TCREUR_Public/111229.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 29, 2011, Vol. 12, No. 258



SCANDINOTES V: Moody's Cuts Rating on DKK672MM Notes to 'Caa3'


NOVASEP HOLDINGS: Moody's Affirms 'Ca' Corporate Family Rating
TECHNICOLOR: Moody's Maintains 'B3' Corporate Family Rating


DEUTSCHE LUFTHANSA: Moody's Ba1 Ratings Unaffected by bmi Sale
* GREECE: Lenders Resist IMF Pressure to Accept Bigger Losses


* HUNGARY: Mandatory Liquidations Up 16% in 2011, Opten Says
* HUNGARY: Defends Economic Management After Rating Downgrade


MANSFIELD GROUP: BoSI Secures EUR214-Mil. Judgment Against Owner


BANCA MONTE: Shareholder Reaches Standstill Deal with Creditor
IXFIN SPA: Commission Refers Italy to Court Over Incompatible Aid


* MOLDOVA: Moody's Issues Summary Credit Opinion


PARPUBLICA-PARTICIPACOES: Moody's Maintains 'B1' Long-term CFR


CHELYABINSK OBLAST: S&P Affirms 'BB+' Issuer Credit Rating
SOVCOMFLOT JSC: Moody's Cuts Corporate Family Rating to 'Ba1'
TAGANROG MOTOR: Court Postpones Bankruptcy Hearing Until Dec. 30


NOVA LJUBLJANSKA: Moody's Downgrades Deposit Ratings to 'Ba1'
* SLOVENIA: Moody's Cuts Credit Rating on Banking System Concerns


SAAB AUTOMOBILE: U.S. Unit Taps Administrator to Run Biz

U N I T E D   K I N G D O M

LADBROKES PLC: Moody's Maintains 'Ba2' Corporate Family Rating
RANK GROUP: Moody's Maintains 'B1' Long-term Corp. Family Rating
* UK: Four Out of Ten AIM Companies in "Poor Financial Health"


* EUROPE: ECB Provides Low-Interest Loans to Euro-Zone Banks
* Upcoming Meetings, Conferences and Seminars



SCANDINOTES V: Moody's Cuts Rating on DKK672MM Notes to 'Caa3'
Moody's Investors Service has downgraded the ratings of these
notes issued by ScandiNotes Five p.l.c.:

Issuer: ScandiNotes Five p.l.c.

   -- DKK218,100,000 Class A Floating Rate Limited Recourse
      Secured Senior Notes due 2015, Downgraded to Ba3 (sf);
      previously on Mar 16, 2011 Confirmed at Baa3 (sf)

   -- DKK672,000,000 Class B Floating Rate Guaranteed Limited
      Recourse Secured Senior Notes due 2015, Underlying Rating:
      Downgraded to Caa3 (sf); previously on Mar 16, 2011
      Downgraded to Caa2 (sf)

ScandiNotes Five p.l.c., issued in December 2007, is a static
cash CDO backed by a highly non-granular portfolio of
subordinated loans made to Danish commercial and savings banks.
All the loans in the portfolio have the flexibility to redeem at
the five year call option in December 2012. Should they choose
not to redeem, the underlying loans will be subject to an
increase in the coupons paid.

Ratings Rationale

The rating downgrades reflect the significant credit
deterioration in the underlying portfolio as well as the
occurrence of default of Max Bank in October 2011. The
deterioration is reflected in the change in the weighted average
credit quality of the pool from B2 to Caa1 (excluding defaulted
assets). Max Bank had an exposure of DKK100 million which
represented about 9% of the outstanding portfolio. Currently
there are 11 loans totalling DKK1,050 million remaining in the

Following the default of Max Bank the overcollateralization
ratios of both Class A and Class B have deteriorated. The
overcollateralization ratio of Class A was 572.3% (excluding the
final swap payment) in the last rating action in March 2011 as
compared to 481.4%. The ratio of Class B has decreased from
129.2% to 118.0% since the last action.

The Class B and C notes are guaranteed by the European Investment
Fund (EIF). Following the default of Max Bank, the notional
amount of Class C without the EIF guarantee has been written down
to DKK213,657,414 from DKK308,190,527 as reported in the last
rating action in March 2011 (initial notional amount was DKK
417.9 million). Due to this writedown, Moody's is retaining the
underlying rating of Class C at Ca which is consistent with the
Moody's expected recoveries for the notes, as outlined in the
paper titled Moody's Approach to Rating Structured Finance
Securities in Default" (November 2009).

At closing, the assets were referenced via an asset swap with HSH
Nordbank AG as the counterparty. Using this mechanism, Classes C
and D were issued at discount paying a reduced fixed coupon. The
difference between the notional amount and the issue price was
due to be paid to the noteholders by way of a final payment from
the asset swap that expires in December 2012 at the same time as
the call options on the underlying loans. After the expiry of the
swap, there remains a floor in place to mitigate the interest
risk between the floating rate assets and fixed liabilities on
Classes C and D, though it is now only relevant to Class C due to
the total write down of Class D. When defaults occur on the
underlying assets, the amount of the fixed notional of the swap
that is written down is determined by the current interest rates
at the time the swap is written down.

All the loans in the portfolio are assessed by credit estimates.
In the base case scenario Moody's stressed the default
probability of the pool by a factor of 30% in order to capture
the increased rate of default. The stressed weighted average
default probability of the pool was 50.9% in its base case.

Moody's also considered various additional scenarios, which
include defaulting all the loans with Caa2 or lower credit
estimates or assuming the four obligors with better credit
quality repaying at the five-year call option in December 2012 to
redeem the notes. In these scenarios, model outputs deviate less
than one notch from the base case scenario.

The credit assessment of the portfolio reflects the difference in
performance between senior and more junior debt since the
beginning of the crisis, incorporating Moody's analytical
framework on subordinated debts (see press release titled
"Moody's Reviews Bank Hybrids, Subordinated Debt for Downgrade",
18 November 2009), whereby the Baseline Credit Assessments of the
issuing banks have been notched down by two notches to account
for the subordinated nature of the loans in the pool.

Because the portfolio references a low number of generally small
Danish banks and concerns surrounding the Danish banking
industry, Moody's believes the likely correlation in defaults
between issuers in the pool is likely to be high. Correlation was
assumed to be 50% for the base case, though a stress case of 75%
was also looked at which had about 1.5 notch negative impact
compared to the base case output.

Recoveries on the subordinated loans in the event of default were
assumed to be zero.

Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, which could negatively impact the
ratings of the notes, as evidenced by uncertainties of credit
conditions in the general economy.

As noted in Moody's comment 'Rising Severity of Euro Area
Sovereign Crisis Threatens Credit Standing of All EU Sovereigns'
(November 28, 2011), the risk of sovereign defaults or the exit
of countries from the Euro area is rising. As a result, Moody's
could lower the maximum achievable rating for structured finance
transactions with meaningful exposure to some of these countries.

Sources of additional performance uncertainties include:

1) Low portfolio granularity: the performance of the portfolio
depends to a large extent on the credit conditions of a few large
obligors that are estimated low non investment grade.

2) Moody's believes the correlation in defaults between issuers
in the pool will probably be high, with the consequence that
remaining performance outcomes of the notes are likely to be
binary in nature.

3) The majority of the portfolio consists of loans whose credit
quality has been assessed through Moody's credit estimates.
Further information regarding specific risks and stresses
associated with credit estimates are available in the report
titled "Updated Approach to the Usage of Credit Estimates in
Rated Transactions" published in October 2009.

The methodologies used in this rating were "Moody's Approach to
Rating Corporate Collateralized Synthetic Obligations" published
in September 2009, and "Moody's Approach to Rating Collateralized
Loan Obligations" published in June 2011.

Under these methodologies, Moody's modelled the transaction using
a bespoke CDOROM(TM) and cash flow model in order to capture the
specific characteristics of the transaction, incorporating the
assumptions contained in the above methodologies. Moody's
CDOROM(TM) was used to simulate the default for each asset in the
portfolio. Losses on the portfolio derived from those scenarios
have then been applied as an input in the cash flow model to
determine the loss for each tranche. In each scenario, the
corresponding loss for each class of notes is calculated given
the incoming cash flows from the assets and the outgoing payments
to third parties and noteholders. By repeating this process and
averaging over the number of simulations, an estimate of the
expected loss borne by the notes is derived. Moody's CDOROM(TM)
relies on a Monte Carlo simulation which takes the Moody's
default probabilities as an input. Each portfolio is modelled
individually with a standard multi-factor model reflecting
Moody's asset correlation assumptions. The correlation structure
implemented in CDOROM is based on a Gaussian copula.

