TCREUR_Public/120921.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

          Friday, September 21, 2012, Vol. 13, No. 189

                            Headlines



A U S T R I A

VOLKSBANKEN VERBUND: Fitch Affirms 'bb-' Viability Rating


A Z E R B A I J A N

PASHA BANK: Fitch Assigns 'B+' Long-Term Issuer Default Rating


C Z E C H   R E P U B L I C

CSA CZECH: European Union Approves Government Restructuring Aid


F R A N C E

PEUGEOT SA: Fitch Downgrades Senior Unsecured Rating to 'BB-'
RENAULT SA: Fitch Affirms 'BB+' Rating on Sr. Unsecured Notes


G E R M A N Y

FRESENIUS SE: S&P Affirms 'BB+' LT Corporate Credit Rating
PROVIDE BLUE 2005-2: S&P Lowers Rating on Class E Notes to 'B-'
PROVIDE-VR 2004-1: S&P Affirms 'BB+' Rating on Class D Notes
XELLA INTERNATIONAL: Moody's Affirms 'Ba3' CFR; Outlook Negative


H U N G A R Y

* HUNGARY: Corporation Liquidations Up 28% in 12 Months Ended Aug


I R E L A N D

MCCABE BUILDERS: KMPG Appointed as Liquidator
* IRELAND: Moody's Says Neg. Equity Key Driver of RMBS Default
* IRELAND: Moody's Says RMBS Performance Deteriorates in July


I T A L Y

FIAT SPA: Fitch Affirms 'BB' Long-Term Issuer Default Rating


K A Z A K H S T A N

ATF BANK: Fitch Rates US$100-Mil. Subordinate Notes at 'BB-'
BTA BANK: Ukrainian Court Recognizes Restructuring Proceedings


L U X E M B O U R G

INTELSAT JACKSON: Moody's Rates US$640MM Sr. Unsec. Notes Caa2


N E T H E R L A N D S

EURO-GALAXY II: S&P Lowers Rating on Class E Notes to 'CCC+'
GRESHAM CAPITAL III: S&P Raises Rating on Class E Notes to 'BB-'
NIELSEN HOLDINGS: Moody's Rates US$800MM Sr. Unsecured Notes 'B2'
PLAZA CENTERS: S&P Assigns 'B' Long-Term Corp. Credit Rating
RHODIUM 1: S&P Cuts Rating on Class D Notes to 'CCC-'

UPC HOLDING: Moody's Assigns 'B2' Rating to EUR600MM Sr. Notes
WOOD STREET IV: S&P Raises Rating on Class D Notes to 'BB+'
ZOO ABS II: S&P Lowers Rating on Class E Notes to 'CCC'


R U S S I A

KRAYINVESTBANK: Fitch Affirms 'B+' Issuer Default Rating
* SMOLENSK REGION: Fitch Assigns 'B+/B' Currency Ratings


S P A I N

FRUMOLY: Goes Into Liquidation
OPDE US: Unit of Spanish Solar Firms Files for Chapter 7
TDA IBERCAJA: S&P Affirms 'D' Rating on Class B Notes


S W I T Z E R L A N D

SCHMOLZ BICKENBACH: S&P Lowers Corporate Credit Rating to 'B'


U K R A I N E

PJSC BANK: Fitch Junks Long-Term Issuer Default Rating


U N I T E D   K I N G D O M

HAWTHORNES OF NOTTINGHAM: Faces Creditors' Voluntary Liquidation
IA GLOBAL: UK Administrators Hand Back 2.4 Million Common Shares


X X X X X X X X

* Moody's Says Negative Pressure on EU Corp. Rating to Persist
* BOOK REVIEW: Performance Evaluation of Hedge Funds


                            *********


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A U S T R I A
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VOLKSBANKEN VERBUND: Fitch Affirms 'bb-' Viability Rating
---------------------------------------------------------
Fitch Ratings has affirmed Volksbanken Verbund's (VB-Verbund)
Long-term Issuer Default Rating (IDR) at 'A' with a Stable
Outlook, Short-term IDR at 'F1', Support Rating at '1' and
Support Rating Floor (SRF) at 'A'.  The agency has affirmed VB-
Verbund's Viability Rating (VR) at 'bb-' and removed it from
Rating Watch Negative (RWN).

