TCREUR_Public/120125.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

         Wednesday, January 25, 2012, Vol. 13, No. 18

                            Headlines



A R M E N I A

ACBA-CREDIT: Moody's Withdraws 'Ba2' Long-term Deposit Rating


B E L G I U M

FOURS SEAS: Moody's Lowers Rating on Class A Notes to 'B1'
TAMINCO GLOBAL: Moody's Assigns '(P)B2' Corporate Family Rating
TAMINCO GLOBAL: S&P Assigns 'B+' Long-Term Corp. Credit Rating


F R A N C E

ALCATEL-LUCENT: Moody's Withdraws 'B2' Senior Debt Ratings


G E R M A N Y

Q-CELLS SE: Can't Defer Payment of EUR202-Mil. Corporate Bond


G R E E C E

VESTJYSK BANK: Bankruptcy Unlikely, Investment Newsletter Says
* GREECE: EU Ministers Reject Private Bondholders' Debt Offer


I R E L A N D

BANK OF IRELAND: S&P Affirms 'BB+/B' Counterparty Credit Ratings
ISAACS HOSTEL: Goes Into Liquidation
JURYS AND BERKELEY: Syndicate Lenders Take Over Operations


I T A L Y

TIRRENIA DI NAVIGAZIONE: Compagnia Italiana Faces EU Probe
* ITALY: Corporate Bankruptcies Rise in 2011, Cerved Says


K A Z A K H S T A N

BTA BANK: Fitch Cuts Long-Term Issuer Default Rating to 'RD'
KAZAKH MORTGAGE: Fitch Lowers Rating on Class C Notes to 'CCCsf'


N E T H E R L A N D S

BASE CLO I: S&P Affirms Rating on Class E Notes at 'B+'
OPERA FINANCE: Moody's Lowers Rating on Class A Notes to 'Caa3'
PDM CLO I: S&P Raises Rating on Class E Notes to 'CCC+'
PEARL MORTGAGE: Moody's Lowers Rating on Class B Notes to 'Ba2'
PEARL MORTGAGE: Moody's Affirms Rating on Class B Notes at 'Ba2'


P O L A N D

POLKOMTEL SA: S&P Withdraws 'B+' Long-Term Corp. Credit Rating


P O R T U G A L

COMBOIS DE PORTUGAL: S&P Cuts Corporate Credit Rating to 'CCC+'
PORTUGAL TELECOM: S&P Cuts Corporate Credit Ratings to 'BB+/B'
REDE FERROVIARIA: S&P Lowers Corporate Credit Rating to 'CCC+'
* PORTUGAL: Second Bailout Likely; May Not Return to Market


R U S S I A

MOSCOW INTEGRATED: Fitch Revises Outlook on 'BB+' IDR to Stable
TENEX-SERVICE: S&P Lifts Counterparty Credit Ratings From 'BB+/B'


S P A I N

TDA 26-MIXTO: Fitch Affirms Rating on Class 2-C Notes at 'CCCsf'


S W E D E N

FERROMET: To Discuss Debt Repayment with Creditors Tomorrow


S W I T Z E R L A N D

PETROPLUS HOLDINGS: To File for Insolvency After Debt Talks Fail
PETROPLUS HOLDINGS: Halts Coryton Deliveries; Shares Suspended


T U R K E Y

VESTEL ELEKTRONIK: S&P Affirms 'B-' Corporate Credit Rating


U N I T E D   K I N G D O M

AVOCET HARDWARE: Goes Into Administration, Seeks Buyer
CRT RECYCLING: EA Rules Force Firm to Enter Insolvency
GEORGE WHITE: Enters Administration, Cuts 61 Jobs
PEACOCK GROUP: Follows Peacocks In Administration, Sells Bonmarch
PREMIER FOODS: Fitch Cuts Long-Term Issuer Default Rating to 'B+'

TANGRAM LEISURE: In Administration, Sells Lifehouse Resort
TM NEBURN: Progress Group Buys Firm Out of Administration


X X X X X X X X

* EUROPE: Germany Open to Boosting Rescue Funds to EUR750 Billion
* EUROPE: S&P Affirms EU's Issuer Credit Rating; Outlook Negative


                            *********


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A R M E N I A
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ACBA-CREDIT: Moody's Withdraws 'Ba2' Long-term Deposit Rating
-------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings of ACBA-
Credit Agricole (Armenia) for business reasons. At the time of
withdrawal, ACBA-Credit Agricole's ratings were as follows: long-
term local currency deposit rating of Ba2, long-term foreign
currency deposit rating of Ba3, short-term local and foreign
currency ratings of Not Prime, Bank Financial Strength Rating
(BFSR) of D-. The outlook on the bank's local currency deposit
rating and BFSR was stable, while the outlook on the foreign
currency deposit rating was negative driven by the negative
outlook on Armenia's foreign currency deposit ceiling.

Ratings Rationale

Moody's Investors Service has withdrawn the credit rating for its
own business reasons.

Headquartered in Yerevan, Armenia, ACBA-CA reported total assets
of US$522.2 million, total capital of US$114.1 million and net
income of US$8.2 million, according to its unaudited financial
statements based on IFRS as of end-H1 2011.


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B E L G I U M
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FOURS SEAS: Moody's Lowers Rating on Class A Notes to 'B1'
----------------------------------------------------------
Moody's Investors Service has downgraded to B1(sf) from Ba1(sf)
the rating of the Class A notes issued by Four Seas S.A., due to
increased risk of payment default, as the transaction is reaching
its maturity date without a definitive plan for the repayment of
the notes on their maturity date in March 2012.

Issuer: Four Seas S.A.

   -- US$125M A Notes, Downgraded to B1 (sf); previously on
      Nov. 10, 2011 Downgraded to Ba1 (sf)

Four Seas S.A. is an asset-backed securities (ABS) transaction
backed by the selling company's rough and polished gem diamond
inventories, located mainly in Belgium, accounts receivables, and
a cash reserve account. The transaction is exposed to refinancing
risk, market value risk, as well as to complex operational risks
associated with the potential liquidation of the diamond
inventories to repay the notes at maturity.

Ratings Rationale

The downgrade reflects Moody's increased uncertainty of a
repayment of the notes on their maturity date in March 2012. As
the maturity date approaches without the conclusion of a
repayment plan, the notes are subject to a higher probability of
payment default.

While indications of financing commitments from large and
creditworthy lenders have been communicated to Moody's,
uncertainties remain about the scope, timing and details of the
repayments of the notes. As a result, there is a material chance
of the notes not being repaid at maturity.

Payment Default

Repayment of the notes in this transaction will come from either
a refinancing on the maturity date or, after the maturity date, a
liquidation of the diamond inventory backing the notes. The lack
of full principal repayment on the maturity date would constitute
a default under Moody's rating definition.

The downgrade reflects increased default probability in the
absence of a definitive refinancing plan allowing the notes to be
repaid at maturity, while taking account of the high anticipated
recoveries. Moody's generally rates securities subject to a
payment default at a maximum of B1, as detailed in the rating
implementation guidance: "Moody's Approach to Rating Structured
Finance Securities in Default", published in November 2009. Under
this framework, a B-rating for securities in default or very
likely to default is associated with a very high recovery
expectation.

Liquidation Recoveries

Given the issuer's ownership of the diamond inventory as security
for the notes and the amount of over-collateralization including
the cash reserve, Moody's expects high recoveries following a
payment default, under the liquidation scenario. Moody's ratings
consider the anticipated recoveries from the liquidation process
over a two-year period after the maturity date of March 2012 and
the ratings address the expected loss on the notes by March 2014.

Recoveries are exposed to operational risks surrounding the
liquidation of the diamond inventory by the back-up servicer.
Some of these risks include potential difficulties in recovering
the inventory, in particular for diamonds on consignment, despite
the benefit of insurance policies and a back-up servicer.

However, the transaction benefits from structural features
designed to allow for continued interest payments and principal
recoveries under a liquidation scenario. These features provide
for the (i) Antwerp Diamond Bank, a fully-owned subsidiary of KBC
bank NV (rated A1/Prime-1), as the warm back-up servicer, to step
in and liquidate the diamond inventory; (ii) Bank of New York, as
the current third-party cash manager, to allocate all payments
received from the liquidity line and the proceeds from the
inventory sale; (iii) Standard Chartered Bank (rated A1/Prime-1),
as the liquidity line provider, to continue to provide coverage
for approximately 12 months of senior fees and coupon payments;
(iv) the $13.67 mm cash reserve to be used for repayment of the
notes; and (v) insurance policies signed with various insurers
(all rated or subsidiaries of parents rated at least A2/Prime-1),
to cover potential theft by employees or management.

Assumption sensitivity

Key modeling assumptions, sensitivities, cash-flow analysis and
stress scenarios have not been updated as the downgrade has been
primarily driven by increased default risk.

Uncertainty mainly stems from the availability of refinancing.
Non-repayment of the notes at maturity remains the most stressful
scenario considered in Moody's analysis. Should the notes not be
repaid by the maturity date, their rating would be negatively
affected.

Moody's rating approach for this transaction considers both the
probability of a payment default associated with a liquidation
scenario and the expected recoveries from the liquidation of the
assets backing the notes, as discussed above.


TAMINCO GLOBAL: Moody's Assigns '(P)B2' Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service has assigned provisional (P) B2
Corporate Family Rating ("CFR") and Probability of Default Rating
("PDR") to Taminco Global Chemical Corporation.

Moody's has also assigned provisional (P) B1/LGD3 (32) ratings to
US$525 million first lien senior guaranteed 7-year term loan and
US$198 million first lien senior guaranteed 5-year revolver bank
facility and (P) Caa1/LGD5 (86) rating to the proposed US$380
million second lien senior guaranteed notes due 2020 to be issued
by Taminco Global Chemical Corporation. The outlook on all
ratings is stable.

Taminco Global Chemical Corporation, a Delaware company, was
established in December 2011 to consummate the acquisition of
Taminco's business by Apollo Global Management LLC. The
acquisition values the group at US$1.4 billion and will be funded
by US$543 million cash common equity contribution and US$905
billion in the proposed debt. The proceeds will be used to fund
the purchase and refinance all outstanding legacy obligations of
the acquired companies (except the European factoring facility).

Following the closing of the acquisition, Taminco Global Chemical
Corporation is expected to become the holding company, with whole
indirect ownership of Taminco Group Holdings Sarl and Taminco
Group NV, which was the holding and the reporting entity of the
group, prior to the acquisition. The provisional (P)B2 ratings
are therefore being assigned prospectively in advance of the
acquisition, the forthcoming placement of the new debt and
refinancing of legacy liabilities of the group. These ratings
reflect Moody's preliminary credit opinion regarding the
transactions only. Upon the closing of the acquisition and the
conclusive review of the final documentation, Moody's will
endeavor to assign definitive corporate family rating and the
rating to the debt instruments. A definitive rating may differ
from a provisional rating.

Ratings Rationale

The provisional (P)B2 corporate family rating is underpinned by
the overall positive assessment of the company's business
profile.

Moody's considers Taminco's modest size and limited
diversification, measured in terms of the global chemicals
industry, to be balanced by the relatively high profitability of
the business, that reflects the concentrated structure of its
markets in the US and Western Europe, the benefits allowed by the
company's integrated production model, and its focus on higher
margin alkylamines derivatives products. Moody's notes a
relatively high product concentration of the company's revenues,
and view the associated risks in the favorable context of
Taminco's leading market positions and the long-established and
relatively diversified customer relationships with leading
chemicals manufacturers.

Looking forward, the ability to maintain strong profitability
will require continuous improvement in the product portfolio to
capture new applications and remain a key supplier to high growth
chemicals segments, including in Asia.

Since its spin-off from Union Chimique Belge in 2003, Taminco has
delivered strong profitable growth, through several acquisitions
and investment. Following the acquisition by Apollo Global
Management LLC in 2012, Moody's expects the company to be
relatively levered with Total Debt/EBITDA at c.4.4x (including
drawings under the European factoring facility), and see limited
prospect to reduce debt in the next 18-24 months, while Taminco
completes its investment in the US. Overall, Moody's assessment
of the elevated financial risk also takes into account a high
degree of flexibility allowed under the proposed financing terms
to further leverage the balance sheet, as well as make payments
to shareholders. The rating is calibrated to the key assumption
that the new owner will prioritize deleveraging, even in what
Moody's expects to be a lower growth environment.

Rating Outlook

The stable outlook on the ratings reflect Moody's expectation
that Taminco is likely to retain solid operating momentum in
2012, supported by geographic diversification of its revenues and
on-going improvements in the US operations.

Rating Sensitivities

A sustained reduction in Total Debt with leverage falling
substantially below 4x and strong FCF/Debt coverage in high
single digits, as well as strong liquidity position, would likely
put positive pressure on the rating.

Ratings may be lowered, should the company's leverage increases
above 5x and debt interest coverage decline with (FFO +
Interest)/Interest trending at or below 2x.

Liquidity

Taminco is expected to continue to manage its liquidity in a
proactive manner. Moody's expects that the company should
maintain a robust operating momentum and generate positive
operating cash flows. Following the closing of the acquisition,
the company will have access to US$198 million revolver (expected
to be undrawn on closing) and EUR100 million (US$132 million
equivalent) receivables factoring facility. The revolver facility
has maintenance covenants and Moody's expects the company to
maintain sufficient headroom under the covenants in the medium
term. Taminco will have no material near term maturities.

Structural Considerations

The one notch uplift of the rating on the bank facilities to
(P)B1 /LGD 3 (32) is driven by the significant size of the junior
bond obligations in the proposed structure, also reflected in the
lower provisional ratings of the notes at (P)Caa1/LGD 5 (86). The
first lien bank facilities and second lien notes will benefit
from the pledge of substantially all assets of the acquired
business and will be supported by senior secured guarantees to be
offered by subsidiaries representing c. 93% of consolidated
revenues and 96% of consolidated total assets (as of the end of
3Q 2011).

