TCREUR_Public/120404.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, April 4, 2012, Vol. 13, No. 68

                            Headlines



C Z E C H   R E P U B L I C

STAROROLSKY PORCELAN: Expects Sales to Rise to CZK8MM This Year


F I N L A N D

GEOSENTRIC OYJ: Shareholder Meeting to Decide on Liquidation


G E R M A N Y

Q-CELLS SE: Saxony-Anhalt May Help in Restructuring Effort


H U N G A R Y

* HUNGARY: Company Mandatory Liquidations Up 31% in March


I R E L A N D

EIRCOM GROUP: Bankruptcy Credit Event Occurred, ISDA Says
PEATS WORLD OF ELECTRONICS: To Enter Into Liquidation


I T A L Y

CASSA DI RISPARMIO: S&P Puts 'BB-' Rating on Watch Negative


K A Z A K H S T A N

HALYK SAVINGS: Moody's Issues Summary Credit Opinion


M A L T A

LUFTHANSA MALTA: Moody's Rates EUR234MM Exchangeable Bonds (P)Ba1


N E T H E R L A N D S

ENDEMOL NV: Mediaset Agrees to Sell 4.2% of Debt to Creditors
MESDAG BV: S&P Lowers Ratings on Two Note Classes to 'B-'
PROSPERO II: S&P Raises Rating on Class D Notes to 'BB'


R U S S I A

FAR EASTERN: Moody's Affirms Ba3 Deposit Ratings; Outlook Stable
SB BANK: Moody's Issues Summary Credit Opinion
SUBSIDIARY BANK: Moody's Issues Summary Credit Opinion


S E R B I A   &   M O N T E N E G R O

AGROBANKA AD: Incurs RSD29.7 Billion Loss in 2011


S P A I N

CAIXABANK: S&P Puts 'BB+' Ratings on Watch Negative
ITRAXX: S&P Rates EUR25M Series 9 Credit Default Swap 'BB+srp'


S W E D E N

NOBINA AB: Moody's Downgrades Corporate Family Rating to 'Caa1'
SAAB AUTOMOBILE: Receivers Estimate Debt at SEK12-SEK13 Billion


U K R A I N E

UKREXIMBANK: Moody's Issues Summary Credit Opinion


U N I T E D   K I N G D O M

EUROSAIL-UK: S&P Cuts Ratings on Four Note Classes to 'CCC'
EXPRO HOLDINGS: S&P Puts 'CCC+' Corp. Credit Rating on Watch Pos
HEALTHCARE LOCUMS: Expresses Going Concern Doubt
RMAC 2006-NS2: S&P Lowers Rating on Class B2a Notes to 'B-'
VICTORIA FUNDING: S&P Lowers Rating on Class E Notes to 'B-'


                            *********


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


STAROROLSKY PORCELAN: Expects Sales to Rise to CZK8MM This Year
---------------------------------------------------------------
CTK, citing the insolvency register, reports that Starorolsky
porcelan Moritz Zdekauer Karlovy Vary, which launched
reorganization in December after being in insolvency regime,
estimates its sales will rise by almost CZK8 million to around
CZK83.3 million this year.

The company, whose management filed for insolvency in January
2011, was spared from bankruptcy and liquidation after creditors
approved a reorganization plan, CTK recounts.

The firm said that sales should improve mainly on markets abroad,
CTK notes.  Among the most important trading territories will be
above all, Russia and countries of the former Soviet Union, CTK
discloses.

Starorolsky porcelan Moritz Zdekauer Karlovy Vary is a china
producer.



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


GEOSENTRIC OYJ: Shareholder Meeting to Decide on Liquidation
------------------------------------------------------------
Reuters reports that GeoSentric Oyj said on Tuesday it would seek
immediate disposal of all its assets after it failed to raise
sufficient financing to continue operations.

According to Reuters, the firm, which has struggled to shift from
its old Benefon cell phones business to location-based social
networking, said it would hold a shareholder meeting to decide on
the company's liquidation, while exploring all means of gathering
cash.

GeoSentric is a Finnish location-based services firm.  It
employed around 60 people in 2011.


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


Q-CELLS SE: Saxony-Anhalt May Help in Restructuring Effort
---------------------------------------------------------
Karin Matussek at Bloomberg News, citing Mitteldeutsche Zeitung,
reports that the German regional state of Saxony-Anhalt may help
Q-Cells SE in a restructuring effort.

According to Blooomberg, the newspaper cited Jens Bullerjahn, the
state's finance minister, as saying in an interview that the
state is open to talks about support if the company can reach a
turnaround.

Mitteldeutsche Zeitung said Prime Minister Reiner Haseloff had
previously ruled out any assistance, Bloomberg notes.

As reported by the Troubled Company Reporter-Europe on April 3,
2012, Bloomberg News related that Q-Cells SE said it will file
for insolvency this week.  The company's shares have lost more
than 70% of their value this year as the company started a debt
restructuring process while Germany reduces solar subsidies and
the industry as a whole fights over-capacity worldwide, Bloomberg
disclosed.  Q-Cells, based in Bitterfeld-Wolfen, said in a March
30 statement that a ruling last week by the Frankfurt Higher
Regional Court, which thwarted a restructuring by Pfleiderer AG,
set a precedent that casts doubt on its own efforts to
renegotiate bondholder agreements, Bloomberg said.  Q-Cells,
which said in the March 30 statement that it's exploring
alternatives to the plan after reaching agreements with its main
bondholders and with authorities in Malaysia and Germany, also
said its board sees "no going concern" for the company, according
to Bloomberg.

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


=============
H U N G A R Y
=============


* HUNGARY: Company Mandatory Liquidations Up 31% in March
---------------------------------------------------------
MTI-Econews reports that company information provider Opten said
on Monday the number of mandatory liquidation procedures
initiated against Hungarian companies came to 1,964 in March, up
31% from a year earlier.

According to MTI-Econews, Opten said that the number of voluntary
liquidations jumped 53% to 3,928 in March from a year earlier.

Opten said in the statement that the number or mandatory
liquidations was 5,828 in the first quarter of 2012, up 33% from
a year earlier, and the number of voluntary liquidations was
9,048, up 54% yr/yr, MTI-Econews notes.


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


EIRCOM GROUP: Bankruptcy Credit Event Occurred, ISDA Says
---------------------------------------------------------
Finbarr Flynn at Bloomberg News reports that International Swaps
and Derivatives Association, Inc. said on Monday its EMEA Credit
Derivatives Determinations Committee resolved that a bankruptcy
credit event occurred in relation to Eircom Ltd.

ISDA said March 20 said that a failure-to-pay credit event had
occurred at Eircom's parent ERC Ireland Finance Ltd., Bloomberg
recounts.

As reported by the Troubled Company Reporter-Europe on March 30,
2012, The Irish Times related that the High Court has granted
Eircom Group an interim examinership.  Mr. Justice Peter Kelly
said he was satisfied the company is insolvent and that
examinership would provide for a better outcome than receivership
or a winding up of the group, the Irish Times disclosed.
Eircom's requested examinership is to protect the company from
its creditors for up to 100 days and to allow it time to
restructure its debt, the Irish Times noted.  Michael McAteer of
Grant Thornton has been appointed interim examiner and the
examinership petition will be heard on April 18, the Irish Times
said.

Headquartered in Dublin, Ireland, Eircom Group --
http://www.eircom.ie/-- is an Irish telecommunications company,
and former state-owned incumbent.  It is currently the largest
telecommunications operator in the Republic of Ireland and
operates primarily on the island of Ireland, with a point of
presence in Great Britain.


PEATS WORLD OF ELECTRONICS: To Enter Into Liquidation
-----------------------------------------------------
RTE News reports that Peats World of Electronics has ceased
trading and will be seeking the appointment of a liquidator.

The closure of the 11 stores in Dublin will result in the loss of
75 jobs, RTE News discloses.  At its height in 2007, the company
had a turnover of EUR24 million, RTE News notes.

The company said a combination of recession impacts,
unsustainably high rental costs and a changing marketplace in
which online shopping was eating into high street retailing,
meant that the business can not continue to trade, RTE News
relates.

Peats World of Electronics is an electronics retailer.


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


CASSA DI RISPARMIO: S&P Puts 'BB-' Rating on Watch Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' long-term
rating on Italy-based Cassa di Risparmio della Provincia di
Teramo SpA (Tercas) on CreditWatch with negative implications.
"At the same time, we affirmed the 'B' short-term credit rating,"
S&P said.

"The CreditWatch placement reflects our view that Tercas'
performance remains vulnerable to further deterioration,
particularly considering high and rising credit losses, which in
2011 increased more than what we had incorporated into our
ratings," S&P said.

"Meanwhile, following the appointment of a new general manager in
February 2012, Tercas is going through a reorganization process
and developing a new business plan to enhance profitability,
restore an adequate capital position, and improve the bank's
credit risk management. In addition, the bank has announced a
capital increase of up to EUR60 million," S&P said.

"Tercas posted about a EUR9 million loss in 2011, mainly due to
high credit losses of about EUR78 million and EUR4.7 million in
negative mark-to-market valuations on financial assets. We
noticed that asset quality deteriorated materially, more than we
previously anticipated, leading to higher credit losses than we
had expected. Combined with persistently negative economic
conditions, the bank's gross nonperforming assets (NPAs) reached
a high of about 16% at year-end 2011 versus 11% in 2010. In our
view, Tercas' large single-name exposures, mainly to the real
estate sector outside of its home territory, weigh on its asset
quality performance. NPA coverage by provisions, at about 25% at
year-end 2011, is weaker than peers' and, in our view, still
negatively exposes the bank to possible additional credit losses
in the next few years," S&P said.