Fitch has also affirmed VB-Verbund's central institution,
Oesterreichische Volksbanken Aktiengesellschaft AG's (OeVAG)
Long-term IDR at 'A', Short-term IDR at 'F1', Support Rating at
'1' and SRF at 'A'.  The Outlook on the Long-term IDR is Stable.

VB-Verbund, which is not a legal entity itself but a cooperative
grouping of member banks, is Austria's fourth-largest banking
group.  OeVAG is the central institution of VB-Verbund.  As such,
Fitch has assigned OeVAG "group" ratings under Fitch's rating
criteria for banking structures backed by mutual support
mechanisms. Fitch does not assign OeVAG a VR.

Rating Action Rationale

The removal of the RWN on VB-Verbund's VR and its affirmation at
'bb-' reflects Fitch's opinion that VB-Verbund has made progress
in improving OeVAG's risk profile and capitalization in the
context of a comprehensive group restructuring initiated in early
2012.  Although the restructuring is ongoing, VB Verbund has
received regulatory approvals for the new group structure and
Fitch expects the implementation of the new structure to be
completed shortly.  The new group structure, which envisages a
re-focus on VB-Verbund's Austrian core business, a simpler
business model for OeVAG and tighter risk management and
supervision, should in Fitch's view result in the group having a
more sustainable financial profile.

RATING DRIVERS AND SENSITIVITIES - IDRS, SUPPORT RATING AND
SUPPORT RATING FLOOR

VB-Verbund's IDRs, Support Rating and SRF reflect Fitch's view of
an extremely high probability of support for the group from the
Republic of Austria ('AAA'/Stable), if needed.  VB-Verbund will
in Fitch's opinion continue to be a systemically important bank
for the Austrian economy once the group restructuring has been
completed.  Its domestic market share (6.78% and 6.83% domestic
loan and deposit share at end-Q112, respectively) should remain
largely unaffected by OeVAG's ongoing deleveraging as most
disposed assets relate to OeVAG's Central and Eastern European
(CEE) activities.

Fitch assigns the same Support Rating and SRF to OeVAG as to VB-
Verbund to reflect the likelihood that any outside support
provided to the banking group will be channelled through the
central institution.

The Stable Outlook reflects Fitch's view that the probability of
support is likely to remain strong in the short to medium term
under most reasonable scenarios.

The IDRs, Support Rating and SRF are sensitive to developments
within the regulatory and legal framework, either in Austria or
at a pan-European level.  Any changes in the agency's view of
support would result in downgrades of the bank's IDRs, Support
Rating and SRF.  These ratings are also sensitive to any changes
in Fitch's view of the ability of the Austrian authorities to
provide support, which would be signalled by a negative rating
action on Austria's sovereign rating.

RATING DRIVERS AND SENSITIVITIES - VR

VB-Verbund's VR reflects the progress made in repositioning the
group to focus on domestic retail operations.  After a sizeable
loss in 2011, OeVAG returned to profitability in H112 and Fitch
expects profitability to improve further albeit at levels below
those experienced before the crisis.  It disposed of several of
its riskier assets in 2011 and during H112, notably its CEE
operations (excluding VB Romania) and some real estate
activities.  VB-Verbund's asset base is now of acceptable
quality, and lumpy loan and securities impairments observed in
the past are now less likely.  The exception to this is VB
Romania, where asset quality could potentially deteriorate
although restructuring efforts are currently underway.  The
recapitalization of OeVAG should result in improved capital
ratios, and Fitch believes VB-Verbund will consequently have
sufficient capital to carry out the restructuring process without
the need for additional extraordinary capital measures.

VB-Verbund's VR is sensitive to a change in Fitch's assumption
about the viability of the new business model and sustainability
of the bank's financial and risk profile.  Should the
deleveraging process (including its Romanian operations) result
in material losses for the group, then VB-Verbund's VR could be
downgraded.  Additional external capital support measures or
inability to repay government participation and common share
capital over time would also result in a downgrade of the VR.

The VR could be upgraded if the 'new' VB-Verbund successfully
repositions itself to focus primarily on domestic retail
operations whilst avoiding material credit losses.  Clear
sustainable improvements in the group's capital and financial
positions would also be ratings-positive.

AFFILIATED COMPANY RATING DRIVERS AND SENSITIVITIES

The Long- and Short-term IDRs of Wiener Spar- und Kreditinstitut
rGmbH (WSK), one of VB-Verbund's member banks, were maintained on
RWN and simultaneously withdrawn as a result of the
reorganisation of the rated entity.  WSK decided not to
participate in the new mutual support mechanism, and accordingly
no longer benefits from Fitch's Verbund ratings.  As WSK's
ratings have been assigned in the context of Fitch's group rating
methodology, the agency has not performed a standalone assessment
of WSK.  However, given WSK's size any standalone rating would
likely have been several notches lower than VB-Verbund's IDRs.

