned peer Landesbank Hessen-Thueringen, or
Helaba, said Dec. 12 it plans to take over the assets and
liabilities of WestLB's Verbundbank business, Dow Jones recounts.

All other assets and liabilities not sold by June 30 will be
transferred to WestLB's EAA "bad bank" on that day, Dow Jones
discloses.  After June 30, WestLB won't engage in new banking
business and will be transformed into a servicing platform with a
run-down vehicle that holds legacy positions transferred to or
hedged by WestLB's EAA "bad bank," the commission, as cited by
Dow Jones, said.

Dow Jones relates that the commission said this transformation
will require additional aid by the state government of North
Rhine-Westphalia, Germany's SoFFin bank rescue fund and German
savings banks, without specifying the amount needed.

As reported in the Troubled Company Reporter-Europe on Nov. 18,
2011, Dow Jones' Daily Bankruptcy Review related that the
European Commission's antitrust body hopes to adopt a final
decision in the restructuring of WestLB by the end of the year.

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


OMEGA NAVIGATION: Judge May Sanction HSH for Faulty Allegations
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that when Omega Navigation Enterprises Inc. beat back an
effort by HSH Nordbank AG to dismiss or convert the Chapter 11
case to liquidation in Chapter 7, U.S. Bankruptcy Judge Karen K.
Brown in Houston said that the Hamburg-based agent for secured
lenders displayed "reckless disregard for truth and an
intentional strategy to delay and impede the bankruptcy

According to the report, Judge Brown said in her 14-page opinion
that she will hold a hearing to decide whether to impose
sanctions on HSH or its lawyers from White & Case LLP in New

In addition to imposing monetary sanctions, Judge Brown said she
will consider whether to subordinate HSH's claim, deny voting
rights on the claim, or require the bank to pay the bankrupt
company's company legal fees.

The report relates that Judge Brown pointed to allegations the
bank made about financial improprieties committed by Omega.  As
to some, Judge Brown ruled after trial that there was "no
evidence."  As to another, she said the bank consented to the
action, which was designed to bring badly needed cash into the
company.  Judge Brown disagreed with HSH's strategy to threaten
suit against Omega's outside directors unless they voted to
dismiss the bankruptcy reorganization.  She appointed an examiner
who issued a report saying it was appropriate "to sanction HSH"
by ordering the bank not to threaten lawsuits. The examiner also
concluded that HSH should pay some of Omega's attorneys' fees.

                      About Omega Navigation

Athens, Greece-based Omega Navigation Enterprises Inc. and
affiliates, owner and operator of tankers carrying refined
petroleum products, filed for U.S. Chapter 11 protection (Bankr.
S.D. Tex. Lead Case No. 11-35926) on July 8, 2011, in Houston.

Omega is an international provider of marine transportation
services focusing on seaborne transportation of refined petroleum
products.  The Debtors disclosed assets of US$527.6 million and
debt totaling US$359.5 million.  Together, the Debtors wholly own
a fleet of eight high-specification product tankers, with each
vessel owned by a separate debtor entity.

Judge Karen K. Brown presides over the case.  Bracewell &
Giuliani LLP serves as counsel to the Debtors.  Jefferies &
Company, Inc., is the financial advisor and investment banker.

The Official Committee of Unsecured Creditors has tapped Winston
& Strawn as local counsel; Jager Smith as lead counsel; and First
International as financial advisor.

* GREECE: Has Initial Deal with Bondholders on Debt Swap Terms
Maria Petrakis and Marcus Bensasson at Bloomberg News, citing
Web site Euro2day, report that Greece's government and
bondholders reached an initial agreement on some of the terms of
a debt swap at meetings in Paris last week.

According to Bloomberg, the Web site said that the two parties
agreed the new bonds would be governed by British law and that
they would contain clauses for greater returns if economic growth
outperforms projections.

The Web site, as cited by Bloomberg, said that bondholders have
proposed the new bonds carry an interest rate of 4% for the first
three years, 4.5% for the next five years and 5% thereafter.
Euro2day said that no agreement has been reached on that proposal
yet, Bloomberg notes.  The Web site said that the proposal means
an effective net present value loss of 65%, Bloomberg relates.


BANK OF IRELAND: Wins European Union Approval for State Aid
Aoife White at Bloomberg News reports that Bank of Ireland Plc
won European Union approval for Irish government help after it
agreed to reduce reliance on wholesale funding and focus on
"balanced-risk" lending in Britain and Ireland.

According to Bloomberg, regulators said in a statement on Tuesday
that the European Commission authorized Irish government
recapitalizations, guarantees and asset relief after the bank
made plans to "substantially deleverage its balance sheet to
reduce its dependency on wholesale funding," exit risky
portfolios and implement better risk management.

Regulators must approve large state payments to lenders that
needed help during the financial crisis and has required banks to
shrink balance sheets and change the way they do business to
compensate for any harm to competition, Bloomberg notes.

EU Competition Commissioner Joaquin Almunia said in a statement
that Bank of Ireland and Allied Irish Banks Plc, the country's
two biggest lenders, require "close surveillance" because they
will control the Irish market after receiving bailouts, Bloomberg

Bank of Ireland said in June that it intended to reverse plans to
sell its ICS Building Society unit under its revised EU
restructuring program, Bloomberg recounts.  It also said it would
delay the sale of its New Ireland life assurance unit, according
to Bloomberg.  The EU ordered the bank to sell both divisions as
part of its original restructuring blueprint, approved in July
2010, Bloomberg discloses.