Moody's highlights a significant degree of financial flexibility
allowed by the proposed terms with regard to incurring additional
secured and unsecured debt, including to finance acquisitions, as
well as with respect to making restricted payments to
shareholders.

Incorporated in Delaware, USA, and headquartered in Ghent,
Belgium, Taminco Global Chemical Corporation ("Taminco") will be
the largest independent producer of alkylamines and alkylamine
derivatives, that are used in various end markets in agriculture,
water treatment, personal care, nutrition and several industrial
applications. Taminco operates in 17 countries, and has seven
production facilities with installed capacity of 1,256kt in 2011,
prior to the recent closure of 35 kt capacity in Brazil. Its
largest facility is in Gent, Belgium.

For 2010, Taminco Group NV reported EUR715 million in revenues
and EUR101 million in EBIT (EUR617 million in revenues and EUR82
million in EBIT for 9 months of 2011). At the end of September
2011, Taminco Group NV reported EUR1,025 million in total assets,
(including EUR421 million in goodwill).

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


TAMINCO GLOBAL: S&P Assigns 'B+' Long-Term Corp. Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' long-term
corporate credit rating to Belgium-headquartered chemical
producer Taminco Global Chemical Corp. The outlook is stable.

"The issue ratings on the proposed US$198 million senior secured
revolving credit facility (RCF) due in 2017, and the US$452
million senior secured term loan B (TLB) due in 2019 are 'BB-',
one notch higher than the corporate credit rating. The recovery
rating on these instruments is '2', indicating our expectation of
substantial (70%-90%) recovery prospects for debtholders in the
event of a payment default," S&P said.

"The issue rating on the proposed US$452 million second-priority
senior secured notes due in 2020 is 'B-', two notches lower than
the corporate credit rating. The recovery rating on this
instrument is '6', indicating our expectation of negligible (0%-
10%) recovery prospects for debtholders in the event of a
payment default," S&P said.

"The company and issue ratings are based on the draft debt
documents presented to us, and subject to our review of final
terms and conditions. Any change could affect the ratings.
Potential changes include, but are not limited to, financial and
other covenants, amortization profile, maturity, size and number
of lines, interest rate, committed nature, security, ranking,
guarantees, and the transaction funding mix of debt versus
equity," S&P said.

"The financial risk profile, which we classify as 'aggressive,'
is the main rating constraint. We assess the company's business
risk profile as 'satisfactory,'" S&P said.

"U.S.-based leveraged buyout (LBO) investor Apollo Global
Management is in the process of purchasing Taminco. The purchase
price of around US$1.4 billion should be funded with 63% of debt,
equally split between syndicated bank lines and bonds, and 37% of
equity, not shareholder loans or similar. Our base-line scenario
projects significant additional debt once the transaction closes,
with modest deleveraging capabilities in the medium term. We
estimate FFO to debt of about 12% in 2012 and 2013," S&P said.

"We expect Taminco to remain resilient to economic downturns
because of the end markets it sells to such as nutrition, oil and
gas production, water treatment, and agrochemicals. During the
2008-2009 global crisis, EBITDA and volumes held up very well.
The company has a diversified end market mix and favorable growth
prospects. A key positive point is its light exposure to the
construction and auto end markets, in marked contrast to many
other chemical companies. We also notice that, in some cases,
Taminco benefits from take-or-pay contracts with very large
clients, pointing to sound industry characteristics and favorable
demand," S&P said.

"The stable outlook reflects our assumption that the company will
have resilient EBITDA of about EUR170 million-EUR180 million in
2012 amid probable weakening economic conditions. We also expect
FFO to debt of 12%, which we view as commensurate with the
rating. We also foresee no acquisitions or shareholder
distribution in 2012, and moderate amounts, if any, thereafter,"
S&P said.

"We might consider a negative rating action if the company
decided to make acquisitions or shareholder distributions big
enough to push credit metrics below the level commensurate with
the rating. Macroeconomic conditions threatening EBITDA levels or
an inability to pass on feedstock or energy prices could also be
negative for the ratings," S&P said.

"A raise in the ratings in 2012 is unlikely given the private-
equity ownership and modest 2012-2013 deleveraging capabilities
in our base-case scenario. Rating upside in the long term is
possible, but would primarily hinge on our view of financial
policies tied to potential shareholder distributions and
acquisitions," S&P said.


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F R A N C E
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ALCATEL-LUCENT: Moody's Withdraws 'B2' Senior Debt Ratings
----------------------------------------------------------
Moody's Investors Service has withdrawn the ratings of the
unguaranteed legacy bonds issued by Lucent Technologies Inc.
(renamed to Alcatel-Lucent USA, Inc.) and its subsidiary Lucent
Technologies Capital Trust because it believes it has
insufficient information to support the maintenance of the
ratings. Alcatel-Lucent USA Inc. is both, an operating and
intermediate holding company primarily for the US operations of
the group and owing about half of the group's debt. The ratings
for two convertible bonds of Alcatel-Lucent USA, which have been
guaranteed on a subordinated basis by Alcatel-Lucent, the parent
company of the group, have been downgraded to B3 from B2, i.e.
one notch below the senior unsecured rating of the guarantor to
reflect the subordinated status of the guarantee. Since financial
statements of Alcatel-Lucent USA Inc. are not available to
Moody's, the issuer's intrinsic credit quality cannot be assessed
at this time.

Alcatel-Lucent's debt ratings have been maintained at B1 for the
Corporate Family Rating (CFR) and Probability of Default Rating
(PDR) and the outlook as negative. The instrument ratings
maintained include the ratings for senior debt of Alcatel-Lucent
S.A. at B2, LGD5 (75%). The ratings for the unguaranteed senior
debt instruments of Lucent Technologies, Inc. (previously: B2,
LGD5 (75%)) and for the trust-preferred securities issued by
Lucent Technologies Capital Trust (previously: B3, LGD6 (95%))
have been withdrawn.

Ratings Rationale

Moody's has withdrawn the rating because it believes it has
insufficient information to support the maintenance of the
rating.

The principal methodology used in rating Alcatel-Lucent was the
Global Communications Equipment Industry Methodology published in
June 2008. 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 Paris, France, Alcatel-Lucent is one of the
world leaders in providing advanced solutions for
telecommunications systems and equipment to service providers,
enterprises and governments. The company achieved sales of
EUR11.4 billion in the first nine months 2011.


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G E R M A N Y
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Q-CELLS SE: Can't Defer Payment of EUR202-Mil. Corporate Bond
-------------------------------------------------------------
Stefan Nicola at Bloomberg News reports that a regional court
said Q-Cells SE can't defer payment of a EUR202 million
(US$263 million) corporate bond due next month.

Bloomberg relates that the company said holders of the 2012 bonds
will receive partial payments in tranches as it seeks to
restructure convertible bonds due in 2014 and 2015 in a debt-to-
equity swap.  It forecast operating losses through 2013,
Bloomberg notes.

According to Bloomberg, Q-Cells Chief Executive Officer Nedim Cen
said on a conference call said that the company is in "intensive
talks" with creditors to organize partial repayment of the bond
by the end of February.

"We are on a good path and there are concrete suggestions for
solutions on the table," Bloomberg quotes Mr. Cen as saying.  An
insolvency "is not up for discussion at the moment."

Q-Cells SE is a German solar cell and module maker.


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G R E E C E
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VESTJYSK BANK: Bankruptcy Unlikely, Investment Newsletter Says
--------------------------------------------------------------
Frances Schwartzkopff at Bloomberg News reports that Vestjysk
Bank A/S, the regional bank that may ask the Danish government to
take a stake, jumped the most in more than two decades in
Copenhagen trading after a local investment newsletter said it
was a good buy.

Vestjysk Bank advanced as much as 34%, the most since at least
October 1989, making it the biggest mover on Copenhagen's stock
exchange on Monday, Jan. 23, Bloomberg relates.  The shares
gained DKK4.80 to DKK19.10, giving the lender a market value of
DKK239 million (US$41.9 million), Bloomberg discloses.

According to Bloomberg, the bank is a "super attractive lottery
ticket," AktieUgebrevet, a weekly newsletter for private
investors, wrote in this week's edition published on Monday.
Bloomberg notes that the low share price reflects a "bankruptcy-
like scenario," which the newsletter said was "unlikely."

Vestjysk Bank said on Jan. 19 it may convert some state-held
hybrid capital to shares, Bloomberg recounts.  The lender,
Bloomberg says, needs to refinance about DKK1.38 billion in
state-backed bonds by 2014 and was told by financial regulators
in December to write down DKK550 million more in loans.  The
bank's shares hit a two-decade low on Jan. 10 after local media
reported it failed to get support from Denmark's biggest banks
for a DKK500 million share issue, Bloomberg states.

Vestjysk Bank A/S is a Lemvig, Denmark-based lender.


* GREECE: EU Ministers Reject Private Bondholders' Debt Offer
-------------------------------------------------------------
Bruno Waterfield, Angela Monaghan and Harry Wilson at The
Telegraph reports that talks to restructure Greece's debt hit a
new impasse after eurozone finance ministers rejected an offer
from private bondholders because the cost of sweeteners on new
Greek bonds were too high.

Eurozone ministers have demanded that negotiations between the
Greek government and Institute of International Finance (IIF)
reach agreement on a lower average coupon, or interest rate, on
new Greek bonds issued in return for a haircut on existing debt
held by private investors, the Telegraph discloses.

"The ministers have sent the offer back for negotiations," the
Telegraph quotes an official on Monday.  "The ministers want a
lower coupon than presented in the offer."

The offer, negotiated during tense talks that rattled markets
last week, assumed an average coupon on new Greek bonds of 4%,
the Telegraph notes.

The new bonds, likely to have maturity of 30 years, would replace
existing Greek debt as sweetener for writing down existing Greek
bonds owned by banks and private investors, the Telegraph says.

According to the Telegraph, the International Monetary Fund (IMF)
has insisted that the coupon rate must not exceed 3.5% on average
if the deal is to reduce the currently unsustainable burden of
Greek debt to manageable levels.

If the coupon is 4% then the cost for Germany and other eurozone
countries of a second Greek bailout in March will rise beyond a
EUR30 billion figure earmarked for sweetening a debt write down
for the private sector, the Telegraph states.

Jean-Claude Juncker, head of the eurozone finance ministers'
group, on Monday confirmed that the group wants a rate below 4%
and insisted that rates must be on average 3.5% or below until
2020, the Telegraph relates.

Eurozone officials have insisted that there are no plans to
increase the EUR130 billion of official financing for Greece
under a second bailout package agreed in October, the Telegraph
notes.

A deal with its private creditors is a precondition for Greece to
get the second bail-out from its eurozone partners, after it
received EUR110 billion in May 2010, the Telegraph discloses.

Angela Merkel, the German Chancellor, said there would be no
question of a temporary loan for Greece if the private-sector
involvement (PSI) dragged on, the Telegraph recounts.

Wolfgang Schaeuble, the German finance minister, said he wanted a
second bail-out program for Greece to be in place by March, the
Telegraph relates.

Athens faces a March 20 deadline to repay EUR14.4 billion in
debt, the Telegraph states.


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BANK OF IRELAND: S&P Affirms 'BB+/B' Counterparty Credit Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services, following the resolution of
the sovereign CreditWatch and its review of the Irish Banking
Industry Country Risk Assessment (BICRA), has reviewed the
ratings on four Irish banks:

    Bank of Ireland,
    Barclays Bank Ireland PLC,
    Irish Life & Permanent PLC, and
    Ulster Bank Ireland Ltd. (together with its U.K. parent,
    Ulster Bank Ltd.).

"In each case we have affirmed the long-term and short-term
counterparty credit ratings on the bank and removed the ratings
from CreditWatch negative. The outlooks are negative," S&P said.

"We had placed these four banks on CreditWatch with negative
implications on Dec. 7 and Dec. 8, 2011, after we placed the
Irish sovereign on CreditWatch. As a result of the rating
actions, all of our rated Irish banks now have a negative
outlook, except for Irish Bank Resolution Corporation Limited
(IBRC; CCC+/Developing/C)," S&P said.

"Our BICRA for Ireland, which is in group '7', is unaffected by
the resolution of the CreditWatch on the Republic of Ireland
(BBB+/Negative/A-2) on Jan. 13, 2012, when we affirmed the Irish
sovereign ratings with a negative outlook. We are maintaining our
economic risk score at '7', and our industry risk score at '7,'"
S&P said.

"Our updated view of the Irish sovereign includes in part our
view that weaker-than-expected external demand may lower economic
growth. This has not affected our assessment of 'economic
resilience' as 'intermediate risk.' Economic resilience is one of
the three components of our BICRA economic risk score. Our view
of 'credit risk in the economy' (another component) as 'very high
risk' is also unaffected, even though we consider that the
banking system's credit losses through 2013 may be a little
higher than we had previously assumed," S&P said.

"In addition, our view of 'systemwide funding,' one of the three
components of our BICRA industry risk score, as 'very high risk'
remains unchanged as it already incorporated the inability of
Irish banks to adequately access external funding. We observe
that total customer deposit levels have become more stable in
recent months, declining at a much slower pace than previously,
and that the banks appear to be making adequate progress in
meeting their deleveraging requirements. Meanwhile, we had
already factored ongoing high reliance upon European Central Bank
and central bank facilities into our 'systemwide funding'
assessment," S&P said.

"The rating factors are slightly different for each rated bank.
In all cases, the negative outlook is consistent with our view
that while the Irish government has executed strongly on its
fiscal consolidation, the economy, government finances, and the
banks continue to be at risk from a marked and sustained
deterioration in the external environment," S&P said.