Fitch will no longer provide analytical coverage of WSK.

The rating actions are as follows:

VB-Verbund

  -- Long-term IDR: affirmed at 'A'; Stable Outlook
  -- Short-term IDR: affirmed at 'F1'
  -- Viability Rating: affirmed at 'bb-'; RWN removed
  -- Support Rating: affirmed at '1'
  -- Support Rating Floor: affirmed at 'A'

OeVAG

  -- Long-term IDR: affirmed at 'A'; Stable Outlook
  -- Short-term IDR: affirmed at 'F1'
  -- Support Rating affirmed at '1'
  -- Support Rating Floor: affirmed at 'A'
  -- Government guaranteed bonds affirmed at 'AAA'
  -- Market Linked Securities: affirmed at 'Aemr'
  -- Senior unsecured notes: affirmed at 'A'/'F1'

Wiener Spar- und Kreditinstitut rGmbH

  -- Long-term IDR: 'A'/RWN maintained; withdrawn
  -- Short-term IDR: 'F1'/RWN maintained; withdrawn

The other VB-Verbund member banks' Long-term IDRs have been
affirmed at 'A' with Stable Outlook and Short-term IDRs at 'F1'.
The full list of VB-Verbund member banks (in addition to OeVAG
and Wiener Spar- und Kreditinstitut rGmbH) is as follows:

Bank fuer Aerzte und freie Berufe AG
Volksbank Weinviertel e.Gen.
VOLKSBANK OBERES WALDVIERTEL rGmbH
Gaertnerbank, rGmbH
Volksbank Tullnerfeld eG
Volksbank Bad Goisern eingetragene Genossenschaft
Volksbank Osttirol rGmbH
Volksbank Oetscherland eG
Volksbank Fels am Wagram e.Gen.
Volksbank Krems-Zwettl AG
Volksbank Laa eGen
Volksbank Marchfeld e.Gen.
Volksbank, Gewerbe- und Handelsbank Kaernten AG
VOLKSBANK fuer den Bezirk Weiz rGmbH
Volksbank Tirol Innsbruck-Schwaz AG
Volksbank Altheim-Braunau rGmbH
Volksbank Feldkirchen, rGmbH
Volksbank Schaerding eG
Volksbank Steirisches Salzkammergut, rGmbH
VOLKSBANK BADEN e.Gen.
VOLKSBANK OBERKAERNTEN rGmbH
VOLKSBANK VOECKLABRUCK-GMUNDEN e.Gen.
Volksbank Wien AG
Volksbank Enns- und Paltental rGmbH
Volksbank Bad Hall e.Gen.
Volksbank Linz-Wels-Muehlviertel AG
Volksbank Gmuend eingetragene Genossenschaft
Allgemeine Bausparkasse rGmbH
Volksbank Alpenvorland e.Gen.
Waldviertler Volksbank Horn rGmbH
Volksbank Ost rGmbH
Volksbank Kufstein eG
Volksbank Ried im Innkreis eG
Volksbank Enns-St. Valentin eG
Volksbank Friedburg rGmbH
Oesterreichische Apothekerbank eG
Volksbank Voecklamarkt-Mondsee rGmbH
Volksbank Gailtal eG
Volksbank Niederoesterreich Sued eG
Volksbank Oberndorf rGmbH
Volksbank Obersdorf-Wolkersdorf-Deutsch-Wagram e.Gen.
VOLKSBANK GRAZ-BRUCK e.Gen.
Volksbank Muerztal-Leoben e.Gen
Volksbank Eferding-Grieskirchen rGmbH
Volksbank fuer die Sued- und Weststeiermark rGmbH
Volksbank Donau-Weinland rGmbH
Volksbank Salzburg eG
Volksbank Almtal e.Gen.
VOLKSBANK VORARLBERG e.Gen.
VOLKSBANK LANDECK eG
Volksbank Aichfeld-Murboden rGmbH
SPARDA-BANK VILLACH/INNSBRUCK rGmbH
Volksbank Kaernten Sued e.Gen.
IMMO-BANK AG
Volksbank Niederoesterreich-Mitte e.G.
Volksbank Sued-Oststeiermark e.Gen.
Volksbank Suedburgenland rGmbH
SPARDA-BANK LINZ rGmbH
VB Factoring Bank AG
Volksbank-Quadrat Bank AG



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A Z E R B A I J A N
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PASHA BANK: Fitch Assigns 'B+' Long-Term Issuer Default Rating
--------------------------------------------------------------
Fitch Ratings has assigned Azerbaijan-based Pasha Bank (PB) a
Long-term Issuer Default Rating (IDR) of 'B+' with a Stable
Outlook.

