TCREUR_Public/120627.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, June 27, 2012, Vol. 13, No. 127

                            Headlines



G E R M A N Y

LEHMAN BROTHERS: Deal With LBC GmbH Administrator Okayed


I R E L A N D

BLOXHAM: High Court Confirms Appointment of Liquidator
MJBCH LTD: High Court Judge Appoints Liquidator


I T A L Y

* ITALY: Expects to Approve Decree to Help Boost Bank Capital


L U X E M B O U R G

KLEOPATRA LUX: Moody's Cuts PDR to Ca/LD on Finc'l Restructuring
SLS CAPITAL: Luxembourg Firm Files in US Amid Missing Funds


N E T H E R L A N D S

MARCO POLO: U.S. Court OKs Global Settlement with Lenders
UNIVAR NV: Bank Debts Trade Near 3% Off in Secondary Market


P O L A N D

HYDROBUDOWA POLSKA: May Face Civil Suits From 60 Subcontractors


R O M A N I A

BRD - GROUPE: Moody's Cuts Standalone BFSR to 'D-'; Outlook Neg.


S P A I N

* SPAIN: Moody's Downgrades Deposit Ratings of 28 Banks


U N I T E D   K I N G D O M

CINRAM INT'L: Files for Bankruptcy in Canada & US to Sell Biz
LEHMAN BROTHERS: UK Units Could Be Forced to Back Pension Scheme
LEHMAN BROTHERS: E&Y Cleared by UK Regulators Over Reports
NORTEL NETWORKS: UK Pension Regulators Can't Appeal
SOUTH LONDON: Put Into Administration; Job Cuts Likely


X X X X X X X X

* Moody's: EU Transport Infrastructure Sector Has Neg. Outlook


                            *********


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G E R M A N Y
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LEHMAN BROTHERS: Deal With LBC GmbH Administrator Okayed
--------------------------------------------------------
Lehman Brothers Holdings Inc. obtained an order from the U.S.
Bankruptcy Court for the Southern District of New York approving
the settlement of claims with the administrator of Lehman
Brothers Capital GmbH.

Under the deal, LB Capital will have allowed unsecured claims
totaling more than US$36.9 million against Lehman, and another
US$209,132 in unsecured claim against the company's special
financing unit.  Lehman's commercial paper unit will have
GBP72,998 in unsecured claim against LB Capital.

The claim against Lehman stemmed from its guarantee of amounts
due from Lehman Brothers Bankhaus AG related to an intercompany
receivable for LB Capital's deposit of certain cash receipts.

The two other claims were filed against Lehman's special
financing unit and LB Capital related to non-trading general
intercompany accounts.

LB Capital, a German affiliate of Lehman, was created for trading
with third parties.  The trades, which occurred around 2003 and
2004, generated cash that was placed with Lehman and LB Bankhaus.
In exchange for the cash, LB Capital, which is under insolvency
proceeding, received intercompany receivables from both
companies.

                     About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States.  For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.

Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555).  Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history.  Several other affiliates followed
thereafter.

Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.

The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman.  Epiq
Bankruptcy Solutions serves as claims and noticing agent.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)).  James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.

The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion.  Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees.  Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.

Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history.  Lehman is set to make its first payment to creditors
under its $65 billion payout plan on April 17, 2012.

               International Operations Collapse

Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd.  Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008.  The joint
administrators have been appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16.  Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.

Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates.  (http://bankrupt.com/newsstand/or 215/945-700)



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I R E L A N D
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BLOXHAM: High Court Confirms Appointment of Liquidator
------------------------------------------------------
Tim Healy at Independent.ie reports that the High Court has
confirmed the appointment of a liquidator to Bloxham
stockbrokers.

Last month, the company was ordered to cease trading by the
Central Bank after it was revealed was under capitalized,
Independent.ie recounts.  According to Independent.ie, an
application to have the company wound up was made as the partners
saw "no prospect of an improvement in Bloxham's trading
position."

Its largest creditors include NIB bank, who are owed EUR8.5
million and the revenue commissioners who are owed EUR2.3
million, Independent.ie notes.  The High Court then appointed Mr
Kieran Wallace of the firm KPMG as provisional liquidator,
Independent.ie discloses.

Ms. Justice Mary Laffoy said she was satisfied to confirm Mr.
Wallace as both liquidator and administrator to Bloxham after
being informed that the company was insolvent, unable to pay its
debts and that its liabilities exceeded its assets by EUR13.9
million, Independent.ie relates.

The judge adjourned the matter to a date in July, Independent.ie
says.  The court heard that Bloxham's major creditors and the
Central Bank were adopting a neutral position in regards to the
petition to have the firm wound up, Independent.ie states.

Bernard Dunleavy Bl for Bloxham, which is a limited partnership,
said the company got into difficulties after it discovered that
regulatory capital had been overstated by EUR5 million,
Independent.ie relates.  It was obliged to hold regulatory
capital EUR5.6 million, Independent.ie notes.

Bloxham's partners unanimously agreed following a meeting that
the company should be wound up, and that a liquidator be
appointed, Independent.ie discloses.

Bloxham is one of Ireland's oldest stockbrokers.


MJBCH LTD: High Court Judge Appoints Liquidator
-----------------------------------------------
Tim Healy at Irish Independent reports that Ulster Bank,
represented by Declan Murphy, on Monday petitioned the court to
appoint a liquidator to MJBCH Ltd. after the firm failed to
satisfy a demand it made for the repayment of EUR262 million
advanced to purchase the sites.

The High Court's Ms. Justice Mary Laffoy appointed Declan Taite
of RSM Farrell Grant Sparks as official liquidator to the company
after finding that it was hopelessly insolvent and unable to pay
its debts, Irish Independent relates.

The court heard that the company was established in 2006 as
Mountbrook Merrion Road Development Ltd. before changing its name
to MJBCH in October 2007, Irish Independent recounts.  The
company's directors are Sean Dunne and Ross Connolly, Irish
Independent discloses.

Mr. Murphy, as cited by Irish Independent, said the bank served a
formal demand on the company for the payment of EUR262 million in
May of this year. However, the company had failed to repay the
amount sought, Irish Independent notes.

According to Irish Independent, the bank was now seeking the
appointment of a liquidator as it was in the best interest of all
the parties concerned.

The judge, after making orders winding up the company, adjourned
the case and made it returnable before a sitting of the
Examiner's Court later this year, Irish Independent says.



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I T A L Y
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* ITALY: Expects to Approve Decree to Help Boost Bank Capital
-------------------------------------------------------------
Sonia Sirletti and Chiara Vasarri at Bloomberg News report that
Italy may approve a decree to help banks to boost capital through
the sale of bonds to the government, as Banca Monte dei Paschi di
Siena SpA prepares to raise at least EUR1 billion (US$1.3
billion) using the securities.

According to Bloomberg, two people familiar with the matter said
that ministers were expected to pass the measure on Monday at a
Cabinet meeting in Rome.

Bloomberg notes that one of the people said the legislation
probably will be similar to the decree approved in 2009 that
allowed lenders to issue so-called Tremonti-bonds, which were
named after then Treasury Minister Giulio Tremonti.



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


KLEOPATRA LUX: Moody's Cuts PDR to Ca/LD on Finc'l Restructuring
----------------------------------------------------------------
Moody's Investors Service has downgraded the probability of
default rating of Kleopatra Lux 1 S.a.r.l., the holding company
of German plastic packaging manufacturer Kloeckner Pentaplast, to
Ca/LD. The company's Caa2 Corporate Family Rating has been
affirmed and the outlook on all ratings has been changed to
stable from negative. Moody's expects to remove the "/LD" suffix
after approximately three business days and to withdraw all
ratings shortly thereafter.

Ratings Rationale

The rating action reflects Moody's understanding that a financial
restructuring has been implemented with the following key
elements: (i) repayment of senior lenders at par amounting to
approximately EUR800 million, (ii) effective equitization of
second lien and mezzanine commitments and (iii) assumption of
ownership by Strategic Value Partner and other previous second
lien and mezzanine lenders via the debt-to-equity swap and
additional EUR190 million of new equity.

The effective equitization of second lien and mezzanine debt
constitutes a distressed exchange and an event of default under
Moody's definition and leads to the downgrade of the probability
of default rating to Ca.

As a result, the debt load of the Kloeckner Pentaplast group
(excluding Moody's adjustments) has reduced by approximately 50%
to approximately EUR630 million post closing of the transaction.

The Caa2 Corporate Family Rating reflects the recovery rate under
the previous financing structure considering that senior lenders,
representing about 70% of total debt outstanding as of March
2012, have been repaid in full. It also reflects the historically
stable operating performance of Kloeckner Pentaplast as well as
current trading in line with expectation.