"Our ratings on IBRC, Allied Irish Banks PLC (BB/Negative/B), and
KBC Bank Ireland PLC (BBB-/Negative/A-3) were not affected when
we placed the Irish sovereign on CreditWatch," S&P said.

Ratings List
The ratings listed are counterparty credit ratings.

Affirmed; Off Watch
                            To                  From
Bank of Ireland             BB+/Negative/B     BB+/Watch Neg/B
Barclays Bank Ireland PLC   A-/Negative/A-2    A-/Watch Neg/A-2
Irish Life & Permanent PLC  BB-/Negative/B     BB-/Watch Neg/B
Ulster Bank Ltd.            BBB+/Negative/A-2  BBB+/Watch Neg/A-2
Ulster Bank Ireland Ltd.    BBB+/Negative/A-2  BBB+/Watch Neg/A-2


ISAACS HOSTEL: Goes Into Liquidation
------------------------------------
The Irish Times reports that Isaacs Hostel, one of Ireland's
best-known hostels, has been put into liquidation.

Isaacs Hostel on Frenchman's Lane, Hotel Isaacs, which fronts on
to Store Street, and the nearby Jacob's Hostel on Talbot Place
have been closed since Jan. 10, the report says.

The Irish Times relates that Moore Stephens Nathans was appointed
as liquidator to the company following a meeting of the company's
creditors on Jan. 9.

The management company behind the three accommodation providers,
the Dublin Tourist Hostel Ltd, was incorporated in 1981.  Its
directors are listed as Anne Breslin, Richard Evans and Basil
Good, according to the Companies' Registration Office.

The liquidator may be reached at:

          MOORE STEPHENS NATHANS
          Ulysses House, Foley St
          Dublin 1, Ireland
          Tel: +353 (0)1 888 1004
          Fax: +353 (0)1 888 1005


JURYS AND BERKELEY: Syndicate Lenders Take Over Operations
----------------------------------------------------------
Ciaran Hancock at The Irish Times reports that a syndicate of
lenders led by Ulster Bank on Saturday appointed Dalata Hotel
Group to manage the Jurys and Berkeley Court hotels in
Ballsbirdge for an initial one-year term.

There are also 16 apartments on the seven-acre site, which are
all let, the Irish Times notes.

According to the Irish Times, the transfer came after lengthy
negotiations between owner Sean Dunne and the banks recently over
an exit strategy for the developer. It is understood the lenders
were preparing to go to the High Court this week to gain control
of the hotels but Mr. Dunne finally agreed to step aside on
Saturday, the Irish Times relates.

Mr. Dunne bought Jurys hotel for EUR275 million and paid
EUR125 million for the Berkeley Court, which was then a five-star
hotel, the Irish Times discloses.


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


TIRRENIA DI NAVIGAZIONE: Compagnia Italiana Faces EU Probe
----------------------------------------------------------
Bloomberg News reports that Compagnia Italiana di Navigazione Srl
faces an in-depth European Union probe into a plan to buy
Tirrenia di Navigazione SpA, Italy's insolvent state-owned ferry
operator.

According to Bloomberg, the European Commission said there were
"serious competition concerns" over the high market shares held
by CIN's owners Marinvest Srl, Grimaldi Compagnia di Navigazione
SpA and Onorato Partecipazioni Srl, which has joint control over
Italian ferry company Moby SpA.  It set a deadline of June 4 to
rule on the deal, the report says.

Bloomberg relates that regulators said in an e-mailed statement
the companies "have very high, if not monopolistic, combined
market shares on a number of maritime routes in Italy, and in
particular on certain routes to and from Sardinia."

As reported by the Troubled Company Reporter-Europe on Aug. 16,
2010, Bloomberg News said that a Rome judge on Aug. 12 declared
Tirrenia insolvent, the first step toward placing the company
under state administration.  Bloomberg disclosed Italy failed
this month to sell Tirrenia and on Aug. 5 approved "emergency
financial provisions" to help guarantee ferry services.  The sale
was pulled after the government did not reach a final agreement
with bidder Mediterranea Holding, according to Bloomberg.

Italy-based Tirrenia di Navigazione SpA, founded in 1936, runs
passenger and cargo ships linking the mainland with islands
Sardinia, Sicily and Corsica as well as Albania.


* ITALY: Corporate Bankruptcies Rise in 2011, Cerved Says
---------------------------------------------------------
ANSA, citing Italian business analysis and credit-risk agency
Cerved, reports that bankruptcies shot up in 2011, with over
12,000 companies closing.

ANSA relates that small and medium-sized enterprises with assets
between EUR2 and EUR10 million were hardest hit, closely followed
by those with assets between EUR10 and EUR50 million.

The insolvency ratio, which measures the frequency of defaults,
was up 10% in 2011, compared to 2010, with all areas of Italy
being affected, except the northeast, ANSA notes.


===================
K A Z A K H S T A N
===================


BTA BANK: Fitch Cuts Long-Term Issuer Default Rating to 'RD'
------------------------------------------------------------
Fitch Ratings has downgraded Kazakhstan-based BTA Bank's (BTA)
Long-term Issuer Default Rating (IDR) to 'RD' from 'C'.

The downgrade reflects the fact that the bank has committed an
uncured expiry on January 18, 2012 of a grace period allowed to
pay a US$165 million coupon.  The bank has confirmed its
intention to seek restructuring of its obligations under senior
unsecured and subordinated bonds with the aggregate value of
about US$3.5 billion.

Fitch has affirmed BTA's senior unsecured rating at 'C' since
defaulted obligations are typically not assigned 'RD' and 'D'
ratings, but are instead rated in the 'B' to 'C' rating
categories, depending upon their recovery prospects.

The national welfare fund Samruk Kazyna has held a 81.5% stake in
BTA since the completion of the bank's restructuring in 2010.

The rating actions are as follows:

BTA

  -- Long-term foreign and local currency IDRs downgraded to 'RD'
     from 'C'
  -- Short-term foreign and local currency IDRs downgraded to
     'RD' from 'C'
  -- Viability Rating affirmed at 'f'
  -- Individual Rating affirmed at 'F'
  -- Support Rating affirmed at '5'
  -- Support Rating Floor revised to 'NF' from 'C'
  -- Senior unsecured rating affirmed at 'C'; Recovery Rating at
     'RR5'
  -- Subordinated debt rating affirmed at 'C'; Recovery Rating at
     'RR6'


KAZAKH MORTGAGE: Fitch Lowers Rating on Class C Notes to 'CCCsf'
----------------------------------------------------------------
Fitch Ratings has downgraded Kazakh Mortgage Backed Securities
2007-I B.V. (Kazakh MBS), as follows:

  -- Class A (ISIN XS0293196266): downgraded to 'BB-sf'from
     'BB+sf'; Outlook Negative; RWN removed

  -- Class B (ISIN XS0293196696): downgraded to 'Bsf' from
     'B+sf'; Outlook Negative; RWN removed

  -- Class C (ISIN XS0293196779): downgraded to 'CCCsf' from 'B-
     sf'; RWN removed

Kazakh MBS is a securitization of mortgage loans originated by
BTA Ipoteka (BTAI), a wholly-owned subsidiary of BTA Bank (rated
'RD').  The transaction closed in March 2007 and as of January
2012 was amortized to around 13% of the original issuance
balance.

The downgrades and Negative Outlooks on the notes reflect the
numerous uncertainties in relation to (i) the removal of the USD-
indexation of the mortgage loans, which will result in a
immediate reduction on the collateral amount denominated in USD
and expose the transaction to future exchange rate fluctuation;
and (ii) BTA's recently announced debt restructuring, as
reflected by its current 'RD' rating.

The agency estimated that the removal of the USD-indexation would
dilute the mortgage portfolio as of end-November by around 31%,
to US$17.2 million from US$25.1 million.  However, credit
enhancement would remain at 45.5% for the class A, 22.3% for the
class B and 7.8% for the class C due to the existing
overcollateralization and the cash reserve in the transaction.
Fitch's estimate assumes that for each loan which still has an
outstanding balance, the balance would be redefined as the
original amount, net of any historical payments in excess of the
interest due had the loan not been USD-indexed.  The transaction
will also be exposed to exchange rate fluctuation.  Fitch
currently estimates that a depreciation of KZT relative to USD by
more than 9% could impair the class C notes.

The actual impact of the USD-indexation removal is subject to
several uncertainties.  It could be significantly more harmful if
the borrowers whose loan are now repaid in full were entitled to
claim back from BTAI excess payments made pursuant to the
indexation mechanism.  This would impact the transaction if BTAI
can claim back these amounts against the issuer, which Fitch
considers unlikely.

The announcement of BTA's second debt restructuring raises
concerns about servicing risk for the transaction. Even if called
in by the transaction trustee, Fitch believes the named back-up
servicer is unlikely to step in.  However, based on the last
restructuring in 2010, Fitch currently sees a continuation of
BTA's servicing operations as likely.

The portfolio performance deteriorated during 2011. Fitch
calculates a distress rate, which measure the percentage of
arrear loans repurchased from the issuer.  This increased to 4.7%
in 2011 from 2%-3% in 2009/29010.  However, the agency does not
consider this to be a threat to the credit quality of the notes,
given the healthy levels of excess spread in the transaction
(between 5% and 10% annualized in 2011).

Fitch will continue to monitor the transaction and take the
appropriate rating actions if necessary.


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


BASE CLO I: S&P Affirms Rating on Class E Notes at 'B+'
-------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
BASE CLO I B.V.'s class A-1, A-2, B, and C notes. "At the same
time, we affirmed our ratings on the class D1, D2, and E notes,"
S&P said.

"The rating actions follow our performance review of the
transaction and the application of our 2010 counterparty
criteria," S&P said.

"Since our last review in February 2010, we have observed a
relatively positive rating migration of the performing assets in
the portfolio, with a decrease of 'CCC' rated assets to 2.9% from
7.0%. However, defaulted assets have increased to 5.0% from 1.3%.
The aggregate collateral balance has dropped to EUR225 million
from EUR355 million, primarily through amortization, but also
through losses from defaulted assets," S&P said.

"Except for the class E notes, which are the most sensitive in
the transaction to losses, the credit enhancement available to
each class of notes has improved because the issuer has applied
amortization proceeds to pay down the notes in a sequential
order, starting with the class A1 notes. Other positive factors
in our analysis include a reduction of the portfolio's weighted-
average life (WAL--see below), and an increase of the weighted-
average spread (WAS) to 2.76% from 2.54%," S&P said.

"We have subjected the transaction's capital structure to a cash
flow analysis to determine the break-even default rate for each
rated class. We used the portfolio balance that we consider to be
performing, the reported weighted-average spread, and the
weighted-average recovery rates that we consider to be
appropriate. We incorporated various cash flow stress scenarios
using our short default patterns (the WAL has fallen to 3.3 years
from 5.1), levels, and timings for each rating category assumed
for each class of notes, in conjunction with different interest
stress scenarios. As the portfolio is static and has already
significantly amortized, we took into account the potential
impact of spread and recovery compressions in our analysis," S&P
said.

"Non-euro assets denominated in U.S. dollars and British pounds
sterling account for nearly 30% of the underlying portfolio, and
the resulting foreign currency risk is hedged via perfect asset
swaps with JP Morgan Chase Bank, N.A. (A+/Stable/A-1) as swap
counterparty. We have also stressed the transaction's sensitivity
to and reliance on the swap counterparty, especially for senior
classes of notes rated higher than JPMorgan, by applying foreign
exchange stresses to the notional amount of non-euro assets. Our
analysis showed that the class A1 notes could withstand a 'AAA'
stress under these conditions, whereas the class A2 notes, which
would otherwise pass at a 'AAA' rating level, could not," S&P
said.

"Therefore, and in accordance with our analysis detailed above,
we have raised our ratings on the class A1, A2, B, and C notes to
levels that we consider to reflect the current levels of credit
enhancement, the portfolio credit quality, and the transaction's
performance," S&P said.

"We have also observed that the credit support available to the
junior notes is commensurate with their current ratings, and we
have therefore affirmed our ratings on the class D-1, D-2, and E
notes," S&P said.

BASE CLO I is a cash flow collateralized loan obligation (CLO)
transaction backed primarily by leveraged loans to speculative-
grade corporate firms. Geographically, the portfolio is
concentrated in the U.K., Germany, and France, which together
account for nearly 65% of the portfolio. BASE CLO I closed in
April 2008 and is serviced by M&G Investment Management Ltd.

              Standard & Poor's 17g-7 Disclosure Report

SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and
a description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26, 2011.

If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:

         http://standardandpoorsdisclosure-17g7.com

Ratings List

Class                Rating
            To                   From

BASE CLO I B.V.
EUR375 Million Senior and Subordinated Deferrable Floating-Rate
Notes

Ratings Raised

A-1         AAA (sf)             AA (sf)
A-2         AA+ (sf)             AA- (sf)
B           A+ (sf)              BBB+ (sf)
C           BBB+ (sf)            BBB- (sf)

Ratings Affirmed

D1          BB+ (sf)
D2          BB+ (sf)
E           B+ (sf)


OPERA FINANCE: Moody's Lowers Rating on Class A Notes to 'Caa3'
---------------------------------------------------------------
Moody's Investors Service has downgraded the Class A Notes issued
by Opera Finance (Uni-Invest) B.V. (amount reflects initial
outstandings):

   EUR656M Class A Notes 2005 due 2012 Notes, Downgraded to Caa3
   (sf); previously on Jul 15, 2011 Downgraded to B3 (sf)

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

Ratings Rationale

The downgrade action reflects the high likelihood of a note event
of default on the legal final maturity date of the Notes on
February 15, 2012 and the increased uncertainty around the
recoveries available to the Class A Notes following the
suspension of the auction process for the sale of the property
company which was initiated by the special servicer in September
2011. Given the short term remaining until legal final maturity
of the Notes, Moody's does not expect the potential recoveries to
be allocated to the Class A Notes on the payment date in February
2012 at which time the rating of the Notes will be withdrawn.