RATING ACTION RATIONALE: IDRs AND VIABILITY RATING (VR)

PB's IDRs and VR reflect the high-risk Azerbaijan operating
environment; the bank's limited franchise and short track record;
potential contingent risks arising from the construction business
of the broader group; considerable political risk and uncertainty
with respect to the long-term sustainability of the bank's
sizeable related party funding; and significant balance sheet
concentrations.

At the same time, the ratings also consider PB's currently solid
financial metrics, reflected in a sizable capital buffer,
considerable liquidity cushion and reasonable performance.  PB's
credit profile has also benefited to date from the bank's
powerful shareholder in terms of capital injections and access to
funding.

RATING ACTION RATIONALE: SUPPORT RATING AND SUPPORT RATING FLOOR
(SRF)

The '5' Support Rating and 'No Floor' SRF reflect Fitch's view
that support for PB from the Azerbaijan authorities and/or its
owner cannot be relied upon.  This in turn reflects the bank's
still limited systemic importance, the considerable delays in
providing capital support to majority state-owned International
Bank of Azerbaijan ('BB+'/RWN), and PB's potentially high
exposure to any changes in the political landscape in Azerbaijan
(albeit Fitch does not currently expect such changes).

At the same time, Fitch acknowledges that the bank's shareholder
structure may benefit the bank in terms of potential liquidity
support and favorable regulatory treatment. PB is owned by Pasha
Holding and ultimately controlled by Arif Pashaev, the father in-
law of the current President Aliyev.

RATING DRIVERS: IDRs AND VR

Reported loans overdue by 90 days or more (non-performing loans,
NPLs) stood at 10% of the portfolio at end-2011, which is
significant considering recent rapid growth and the relatively
unseasoned nature of the book.  However, NPLs were 90% covered by
loan impairment reserves, and Fitch's review of PB's largest
exposures suggests their quality is reasonable relative to
privately-owned peers.

PB's loss absorption capacity is currently substantial. At end-
Q112, PB could have reserved just over half its loan book without
breaching minimum regulatory capital requirements.  Fitch
estimates that the regulatory capital adequacy ratio of 37% at
end-H112 is likely to gradually decrease to around 15% over four
to five years, given anticipated 20%-25% annual loan growth rates
and current internal capital generating capacity of 10%.

Fitch notes sizeable contingent risks resulting from the
shareholder's construction business, which is viewed by the
agency as currently more important for Pasha Holding, than the
group's banking business.  Although PB does not finance much of
shareholder's construction activities at present (related party
lending was a moderate 15% of end-2011 Fitch core capital), the
agency is concerned that PB's current capital and liquidity
buffers could weaken if PB is forced to considerably increase its
exposure to related party construction activities.  PB's sister
bank, Kapital Bank ('B+'/Stable/'b-'), which is also owned by
Pasha Holding, currently has substantial exposure to the group's
construction projects.

PB's funding is dominated by related party placements made by
other companies of Pasha Holding (17% of end-2011 liabilities)
and family members of the controlling shareholder (32%).  Some of
these placements are interest-free and result in a low average
cost of funding (3.5% in 2011), which contributes to PB's bottom
line. Fitch cannot reliably assess the longer-term sustainability
of these funds, and expresses concerns that the bank's financial
position in terms of both liquidity and profitability would
weaken if they are withdrawn.  PB may find it difficult to
replace them with local retail funding due to the absence of a
branch network.  At the same time, the bank keeps a sizeable
liquidity buffer in the form of sovereign bonds, equal to 50% of
liabilities at end-2011, which exceeds the amount of potential
deposit outflow.  PB's liquidity also benefits from the absence
of material wholesale funding.