The stable outlook reflects that the transaction is already
funded and repayment of the senior lenders has occurred as well
as Moody's expectation of withdrawing the ratings shortly.

Downgrades:

  Issuer: Kleopatra Lux 1 S.a.r.l.

     Probability of Default Rating, Downgraded to Ca/LD from Caa3

Outlook Actions:

  Issuer: Kleopatra Lux 1 S.a.r.l.

    Outlook, Changed To Stable From Negative

The principal methodology used in rating Kleopatra Lux 1 S.a.r.l.
was the Global Packaging Manufacturers: Metal, Glass, and Plastic
Containers Industry Methodology published in June 2009.

Kleopatra Lux 1 S.a.r.l., with legal domicile in Luxembourg, is a
global leader in the manufacturing of rigid plastic films for the
pharmaceutical, food, medical, electronics and other packaging
industry. The group generated EUR1.2 billion of sales in the last
twelve months ending March 2012.


SLS CAPITAL: Luxembourg Firm Files in US Amid Missing Funds
-----------------------------------------------------------
Liquidators of Luxembourg based SLS Capital S.A. filed in
Manhattan, New York, a petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 12-12707) to seek
recognition of proceedings in Luxembourg as "foreign main
proceeding".

Maitre Yann Baden, the liquidator and foreign representative,
estimated SLS Capital to have assets and debts of $100 million to
$500 million.

SLS was a financial services company whose primary business was
the issuance of bonds to persons residing outside the United
States.  In the operation of its business SLS had counterparties
and advisors in the United States and had significant assets held
in custodial asset and cash accounts in New York City. The assets
held in the United States were the primary collateral for the
bonds that SLS issued.

On June 4, 2009, the State Prosecutor in Luxembourg filed an
application in the District Court of and in Luxembourg (Case
Number L-6258/09), to wind up and order the liquidation of SLS, a
Luxembourg joint stock company, pursuant to Article 203 of the
law of 10 August 1915 of Luxembourg, as subsequently amended.

On Oct. 1, 2009, the Luxembourg Court ordered the dissolution of
SLS and placed SLS into liquidation "declar[ing] applicable those
legal provisions pertaining to the liquidation of a bankruptcy"
and "appoint[ing] as magistrate in bankruptcy [Supervising Judge]
Mrs. Carole BESCH, judge with the Luxembourg Court, and
designat[ing] as liquidator Maitre Yann BADEN, lawyer residing in
Luxembourg. . . ."

The liquidator says that there is need for U.S. recognition of
the Luxembourg proceeding.  As part of the process of marshaling
SLS's assets and paying SLS's debts, the SLS Liquidator seeks to
investigate the disappearance of SLS's assets including assets
held in custodial accounts and to pursue such actions as are
appropriate in order to recover SLS's assets and/or seek damages
from culpable third parties.



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N E T H E R L A N D S
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MARCO POLO: U.S. Court OKs Global Settlement with Lenders
---------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved a global settlement agreement among Marco Polo Seatrade
B.V., et al., The Royal Bank of Scotland plc, Credit Agricole
Corporate and Investment Bank, Norddeustsche Landesbank
Girozentrale and the Official Committee of Unsecured Creditors.

The agreement provides for, among other things:

   -- approval of the assumption and assignment of certain
      executory contracts and unexpired leases and related
      procedures; and

   -- modification of the automatic stay.

As part of their negotiation of the agreement, the Debtors, RBS
and the Committee engaged in discussions regarding the extent to
which the working capital reserves, if any, under the Global
Tanker Pool Pte Ltd Pool Agreement, dated March 24, 2009, to
which Marco Polo Seatrade B.V. is a party constitute the
collateral of RBS.  The parties have agreed that with respect to
any Global Tanker Pool Reserves that are payable to the Debtors
under the Global Pool Agreement, 66.66% of the amounts will be
paid to RBS and 33.33% of the amounts will be paid to the Debtors
or to the Liquidation Trustee, as applicable, for distribution to
general unsecured creditors pursuant to the Plan.

A full-text copy of the terms of the settlement is available for
free at http://bankrupt.com/misc/MARCOPOLO_settlement_order.pdf

                         About Marco Polo

Marco Polo Seatrade B.V. operates an international commercial
vessel management company that specializes in providing
commercial and technical vessel management services to third
parties. Founded in 2005, the Company mainly operates under the
name of Seaarland Shipping Management and maintains corporate
headquarters in Amsterdam, the Netherlands.  The primary assets
consist of six tankers that are regularly employed in
international trade, and call upon ports worldwide.

Marco Polo and three affiliated entities filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-13634) on July 29,
2011.  The other affiliates are Seaarland Shipping Management
B.V.; Magellano Marine C.V.; and Cargoship Maritime B.V.

Marco Polo is the sole owner of Seaarland, which in turn is the
sole owner of Cargoship, and also holds a 5% stake in Magellano.
The remaining 95% stake in Magellano is owned by Amsterdam-based
Poule B.V., while another Amsterdam company, Falm International
Holding B.V. is the sole owner of Marco Polo.  Falm and Poule
didn't file bankruptcy petitions.

The filings were prompted after lender Credit Agricole Corporate
& Investment Bank seized one ship on July 21, 2011, and was on
the cusp of seizing two more on July 29.  The arrest of the
vessel was authorized by the U.K. Admiralty Court.  Credit
Agricole also attached a bank account with almost US$1.8 million
on July 29.  The Chapter 11 filing precluded the seizure of the
two other vessels.  The company started a lawsuit against the two
creditors in January 2012.

The cases are before Judge James M. Peck.  Evan D. Flaschen,
Esq., Robert G. Burns, Esq., and Andrew J. Schoulder, Esq., at
Bracewell & Giuliani LLP, in New York, serve as the Debtors'
bankruptcy counsel.  Kurtzman Carson Consultants LLC serves as
notice and claims agent.

The petition noted that the Debtors' assets and debts are both
more than US$100 million and less than US$500 million.

Tracy Hope Davis, the United States Trustee for Region 2,
appointed three members to serve on the Official Committee of
Unsecured Creditors.  The Committee has retained Blank Rome LLP
as its attorney.

Creditor Credit Agricole Corporate and Investment Bank is
represented by Alfred E. Yudes, Jr., Esq., and Jane Freeberg
Sarma, Esq., at Watson, Farley & Williams (New York) LLP.

Gregory M. Petrick, Esq., Ingrid Bagby, Esq., and Sharon J.
Richardson, Esq., at Cadwalader, Wickersham & Taft LLP, in New
York, represents secured creditor and post-petition lender The
Royal bank of Scotland plc.


UNIVAR NV: Bank Debts Trade Near 3% Off in Secondary Market
-----------------------------------------------------------
Participations in a syndicated loan under which Univar NV is a
borrower traded in the secondary market at 97.21 cents-on-the-
dollar during the week ended Friday, June 22, an increase of 0.54
percentage points from the previous week according to data
compiled by LSTA/Thomson Reuters MTM Pricing and reported in The
Wall Street Journal.  The Company pays 350 basis points above
LIBOR to borrow under the facility.  The bank loan matures on
March 2, 2017, and carries Moody's B2 rating and Standard &
Poor's B+ rating.  The loan is one of the biggest gainers and
losers among 140 widely quoted syndicated loans with five or more
bids in secondary trading in the week ended Friday.



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P O L A N D
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HYDROBUDOWA POLSKA: May Face Civil Suits From 60 Subcontractors
---------------------------------------------------------------
Minda Alicja at Polska Agencja Prasowa reports that Hydrobudowa
Polska may face civil law suits from around 60 subcontractors,
who claim overdue payments of PLN49 million.

As reported by the Troubled Company Reporter-Europe on June 13,
2012, Bloomberg News related that the Poznan District Court on
June 11 agreed to declare Hydrobudowa Polska bankrupt with the
aim of allowing the builder to reach asettlement with its
creditors.

Hydrobudowa Polska is a unit of PBG SA, Poland's third largest
builder.



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R O M A N I A
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BRD - GROUPE: Moody's Cuts Standalone BFSR to 'D-'; Outlook Neg.
----------------------------------------------------------------
Moody's Investors Service has taken rating actions on five
subsidiaries of Societe Generale (SocGen), domiciled in the Czech
Republic, Romania and Russia -- namely Komercni Banka (Czech
Republic), BRD - Groupe Societe Generale (Romania) and three
Russian entities: Rosbank, DeltaCredit Bank and Rusfinance Bank.

These rating actions follow the recent downgrade of SocGen's
long-term debt and deposit ratings by one notch, to A2 from A1,
and the lowering of SocGen's standalone financial strength by one
notch to C-/baa2 from C-/baa1. The outlook on both the standalone
financial strength and long-term debt and deposit ratings is
stable.