According to Bloomberg, Bank of Ireland said Tuesday's EU
requirements "are consistent with those set out in the prospectus
published on June 18" and that the lender "continues to make good
progress in implementing the commitments" of its restructuring

Bank of Ireland is alone among the country's six largest lenders
in escaping government control, after the state agreed July 27 to
sell a 34.9% stake to five investors, including Toronto-based
Fairfax Financial Holdings Ltd. and WL Ross & Co., the New York-
based investment firm, Bloomberg says.  The bank was ordered to
raise EUR5.2 billion of capital following stress tests in March,
Bloomberg recounts.

Headquartered in Dublin, Bank of Ireland -- provides a range of banking and
other financial services.  These include checking and deposit
services, overdrafts, term loans, mortgages, business and
corporate lending, international asset financing, leasing,
installment credit, debt factoring, foreign exchange facilities,
interest and exchange rate hedging instruments, executor,
trustee, life assurance and pension and investment fund
management, fund administration and custodial services and
financial advisory services, including mergers and acquisitions
and underwriting.  The Company organizes its businesses into
Retail Republic of Ireland, Bank of Ireland Life, Capital
Markets, UK Financial Services and Group Centre.  It has
operations throughout Ireland, the United Kingdom, Europe and the
United States.


CELL THERAPEUTICS: Retires Remaining Convertible Debt
Cell Therapeutics, Inc., has deposited US$11.2 million in cash as
trust funds with U.S. Bank National Association, as the trustee
of the outstanding 5.75% convertible senior notes, which is an
amount sufficient to pay and discharge the entire amount due on
the Notes, including accrued and unpaid interest.  CTI has now
retired all of its outstanding convertible debt.

"We have worked diligently over the past five years to
restructure, exchange, and retire all of our convertible debt
while continuing to advance our product candidates toward market.
The deleveraging of our balance sheet puts CTI in a stronger
financial position as we ready for potential product approval in
2012," stated Louis A. Bianco, Chief Financial Officer of CTI.

                      About Cell Therapeutics

Headquartered in Seattle, Washington, Cell Therapeutics, Inc.
(NASDAQ and MTA: CTIC) -- is
a bi4opharmaceutical company committed to developing an
integrated portfolio of oncology products aimed at making cancer
more treatable.

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

The Company also reported a net loss attributable to CTI of
US$53.39 million on $0 of revenue for the nine months ended
Sept. 30, 2011, compared with a net loss attributable to CTI of
US$62.92 million on $319,000 of total revenues for the same
period during the prior year.

The Company's balance sheet at Sept. 30, 2011, showed
US$62.85 million in total assets, US$33.89 million in total
liabilities, US$13.46 million in common stock purchase warrants,
and US$15.49 million total shareholders' equity.

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

                        Bankruptcy Warning

The Company has incurred losses since inception and expect to
generate losses for the next few years primarily due to research
and development costs for Pixuvri, OPAXIO, tosedostat,
brostallicin and bisplatinates.

If the Company receives approval of Pixuvri by the European
Medicines Agency or the Food and Drug Administration, the Company
would anticipate additional commercial expenses associated with
Pixuvri operations.  Accordingly, the Company will need to raise
additional funds and is currently exploring alternative sources
of equity or debt financing.  The Company may seek to raise such
capital through public or private equity financings,
partnerships, joint ventures, disposition of assets, debt
financings or restructurings, bank borrowings or other sources of
financing.  However, additional funding may not be available on
favorable terms or at all.  If additional funds are raised by
issuing equity securities, substantial dilution to existing
shareholders may result.  If the Company fails to obtain
additional capital when needed, the Company may be required to
delay, scale back, or eliminate some or all of its research and
development programs and may be forced to cease operations,
liquidate its assets and possibly seek bankruptcy protection.


BANK OCHRONY: Fitch Affirms Individual Rating at 'D'
Fitch Ratings has affirmed Bank Ochrony Srodowiska's (BOS) Long-
term Issuer Default Rating (IDR) at 'BBB' with a Stable Outlook.

BOS's IDRs and Support Ratings are based on Fitch's view that
support could be provided to the bank by the Polish state given
the quasi-governmental status of major shareholders and the
bank's significant role in financing environmentally-friendly
projects in Poland.  The IDRs also take into consideration the
fact that government control is through state-owned funds, rather
than as a result of direct ownership.

BOS is planning an SPO in 2012 (about PLN350 million) to fund
loan growth and Fitch understands that the current state-owned
shareholders will not participate in capital injections but will
retain a majority stake in BOS.  Fitch will reassess the impact
of the potential changes in BOS's shareholder and capital
structure on its view on support available to the bank after the
SPO is completed.

The Viability Rating reflects the bank's below average
profitability, risks embedded in its foreign-currency retail
mortgage book and the modest coverage of impaired loans.  This is
balanced by acceptable asset quality and capitalization as well
as a diversified funding base and moderate refinancing risks.

The bank's growth opportunities and loan performance could come
under pressure given a slowdown of the economy in 2012.  Fitch
notes that new wholesale funding raised this year (mainly EUR250
million Eurobonds), coupled with intensive deposit acquisition
have weakened the bank's margins.  However, the bank has improved
the currency and maturity profile of its funding base.