The key parameters in Moody's analysis are the expected
enforcement process and related costs as well as Moody's value
assessment for the properties and/or the property company
securing the loan. Moody's derives from those parameters the
level of expected recoveries for the securitized loan.

In general, Moody's analysis reflects a forward-looking view of
the likely range of commercial real estate collateral performance
over the medium term. From time to time, Moody's may, if
warranted, change these expectations. Performance that falls
outside an acceptable range of the key parameters such as
property value or loan refinancing probability for instance, may
indicate that the collateral's credit quality is stronger or
weaker than Moody's had anticipated when the related securities
ratings were issued. Even so, a deviation from the expected range
will not necessarily result in a rating action nor does
performance within expectations preclude such actions.

Primary sources of assumption uncertainty are the current
stressed macro-economic environment and continued weakness in the
occupational and lending markets. Moody's anticipates (i) delayed
recovery in the lending market persisting through 2013, while
remaining subject to strict underwriting criteria and heavily
dependent on the underlying property quality, (ii) strong
differentiation between prime and secondary properties, with
further value declines expected for non-prime properties, and
(iii) occupational markets will remain under pressure in the
short term and will only slowly recover in the medium term in
line with anticipated economic recovery. Overall, Moody's central
global macroeconomic scenario is for a material slowdown in
growth in 2012 for most of the world's largest economies fueled
by fiscal consolidation efforts, household and banking sector
deleveraging and persistently high unemployment levels.

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 in some countries, which could result in rating
downgrades.

Opera Finance (Uni-Invest) B.V. is a true sale single loan
transaction that closed in May 2005. The securitized loan is the
senior portion of a senior/junior loan (together the "whole
loan") structure secured by first-ranking security over initially
321 commercial properties all located in The Netherlands. By
November 2011, 118 properties had been disposed of. The
predominant property types are office and industrial. The current
senior loan balance is EUR603.6 million and the junior loan
balance is EUR160.5 million (including capitalized interest). As
per latest interest payment date, the balance of the Class A
Notes is EUR360.0 million. The loan defaulted on its scheduled
maturity date in February 2010 and has been in special servicing
since.

The most recent third-party valuation of the portfolio from April
2011 valued the portfolio as EUR634 million, indicating an
underwriter loan-to-value on the securitized debt of 96% and 119%
on the whole loan. The same valuation attributed a EUR400 million
value to a fire-sale scenario within six months. The auction
process which was initiated by the special servicer has attracted
interest; however, according to the special servicer, the bids
received would not result in a sale transaction on terms
acceptable to the special servicer. The reason for the
unsatisfactory bids is linked to the limited availability of
financing in the market.

Moody's understands that the Class A noteholders are forming a
steering committee that the special servicer would consult with
in regards to the future work-out/enforcement process. In light
of the suspension of the auction process and the limited
visibility on the enforcement route, Moody's has lowered its
recovery expectation for the Class A Noteholders. The downgrade
to Caa3 reflects Moody's lower expected recovery for the Notes
together with the high level of variability around the ultimate
recoveries.

Rating Methodology

The methodologies used in this rating were Moody's Approach to
Real Estate Analysis for CMBS in EMEA: Portfolio Analysis (MoRE
Portfolio) published in April 2006, and Update on Moody's Real
Estate Analysis for CMBS Transactions in EMEA published in June
2005.

Other Factors used in this rating are described in EMEA CMBS:
2011 Central Scenarios published in February 2011.

The updated assessment is a result of Moody's ongoing
surveillance of commercial mortgage backed securities (CMBS)
transactions. Moody's prior assessment is summarized in a press
release dated July 15, 2011. The last Performance Overview for
this transaction was published on November 17, 2011.

In rating this transaction, Moody's assumed a work-out of the
loan post legal final maturity of the Notes. As a note event of
default is highly likely to occur due to non-payment of the final
principal amounts owed to the Class A Notes, Moody's considered
the Class A to rank ahead of the subordinated notes in the
payment of interest and principal (i.e. following the post-
enforcement waterfall). With respect to the amount of principal
recovery available to the Class A Notes, Moody's considered
several options available to the Note Trustee and noteholders.
However, the limited visibility around the enforcement has
resulted in Moody's estimating a high variability around the
recoveries available to the Class A Notes which is reflected in
the rating of the Notes.


PDM CLO I: S&P Raises Rating on Class E Notes to 'CCC+'
-------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
PDM CLO I B.V.'s class A, B, C, and E notes. "At the same time,
we affirmed our rating on the class D notes," S&P said.

PDM CLO I is a cash flow collateralized loan obligation (CLO)
transaction that closed in December 2007. It securitizes loans to
primarily speculative-grade corporate firms.

"The rating actions follow our assessment of the transaction's
performance, using data from the latest available trustee report
(dated Nov. 21, 2011) and a cash flow analysis. We have taken
into account recent transaction developments and our relevant
criteria for CLOs," S&P said.

"Our analysis indicates that the portfolio's credit quality has
improved. We have seen an increase in the weighted-average spread
earned on the collateral pool, of 13 basis points since the time
of our last rating action. We have also observed that the
transaction's overcollateralization test results have improved
for all classes of notes," S&P said.

"We have subjected the capital structure to a cash flow analysis
to determine the break-even default rate for each rated class. In
our analysis, we have used the reported portfolio balance that we
consider to be performing (rated 'CCC-' or above), the principal
cash balance, the current weighted-average spread, and the
weighted-average recovery rates that we consider to be
appropriate. We have incorporated various cash flow stress
scenarios using various default patterns, levels, and timings for
each liability rating category, in conjunction with different
interest rate stress scenarios," S&P said.

"Taking into account our credit and cash flow analyses, along
with our 2010 counterparty criteria and our cash flow criteria,
we consider that the increased credit quality of the collateral
portfolio and the increase in the weighted-average spread earned,
is commensurate with higher ratings on the class A, B, C, and E
notes than previously assigned. We have therefore raised our
ratings on these classes of notes," S&P said.

"We have affirmed our rating on the class D notes. This rating
was constrained by the application of our largest obligor default
test -- a supplemental stress test we introduced in our 2009
criteria update for corporate collateralized debt obligations
(CDOs)," S&P said.

              Standard & Poor's 17g-7 Disclosure Report

SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and
a description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26,
2011," S&P said.

If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:

        http://standardandpoorsdisclosure-17g7.com

Rating List
Class               Rating
              To             From

PDM CLO I B.V.
EUR300 Million Secured Floating-Rate and Subordinated Notes

Ratings Raised

A             AA- (sf)       A+ (sf)
B             A+ (sf)        BBB+ (sf)
C             BBB+ (sf)      BB+ (sf)
E             CCC+ (sf)      CCC- (sf)

Rating Affirmed

D             B+ (sf)


PEARL MORTGAGE: Moody's Lowers Rating on Class B Notes to 'Ba2'
---------------------------------------------------------------
Moody's Investors Service has (i) upgraded the credit ratings to
the senior Class A notes; (ii) assigned definitive ratings to the
new subordinated Class S notes; and (iii) affirmed the ratings of
the junior Class B notes issued by PEARL Mortgage Backed
Securities 2 B.V. (amounts reflect initial outstandings):

   -- EUR800M Senior Class A Mortgage-Backed Floating Rate Notes
      due 2046, Upgraded to Aaa (sf); previously on August 14,
      2009 Downgraded to Aa2 (sf)

   -- EUR44M Subordinated Class S Notes Mortgage-Backed Floating
      Rate Notes due 2046, Definitive Rating Assigned Baa1 (sf)

   -- EUR8.1M Junior Class B Notes Mortgage-Backed Floating Rate
      Notes due 2046, Affirmed at Ba2 (sf); previously on August
      14, 2009 Downgraded to Ba2 (sf)

PEARL Mortgage Backed Securities 2 B.V. (Pearl 2) closed in June
2007 and represents the second securitization of Dutch
residential mortgage loans which all have the benefit of a
"Nationale Hypotheek Garantie" (NHG) guarantee originated by SNS
Bank N.V. (Baa1/Prime-2). The assets supporting the notes, which
amount to EUR852.1 million, are prime mortgage loans secured on
residential properties located throughout the Netherlands.

Ratings Rationale

The rating action follows the restructuring of Pearl 2 completed
on December 19, 2011 which comprised the following amendments:

-- New subordinated Class S notes. Since the Class S notes were
created from a corresponding reduction in the existing Class A
notes, the total note balance of the transaction remained
unaffected. However, the total credit enhancement, in the form of
subordination, under the Class A notes increased substantially to
6.4% from 1.0% at closing. Within the pre-enforcement priority of
payments interest and principal payments to the Class S
noteholders rank junior to the Class A but senior to the Class B
noteholders.

-- Margin on the Class A Notes increased to 0.46% from 0.03% at
closing with no further increase of step-up margin for the Class
A or S noteholders. All note interest and step-up (for class B)
note interest is covered under the interest rate swap with BNP
Paribas.

Furthermore, in January 2012, the Sellers agreed not to offer any
further substitution assets to the Issuer and the Trustee
confirmed that it will not purchase any further mortgage
receivables from the Sellers. This terminates the substitution
period which was permitted up to June 2014 at closing.

The ratings of the notes takes into account the credit quality of
the underlying mortgage loan pool, from which Moody's determined
the MILAN Aaa Credit Enhancement and the portfolio expected loss.

The expected portfolio loss of 0.15% (previously 0.13%) and the
MILAN Aaa required Credit Enhancement of 4.2% (previously 4.3%)
served as input parameters for Moody's cash flow model, which is
based on a probabilistic lognormal distribution as described in
the report "The Lognormal Method Applied to ABS Analysis",
published in July 2000.

The key drivers for the slightly lower MILAN Aaa Credit
Enhancement number following the restructure is the fact that i)
the structure is no longer revolving and as a result there is no
flexibility to add new mortgage loans up to the portfolio limits;
ii) the weighted average loan-to-foreclosure-value (LTFV) of
94.3% (compared to 94.2% at closing), which is in line with other
prime Dutch RMBS transactions; iii) the proportion of interest-
only loan parts (36%); and (iv) the weighted average seasoning of
5.7years.

The key drivers for the portfolio expected loss are (i) the
performance of the seller's books and existing HERMES and Pearl
transactions; (ii) benchmarking with comparable (NHG)
transactions in the Dutch RMBS market; and (iii) the current
economic conditions in the Netherlands in combination with
historic recovery data of foreclosures received from the seller.
Given the historical performance of the Dutch RMBS market and the
originators, Moody's believes the assumed expected loss is
appropriate for this transaction. The expected loss is in line
with other Dutch NHG transactions.

Another key characteristic of this transaction is that
approximately 37% of the portfolio is linked to life insurance
policies (life mortgage loans), which are exposed to set-off risk
in case an insurance company goes bankrupt. The seller has not
provided loan-by-loan insurance company counterparty data and
instead provided a partial list of counterparty names that
provide life insurance policies in the pool. Based on the
available data over 46% of the counterparty exposure is linked to
policies provided by subsidiaries of SNS REAAL N.V. Moody's
considered the set-off risk in the cash flow analysis.

The transaction benefits from an excess margin of 25 bps through
the swap agreement. The swap counterparty is currently BNP
Paribas (novated from SNS Bank in June 2010). The transaction
benefits from additional liquidity via a cash advance sized at
2.25% of the initial notes outstanding with a floor of 1.0%. The
transaction does not benefit from a reserve fund.

Moody's Parameter Sensitivities: At the time the rating was
assigned, the model output indicated that subordinated Class S
would have achieved Baa3 if the expected loss was as high as
0.45% assuming MILAN Aaa CE increased to 7.5% and all other
factors remained the same. Applying the same sensitivity, the
model output indicated that the Class A (following the completion
of the restructure) would have achieved Aa3. Moody's Parameter
Sensitivities provide a quantitative/model-indicated calculation
of the number of rating notches that a Moody's structured finance
security may vary if certain input parameters used in the initial
rating process differed. The analysis assumes that the deal has
not aged and is not intended to measure how the rating of the
security might migrate over time, but rather how the initial
rating of the security might have differed if key rating input
parameters were varied. Parameter Sensitivities for the typical
EMEA RMBS transaction are calculated by stressing key variable
inputs in Moody's primary rating model.

The V-Score for this transaction: is Low/Medium, which is in line
with the V-Score assigned for the Dutch RMBS sector, mainly due
to the fact that it is a standard Dutch prime RMBS structure for
which Moody's has over 10 years of historical performance data on
precedent transactions. The primary source of uncertainty relates
to operational risks relating to the servicing arrangement. The
contractual servicer is SNS Bank. V-Scores are a relative
assessment of the quality of available credit information and of
the degree of dependence on various assumptions used in
determining the rating. High variability in key assumptions could
expose a rating to more likelihood of rating changes. The V-Score
has been assigned according to the report "V-Scores and Parameter
Sensitivities in the Major EMEA RMBS Sectors" published in April
2009.

The methodologies used in this rating were Moody's Approach to
Rating RMBS in Europe, Middle East and Africa published in
October 2009, Moody's Updated MILAN Methodology for Rating Dutch
RMBS published in October 2009, Cash Flow Analysis in EMEA RMBS:
Testing Structural Features with the MARCO Model (Moody's
Analyser of Residential Cash Flows) published in January 2006,
Moody's Updated Approach to NHG Mortgages in Rating Dutch RMBS
published in March 2009, and Moody's Updated Methodology for Set-
Off in Dutch RMBS published in November 2009.

Other Factors used in this rating are described in The Lognormal
Method Applied to ABS Analysis published in July 2000, and Global
Structured Finance Operational Risk Guidelines: Moody's Approach
to Analyzing Performance Disruption Risk published in June 2011.