RATING SENSITIVITIES: IDRs AND VR

Downside pressure on PB's ratings could arise if the capital and
liquidity positions are substantially eroded, for example as a
result of very rapid growth or materialization of contingent
risks from other group assets, or if credit underwriting
standards and/or asset quality markedly deteriorate.  A sharp
weakening of the Azerbaijan economy or the country's political
stability, for example in case of a much lower oil price, would
also be negative.

Near-term upside potential for PB's ratings is limited. However,
an extended track record of sound performance, greater
diversification of the bank's franchise and improved transparency
of the group's construction business would be credit positive.

RATING SENSITIVITIES: SUPPORT RATING AND SRF

The Support Rating and SRF could be upgraded if there was a
marked increase in PB's systemic importance and the depth of its
franchise, or if the Azerbaijan authorities more clearly
demonstrate their readiness to support the country's non state-
owned banks. However, Fitch views such changes as unlikely in the
near term.

The rating actions are as follows:

  -- Long-term foreign-currency Issuer Default Rating (IDR):
     assigned 'B+'; Outlook Stable
  -- Short-term foreign-currency IDR: assigned 'B'
  -- Viability Rating: assigned 'b+'
  -- Support Rating: assigned '5'
  -- Support Rating Floor: assigned 'No Floor'



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


CSA CZECH: European Union Approves Government Restructuring Aid
---------------------------------------------------------------
Aoife White at Bloomberg News reports that CSA Czech Airlines won
European Union authorization to receive government restructuring
aid after it sold assets, reduced capacity and gave up landing
slots at European airports.

According to Bloomberg, the European Commission said it approved
a CZK2.5 billion (US$130 million) loan to the airline from state-
owned company Osinek SA after Czech airlines agreed to a five-
year restructuring plan that will also see it sell subsidiaries,
aircraft and other assets and secure a private bank loan for an
aircraft lease.

EU regulators opened a probe into the aid in 2010, saying they
were concerned that the loan was granted on preferential terms,
Bloomberg recounts.

Ceske Aerolinie (known as Czech Airlines or CSA) --
http://www.csa.cz/-- is the national carrier of the Czech
Republic.



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F R A N C E
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PEUGEOT SA: Fitch Downgrades Senior Unsecured Rating to 'BB-'
-------------------------------------------------------------
Fitch Ratings has downgraded Peugeot SA's (PSA) Long-term Issuer
Default Rating (IDR) and senior unsecured rating to 'BB-' from
'BB'.  The Outlook on the Long-term IDR is Negative.

The downgrade reflects Fitch's reassessment of the European auto
sector overall following a further review of PSA's, Renault SA's
('BB+'/Stable) and Fiat Spa's ('BB'/Negative) current and
expected performance and a deeper comparison with close
international peers.

In particular, it is underpinned by Fitch's expectations that PSA
will continue to post negative free cash flow (FCF) through 2014
and the ongoing challenges it faces to improve its business and
financial profile.  In particular, Fitch is concerned about the
group's positioning in the less profitable small- and medium-
sized car segments, where the agency does not expect the ongoing
fierce competition and substantial price pressure to abate in the
near term, as well as the weak or negative profitability in
several international markets, which could take time to overcome,
as competition is also mounting in these markets.

Fitch projects further cash absorption at least in 2012 and 2013,
and the potential for further cash burn in 2014 remains high.
This follows already significant negative FCF in 2011 (EUR1.9
billion) and insufficient positive FCF in 2009-2010 to cover the
EUR3.9 billion of negative FCF in 2008.  The agency believes that
underlying cash from operations (CFO) will gradually improve, in
line with the group's expectations that it will return to
breakeven by end-2014 at FCF level.  However CFO will remain weak
for the rating category in 2012-2013 and may not be enough to
cover ongoing capex at the group level,

Fitch views positively PSA's significant efforts to bolster its
revenue base, streamline its cost structure and preserve or
generate cash.  These measures will have a positive effect on the
group's profitability and balance sheet.  However, the agency is
concerned that improvement will be gradual and that it will take
time for cost-saving actions to fully accrue on earnings and feed
through to the cash flow statement, notably in the current
adverse environment.

The Negative Outlook reflects high execution risks as PSA remains
seriously exposed to a further deterioration in the environment.
A further decline in revenue would compound the short-term costs
associated with restructuring measures and weigh heavily on
profitability before the positive impact from restructuring could
benefit cash generation.  The environment remains extremely
difficult for volume manufacturers in Europe, from continuously
anaemic demand driven by poor macro-economic conditions, fierce
competition and aggressive discounting.  Fitch considers that a
further contraction of new vehicle sales in PSA's main European
markets in 2013 is highly probable following Fitch's base case of
a 7% decline in 2012.