At end-Q311, BOS had around a 1.3% share of the total banking
sector's assets and deposits.  The bank's shares have been listed
on the Warsaw Stock Exchange since 1997.  At end-Q311, BOS was
about 97% indirectly owned by the state, with the National Fund
for the Protection of Environment and Water Resource Management
(NFOSiGW, fully state-owned) the majority shareholder (79.1%).

The rating actions are as follows:

  -- Long-term foreign currency IDR: affirmed at 'BBB'; Outlook
  -- Short-term foreign currency IDR: affirmed at 'F3'
  -- Viability Rating: bb
  -- Individual Rating: affirmed at 'D'
  -- Support Rating: affirmed at '2'
  -- Support Rating Floor: affirmed at 'BBB'


BANCO ESPIRITO: S&P Lifts Rating on Guaranteed Sr. Debt From 'BB'
Standard & Poor's Ratings Services raised its long-term issue
rating on government guaranteed senior debt issue of Portuguese
bank Banco Espirito Santo S.A. (BB/Negative/B) to 'BBB-' from
'BB' and placed the rating on CreditWatch with negative

"Due to an administrative error, the rating on the issue was
lowered at the time of our latest rating action on Banco Espirito
Santo S.A. on Dec. 16, 2011. Because the Republic of Portugal
(BBB-/Watch Neg/A-3) guarantees the issue, we rate it at the same
level as the long-term rating on the sovereign," S&P said.

Ratings List

Upgraded; CreditWatch Action
                                   To                  From
Banco Espirito Santo S.A.
EUR1.5 billion 3.75% guaranteed notes
due 01/19/2012*
                                   BBB-/Watch Neg      BB

*Guarantor: Republic of Portugal


FTPYME TDA: Fitch Affirms Rating on Series 3SA Notes at 'BBsf'
Fitch Ratings has downgraded FTPYME TDA Sabadell 2, FTA's series
1CA and 1SA notes and simultaneously removed them from Rating
Watch Negative (RWN).  Fitch has also affirmed the series 2SA and
3SA notes, as follows:

  -- EUR18,008,892 Series 1CA (ISIN: ES0339844005): downgraded to
     'AA-sf' from 'AAAsf'; Outlook Stable

  -- EUR24,405,344 Series 1SA (ISIN: ES0339844013): downgraded to
     'AA-sf' from 'AAAsf'; Outlook Stable

  -- EUR8,536,616 Series 2SA (ISIN: ES0339844021): affirmed at
     'BBBsf'; Outlook Stable

  -- EUR5,955,779 Series 3SA (ISIN: ES0339844039): affirmed at
     'BBsf'; Outlook Negative

The series 1CA and 1SA notes were originally placed on RWN on 6
October 2011 due to the transaction's exposure to Banco de
Sabadell ('BBB+'/RWN/'F2'), the swap counterparty.

Following the downgrade of Banco de Sabadell to below 'A'/'F1' on
June 29,2011, Fitch considered the bank ineligible for the role
of the swap counterparty and unable to support a note rating of
'AA-sf' or higher.  Additionally, Fitch expected remedial actions
outlined in the transaction documentation to be taken within 30
calendar days of Banco de Sabadell becoming ineligible.  Banco de
Sabadell continues to fulfill the role of swap counterparty while
no remedial actions have occurred to date.

According to the swap agreement, FTPYME TDA Sabadell 2, the
issuer, pays interest received on the performing collateral less
a margin of 0.50% to Banco de Sabadell, the swap counterparty.
In return, the issuer receives the weighted average coupon on the
notes.  The swap is beneficial to the transaction as the issuer
receives a net positive payment from the swap.

As a result of the lack of remedial actions, Fitch assessed the
materiality of the swap agreement to the transaction which led to
the downgrade of the two most senior series of notes.  The
Kingdom of Spain ('AA-'/Negative/'F1+') guarantees the timely
interest and principal payment of series 1CA notes.  However, as
the series 1CA notes can withstand the agency's 'AA-sf' rating
stress scenario without the benefit of the guarantor the agency
has assigned a Stable Outlook to these notes.

Since the last surveillance review in August 2011, current
default levels in the collateral portfolio have decreased to
EUR4.57 million from EUR4.72 million and account for 8.0% of
outstanding portfolio balance in the October 2011 investor
report.  Loans delinquent by more than 90 days have increased
significantly since the last review to EUR1.3 million from EUR0.4
million.  The 90+ delinquency rate 2.3% of the outstanding
balance while loans more than 180 days in arrears account for
1.2% of outstanding balance.  Overall, loans 180 days past due
have increased to EUR0.69 million from EUR0.13 million since the
last surveillance review.

The Negative Outlook for the class 3SA notes reflects their lower
position in the capital structure and greater sensitivity to
single obligor exposure.  Additionally, the transaction contains
significant exposure to real estate and construction industries
which currently accounts for 31% of the outstanding portfolio
balance.  Fitch considers these parameters, combined with the
agency's expectation that the transaction will amortize
sequentially in the near term due to a breach of the 90+
delinquency trigger, could expose the class 3SA notes to tail

FTPYME TDA SABADELL 2, FTA is a cashflow securitization of loans
to small and medium sized Spanish enterprises (SMEs) granted by
Banco de Sabadell.  The series 1CA notes are backed by a
guarantee from the Kingdom of Spain.

SACYR VALLEHERMOSO: Staves Default After Repsol Purchases Stake
Miles Johnson at The Financial Times reports that Sacyr
Vallehermoso, one of the driving forces behind Spain's decade
long construction bubble, has been saved from a last minute
default after oil group Repsol purchased EUR2.57 billion of its
own shares from the indebted builder.