In rating this transaction, Moody's used ABSROM to model the cash
flows and determine the loss for each tranche. The cash flow
model evaluates all default scenarios that are then weighted
considering the probabilities of the lognormal distribution
assumed for the portfolio default rate. In each default 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. Therefore, the
expected loss or EL for each tranche is the sum product of (i)
the probability of occurrence of each default scenario; and (ii)
the loss derived from the cash flow model in each default
scenario for each tranche.

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 in some countries, which could result in rating
downgrades.

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

The rating addresses the expected loss posed to investors by the
legal final maturity of the notes. In Moody's opinion, the
structure allows for timely payment of interest and principal
with respect of the notes by the legal final maturity. Moody's
ratings only address the credit risk associated with the
transaction. Other non-credit risks have not been addressed, but
may have a significant effect on yield to investors.


PEARL MORTGAGE: Moody's Affirms Rating on Class B Notes at 'Ba2'
----------------------------------------------------------------
Moody's Investors Service has (i) upgraded the credit ratings to
the senior Class A notes; (ii) assigned definitive ratings to the
new subordinated Class S notes; and (iii) affirmed the ratings of
the junior Class B notes issued by PEARL Mortgage Backed
Securities 1 B.V. (amounts reflect initial outstandings):

   -- EUR1000M Senior Class A Mortgage-Backed Floating Rate Notes
      due 2047, Upgraded to Aaa (sf); previously on August 14,
      2009 Downgraded to Aa2 (sf)

   -- EUR64M Subordinated Class S Notes Mortgage-Backed Floating
      Rate Notes due 2047, Definitive Rating Assigned Baa1 (sf)

   -- EUR13.7M Junior Class B Notes Mortgage-Backed Floating Rate
      Notes due 2047, Affirmed at Ba2 (sf); previously on August
      14, 2009 Downgraded to Ba2 (sf)

PEARL Mortgage Backed Securities 1 B.V. (Pearl 1) closed in
September 2006 and represents the first securitization of Dutch
residential mortgage loans which all have the benefit of a
"Nationale Hypotheek Garantie" (NHG) guarantee originated by SNS
Bank N.V. (Baa1/Prime-2). Currently, the transaction is still in
its revolving period (pool factor is 100%) until September 2015.
The assets supporting the notes, which amount to EUR1,077.7
million, are prime mortgage loans secured on residential
properties located throughout the Netherlands.

Ratings Rationale

The rating action follows the restructuring of Pearl 1 completed
on December 19, 2011 which mainly comprised the following
amendment:

-- New subordinated Class S notes. Since the Class S notes were
created from a corresponding reduction in existing Class A notes,
the total note balance of the transaction remained unaffected.
However, the total credit enhancement, in the form of
subordination, under the Class A notes increased substantially to
7.7% from 1.35% at closing. Within the pre-enforcement priority
of payments interest and principal payments the Class S
noteholders rank junior to the Class A but senior to the Class B
noteholders.

The ratings of the notes takes into account the credit quality of
the underlying mortgage loan pool, from which Moody's determined
the MILAN Aaa Credit Enhancement and the portfolio expected loss
as well as the transaction structure and any legal considerations
as assessed in Moody's cash flow analysis.

The expected portfolio loss of 0.15% (previously 0.13%) and the
MILAN Aaa required Credit Enhancement of 4.7% (previously 4.3%)
served as input parameters for Moody's cash flow model, which is
based on a probabilistic lognormal distribution as described in
the report "The Lognormal Method Applied to ABS Analysis",
published in July 2000.

The key drivers for the higher MILAN Aaa Credit Enhancement
number following the restructure is the fact that (i) the
weighted average loan-to-foreclosure-value (LTFV) of 97.3%
(compared to 99.4% at closing), which is in line with other prime
Dutch RMBS transactions; (ii) the availability of the NHG-
guarantee for 100% of the loans in the pool; (iii) the proportion
of interest-only loan parts of 37.3% (with a substitution limit
of 56.9%) which is slightly lower than for other prime Dutch RMBS
transactions; and (iv) the weighted average seasoning of 6.0
years.

The key drivers for the portfolio expected loss are (i) the
performance of the seller's books and existing HERMES and Pearl
transactions; (ii) benchmarking with comparable (NHG)
transactions in the Dutch RMBS market; and (iii) the current
economic conditions in the Netherlands in combination with
historic recovery data of foreclosures received from the seller.
Given the historical performance of the Dutch RMBS market and the
originators', Moody's believes the assumed expected loss is
appropriate for this transaction. The expected loss is inline
with other Dutch NHG transactions.

Another key characteristic of this transaction is that
approximately 20% of the portfolio is linked to life insurance
policies (life mortgage loans), which are exposed to set-off risk
in case an insurance company goes bankrupt. The seller has not
provided loan-by-loan insurance company counterparty data and
instead provided a partial list of counterparty names that
provide life insurance policies in the pool. Based on the
available data over 35% of the counterparty exposure is linked to
policies provided by (subsidiaries of) SNS REAAL N.V. Moody's
considered the set-off risk in the cash flow analysis.

The transaction benefits from an excess margin of 25 bps through
the swap agreement. The swap counterparty is currently BNP
Paribas (novated from SNS Bank in June 2010 ). The transaction
benefits from additional liquidity via a cash advance sized at
2.25% of the initial notes outstanding with a floor of 1.0%. The
transaction does not benefit from a reserve fund.

Moody's Parameter Sensitivities: At the time the rating was
assigned, the model output indicated that subordinated Class S
would have achieved Baa2 if the expected loss was as high as
0.45% assuming MILAN Aaa CE increased to 6.7% and all other
factors remained the same. Applying the same sensitivity, the
model output indicated that the Class A (following the completion
of the restructure) would have achieved Aa2. Moody's Parameter
Sensitivities provide a quantitative/model-indicated calculation
of the number of rating notches that a Moody's structured finance
security may vary if certain input parameters used in the initial
rating process differed. The analysis assumes that the deal has
not aged and is not intended to measure how the rating of the
security might migrate over time, but rather how the initial
rating of the security might have differed if key rating input
parameters were varied. Parameter Sensitivities for the typical
EMEA RMBS transaction are calculated by stressing key variable
inputs in Moody's primary rating model.

The V-Score for this transaction: is Low/Medium, which is in line
with the V-Score assigned for the Dutch RMBS sector, mainly due
to the fact that it is a standard Dutch prime RMBS structure for
which Moody's has over 10 years of historical performance data on
precedent transactions. The primary source of uncertainty relates
to operational risks relating to the servicing arrangement. The
contractual servicer is SNS Bank. V-Scores are a relative
assessment of the quality of available credit information and of
the degree of dependence on various assumptions used in
determining the rating. High variability in key assumptions could
expose a rating to more likelihood of rating changes. The V-Score
has been assigned according to the report "V-Scores and Parameter
Sensitivities in the Major EMEA RMBS Sectors" published in April
2009.

The methodologies used in this rating were Moody's Approach to
Rating RMBS in Europe, Middle East and Africa published in
October 2009, Moody's Updated MILAN Methodology for Rating Dutch
RMBS published in October 2009, Cash Flow Analysis in EMEA RMBS:
Testing Structural Features with the MARCO Model (Moody's
Analyser of Residential Cash Flows) published in January 2006,
Moody's Updated Approach to NHG Mortgages in Rating Dutch RMBS
published in March 2009, and Moody's Updated Methodology for Set-
Off in Dutch RMBS published in November 2009.

Other Factors used in this rating are described in The Lognormal
Method Applied to ABS Analysis published in July 2000, and Global
Structured Finance Operational Risk Guidelines: Moody's Approach
to Analyzing Performance Disruption Risk published in June 2011.

In rating this transaction, Moody's used ABSROM to model the cash
flows and determine the loss for each tranche. The cash flow
model evaluates all default scenarios that are then weighted
considering the probabilities of the lognormal distribution
assumed for the portfolio default rate. In each default 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. Therefore, the
expected loss or EL for each tranche is the sum product of (i)
the probability of occurrence of each default scenario; and (ii)
the loss derived from the cash flow model in each default
scenario for each tranche.

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 in some countries, which could result in rating
downgrades.

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

The rating addresses the expected loss posed to investors by the
legal final maturity of the notes. In Moody's opinion, the
structure allows for timely payment of interest and principal
with respect of the notes by the legal final maturity. Moody's
ratings only address the credit risk associated with the
transaction. Other non-credit risks have not been addressed, but
may have a significant effect on yield to investors.


===========
P O L A N D
===========


POLKOMTEL SA: S&P Withdraws 'B+' Long-Term Corp. Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'B+' long-term
corporate credit rating on Polish telecoms operator Polkomtel
S.A. at the issuer's request.

At the time of the withdrawal, Polkomtel had no Standard &
Poor's-rated debt outstanding.


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


COMBOIS DE PORTUGAL: S&P Cuts Corporate Credit Rating to 'CCC+'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term
corporate credit and nonguaranteed issue ratings on Portuguese
rail operator Comboios de Portugal E.P.E (CP) to 'CCC+' from 'B-
'. "In addition, we removed all the ratings from CreditWatch,
where they were placed with negative implications on Dec. 8,
2011. The outlook is negative," S&P said.

"We have also assigned a recovery rating of '4' to CP's EUR200
million nonguaranteed and unsecured notes, indicating our
expectation of average (30%-50%) recovery for these noteholders
in the event of a default," S&P said.

The rating actions on CP follow similar actions on the Republic
of Portugal (BB/Negative/B) on Jan. 13, 2012.

"In accordance with our criteria for government-related entities
(GREs), a two-notch downgrade of Portugal results in a one-notch
downgrade of CP," S&P said.

"We factor into our 'CCC+' rating on CP three notches of uplift
from its stand-alone credit profile (SACP), which we assess at
'cc', in accordance with our criteria for GREs. This reflects our
opinion that there is a 'very high' likelihood that the Republic
of Portugal would provide timely and sufficient extraordinary
support to CP in the event of financial distress," S&P said. This
view is based on S&P's assessment of CP's:

    "Very important" role for the Portuguese government, given
    that CP is in effect the only provider of passenger rail
    transport in Portugal and is the predominant freight carrier.

    "Very strong" link with the Republic of Portugal, given CP's
    100% state ownership and its strong legal status as a public
    entity.

"In accordance with our criteria 'How Standard & Poor's Uses Its
'CCC' Rating,' we consider the 'CC' category more appropriate
where we see that a company is at substantial risk of default
generally within six months, and especially when a default date
can be determined. While we generally anticipate issuers in the
'CC' category or, as in this instance, with an SACP of 'cc', to
incur a payment default fairly imminently, in some instances
companies find resources to continue operations for a longer
period," S&P said.

"The negative outlook on CP reflects that on the Republic of
Portugal. It also takes into account potential deviations from
the EU/International Monetary Fund economic reform program
targets that could result in delayed disbursement of multilateral
loans to the government. Such deviations are likely to undermine
the level of state support to CP. Should these deviations occur,
we could lower the sovereign ratings, as well as revise our view
of the likelihood of support to CP from the Portuguese
government. This would then lead to a downgrade of CP," S&P said.

"Conversely, we could revise the outlook on CP to stable if we
see a longer-term solution to the company's weak liquidity and
ongoing refinancing needs," S&P said.


PORTUGAL TELECOM: S&P Cuts Corporate Credit Ratings to 'BB+/B'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term and
short-term corporate credit ratings on Portuguese
telecommunications provider Portugal Telecom SGPS S.A. to 'BB+/B'
from 'BBB-/A-3' and removed them from CreditWatch with negative
implications where S&P placed them on Dec. 8, 2011. The outlook
is negative.

"At the same time, we have assigned a 'BB+/B' corporate credit
rating to Portugal Telecom International Finance B.V. (PTIF), a
direct wholly owned issuing entity of Portugal Telecom, and a
recovery rating of '3' on PTIF's senior unsecured debt,
reflecting our expectation of 50%-70% recovery prospects in the
event of a default," S&P said.

The downgrade follows the lowering of the long- and short-term
sovereign ratings on the Republic of Portugal to 'BB/B' from
'BBB-/A-3' on Jan. 13, 2012 and the assignment of a negative
outlook.

"According to our criteria for rating an entity in the European
Economic and Monetary Union above the sovereign, we have assessed
Portugal Telecom as having 'high' exposure to domestic country
risks. Therefore, an up to one notch maximum rating differential
can apply between the rating on an entity and a speculative-grade
sovereign rating," S&P said.

"The negative outlook on Portugal Telecom primarily reflects the
risk of a downgrade over the next two years if the sovereign
ratings on Portugal decline further. The negative outlook also
reflects the risk that adverse capital markets may impede likely
required refinancing to prepare for 2014 maturities, and that
macroeconomic conditions -- notably consumer spending,
unemployment, or adverse effects of fiscal adjustment measures --
could weaken Portugal Telecom's revenues and EBITDA more than we
currently expect in our base case. Overall, despite likely
positive free cash flows, we think that Portugal Telecom's
future dividend distribution could prevent the company from
generating meaningful positive discretionary cash flows, which
could both weaken liquidity and our credit metrics for the
company," S&P said.

"We could revise the outlook to stable if the rating on the
sovereign stabilizes and Portugal Telecom's liquidity does not
deteriorate," S&P said.


REDE FERROVIARIA: S&P Lowers Corporate Credit Rating to 'CCC+'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term
corporate credit and nonguaranteed issue ratings on Portuguese
rail infrastructure manager Rede Ferroviaria Nacional REFER
E.P.E. (REFER) to 'CCC+' from 'B-'. "In addition, we removed all
the ratings from CreditWatch, where they were placed with
negative implications on Dec. 8, 2011. The outlook is negative,"
S&P said.