"The capital increase is part of management's actions to
strengthen the bank's capital position, with the aim to reach a
regulatory Tier 1 ratio above 8% by 2014. The bank's capital
position has materially declined in the last two years, also
because of the Banca Caripe acquisition, with a core Tier 1 ratio
of 5.8% at year-end 2011 compared to 10.7% in 2009. We expect
further pressure on the bank's earnings this year from possible
asset quality deterioration and still high credit losses arising
from the difficult economic conditions," S&P said.

"Standard & Poor's aims to resolve the CreditWatch placement
within the CreditWatch horizon, after analyzing the combined
impact of the new business plan, the announced capital increase,
and the likely future direction of the bank's asset quality and
profitability on our assessment of its capital and earnings
position. Upon resolution of the CreditWatch placement,
everything else being equal, we could affirm the long-term
counterparty credit rating or lower it by one notch," S&P said.

"We could downgrade the bank by one notch if we revised our
assessment of the bank's capital and earnings position to 'weak'
from 'moderate' according to our criteria. This could happen if
we conclude that the announced capital increase was unlikely to
go through, or if after going through we conclude that the
business plan or asset quality measures won't be enough to boost
performance and keep our forecast risk-adjusted capital (RAC)
ratio consistently above 5% over the next 12-18 months," S&P
said.

"Conversely, we could affirm the long-term rating if, everything
else being equal, we anticipate that the capital increase and the
other measures the bank takes under the business plan would
support a stronger capital and earnings assessment, and we saw
stabilization in asset quality trends. This would be the case
specifically if these measures lead us to expect that our RAC
ratio would remain consistently above 5% over the next 12-18
months," S&P said.

RATINGS SCORE SNAPSHOT
Issuer Credit Rating        BB-

SACP                        bb-
Anchor                     bbb
Business Position          Moderate (-1)
Capital and Earnings       Moderate (-1)
Risk Position              Weak (-2)
Funding and Liquidity      Average and Adequate (0)

Support                     0
GRE Support                0
Group Support              0
Sovereign Support          0

Additional Factors          0


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


HALYK SAVINGS: Moody's Issues Summary Credit Opinion
----------------------------------------------------
Moody's Investors Service issued a summary credit opinion on
Halyk Savings Bank of Kazakhstan and includes certain regulatory
disclosures regarding its ratings.  The release does not
constitute any change in Moody's ratings or rating rationale for
Halyk Savings Bank of Kazakhstan.

Moody's current ratings on Halyk Savings Bank of Kazakhstan and
its affiliates are:

Senior Unsecured (foreign currency) ratings of Ba3

Long Term Bank Deposits (domestic and foreign currency) ratings
of Ba2

Bank Financial Strength ratings of D-

Short Term Bank Deposits (domestic and foreign currency) ratings
of NP

Underlying Long Term Bank Deposits (domestic currency) ratings
of Ba2

Underlying Short Term Bank Deposits (domestic currency) ratings
of NP

HSBK (Europe) B.V.

BACKED Senior Unsecured (foreign currency) ratings of Ba3

Rating Rationale

Moody's assigns a bank financial strength rating (BFSR) of D- to
Halyk Savings Bank of Kazakhstan (Halyk Bank), which translates
to a Baseline Credit Assessment of Ba3. The rating is underpinned
by the bank's leading market position in Kazakhstan, with shares
in aggregate banking assets and retail deposits of 16.8% and
21.6%, respectively, at year-end 2010. However, the rating also
takes into account the risks associated with the bank's weak
asset quality, stemming from difficult economic conditions in
Kazakhstan.

Moody's assigns a global local currency (GLC) deposit rating of
Ba2 to Halyk Bank. The rating is based on Moody's assessment of a
moderate probability that systemic support would be extended to
the bank's depositors in case of need. Consequently, there is a
one-notch uplift for the GLC deposit rating from Halyk Bank's Ba3
Baseline Credit Assessment.

Rating Outlook

All of the bank's ratings carry a stable outlook.

What Could Change the Rating - Up

Halyk Bank's ratings have limited upside potential in the near
term. However, significant improvement in the bank's asset
quality, coupled with good liquidity and capitalisation will have
positive rating implications in the medium term.

What Could Change the Rating - Down

Further significant deterioration of the bank's asset quality and
material weakening of its capital adequacy might result in a
downgrade of Halyk Bank's BFSR.

A downgrade of Halyk Bank's BFSR is likely to result in a
downgrade of its deposit and debt ratings. Reduced systemic
support probability stemming from a downgrade of Kazakhstan's
sovereign ratings or an evidence of lowered willingness of the
government to support the bank may also result in a downgrade of
the bank's deposit ratings.

The methodologies used in these ratings were "Bank Financial
Strength Ratings: Global Methodology" published in February 2007,
and "Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology" published in March 2012 .


=========
M A L T A
=========


LUFTHANSA MALTA: Moody's Rates EUR234MM Exchangeable Bonds (P)Ba1
-----------------------------------------------------------------
Moody's Investors Service has assigned a (P)Ba1 rating to the
proposed EUR234.4 million Exchangeable Notes to be issued by a
Special Purpose Vehicle in Malta ('Lufthansa Malta Blues LP', or
'the Issuer') with a maturity in 2017. The Notes will be
exchangeable into the shares of JetBlue (rated B3, stable
outlook), in which Deutsche Lufthansa AG ('Lufthansa') retains a
15.9% stake. The Issuer is expected to purchase the shares of
JetBlue common stock from Deutsche Lufthansa in an amount equal
to 73% of the notes proceeds to be funded with a pro rata amount
of the notes proceeds; it will then lend the remaining 27% of the
notes proceeds to Deutsche Lufthansa pursuant to an intercompany
loan. The Issuer will use the interest payments received from
Deutsche Lufthansa under the intercompany loan to make interest
payments on the Notes.

Moody's issues provisional instrument ratings in advance of the
final sale of securities and these ratings reflect Moody's
preliminary credit opinion regarding the transaction only. Upon a
conclusive review of the final documentation, Moody's will
endeavour to assign a definitive rating to the notes. A
definitive rating may differ from a provisional rating.

Ratings Rationale

Lufthansa's current ratings reflect in part its diversified route
network as well as the diversity of its business segments, and
its solid liquidity position. However, the ratings also reflect
the recent weakening in credit metrics in FY2011 on account of
higher fuel prices as well as the increase in the pension
deficit, and Moody's cautious outlook for the industry at this
time. Moody's expects the recent volatility in fuel prices in
recent months will hamper industry profitability if prices remain
near current levels.

The rating of the notes, at the same level as the Corporate
Family Rating for Lufthansa, reflects the fact that the Notes are
to benefit from a full and unconditional guarantee from Deutsche
Lufthansa AG, while the guarantee itself will rank pari passu
with unsecured obligations of Lufthansa. Moody's understands that
the exchange is at the sole discretion of the bondholder, while
Lufthansa will retain a cash settlement option. If the exchange
option is not exercised, the bonds will mature in 2017 at par
plus accrued interest.

Moody's notes that Lufthansa's metrics deteriorated in 2011,
partly as a result of higher fuel costs in the second half of the
year, as well as the increase in the pension deficit. The
company's reported operating result fell from EUR1.02 billion in
2010 to EUR820 million in 2011. On an adjusted basis, gross
leverage remains somewhat below 5x, which Moody's considers to be
at the upper limit for the rating. Moody's further notes the
company's own forecast for 2012 that the operating result could
fall to the mid three digits, which would imply a moderate
further weakening in metrics, all other things being equal. This
reflects also the company's forecast for a potential fuel bill of
EUR7.5 billion in 2012 (versus EUR6.3 billion in 2011) based on a
fuel price of USD122 per barrel. However, Moody's also notes the
high level of uncertainty in forecasts at this time. In general,
Moody's believes that the company retains limited flexibility
within the current rating category, and Moody's will monitor
developments with regards to fuel costs and demand in the course
of 2012.

The company's liquidity remains solid, based on cash and
equivalents of EUR4.1 billion as of FYE2011, undrawn committed
short-term credit lines of EUR2.1 billion, and short-term debt of
EUR616 million as of FYE2011. Moody's notes that the company
retains a minimum liquidity target of EUR2.3 billion.

The stable outlook reflects the expectation that Lufthansa should
be able to maintain solid liquidity and appropriate credit
metrics for the rating category in the near term. However, the
weakening of credit metrics in 2011 has weakened its Ba1 rating
positioning and the company now has less flexibility to withstand
a deterioration in its profitability beyond the central scenario
indicated by management. While Moody's views it as unlikely in
the near-term, for positive pressure on the rating or outlook,
Moody's would expect to see gross leverage remain close to or
below 4x with RCF/Net debt remaining at least at 25%. Downward
pressure on the rating or outlook could occur if gross leverage
were to remain above 5x on a continued basis.

The principal methodology used in rating Lufthansa and Lufthansa
Malta Blues LP was the Global Passenger Airlines Industry
Methodology published in March 2009.

Deutsche Lufthansa AG, headquartered in Cologne, Germany, is the
leading European airline in terms of revenues. In FY2011 it
reported revenues and an operating result of EUR28.7 billion and
EUR820 million, respectively. Lufthansa Malta Blues LP, the
issuing entity for the proposed notes, is a limited partnership
registered in Malta.


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


ENDEMOL NV: Mediaset Agrees to Sell 4.2% of Debt to Creditors
-------------------------------------------------------------
Sharon Smyth at Bloomberg News reports that Expansion said
Mediaset Espana Comunicacion SA agreed to sell 4.2% of the debt
it held in Endemol to the Dutch company's creditors.