In addition, Moody's supplemented the runs by using solely CDOROM
to model the cash flows and determine the loss for each tranche.

As such, Moody's analysis encompasses the assessment of stressed

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, 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.


NOVASEP HOLDINGS: Moody's Affirms 'Ca' Corporate Family Rating
Moody's Investors Service has affirmed the corporate family
rating (CFR) of Ca and probability of default rating (PDR) of D
of Novasep Holding SAS, following the company's announcement of
the signing of an agreement to restructure its debt.
Concurrently, Moody's has affirmed at Ca the ratings on Novasep's
EUR270 million and US$150 million worth of senior secured notes
and changed the outlook on the ratings to positive from stable.

Ratings Rationale

"The affirmation of Novasep's ratings follows the company's
announcement on December 15, 2011 that it has executed a
consensual restructuring agreement with holders of more than 90%
of the aggregate principal amount of its notes," says Marie
Fischer-Sabatie, a Moody's Vice President -- Senior Credit
Officer and lead analyst for Novasep. "If the transaction
proceeds, it will constitute a distressed exchange, which is an
event of default under Moody's definition of default," adds Ms.

Assuming 100% acceptance from bondholders, Moody's estimates that
post-restructuring, Novasep's leverage (debt/EBITDA) would be
between 5.0x and 6.0x (including Moody's adjustments). The
material reduction in interest payments post-restructuring would
also greatly enhance Novasep's cash flow generation, although in
2012 the company may still find it challenging to achieve
positive free cash flow. After the closing of the debt
restructuring, Moody's estimates that Novasep's CFR could move
towards Caa1, depending on its liquidity profile at that time and
evidence that operations have stabilized. This also assumes no
material change to the current strategy and business profile of
the company and that it will undertake no material debt-financed

In its announcement on December 15, 2011, Novasep explained that
the holders of its notes would receive 97.7% of the common equity
securities in the company. Novasep also stated that its
outstanding notes would be reduced to EUR150 million equivalent
from approximately EUR415 million equivalent (including accrued
interests), and its cash interest expenses to EUR12 million
equivalent per annum from approximately EUR40 million. In
addition, the company revealed that the Fonds Strategique
d'Investissement would inject liquidity of EUR30 million in the
form of preferred shares and the existing shareholder Azulis
would provide EUR3 million of equity.

The change of outlook to positive reflects the increased
likelihood that the company will restructure its debt within the
next months, which would result in an improved financial profile,
following the signing of a restructuring agreement with more than
90% of the holders of its notes.

Moody's would expect Novasep's liquidity profile to improve
following the completion of its debt restructuring, both through
the liquidity injection of EUR33 million into the company and the
significant reduction in its interest burden. However, with no
bank facility available to the company, its liquidity profile is
dependent upon its ability to generate free cash flow on a
sustainable basis.


Novasep is currently in default. Further downward pressure on the
CFR could only develop if Moody's were to materially revise
downwards the estimated recovery. Conversely, upward pressure
could develop if Novasep were to complete the restructuring of
its debt, resulting in a material reduction in the company's debt
level and leverage.

Principal Methodology

The principal methodology used in rating Novasep Holding SAS was
the Global Business & Consumer Service Industry Rating
Methodology, published October 2010. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA, published June 2009.

Novasep, headquartered in Pompey, France, is a leading provider
of contract manufacturing services for life science industries
and a manufacturer of purification equipment. Novasep reported
revenues of EUR302 million in 2010.

TECHNICOLOR: Moody's Maintains 'B3' Corporate Family Rating
Moody's Investor's Service changed the outlook on Technicolor's
ratings to negative from stable. The B3 corporate family rating
and probability of default rating remain unchanged.

Outlook Actions:

   Issuer: Technicolor S.A.

   -- Outlook, Changed To Negative From Stable

Ratings Rationale

The rating action was triggered by Technicolor's recent profit
warning indicating that Technicolor will fail to achieve the
targeted EBITDA for 2011 of EUR505 million by c. EUR30 million
and that further restructuring is considered necessary. This
development will lead to tightening headroom under the company's
financial covenants. In addition, it will be challenging for
Technicolor to reach a leverage below 4.5x Debt/EBITDA (as
adjusted by Moody's) for 2011 and 2012, which is the threshold to
maintain the current B3 rating and it is in contrast to Moody's
previous expectations.

The B3 rating continues to balance a business profile that is
strongly benefitting from reliable royalties from the technology
portfolio with (i) the continuing strong dependence of the group
on a steady stream of licensing income from its Technology
division for profitability and cash flow, (ii) still challenging
operating performance with strong seasonal swings and therefore
low visibility, (iii) continuously weak contribution from its
Digital Delivery Group and additional restructuring measures
related to it, (iv) the risk of additional measures of portfolio
optimization to improve the balance of the cash flow
contributions of the segments and (v) the tightening headroom
under the company's financial covenants.

While Technicolor was able to materially improve its key credit
metrics during H1 2011 the quarterly split indicated a 14.6%
revenue decline (y-o-y) at Digital Delivery for Q2. Given the low
profit contribution of this segment (accounting for EUR55 million
co. adjusted EBITDA in 2010, only -- compared to EUR505 million
for the group) and its low margin (reported EBITDA margin of 4%
for Digital Delivery compared to 73% for Technology and 13% for
Entertainment Services), the negative impact of the decrease in
Digital Delivery has been more than balanced by Q2 revenues 4.1%
up in the highly profitable Technology segment and a 16.8%
increase in Entertainment Services (changes at constant rates).

For the third quarter Technicolor reported 7.4% lower revenues
year-over-year at constant currency. While headline still
increased, albeit at a slower pace, at Entertainment Services,
revenue decline at Digital Delivery accelerated to -17.6%. Most
notably Q3 revenues from Technology were down by 25%. However,
against an exceptionally strong third quarter in 2010 impacted by
strong consumer electronics product shipments and a one-time
effect from audits for certain MPEGLA licensees. Year-to-date,
revenues from licensing were still 5% up as of September.

Technicolor's announcement on December 19 unveiled that the group
is currently facing strong headwind in its European Digital
Delivery activities resulting in a negative EBITDA of
approximately EUR(39) million in this division compared to a
positive EUR55 million in FY 2010 triggering another set of
restructuring actions. Noting that improving headroom under the
company's financial covenants and a stabilizing of the business
profile on the back of new orders were key elements of the B3
rating Moody's decided to change the outlook to negative.

Moody's is concerned that ongoing extraordinary effects may
continue to impact the credit quality of Technicolor, in addition
to the low visibility resulting to some extent from the high
seasonality of the business.

For an upgrade of the ratings, albeit unlikely at this stage,
Moody's expects Technicolor to be able to (i) reduce the reliance
on Technology by strengthening the contributions of its
activities in Entertainment Services and Digital Delivery
resulting in a more balanced income and cash flow profile and
(ii) increase the headroom under its financial covenants,
mirrored in improving interest coverage well above 1.5x
EBIT/Interest expense (06/2011 LTM as adjusted by Moody's: 1.0x)
and a positive free cash flow generation (EUR87 million) while at
the same time reducing leverage well below 4.0x Debt/EBITDA
(4.6x), all on a sustainable basis.

Should the company fail to fix the operational challenges,
reflected for instance by a continuing decrease in revenues and
operating profitability, resulting in tightening headroom under
its financial covenants, rating pressure will intensify.

Technicolor's ratings were assigned by evaluating factors that
Moody's considers relevant to the credit profile of the issuer,
such as the company's (i) business risk and competitive position
compared with others within the industry; (ii) capital structure
and financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside Technicolor's core industry
and believes Technicolor's ratings are comparable to those of
other issuers with similar credit risk.

Headquartered in Issy-les-Moulineaux, France, Technicolor is a
leading provider of solutions for the creation, management,
delivery and access of video for the Communication, Media &
Entertainment industries operating in three business segments:
Technicolor's Entertainment Services division offers its content
creator and distributor customer base services related to the
creation, preparation and distribution of video content. The
Digital Delivery division (formerly Technicolor Connect) supplies
satellite, cable and telecom operators with access and home
networking devices and software platforms. Technicolor conducts
extensive research activities to innovate and to support
solutions to its key customer industries. The Technology division
combines Technicolor's research and exploitation of its patent
portfolio through licensing programs. During the last twelve
months ending in September 2011, Technicolor recorded group
revenues of EUR3.6 billion.