Moody's says that the rating actions conclude the reviews Moody's
initiated on December 16, 2011 for the Russian subsidiaries --
Rosbank, DeltaCredit Bank and Rusfinance Bank; on February 21,
2012 for Komercni Banka (Czech Republic); and on December 16,
2011 for BRD - Groupe Societe Generale (Romania), with the scope
of the review for BRD expanded on June 1, 2012.

The drivers of Moody's rating actions on the five subsidiaries
vary and reflect a combination of different factors, including
(i) the reduction in the financial capacity of SocGen as a
support provider, as indicated by SocGen's recent rating
downgrade; (ii) the rating agency's concerns that group level
pressures may impact financial strength at the subsidiary level;
and (iii) the impact of weakening domestic operating
environments.

RATINGS RATIONALE -- KOMERCNI BANKA (CZECH REPUBLIC)

Moody's took the following rating actions on Komercni Banka:

- standalone bank financial strength rating (BFSR) downgraded to
   C-/baa1 from C/a3; the outlook on the BFSR is stable

- long-term local and foreign currency deposit ratings of A2, as
   well as the Prime-1 short-term local and foreign currency
   deposit ratings, confirmed; the outlook on the long-term
   deposit ratings is negative

Moody's says that the one-notch downgrade of Komercni Banka's
standalone BFSR to C-/baa1, which compares to the SocGen's
standalone BFSR of C-/baa2, reflects (i) the recent weakening in
the Czech operating environment that Moody's believes will likely
dampen earnings generation and pressure asset quality, and (ii)
Moody's view that the weakening of SocGen's standalone credit
profile heightens the risks posed by the close interlinkages
between SocGen and the Czech subsidiary.

-- WEAKENING OPERATING ENVIRONMENT

Moody's says that the operating environment in the Czech Republic
has weakened, as illustrated by the slowdown in economic output
and further downside risks related to softer export demand from
European trading partners. Real GDP contracted by 0.7% year-on-
year in Q1 2012, and Moody's expects GDP growth of 0% in 2012,
compared to 1.7% in 2011, whilst the European Commission
forecasts an unemployment rate of 7.2% in 2012.

Despite Komercni Banka's strong capital position -- with a 13.6%
Tier 1 ratio as of end-March 2012 -- and its solid funding
profile, Moody's expects that the economic slowdown in the Czech
Republic will outweigh these mitigating factors. Specifically,
Moody's expects that the weakening operating environment will
constrain earnings and exert pressure on the bank's problem loans
(loans under special review) from the level of 5.7% posted at
year-end 2011.

-- PRESSURES STEMMING FROM LINKAGES WITH PARENT GROUP

Moody's also considers that the weakening of SocGen's standalone
credit profile poses challenges for Komercni Banka and impacts
the Czech subsidiary's standalone credit strength. Moody's
acknowledges that the domestic Czech financial regulator has
tightened the extent to which Czech banks can be exposed to their
parent groups; however, the rating agency also notes the risk of
capital being up-streamed to the parent, which would directly
affect Komercni Banka's capital cushion. Moreover, in the context
of the competitive Czech banking sector, Moody's considers that
there is a risk that overall group restrictions may impact the
extent to which Komercni Banka can increase the volume of its
risk weighted assets and position its franchise. Moody's also
notes that cost reductions at group level may lead to a decline
in operating support that has historically underpinned the bank's
standalone strength.

Moody's recognizes that Komercni Banka is an important part of
SocGen's overall franchise, contributing approximately 12.7% of
SocGen's net income in 2011.

SYSTEMIC SUPPORT ASSUMPTIONS AND NEGATIVE OUTLOOK

The deposit ratings of Komercni Banka, one of the largest banks
in the Czech Republic, benefit from two notches of uplift due to
systemic support, reflecting Moody's assessment of the very high
probability of support from the Czech government, in case of
need.

The negative outlook on Komercni Banka's deposit ratings reflects
the pressures on the bank's standalone performance that could
lead to the bank becoming weakly positioned in the C- BFSR
category, resulting in a lower standalone credit assessment of
baa2.

WHAT COULD MOVE THE RATINGS UP/DOWN

The negative outlook on Komercni Banka's deposit ratings reflects
Moody's expectation that upward pressure on the bank's ratings is
limited at this stage. Over time, the outlook could be changed to
stable if the bank strengthens its performance metrics and/or the
parent group's standalone profile strengthens.

Further downward pressure could be exerted on Komercni Banka's
standalone and deposit ratings following (i) weaker-than-expected
performance at the group level; and/or (ii) a worse-than-expected
weakening of the operating environment.

RATINGS RATIONALE -- BRD -- GROUPE SOCIETE GENERALE (ROMANIA)

Moody's took the following rating actions on BRD - Groupe Societe
Generale (Romania):

- standalone BFSR downgraded to D-/ba3 from D/ba2, the outlook
   on the BFSR is negative

- long-term and short-term local currency deposit ratings
   downgraded to Baa3/Prime-3 from Baa2/Prime-2; the outlook on
   the long-term rating is negative

- long- and short-term foreign currency deposit ratings of
   Baa3/Prime-3 confirmed; the outlook on the long-term deposit
   rating is negative

Moody's says that the rating actions on BRD reflect (i) the
deterioration of the operating environment in Romania, and (ii)
the rapid increase in the bank's non-performing loans,
counterbalanced by (iii) Moody's view of SocGen's continuing
commitment to the Romanian market.

-- WEAKENING OPERATING ENVIRONMENT

Romania's economic performance has deteriorated, as its high
dependence on external markets, particularly in terms of exports
and private sector capital inflows, renders it vulnerable to the
weakening growth prospects of the euro area. In Q4 2011 and Q1
2012, Romania registered mild quarter-on-quarter GDP contraction;
private consumption and job creation remain subdued. Although
Moody's expects economic performance to improve in the coming
years, growth rates will likely remain well below the levels
reported prior to the 2008 global financial crisis (over 6% GDP
growth per annum), which will render income convergence with
wealthier European countries more challenging, given the
significant disparity in household income at 64% below the EU-27
average. Moody's expects the macroeconomic weaknesses to affect
banking sector performance through weak credit demand, lower
revenues and significant asset-quality pressures.

-- DETERIORATING ASSET QUALITY

As a reflection of the weakening operating environment, BRD's
non-performing loans (NPLs) have increased significantly,
reaching 16.8% of the total loan portfolio in December 2011 and
continuing to increase in the first quarter of 2012. The
deterioration in asset quality reflects the bank's (i) large loan
exposure to the country's weak small and medium-sized
enterprises; and (ii) significant level of foreign-currency
lending (mainly euro-denominated), which accounts for
approximately 56% of the total loan portfolio. Furthermore, as a
result of the increase in non-performing loans, in conjunction
with rapidly rising loan-loss charges and subdued credit growth,
Moody's expects that BRD's profitability will remain under
pressure through 2013. In Moody's view, the risk of further
downward pressure on profitability is also driven by the bank's
need to increase its provisioning coverage of NPLs, currently at
a relatively modest 43%.

Although BRD's current capital buffer provides an adequate loss
absorption capacity, with the Tier 1 capital ratio at 14.5% as of
March 2012, the bank's capitalization may provide only a limited
cushion, in Moody's view, if the economic environment in Romania
deteriorates more than currently expected.

-- SUPPORT ASSUMPTIONS AND NEGATIVE OUTLOOK

BRD is the second largest bank in Romania, with market shares of
around 15% in deposits and loans. SocGen holds a 60% stake in the
bank and provides some funding to its subsidiary, mostly to
finance its sizeable foreign-currency portfolio. These
considerations, together with Moody's view of SocGen's commitment
to the Romanian market, underpin Moody's assumptions of parental
and systemic support for the bank, which result in a three-notch
rating uplift from the current ba3 standalone credit assessment.

The outlook on BRD's ratings is negative, reflecting the
possibility that the pressures on asset quality, profitability
and capital, if sustained, could further weaken the bank's credit
profile. Moody's also notes that BRD has some exposure to the
Romania's state-owned electricity generator Hidroelectrica SA,
which recently filed for insolvency, and these developments could
exert additional pressure on the bank's balance sheet.

WHAT COULD MOVE THE RATINGS UP/DOWN

At this stage, upward pressure on the ratings is limited, as
indicated by the negative outlook on the bank's ratings.
Nevertheless, over the longer- term BRD's ability to maintain its
large market position -- coupled with sustainable profitability
and significant asset quality improvements -- could result in
upward pressure on the ratings.