As reported by the Troubled Company Reporter-Europe on March 28,
2012, Bloomberg News related that Apollo Global Management and
Cyrte Fund II BV agreed to take on the majority of Endemol debt
held by other creditors and become the company's biggest
shareholders as they'll convert the loans into shares.  Endemol
said in January, a majority representing more than two-thirds of
its lenders had agreed "in principle" on restructuring about
EUR2 billion (US$2.7 billion) in debt, Bloomberg disclosed.

The Netherlands-based Endemol -- http://www.endemol.com/-- is
one of the world's leading producers of TV programs best known
for its output of hit reality-based programming and game shows
such as Deal or No Deal, Big Brother, and Extreme Makeover: Home
Edition.  The production company also creates scripted dramas and
soap operas, and develops digital content for online
distribution.  It has more than 2,000 programming formats in its
library and exports shows to more than 25 countries around the
world.  Formed in 1994, Endemol is owned by a consortium led by
private equity firm Goldman Sachs and Italian television company
Mediaset.


MESDAG BV: S&P Lowers Ratings on Two Note Classes to 'B-'
---------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
all classes of notes in MESDAG (Delta) B.V. "We subsequently
withdrew our rating on the class X notes," S&P said.

"MESDAG (Delta) is a European commercial mortgage-backed
securities (CMBS) transaction that closed in July 2007. It is
backed by a single loan, secured by a portfolio of 62 mixed-use
properties throughout the Netherlands. The loan includes
additional debt outside the securitization, in the form of a
subordinated B-note. The loan is scheduled to mature in December
2016 and the note maturity date is January 2020," S&P said.

"Our ratings address timely payment of interest and repayment of
principal not later than legal final maturity," S&P said.

"The rating actions follow our review of the underlying loan's
credit quality. We consider that the refinancing risks associated
with this loan have increased, and these factors may result in
principal losses," S&P said.

                       THE SENIOR LOAN

"The securitized loan of EUR609.9 million represents the senior
portion of a larger loan of about EUR649.0 million. The rights
between the issuer and the junior lender are regulated by an
intercreditor agreement. This agreement provides for pro rata
payments, unless a material event of default under the whole-loan
has occurred. A sequential pay mode waterfall applies upon a
material event of default," S&P said.

"As a result of property sales, the securitized loan balance has
reduced to EUR609.9 million as of January 2012, from EUR638.4
million at the transaction's closing date," S&P said.

"The whole-loan pays floating-rate interest. However, at closing,
the borrower entered into interest-rate swap arrangements to
cover 100% of the whole-loan amount against interest-rate
fluctuations until whole-loan maturity. If the whole-loan is not
repaid in full on the December 2013 loan interest payment date, a
step-up margin of 20 basis points will be due on the whole-loan
from January 2014. The relevant margin for each class of notes
will not change as a result of this step-up because the step-up
proceeds will be paid to the class X noteholders," S&P said.

"The whole-loan is interest-only until December 2013. At that
point, the cash left after servicing the debt (including the
step-up margin) will be used to amortize the whole-loan. We gave
some credit to amortization in our analysis," S&P said.

"The reported interest coverage ratios (ICRs) as of January 2012
remained consistent with the ratios at closing--with a current
whole-loan ICR of 1.35x and a securitized-loan ICR of 1.44x,
compared with a closing whole-loan ICR of 1.39x and a
securitized-loan ICR of 1.48x," S&P said.

"Property revaluations have offset the benefit of realized
property sales. Indeed, as of January 2012, the securitized loan-
to-value (LTV) and the whole-LTV ratios had increased to 79.7%
and 84.8%, from 74.6% and 79.3% at closing. The LTV ratios are
based on a December 2009 valuation for 50% of the portfolio, and
a December 2010 valuation for the remainder," S&P said.

The loan facility includes a cash-trap trigger at a 1.25x ICR or
85% LTV ratio to amortize the loan, and ICR default covenants at
1.10x.

                    THE LOAN COLLATERAL

"The whole-loan is now secured by 62 of what we consider to be
average-quality properties, down from 77 at closing. Since the
transaction closed, 16 properties were sold and one was
substituted. The 62 remaining properties consist mainly of office
and retail premises (79% altogether) and are spread across the
Netherlands. However, the top 10 properties by market value
account for about 59% of the pool, which suggests to us some
concentration risk," S&P said.

"As a result of property sales and a higher vacancy rate of 21.5%
on the remaining properties (as of January 2012) -- up from 11.3%
on the initial portfolio (at closing) -- passing rent has dropped
to EUR47.6 million from EUR49.6 million. On the other hand, the
weighted-average unexpired lease term of 6.8 years in January
2012 has remained very stable (compared with 6.9 years at
closing). The servicer reported a net operating income of EUR40.6
million in January 2012 and the departure of one tenant in the
previous quarter. With more than 350 leases continuing, income is
granular, although there is some rental concentration: The top 15
tenants by overall passing rent account for 51% of the pool.
Additionally, approximately 46% of the current rental income
could expire before the loan matures. In light of these factors,
we gave moderate credit to relettings in our analysis," S&P said.

                        RATING ACTIONS

"Taking into account our review of the loan, we consider that the
risk of principal losses has increased in light of the difficult
commercial real-estate market and lending conditions, which could
further depress property values. As a consequence, and even
though we do not see the risk as imminent, we consider that the
notes' creditworthiness has deteriorated," S&P said.

"We have therefore lowered our ratings on all the classes of
notes in MESDAG (Delta). We now rate the class E and F notes at
'B- (sf)', to reflect our view that they could suffer principal
losses," S&P said.

"We have also withdrawn our rating on the class X notes, to
reflect our criteria 'Global Methodology For Rating Interest-Only
Securities,' published on April 15, 2010. Under these criteria,
in the case of ratings on interest-only securities that were
outstanding on April 15, 2010, we maintain those ratings until
they are retired or drop below 'AA-', upon which we withdraw
them," S&P said.

       POTENTIAL EFFECTS OF PROPOSED CRITERIA CHANGES

"We have taken the rating actions based on our criteria for
rating European commercial mortgage-backed securities (CMBS).
However, these criteria are under review," S&P said.

"As highlighted in the Nov. 8 Advance Notice of Proposed Criteria
Change, we expect to publish a request for comment (RFC)
outlining our proposed criteria changes for rating European CMBS
transactions. Subsequently, we will consider market feedback
before publishing our updated criteria. Our review may result in
changes to the methodology and assumptions we use when rating
European CMBS, and consequently, it may affect both new and
outstanding ratings on European CMBS transactions," S&P said.

"Until such time that we adopt new criteria for rating European
CMBS, we will continue to rate and surveil these transactions
using our existing criteria," 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 Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at:

   http://standardandpoorsdisclosure-17g7.com/1111517.pdf

RATINGS LIST

Class                  Rating
               To                 From

MESDAG (Delta) B.V.
EUR638.4 Million Commercial Mortgage-Backed Floating-Rate Notes

Ratings Lowered

A sr           BBB+ (sf)          AA (sf)
B mezz         BB+ (sf)           A (sf)
C mezz         B+ (sf)            BBB (sf)
D jr           B (sf)             BB (sf)
E jr           B- (sf)            B+ (sf)
F sub          B- (sf)            B (sf)

Rating Lowered ad Withdrawn

X              BBB+ (sf)           AA (sf)
               NR                  BBB+


PROSPERO II: S&P Raises Rating on Class D Notes to 'BB'
-------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
all classes of notes in Prospero CLO II B.V.

"The rating actions follow our credit and cash flow analysis of
the transaction, using data from the latest available trustee
report (dated Feb. 8, 2012). We have considered recent
transaction developments, and our criteria for rating corporate
collateralized debt obligations (CDOs)," S&P said.

"The trustee report shows that all of the transaction's
overcollateralization tests are currently passing and that the
reported weighted-average spread earned on the collateral pool
has increased to 3.27% from 2.70% since we published our previous
update on this transaction. It also shows that the percentage of
portfolio assets that we consider in our analysis as defaulted
(i.e., debt obligations of obligors rated 'CC', 'SD' [selective
default], or 'D') has decreased since our previous review, to
0.0% from 3.5%. This reduction of assets treated as defaulted,
together with the amortization of the class A-1-A, A-1-B, and A-
1-C notes, has caused the credit enhancement available to all
classes of notes to increase," S&P said.

"From our analysis, we have observed a significant positive
ratings migration within the portfolio, which has resulted in
lower scenario default rates across all rating levels calculated
by our CDO Evaluator 6.0 rating model," 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 of notes. In our analysis, we used the portfolio
balance that we considered to be performing (i.e., of assets
rated 'CCC-' or above), the reported weighted-average spread of
3.27%, and the weighted-average recovery rates that we considered
to be appropriate. We incorporated various cash flow stress
scenarios using our standard default patterns, levels, and
timings for each rating category assumed for each class of notes,
in conjunction with different interest rate and exchange rate
stress scenarios," S&P said.

"Approximately 29.6% of the assets in the transaction's portfolio
are not U.S. dollar-denominated. The issuer has not entered into
any derivative agreement to mitigate the risk of foreign-
exchange-related losses. We have therefore applied appropriate
stresses in our cash flow modeling," S&P said.

"We have observed from our analysis that the credit support
available to all classes of notes is now commensurate with higher
ratings than previously assigned. Accordingly, we have raised our
ratings on the class A-1-A, A-1-B, A-1-C, A-1-VF, A-2, B, C, D,
and E notes," S&P said.