"We have also assigned a recovery rating of '4' to REFER's EUR1.1
billion nonguaranteed notes, indicating our expectation of
average (30%-50%) recovery for these noteholders in the event of
a default," S&P said.

The rating actions on REFER follow similar actions on the
Republic of Portugal (BB/Negative/B) on Jan. 13, 2012.

"In accordance with our criteria for government-related entities
(GREs), a two-notch downgrade of Portugal results in a one-notch
downgrade of REFER," S&P said.

"We factor into our 'CCC+' rating on REFER three notches of
uplift from its stand-alone credit profile (SACP), which we
assess at 'cc', in accordance with our criteria for rating GREs.
This reflects our opinion that there is a 'very high' likelihood
that the Republic of Portugal would provide timely and sufficient
extraordinary support to REFER in the event of financial
distress," S&P said. This view is based on S&P's assessment of
REFER's:

    "Very important" role for the Portuguese government, given
    REFER's natural monopoly position as the national rail
    infrastructure manager; and

    "Very strong" link with the Portuguese government, given
    REFER's 100% state ownership and its strong legal status as a
    public entity, which prevents bankruptcy and privatization.

"In accordance with our criteria 'How Standard & Poor's Uses Its
'CCC' Rating,' we consider the 'CC' category more appropriate
where we see that a company is at substantial risk of default
generally within six months, and especially when a default date
can be determined. While we generally anticipate issuers in the
'CC' category or, as in this instance, with an SACP of 'cc', to
incur a payment default fairly imminently, in some instances
companies find resources to continue operations for a longer
period," S&P said.

"The negative outlook on REFER reflects that on the Republic of
Portugal. It also takes into account potential deviations from
the EU/International Monetary Fund economic reform program
targets that could result in delayed disbursement of multilateral
loans to the government. Such deviations are likely to undermine
the level of state support to REFER. Should these deviations
occur, we could lower our ratings on Portugal and revise our view
of the likelihood of extraordinary and timely support from the
Portuguese government to REFER. This would then lead us to
downgrade REFER," S&P said.

"Conversely, we could revise the outlook on REFER to stable if we
see a longer-term solution to the company's 'weak' liquidity and
ongoing refinancing needs," S&P said.


* PORTUGAL: Second Bailout Likely; May Not Return to Market
-----------------------------------------------------------
Patricia Kowsmann at The Wall Street Journal reports that
investors, economists and politicians are increasingly concerned
that Portugal will need a second bailout as fears mount that it
won't be able to return to markets for financing next year.

According to the Journal, while the Portuguese government's
finances are covered this year as long as it abides by its
bailout agreement, Portugal must regain full access to capital
markets next year to help repay EUR9 billion (US$11.64 billion)
in debt coming due in September 2013.

While that date is still far off, the International Monetary Fund
could require Portugal to present its financing plans a full year
ahead before releasing more aid, as it did with Greece, the
Journal notes.  And as with Greece, the IMF may demand fresh
bailout terms if it becomes clear the country won't be able to
return to market in a year, the Journal says.  Given the yields
demanded by investors on Portugal's bonds, economists fear that
may become the case, the Journal notes.

Portugal's bond prices have fallen sharply since Standard &
Poor's Corp. downgraded the debt to junk two weeks ago and amid
fears that Greece's debt restructuring will pave the way for
other countries to do the same in the future, the Journal
relates.

Over the weekend, Prime Minister Pedro Passos Coelho acknowledged
pressure on Portugal was growing because of instability among
euro-zone countries and the S&P downgrade, the Journal discloses.
He has said the country doesn't need more money or time to
implement its program, the Journal recounts.

The downgrade, which made S&P the third major ratings company to
rate Portugal's debt as junk, was largely in response to
uncertainty the entire euro zone is facing, the Journal states.

In Lisbon, government officials and politicians are increasingly
frustrated that Portugal's own commitment to the bailout may not
be enough to appease the market, the Journal notes.

Bond yields and the cost of insuring Portuguese debt against
default have reached record levels, prompting investors to say
that holders of Portugal's debt could suffer losses on their
investments, as they did in Greece, according to the Journal.


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


MOSCOW INTEGRATED: Fitch Revises Outlook on 'BB+' IDR to Stable
---------------------------------------------------------------
Fitch Ratings has revised the Outlook on OJSC Moscow Integrated
Power Company's (MIPC) Long-term foreign currency and local
currency Issuer Default Ratings (IDR) of 'BB+' to Stable from
Positive.

The Outlook change follows Fitch's revision of the City of
Moscow's Outlook to Stable from Positive and the affirmation of
its Long-term foreign and local currency IDRs at 'BBB' on
January 18, 2012.

MIPC's ratings are notched down by two levels from those of the
City of Moscow, its majority shareholder, and reflect their
strong operational and strategic ties, in accordance with Fitch's
'Parent and Subsidiary Rating Linkage' dated August 12, 2011.
The agency assesses MIPC's stand-alone creditworthiness in the
mid-'BB' rating category.

The rating actions are as follows:

  -- Long-term foreign currency IDR: affirmed at 'BB+'; Outlook
     revised to Stable from Positive

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

  -- Local Currency Long-term IDR: affirmed at 'BB+'; Outlook
     revised to Stable from Positive

  -- National Long-term rating: affirmed at 'AA(rus)'; Outlook
     revised to Stable from Positive

  -- National Short-term rating: affirmed at 'F1+(rus)'

  -- Senior unsecured rating: affirmed at 'BB+'/AA(rus)


TENEX-SERVICE: S&P Lifts Counterparty Credit Ratings From 'BB+/B'
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its long- and short-
term counterparty credit ratings on Russia-based leasing company
TENEX-Service to 'BBB-/A-3' from 'BB+/B'. "We also raised our
Russia national scale rating to 'ruAAA' from 'ruAA+'. The outlook
is stable," S&P said.

"The rating action reflects our view that there is a stronger
likelihood that TENEX would receive extraordinary support from
its parent, Atomic Energy Power Corp. (AtomEnergoProm;
BBB/Stable/A-3; Russia national scale 'ruAAA'), the state-owned
nuclear monopoly in Russia. We recently raised the long-term
rating on AtomEnergoProm and, in our opinion, the improvement in
the parent's credit quality, combined with its continued ongoing
support, result in an enhanced likelihood of extraordinary
parental support to TENEX in case of need," S&P said.

"We note that TENEX remains fully strategically and operationally
integrated in AtomEnergoProm. Under TENEX's business model, funds
from AtomEnergoProm are channelled to its subsidiaries, creating
leasing tax benefits for the industry. About 73% of TENEX's total
lease portfolio is related to nuclear companies, with funding
fully provided by AtomEnergoProm. The performance of TENEX's
lease portfolio and the stability of its funding rely heavily on
the credit quality of its parent. The long-term rating on TENEX
is now one notch below that on AtomEnergoProm, incorporating four
notches of uplift above its stand-alone credit profile (sacp),
which we assess at 'b+'," S&P said.

"We also consider TENEX a government-related entity (GRE) because
of its unique market role as the only leasing company in Russia
that is eligible to possess nuclear equipment (according to the
President's Act No. 556). However, we think that TENEX has only a
'limited' role and 'limited' link to the government, and expect
that external support is likely to be through its parent, which
is also a GRE," S&P said.

"TENEX's lease portfolio is performing well, in our view, and no
payments are currently overdue. We consider that TENEX is far
less exposed to a loss of market confidence than average in the
leasing industry because 100% of its funding comes from its
parent. TENEX's capitalization remains a weakness, in our view,"
S&P said.

"The stable outlook reflects our expectation that TENEX will
continue to benefit from its high level of strategic and
operational integration with the parent and maintain the adequate
quality of its lease portfolio," S&P said.


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


TDA 26-MIXTO: Fitch Affirms Rating on Class 2-C Notes at 'CCCsf'
----------------------------------------------------------------
Fitch Ratings has affirmed TDA 26-Mixto, Fondo de Titulizacion de
Activos, as follows:

  -- Class 1-A2 (ISIN ES0377953015): affirmed at 'AAAsf'; Outlook
     Stable
  -- Class 1-B (ISIN ES0377953023): affirmed at 'Asf'; Outlook
     Stable
  -- Class 1-C (ISIN ES0377953031): affirmed at 'BBBsf'; Outlook
     revised to Negative from Stable
  -- Class 1-D (ISIN ES0377953049): affirmed at 'CCCsf'; Recovery
     Estimate (RE) of 80%
  -- Class 2-A (ISIN ES0377953056): affirmed at 'AAAsf'; Outlook
     Stable
  -- Class 2-B (ISIN ES0377953064): affirmed at 'BBBsf'; Outlook
     Stable
  -- Class 2-C (ISIN ES0377953072): affirmed at 'CCCsf'; Recovery
     Estimate (RE) of 45%

TDA 26 Mixto's notes were issued in 2006 and are backed by
mortgage loans originated and serviced by Banco Guipuzcoano
('BBB+'/RWN/'F2') and Banca March (not rated by Fitch).  The
transaction comprises two groups of notes.  The Group 1 notes are
backed by a portfolio of mortgage participations (participaciones
hipotecarias or PHs), which are first-ranking mortgage loans with
loan-to-value ratios (LTVs) of less than 80%.  The Group 2 notes
are backed by a portfolio of mortgage certificates (certificados
de transmission de hipoteca, CTHs), which are first and second-
lien mortgage loans with LTVs over 80%.

The transaction features a provisioning mechanism whereby
defaulted loans, defined as loans in arrears by more than 12
months, are fully provisioned using excess spread generated by
the structure.

For Group 1, the affirmation reflects the sufficient build-up in
credit enhancement available to the notes, driven by the
deleveraging of the pool since close.  The underlying assets in
the portfolio are highly seasoned (87 months as of the November
2011 collection period), while the current LTV for the same
period was 48.0%.  Despite the prime nature of the underlying
assets in the Group 1 pool, there has been a noticeable increase
in the volume of three-months plus arrears in recent months.  As
of November 2011, the portion of borrowers in arrears by more
than three months stood at 1.4% of the current portfolio,
compared to 0.5% 12 months earlier.  The rise in late-stage
arrears has translated into an increase in the volume of defaults
recognized in the period, which exceeded the excess spread amount
generated by the transaction, and therefore led to a reserve fund
draw in the October 2011 interest payment date (IPD).

As of November 2011, cumulative gross defaults stood at 0.9% of
the initial portfolio balance, with levels of recoveries reported
at levels higher than those seen in some other Spanish RMBS
transactions.  Cumulative recoveries were reported at 52.9% of
cumulative gross defaults.  While Fitch expects excess spread to
remain stable in the next 18 months, the Negative Outlook on the
1-C notes reflects the likelihood of further reserve fund draws,
as the late-stage arrears continue to roll-through to default.

Despite the more adverse nature of the underlying assets in Group
2, the performance of the loans in the pool has remained stable,
as reflected in the affirmation of the notes, which Fitch expects
will continue in the next 18 months.  The agency also expects the
reserve fund to continue amortizing from its current level of
2.6% of Group 2's note balance over the next 18 months, therefore
limiting the further growth in credit enhancement of the notes.
For this reason, Fitch has maintained a Stable Outlook on all
three tranches of the Group 2 notes.

As Banca March is not a Fitch-rated entity, the agency has
assessed the exposure of these portions of the pools (39.5% for
Group 1 and 84.2% for Group 2) to commingling and payment
interruption risks in case of default of the bank.  There are
currently no commingling reserve or back-up servicer arrangements
in place to mitigate these risks.  In its analysis, Fitch used
the minimum reserve fund amount expected to be available in the
next 18 months in order to assess the liquidity that would be
available to the structure in the event of insolvency of Banca
March.  The agency found that the funds expected to be available
to the structure were sufficient to cover for medium-term losses
or liquidity shortfalls, which is why the notes were affirmed.


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


FERROMET: To Discuss Debt Repayment with Creditors Tomorrow
-----------------------------------------------------------
Janie Davies at Metal Bulletin reports that Ferromet will meet
creditors on Thursday to discuss the payment of outstanding debts
and a proposal for the structure of its Kosovan chrome
subsidiary.

The company, Metal Bulletin says, is undergoing a restructuring,
which hinges on the sale of the chrome assets, and said in August
it plans to clear all debts.

Under the new proposal, it plans to pay creditors 25% of what
they are owed in the form of a composition dividend, according to
correspondence seen by Metal Bulletin.  Creditors will also be
granted an additional dividend based on the outcome of the
transfer of the business, which will be calculated in relation to
the creditor's claim, Metal Bulletin discloses.

Ferromet requested the restructuring in June after it accumulated
debts and had its funding pulled by Danske Bank, Metal Bulletin
recounts.  According to Metal Bulletin, a spokesman for the
company confirmed in August that the company had been spending
money to support the underperforming chrome assets, Metal
Bulletin notes.  It has been operating under the supervision of
its lawyers since the restructuring was approved, Metal Bulletin
states.  The initial deadline for completion was late August, but
the company has since been granted two extensions, saying it is
moving closer to a deal, Metal Bulletin discloses.

Ferromet had debts to the value of SEK52.7 million
(US$7.8 million) last summer, Metal Bulletin says, citing
documents filed with Sweden's bankruptcy court in June.

Ferromet is a Swedish ferro-alloys trading house


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


PETROPLUS HOLDINGS: To File for Insolvency After Debt Talks Fail
----------------------------------------------------------------
Petroplus Holdings AG disclosed that the company and its
subsidiaries received notices of acceleration on Monday from the
lenders under its Revolving Credit Facility.  During the past
several weeks, Petroplus has been negotiating with these lenders
to reopen credit lines needed to maintain operations and meet
financial obligations.  In addition, the Company has been
seeking to arrange alternative financing and liquidity
facilities, as well as other strategic options.