Downward pressure could be exerted if the bank became loss-
making, which would have a material impact on the sustainability
of BRD's large franchise in Romania and on its capitalization
level. In addition, further deterioration in the economic
conditions in Romania, leading to an acceleration in non-
performing loan formation, reduced commitment of the parent bank
and/or downward pressure on Romania's ratings could exert
downward pressure on BRD's ratings.

RATINGS RATIONALE -- ROSBANK, DELTACREDIT BANK AND RUSFINANCE
                     BANK (RUSSIA)

SocGen holds an 82.4% stake in Rosbank, which, in turn, owns
(100%) two other Russian subsidiaries: mortgage lender
DeltaCredit and consumer lender Rusfinance.

Moody's took the following rating actions on these subsidiaries:

Rosbank:

- long- and short-term local and foreign currency deposit
   ratings downgraded to Baa3/Prime-3 from Baa2/Prime-2; the
   outlook on the long-term ratings is stable

- standalone BFSR, which was not subject to the review,
   unchanged at D/ba2, stable outlook

DeltaCredit Bank:

- long-term local and foreign currency deposit ratings
   downgraded to Baa3 from Baa2; the outlook on the long-term
   ratings is stable

- short-term foreign currency rating downgraded to Prime-3 from
   Prime-2

- local currency senior secured debt rating, benefiting from an
   explicit and irrevocable guarantee issued by SocGen,
   downgraded to Baa2 from Baa1; the outlook on the rating is
   stable

- standalone BFSR, which was not subject to the review,
   unchanged at D/ba2, stable outlook

Rusfinance Bank:

- long- and short-term local and foreign currency deposit
   ratings downgraded to Ba1/Not Prime from Baa3/Prime-3; the
   outlook on the long-term ratings is stable

- standalone BFSR, which was not subject to the review, affirmed
   at E+/b1, with stable outlook

The rating actions on the Russian entities is triggered by the
reduction in the financial capacity of SocGen as a support
provider, as indicated by SocGen's recent rating downgrade.

Moody's says that the one-notch downgrades of the Russian
subsidiaries of SocGen were prompted by Moody's downgrade of
SocGen's standalone ratings to C-/baa2, from which Moody's
imputes rating uplifts for parental support.

SUPPORT ASSUMPTIONS

SocGen's Russian sub-group -- including Rosbank, DeltaCredit Bank
and Rusfinance Bank -- ranks among the 10 largest banking groups
in Russia and holds sizeable shares in certain market segments,
such as mortgage lending and consumer finance. Despite the legal
structure of SocGen's Russian sub-group, whereby Rosbank operates
as an immediate parent for DeltaCredit and Rusfinance, Moody's
incorporates a high assumption of parental support for all three
Russian subsidiaries from SocGen directly. This reflects the
close strategic oversight by SocGen over each bank and the
sizeable financial flows between SocGen and each Russian
subsidiary.

Moody's assumption of high parental support is underpinned by (i)
Rosbank's role as a holding entity for all of SocGen's
subsidiaries in Russia, (ii) the alignment of Rosbank's brand
logo with that of SocGen, (iii) the rating agency's assessment of
a material degree of strategic fit of Russian operations to those
of the group, and (iv) SocGen's funding support to its Russian
subsidiaries, mostly through financing a large portion of
operations at DeltaCredit and Rusfinance, which maintain
wholesale-funded business models. Moody's has also observed a
history of capital support from the French parent to the Russian
subsidiaries, and assumes a high likelihood that such support
would be provided in the future, in case of need.

As a result of Moody's assumptions of high parental support,
Rosbank's and DeltaCredit's deposit ratings now incorporate two-
notches uplift to Baa3 (as opposed to three-notches of uplift
previously), from these banks' standalone credit assessments of
ba2, whereas Rusfinance's deposit ratings now incorporate three
notches of uplift to Ba1 (as opposed to four-notches previously),
from the bank's standalone credit assessment of b1.

RUSSIAN SUBSIDIARIES -- WHAT COULD MOVE THE RATINGS UP/DOWN

At this stage, near-term upward rating pressure on Rosbank and
DeltaCredit from either a strengthening of standalone financial
metrics and/or increases in uplift from parental support
assumptions remains limited. In the case of Rusfinance Bank
upward rating pressure could be triggered by (i) diversification
and enhancement of the bank's funding base, resulting in lower
interest expense levels over the longer term, and (ii) its
ability to minimize reliance on the car-financing segment through
diversification into other lending segments.

A reduced commitment of the parent bank towards its Russian
subsidiaries, or a significant deterioration in asset quality,
reduced profit generation and/or weakening liquidity positions
could exert downward pressure on the banks' ratings.

DELTACREDIT'S LOCAL CURRENCY SENIOR SECURED DEBT

The long-term rating assigned to DeltaCredit Bank's local
currency debt, which benefits from an explicit and irrevocable
guarantee issued by SocGen, is based on the standalone credit
assessment of its guarantor. Accordingly, the downgrade of
DeltaCredit Bank's senior secured debt to Baa2, with a stable
outlook, from Baa1, reflects the lowering of the guarantor's
standalone credit assessment to baa2, from baa1 previously.

LIST OF AFFECTED RATINGS

  Issuer: Komercni Banka, a.s.

   Long-term local and foreign-currency deposit ratings confirmed
   at A2, with negative outlook

   Short-term local- and foreign-currency deposit ratings of
   Prime-1 confirmed

   Bank financial strength rating downgraded to C-/baa1 from
   C/a3, with stable outlook

  Issuer: BRD -- Groupe Societe Generale

   Long- and short-term local-currency deposit ratings downgraded
   to Baa3/Prime-3 from Baa2/Prime-2, with negative outlook

   Long- and short-term foreign-currency deposit ratings
   confirmed at Baa3/Prime-3, with negative outlook

   Bank financial strength rating downgraded to D-/ba3 from
   D/ba2, with negative outlook

  Issuer: Rosbank

   - Local and foreign currency deposit ratings downgraded to
   Baa3/Prime-3, with stable outlook, from Baa2/Prime-2

   - Local currency senior unsecured debt rating downgraded to
   Baa3, with stable outlook, from Baa2

   - Standalone BFSR of D/ba2 unchanged, stable outlook

  Issuer: DeltaCredit

   - Long-term local and foreign currency deposit ratings
   downgraded to Baa3, with stable outlook, from Baa2, short-term
   foreign currency deposit rating downgraded to Prime-3 from
   Prime-2

   - Local currency senior secured debt rating downgraded to
   Baa2, with stable outlook, from Baa1

   - Standalone BFSR of D/ba2 unchanged, stable outlook

  Issuer: Rusfinance Bank:

   Local and foreign currency long-term deposit ratings
   downgraded to Ba1 from Baa3; stable outlook

   Local and foreign currency short-term deposit ratings
   downgraded to Not-Prime from Prime-3

   Local currency senior unsecured debt rating downgraded to Ba1
   from Baa3; stable outlook

   Standalone BFSR affirmed at E+/b1, stable outlook

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: Global Methodology, published in March 2012.



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


* SPAIN: Moody's Downgrades Deposit Ratings of 28 Banks
-------------------------------------------------------
Moody's Investors Service has downgraded by one to four notches
the long-term debt and deposit ratings for 28 Spanish banks and
two issuer ratings.

The actions follow the weakening of the Spanish government's
creditworthiness, as captured by Moody's downgrade of Spain's
government bond ratings to Baa3 from A3 on June 13, 2012, and the
initiation of a review for further downgrade.

Moody's adds that the downgrades of the long-term debt and
deposit ratings also reflect the lowering of most of these banks'
standalone credit assessments.

The debt and deposit ratings declined by one notch for three
banks, by two notches for 11 banks, by three notches for ten
banks and by four notches for six banks. The short-term ratings
for 19 banks have also been downgraded between one and two
notches, triggered by the long-term ratings changes.

The actions reflect, to various degrees across these banks, two
main drivers:

(i) Moody's assessment of the reduced creditworthiness of the
Spanish sovereign, which not only affects the government's
ability to support the banks, but also weighs on banks'
standalone credit profiles, and

(ii) Moody's expectation that the banks' exposures to commercial
real estate (CRE) will likely cause higher losses, which might
increase the likelihood that these banks will require external
support.

This notwithstanding, Moody's views positively the broad based
support measures being introduced by the Spanish government to
support the Spanish banking system as a whole. Moody's will
assess the impact of the upcoming recapitalization on banks'
creditworthiness and bondholders once the final amount, timing
and form of funds flowing to each individual bank are known.

The ratings of both Banco Santander and Santander Consumer
Finance are one notch higher than the sovereign's rating, due to
the high degree of geographical diversification of their balance
sheet and income sources, and a manageable level of direct
exposure to Spanish sovereign debt relative to their Tier 1
capital, including under stress scenarios. All the rest of the
affected banks' standalone ratings are now at or below Spain's
Baa3 rating.