Prospero CLO II is a cash flow CDO transaction that securitizes
loans to primarily speculative-grade corporate firms. The
transaction closed in October 2006 and is managed by Alcentra NY,
LLC.

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

   http://standardandpoorsdisclosure-17g7.com/1111517.pdf


RATINGS LIST

Class                    Rating
                To                  From

Prospero CLO II B.V./Prospero CLO II Inc.
EUR69 Million, GBP10.5 Million, And $293.7 Million Secured
Floating-Rate Notes

Ratings Raised

A-1-A            AA+ (sf)           A+ (sf)
A-1-B            AA+ (sf)           A+ (sf)
A-1-C            AA+ (sf)           A+ (sf)
A-1-VF           AA+ (sf)           A+ (sf)
A-2              A+ (sf)            BBB+ (sf)
B                BBB+ (sf)          BBB- (sf)
C                BBB (sf)           BB (sf)
D                BB (sf)            CCC (sf)


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


FAR EASTERN: Moody's Affirms Ba3 Deposit Ratings; Outlook Stable
----------------------------------------------------------------
Moody's Investors Service has affirmed the following ratings of
Far Eastern Bank: Ba3 long-term local and foreign currency
deposit ratings, Not Prime short-term local and foreign currency
deposit ratings, and E+ standalone Bank Financial Strength Rating
(BFSR, mapping to b3 on the long-term scale). All of the bank's
ratings carry a stable outlook.

Moody's assessment is primarily based on Far Eastern Bank's
financial statements for 2011 (audited) -- prepared under IFRS,
and (unaudited) Russian GAAP as at January 1, 2012.

Ratings Rationale

According to Moody's, Far Eastern Bank's ratings are constrained
by (i) high single-name concentration in the loan book, (ii)
maturity mismatches, (iii) weak asset quality and (v) low
capitalization. However, the ratings are supported by Moody's
assessment of a high probability of capital and liquidity support
from its parent Russian Regional Development Bank (Ba2/Not-
Prime/E+, stable outlook, with the BFSR mapping to b2 on the
long-term scale) and by Rosneft (Baa1, stable outlook) which is,
in turn, the owner of Far Eastern Bank's parent. Other supporting
factors include Far Eastern Bank's recognized name and
established branch coverage in the Russian Far East.

Bank Financial Strength Rating

The key factors that position Far Eastern Bank's standalone
credit strength in the b3 category are as follows:

Firstly, Far Eastern Bank has high borrower concentrations. The
20 largest loans accounted for 42% of gross loans at YE2011 (in
accordance with IFRS). In relation to Tier 1 capital, Far Eastern
Bank's exposure to the largest 20 borrowers was around 470% at
YE2011 (the average for Russian banks is below 250%). Moody's
notes that this exposes the bank's creditworthiness to the
financial standing of a few large borrowers, with potential for
earnings and asset quality volatility.

Secondly, Far Eastern Bank's exposure to liquidity risk is high
due to the high proportion of short-term customer accounts in the
funding base. This leads to substantial negative liquidity gaps
in all 'time buckets', as assessed in Moody's liquidity stress
test. Total deposits with maturity 'on demand' and 'less than a
month' accounted for more than half of total customer accounts at
YE2011. In Moody's opinion, this renders the bank's liquidity
profile vulnerable to deposit outflows.

Thirdly, Far Eastern Bank's asset quality is relatively weak,
with problem loans (loans overdue more than 90 days and
restructured loans) accounting for 13% of gross loans at YE2011.
Moreover, due to high concentrations, the bank's loan quality is
sensitive to the financial standing of its largest borrowers. In
addition, almost a third of total loans have been extended to
industries regarded by Moody's as higher risk, such as financial
services and construction which accounted for 22% and 9% of gross
loans, respectively, as at YE2011 (under IFRS).

Finally, Far Eastern Bank's capital buffer is small, with the
regulatory capital adequacy ratio standing at 11.58% at 1 March
2012, which is just above the 10% minimum regulatory requirement.
Based on Far Eastern Bank's current level of loan loss provisions
and expected earnings, Moody's does not expect capitalization to
fall below the required minimum in the rating agency's central
scenario. However, in an adverse scenario Far Eastern Bank might
require capital support.

Moody's notes positively that Far Eastern Bank's ownership
structure was significantly streamlined following the 100%
acquisition of its voting shares by Russian Regional Development
Bank (initiated in 2011 and completed in March 2012). Previously,
Far Eastern Bank's ownership structure had been relatively
complex and non-transparent.

Overall, Moody's believes that the risks stemming from high
single-name concentrations in the loan book, maturity mismatches,
weak asset quality and low capitalization outweigh the recent
positive change in Far Eastern Bank's ownership structure.
Therefore, the bank's standalone credit strength remains
adequately positioned in the b3 category.

Global local and foreign currency deposit ratings

Far Eastern Bank's Ba3 deposit ratings continue to benefit from a
three-notch uplift from its b3 standalone credit strength due to
Moody's assumption of a high probability of parental support from
Russian Regional Development Bank which fully owns and
consolidates Far Eastern Bank. Far Eastern Bank plans to merge
with Russian Regional Development Bank by the end of 2013.

According to Moody's, a reduction in concentration levels,
improvements in the liquidity profile and asset quality as well
as a higher capital buffer could exert upward pressure on Far
Eastern Bank's standalone and supported ratings. Conversely,
negative pressure could be exerted on these ratings as a result
of any material adverse changes in the bank's risk profile,
particularly any impairment of its liquidity position, and any
failure to maintain control over asset quality. Furthermore, any
evidence of a lower probability of support from the parent bank
and/or Rosneft could result in a downgrade of the bank's long-
term deposit rating and/or could result in a lowering of the
standalone credit strength.

Principal Methodologies

The methodologies used in these ratings were Bank Financial
Strength Ratings: Global Methodology published in February 2007,
and Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: A Refined Methodology published in March 2012.

Headquartered in Vladivostok in the Russian Far East, Far Eastern
Bank had total assets of RUB31.5 billion (US$977.2 million) and
total equity of RUB3.2 billion (US$98.7 million), and reported a
net profit of RUB496.4 million (US$15.4 million) as at YE2011,
according to audited IFRS.


SB BANK: Moody's Issues Summary Credit Opinion
----------------------------------------------
Moody's Investors Service issued a summary credit opinion on SB
Bank and includes certain regulatory disclosures regarding its
ratings. This release does not constitute any change in Moody's
ratings or rating rationale for SB Bank.

Moody's current ratings on SB Bank are:

Senior Unsecured (domestic currency) ratings of B3

Long Term Bank Deposits (domestic and foreign currency) ratings
of B3

Bank Financial Strength ratings of E+

Short Term Bank Deposits (domestic and foreign currency) ratings
of NP

Rating Rationale

Moody's assigns a bank financial strength rating (BFSR) of E+ to
Sudostroitelny Bank (SB Bank), which translates to a Baseline
Credit Assessment of B3. The rating is constrained by the bank's
limited franchise, its significant reliance on wholesale funding
and high market risk exposures. The rating is underpinned by the
bank's relatively well-known brand name in the SME sector, as
well as its acceptable asset quality and reasonable
capitalization.

Moody's assigns a global local currency (GLC) deposit rating of
B3 to SB Bank. The rating does not factor in any probability of
systemic support in the event of a stress situation, based on the
bank's insignificant national market share and relative
importance to the country's banking system. Consequently, the
bank's GLC deposit rating is at the same level as its B3 Baseline
Credit Assessment.

Rating Outlook

All of the bank's ratings carry a stable outlook.

What Could Change the Rating - Up

A reduction in the bank's reliance on wholesale funding as well
as lower market risk appetite could have positive rating
implications on the bank's deposit and debt ratings.

What Could Change the Rating - Down

Any material increase in borrower concentration, deterioration in
the bank's asset quality, or a significant decline in capital
adequacy or liquidity could warrant a downgrade of the bank's
ratings.

The methodologies used in this rating were "Bank Financial
Strength Ratings: Global Methodology" published in February 2007,
and "Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology" published in March 2012.


SUBSIDIARY BANK: Moody's Issues Summary Credit Opinion
------------------------------------------------------
Moody's Investors Service issued a summary credit opinion on
Subsidiary Bank Sberbank of Russia and includes certain
regulatory disclosures regarding its ratings. The release does
not constitute any change in Moody's ratings or rating rationale
for Subsidiary Bank Sberbank of Russia.

Moody's current ratings on Subsidiary Bank Sberbank of Russia
are:

Senior Unsecured (domestic currency) ratings of Ba2

Long Term Bank Deposits (domestic currency) ratings of Ba2

Long Term Bank Deposits (foreign currency) ratings of B3

Bank Financial Strength ratings of E+

Short Term Bank Deposits (domestic and foreign currency) ratings
  of NP

NSR Senior Unsecured (domestic currency) ratings of Aa1.ua

NSR Long Term Bank Deposits (domestic currency) ratings of
Aa1.ua

Rating Rationale

Moody's assigns a bank financial strength rating (BFSR) of E+ to
Subsidiary Bank Sberbank of Russia (SBSR) which translates into a
Baseline Credit Assessment (BCA) of B2. The BFSR is constrained
primarily by SBSR's relatively small size, high borrower
concentration and rapid loan growth. However, the rating reflects
SBSR's adequate capitalization and satisfactory risk management.

Moody's assigns a global local currency (GLC) deposit rating of
Ba2 to SBSR, which factors in Moody's assessment of a high
probability of parental support from Sberbank (D+/Ba1/A3) the
largest bank by assets in the Russian Federation. Consequently,
SBSR's GLC deposit rating receives a three-notch uplift from the
B2 BCA. The bank's B3 foreign currency deposit rating is
constrained by the sovereign ceiling for the Ukraine.