The negotiations with the lenders under the Revolving Credit
Facility have not been successful (despite the Company having
reached an agreement for crude oil supply) and they have served
notices of acceleration, commenced enforcement actions and
appointed a receiver in respect of Petroplus Marketing AG's
assets in the UK.  Such acceleration constitutes an event of
default under the U$1.75 billion aggregate principal amount of
outstanding senior notes and convertible bonds of Petroplus
Finance Limited.  The primary goal of Petroplus' Board of
Directors is to ensure that operations are safely shut down and
to preserve value for all stakeholders.  The Board of Directors
has resolved to prepare for a filing for insolvency or
composition proceedings ("Nachlassstundung") in Switzerland and
will make the necessary filings as soon as possible.  Similar
steps are being taken by Petroplus subsidiaries in various
jurisdictions.  The filing of insolvency proceedings by any
entity that is a guarantor of the senior notes, including
Petroplus Holdings AG, Petroplus Refining and Marketing Ltd. and
Petroplus Holdings France SAS, will result in an automatic
acceleration of the senior notes.

Jean-Paul Vettier, Petroplus' Chief Executive Officer, said, "It
is unfortunate to have reached the point where the Executive
Committee and Board of Directors have to inform our employees,
shareholders, bondholders and other stakeholders about these
circumstances.  We have worked hard to avoid this
outcome, but were ultimately not able to come to an agreement
with our lenders to resolve these issues given the very tight and
difficult European credit and refining markets.  We are fully
aware of the impact that this will have on our workforce, their
families and the communities where we have operated our
businesses."

Based in Zug, Switzerland, Petroplus Holdings AG is Europe's
largest independent oil refiner.

                          *     *     *

As reported by the Troubled Company Reporter-Europe on Jan. 20,
2012, Standard & Poor's Ratings Services lowered its long-term
issuer credit ratings on Switzerland-based refiner Petroplus
Holding AG to 'CC' from 'CCC+'.  "At the same time, we lowered
our long-term issue ratings on senior unsecured notes totaling
US$1.6 billion and a US$150 million convertible bond issued by
finance subsidiary Petroplus Finance Ltd. (Bermuda) to 'C' from
'CCC'.  The recovery ratings of '5' on all rated instruments
remain unchanged," S&P said.


PETROPLUS HOLDINGS: Halts Coryton Deliveries; Shares Suspended
--------------------------------------------------------------
Nidaa Bakhsh at Bloomberg News reports that Petroplus Holdings
AG, which is trying to avoid bankruptcy, halted deliveries from
its U.K. plant after lenders forced it to stop selling the fuel.

"With Coryton unable to let delivery lorries leave its premises,
it is clear this is now make or break both for the refinery and
for its parent company," Bloomberg quotes Richard Howitt, a
European Parliament member for the east of England, as saying in
a statement on Monday, citing managers and workers at the plant.
Lenders have "imposed a condition preventing Coryton from
continuing with deliveries".

Petroplus is fighting to avert collapse after lenders halted
about US$1 billion in credit lines last month, preventing crude
purchases for its five plants, Bloomberg discloses.  It had
managed to keep Coryton and a refinery at Ingolstadt in Germany
running at reduced capacity, Bloomberg notes.

Meanwhile, Will Kennedy at Bloomberg News reports that Petroplus
asked for its shares to be suspended from trading on Monday.

As reported by the Troubled Company Reporter-Europe on Jan. 23,
2012, Bloomberg News related that Petroplus said the company may
sell three of its five oil refineries in Europe.  Petroplus said
in a statement on Friday that the company has started a "sales
process" for its Petit Couronne refinery in France and is
"evaluating strategic alternatives" for its Antwerp plant in
Belgium and Cressier site in Switzerland, according to Bloomberg.

Based in Zug, Switzerland, Petroplus Holdings AG is Europe's
largest independent oil refiner.

                          *     *     *

As reported by the Troubled Company Reporter-Europe on Jan. 20,
2012, Standard & Poor's Ratings Services lowered its long-term
issuer credit ratings on Switzerland-based refiner Petroplus
Holding AG to 'CC' from 'CCC+'.  "At the same time, we lowered
our long-term issue ratings on senior unsecured notes totaling
US$1.6 billion and a US$150 million convertible bond issued by
finance subsidiary Petroplus Finance Ltd. (Bermuda) to 'C' from
'CCC'.  The recovery ratings of '5' on all rated instruments
remain unchanged," S&P said.


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


VESTEL ELEKTRONIK: S&P Affirms 'B-' Corporate Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Turkish
home appliance and electronics manufacturer Vestel Elektronik
Sanayi Ve Ticaret A.S. (Vestel) to positive from stable. The 'B-'
long-term corporate credit rating on Vestel was affirmed.

"At the same time, we affirmed our 'B-' issue rating on the $225
million notes, due May 2012, issued by Vestel's subsidiary Vestel
Electronics Finance Ltd. The recovery rating is unchanged at
'4,'" S&P said.

"In May 2012, Vestel will have to repay its US$225 million bond,
which is now classified as short-term debt. The company has
already repurchased close to US$126 million in bonds using bank
debt, and plans to repay the remaining US$99 million of bond debt
later in 2012. If Vestel refinances the bond with medium-
or long-term debt, its liquidity position could improve
sufficiently for us to consider raising the ratings," S&P said.

"The rating affirmation reflects the company's strong operating
performance in 2011, including 21% growth in revenues in the
first nine months of 2011 and an increase of the EBITDA margin to
10.6% from 8.8% for the full year 2010. We believe that this
improvement is sustainable and the company will be able to
maintain its profitability at this level over the next 12 months.
The EBITDA growth translated into improved debt ratios, including
a reduction of adjusted debt to EBITDA to 2.4x as of Sept. 30,
2011, from 4.3x on Dec. 31, 2010. We believe Vestel might be able
to deleverage further as we anticipate positive discretionary
cash flow (DCF) for the company in 2012," S&P said.

"The ratings reflect our view of Vestel's high reliance on
various forms of short-term funding, its volatile leverage,
looming debt maturities, and volatile operating performance.
These factors partly reflect uneven macroeconomic conditions in
Turkey and foreign exchange rate volatility. The ratings also
reflect what we consider to be weak and volatile cash generation,
mainly fueled by working capital swings. These weaknesses are
only partly mitigated, in our view, by the shareholders'
demonstrated support, the group's cost-efficient manufacturing, a
reducing debt burden, and Vestel's rising market share in the
European TV market, after weathering the challenging transition
to flat-screen TVs," S&P said.

"The positive outlook reflects the likelihood that we would raise
the ratings on Vestel if its liquidity improves over the next 12
months. We believe Vestel's liquidity could improve if it
refinances the bond maturing in May 2012 with medium- or long-
term debt, which could reduce the company's exposure to short-
term financing. However, an upgrade would also depend on the
group's operating performance staying in line with our base-case
scenario," S&P said.

"Our base-case assessment factors in positive DCF in 2012,
rollover of various types of short-term debt facilities, and
maintenance of covenant headroom of at least 15%-20%," S&P said.

The upside rating potential could be diluted if the company
refinanced the bond with short-term debt or if it is unable to
generate positive DCF on a sustainable basis.


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


AVOCET HARDWARE: Goes Into Administration, Seeks Buyer
------------------------------------------------------
DIY Week reports that Avocet Hardware has been placed in
administration.

Andrew Stoneman and Ben Wiles, both of the financial advisory and
investment banking firm Duff & Phelps, have been appointed joint
administrators to the firm, and are continuing to trade the
business while seeking a buyer, according to DIY Week.

In December 2011, DIY Week recalls that Avocet sold its loss-
making Chinese factory, which makes door and window hardware.

DIY Week relates that Mr. Stoneman said Avocet Hardware's
financial performance in recent years was adversely impacted by
losses from the Chinese operation, and by the insolvency of "a
major customer" -- assumed to be Focus DIY.  Focus went under in
2011 owing Avocet Hardware a total of GBP430,00, the report
relays.

Mr. Stoneman said discussions are ongoing with a number of
different parties who wish to acquire all or parts of the
business, the report adds.

The administrators can be reached at:

         Andrew Stoneman
         Ben Wiles
         Duff & Phelps
         43-45 Portman Square
         London, W1H 6LY
         Tel: +44 (0)20 7487 7240
         Fax: +44 (0)20 7487 7299
         E-mail: andrew.stoneman@duffandphelps.com
                 benjamin.wiles@duffandphelps.com

Headquartered in Brighouse, West Yorks, Avocet Hardware was
established in 1978 and operates through three UK divisions:
builders hardware, door and window hardware, and high-security
locks.  It employs 150 people.


CRT RECYCLING: EA Rules Force Firm to Enter Insolvency
------------------------------------------------------
Neil Roberts at MRW reports that CRT Recycling said it has been
forced into closure by Environment Agency rules.  The company
said it was seeking insolvency advice following meetings with the
agency and its bank.

According to the report, the new guidance, which came into effect
on Christmas Day 2011, relates to the storage of CRTs to prevent
the release of "hazardous coatings" and lead and glass dust.  An
EA document said that in certain circumstances, CRTs must be
stored or handled in an enclosed environment, MRW says.

Managing director Carl Kruger told MRW the company had
"essentially been given three months to change everything."

MRW relates that Mr. Kruger said in order to comply with the new
rules the firm would have had to "either build new buildings and
put in extraction systems, or concrete over a large area of
land".

Mr. Kruger said it would have cost "hundreds of thousands of
pounds" to continue, the report relates.

Mr. Kruger, as cited by MRW, said the EA "didn't require us to
close down, they required us to do things that would make us
close down".

Mr. Kruger also criticised the agency for not consulting the
company before introducing the new guidance and claimed the
company had been forced to use Freedom of Information legislation
to obtain documents, MRW adds.

Flintshire-based CRT Recycling is a cathode ray tube recycling
company.


GEORGE WHITE: Enters Administration, Cuts 61 Jobs
-------------------------------------------------
Mary Vancura at Business Sale reports that George White Motors
administrators are seeking to realize the firm's assets after it
fell into administration.

The company appointed Richard Hawes and Robin Allen from
financial services firm, Deloitte, as administrators, according
to Business Sale.

The report relates that the administrators said that the company
does not have the funds available for them to be able to keep it
trading and allow them to look for a sale for it as a going
concern.  Business Sale relays that some 61 employees were made
redundant upon their appointment, with nine retained to aid with
the administration process.

"Poor trading results over the last two years coupled with the
increasingly difficult market conditions and low margins have
resulted in cash flow constraints. . . .  In the absence of a
significant cash injection into the company the directors were
unable to continue trading the business and requested the
appointment of administrators," the report quoted the
administrators as saying.

George White Motors operates from headquarters in Swindon, and
has five other retail locations across the UK, including in
Plymouth, Torbay, Donington, Slough and Bolton.

The administrators can be reached at:

         Richard Hawes
         Robin Allen
         Deloitte
         Liverpool
         Horton House
         Exchange Flags
         Liverpool L2 3PG
         United Kingdom
         Tel: +44 151 236 0941
         Fax: +44 151 236 2877
         E-mail: rhawes@deloitte.co.uk
                 rallen@deloitte.co.uk


PEACOCK GROUP: Follows Peacocks In Administration, Sells Bonmarch
-----------------------------------------------------------------
Caroline Cook at getwokingham reports that The Peacock Group,
which owns the clothing line Peacocks, followed its subsidiary
into administration putting the future of the fashion retailer in
limbo.

An administrator for The Peacocks Group is yet to be appointed
and existing management remains in place, according to
getwokingham.

"The board and advisers has been discussing for some time the
restructuring of the business with the group's lenders. . . .
Unfortunately these talks have now concluded and no agreement has
been reached. . . . But discussions with other potential
investors are on-going," Peacock Group said in a statement
obtained by the news agency.

The report notes that Peacock Group said it is selling its chain
of Bonmarche clothing shops but the future of Peacocks remains
unknown.

In a recent update, Sion Barry at WalesOnline reports that
Peacock Group's Bonmarch business has been acquired by private
equity firm Sun European.

The deal will see 160 stores close in Bonmarch's portfolio of 390
stores, with the loss of 1,200 jobs, according to WalesOnline.
Sun European Partners, WalesOnline relates, said the business
will now trade from approximately 230 stores, thereby providing
continued employment to approximately 2,400 employees in the UK.

Dow Jones Newswires, citing a person familiar with the matter,
notes that the Bonmarch stores, which are part of a so-called
"pre-pack" administration deal, were sold for approximately
GBP10 million.

Meanwhile, Kenilworth Weekly News relates that eleven Kenilworth
jobs have been put at risk following Peacocks administration.
LurganMail relays that around 30 jobs are also under threat at
the Rushmere Shopping Centre and Market Street stores.  This
comes after the Ulster Bank announced more than 350 job losses in
Northern Ireland, some of which could be in Lurgan, Kenilworth
Weekly News says.

             Members of Parliament Seek Help for Firm

South Wales Argus reports that Gwent Labor MPs have called on the
Welsh secretary to do more to help secure the future Peacocks.

Welsh Labour MPs wrote to Welsh secretary Cheryl Gillan,
expressing concerns the government wasn't doing enough to help,
according to South Wales Argus.

"As MPs who represent constituencies in which Peacocks is a
signficant local employer, we are concerned that the government
is not doing enough to assist the Group. . . .  We seek your
reassurances that this is not the case," the letter reads, South
Wales Argus notes.

The letter, South Wales Argus discloses, said the difficulties
faced by Peacocks are due in part to the government's decision to
raise VAT and called on the Welsh secretary to address the issue
as a matter of urgency.

South Wales Argus adds that Newport MPs Jessica Morden, Paul
Flynn, together with Torfaen member Paul Murphy, Blaenau Gwent's
Nick Smith and Islwyn's Chris Evans were among those who put
their name to the letter.