In addition, Moody's has also downgraded (i) the ratings for
senior subordinated debt and hybrid instruments of affected
entities; (ii) all rated government-backed debt issuances from
Spanish banks; and (iii) the long-term debt ratings of Instituto
de Credito Oficial (ICO), which are based on an unconditional and
irrevocable guarantee from the Spanish Government.

A list of the Affected Credit Ratings is available at:

http://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_143393

RATINGS RATIONALE -- STANDALONE BFSRs

Moody's has downgraded the standalone BFSRs of 25 Spanish banks
out of a total of 33 rated institutions, three BFSRs were
maintained, and five institutions do not have a BFSR assigned to
them.

FIRST DRIVER --- REDUCED CREDITWORTHINESS OF THE SPANISH
SOVEREIGN

Moody's said that the reduced creditworthiness of the Spanish
sovereign, as captured by the agency's three-notch downgrade of
Spain's government bond rating, implies a weaker credit profile
for Spanish banks. This results from the banks' multiple linkages
with the sovereign, including (i) the impact of the government's
financial position on the domestic economy; and (ii) the large
exposures of most banks to their domestic government and to other
counterparties that depend on the credit strength of the
government.

After the rating actions, only the standalone ratings of Banco
Santander and Santander Consumer Finance are higher than Spain's
Baa3 rating in light of their geographical diversification when
measured by lending activities, revenues, and earnings. In
addition, Moody's believes that Banco Santander's Tier 1 capital
ratio would be resilient to applying conservative haircuts to not
only the sovereign exposures but also loans to sub-sovereigns.
Santander Consumer Finance does not hold any domestic government
securities on its books. Moody's believes that the very
diversified portfolios of these entities reduce their direct
linkage to the sovereign risk profile, and they are therefore
rated one notch above the sovereign (see Moody's Sector Comment
"How Sovereign Credit Quality May Affect Other Ratings" published
13 February, 2012).

SECOND DRIVER --- BANKS' CREDIT PROFILES VULNERABLE TO HIGHER
LOSS ASSUMPTIONS, PARTICULARLY ON COMMERCIAL REAL ESTATE
EXPOSURES

Several Spanish banks' balance-sheet clean-up exercises have
illustrated the difficulties involved with establishing credible
CRE asset valuations, because of the lack of market liquidity.
Furthermore, the required extended period of fiscal
consolidation, both at central and regional government levels, is
likely to maintain negative pressure on banks' balance sheets. As
such, Moody's stressed loss assumptions on the banks' CRE
exposures as well as its other credit exposures now anticipate
outcomes ranging from its more adverse scenario to more highly
stressed scenarios typical of countries that have experienced
severe market disruptions in their CRE sectors (e.g., Ireland).
Many banks don't have sufficient shock absorbers (earnings and
capital) to withstand such potential stresses. The downgrade of
the banks' standalone credit assessments and their new levels
mostly in sub-investment grade directly reflect the banks'
relative vulnerability in such a stress scenario as well as the
heightened likelihood that they may need further external
support.

Nevertheless, Moody's views positively the Spanish government's
efforts to stabilize the entire banking system as well as Bankia
(Ba2, b2, all ratings under review with uncertain direction),
which have culminated with the announcement made on 9 June to
seek financial assistance from euro area Member States of up to
EUR 100 billion to recapitalize Spanish banks. The support will
be provided by the EFSF or ESM in the form of a loan granted to
the FROB. This amount is intended to cover the capital needs that
will be revealed by the two valuation processes currently
underway plus an additional "safety margin". The Spanish
government has not revealed yet the amount that will be finally
requested and individual capital needs will be made public once
the last phase of the valuation is completed.

Moody's will assess the impact of such support on banks'
creditworthiness and on bondholders - including the
conditionalities that are likely to be imposed on restructured or
recapitalized banks along the EU framework for banks' bailouts --
once the amount, timing and form of funds flowing to each
individual bank are known. Moody's will also assess to what
extent the funding of Spanish government debt by the banks may be
curbed to reduce the risk of contagion between the banks and the
government.

With regards to Bankia, the b2 standalone credit assessment and
the three notch uplift for its debt and deposit ratings to Ba2
incorporate the expectation of significant capital inflows along
the lines of the government's announcements dated 25 May 2012; at
the same time, the ratings reflect, among considerations, the
uncertainty about the exact form of the capital injection, as
well as the conditionalities that may be imposed by the EU in
return for the receipt of state aid.

For the three other banks that are currently under administration
of the FROB, NCG Banco and Catalunya Banc (both rated B1/b2/Not
Prime) and Banco de Valencia (B3/caa1), in Moody's view these
banks may be the most likely next recipients of further capital
in addition to any capital they have already received. However,
since the FROB's approach up to now had been to sell these banks
via auction processes, there is no clarity yet about any further
capital injections in the event that these auctions are not
successful. Therefore, the ratings do not yet reflect the
potential for further capital injections.

A primary driver of the rating actions on CECA, Banco Cooperativo
Espanol and Ahorro Corporacion is the rating adjustment applied
to their main counterparts (i.e., Spanish savings banks and rural
credit cooperatives).

Moody's has maintained the standalone ratings of Banco Pastor and
Banco CAM at current levels, based on the fact that these banks
are already fully-owned by Banco Popular and Banco Sabadell,
respectively, and that they will cease to exist as independent
legal entities by year-end 2012.

Furthermore, in the specific case of Banco Sabadell, which has
recently acquired Banco CAM, Moody's has factored in the more
ample risk-absorption capacity of the combined entity as a
consequence of the acquisition and the way it was structured,
which has limited the magnitude of the downgrade of Banco
Sabadell's standalone BFSR.

The review status and outlooks of the standalone BFSRs of 28
affected banks are as follows:

-- 16 standalone ratings remain on review for downgrade
reflecting the continuing review for downgrade of the Spanish
government's Baa3 bond rating.

-- The ratings of nine institutions that are involved in merger
transactions are also on review, as Moody's continues to assess
the impact of such transactions on their credit profiles. This
explains the review status of CaixaBank, Unicaja and Banco Ceiss,
Banco Popular and Banco Pastor, Banco Sabadell and Banco CAM, and
Ibercaja Banco and Liberbank. In all these cases, the standalone
ratings are on review for downgrade, with the exception of those
of Banco CEISS (E+/b2) and Banco CAM (E+/b3) that are on review
with direction uncertain. These review placements reflect the
likelihood that the rating of the resultant combined entity might
be higher than their current ratings.

-- Bankia's (E+/b2) standalone ratings remain on review with
direction uncertain, given the uncertainties regarding the impact
on its credit profile of any conditionality that may accompany
its' recapitalization, the terms and conditions of instruments
that will be used to recapitalize the bank, and the precise
timing of its recapitalization.

-- The remaining two banks (Banco de Valencia and Dexia
Sabadell) have stable outlooks assigned to their E BFSRs.
However, the corresponding standalone credit assessments could
face some pressure to be remapped to a lower level within the E
BFSR category from the current caa1 level.

RATINGS RATIONALE -- SENIOR DEBT RATINGS

The downgrades of 28 debt and deposit ratings reflect both (i)
Moody's assessment that the ability of the Spanish government to
provide future support to Spanish banks has declined; and (ii)
the banks' reduced standalone credit profiles. The downgrades of
19 banks' short-term ratings followed the downgrades of their
long-term ratings, consistent with Moody's standard mapping of
short-term to long-term ratings.

Moody's has also lowered its systemic support assessment for NCG
Banco, Catalunya Banco and Banco de Valencia to levels that are
consistent with their nationwide market shares, in line with the
criteria applied to the rest of the banking system as per Moody's
methodology (see "Incorporation of Joint-Default Analysis into
Moody's Bank Ratings: Global Methodology" published on 30 March,
2012).

Moody's had increased the uplift factored into the senior debt
ratings of these three banks as a result of their ownership by
FROB (Fondo de Restructuracion Ordenada Bancaria). These banks
were intended to benefit from an Asset Protection Scheme by the
Deposit Guarantee Fund -- which is funded by annual contributions
from member banks. However, Moody's assigns a very low
probability to the completion of a swift auction process, given
the system-wide pressures and the uncertainties regarding the
size, terms and schedule of the recapitalization of the system by
the EFSF or ESM.

Furthermore, Moody's has downgraded the issuer ratings of La
Caixa and Banco Financiero y de Ahorro (BFA), triggered by the
downgrade of the debt ratings of their operating companies,
CaixaBank and Bankia, respectively. The issuer ratings of La
Caixa and BFA are positioned two and three notches, respectively,
below the long-term ratings of their operating companies. The
issuer rating of La Caixa is on review for downgrade, whilst
BFA's is on review direction uncertain. Both outlooks reflect the
outlooks on their operating companies' ratings.