Rating Outlook

The outlook on all of the bank's BFSR and local currency deposit
rating is stable. The outlook on the foreign currency deposit
rating is negative driven by the negative outlook on Ukraine's
foreign currency deposit ceiling.

What Could Change the Rating - Up

The bank's local currency deposit and debt ratings may be
upgraded in the medium term if the bank's loan book seasons
without significant losses and pressure on its profitability and
capitalization.

Its B3 foreign currency deposit rating is constrained by the
country ceiling for Ukraine; the currency deposit rating may be
upgraded if Moody's raises the country ceiling for the Ukraine.

What Could Change the Rating - Down

The bank's rating could be downgraded if SBSR's asset quality
suffered material deterioration with a notable negative effect on
the bank's profitability and capitalization. A reduction of the
parental support from Sberbank, although not currently
anticipated, would likely result in the ratings downgrade. The
foreign currency deposit rating is likely to mirror movements in
the respective country ceiling.

The methodologies used in this rating were "Bank Financial
Strength Ratings: Global Methodology" published in February 2007,
and "Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology" published in March 2012 .

Moody's National Scale Ratings (NSRs) are intended as relative
measures of creditworthiness among debt issues and issuers within
a country, enabling market participants to better differentiate
relative risks. NSRs differ from Moody's global scale ratings in
that they are not globally comparable with the full universe of
Moody's rated entities, but only with NSRs for other rated debt
issues and issuers within the same country. NSRs are designated
by a ".nn" country modifier signifying the relevant country, as
in ".mx" for Mexico.


=====================================
S E R B I A   &   M O N T E N E G R O
=====================================


AGROBANKA AD: Incurs RSD29.7 Billion Loss in 2011
-------------------------------------------------
Gordana Filipovic at Bloomberg News reports that Agrobanka AD,
which was placed into receivership three months ago, posted a
RSD29.7 billion (US$355 million) loss last year.  That compares
with a pretax profit of RSD1.18 billion for 2010, Bloomberg
notes.

According to Bloomberg, an Agrobanka financial statement released
by the central bank on Monday said that the financial statement
showed zero capital and accumulated losses of RSD17.6 billion at
the end of 2011.

The lender's assets shrank to RSD61.6 billion from RSD74.4
billion at the end of the previous year, Bloomberg discloses.

"Agrobanka seems to have written off a lot more claims than
realistically required," Bloomberg quotes Nenad Gujanicic, chief
broker at Belgrade-based Sinteza Invest Group AD brokerage, as
saying.  "The problem is that in its present shape, it will be
impossible to find a strategic partner for Agrobanka" while the
government has no money in its budget to boost the bank's
capital.

Serbia's central bank fired the management of Agrobanka on
Dec. 29 and placed it in receivership after inspectors discovered
its capital didn't match the risk it had assumed with its
business, Bloomberg recounts.

Agrobanka AD is a commercial bank.  The Bank offers retail and
corporate services in loans for current agricultural productions,
such as cattle and plannt production, farming machinery, food
processing, delivery vehicles, and other agricultural operations.


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


CAIXABANK: S&P Puts 'BB+' Ratings on Watch Negative
---------------------------------------------------
Standard & Poor's Ratings Services put CaixaBank's hybrids 'BB+'
ratings on watch negative and affirmed the bank's 'BBB+/A-2'
ratings on announced merger with Banca Civica.


ITRAXX: S&P Rates EUR25M Series 9 Credit Default Swap 'BB+srp'
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+srp (sf)' and
'BBB-srp (sf)' portfolio swap risk ratings to iTraxx's series 9
EUR25 million and series 15 EUR10 million unfunded credit default
swap tranches.

"A swap risk rating takes into consideration only the
creditworthiness of the reference portfolio. It does not address
either counterparty risk (protection buyer/seller) or the
specific amount of termination payments that would be payable
under the swap transaction," S&P said.

"Under the terms of the swap referencing iTraxx's 3%-6% series 9
tranche for a notional amount of EUR25 million (maturing in June
2013), Banco Santander Central Hispano acts as protection buyer.
In our opinion, the attachment point is sufficient to support our
'BB+srp (sf)' rating on the tranche," S&P said.

"Under the terms of the swap referencing iTraxx's 3%-6% series 15
tranche for a notional amount of EUR10 million (maturing in June
2014), and Banco Santander Central Hispano as protection seller.
In our opinion, the attachment point is sufficient to support our
'BBB-srp (sf)' rating on the tranche," S&P said.

"We based our 'srp' rating on our analysis using our latest
applicable CDO Evaluator model version 6.0," S&P said.

RATINGS LIST

                  Rating

SWAP RISK RATINGS ASSIGNED

Credit Default Swap
EUR25 Million Unfunded Credit Default Swap iTraxx
Series 9 Tranche 3%-6%

                  BB+srp (sf)

Credit Default Swap
EUR10 Million Unfunded Credit Default Swap iTraxx
Series 15 Tranche 3%-6%

                  BBB-srp (sf)


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


NOBINA AB: Moody's Downgrades Corporate Family Rating to 'Caa1'
---------------------------------------------------------------
Moody's Investors Service has downgraded the corporate family
rating (CFR) and the probability of default rating (PDR) of
Nobina AB to Caa1 from B3. The ratings remain under review for
possible downgrade. Nobina's EUR85 million (approximately
SEK752 million at March 30, 2012) senior secured notes due
August 1, 2012 are not rated by Moody's.

Downgrades:

  Issuer: Nobina AB

     Probability of Default Rating, Downgraded to Caa1 from B3

     Corporate Family Rating, Downgraded to Caa1 from B3

Ratings Rationale

The rating action reflects Moody's material concerns with regards
to Nobina's capacity to refinance the approaching maturity of its
EUR85 million senior secured notes due August 1, 2012 within the
next three months in a continued fragile economic environment and
in the absence of sufficient internal liquidity sources to redeem
the notes. Moody's understands that Nobina is currently
considering various alternatives to refinance the notes. However,
Moody's sees heightened risk that the company's current review of
appropriate refinancing options will result in a distressed
exchange or other restructuring measures, which could result in a
loss for existing bondholders.

Nobina's shareholder and bondholder base is largely aligned,
which might help to reduce the execution risk of a refinancing.

Moody's rating review will focus on (i) Nobina's ability to
address the maturity of its EUR85 million senior secured notes
within the next three months; (ii) the terms & conditions of such
refinancing and the possibility that the position of existing
noteholders might be impaired and (iii) the group's liquidity
management going forward.

In the absence of any committed long-term revolving credit
facilities, the company's liquidity is limited to available cash
on balance sheet of SEK159 million at November 30, 2011, and
operating cash flow generation. These cash sources are currently
insufficient to cover short-term debt maturities of SEK1,107
million, of which SEK768 million related to the EUR85 million
senior notes at November 30, 2011, and the remaining portion to
short-term financial leasing liabilities, and seasonal swings in
working capital and capex needs.

Moody's notes that the company has a 364 days agreement to sell
receivables in the amount of SEK300 million with a finance
company, under which SEK46 million were outstanding at
November 30, 2011, which Moody's does not consider for the
purpose of Moody's liquidity analysis because of their short term
nature.

Moody's methodology for evaluating a distressed exchange
considers inter alia whether (i) the issuer would be offering
creditors a new package of security or cash that amount to a
diminished financial obligation relative to the original
obligation prescribed by the notes' indentures and (ii) the
exchange is apparently being offered to allow the issuer to avoid
a bankruptcy or payment default.

Triggers for a Potential Donwgrade/Upgrade

Further negative rating pressure could arise in case of Nobina's
inability to address its refinancing needs within the next three
months or any transaction that could qualify as a distressed
exchange under Moody's definition, leading to potential losses
for existing noteholders.

The ratings could be upgraded in case of a successful refinancing
with no loss to existing noteholders, which should also result in
improvements in the company's weak liquidity profile.

The Caa1 rating assumes that Nobina can maintain stable operating
performance and generate at least break-even free cash flows.
Overall, this should result in stable credit metrics compared to
the last twelve months (LTM) period 30 November 2011 with
debt/EBITDA of 6.3x and interest cover (EBIT/interest expense) of
0.7x.

Other factors considered in Nobina's Caa1 rating are (i) the
company's position as the largest Nordic bus transportation group
with a significant proportion of business with local Scandinavian
communities with relatively high revenue visibility and
predictability due to limited transportation volume exposure;
(ii) the group's track record of improving operating performance
from the lows in 2007, which was supported by the defensive
character of the public bus transportation industry; (iii) but
also the group's limited scale with revenues and profit
generation being concentrated on the Swedish market.

Nobina AB is the largest Nordic bus transportation company,
operating in Sweden, Norway, Finland and Denmark. Its revenues
for fiscal year 2010/11 (ending February 28) totaled SEK6.5
billion and were mostly generated from public bus services in
Sweden. This reflects the more advanced stage of the deregulation
in this country, where almost all local and regional bus services
have been tendered since 1989, in contrast to the situation in
Norway and Finland, where less than 50% of the traffic has been
tendered so far. In Sweden, the public bus transportation needs
of Contractual Public Transportation Associations (CPTAs) are put
up for tender via a competitive bidding process and the tenor of
such contracts is typically five to eight years. The majority of
contracts are priced with cost indexation levels adjusted on a
monthly (Denmark), quarterly (Sweden, Finland) or annual basis
(Norway).