The Outlook could be revised to Stable if Fitch considers that
macro-economic risks recede sufficiently to enable the group to
successfully implement its measures to boost revenue and
streamline costs, including the sustainability of the group's new
models success and improved profitability at its international
operations.  It could also be driven by a decline in leverage at
a quicker pace than currently forecast by Fitch.

Fitch expects that declining underlying profitability and rising
debt from projected negative FCF will push FFO gross adjusted
leverage and CFO on adjusted gross debt to the bottom end of the
'BB' rating category for at least another two years.  Fitch
calculates that FFO gross adjusted leverage will rise
continuously to more than 3.6x at end-2013 from 3.2x at end-2010,
despite asset sales and that CFO on adjusted gross debt will
remain under 25% in the same period.

Nonetheless, the agency has no specific concern that the company
could face immediate liquidity issues. The group enjoyed a
healthy liquidity cushion of EUR7.6 billion in cash and
equivalents at end-June 2012.  It also reported EUR1.4 billion in
financial assets, which Fitch excludes from its calculation of
net debt, but that could provide additional flexibility in case
of heavy financial stress.  In addition, committed credit lines
of EUR2.4 billion at PSA, EUR660 million at Faurecia and EUR8.0
billion at Banque PSA Finance were undrawn at end-June 2012.

In addition, the group has taken several measures to preserve its
liquidity and others to raise cash.  In particular, the group is
in the middle of a EUR1.5bn asset disposal program, including its
rental car business Citer, which it has already disposed of for
EUR0.5 billion and EUR0.3 billion of real estate divestitures.
PSA also expects to finalize the sale of a large stake in its
logistics division Gefco, although the total amount and timing
remains uncertain.  The industrial business's liquidity will also
benefit from the payment of an exceptional EUR360 million
dividend from BPF, although the impact will be neutral at group
level.  Finally, the 7% stake purchase in PSA by GM in Q112 was
accompanied by a EUR1bn capital increase.

What Could Trigger A Rating Action?

Positive: Future developments that may, individually or
collectively, lead to positive rating action include

  -- The group's automotive operating margins becoming positive
  -- FCF turning positive, leading in particular to FFO adjusted
     gross leverage below 2.5x

Negative: Future developments that may, individually or
collectively, lead to negative rating action include

  -- The environment continuing to deteriorate, leading to
     further revenue decline at group level and continuous
     negative operating margins (actual or expected)
  -- If Fitch believes the group will not be able execute its
     plans of returning to positive FCF by end-2014
  -- Deteriorating liquidity


RENAULT SA: Fitch Affirms 'BB+' Rating on Sr. Unsecured Notes
-------------------------------------------------------------
Fitch Ratings has affirmed Renault SA's Long-term Issuer Default
Ratings (IDR) and senior unsecured notes at 'BB+'.  The Outlook
is Stable.

The affirmation and the Stable Outlook reflect Renault's moderate
but resilient credit metrics in a difficult environment for
European volume carmakers.  Although the environment remains
extremely difficult for the group and makes an upgrade unlikely
in the short-term, Fitch believes that the company has sufficient
headroom in the current ratings to accommodate the agency's
current base assumptions of a sales decline in Europe.

Fitch expects new vehicle sales to decline by 7% in 2012 and
believes that a further contraction of sales in Renault's main
European markets in 2013 is highly probable. A positive rating
action could be considered in the medium term if the company's
current resilient performance is sustained.

Renault's operating margin eroded slightly in H112 to 2.3% from
2.6% in 2011 and 2.8% in 2010 but automotive operations remained
profitable in an adverse environment, contrary to close peer
Peugeot SA.  The cost base benefited from increased synergies
with Nissan, greater amortization of fixed costs as a result of
higher production, cost-cutting measures and the increased
production outside of western Europe.  However, Fitch expects the
difficult environment in Europe, notably continuous price
pressure, unabated competition and launch costs associated with
the upcoming new Clio, to challenge further improvement in 2012.

Despite continuous diversification, Renault's sales remain
concentrated in Europe, with a bias to weaker Southern markets
such as Spain, Italy and France, where the euro zone debt crisis
has the most impact on new car sales.  Renault also derives the
majority of its revenue from the less profitable small- and
medium-sized car segments, where competition is fiercest and
price pressure is strongest.  However, this has been largely
mitigated by the significant success of its entry-level vehicles
with a sound profitability.  The success of the growing Dacia
brand is pivotal in compensating for the sales decline of the
core Renault models and also favors geographical diversification.