Sacyr, which had been racing to refinance a EUR4.9 billion bank
loan used to buy 20% of Repsol at the top of the market, was left
with no other option but to sell half of its stake back to the
company at a discount ahead of Tuesday's deadline, the FT says.

Repsol, facing the possibility that Sacyr's lending banks would
seize the shares triggering a disorderly fire sale, said that it
preferred to use part of the EUR5.6 billion of cash on its
balance sheet to buy them, with the aim of selling them on to an
industrial investor, or remunerating shareholders.

Sacyr, which sold to Repsol at EUR21.06 a share, or a 5% discount
to Monday's close, as cited by the FT, said it had secured a
three year extension on the EUR2.3 billion remainder of the debt.

This would allow it to retain 10% of Repsol with the hope of
later erasing some of the EUR940 million in capital losses
already incurred on an investment made at an average price of
EUR26.7 a share, the FT states.

A late attempt by Sacyr, advised by Lazard, to sell half its
Repsol stake to China's Sinopec failed after time ran out to
tempt the state-controlled oil company to buy before the loan
expired this week, the FT recounts.

According to the FT, several banks, including Citigroup and
Credit Agricole, had demanded that Sacyr pay back all or some of
the loan, prompting Sacyr to hire advisers to find a buyer
willing to pay a premium over the market price for the holding.

It was not clear on Tuesday whether a small number of distressed
debt investors which purchased part of the loan in the open
market would be repaid alongside the dissenting banks, the FT

Sacyr Vallehermoso is a Spanish construction company based in

* VALENCIA REGION: Moody's Downgrades Debt Rating to 'Ba1'
Moody's Investors Service has downgraded the Region of Valencia's
debt rating by two notches to Ba1 from Baa2. At the same time,
the region's short-term debt rating has been downgraded to Not-
Prime from Prime-3. The ratings remain on review for downgrade.

The rating downgrades are based on Valencia's growing liquidity
problems, illustrated by the region's difficulties in refinancing
its retail bond issued in December 2010. The region's funding
problems have recently been exacerbated by the de-leveraging of
European banks and the closure of long-term capital market
funding for most Spanish sub-sovereigns.

In addition, the ratings of these government-related
issuers/issuances have also been downgraded:

- Instituto Valenciano de Finanzas: debt ratings downgraded to
   Ba1 from Baa2, in line with the Generalitat de Valencia's
   downgrade; rating under review for downgrade.

- Notes of CACSA and Universities of Valencia (Universidad de
   Valencia, Universidad de Alicante, Universidad Jaume 1 de
   Castellon and Universidad Politecnica de Valencia): downgraded
   to Ba1 from Baa2; rating on review for downgrade.

- Notes of Feria Valencia: underlying rating downgraded to Ba1
   on review for downgrade from Baa2 negative (A and B
   Certificates); the rating of Feria Valencia's notes remains at
   Aa3/negative, in line with the financial guarantee provided by
   Assured Guarantee (Europe) Ltd (formerly, Financial Security
   Assurance (UK) Ltd).


Although Moody's recognizes that the Region of Valencia's
solvency remains acceptable despite some recent deterioration,
the region's growing liquidity problems have become more
pronounced in the last few months due to wider market confidence
problems in the euro area. As a result, Valencia's recourse to
short-term funding has weakened, increasing refinancing risk in
the short term. In its assessment of the region's liquidity
position and overall creditworthiness, Moody's believes that the
region displays the following characteristics that are no longer
compatible with an investment-grade rating:

(i) The region is facing large and concentrated debt repayments
in the next 12 months. These include EUR1.8 billion this month
and around EUR2.3 billion in 2012 (or 20% of its operating

(ii) The region's extensive use of short-term credit lines, of
which only 19% was available for drawdown at the end of November
2011. In light of the region's expected large cash outflow in
December -- double its payroll being paid this month -- Moody's
anticipates that the region will be left with a limited amount of
unused credit facilities by the end of the year. Moreover, the
region's reliance on bank lines has increased further due to
little investor appetite for Valencia's Euro Commercial Paper
Programme, where debt outstanding decreased to EUR68 million from
EUR1.3 billion two years ago.

(iii) With approximately EUR1.0 billion subscribed, the retail
bond issuance launched to refinance the region's large debt
repayments in December will not be sufficient. This will force
the region to urgently negotiate additional funding facilities
with the banks.


During the review, Moody's will monitor Valencia's progress and
cost of refinancing and its impact on the region's overall debt
profile. Moreover, the rating agency will focus its review in
assessing the region's ability to ensure sustainable funding over
time, including any potential supportive measures initiated by
the central government.

Finally, Moody's will assess the region's progress towards fiscal
consolidation in order to limit the region's deficit for 2011-12.
In particular, Moody's will monitor the evolution of the region's
commercial debt, which could lead to a deterioration in the
region's credit profile if increased significantly.


The methodologies used in this rating were Regional and Local
Governments Outside the US published in published in May 2008,
and The Application of Joint Default Analysis to Regional and
Local Governments published in published in December 2008.

Moody's methodology for rating a security insured by a financial
guarantor considers the higher of: (i) the guarantor's rating;
and (ii) the underlying rating of the security.