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


SAAB AUTOMOBILE: Receivers Estimate Debt at SEK12-SEK13 Billion
---------------------------------------------------------------
Christina Zander, writing for Dow Jones Newswires, reports that
the official receivers of bankrupt Saab Automobile AB and two of
its subsidiaries said Tuesday they calculate that the company's
total debts are between SEK12 billion and SEK13 billion (US$1.8
billion and US$2 billion).

The full probate will be published Tuesday, April 10, which is
also the deadline for interested parties to place their final
bids for Saab Automobile's assets, Dow Jones discloses.

The receivers, Hans L. Bergqvist, a partner at law firm Delphi,
and Anne-Marie Pouteaux, a partner at Wistrand, said a handful of
parties are interested in buying Saab Automobile's facilities in
Trollhattan, Sweden, Dow Jones relates.  All of them are
interested in producing cars at the plant, Dow Jones says.

Chinese car maker Zhejiang Youngman Lotus Automobile Co. has
confirmed that it is one of the parties bidding for Saab
Automobile's assets, Dow Jones notes.

                           About Saab

Saab, or Svenska Aeroplan Aktiebolaget (Swedish Aircraft
Company), was founded in 1937 as an aircraft manufacturer and
revealed its first prototype passenger car 10 years later after
the formation of the Saab Car Division.  In 1990, Saab
Automobile AB was created as a separate company, jointly owned by
the Saab Scania Group and General Motors, and became a wholly
owned GM subsidiary in 2000.  In February 2010, Spyker Cars N.V.
was renamed Swedish Automobile N.V. (Swan) on June 15, 2011.

Saab Automobile AB currently employs approximately 3,700 staff in
Sweden, where it operates production and technical development
facilities at its headquarters in Trollhattan, 70 km north of
Gothenburg.  Saab Cars North America is located in Royal Oak,
Michigan employing approximately 50 people responsible for sales,
marketing and administration duties for the North American
market.

On Dec. 19, 2011, Swedish Automobile N.V. disclosed that Saab
Automobile AB (Saab Automobile), Saab Automobile Tools AB and
Saab Powertrain AB filed for bankruptcy with the District Court
in Vanersborg, Sweden.  After having received the recent position
of GM on the contemplated transaction with Saab Automobile,
Youngman informed Saab Automobile that the funding to continue
and complete the reorganization of Saab Automobile could not be
concluded.  The Board of Saab Automobile subsequently decided
that the company without further funding will be insolvent and
that filing bankruptcy is in the best interests of its creditors.
Swan does not expect to realize any value from its shares in Saab
Automobile and will write off its interest in Saab Automobile
completely.


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


UKREXIMBANK: Moody's Issues Summary Credit Opinion
--------------------------------------------------
Moody's Investors Service issued a summary credit opinion on
Ukreximbank and includes certain regulatory disclosures regarding
its ratings.  The release does not constitute any change in
Moody's ratings or rating rationale for Ukreximbank.

Moody's current ratings on Ukreximbank are:

Senior Unsecured (foreign currency) ratings of B1

Long Term Bank Deposits (domestic currency) ratings of Ba3

Long Term Bank Deposits (foreign currency) ratings of B3

Bank Financial Strength ratings of D-

Subordinate (foreign currency) ratings of B1

Short Term Bank Deposits (domestic and foreign currency) ratings
of NP

BACKED Senior Unsecured (domestic currency) ratings of Ba3

BACKED Senior Unsecured (foreign currency) ratings of B1

Rating Rationale

Moody's assigns a bank financial strength rating (BFSR) of D- to
Ukreximbank, which translates into a Ba3 Baseline Credit
Assessment. The rating is underpinned by the bank's developed
corporate franchise and strong capitalization. However the rating
is constrained by potential corporate governance concerns,
significant borrower and industry concentrations in the loan
book, weak asset quality and material reliance on market funding.

The bank's Global Local Currency (GLC) deposit rating
incorporates its Ba3 BCA and Moody's assessment of the
probability of systemic support from the Ukrainian government,
which is although very high - due to Ukreximbank's government
ownership and substantial market share in Ukraine's lending
market - however does not result in any notching uplift from the
bank's BCA as the support provider rating of Ukraine of B2 is
lower than the bank's BCA.

Rating Outlook

The outlook on Ukreximbank's B3 foreign currency deposit and B1
foreign currency debt ratings is negative, driven by the negative
outlook on the foreign currency deposit and debt ceilings for
Ukraine. The outlook on the BFSR and the local currency deposit
and debt ratings is stable.

What Could Change the Rating - Up

Ukreximbank's D- BFSR has limited upside potential in the near
term, however a stabilization in the bank's assets quality
coupled with improved earnings generation could have positive
ratings implication in the medium-term. The bank's Ba3 local
currency deposit rating is likely to move in tandem with its BCA
of Ba3. The B3 foreign currency deposit and B1 foreign currency
debt ratings are constrained by the country ceilings for Ukraine
and can be upgraded in the event of upgrading those ceilings.

What Could Change the Rating - Down

The bank's BFSR and local currency deposit rating could come
under negative pressure if the bank's asset quality deterioration
accelerates considerably. Any notable tension in the bank's
liquidity position suggesting higher than anticipated refinancing
risks may result in the bank's ratings downgrade. A downgrade of
Ukraine's country ceilings for foreign currency debt and deposit
ratings will result in the downgrade of Ukreximbank's FC deposit
and debt ratings.

The methodologies used in this rating were "Bank Financial
Strength Ratings: Global Methodology" published in February 2007,
and "Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology" published in March 2012.


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


EUROSAIL-UK: S&P Cuts Ratings on Four Note Classes to 'CCC'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
Eurosail-UK 2007-3BL PLC's class A2, C1, D1a, and E1c notes. "At
the same time, we have affirmed our ratings on the class A3 and
B1 notes," S&P said.

"The rating actions follow our credit and cash flow analysis of
the most recent transaction information that we have received,
applying our updated U.K. residential mortgage-backed securities
(RMBS) criteria," S&P said.

"On December 19, 2008, we took various rating actions on all
classes of notes in this transaction, after it ceased to benefit
from a currency swap," S&P said.

Similarly, the downgrades are primarily driven by the reduction
in credit enhancement as a result of unhedged currency risk.

"In the absence of a currency swap, available principal to make
payments on the euro-denominated and US dollar-denominated notes
is converted at the spot rate. With the appreciation of the euro
and the US dollar against British pound sterling, principal
payments to noteholders have been lower than if the original
currency swap had been in place. Consequently, we calculate that
potential losses resulting from principal payments to date are at
GBP32 million; the euro/sterling spot rate for the December 2011
payment date (EUR1.17/GBP1) remains below the swap rate at
closing (EUR1.48/GBP1) and the U.S. dollar/sterling spot rate for
the December 2011 payment date (US$1.57/GBP1) remains below the
swap rate at closing (US$2.02/GBP1). As long as this remains the
case, we consider that undercollateralization, currently at 27%,
will increase," S&P said.

The transaction continues to benefit from a liquidity facility;
the reserve fund is currently at 80% of its target level,
following a reserve fund draw in September 2011.

"Severe arrears (defined in this transaction as more than 90
days), while relatively high at 19.1%, have remained fairly flat
since mid-2009. Cumulative losses have tailed off in recent
quarters as the stock of repossessed properties has reduced from
the mid-2009 peak of 2.96%, which is consistent with other
nonconforming U.K. RMBS transactions that we rate," S&P said.

"In addition, prepayment levels remain low and the transaction is
unlikely to pay down significantly in the near term, in our
opinion," S&P said.

"Credit enhancement levels for the class A2 notes have decreased
slightly since our previous review of this transaction in August
2010 and the rating is no longer commensurate with the level
achieved in our cash flow analysis. We have therefore lowered our
rating on the class A2 notes to 'BB- (sf)'," S&P said.

"We have also lowered our ratings on the class C1, D1, and E1c
notes because, in our view, there is a one-in-two chance of
eventual default, given that all classes of notes would be
undercollateralized if losses due to principal payments already
made are eventually realized," S&P said.

"We have affirmed our ratings on the class A3 and B1 notes, based
on the results of our credit and cash flow analysis and the
application of our U.K. RMBS criteria," S&P said.

"We expect severe arrears to remain at their current levels, as
there are a number of downside risks for U.K. nonconforming
borrowers. These include declining inflation, weak economic
growth, high unemployment, and fiscal tightening. On the positive
side, we expect interest rates to remain low for the foreseeable
future," S&P said.

"We will continue to monitor this transaction, paying particular
attention to the euro/sterling and U.S. dollar/sterling exchange
rates," S&P said.

Eurosail-UK 2007-3BL is a U.K. nonconforming RMBS transaction
backed by first- and second-ranking mortgage loans (in England,
Wales, and Northern Ireland) and standard securities (in
Scotland). It closed in July 2007 and securitizes mortgages
originated by Southern Pacific Mortgage Ltd., Preferred Mortgages
Ltd., Alliance & Leicester PLC, London Mortgage Co., and Amber
Homeloans 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 Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at:

   http://standardandpoorsdisclosure-17g7.com/1111517.pdf

RATINGS LIST

Class                Rating
                To            From

Eurosail-UK 2007-3BL PLC

EUR345 Million, GBP278.275 Million,
US$300 Million Mortgage-Backed Floating-Rate Notes
and an Overissuance Excess-Spread-Backed Floating-Rate Notes

Ratings Lowered

A2a            BB- (sf)        BB (sf)
A2b            BB- (sf)        BB (sf)
A2c            BB- (sf)        BB (sf)
C1a            CCC (sf)        B- (sf)
C1c            CCC (sf)        B- (sf)
D1a            CCC (sf)        B- (sf)
E1c            CCC (sf)        B- (sf)

Ratings Affirmed

A3a            B- (sf)
A3c            B- (sf)
B1a            B- (sf)
B1c            B- (sf)


EXPRO HOLDINGS: S&P Puts 'CCC+' Corp. Credit Rating on Watch Pos
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'CCC+' long-term
corporate credit rating on U.K. oil field services company Expro
Holdings U.K. 3 Ltd. on CreditWatch with positive implications.