Moody's has maintained the debt and deposit ratings of three
entities at their current levels (Banco Pastor, Banco CAM and
Lico Leasing). The debt ratings of Banco Pastor and Banco CAM
incorporate their full ownership by Banco Popular and Banco
Sabadell, respectively, and Moody's expectation that their debt
will be legally assumed by their owners during the current year
as they will cease to exist as independent legal entities. To
reflect this situation, Moody's has assigned a very high
probability of parental support to these banks' debt ratings.

The review status and outlooks on the debt and deposit ratings of
33 publicly rated institutions are as follows:

-- 30 are on review for downgrade, reflecting the review for
downgrade of the Spanish government's Baa3 bond rating and the
review for downgrade on the banks' standalone BFSRs.

-- The debt and deposit ratings of Banco CEISS and Bankia are on
review with direction uncertain, reflecting the review with
direction uncertain of these banks' standalone BFSRs.

-- The issuer rating of BFA is on review with direction
uncertain reflecting the review with direction uncertain of
Bankia's standalone BFSR

RATINGS RATIONALE -- SENIOR SUBORDINATED DEBT AND HYBRID
INSTRUMENTS

Moody's has downgraded the senior subordinated debt and hybrid
ratings of 24 Spanish banks in line with the lowering of their
standalone credit assessments. Moody's had previously removed
government support assumptions from its ratings of subordinated
debt and hybrid instruments of Spanish banks on December 12,
2011.

RATINGS RATIONALE -- GOVERNMENT-GUARANTEED DEBT

Following the downgrade of the Spanish government's bond rating,
Moody's has also downgraded to Baa3, on review for downgrade,
from A3, and with a negative outlook the backed senior debt of 17
institutions. The backed-Baa3 ratings assigned are based on the
unconditional guarantee, which directly links these ratings to
the Spanish government.

RATINGS RATIONALE -- THE DOWNGRADE OF ICO's RATINGS

Moody's has downgraded to Baa3, on review for downgrade, from A3
(negative outlook) all of ICO's rated debt. Since ICO's
liabilities are explicitly, irrevocably, directly and
unconditionally guaranteed by the government of Spain, the rating
action on ICO is triggered by the three-notch downgrade of the
sovereign's ratings.

WHAT COULD MOVE THE RATINGS UP/DOWN

Downward pressure on Spanish banks' ratings primarily arises from
the current review for downgrade process of the Spanish sovereign
rating, given the negative implications of the weaker
creditworthiness of the sovereign on banks' credit risk profiles.
Further downward pressure on the banks' ratings might in addition
develop if (i) operating conditions worsen beyond Moody's current
expectations; (ii) asset-quality deterioration exceeds Moody's
current expectations; and/or (iii) pressures on market-funding
intensify.

Upward pressure on the ratings may arise upon the implementation
of the government's plan to stabilize the banking system, to the
extent that banks' resilience to the challenging prevailing
conditions improve. Likewise, any improvement in the standalone
strength of banks arising from stronger earnings, improved
funding conditions or the work-out of asset-quality challenges
could result in rating upgrades.

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.



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


CINRAM INT'L: Files for Bankruptcy in Canada & US to Sell Biz
-------------------------------------------------------------
Cinram International Inc. reached an agreement to sell
substantially all of its assets and operations to Najafi
Companies for $82.5 million.

To implement sale transactions, the Company has filed for
reorganization protection under the Companies' Creditors
Arrangements Act (Canada) in the Ontario Superior Court.
Concurrently with that filing, Cinram's US subsidiaries filed
under Chapter 15 of the United States Bankruptcy Code (Bankr. D.
Del. Case Nos. 12-11882 to 12-11890).

The filings were made to give effect to the sale of the Company's
businesses and assets to Najafi Companies and to preserve
Cinram's operations and services to its customers while the sale
is finalized.

                       $82.5 Million Sale

Cinram International is selling the business for $82.5 million to
Najafi Cos. LLC from Phoenix.

The sale transaction includes these key elements:

    * Najafi will purchase substantially all the manufacture of
pre-recorded multimedia products and the provision of related
logistics services, digital media solutions and outsourced vendor
management inventory services in North America and substantially
all of the European business.

    * The sale transaction is subject to customary conditions,
including receipt of approval under the Investment Canada Act and
completion of other regulatory processes, and receipt of any
other requisite approvals, in North America and Europe.

    * Najafi will continue to fulfill Cinram's obligations to its
customers and suppliers in respect of any of the acquired assets
or business.

   * The sale transaction is expected to close by early August,
2012, although the transfer of portions of the business may occur
later in the year.

Assets excluded from the sale transaction include the assets used
in Cinram's telecommunications products logistics services and
certain real estate assets.

The proceeds of the sale transaction, and proceeds generated from
the excluded assets, will be used to repay Cinram's senior
creditors (and will not be available for distribution to
unitholders).

The sale transaction has the support of members of the steering
committee of lenders under Cinram's senior secured credit
facilities, representing 40% of the loans under the first lien
facilities.

"Cinram is a market leader in its industries with a long track
record of best in class performance," said Jahm Najafi, CEO,
Najafi Companies.  "We look forward to a seamless transition for
our customers, and to build on Cinram's significant base of
strengths and expertise."

Moelis & Company acted as financial advisor to Cinram.

                       Road to Bankruptcy

Cinram said in a court filing that following the economic
downturn in its primary markets of North America and Europe,
which impacted consumers' discretionary spending and adversely
affected the industry, Cinram has experienced significant
declines in revenue and EBITDA.

Over the past several years, Cinram has continued to evaluate its
strategic alternatives and to rationalize its operating footprint
in order to attempt to balance its ongoing operations and
financial challenges with its existing debt levels.  In September
2011, Cinram engaged MOelis and Company LLC to assist in the
review of strategic alternatives.

Despite cost-reduction and recapitalization initiatives and the
implementation of a variety of restructuring alternatives, the
Cinram Group has been experiencing a number of challenges that
have led to its seeking the protections provided by the CCAA.

Waivers from lenders were set to expire June 30.  Cinram says
that without additional funding, it will exhaust available cash
resources and will thus be unable to meet its obligations as they
come due.

As of March 31, 2012, there was $233 million outstanding under a
first lien term loan facility, $19 million under a first lien
revolving credit facility, $12 million of letter of credit
exposure, and $12 million outstanding under a second lien credit
agreement.

                        Ontario Proceeding

The primary bankruptcy is in Ontario under Canada's Companies'
Creditors Arrangement Act.

On June 25, 2012, Cinram International Inc., Cinram International
Income Fund, CII Trust and subsidiaries obtained an Initial Order
under the Companies' Creditors Arrangement Act.  The Applicants
were granted a stay of proceedings and other relief provided
under the CCAA, which was extended to Cinram International
Limited Partnership.

Pursuant to the Initial Order, FTI Consulting Canada Inc. has
been appointed Monitor.  See
http://cfcanada.fticonsulting.com/cinram/

The Monitor can be reached at:

         FTI CONSULTING
         TD Waterhouse Tower
         79 Wellington Street West
         Suite 2010, P.O. Box 104
         Toronto, Ontario M5K 1G8
         Pamela Luthra
         E-mail: Cinram@fticonsulting.com
         Toll Free: 1-855-718-5255
         Local: 416-649-8096

Lawyers for Cinram in the CCAA case are:

         Robert J Chadwick, Esq.
         Melaney J. Wagner, Esq.
         Caroline Descours, Esq.
         GOODSMAN LLP
         Barristers & Solicitors
         333 Bay Street, Suite 3400
         Toronto, Canada M5H 2S7
         Tel: (416) 979-2211
         Fax: (416) 979-1234

                         Chapter 15 Case

Cinram and its affiliates have commenced proceeding under Chapter
15 in Delaware to ensure that they are protection from creditor
actions in the U.S. and to assist with the global implementation
of the sale.

Cinram wants the Delaware court to rule that Canada is home to
the "foreign main proceeding."  Cinram explains that although it
has operations in the United States and certain units are
incorporated under the laws of the United States, Ontario, Canada
is Cinram's home jurisdiction and the nerve centre of Cinram's
management, business and operations.

                      Proceedings in France

Cinram's European entities are not part of the Ontario proceeding
and it is not intended that any insolvency proceedings will be
commenced with respect to Cinram's European entities, except for
Cinram Optical Discs S.A.S., which has commenced insolvency
proceedings in France.

                         DIP Financing

The court restructuring process is not expected to affect
Cinram's day-to-day operations.  Cinram has access to the funding
necessary to maintain its operations and the operations will
continue without disruption during this period.  Cinram will
operate its business in the ordinary course, including continuing
to pay its suppliers for all goods and services through the
course of the court restructuring process.