DEUTSCHE LUFTHANSA: Moody's Ba1 Ratings Unaffected by bmi Sale
On December 22, 2011, International Airlines Group (IAG, not
rated), the parent company of British Airways (rated B1, positive
outlook), and Iberia (not rated), agreed to purchase British
Midland Limited (bmi) from Deutsche Lufthansa Aktiengesellschaft
(rated Ba1 stable). The transaction itself fulfills strategic
ambitions of both airlines -- for Lufthansa notably to divest a
loss-making airline and focus on its other more profitable
airlines; and for IAG to gain an additional foothold at Heathrow
airport, its hub for domestic and international flights. However,
Moody's believes that the transaction is too small in itself to
impact the credit profiles of either airline.

The terms of the transaction include: i) an acquisition price of
GBP172.5 million (c.EUR207 million), although subject to
potential reductions such that the net purchase price may be
negative. Moody's understands that the transaction is on a debt-
free basis; ii) Lufthansa will retain bmi's pension deficit; iii)
Lufthansa has the option to sell bmi regional and bmibaby (the
regional and discount airlines) prior to completion, otherwise
there would be a further price reduction for the transaction. The
transaction remains subject to clearance by regulators, who will
likely focus on IAG's position at Heathrow airport in terms of
slots. It is expected to complete towards the end of the first
quarter of 2012.

IAG has made clear that there is an urgent need for restructuring
at bmi. Under Lufthansa's ownership, the airline recorded an
operating loss of EUR145 million in 2010 and EUR154 million in
the first three quarters of 2011, such that the full year was
forecast to be weaker still than 2010. The dire situation at bmi
is reflected in the very generous financial terms of the
transaction for IAG, although the real question will be how well
IAG can integrate bmi and improve on its profitability. On the
back of this transaction, IAG has increased its own operating
profit target for 2015 to EUR1.5 billion by more than EUR100
million, but Moody's expects that it would also face significant
restructuring costs in the period towards 2015.

At this time, the transaction in itself is not expected to have
any meaningful impact on the overall credit profile or metrics of
either airline, given the relatively small size of bmi relative
to both airlines' sales and profits. In addition, Moody's
continues to believe that the main determinant of both airlines'
credit profiles will be the general economic outlook for the
Eurozone, as well as the continued high level of fuel prices.

International Consolidated Airlines Group S.A. (IAG) was formed
in January 2011 through the merger between British Airways and
Iberia. It was incorporated as a Spanish company with its shares
trading on both the London and Spanish Stock Exchanges. In the
nine months to September 2011, the company generated revenues and
an operating profit (before exceptional items) of EUR12.3 billion
and EUR451 million, respectively.

The principal methodology used in these ratings was the Global
Passenger Airlines published in March 2009. Other methodologies
used include Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in
June 2009.

Deutsche Lufthansa, headquartered in Cologne, Germany, is the
leading European airline in terms of revenues. In FY2010 it
reported revenues and an operating result of EUR27.3 billion and
EUR876 million, respectively. Lufthansa is a member of the DAX
index as one of the 30 largest publicly listed companies in

* GREECE: Lenders Resist IMF Pressure to Accept Bigger Losses
Christos Ziotis, Marcus Bensasson and Jesse Westbrook at
Bloomberg News report that Greece's creditors are resisting
pressure from the International Monetary Fund to accept bigger
losses on holdings of the indebted nation's government bonds.

According to Bloomberg, three people with direct knowledge of the
discussions said that lenders want the EUR70 billion
(US$91 billion) of new bonds the government will issue in return
for existing securities to carry a coupon of about 5%.

Bloomberg relates that the people said the IMF is pushing for
creditors to accept a smaller coupon in order to reduce Greece's
debt-to-gross domestic product ratio to 120% by 2020, a key
element of the Oct. 27 agreement by European Union leaders.

The IMF said on Dec. 13 that Greece's debt will balloon to almost
twice the size of its economy next year without a write-off
accord with investors, Bloomberg recounts.  The IMF and EU
leaders are trying to bring the country's debt down to a
sustainable level, Bloomberg says.

As part of Greece's EUR130 billion second bailout, investors
would take a 50% hit on the nominal value of EUR206 billion of
privately owned debt, Bloomberg discloses.  The people, as cited
by Bloomberg, said that exchanging bonds for securities with a 5%
coupon would leave investors with a 65% loss in the net present
value of their holdings of Greek government debt.

Two of the people said that both sides have agreed that the new
bonds should be governed by English law and that private
bondholders should have the same seniority after the swap as the
IMF and the European Financial Stability Facility, Bloomberg
notes.  The people said that the sides have also agreed that the
deal should include collective action clauses that would ensure
lenders participate in the swap, Bloomberg recounts.


* HUNGARY: Mandatory Liquidations Up 16% in 2011, Opten Says
MTI-Econews, citing company information provider Opten, reports
that the number of mandatory liquidations initiated this year was
20,078 on December 23, up almost 16% yr/yr.

Opten Strategic Director Hajnalka Csorbai compared this number to
a total of 11,000 mandatory liquidations registered in 2008, MTI

MTI relates that Opten said the number of voluntary liquidations
has reached almost 23,000 this year, about 70% up from 2010.

* HUNGARY: Defends Economic Management After Rating Downgrade
Margit Feher and Erin McCarthy at Dow Jones Newswires report that
Hungary defended its economic management after a second credit-
rating firm stripped the country of its investment-grade status,
a move that could further hamper growth.

Announcing its decision to lower Hungary to junk status, Standard
& Poor's Ratings Services said on Dec. 21 that the economy was
suffering from policies that lack predictability and credibility,
Dow Jones relates.

Moody's Investors Service already downgraded Hungary to junk
status last month and analysts expect Fitch Ratings to follow
suit early next year, Dow Jones recounts.

According to Dow Jones, analysts say the downgrades will push the
government to resume bailout talks with the International
Monetary Fund and the European Union, which the institutions
halted when Budapest declined to withdraw the central bank bill.
A European Commission spokesman said informal talks with Hungary
on financial assistance from the IMF and EU were now set to
resume in January, Dow Jones discloses.

Analysts say that Hungary, which is heavily indebted, is likely
to face higher funding costs next year unless it reaches an
agreement, Dow Jones notes.

Hungary's policy outlook has deteriorated as risks associated
with its large levels of household debt denominated in foreign
currencies, especially the Swiss franc, have risen, Dow Jones
states.  The forint's weakness this year has made that debt
burden particularly heavy this year for households and the
country's banking system, according to Dow Jones.

Hungary's economy was one of the hardest hit in the region by the
global slowdown, which helped to usher in the election of a more
conservative governing party in 2010, Dow Jones discloses.

Analysts said that with its ratings slashed to junk territory,
Hungary could fall victim to further capital outflows from its
currency and local bond markets, since many investors' mandates
allow for only investment-grade assets, Dow Jones notes.

                        Central Bank Bill

In a separate report, Bloomberg News' Zoltan Simon relates that
Hungarian Prime Minister Viktor Orban rejected European
Commission President Jose Manuel Barroso's request to withdraw
two bills the trading bloc and the International Monetary Fund
cited for breaking off talks on a financing package.

According to Bloomberg, Mr. Orban told HirTV in an interview on
Dec. 22 that there is "no means" to delay a draft central bank
law and a separate bill on the merger of the central bank and the
financial authority.

The EU, the IMF, the European Central Bank and the Hungarian
central bank said the bills may undermine monetary policy
independence, Bloomberg relates.


MANSFIELD GROUP: BoSI Secures EUR214-Mil. Judgment Against Owner
John Mulligan at Irish Independent reports that Bank of Scotland
(Ireland) has secured a EUR214 million judgment against hotelier
Jim Mansfield.

The hotelier and developer wasn't present to hear the ruling on
Dec. 21, but Justice Peter Kelly said in the Commercial Court
that Mr. Mansfield had failed to make any arguable defense to
claims made by the bank for the repayment of loans.

Mr. Mansfield (72) had given personal guarantees for loans made
to three of his companies -- HSS Developments, Parke Associates
and Jeffel, Irish Independent notes.  He'd alleged that Bank of
Scotland hadn't honoured an undertaking to provide his leisure
group with between EUR17 million and EUR20 million in funding
that was earmarked to complete the development of the Citywest
Convention Centre in Saggart, Co Dublin, Irish Independent
relates.  Mr. Mansfield insisted that the absence of the
additional funding meant that the overall development of the
scheme had been delayed, Irish Independent recounts.  That caused
subsequent issues with cashflow, which precipitated the collapse
of his Mansfield group, Irish Independent notes.

Last month, counsel for the bank told the court that Mr.
Mansfield's claim that the lack of additional funding prompted
the collapse of his "magnificent empire" was completely untrue,
Irish Independent discloses.