At the same time, S&P placed these issue ratings on CreditWatch
positive:

* "The 'B+' issue rating on the US$160 million super-senior
   revolving credit facility (RCF) issued for Expro Holdings U.K.
   4 Ltd. (not rated). The recovery rating on the RCF is '1+',
   reflecting our expectation of full (100%) recovery for
   creditors in an event of default," S&P said.

* "The 'B-' issue rating on Expro's $1.35 billion senior secured
   term loan D. The recovery rating on the loan is '2',
   reflecting our expectation of substantial (70%-90%) recovery
   in an event of default," S&P said.

* "The 'B-' issue rating on the $1.4 billion senior secured
    notes due 2016, issued by Expro Finance Luxembourg S.C.A. The
    recovery rating on the notes is '2', reflecting our
    expectation of substantial (70%-90%) recovery in an event of
    default," S&P said.

* "The 'CCC' issue rating on the $869 million mezzanine loan
   issued for Expro Holdings U.K. 4. The recovery rating on the
   loan is '5', reflecting our expectation of modest (10%-30%)
   recovery in an event of default.The CreditWatch placement
   follows Expro's announcement that it intends to sell its
   Connectors and Measurements division to German industrial
   conglomerate Siemens AG (A+/Positive/A-1+) for $630 million.
   (This sum represents almost 30% of Expro's total Standard &
   Poor's-adjusted debt of $2.26 billion, which excludes the very
   substantial $3.5 billion shareholder loan outstanding)," S&P
   said.

"We anticipate that, as specified in the senior secured notes
indenture, Expro will use the majority of the net proceeds from
the sale to reduce first-lien debt, which stands at $1.35
billion, with the balance used to fund growth. This debt
reduction could include an offer to redeem the senior secured
notes at par (plus any applicable premium and accrued interest),"
S&P said.

"The CreditWatch positive placement reflects the possibility that
we could raise our rating on Expro by one notch if the sale
proceeds are used to materially reduce debt, subject to Expro's
financial metrics and business prospects being commensurate with
a 'B-' rating. Specifically, an upgrade will depend on our view
of Expro's ability to generate sufficient operating cash flow to
cover capital expenditures and to return adjusted debt to EBITDA
to 6.5x or less in the next 12 to 18 months. An upgrade will also
be contingent on liquidity remaining 'adequate' over the next two
years, in line with our criteria," S&P said.

"We could remove the long-term rating from CreditWatch and affirm
it at 'CCC+' if we conclude that negative free operating cash
flow is likely to continue draining liquidity in 2012-2013 and
2013-2014," S&P said.

"We intend to resolve the CreditWatch placement in the next three
months, once the sale has been completed," S&P said.


HEALTHCARE LOCUMS: Expresses Going Concern Doubt
------------------------------------------------
Alexandra Stevenson at The Financial Times reports that
Healthcare Locums admitted on Monday that there was "material
uncertainty" over its ability to continue as a going concern, as
it faces litigation from shareholders and comes up against
banking covenants.

Last year, new management stepped in after an internal
investigation revealed accounting irregularities and failures of
corporate governance, the FT recounts.

The findings led to a restatement of the 2010 accounts, as well
as the resignation of Diane Jarvis, financial director, and the
sacking of Kate Bleasdale, executive vice-chairman, the FT
relates.

In September, the company narrowly escaped insolvency through a
GBP60 million equity placing, which allowed it to pay off some
debt, the FT states.

It also renegotiated its loans, turning some of its debt into a
GBP10.2 million zero-coupon loan, which it said it was not
required to repay until September 2021, the FT says.

Reporting a GBP12.9 million pre-tax loss for 2011, against a
GBP63.6 million loss for 2010, Healthcare Locums chairman Peter
Sullivan, as cited by the FT, said the year "saw the nadir in the
company's fortunes".

Healthcare Locums' net debt at the end of 2011 was GBP26 million,
down from GBP104 million at the end of 2010, the FT discloses.
It would not disclose details of its banking covenants, the FT
notes.

The company is being sued by US investors, who have alleged that
it misrepresented its accounts, the FT says.  It said on Monday
that it had been "unable to form a view as to whether any
liability exists", or to quantify the claim, the FT relates.  It
is also being sued for unfair dismissal, victimization and sex
discrimination by Ms. Bleasdale, who is claiming damages of GBP12
million, according to the FT.

Healthcare Locums said no provision had been made in its accounts
for any legal costs or settlement regarding the cases, the FT
relates.  However, it added that any material judgment against it
would force it to seek new funds, the FT notes.

Healthcare Locums is a UK-based medical recruitment agency.


RMAC 2006-NS2: S&P Lowers Rating on Class B2a Notes to 'B-'
-----------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions in U.K. residential mortgage-backed securities (RMBS)
transactions RMAC 2006-NS2 PLC, RMAC 2006-NS3 PLC, and RMAC
2006-NS4 PLC.

"The rating actions follow our credit and cash flow analysis of
the most recent transaction information that we have received
(December 2011). Our analysis reflects our U.K. RMBS criteria. In
addition, we have applied our 2010 counterparty criteria, given
the recent downgrades of the transaction counterparties," S&P
said.

"After applying our updated U.K. RMBS criteria to these
transactions, our credit analysis results show an increase in the
weighted-average loss severity (WALS) at each rating level. The
change in the WALS is mainly due to the application of our market
value decline assumptions, and is the driving factor behind the
increase in the required credit coverage at each rating level for
each transaction," S&P said.

"Under our updated U.K. RMBS criteria, we model varying recession
timings, with the furthest recession timing starting at the end
of the third year. Our scenario in which the recession starts in
month 37 is the most stressful scenario in our analysis. The
results from this scenario are the main factor in our rating
decision for each transaction," S&P said.

                        RMAC 2006-NS2

"We have affirmed and removed from CreditWatch negative our
ratings on RMAC 2006-NS2's class A2a, A2c, M1a, and M1c notes. We
have also lowered our ratings on the class M2c, B1a, B1c, and B2a
notes," S&P said.

"Credit enhancement within this transaction continues to
increase, due to deleveraging and a fully funded and non-
amortizing reserve fund. The transaction is currently paying
sequentially, as the pro rata conditions have not been met. This
is because 90+ day arrears (currently 21.46%) are greater than
the required trigger of 17%. We have considered the likelihood of
the transaction paying pro rata at some point in the future in
our cash flow analysis," S&P said.

"RMAC 2006-NS2's class A2a, A2c, M1a, and M1c notes pass our cash
flow scenarios at higher rating levels after the application of
our updated U.K. RMBS criteria. However, we do not consider the
currency swap counterparty documentation to be in line with our
2010 counterparty criteria. Under our 2010 counterparty criteria,
the highest potential rating on the notes is one notch above the
long-term issuer credit rating (ICR) on the swap counterparty.
Consequently, these ratings are capped at the rating on the ICR,
plus one notch on the currency swap provider (Royal Bank of
Scotland PLC; A/Stable/A-1)," S&P said.

                     RMAC 2006-NS3

"In the RMAC 2006-NS3 transaction, we have affirmed our ratings
on the class A2a and B1c notes. We have also lowered our ratings
on the class M1a, M1c, and M2c notes. Our rating on the class A2a
notes remains on CreditWatch negative for counterparty reasons,"
S&P said.

"Since our last review in August 2009, 90+ day delinquencies have
been stable. Credit enhancement continues to increase for all
classes of notes, due to the deleveraging of the transaction. The
reserve fund has been topped up and has been fully funded since
September 2011. There have been no draws on the liquidity
facility over the life of the transaction, and excess spread has
begun to build up," S&P said.

"This transaction is currently amortizing sequentially, with 90+
day delinquencies (20.39%) greater than the pro-rata trigger of
17%. We have considered the likelihood of the transaction paying
pro rata at some point in the future in our cash flow analysis,"
S&P said.

"The RMAC 2006-NS3 class A2a notes pass our cash flow scenarios
at higher rating levels after the application of our updated U.K.
RMBS criteria. However, we do not consider the currency swap
counterparty documentation to be in line with our 2010
counterparty criteria. Under our 2010 counterparty criteria, the
highest potential rating on the notes is one notch above the
long-term ICR on the swap counterparty. Consequently, these
ratings are capped at the ICR plus one notch on the currency swap
provider (Credit Suisse International; A+/Negative/A-1)," S&P
said.

                          RMAC 2006-NS4

"As a result of our downgrade of the currency swap provider, we
have lowered our rating on the class A3a notes in the RMAC 2006-
NS4 transaction. Our ratings on the class A2a and A3a notes
remain on CreditWatch negative for counterparty reasons. We have
also lowered and removed from CreditWatch negative our ratings on
the class M1a, M1c, M2a, M2c, B1a, and B1c notes," S&P said.

"Credit enhancement continues to increase, due to the
deleveraging of the transaction. The reserve fund amount is
GBP13.125 million, which represents 1.9% of the current note
balance. Net excess spread is at 0.37% of the current note
balance. Repossessions remain stable at 1%, while the cumulative
principal loss has increased during the past year," S&P said.