As reported in the Troubled Company Reporter-Europe on Jan. 20,
2012, Island FM said that Peacocks has fallen into administration
putting almost ten thousand jobs are at risk but as the Alliance-
based branch is a franchise, it is unclear what the future holds
for local staff.  KPMG is acting as administrator to the company,
which owns 611 stores and 49 concessions across the UK, according
to Island FM.  The report related that there is no immediate
threat as all stores will stay open as the business looks for a
buyer.  MarketWatch noted that The Sunday Telegraph published
that Peacocks debt talks stalled with banks.  MarketWatch relayed
that unnamed sources told the newspaper said that the key issue
is whether banks, led by Goldman Sachs Group Inc. GS, Barclays
PLC and Royal Bank of Scotland Group PLC RBS.LN, are willing to
take a reduction on the debt they are owed.  The retailer had
approximately GBP647 million of borrowings reported at the end of
April 2010, MarketWatch added.

                     About The Peacock Group

The Peacock Group has 611 stores and more than 9,000 staff across
the country, including branches in Bracknell, Wokingham and
Reading.  It owns Peacocks clothing chains

                          About Peacocks

Peacocks has over 70 franchise stores overseas, including in
Russia and Romania.  It also owns the Bonmarche discount chain.


PREMIER FOODS: Fitch Cuts Long-Term Issuer Default Rating to 'B+'
-----------------------------------------------------------------
Fitch Ratings has downgraded Premier Foods plc's Long-term Issuer
Default Rating (IDR) to 'B+' from 'BB-'.  The Outlook is
Negative.

The downgrade reflects a lowering of Fitch's EBITDA expectations
for 2011 and beyond, the ongoing tough UK retail environment
which is translating into continued price pressure on food
manufacturers, as well as the uncertainties arising from the
current debt renegotiation and its terms.

Based on Premier Foods' guidance included in its trading update
released on January 17, 2012, which estimated fiscal year 2011
financial results to be at the "lower end of current market
expectations", Fitch estimates Premier Foods' FYE11 EBITDA in the
range of GBP220 million-GBP230 million.  On a pro-forma basis,
adjusted for recent disposals, FYE11 EBITDA will likely decline
by 20% on the prior year. Free cash flow (FCF) may now be minimal
to slightly negative in FYE11.

Fitch expects that EBITDA and free cash flow (FCF) will only
gradually recover during 2012 and 2013 as increased cost savings
are reinvested in marketing spending.  Although Fitch
acknowledges the efforts of new management to support the group's
power brands, Fitch considers the execution risk in translating
this into increased sustainable revenues and profits remains
challenging in the current lackluster consumer environment.  As a
result, lease-adjusted net debt/EBITDAR is now expected to be
higher than 5x for at least two years, which is outside Fitch's
guidance for maintaining a 'BB-' rating.

Premier Foods has benefited from recent non-core business
disposals, in particular the disposal of loss making Brookes
Avana.  Fitch estimates this disposal will decrease lease-
adjusted net debt/EBITDAR by 0.4x. Premier Foods plans further
disposals of non-core brands, although disposal EV/EBITDA
multiples would need to be greater than 6x for these to have a
meaningful impact on credit metrics.  Given the recent disposal
of the high margin Irish Brands business for an EV/EBITDA of
4.4x, achieving a higher multiple may prove difficult.  Therefore
meaningful de-leveraging is likely to be more reliant on a
turnaround of recent weak financial performance.

In the near term, Premier Foods remains reliant on the
renegotiation of its current banking facilities.  The company
recently agreed a deferral of its December 2011 bank covenant
tests to March 2012 to facilitate these negotiations, which are
expected to conclude prior to the next covenant test date of 31
March 2012.

The Negative Outlook is related to the uncertainty surrounding
the ongoing banking facility negotiations and the execution risk
embedded in the turnaround plan over the next 12 to 18 months.
Although Fitch is not aware of the terms of the proposed
amendments to the current banking facilities, a resolution of the
Negative Outlook would likely require an extension of loan
maturities or a form of forward start facility agreement,
together with a covenant reset.  In addition, Premier Foods will
need to demonstrate increased pricing and negotiation power
towards the major supermarkets as a result of increased marketing
spending, as well as a stabilization of revenue and EBITDA.

Negative rating pressure could occur should the group's lease
adjusted net debt/EBITDAR increase above 6x on a sustained basis
with further evidence of erosion in FCF or if a long-term funding
solution is not agreed with the lending syndicate in a timely
manner, leading to un-waived covenant breaches.  Conversely a
successful renegotiation of its banking facilities and evidence
of more stable operating performance could lead to stabilization
of the Outlook.


TANGRAM LEISURE: In Administration, Sells Lifehouse Resort
---------------------------------------------------------
Tom Walker at spaopportunities.com reports that the Lifehouse spa
resort near Colchester, Essex, UK is up for sale after the
resort's owner Tangram Leisure went into administration.

David Thurgood, Jim Stewart-Koster and David Dunckley of Grant
Thornton UK have been appointed joint administrators of Tangram
Leisure, according to spaopportunities.com.

The report notes that the property is currently being managed by
the administrators and Lifehouse continues to trade as normal.

The administrators can be reached at:

        David Thurgood
        Jim Stewart-Koster
        David Dunckley
        GRANT THORNTON UK
        30 Finsbury Square
        London
        EC2P 2YU
        Tel: (020) 7184 4300
        Fax: (020) 7184 4301
        E-mail: david.r.thurgood@uk.gt.com
                jim.h.stewart-koster@uk.gt.com
                david.dunckley@uk.gt.com

The Lifehouse opened in December 2010 following an investment of
GBP30 million.  The resort is located within 135 acres of grounds
and has 100 guest bedrooms.


TM NEBURN: Progress Group Buys Firm Out of Administration
---------------------------------------------------------
Eilis Jordan at Business Sale reports that TM Newburn Group
Limited have been acquired by Progress Group out of
administration saving 20 jobs in the process.

The Telegraph and Argus reported that the acquisition will boost
Progress Group's turnover by GBP3 million and has saved most of
the workforce at TM Newburn Group Ltd, according to Business
Sale.  The report relates that the business will now be renamed
as Newburn Power Rental Ltd.

TM Newburn went into administration earlier this month and the
acquisition deal was for an undisclosed six-figure amount,
Business Sale notes.

TM Newburn Group Limited is a Bradford power equipment supplier.


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


* EUROPE: Germany Open to Boosting Rescue Funds to EUR750 Billion
-----------------------------------------------------------------
Gerrit Wiesmann, Alex Barker and Kerin Hope at The Financial
Times report that Germany is open to boosting the firepower of
the eurozone's rescue funds to EUR750 billion in exchange for
strict budget rules favored by Berlin in a new fiscal compact for
all members of the currency union.

Berlin appeared to soften its longstanding resistance to
increasing the funds only hours after the International Monetary
Fund warned that the eurozone needed more money to build "a
larger firewall" to prevent the crisis from spreading to its core
economies, the FT relates.

According to German and eurozone officials, Angela Merkel is
prepared to let the existing European Financial Stability
Facility, which has about EUR250 billion in unused funds, run in
parallel with its successor, the EUR500 billion European
Stability Mechanism, the launch of which has been brought forward
to July, the FT discloses.

In return the German chancellor wants eurozone heads of
government to sign up to rules to cut budget deficits and public
debt that are much tougher than those currently foreseen by
eurozone governments, the FT states.

According to the FT, IMF head Christine Lagarde said that without
a larger bail-out fund, fundamentally solvent countries like
Italy and Spain could be forced into a financing crisis,
Ms. Lagarde said in a speech in Berlin.  "This would have
disastrous implications for systemic stability," the FT quotes
Ms. Merkel as saying.

For Ms. Merkel, increasing the fund risks a showdown with a
restive parliament that is skeptical of further exposing German
taxpayers to the rescue effort, the FT notes.  But she is now
said to be willing to take that risk if she can put her stamp on
the budget rules in the fiscal compact, according to the FT.

William Boston and Andrea Thomas at The Wall Street Journal
reports that German Finance Minister Wolfgang Schauble, speaking
on German television Sunday evening, rejected the demands to
boost the ESM, saying Europe must first implement the decisions
made at the December summit of leaders before coming up with
fresh demands for more cash.

"We will stick to the agreement reached by the leaders in
December and then see again in March if that is sufficient," the
Journal quotes Mr. Schauble, speaking a day before a meeting of
European finance ministers and central bank chiefs to prepare the
Jan. 30 summit of EU leaders.

The lack of an alternative to a more muscular ESM has prompted
European leaders such as Italy's Mario Monti to urge Berlin to do
more to finance the euro-zone rescue, the Journal notes.


* EUROPE: S&P Affirms EU's Issuer Credit Rating; Outlook Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'AAA' long-term
issuer credit rating on the European Union (EU). The outlook is
negative. "At the same time we removed the long-term rating from
CreditWatch negative, where it was placed on Dec. 7, 2011. We
also affirmed the 'A-1+' short-term issuer credit rating. The
ratings on the EU are separate to those on the member states (the
EU-27) and are not a cap on any member state's ratings," S&P
said.

The EU is a supranational entity founded in 1958 by the Treaty
Establishing the European Community (the Treaty of Rome). The EU
and European Atomic Energy Community (EURATOM) borrow on the
capital markets under a joint EUR80 billion euro medium-term note
(EMTN) program for the purpose of providing loans or credit lines
to member states -- including eurozone members experiencing what
the Council considers to be severe economic or financial
disturbances caused by exceptional occurrences beyond a member's
control.

"During 2011, eurozone member states accounted for 62% of the
EU's total budgeted revenues; budgeted revenues from Germany and
France were 30% of total EU revenues, at 16% and 14%. On Jan. 13,
2012, we lowered the 'AAA' long-term sovereign credit rating on
France and Austria by one notch to 'AA+', and affirmed the long-
term rating on Germany at 'AAA'. As a consequence of the Jan. 13
downgrades, the pool of 'AAA' member states contributing to the
EU's revenues has declined to 33% of 2011 budgeted revenues, from
49%. Nevertheless, in our opinion, the supranational entity known
as the EU benefits from multiple layers of debt-service
protection sufficient to offset the current deterioration we see
in member states' creditworthiness. We are therefore affirming
the long- and short-term issuer credit ratings on the EU at
'AAA/A-1+'," S&P said.

The EU has lent EUR43.4 billion (as of Jan. 16, 2012), mostly to
eurozone member states under the European Financial Stabilization
Mechanism (EFSM). Its largest exposures are currently to Ireland
(EUR15.4 billion, BBB+/Negative/A-2) and Portugal (EUR15.6
billion, BB/Negative/B).

The EU also borrows to fund lending to non-eurozone member states
under its Balance of Payments (BoP) program (EUR11.4 billion:
Romania (BB+/Negative/B) EUR5 billion; Hungary (BB+/Negative/B)
EUR3.5 billion; and Latvia (BB+/Positive/B) EUR2.9 billion. It
also borrows to fund lending to the macro-financial assistance
(MFA) program (EUR0.6 billion), and for EURATOM-related lending
(EUR0.4 billion). In addition, the EU is an important guarantor
for the European Investment Bank (EUR22.4 billion,
AAA/Negative/A-1+). "We understand the EU has no loan exposure to
Greece (CC/Negative/C). These advances are funded by matching EU
borrowings under its EUR80 billion EMTN program, which has scope
for further increases without Council decision, if necessary,"
S&P said.

EU revenues consist primarily of member states' gross national
income (GNI) contributions and also VAT-based revenues from
member states. Timing differences between revenues received and
disbursed results in cash balances (held on EU accounts at
national treasuries and national central banks), which averaged
EUR8.2 billion in 2011, and which can be used, if necessary, for
EU debt service.

"In addition, in order to compensate for revenue shortfalls, due
to unexpected declines in GNI or other reasons, or to face debt
service if a borrowing government defaults to the EU, the EU can
call on member governments up to 1.23% of GNI (known as the 'own
resources ceiling'). The difference between 1.23% of GNI and the
annual ceiling in payments, which averages 1.07% of GNI between
2007 and 2013, constitutes the EU's 'headroom' or callable funds,
which would not require the appropriation of funds from member
states. The headroom was approximately EUR30 billion at year-end
2011. It compares with an estimated EUR1.4 billion of capital and
interest payments coming due in 2012," S&P said.

"We expect this amount to rise to more than EUR9 billion by
2015," S&P said.

"To the extent that headroom exists, our rating on the EU factors
in not only our view of its high franchise value as the central
fiscal body for the EU member states, and its balance sheet
characteristics, but also the potential source of additional
resources from members. The EU currently has four 'AAA' rated
members with stable outlooks (Denmark, Germany, Sweden, and the
U.K.) and three 'AAA' members with negative outlooks (Finland,
Luxembourg, and the Netherlands). Together, these seven member
states represent 33% of EU revenues for 2011," S&P said.

"One of the EU's balance sheet characteristics is the quality of
its loan portfolio. We expect that member states that borrow from
the EU would service their debt to the EU before servicing
commercial or bilateral debt. We note, however, that as the
proportion of official debt increases in relation to a borrowing
government's total debt stock, the senior position of privileged
creditors is diluted," S&P said.

"The negative outlook reflects our view of what we see as the
ongoing risks, at the eurozone level, to the creditworthiness of
EU member states and therefore the supranational entity of the EU
itself. The outlook is in line with the negative outlooks on 16
of the 27 member states. We could lower the ratings on the EU if
the number of 'AAA' rated member states decreases, or if the EU's
headroom decreases compared with its annual debt service, or if
member states default on payment obligations to the EU," S&P
said.


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Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true value
of a firm's assets.  A company may establish reserves on its
balance sheet for liabilities that may never materialize.  The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Thursday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.


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

Copyright 2012.  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 Peter Chapman at 240/629-3300.


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