SAAB AUTOMOBILE: Pang Da Halts Bid; Breakup Looms
Melanie Lee at Reuters reports that China's Pang Da Automobile
Trade said on Wednesday it would halt its attempt to acquire Saab
Automobile in light of the Swedish carmaker's bankruptcy.

Saab was declared bankrupt by a court on Monday, ending a nine-
month survival battle by its Dutch owner, Reuters recounts.

"In view of Saab being declared bankrupt, Pang Da Automobile
Trade has decided to stop the acquisition transaction of Saab,"
Reuters quotes Pang Da as saying in a statement to the Shanghai
stock exchange.

Pang Da said in the statement that it would follow relevant
procedures to try and retrieve the EUR45 million (US$59 million)
advance it had given to Saab, but warned that it may not be
successful, Reuters relates.

Dow Jones' Daily Bankruptcy Review reports that Victor Muller,
the chief executive of Saab, insists there's hope for the Swedish


Ola Kinnander at Bloomberg News reports that Saab Automobile's
assets may be broken up and sold to pay debt as the unprofitable
Swedish company ends more than six decades of carmaking following
a bankruptcy filing.

Bloomberg relates that parent company Swedish Automobile NV said
in a statement on Monday that Saab Auto submitted the application
at Vaenersborg District Court after a potential Chinese partner
wasn't able to provide funding while General Motors Co., a former
owner, said it would block the proposed tie-up.

The court said in an online statement that it accepted the
petition and appointed two Gothenburg, Sweden-based attorneys,
Hans Bergqvist and Anne-Marie Pouteaux, as administrators,
Bloomberg discloses.

Mr. Muller said that he received "two or three" expressions
of interest on Monday from potential buyers, and that he'll refer
them to the bankruptcy administrator that the court appoints.

The Swedish carmaker's production lines have been largely
suspended since March as the company fell behind on paying
suppliers, Bloomberg recounts.


Meanwhile, Detroit News' David Shepardson reports that General
Motors Co. said Tuesday it will extend warranty coverage to
owners of thousands of Saab vehicles sold before February 2010,
while Saab's North American board met to decide its next steps.

Saab North America, which is based in Royal Oak and has about 50
employees, said it is halting warranty coverage on current
vehicles and models for sale at dealerships in the wake of
Monday's bankruptcy filing by its parent Saab Automobile AB in
Sweden, Detroit News discloses.

Detroit News relates that Saab spokeswoman Michele Tinson said
the company has also stopped dealer incentive payments for
vehicles at showrooms.  Only a few thousand Saab vehicles are at
its 188 U.S. dealer showrooms, Detroit News notes.

According to Detroit News, GM spokesman Jim Cain said GM is
working to notify Saab customers that it will step in.

GM, as cited by Detroit News, said that Saab has about 48,000
vehicles registered in the United States.  Most of those would be
covered by GM's warranties, Detroit News says.

GM sold Saab to Dutch luxury automaker Spyker in February 2010,
one of four brands it off-loaded in bankruptcy, Detroit News

As reported by the Troubled Company Reporter-Europe on Dec. 20,
2011, Bloomberg News related that Saab won protection from
creditors in September and has been seeking funding since then.
Guy Lofalk, Saab's court-appointed administrator, applied on
Dec. 7 to end the reorganization, saying the carmaker was out of
money and had no realistic hope of gaining financing soon,
Bloomberg recounted.  Mr. Muller said on Dec. 7 that Saab
Automobile was in talks with Jinhua, China-based Zhejiang
Youngman Lotus Automobile and a Chinese bank to secure about
EUR600 million in loans, Bloomberg related.  GM, which retains a
say in Saab's future because of the companies' technology ties,
said Dec. 17 that it couldn't support proposed alternatives as
they "are not meaningfully different" from previous plans the
Detroit-based carmaker had rejected on the grounds they would
hurt the U.S. company, Bloomberg noted.  There is still a
possibility for Saab to be rescued in one piece if a "viable
investor" steps in.  Mats Faegerhag, Saab's product
development chief, as cited by Bloomberg, said "But that would
have to happen quick, in a few weeks, because our employees will
be looking for other jobs."

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


MORYE: Crimean Court Extends Bankruptcy Procedure Through Jan. 2
---------------------------------------------------------------- reports that a Crimean court extended a
bankruptcy procedure for Morye, which is in the middle of
implementing US$350 million contract for China.

The Crimean Economic Court extended the procedure through
January 2, 2013, relates.  The ruling was
issued on December 14, discloses. notes that Interfax said the court also
extended powers of the manager -- Morye shipyard director general
Vitaliy Kryvenko -- and powers of property manager Roman

Morye is a Feodosia-based shipyard.

U N I T E D   K I N G D O M

CLEARY DOYLE: NAMA Places Firm Into Receivership
The Irish Times reports that Cleary Doyle blamed collapsing land
values, falling revenues and the failure of some clients to pay
it for National Asset Management Agency (NAMA)'s decision to
place it in receivership.

"Like other construction businesses, we have been severely
affected by the unprecedented impairment in land and property
values.  This has been compounded by unpaid debts as a result of
client receiverships and liquidations," the report quoted the
group as saying.  "These problems have been further exacerbated
by the problems arising from the falling workload in public and
private contracting and the stalled property sector," the company
added, The Irish Times relates.

Cleary Doyle is a Wexford building group.