According to Irish Independent, the court was told at the time
that most of the loans attached to the Mansfield Group had
degenerated into "serious and repeated default".

Mr. Mansfield's HSS firm was placed in receivership by Bank of
Scotland in summer last year, as was Jeffel, Irish Independent
recounts.  HSS trades as Citywest Hotel.

Mr. Mansfield had used the three companies related to yesterday's
ruling to buy land in west Dublin to develop a hotel, conference
centre, residential units, a golf course and offices, Irish
Independent relates.

Mr. Justice Kelly also refused an application made by Mr.
Mansfield's legal team on Dec. 21 to put a stay on the Bank of
Scotland judgment pending a potential appeal to the Supreme
Court, Irish Independent notes.


BANCA MONTE: Shareholder Reaches Standstill Deal with Creditor
Gilles Castonguay at Dow Jones Newswires reports that Banca Monte
dei Paschi di Siena SpA's controlling shareholder has reached a
standstill agreement on a total return swap contract it holds
with a creditor, Credit Suisse Group AS, the latest in its push
for more time to pay off its debts.

Dow Jones relates that the Italian bank's shareholder, Fondazione
Monte dei Paschi di Siena, said in a statement Tuesday the
agreement on the Fresh 2008 contract will run until March 15.

The shareholder's 50.2% stake in the bank acts as collateral
against the debts, but this stake has lost its usefulness because
of this year's drop of more than 60% in the bank's share price,
Dow Jones notes.

Rather than take possession of the stake and sell it at a loss,
the creditors are working with the shareholder to give it more
financial maneuverability, Dow Jones states.

The shareholder, a non-profit foundation, has about EUR1 billion
of debt, Dow Jones discloses.  It took on a good part of the
amount to participate in Banca Monte dei Paschi di Siena's recent
capital increase and avoid dilution of its stake, Dow Jones says.

Banca Monte dei Paschi di Siena SpA -- is
an Italy-based company engaged in the banking sector.  It
provides traditional banking services, asset management and
private banking, including life insurance, pension funds and
investment trusts.  In addition, it offers investment banking,
including project finance, merchant banking and financial
advisory services.  The Company comprises more than 3,000
branches, and a structure of channels of distribution.  Banca
Monte dei Paschi di Siena Group has subsidiaries located
throughout Italy, Europe, America, Asia and North Africa.  It has
numerous subsidiaries, including Mps Sim SpA, MPS Capital
Services Banca per le Imprese SpA, MPS Banca Personale SpA, Banca
Toscana SpA, Monte Paschi Ireland Ltd. and Banca MP Belgio SpA.

IXFIN SPA: Commission Refers Italy to Court Over Incompatible Aid
The European Commission has decided to refer Italy to the Court
of Justice (CoJ) for not complying with a Commission decision of
October 2009 finding that Ixfin S.p.A., a company active in the
sector of contract manufacturing, call centers and logistics, had
received unlawful state aid and needed to repay it.  To date,
Italy has not recovered the aid from Ixfin, which has been in
bankruptcy proceedings since 2006.

"State aid control is essential to avoid that the viability of
unaided firms is threatened by subsidies granted to others, but
there can be no effective control of state aid, if Commission's
decisions are not complied with" said Commission Vice President
in charge of competition policy Joaquin Almunia.

On October 28, 2009, the Commission concluded that a loan
guarantee granted by Italy to Ixfin was incompatible with EU
rules, as it was not followed by a restructuring plan
demonstrating the company's return to viability.  The guarantee
involved EUR15 million in state subsidies, as Ixfin could not
have obtained from the market a guarantee on conditions
comparable to those, under which it was granted by the Italian
government.  That is the amount Italy was expected to recover or
to register in the bankruptcy proceedings within four month from
the adoption of the decision, together with the recovery
interests calculated until the date, on which Ixfin was declared

To date, Italy has not registered the due amounts nor recovered
the aid from the company based in Campania, southern Italy.

Moreover, in March 2007 Italy launched national court action with
the view of converting the bankruptcy into a Court-controlled
proceeding ("Amministrazione Straordinaria") that may allow Ixfin
to continue its activity with the risk that not only the unlawful
aid would not be recovered but the firm could yet get more aid.

The Commission has, therefore, decided to refer Italy to the CoJ.


Member States have a duty to recover state aid that has been
found incompatible by the Commission, within the deadline set out
in the Commission decision, usually four months.

The Commission clears vast amounts of state aid each year:
EUR73.7 billion in 2010 crisis-related aid excluded.  It
generally looks keenly on aid for regional development, research,
environmental protection and other general interest objectives.
Rescue and restructuring aid can also be granted provided the
beneficiary firm is ultimately viable and the distortions of
competition are kept to the minimum necessary.  To avoid having
to recover subsidies, Member States are strongly encouraged not
to grant them without being sure they are compatible with EU
rules. Rescue and restructuring aid that has not been cleared by
the Commission is considered illegal.

If a Member State does not implement a recovery decision, the
Commission may refer the matter to the Court of Justice under
Article 108(2) of the Treaty on the Functioning of the EU (TFEU)
that allows the Commission to directly seize the Court for
violations of EU state aid rules.


* MOLDOVA: Moody's Issues Summary Credit Opinion
This release represents Moody's Investors Service's summary
credit opinion on Moldova and includes certain regulatory
disclosures regarding its ratings.  This release does not
constitute any change in Moody's ratings or rating rationale for

Moody's maintains the following ratings on Moldova, Government of
Moldova, Government of Long Term Issuer (domestic and foreign
currency) ratings of B3

Ratings Rationale

The B3 rating reflects the assessment that Moldova's economic
resiliency remains very low, despite having posted robust GDP
growth before and after the sharp 2009 recession with -6% GDP
growth. GDP growth remains dependent on consumption and
investment financed via remittances from Moldovans working
abroad. Remittances can account for upwards of 30% of GDP in any
year and are subject to significant fluctuations. The lack of
diversification of the economic base and of sources of foreign
exchange earnings leave the economy vulnerable to domestic and
external shocks.

Institutional capacity is developing, although from a very low
level. The government has committed -- with the support of the
IMF -- to significantly improve fiscal transparency,
accountability and economic policy implementation. Serious
efforts are being made by the government to improve the country's
investment climate and to push the economy's European
integration. However, political uncertainty due to ongoing
tensions within the coalition may jeopardize continuity in the
economic, institutional and fiscal reform process.

Moldova has made good progress in recent years in improving key
general government debt indicators, which were on a clear
downward trend until the outbreak of the global crisis. However
the country's external debt remains high, reaching 111% of
current account receipts at the end of 2010. Moody's expects some
decline to around 103% of current account receipts in 2011 and
2012. Nevertheless, the relatively high (46% in Sep 2011)
dollarization of deposits in the domestic banking system and low
external liquidity imply high vulnerability to external shocks
such as a sharp depreciation.

Rating Outlook

The outlook for Moldova's government ratings is stable. Moody's
expects the economy to grow at around 4% yoy in the coming years.
Moldovan authorities -- with the help of the IMF -- have
ambitious plans to put the economic, institutional and fiscal
framework in a solid shape. Since January 2010 authorities are
being supported by the Extended Credit Facility and the Extended
Fund Facility -- two arrangements with the IMF amounting in total
to SDR369.6 million (around USD 588 million) and lasting until
end 2012. Improvements in economic resiliency, government
financial strength, and the economy's susceptibility to event
risk will of course take time to be implemented and to yield the
desired results. On top of this uncertainties remain concerning
the reform process, given political tensions within the coalition
and with the opposition. The inability of the parliament to elect
a President in the past 2 years mirrors this risk.

What Could Change the Rating - Up

Diversification of the economy and particularly sources of
foreign exchange earnings to reduce the dominance of remittances
would help boost economic strength and lower the economy's
susceptibility to domestic and external shocks, and would be
ratings positive. In addition, upward rating pressures would
derive from further progress on implementation of structural
reforms to streamline the public sector and improve the business
environment, such as through measures to speed business licensing
and registration, stronger bankruptcy procedures and legislation
to increase competition.

What Could Change the Rating - Down

Moldova's rating could come under downward pressure should any
shock, whether related to adverse weather effects on the
important agricultural sector, a structural decline in workers'
remittance inflows, and/or a lack of privatization receipts or
multilateral funding, create difficulties for its debt servicing

The principal methodology used in this rating was Sovereign Bond
Ratings published in September 2008.