"This transaction is currently paying sequentially because the
90+ day delinquency level of 20.09% is greater than the pro rata
trigger of 17%. We have considered the likelihood of the
transaction paying pro rata at some point in the future in our
cash flow analysis," S&P said.

"Our 'AAA (sf)' rating on RMAC 2006-NS4's class A2a notes remains
on CreditWatch negative for counterparty reasons, as the bank
account provider (Barclays Bank PLC) has breached its transaction
document trigger. We are not capping our rating on these notes to
the rating on the swap counterparty, as we expect them to be paid
in one year. Our rating on this class of notes is no longer on
CreditWatch due to the application of our U.K. RMBS criteria,"
S&P said.

                      CREDIT STABILITY

"We also consider credit stability in our analysis, to determine
whether or not an issuer or security has a high likelihood of
experiencing adverse changes in the credit quality of its pool
when we apply moderate stresses. However, the scenarios that we
considered under moderate stress conditions did not result in the
ratings deteriorating below the maximum projected deterioration
that we would associate with each relevant rating level, as
outlined in our credit stability criteria," S&P said.

RMAC 2006-NS2, RMAC 2006-NS3, and RMAC 2006-NS4 are U.K. RMBS
transactions, backed by nonconforming U.K. residential mortgages
originated by GMAC Residential Funding Co.

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

   http://standardandpoorsdisclosure-17g7.com/1111517.pdf

RATINGS LIST

Class                 Rating
            To                    From

RMAC 2006-NS2 PLC
EUR365.9 Million, GBP317.2 Million, and
US$243 Million Mortgage-Backed Floating-Rate Notes

Ratings Affirmed and Removed From CreditWatch Negative

A2a         A+ (sf)               A+ (sf)/Watch Neg
A2c         A+ (sf)               A+ (sf)/Watch Neg
M1a         A+ (sf)               A+ (sf)/Watch Neg
M1c         A+ (sf)               A+ (sf)/Watch Neg

Ratings Lowered and Removed From CreditWatch Negative

M2c         BBB- (sf)             BBB+ (sf)/Watch Neg
B1a         B (sf)                BB+ (sf)/Watch Neg
B1c         B (sf)                BB+ (sf)/Watch Neg
B2a         B- (sf)               B+ (sf)/Watch Neg

RMAC Securities No.1 2006-NS3
GBP389.5 Million, EUR200 Million, and
US$421.6 Million Mortgage-Backed Floating-Rate Notes

Ratings Lowered and Removed From CreditWatch Negative

M1a         BBB (sf)              A+ (sf)/Watch Neg
M1c         BBB (sf)              A+ (sf)/Watch Neg
M2c         B (sf)                BBB (sf)/Watch Neg

Rating Remaining on CreditWatch Negative[1]

A2a         AA- (sf)/Watch Neg

Rating Affirmed

B1c         B- (sf)               B- (sf)

RMAC 2006-NS4 PLC
EUR263.8 Million, GBP830 Million, and
US$477 Million Mortgage-Backed Floating-Rate Notes

Rating Remaining on CreditWatch Negative[1]

A2a         AAA (sf)/Watch Neg

Rating Lowered and Remaining on CreditWatch Negative[1]

A3a         AA- (sf)/Watch Neg    AA (sf)/Watch Neg

Ratings Lowered and Removed From CreditWatch Negative

M1a         BBB+ (sf)             AA (sf)/Watch Neg
M1c         BBB+ (sf)             AA (sf)/Watch Neg
M2a         BB+ (sf)              A- (sf)/Watch Neg
M2c         BB+ (sf)              A- (sf)/Watch Neg
B1a         B- (sf)               B (sf)/Watch Neg
B1c         B- (sf)               B (sf)/Watch Neg

[1]These ratings are no longer on CreditWatch negative for
criteria-related reasons, but remain on CreditWatch negative for
counterparty-related reasons.


VICTORIA FUNDING: S&P Lowers Rating on Class E Notes to 'B-'
------------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on Victoria Funding (EMC-III) PLC's notes.

Specifically, S&P:

- Raised its rating on the class D notes;

- Lowered its rating on the class E notes; and

- Affirmed its ratings on the class B and C notes.

"The transaction, which closed in October 2005, was originally
backed by seven loans. One of the remaining two loans -- the
Zeloof loan -- recently repaid in full on the loan maturity date
of March 8, 2012," S&P said.

"We expect that, at the April 2012 interest payment date (IPD),
the proceeds of this loan will be applied to the notes to reduce
the note cumulative balance to GBP2,119,523," S&P said.

"The notes will then be backed by the Brisk loan, which is
secured by a parade of seven secondary retail units in Coventry
city center, U.K. The Brisk loan failed to pay at its maturity
date in September 2011, leaving two years to work out the last
loan in this transaction, as the notes mature in April 2014," S&P
said.

                      ZELOOF LOAN REPAYMENT

"The Zeloof loan repaid at its maturity on March 8, 2012. We
expect the servicer to apply the loan proceeds (GBP20 million) to
pay down the notes on the next IPD in April 2012, redeeming the
class B and C notes in full. In such a scenario, we will withdraw
the ratings on the class B and C notes. The total balance for the
class D and E notes would then be GBP2,119,522. We expect the
post-redemption class balances to be GBP257,732 for the class D
notes, and GBP1,861,790 for the class E notes," S&P said.

                        THE BRISK LOAN

The Brisk loan is the last remaining loan in the pool. The loan
defaulted at its maturity in September 2012 and is currently in
workout with the special servicer, Citibank International PLC
(A/Negative/A-1).

"The loan is secured by a parade of seven retail units in
Coventry city center. The assets are all let on five- to 25-year
leases occupied by what we consider to be average tenants. The
current weighted-average unexpired lease term is 10.15 years and
one of the smallest units is currently vacant. Tenants include
Betfred, and Greggs. The valuation of the assets at July 2004 was
reported at GBP3.05 million. A new valuation has been
commissioned by the special servicer. We have not seen, nor do we
know who is undertaking the valuation," S&P said.

"We understand that the special servicer continues to discuss a
workout strategy with the borrower, and that the borrower is
still seeking refinance options. If the borrower does not
refinance the loan within a reasonable timescale, we anticipate
that the servicer will enforce the loan, particularly as there is
only two years before the note maturity," S&P said.

"Based on the 2004 valuation alone, there would be sufficient
proceeds to repay the class D and E notes in full. However, in
our view, the assets are secondary assets in a secondary
location, and investor appetite for such assets remains
constrained. Accordingly, we envisage that there may be small
losses on the loan if the assets are enforced," S&P said.

"Given that the class D notes will have a note-to-value ratio
(based on the 2004 valuation) of about 10% after the class B and
C notes are redeemed, we expect the class D notes to repay in
full, regardless of any principal losses which may occur as a
result of enforcing assets backing the Brisk loan. The losses
will likely be confined to the class E notes," S&P said.

                       INTEREST SHORTFALLS

"The class E notes have been experiencing interest shortfalls as
a result of other loan repayments, which means there is
insufficient income to cover interest due on this class. This
interest is accrued every quarter (it currently stands at
EUR177,442). The interest becomes due at the note maturity,
albeit near the bottom of the waterfall in priority. We believe
there will not be enough cash available to repay the accrued
interest balance at note maturity or before. This risk over the
remaining term of the transaction is captured in our 'B- (sf)'
rating on the class E notes," S&P said.

"In addition, we anticipate that the servicer will need to draw
on the liquidity facility in certain quarters where costs exceed
the interest income from the Brisk loan. Our understanding is
that the special servicer is able to draw on the liquidity
facility in this scenario. However, any liquidity drawings will
ultimately reduce the principal recoveries available to repay the
class E notes," S&P said.

                         RATING ACTIONS

"We expect the issuer to apply the Zeloof loan proceeds to redeem
the class B and C notes on the next IPD. Accordingly,  we have
affirmed our 'AAA (sf)' ratings on these classes," S&P said.

"We have raised our rating on the class D notes to 'A (sf)'. This
rating rests on the assumption that the servicer will work out
the Brisk loan in a timely manner, well in advance of the
maturity of the notes in 2014. If developments suggest that this
is not taking place, we would reassess our rating on this class,"
S&P said.

"We have lowered our rating on the class E notes to 'B- (sf)', to
reflect our view that there is a risk of principal losses on this
class, although we anticipate these losses will be small. We also
anticipate that accrued interest on the class will not be repaid
in full," S&P said.

         POTENTIAL EFFECTS OF PROPOSED CRITERIA CHANGES

"We have taken the rating actions based on our criteria for
rating European commercial mortgage-backed securities (CMBS).
However, these criteria are under review," S&P said.

"As highlighted in the Nov. 8 Advance Notice of Proposed Criteria
Change, we expect to publish a request for comment (RFC)
outlining our proposed criteria changes for rating European CMBS
transactions. Subsequently, we will consider market feedback
before publishing our updated criteria. Our review may result in
changes to the methodology and assumptions we use when rating
European CMBS, and consequently, it may affect both new and
outstanding ratings on European CMBS transactions. Until such
time that we adopt new criteria for rating European CMBS, we will
continue to rate and surveil these transactions using our
existing criteria," 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 Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at:

   http://standardandpoorsdisclosure-17g7.com/1111517.pdf

RATINGS LIST

Class           Rating
          To              From

Victoria Funding (EMC-III) PLC
GBP263 Million Commercial Mortgage-Backed Floating-Rate Notes

Rating Raised

D         A (sf)          BBB (sf)

Rating Lowered

E         B- (sf)         BB (sf)

Ratings Affirmed

B         AAA (sf)
C         AAA (sf)


                            *********

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


                            *********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Europe is a daily newsletter co-
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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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