The Ontario Court has entered an order authorizing Cinram to
obtain and borrow under a credit facility from JP Morgan Chase
Bank N.A., as administrative agent, and lender and certain other
lenders.  The loans will finance Cinrma's workin capital
requirements and other general corporate purposes and
expenditures.  The order provides that borrowing under the
facility will not exceed $15 million.

                       Retention Payments

Cinram says it has developed a key employee retention program
with the principal purpose of providing an incentive for eligible
employees, including eligible officers, to remain with the Cinram
Group despite the financial difficulties that the Cinram Group is
currently facing.

The KERP includes retention payments to certain existing
employees, including certain officers, employed at Canadian and
U.S. entities that are critical to the preservation of Cinram's
enterprise value as well as payments to Cinram's CEO and the CFO
in connection with a sale transaction or capital transaction

In connection with the transition of Cinram Distribution's Aurora
facility to its Nashville facility, Cinram entered into retention
agreements with five key employees critical for the orderly
closure of the Aurora facility and transition of its distribution
business to the Nashville facility, pursuant to which each
Aurora Employee is eligible to obtain a specified retention
payment.

                    About Cinram International

With headquarters in Toronto, Ontario, Canada, Cinram
International Inc. is one of the world's largest independent
manufacturers, replicators and distributors of DVDs and audio
CDs.

The balance sheet at the end of 2011 showed total assets of
$452.7 million and liabilities of $527.8 million, including
$148.8 million in accounts payable.  JPMorgan Chase Bank NA is
agent for first-lien lenders.

In April 2012, Standard & Poor's Ratings Services lowered its
ratings on Cinram International Inc., including its long-term
corporate credit rating on the company to 'CC' from 'CCC'.  S&P
also revised the recovery rating on the company's senior
secured debt to '5' from '4' given its opinion of a lower
emergence valuation for Cinram compared with its previous
expectations due to the company's poor performance, which it
expects will continue. The '5' recovery rating indicates S&P's
expectation of modest (10%-30%) recovery in a default situation,
in contrast to a '4' recovery rating, which indicates its opinion
of average (30%-50%) recovery. The recovery rating on the first-
out senior secured revolving credit facility is unchanged at '1',
indicating very high (90%-100%) recovery in default.

In February 2012, Moody's Investors Service downgraded Cinram
International's corporate family rating (CFR) and probability of
default ratings (PDR) to Caa3 from Caa1 and Caa2 respectively. At
the same time, Cinram's speculative grade liquidity rating was
downgraded to SGL-4 (poor) from SGL-3 (adequate), and the ratings
outlook was revised to negative from stable.  Moody's rating
action was prompted by the combination of continued technological
substitution and resulting ongoing weak results and poor forward
earnings visibility, together with the company's near total
reliance on bank lenders for external capital. With the market
value of the company's equity having declined to just over US$11
million, it appears that Cinram has no access to alternative
sources of capital and with weak free cash flow generation, the
company's ability to reinvent itself is quite limited. This
increases the potential of lenders incurring losses as Cinram, a
replicator and distributor of CD's and DVD's (a business that is
experiencing precipitous declines), looks to reposition its
business activities.


LEHMAN BROTHERS: UK Units Could Be Forced to Back Pension Scheme
----------------------------------------------------------------
Lehman Brothers Holdings Inc.'s UK subsidiaries could be forced
to provide financial support to the company's underfunded pension
scheme following a tribunal's ruling that trustees of the scheme
were entitled to raise an action, according to a June 21 report
by Out-Law.com.

The pensions regulator had previously decided to issue a
financial support direction against only six companies within the
Lehman group, and did not pursue the remaining 38 possible
targets.  Lehman's pension scheme had a deficit of GBP121 million
as of its 2008 valuation, Out-Law.com reported.

In its decision, the Upper Tribunal tax and chancery chamber said
the six companies and the trustees were legally entitled to
appeal the regulator's decision not to impose an FSD as they were
"directly affected" by the decision.

The tribunal also said the two-year time limit under which the
regulator had to issue an FSD against the companies only applied
to its own administration process and so did not apply in this
case.  That time limit expired in September 2010.

"The trustees have a clear duty to monitor the financial position
of the scheme in order to come to a view as to whether its assets
are sufficient to meet the members' current and future
entitlements," the tribunal judges said.

A spokesperson for the pensions regulator said the tribunal has
found that trustees are "directly affected parties" and are
therefore able to refer decisions of the pensions regulator to
the tribunal, Out-Law.com reported.

"We welcome the clarification to this complex area of law," Out-
Law.com quoted the spokesperson as saying.

                      About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States.  For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.

Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555).  Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history.  Several other affiliates followed
thereafter.

Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.

The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman.  Epiq
Bankruptcy Solutions serves as claims and noticing agent.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)).  James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.

The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion.  Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees.  Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.

Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history.  Lehman is set to make its first payment to creditors
under its US$65 billion payout plan on April 17, 2012.

               International Operations Collapse

Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd.  Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008.  The joint
administrators have been appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16.  Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.

Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates.  (http://bankrupt.com/newsstand/or 215/945-700)


LEHMAN BROTHERS: E&Y Cleared by UK Regulators Over Reports
----------------------------------------------------------
The Accountancy and Actuarial Discipline Board (AADB), an
operating Board of the Financial Reporting Council, announces the
outcome of its investigation into the conduct of Members of the
ICAEW and of Ernst & Young LLP, Member Firm of the ICAEW, as
auditors to Lehman Brothers International (Europe).

The AADB is independent of the professions it disciplines and
operates in the public interest.

Following the conclusion of the investigation, the AADB's
Executive Counsel, Gareth Rees QC, has decided that no action
should be taken against Ernst & Young LLP or any individuals in
connection with their conduct in this matter.

Executive Counsel's summary of the investigation and his
conclusions are set out below.

    * On June 10, 2010, the Accountancy and Actuarial Discipline
      Board considered the matter of Lehman Brothers and
      decided, pursuant to paragraph 5(8) of the AADB
      Accountancy Scheme, that the matter should be investigated
      by the AADB.

    * Lehman Brothers Holdings Inc. sought Chapter 11 protection
      in the United States of America on 15th September 2008.
      The US Bankruptcy Court nominated an Examiner, Anton R.
      Valukas, who published his report into Lehman's collapse
      on 11th March 2010.  The report made criticisms of
      Lehmans' auditor, Ernst & Young, for failing to question
      and challenge improper or inadequate disclosures in
      Lehmans' financial statements.  The Examiner's criticisms
      specifically related to the use by Lehmans of transactions
      known as Repo 105 and Repo 108 transactions.  The report
      did not specify whether the criticisms related to the
      primary auditor of LBHI, which was Ernst & Young in New
      York, or Ernst & Young generally.

    * Repo 105s and Repo 108s were used by Lehmans to raise
      short term funds and, by virtue of compliance with US
      Financial Accounting Standard 140 which requires certain
      transactions to be treated as sales instead of financing
      transactions, enabled Lehman to reduce its balance sheet
      and leverage ratios.  The Examiner found that whilst the
      use of Repo 105/ 108 transactions may not have been
      inherently improper its sole function as employed by
      Lehman was balance sheet manipulation.

    * The scope of the AADB investigation was:

      "The conduct of Members and a Member Firm in relation to:
      (a) the preparation and audits of the financial statements
      of Lehman Brothers Holdings Inc. and UK operations
      including Lehman Brothers International (Europe) for the
      year ended 30th November 2007;and (b) the use and
      accounting treatment of transactions known as "Repo 105s"
      and "Repo 108s" by Lehman Brothers Holdings Inc. and UK
      operations including Lehman Brothers International
      (Europe)."

    * The focus of the investigation was the audit by Ernst &
      Young LLP in the UK of Lehman Brothers International
      (Europe) and of Repo 105 and Repo 108 transactions which
      were conducted through LBIE.  EYUK audited the trial
      balance of LBIE prepared under US GAAP for consolidation
      into LBHI's consolidated financial statements. The audit
      of LBIE's trial balance formed the basis of a 'Specific
      Scope Conclusion' to Ernst & Young in New York.

    * In the course of the investigation, the investigation team
      obtained and reviewed EYUK's audit files; hard copy
      documentation; information from EYUK staff members'
      laptops and emails, and information from other regulators.
      The team also interviewed EYUK audit team staff and former
      members of staff of Lehman.

    * Executive Counsel considers that there is no realistic
      prospect that a Tribunal would make an adverse finding
      against Ernst & Young LLP in the UK or Members within that
      firm.  The investigation will therefore be closed and no
      further action taken.

                   About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States.  For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.

Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555).  Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history.  Several other affiliates followed
thereafter.

Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.

The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman.  Epiq
Bankruptcy Solutions serves as claims and noticing agent.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.

On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)).  James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.

The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion.  Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees.  Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.

Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history.  Lehman is set to make its first payment to creditors
under its US$65 billion payout plan on April 17, 2012.

               International Operations Collapse

Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd.  Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008.  The joint
administrators have been appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16.  Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.

Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates.  (http://bankrupt.com/newsstand/or 215/945-700)


NORTEL NETWORKS: UK Pension Regulators Can't Appeal
---------------------------------------------------
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that U.K. pension regulators for a European branch of
Nortel Networks Inc. won't be permitted to appeal to the U.S.
Supreme Court from an opinion in December by the U.S. Court of
Appeals in Philadelphia blocking the foreign regulators from
deciding whether Nortel owes $3.1 billion on underfunded pension
plans.

The report recounts that the trustee for Nortel's U.K. pension
plan filed a claim in the U.S. bankruptcy court saying the
company could be liable for as much as $3.1 billion in
underfunding. Later, the pension trustee began proceedings in the
U.K. that could have resulted in orders requiring further
contributions to the pension plan.  Nortel notched the first
victory when the bankruptcy judge halted the U.K. proceedings for
being in violation of Section 362 of the U.S. Bankruptcy Code,
which automatically stops actions by creditors outside bankruptcy
court. The U.K. pension administrators lost again on appeal to
the district court and sustained a third loss on Dec. 29 in the
appeals court.  The appeals court in Philadelphia concluded that
the U.K. pension proceedings didn't fit within the exception to
the automatic stay allowing governmental police or regulatory
actions to go forward regardless of bankruptcy. The court also
ruled that neither the pension trustee nor the U.K. Board of the
Pension Protection Fund was a "governmental unit" and thus
couldn't take advantage of the police and regulatory exception.

Mr. Rochelle relates that on June 25, the Supreme Court decided
not to allow a further appeal.

Mr. Rochelle notes that Nortel's victory has practical
significance by removing a threat that foreign courts could
determine major liabilities in the U.S. bankruptcy.  The ruling
from the Supreme Court also gives greater stature to the appeals
court's opinion about the primacy of the U.S. automatic stay over
proceedings abroad.

The case in the Supreme Court is Trustees of Nortel Networks U.K.
Pension Plan v. Nortel Networks Inc., 11-1271, U.S. Supreme Court
(Washington). The opinion in the circuit court is Trustees of
Nortel Networks U.K. Pension Plan v. Nortel Networks Inc. (In re
Nortel Networks Inc.), 11-1895, 3rd U.S. Circuit Court of Appeals
(Philadelphia). The ruling by the district judge is Trustees of
Nortel Networks U.K. Pension Plan v. Nortel Networks Inc. (In re
Nortel Networks Inc.), 10-230, U.S. District Court, District of
Delaware (Wilmington).  The opinion by the magistrate judge is
Trustees of Nortel Networks U.K. Pension Plan v. Nortel Networks
Inc. (In re Nortel Networks Inc.), 10-230, in the same court.

                     About Nortel Networks

Nortel Networks Inc. and 14 affiliates filed separate Chapter 11
petitions (Bankr. D. Del. Case No. 09-10138) on Jan. 14, 2009.
Judge Kevin Gross presides over the case.  James L. Bromley,
Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York,
serves as general bankruptcy counsel; Derek C. Abbott, Esq., at
Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as
Delaware counsel.  The Chapter 11 Debtors' other professionals
are Lazard Freres & Co. LLC as financial advisors; and Epiq
Bankruptcy Solutions LLC as claims and notice agent.

The Office of the United States Trustee for the District of
Delaware has appointed an Official Committee of Unsecured
Creditors in respect of the Debtors, and an ad hoc group of
bondholders has been organized.

Fred S. Hodara, Esq., at Akin Gump Strauss Hauer & Feld LLP, in
New York, and Christopher M. Samis, Esq., at Richards, Layton &
Finger, P.A., in Wilmington, Delaware, represent the Official
Committee of Unsecured Creditors.

The Official Committee of Retired Employees and the Official
Committee of Long-Term Disability Participants tapped Alvarez &
Marsal Healthcare Industry Group as financial advisor.  The
Retiree Committee is represented by McCarter & English LLP as
Delaware counsel, and Togut Segal & Segal serves as the Retiree
Committee.  The Committee retained Alvarez & Marsal Healthcare
Industry Group as financial advisor, and Kurtzman Carson
Consultants LLC as its communications agent.

Certain of Nortel's European subsidiaries also made consequential
filings for creditor protection.  On May 28, 2009, at the request
of the Administrators, the Commercial Court of Versailles, France
ordered the commencement of secondary proceedings in respect of
Nortel Networks S.A.  On June 8, 2009, Nortel Networks UK Limited
filed petitions in this Court for recognition of the English
Proceedings as foreign main proceedings under chapter 15 of the
Bankruptcy Code.

Nortel has collected almost $9 billion for distribution to
creditors. Of the total, US$4.5 billion came from the sale of
Nortel's patent portfolio to Rockstar Bidco, a consortium
consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM
Ericsson, Microsoft Corp., Research In Motion Limited, and Sony
Corporation.  The consortium defeated a $900 million stalking
horse bid by Google Inc. at an auction.  The deal closed in July
2011.

Nortel Networks has filed a proposed plan of liquidation in the
U.S. Bankruptcy Court.  The Plan generally provides for full
payment on secured claims with other distributions going in
accordance with the priorities in bankruptcy law.


SOUTH LONDON: Put Into Administration; Job Cuts Likely
------------------------------------------------------
Oliver Wright at The Independent reports that South London
Healthcare NHS Trust, which was losing GBP1 million a week, on
Monday became the first in the country to be put under the
control of a special administrator tasked with putting it on a
viable footing.

The trust is likely to face severe cuts to services and jobs in
an attempt to reduce costs, the Independent says.

According to the Independent, Department Health sources suggested
the other hospitals could follow South London into administration
and face similar cutbacks.

They are believe to include at least three more hospital trusts
in London: West Middlesex University Hospital Trust, Barking,
Havering & Redbridge Hospitals University NHS Trust and Barnet &
Chase Farm Hospitals NHS Trust, the Independent discloses.

Barking has received a total of GBP140 million in bailouts in the
past five years, including GBP30 million in 2010-11, the
Independent notes.

South London Healthcare NHS Trust runs Queen Mary's Hospital in
Sidcup, the Queen Elizabeth Hospital in Woolwich and the Princess
Royal University Hospital in Bromley



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


* Moody's: EU Transport Infrastructure Sector Has Neg. Outlook
--------------------------------------------------------------
The uncertain economic outlook for Europe in 2012, declining
sovereign credit quality and negative traffic growth in
peripheral EU countries is adversely affecting the European
transport infrastructure sector, says Moody's Investors Service
in a Special Comment published on June 25. As a result Moody's
outlook for the sector over the next 12-18 months is negative.

The new report, "European Transport Infrastructure Industry
Outlook -- June 2012", is now available on www.moodys.com.
Moody's subscribers can access this report via the link provided
at the end of this press release.

"If government credit quality declines further in certain
countries, the effect may be sufficient as to have a negative
impact on the credit quality and hence ratings of transport
infrastructure companies located in those countries, says Andrew
Blease, Moody's Analyst and author of the report. "This is
especially the case if the decline is accompanied by a deeper
credit contraction due to funding stress and policy induced
banking system deleveraging," adds Mr. Blease.

However, Moody's expects a divergence of experience, with
companies located in northern Europe likely to experience some
weakness, although traffic developments in the airport sector
there should remain positive. In contrast, companies located in
peripheral EU countries are likely to see traffic declines, given
the negative effect of austerity measures on the economy and
constrained financial markets.

In addition, Moody's believes declining bank credit quality will
continue to make bank loan availability scarcer, more expensive
and only available on more restricted terms. This will adversely
affect companies in EU peripheral countries in particular, but
will also introduce additional risks for users of swaps due to
declining counterparty credit quality, while the increasing use
of break clauses will create additional liquidity risks.

Nevertheless, capital and banking markets will remain open to
transport infrastructure companies, particularly the largest and
most established companies. These generally robust credit
characteristics should continue enabling borrowers to access
markets at good yields relative to other market participants.
Furthermore, Moody's anticipates an increase in new capital
markets issuers as maturing bank loan financed companies seek to
refinance in the capital markets.


                            *********

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

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

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

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


                            *********


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

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland
USA.  Valerie U. Pascual, Marites O. Claro, Rousel Elaine T.
Fernandez, Joy A. Agravante, 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.


                 * * * End of Transmission * * *