PARPUBLICA-PARTICIPACOES: Moody's Maintains 'B1' Long-term CFR
Moody's Investors Service maintains these ratings on Parpublica-
Participacoes Publicas (SGPS), SA

Long Term Corporate Family (domestic and foreign currency)
ratings of B1

Probability of Default rating of B1

Senior Unsecured (domestic currency) ratings of B1

Senior Unsecured MTN Program (domestic currency) ratings of

Ratings Rationale

Parpublica is the government's industrial holding arm in
strategic companies and therefore serves the government's
political objectives. Its B1 rating (negative outlook) is notched
down from the sovereign bond rating (Ba2 negative outlook),
reflecting Moody's view that the company's ownership structure
(100% state-owned) together with the very significant financial,
strategic and management control exerted by the government
(which, for example, appoints members of the Management Board and
Audit Committee) justifies the determination of the rating
through credit substitution as opposed to a more granular
analysis. The rating also factors in that Parpublica does not
rely on direct funding from the government, as well as the value
of its equity holdings to be sold as part of the government's
need to raise cash. These will most likely be replaced with other
government-owned assets.

The outlook on the rating is negative, reflecting the negative
outlook on the government of RoP's rating.

A downgrade of the rating of the government of RoP would likely
result in a downgrade of the rating of Parpublica. Furthermore,
any evidence that the provision of financial support from the
government of RoP would not be forthcoming if needed would result
in a downgrade. In addition, negative pressure could develop in
the event of a weakening of Parpublica's liquidity profile

In line with the recent downgrade and negative outlook, Moody's
does not expect positive pressure to be exerted on the ratings in
the short term. However, a significant upgrade in the rating of
the government of RoP could result in an upgrade of Parpublica's

The principal methodology used in rating Parpublica-Participacoes
Publicas (SGPS), SA was the Government-Related Issuers:
Methodology Update published in July 2010. Other methodologies
used include Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in
June 2009 (and/or) the Government-Related Issuers methodology
published in July 2010.

Parpublica Participacoes Publicas SGPS, S.A. (Portuguese State
Agency) is an industrial holding entity domiciled in Lisbon,
Portugal. Parpublica is a state-owned company (through the
Ministry of Finance) incorporated to act as an industrial holding
company responsible for the management of equity stakes and real
estate assets held by the Portuguese State in Portuguese
companies of public or strategic interest. The main purpose of
this entity is to manage equity stakes in companies under
privatization plans or being restructured in anticipation of
privatization, as well as real estate assets of the Republic of
Portugal (RoP).


CHELYABINSK OBLAST: S&P Affirms 'BB+' Issuer Credit Rating
Standard & Poor's Ratings Services affirmed its 'BB+' long-term
issuer credit and 'ruAA+' Russia national sale ratings on
Chelyabinsk Oblast, an industrial region in Russia's Urals
Federal District. The outlook is stable.

"The ratings on the oblast reflect our view of its low budgetary
flexibility and predictability under Russia's developing and
unbalanced system of interbudgetary relations. Economic
concentration on metallurgy and exposure to a single taxpayer,
OAO Magnitogorsk Metallurgical Kombinat (MMK; not rated), which
leads to revenue volatility, and lack of reliable medium-term
financial and capital planning also constrain the ratings," S&P

The oblast's sound budgetary performance, very low debt burden,
and a positive liquidity position support the ratings.

"The stable outlook reflects our view that Chelyabinsk Oblast
will adhere to its conservative financial policies and maintain
sound budgetary performance, low debt, and a positive liquidity
position, despite potential revenue volatility stemming from
economic concentration," S&P said.

"We could take a negative rating action within the next 12 months
if loosened control over operating expenditures leads to a
structural deterioration of the oblast's budgetary performance,
as well as decreasing spending flexibility," S&P said.

"We could take a positive rating action if better-than-forecast
budgetary performance (in line with our upside-case scenario),
combined with documented cash policies, resulted in structural
consolidation of the oblast's liquidity position, with the view
to reducing the oblast's exposure to financial and cash
volatility. However, ratings upside is unlikely for the next 12
months, in our view," S&P said.

SOVCOMFLOT JSC: Moody's Cuts Corporate Family Rating to 'Ba1'
Moody's Investors Service has downgraded to Ba1 from Baa3 the
corporate family rating (CFR) and probability of default rating
(PDR) of Sovcomflot JSC (SCF). Concurrently, Moody's has
downgraded SCF's issuer rating to Ba2 from Ba1 and the senior
unsecured rating assigned to the US$800 million Eurobond issued
by SCF Capital Limited, which is a 100% indirect subsidiary of
SCF (SCF guarantees the Eurobond), to Ba2 with a loss given
default assessment of 6 (LGD6/90%) from Ba1. The outlook on all
ratings is stable.

As SCF is a 100% state-owned company, Moody's applies its
Government-Related Issuer (GRI) rating methodology in determining
the company's CFR. According to this methodology, the rating is
driven by a combination of (i) SCF's baseline credit assessment
(BCA) of 13 (mapping to Ba3); (ii) the Baa1 local currency rating
of the Russian government; (iii) the low dependence between SCF
and the government; and (iv) the strong probability of government

Ratings Rationale

The downgrade was triggered by Moody's decision to change SFC's
BCA to 13 (mapping to Ba3) from 12 (mapping to Ba2). This
decision followed the company's weaker than anticipated by
Moody's performance for the third quarter 2011 and the further
subsequent deterioration in the broader sector's trading
conditions since then. As a result, SFC's 2011-12 credit metrics
will most likely be significantly weaker than previously
estimated by Moody's and no longer commensurate with a BCA
equivalent of Ba2. The deterioration in SCF's performance
reflects the poor performance of the industry during 2011. This
was caused by the oversupply of vessels on the water, which
slashed freight rates to a very low level. The rating agency
notes that the BCA incorporates the assumption that industry
conditions will remain challenging for the next 12-18 months.

At the same time, Moody's continues to acknowledge SCF's solid
business profile thanks to its (i) strong customer base; (ii)
diversification in the gas transportation and offshore
businesses, alongside its conventional tanker business; (iii)
specialized ice-class fleet (including Arctic shuttle tankers),
which provides the company with a competitive advantage for
servicing projects and operations in harsh weather conditions;
and (iv) conservative fleet management, with only limited
exposure to the spot tanker market. In addition, Moody's notes
that SCF's liquidity remains solid and comfortably covers its
debt maturities over the next 12-18 months.

As stated above, there is a one-notch difference between the CFR
and both SCF's issuer rating and the senior unsecured rating
assigned to SCF Capital's Eurobond issuance. This reflects the
structural and contractual subordination of the bond to secured
debt, which comprises a major portion of the SCF group's total

In Moody's view, SCF's credit metrics are likely to remain weakly
positioned at Ba3 over the next 12-18 months as a result of the
anticipated challenging market environment. However, the stable
outlook reflects the rating agency's expectation that, despite
this, the company's solid liquidity will sustain its credit
profile until the market starts to recover.


Moody's could upgrade SCF's rating by one notch if the rating
agency were to change the company's BCA to Ba2 from Ba3. Moody's
considers it unlikely that any upward pressure could be exerted
on the BCA over the next 12-18 months. However, upward pressure
could occur in the longer term if SCF were to reduce its
debt/EBITDA ratio to 5.0x and increase its (funds from operations
(FFO) + interest expense)/interest expense ratio to 3.75x on a
sustainable basis, while maintaining its solid liquidity profile.

Moody's could downgrade SCF's rating by one notch if the rating
agency were to lower the company's BCA to B1 from Ba3. Moody's
could lower the BCA by one notch if SCF's financial metrics were
to continue deteriorating materially, such that its debt/EBITDA
were to rise above 6.5x and its FFO interest coverage were to
decline below 3.0x, respectively, as of year-end 2012 (compared
with 6.0x and 3.6x, respectively, as of September 2011). Since
SCF's good liquidity profile is an important supportive factor, a
material weakening of this profile would exert downward pressure
on the rating.


The principal methodology used in rating Sovcomflot JSC was the
Global Shipping Industry Methodology published in December 2009.
Other methodologies used include Loss Given Default for
Speculative-Grade Non-Financial Companies in the U.S., Canada and
EMEA published in June 2009 and the Government-Related Issuers
methodology published in July 2010.

Sovcomflot is the leading Russian energy shipping group,
servicing approximately 25% of all seaborne hydrocarbons exports
from Russia. The company is 100% state-owned. At September 30,
2011, SCF's last-12-months revenues were US$1.39 billion. The
company ranks among the world's top five energy shipping players
by deadweight tonnage (DWT), with a fleet of 148 vessels in
operation (as of June 2011), of which four are chartered in, for
a total of 11.6 million DWT. In addition, 17 ordered buildings,
totalling 1.8 million DWT, are to be delivered in 2012-14.