COVENTRY & RUGBY: S&P Affirms 'BB+' Rating on GBP407.2-Mil. Bonds
Standard & Poor's Ratings Services affirmed its 'BB+' long-term
issue rating on the GBP407.2 million senior secured bonds due
2040 issued by U.K.-based special-purpose vehicle The Coventry &
Rugby Hospital Co. PLC (CRH). "At the same time, we removed the
issue rating from CreditWatch, where it was placed with negative
implications on Aug. 24, 2011. The outlook is stable," S&P said.

The bonds retain an unconditional and irrevocable guarantee of
payment of scheduled interest and principal provided by monoline
insurer MBIA U.K. Insurance Ltd. (MBIA U.K.; B/Negative/--).
Under Standard & Poor's criteria, a rating on monoline-insured
debt reflects the higher of the rating on the monoline and
Standard & Poor's underlying rating (SPUR). In this case, the
rating on the bonds reflects the SPUR, as it is higher than the
current rating on MBIA U.K.

The affirmation follows CRH's appointment of Vinci Facilities
(VF) as the new hard facilities management (FM) services provider
to the hospital facilities in Walsgrave, in the West Midlands,
from Dec. 1, 2011.

VF's appointment follows a review of the position of Skanska
Facilities Services (SFS), the previous hard FM services
provider, by CRH and University Hospitals Coventry and
Warwickshire National Health Service Trust (UHCWT). This review
was prompted by a significant service failure involving a
pathology lab that failed its annual verification test early this
year. SFS did not immediately inform either CRH or UHCWT about
this failure.

"We understand that while the services provided by VF are exactly
the same as those provided by SFS, VF's annual fee is lower. In
addition, from 2026, the annual fee will be escalated at the rate
of the retail prices index (RPI), rather than RPI plus 1% as is
the case until 2026, and as was the case with SFS' fee throughout
the concession. These savings will flow largely to CRH over the
remaining life of the concession. We have not yet received an
updated financial model from CRH incorporating these changes.
However, we have attempted to replicate the effect of the savings
by incorporating our own adjustments into the last model update
from June 2011 to reflect our understanding of the new agreement.
Although the savings are cumulatively meaningful, we do not
anticipate that overall, they will have a significant bearing on
the project's forecast annual debt service coverage ratios," S&P

Under a private finance initiative, CRH used the bond proceeds to
design, build, equip, and maintain hospital facilities at
Walsgrave under a 40.2-year concession agreement with UHCWT and
Coventry Teaching Primary Care Trust. The latter's obligation has
since been transferred to the Coventry and Warwickshire
Partnership Trust.

"We could lower the rating if the relationships between the
project's participants deteriorate materially; if service failure
points rise significantly; or if warning notices are issued.
Downward pressure could also arise if the project's financial
profile comes under pressure from an escalation in costs or
reduced income, such as materially lower interest income than
presently forecast," S&P said.

"We could take a positive rating action if the project's
financial profile improves materially, such as through the
realization of significant reductions in costs or expenditures
that do not have a substantially negative bearing on service
provision or on the condition of the estate," S&P said.

CUMBRIAN SEAFOOD: Jobs at Fish Factory Under Threat
Matthew Legg at News&Star reports that more than 100 jobs at
Cumbrian Seafood Limited's west Cumbrian fish factory remain
under threat despite the company being rescued from
administration two weeks ago.

As reported in the Troubled Company Reporter-Europe on Dec. 7,
2011, The Northern Echo said that Cumbrian Seafood has been
acquired by a unit of Lion Capital, the owner of Young's Seafood
Limited, out of administration.  The company went into
administration on the morning of Dec. 5 and was immediately
bought in the evening, according to The Northern Echo.  The
report related that administrators confirmed that Cumbrian
Seafood's business, customer contracts and equipment were sold to
Lion Capital's subsidiary.

However, the report notes, that Young's has since admitted it has
yet to decide on the future of the site or its sister operations
in Seaham, County Durham, and Amble, in Northumberland.
News&Star relates that the firm is currently assessing options,
which could include transferring work away from those centers to
other sites in the Young's empire.

Seaham-based Cumbrian Seafood Limited is a seafood supplier.  The
firm employs 378 people at Seaham, while the two remaining sites
in Whitehaven, Cumbria and Amble, Northumberland employ 117 and
79 respectively.

HEALTHCARE LOCUMS: Set to Appoint New Advisors
Jonathan Russell at The Telegraph report that Healthcare Locums
is to announce a clear out of its professional advisors.

The company is to reveal new auditor, lawyer and nominated
advisor and broker.  Auditor BDO is in line to be replaced by
Deloitte, the Telegraph discloses.  Either Numis Securities or
Investec are being lined up to replace current broker and
nominated advisor Fairfax and it is understood a senior City law
firm will replace Lawrence Graham, according to the Telegraph.

The overhaul of the company's advisors comes almost a year after
HCL suspended trading in its shares after uncovering "serious
accounting irregularities," the Telegraph notes.  Founder and
executive vice chairman Kate Bleasdale and finance director Diane
Jarvis were immediately suspended, the Telegraph discloses.
Ms. Bleasdale was later sacked, the Telegraph recounts.

According to the Telegraph, the fall out from the problems at HCL
has led to a widespread investigation by the Accountancy and
Actuarial Discipline Board.

The AADB is looking into work carried out by BDO and three
qualified accountants, including Ms Jarvis, who sat on the HCL
board, the Telegraph says.  The investigation will look at how
incorrect accounts were used to negotiate a GBP130 million
refinancing with two Australian banks in 2010, the Telegraph

Shares in HCL were suspended in January at 112p, the Telegraph
recounts.  Trading resumed in September after an emergency
refinancing, the Telegraph relates.