TAGANROG MOTOR: Court Postpones Bankruptcy Hearing Until Dec. 30
Russian Legal Information Agency, citing RIA Novosti, reports
that the Rostov Region commercial court on Monday postponed its
hearing of VTB bank's application for the bankruptcy of Taganrog
Motor Works (TagAz) until Dec. 30.

"The court has declared a recess until the Moscow Commercial
Court has considered the TagAz application for entering into a
settlement agreement with VTB," RAPSI quotes a source as saying.
The bank did not object to the delay, RAPSI notes.

After TagAz's output plummeted by a factor of three in 2009 it
accumulated RUR20 billion (US$640 million) in debt to its
lenders, RAPSI discloses.  The next year TagAz agreed to
reschedule the debt with all the banks except VTB, RAPSI notes.
According to RAPSI, its liabilities to VTB stood at RUR5.8
billion (US$185.5 million).

In 2010 VTB filed several lawsuits against TagAz to recover the
debt under its loans: RUR726 million (US$23.2 million), US$38.6
million, US$70 million, US$60 million and RUR774 million (US$24.7
million), RAPSI recounts.  In addition, VTB obtained a court
order to foreclose on the plant's mortgaged machinery and
equipment, RAPSI notes.

In July TagAz secured a deferral until late December regarding
repayment of the RUR726 million (US$23.2 million) owed to VTB and
a deferral of its debt repayment installments until December
2012, RAPSI relates.

VTB applied for the bankruptcy of TagAz in September, RAPSI

TagAz was founded in February 1997.  It began working with South
Korea's Hyundai in 2001.


NOVA LJUBLJANSKA: Moody's Downgrades Deposit Ratings to 'Ba1'
Moody's Investors Service has downgraded the debt and deposit
ratings of three Slovenian commercial banks following the one-
notch downgrade of the Slovenian government's sovereign debt
rating to A1 with negative outlook, from Aa3.

The affected commercial banks are Nova Ljubljanska banka, Nova
Kreditna banka Maribor and Abanka Vipa. In addition, Moody's has
also downgraded the issuer and senior unsecured ratings of SID
Banka, a government-owned specialised development bank, to A1
with a negative outlook from Aa3 in line with the sovereign
rating action.

These downgrades complete the review for downgrade initiated by
Moody's on September 26, 2011. At the same time, the standalone
bank financial strength rating (BFSR) of Abanka was downgraded to
E+ (mapping to B1 on the long-term scale) with a stable outlook,
from D- (mapping to Ba3 on the long-term scale).

In addition, Moody's has also downgraded the government-
guaranteed debt rating of Factor banka by one notch to A1 from
Aa3 with a negative outlook.

A full list of the affected long-term and short-term debt and
deposit ratings, including subordinated, junior subordinated debt
and government-guaranteed debt ratings is provided at the end of
this press release.

Ratings Rationale

Rationale for Downgrades

The key driver of these rating actions is the downgrade of the
Slovenian government's sovereign rating by one notch to A1 with a
negative outlook from Aa3 [
PR_234317]. The downgrade implies that the government has less
financial flexibility and would likely face more difficult policy
choices if multiple institutions were to need its financial
support at the same time.

Moody's also takes into account constraints placed by the ongoing
financial crisis in the euro area on the medium-term capacity and
willingness of European Union member states, including Slovenia,
to support senior creditors of institutions by providing ongoing
funding support and capital injections to the banking system. It
is important to note that Moody's continues to assume that
support will be forthcoming for Slovenian banks, if needed. Prior
to the rating actions Moody's incorporated extraordinarily high
systemic support of up to four notches in the supported ratings
of these banks. However, following the rating action Moody's now
factors in 2-3 notches of systemic support in the supported
ratings of Slovenian banks, thus bringing the uplifts to a level
that the rating agency deems more appropriate with the evolving
support environment and regional peers.


Consistent with the one-notch downgrade of the sovereign rating,
Moody's has adjusted the long-term deposit ratings of NLB
downwards by one notch to Ba1 and assigned a negative outlook. As
a result, NLB's long-term deposit rating now benefits from a
three-notch uplift from the bank's B1 standalone rating, down
from four notches previously. This level of systemic support
reflects the government's continued status as the key direct and
indirect shareholder in the bank, and the increase in its
shareholding to 61% further to the capital injection in March
2011. In addition, Moody's notes that NLB holds a dominant market
share, with almost 32% of the country's non-banking deposits as
at June 2011. NLB's BFSR of E+ (mapping to B1) was not affected
by this rating action and retains a stable outlook.


Moody's has downgraded the long-term deposit rating of NKBM by
one notch to Ba1 from Baa3 with a negative outlook, resulting in
a two-notch uplift from the bank's Ba3 standalone rating, down
from three notches previously. This uplift reflects NKBM's
position as being directly and indirectly majority-owned by the
government and its position as the second-largest franchise in
Slovenia. NKBM's BFSR of D- (mapping to Ba3) was not affected by
this rating action and retains a negative outlook.


The two-notch downgrade of Abanka's long-term deposit rating to
Ba2 from Baa3 with a negative outlook was driven by a combination
of the sovereign rating action and the downgrade of the bank's
standalone BFSR by one notch to E+ (mapping to B1 on the long-
term scale) with a stable outlook from D- (mapping to Ba3 on the
long-term scale). As a result, Abanka's supported ratings now
benefit from a two-notch uplift from the bank's standalone
rating, down from three notches previously. This support uplift
results from the government's indirect stake of approximately 26%
in Abanka, as well as the bank's demonstrated ability to qualify
for government-guaranteed funding facilities in the past.

In downgrading Abanka's BFSR, however, Moody's notes that the
bank's stand-alone credit profile has weakened over the past
year, with the bank posting losses of EUR40 million for the first
three quarters of 2011 due to increased provisioning. The bank
has struggled to remain profitable in light of a deteriorating
trend in asset quality and declining provisioning coverage. In
addition, Abanka's loan-to-deposit ratio (at 137% as at H1 2011)
is one of the worst compared to those of its domestic peers, and
the bank is facing a sizeable refinancing event with EUR350
million government-guaranteed bonds maturing in September 2012.
Although the refinancing risk is mitigated by the bank's ample
holdings of liquidity, the ongoing turmoil in the euro area and
the absence of alternative sources of refinancing create
additional pressure on the bank to scale down its growth plans.
The downgrade places Abanka's BFSR at the same level as that of
NLB, which also remained loss-making during 2011.


Moody's has downgraded the issuer and senior unsecured ratings of
SID Banka, a government-owned specialized development bank, by
one notch to A1 with a negative outlook from Aa3, in line with
the action taken on the sovereign rating. The rating action and
rating sensitivities of SIB banka are directly correlated with
those of the government.

This reflects Moody's view that the Slovenian government is
committed to supporting the bank, should this become necessary.
Specifically, Moody's view is based on (i) the bank's full
ownership by the government; (ii) an explicit government
guarantee on all the bank's liabilities (under the amended
Slovene Export and Development Bank Act); and (iii) the bank's
strong policy role in extending liquidity to Slovenian commercial
banks and targeted sectors in the economy.


In downgrading Factor banka's government-guaranteed debt issue by
one notch to A1 with a negative outlook from Aa3, Moody's notes
that the issue receives the same rating as the Slovenian
government bond rating. This is because, under the Deed of
Guarantee, the Republic of Slovenia unconditionally and
irrevocably guarantees the 'due and punctual payment' of all sums
due and payable by Factor banka as contractually required under
the conditions of this debt instrument. This is the only
instrument issued by Factor banka that Moody's rates.


Moody's continues to note that the standalone credit profile of
the rated Slovenian commercial banks remains weak. These concerns
are reflected in the rating agency's assessment of the low
standalone ratings of Slovenian banks, which have an average
asset-weighted standalone rating of B1, one of the lowest in
central and eastern Europe.

Further pressure on standalone ratings may result from an
increased likelihood for the banks to realise further losses on
their high corporate-sector exposures at a time when internal
capital creation in the Slovenian banking system is one of the
lowest recorded in recent years.

The sensitivity of the supported ratings will also be influenced
by rating actions on the government rating, in line with the
aforementioned systemic support considerations.


These ratings were downgraded:

Issuer: Nova Ljubljanska banka d.d.

   -- Long-term local- and foreign-currency deposit ratings to
      Ba1 from Baa3 with negative outlook

   -- Short-term local- and foreign-currency deposit ratings to
      Non-prime from Prime-3

   -- Subordinate debt ratings to Ba2 from Ba1, remains on review
      for downgrade

   -- Government-guaranteed senior unsecured bond/debenture
      ratings to A1 from Aa3 with negative outlook

Issuer: Nova Kreditna banka Maribor

   -- Long-term local- and foreign-currency deposit ratings to
      Ba1 from Baa3 with negative outlook

   -- Short-term local- and foreign-currency deposit ratings to
      Non-Prime from Prime-3

Issuer: Abanka Vipa d.d.

   -- Banking financial strength rating (BFSR) to E+ from D- with
      stable outlook

   -- The BFSR now maps to B1 (negative) on the long-term scale,
      from D- mapping to Ba3 previously

   -- Long-term local- and foreign-currency deposit ratings to
      Ba2 from Baa3 with negative outlook

   -- Short-term local- and foreign-currency deposit ratings to
      Non-Prime from Prime-3

   -- Preferred stock non-cumulative rating to Caa1 from B2 with
      negative outlook

   -- Government-guaranteed senior unsecured bond/debenture
      ratings to A1 from Aa3 with negative outlook

Issuer: SID banka, d.d., Ljubljana

   -- Issuer rating, to A1 from Aa3 with negative outlook

   -- Senior unsecured regular bond/debenture ratings to A1 from
      Aa3 with negative outlook

Issuer: Factor Banka

   -- Government-guaranteed senior unsecured ratings to A1 from
      Aa3 with negative outlook

These ratings remain on review for downgrade pending the
reassessment of government support assumptions in European bank
subordinated debt (see earlier announcement entitled: "Moody's
reviews European banks' subordinated, junior and Tier 3 debt for
downgrade", published on 29 November 2011) .

Issuer: Nova Ljubljanska banka d.d.

   -- Junior subordinate debt rating of B1(hyb)

Issuer: Nova Kreditna banka Maribor

   -- Junior subordinate debt ratings of Ba3(hyb)

   -- Backed junior subordinate ratings of Ba3(hyb)

These ratings were not affected:

Issuer: Nova Ljubljanska banka d.d.

   -- BFSR of E+ on stable outlook (mapping to B1 on the long-
      term scale)

Issuer: Nova Kreditna banka Maribor

   -- BFSR of D- on negative outlook (mapping to Ba3 on the long-
      term scale)

Methodologies Used

The methodologies used in rating Nova Ljubljanska Banka (NLB),
Nova Kreditna banka Maribor (NKBM) and Abanka Vipa (Abanka) were
Banking Financial Strength Ratings: Global Methodology,
Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: A Refined Methodology published in March 2007, Moody's
Guidelines for Rating Bank Hybrid Securities and Subordinated
Debt published in November 2009.

Other factors used in these ratings are described in Frequently
Asked Questions: Moody's Guidelines for Rating Bank Hybrid
Securities and Subordinated Debt published in November 2009.

The methodologies used in rating SID Banka were Revised
Methodology for Government Related Non-Bank Financial
Institutions published in August 2006, and Government-Related
Issuers: Methodology Update published in July 2010.

* SLOVENIA: Moody's Cuts Credit Rating on Banking System Concerns
John Detrixhe and Boris Cerni at Bloomberg News report that
Slovenia had its credit rating lowered one step to A1 by Moody's
Investors Service on the potential need for the government to
support its banking system amid Europe's debt crisis.

The euro-area nation's banking industry has assets that are about
136% of gross domestic product, which is "relatively large when
compared to other systems in eastern Europe," Bloomberg quotes
Moody's as saying on Dec. 22 in a statement.  It assigned a
negative outlook to Slovenia's credit grade, the fifth-highest.
Standard & Poor's ranks the nation AA-, one level higher,
Bloomberg relates.

Slovenia was downgraded at Moody's for the second time in three
months as the euro area struggles to resolve its sovereign-debt
crisis, prompting stepped-up ratings scrutiny for the region,
Bloomberg discloses.  S&P and Fitch ratings said this month they
may cut the scores of 15 euro-region members after assessing the
outcome a European Union summit on a tighter fiscal pact,
Bloomberg notes.

"Asset quality pressure and the euro-area debt and funding crisis
have further exposed significant vulnerabilities in the solvency
and short-term external funding and overall business model of the
largest institutions in Slovenia's financial sector," Moody's, as
cited by Bloomberg, said.

Slovenia's rating was lowered one level by S&P, Moody's and Fitch
Ratings in September, citing fiscal concerns, a weak domestic
banking industry and a poor outlook for the export- driven
economy, Bloomberg recounts.  The nation is rated AA- by Fitch,
according to Bloomberg.

The former Yugoslav republic needs to repay EUR1.17 billion
(US$1.5 billion) in bonds next year, according to data compiled
by Bloomberg.

"The further weakening economic growth outlook also complicates
the government's ability to achieve its medium-term fiscal
consolidation plans," Bloomberg quotes Moody's as saying.  "The
highly volatile funding conditions on the euro-area bond markets
represent additional risks even for a small issuer like Slovenia
in the event that the financing needs exceed the original


SAAB AUTOMOBILE: U.S. Unit Taps Administrator to Run Biz
Jonathan Welsh, writing for The Wall Street Journal, reports that
Saab Cars North America, the U.S. sales and distribution unit of
Swedish car maker Saab Automobile AB, has named an outside
administrator to run the company as part of a plan to avoid
immediate liquidation following its parent company's bankruptcy
filing Monday.

During a telephone conference with reporters last week, the U.S.
operation's chief operating officer Tim Colbeck said the outside
firm, McTevia & Associates, will attempt to resume the unit's
operations including warranty work and business with dealers that
essentially stopped with the bankruptcy filing.

Mr. Colbeck also said the U.S. Saab operation is trying to
reestablish business with its parts supplier in Sweden, which is
a separate company that is not in bankruptcy.

Mr. Colbeck said the U.S. unit "basically stopped our business in
an effort to not incur any additional debt."

WSJ relates Mr. Colbeck said the overall plan is to "keep this
brand going."  However, he acknowledged that the outlook right is
not good.  Creditors could still force Saab North America into
bankruptcy and liquidation, he said.  The U.S. unit could also
seek court protection in the future, though it has made a point
so far of keeping the procedures out of court, he said.

U N I T E D   K I N G D O M

LADBROKES PLC: Moody's Maintains 'Ba2' Corporate Family Rating
Moody's Investors Service maintains these ratings on Ladbrokes
plc and its following affiliates:

Long-Term Corporate Family Ratings (domestic currency) of Ba2

Senior Unsecured MTN (domestic currency) ratings of (P)Ba2; 50
-- LGD4

Probability of Default ratings of Ba2

Ladbrokes Group Finance plc

BACKED Senior Unsecured (domestic currency) ratings of Ba2; 50
-- LGD4

BACKED Senior Unsecured MTN (domestic currency) ratings of
(P)Ba2; 50 -- LGD4

Rating Rationale

Ladbrokes' Ba2 CFR continues to reflect its status as a pure-play
betting company and the world's biggest bookmaker by number of
licensed betting shops. The Company is also a leading operator of
betting and gaming brands, and it generates most of its recurring
gross win in the competitive and mature UK betting market.
Moody's recognizes the Company's solid market positioning in the
UK and its strong brand name; however, Moody's believes that
limited geographic and line-of-business diversity (70% operating
profits generated from the UK retail estate) makes Ladbrokes more
sensitive to changes in its domestic operating environment, such
as regulatory or tax changes, consumer trends and/or adverse
national sporting results.

The instrument rating of the bonds and provisional rating of the
EMTN program are at the same level as the CFR because the notes
rank pari passu in right of payment with all of the company's
existing and future senior unsecured indebtedness. The company's
fully-owned and guaranteed subsidiary, Ladbrokes Group Finance
plc is the sole issuer of unsecured bank facilities and bonds.

The stable outlook reflects the positive evolution of the
company's financial metrics following a substantial reduction in
debt through cash flow and tax rebates from HMRC. This
deleveraging means the company is better placed to maintain on a
sustainable basis a ratio of net debt to EBITDA below 4.5x and a
retained cash flow (RCF) to net debt ratio above 10% (both ratios
as adjusted by Moody's), which had been previously identified as
drivers of an outlook stabilization. Furthermore, in Moody's
view, the company's recent improvements in machines and digital
offering are proving successful. Ladbrokes is expected to
continue to invest in capex to support further improvements to
its offerings, albeit in a prudent manner and at a level that
would not jeopardize the company's reported net leverage target
of below 3x.