As reported by the Troubled Company Reporter-Europe on Oct. 4,
2011, The Financial Times related that Healthcare Locums restated
profit figures for a disputed six-month period in 2010.  The Aim-
quoted company last year reported interim pre-tax profits of
GBP6.8 million for the first half of 2010, the FT disclosed.
The FT noted that in September 2011, that figure was revised to
GBP3.5 million "in order to comply with accounting policies".

Healthcare Locums is a UK-based medical recruitment agency.

NORTHERN ROCK: S&P Raises Rating on Tier One Notes to 'BB+'
Standard & Poor's Ratings Services raised the rating on the
7.053% callable perpetual Tier One Notes (TONs) issued by
Northern Rock (Asset Management) PLC (NRAM; A/Stable/A-1) to
'BB+' from 'C'. This rating action follows the completion of the
tender offer launched on Nov. 16, 2011 by NRAM and Bradford &
Bingley PLC (B&B; --/--/A-1) for 16 of their Tier 1 and Tier 2
issues, including the TONs. The counterparty credit ratings on
NRAM and B&B are unaffected, as are the issue ratings on their
other bonds.

"On Nov. 18, 2011, we said that we viewed the tender offer for
the TONs as 'distressed' under our criteria, and we accordingly
lowered the issue rating on the TONs to 'C' (see 'Northern Rock
(Asset Management) PLC Tier One Notes Lowered To 'C' On Announced
Tender Offer'). We said that we would review this issue rating
following completion of the tender offer if any TONs remained
outstanding," S&P said.

On Dec. 15, 2011, NRAM announced that it had accepted all
GBP79.751 million in aggregate principal amount of TONs tendered
for purchase under the offer. Following this purchase, the
principal amount of TONs outstanding is GBP30.674 million.

"We have reviewed the issue rating on the remaining TONs in light
of the completion of the tender offer, and have decided to raise
it to 'BB+'. In line with our criteria for hybrid instruments,
this rating level is two notches below NRAM's 'bbb' stand-alone
credit profile. The rating reflects our view that NRAM is likely
to continue to pay TONs coupons for the foreseeable future
because we understand that they are deferrable only if NRAM
breaches its minimum regulatory capital requirement. We also note
that the tender offer has increased NRAM's equity base, which is
junior to the TONs, and reduced the outstanding amount of dated
subordinated debt, which is senior to the TONs. Nevertheless, we
continue to see material uncertainty regarding NRAM's ability to
repay perpetual subordinated obligations such as the TONs in full
when the wind down of its balance sheet has been concluded. We
expect that this wind down process will take many years to
complete," S&P said.

Ratings List
                                 To                  From
Northern Rock (Asset Management) PLC
GBP30.674 mil. 7.053% callable perp core tier one nts hybrid
                                 BB+                 C

PADDINGTON HOUSE: Goes Into Administration, Seeks Buyer
This is Cheshire News reports that Paddington House Hotel has
gone into administration and with administrators from Baker Tilly
were appointed to sell the last month, along with two partner
hotels in Salford and Chester.

Bosses say it is continuing to trade but joint administrator
Russell Cash said it is unlikely the bill will be paid, according
to This is Cheshire News.

The report notes that the company has owed numerous suppliers.

"It is unlikely that there will be any funds available to pay a
dividend to unsecured creditors in this case.  All suppliers who
are continuing to support the continued trading strategy will be
paid for all orders placed by the administrators.  We are
continuing to trade each of the hotels, have received a number of
expressions of interest and are hopeful of achieving going
concern sales in the New Year," the report quoted Mr. Cash as

WEDGWOOD MUSEUM: To Sell Collection to Plug GBP134MM Shortfall
The Sentinel reports that a High Court judge has ruled that the
Wedgwood Museum 10,000-piece collection is not held by the
Barlaston museum in trust and can be sold off to help plug a
GBP134 million pension fund shortfall.

Members of the Wedgwood family and museum trustees say they are
"devastated" and have vowed to mount a campaign to make sure it
can be kept on public display, according to The Sentinel.

The report recalls that the museum went into administration in
April 2010 after being hit with a GBP134 million claim from
Wedgwood Group Pension Plan.  The Sentinel recalls that when
Wedgwood itself went into administration the previous year, it
was thought the scheme would be taken over by the Pension
Protection Fund.

However, the report relates that the PPF could not accept it as
there is still a surviving solvent organization connected to the
scheme -- the Wedgwood Museum.

Administrators for the museum, Begbies Traynor, sought a High
Court ruling to determine the collection's future, The Sentinel

The report relates that the court was told the collection is
worth between GBP11.5 million and GBP18 million which falls well
short of the GBP134 million fund deficit.

Administrators will now wait to see if the Attorney General
appeals against the decision, but Bob Young, from the firm's
Caverswall office, said there are options that could keep the
collection together at Barlaston, the report adds.

* UK: Consumer Sector Insolvencies Expected to Rise
Louise Lucas and Claer Barrett at The Financial Times report that
cash-strapped Brits' reluctance to spend is set to push a record
number of shops, food manufacturers and gyms over the edge next
year -- triggering a downward spiral of more job losses that will
crimp spending further.