In addition to an improved set of financial metrics, which now
fall in line with Moody's expectations at the current rating
level, the stable outlook assumes that while the appetite for
gaming could remain muted for some time, the current economic
environment and consumer confidence will not revert to levels
that would put material pressure on Ladbroke's performance or
metrics. The stable outlook is also premised on Ladbrokes
maintaining an adequate liquidity profile by retaining its ample
covenant headroom and availability under its facilities and
proactively refinancing upcoming maturities well in advance.

Upward pressure on the rating could arise if (i) the ratio of net
debt to EBITDA (as adjusted by Moody's) trends towards 3.5x on a
sustainable basis and (ii) the ratio of retained cash flow to net
debt (as adjusted by Moody's) remains above 20% on a sustainable

Negative rating pressure would occur should the current momentum
in operational performance not be maintained, leading to a
deterioration in metrics such that (i) net debt to EBITDA trends
above 4.5x and/or (ii) retained cash flow to net debt falls below
10%. Negative pressure would also arise should the company's
liquidity risk profile become challenged.

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

Headquartered in the UK, Ladbrokes is a leading operator of
betting and gaming brands in the UK. At June 30, 2011, the group
reported last twelve months net revenues of GBP963 million. It
operates through three principal channels: retail betting and
gaming - comprising 2,097 licensed betting shops (at June 30,
2011) in the UK, Ireland, Belgium and Spain; online betting and
gaming, and telephone betting.

RANK GROUP: Moody's Maintains 'B1' Long-term Corp. Family Rating
Moody's Investors Service maintains these ratings on Rank Group
plc and its following affiliates:

  Long-Term Corporate Family (foreign currency) rating of B1

  Probability of Default rating of B1

Rank Group Finance plc

  BACKED Senior Unsecured (foreign currency) ratings of B3; 85
  - LGD5

Rating Rationale

Rank's B1 corporate family rating (CFR) reflects the company's
position as a leading UK gaming operator with entrenched industry
positions in bingo and casinos. The rating is tempered by a
challenging operating environment with consumer confidence
generally subdued across Europe and new smoking bans that are
negatively affecting the company's Belgian and Spanish
operations. The rating is also constrained by the company's
relatively high leverage, as adjusted by Moody's, that includes
sizeable operating lease liabilities.

Rank's ratings are supported by the progress it has made towards
stabilizing its operational performance combined with a stated
commitment to continue reducing leverage. At the end of H1 2011,
adjusted leverage had been further reduced to 4.0x from 4.8x at
year end 2010 following the receipt of further value added tax
(VAT) refunds.

In November, the European Court of Justice ruled in favor of Rank
in its long-running dispute with HMRC, which allows Rank to keep
around GBP250 million of the GBP280 million in VAT refunds it
received from earlier UK court rulings. HMRC can still file a
claim on the remaining GBP30 million, which relates to the
taxation of slot machines in the same VAT case. The ruling is
credit positive because it enables Rank finally to unlock the
funds and engage in growth activities, such as expanding its G
Casino estate ahead of schedule. In addition, the company could
use the funds to build up its online brand by updating and
marketing Rank Interactive. These investments would bolster the
company's position in its core sectors and allow it to compete
effectively against rivals with online platforms that have
benefitted from heavier expenditure over the past few years. In
Moody's view, the company is unlikely to use the proceeds to pay
a special dividend. For one thing, that would be out of line with
its previous public statements and it goes against the prudent
financial policy that Rank and Guoco Group (its largest
shareholder) have been following.

In addition, Moody's does not expect the change in ownership or
management earlier this year to impact Rank's strategy as Guoco
Group has historically been supportive of the company's business
and financial strategies. The rating therefore reflects Moody's
expectation that Rank will continue to maintain a prudent
financial policy and preserve an adequate liquidity profile at
all times, including the prompt refinancing of upcoming debt

The B3/LGD5 rating for the USD 14.3 million guaranteed notes due
2018 issued by Rank Group Finance Plc is rated two notches down
from the CFR, reflecting the structural subordination to the
company's syndicated bank facilities, which have the benefit of
upstream guarantees from the company's major operating

Rank's stable outlook reflects a steadier performance of the
Bingo operations, and the company's operating profitability which
remains well positioned at the current rating level. The stable
outlook also incorporates Moody's expectations that Rank will
continue to maintain its reported net leverage in the 2.5x range
as previously communicated by management. Although adjusted
leverage has dropped from 5.3x in H1 2009 to 4.0x in H1 2011, the
sustainability of credit metrics at improved levels still needs
to be proven for positive pressure to develop on the rating in
the wake of resumption of dividends, an active capex program and
the new ownership by Guoco Group.

Upward pressure on the rating could arise if Rank succeeds in
halting the trend of declining attendances in Mecca bingo on a
sustainable basis, while at the same time maintaining its solid
performance in Grosvenor Casinos; with continuation of free cash
flow generation and Moody's adjusted leverage falling to 4.5x.

Negative pressure on the rating could arise if the positive
trends of revenue stabilization cannot be maintained or if
liquidity concerns are not promptly addressed. Downward pressure
of the ratings would also emerge if adjusted leverage were to
move towards 6.0x or above.

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

With headquarters in Maidenhead, England, Rank is a predominantly
UK-based gaming group with interests in casinos, bingo, and
interactive online gaming. Rank reported revenues of GBP580
million for the 12 months ended 30 June. Rank Group Finance plc
is Rank's fully-owned and guaranteed subsidiary.

* UK: Four Out of Ten AIM Companies in "Poor Financial Health"
The Scotsman reports that four out of ten companies quoted on the
Alternative Investment Market (Aim) are in "poor financial

According to the Scotsman, research group Company Watch found
that 41% of the 750-plus Aim firms it surveyed could be described
as being in a "warning area".

History shows that, over the past 13 years, one in four companies
that find themselves in this "danger zone" either file for
insolvency or are forced to undergo a major financial
restructuring, the Scotsman notes.

The worst performing sectors on Aim are companies specializing in
motoring, the research revealed, followed by telecoms firms,
leisure, construction and property, the Scotsman discloses.

Nick Hood, head of external affairs at Company Watch, which
specializes in monitoring the financial health of companies,
warned that the picture was only likely to deteriorate over the
coming year, the Scotsman relates.

"Our survey shows the strains affecting companies listed on Aim
in these tough times.  It highlights that sectors most affected
by government cost-cutting and the collapse in consumer
confidence, such as construction, leisure and motor are in
serious trouble.  In all of these sectors, prices are under
severe downward pressure, profit margins are falling and major
stake holders such as banks, suppliers and trade insurers are
applying increasingly strict credit policies, the Scotsman quotes
Mr. Hood as saying.  "The fact that the whole market only rates
at 44% of maximum financial health and that 41% of non-financial
Aim stocks are in our high risk warning area is deeply worrying.
Worse still, these figures are based largely on 2010 financial
results.  As accounts for the more troubled 2011 start to be
filed from next March onwards, we fear that the sluggish growth
now hobbling the UK economy and the slow-motion financial car
crash in the eurozone will create an even worse profile for Aim


* EUROPE: ECB Provides Low-Interest Loans to Euro-Zone Banks
David Enrich at The Wall Street Journal reports that hundreds of
euro-zone lenders took out EUR489.19 billion (US$640 billion) in
low-interest loans from the European Central Bank on Dec. 22, as
the currency area extended a massive financial lifeline to its
struggling banking industry.

The unexpectedly heavy demand from 523 banks for the three-year
loans highlighted the severity of Europe's financial crisis,
while also stirring some hopes that the action could help defuse
it, or at least prevent it from getting worse, the WSJ notes.

According to the WSJ, investors didn't seem convinced that the
loans would drastically improve banks' prospects.

The ECB's loan program - the first in which it has offered three-
year loans - appears to be the central bank's main weapon, at least
for now, in combating Europe's crisis, the WSJ discloses.

Through the loans, the ECB is trying to address a crucial
weakness in the euro zone's financial system, the WSJ says.
Nervous institutional investors have essentially stopped lending
to banks, fearful of their heavy holdings of government bonds and
other assets that appear at growing risk of default, the WSJ

If the dry spell persists into 2012, it could become a major
problem, the WSJ states.  According to the WSJ, regulators and
analysts say that European banks have more than EUR700 billion of
their own debt maturing next year, including more than EUR200
billion in the first three months.

ECB officials feared that without intervention, many banks would
cut lending to small businesses and households, strangling
Europe's weak economy, the WSJ says.

Under the three-year loan offer on Dec. 21, banks could borrow as
much as they wanted at the low rate as long as they had the
necessary collateral, the WSJ states.  Another batch of three-
year loans will be available Feb. 29, the WSJ notes.

* 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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