One in five businesses in food manufacturing, and the hospitality
and tourism industries is on insolvency alert, according to
accountancy firm RSM Tenon's analysis of Companies' House data,
as well as one in eight retailers, the FT discloses.

Alan Hudson, head of restructuring for UK and Ireland at Ernst &
Young, believes the number of insolvencies next year will exceed
2008, the peak year to date, the FT relates.

"A lot of businesses that have been supported are now struggling
to perform.  With a further downturn, a lot of these zombie
companies are going to find it increasingly difficult to
survive," the FT quotes Mr. Hudson as saying.

He points to pressures on the cost side -- wage inflation, higher
utility bills and property costs -- as well as consumer
thriftiness, the FT notes.

Retailers' pain is exacerbated by the UK's skewed policy on
rents, the FT states.  Shopkeepers also suffer from tortuously
long supply chains, according to the FT.

Among leisure companies, the most vulnerable are those exposed to
the consumer slowdown in the provinces, where the brunt of the
government's austerity measures are being felt, the FT states.

UK hotels with exposure in the provinces face a particularly
tough 2012, the FT discloses.  HVS, the leisure consultancy, has
warned that it is "vital" for hotel groups to find new sources of
debt funding, the FT notes.

"Banks with loans that need refinancing will either continue to
'extend and pretend' or lose patience and force a sale, possibly
via insolvency," the FT quotes Tim Smith, director of HVS, as

Other retailers avoid administration by using a CVA to close
stores and reduce costs, the FT notes.

Merger and acquisition opportunities for distressed companies are
limited, according to the FT.  Private equity buyers are
struggling to obtain debt and cross-border deals are expected to
falter in the face of the eurozone crisis, the FT discloses.


* EUROPE: Almunia Warns of More Bank Restructurings in 2012
Dow Jones' Daily Bankruptcy Review reports that bank
restructuring cases won't decline in 2012 and the European Union
will continue to face a heavy workload in clearing them by its
new rules on state aid for the bailout of financial institutions,
Joaquin Almunia, the EU competition commissioner said.

* EUROPE: Plans for Failing Banks Expected in 2012, Barnier Says
Jones Hayden at Bloomberg News reports that European Union
Financial Service Commissioner Michel Barnier said plans for
failing banks probably will be tabled at the beginning of 2012.

* EUROPE: Moody's Says Outlook on 2012 CLOs Negative
US collateralized loan obligations (CLOs) issued in 2012 will
have a strong credit profile, according to a new report from
Moody's Investors Service. Moody's has a stable outlook for the
performance of outstanding US CLOs and a negative outlook for the
performance of European CLOs. New issuance of CLOs in 2012 will
continue to originate primarily in the US because of challenging
economic conditions in Europe.

Features in new US CLOs will offer more protection for debt
investors than did features in pre-credit crisis transactions;
hence, post-crisis CLO structures will better withstand another
downturn. "This increased protection includes strong
subordination, tight investment constraints, and enhanced
documentation provisions, which Moody's expects will mirror the
attributes of typical 2011 US CLOs," says Moody's Senior Vice
President Danielle Nazarian.

Moody's stable outlook for outstanding US CLOs reflects a low
corporate default rate forecast and stable to positive rating
outlooks for speculative-grade issuers. US leveraged loan issuers
have significantly improved their balance sheets and pushed back
loan maturity schedules, supporting a stable outlook for the
primary collateral backing CLOs. Nonetheless, while the risk of
recession in the US remains low, continued stress in the euro
area and high volatility in the financial markets will tighten
funding for leveraged loan issuers, presenting moderate downside
risks to US CLO performance.

The outlook for outstanding European CLOs is negative primarily
because of the rising risk of recession in the euro area. "The
European sovereign debt crisis has tightened funding from the
financial markets, increasing refinancing risk for speculative-
grade companies, and particularly for companies with ratings at
B3 or below. This will negatively affect European CLO
collateral," says Moody's Vice President Guillaume Jolivet.

However, a number of positive factors help mitigate the risk to
CLOs of the European sovereign debt crisis. CLOs continue to
deleverage at a fast pace as more than half of the outstanding US
CLOs and European CLOs will be in their amortization periods by
the end of 2012. Additionally, built-in cash flow diversion
mechanisms in CLOs will further offset potential performance
deterioration by triggering deleveraging.

* Upcoming Meetings, Conferences and Seminars

April 3-5, 2012
     TMA Spring Conference
        Grand Hyatt Atlanta, Atlanta, Ga.

Apr. 19-22, 2012
     Annual Spring Meeting
        Gaylord National Resort & Convention Center,
        National Harbor, Md.
           Contact: 1-703-739-0800;

July 14-17, 2012
     Southeast Bankruptcy Workshop
        The Ritz-Carlton Amelia Island, Amelia Island, Fla.
           Contact: 1-703-739-0800;

Aug. 2-4, 2012
     Mid-Atlantic Bankruptcy Workshop
        Hyatt Regency Chesapeake Bay, Cambridge, Md.
           Contact: 1-703-739-0800;

November 1-3, 2012
     TMA Annual Convention
        Westin Copley Place, Boston, Mass.

Nov. 29 - Dec. 2, 2012
     Winter Leadership Conference
        JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
           Contact: 1-703-739-0800;

April 10-12, 2013
     TMA Spring Conference
        JW Marriott Chicago, Chicago, Ill.

October 3-5, 2013
     TMA Annual Convention
        Marriott Wardman Park, Washington, D.C.


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

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  Go to 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.

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