Net financial debt has fallen substantially since 2009 as a
result of positive free cash flow and asset sales, while EBITDA
and funds from operations (FFO) rebounded in the same period.
Fitch assumes Renault's FFO adjusted net leverage will remain
broadly unchanged at 0.6x at end-2012, after decreasing from 0.9x
at end-2010 and 4.2x at end-2009.

Liquidity remains sound as Renault reported cash and cash
equivalents of EUR8.1bn at group level (EUR7.4bn for its
industrial operations) at end-H112 and a total of EUR8.2bn of
available, unused credit facilities (EUR3.7bn at Renault SA, and
EUR4.5bn at RCI Banque).  Total adjusted financial debt from
industrial operations was EUR10.5bn at end-H112 (EUR3.8bn current
liabilities) including a EUR1.9bn adjustment for operating
leases.

What Could Trigger A Rating Action?

Positive:

Future developments that may, individually or collectively, lead
to a positive rating action include:

  -- Sustainable improvement in financial metrics, including net
     adjusted leverage below 0.5x and cash from operations (CFO)
     on total adjusted debt above 40%
  -- Sustainable increase in market shares, combined with
     improved profitability, in particular, group operating
     margin trending towards 3% and sustained return to positive
     auto operating margins
  -- Successful and profitable introduction of a premium model
     range

Negative:

Future developments that may, individually or collectively, lead
to a negative rating action include:

  -- Negative operating margins, coming notably from falling
     global sales
  -- Deterioration of key financial metrics, including net
     adjusted leverage remaining above 1.5x and CFO/adjusted debt
     below 25%



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G E R M A N Y
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FRESENIUS SE: S&P Affirms 'BB+' LT Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' long-term
corporate credit ratings on Germany-based health care group
Fresenius SE & Co. KGaA (FSE) and subsidiary Fresenius Medical
Care AG & Co. KGaA (FME; together with FSE, the group). "At the
same time, we removed the ratings from CreditWatch, where they
were placed with negative implications on April 30, 2012,
following FSE's plans to acquire German private hospitals
operator Rhoen-Klinikum AG (Rhoen)," S&P said.

"In addition, we withdrew the 'BBB-' issue and '2' recovery
ratings on the proposed EUR1,850 million and US$1,600 million
senior secured credit facilities to be issued by FSE's
subsidiaries Fresenius Finance II B.V. and Fresenius U.S. Finance
I Inc. to finance the acquisition of Rhoen Klinikum," S&P said.

"We also affirmed and removed from CreditWatch negative our
'BBB-' issue rating on FSE's and FME's senior secured debt
facilities. The recovery rating on these instruments is unchanged
at '2', indicating our expectation of substantial (70%-90%)
recovery for senior secured creditors in the event of a payment
default," S&P said.

"In addition, we affirmed and removed from CreditWatch negative
our 'BB+' issue rating on FSE's and FME's senior unsecured notes.
The recovery rating on these instruments is unchanged at '3',
indicating our expectation of meaningful (50%-70%) recovery for
senior unsecured noteholders in the event of a payment default,"
S&P said.

"Finally, we affirmed and removed from CreditWatch negative our
'BB-' issue rating on FSE's euro-denominated promissory notes
('Schuldscheindarlehen'). The recovery rating on these notes is
unchanged at '6', indicating our expectation of negligible (0%-
10%) recovery in the event of a payment default," S&P said.

"The rating actions primarily reflect that FSE has aborted its
plans to take over German private hospitals operator Rhoen-
Klinikum, because the group failed to reach its target equity
level of no less than 90%. The rating actions also reflect our
understanding that the group will use the equity of about EUR1
billion that it raised initially to help finance the Rhoen-
Klinikum acquisition, to purchase Illinois-based blood technology
company Fenwal Inc. (B/Stable/--). As such, we estimate that
FSE's debt protection metrics will remain at levels that we view
as commensurate with the 'BB+' rating, namely, Standard & Poor's-
adjusted debt-to-EBITDA of 3.0x-3.5x, and funds from operations
(FFO) to debt of about 20%," S&P said.

"We believe that the group will achieve these metrics by
maintaining organic revenue growth in the mid-single digits in
the remainder of 2012. In addition, we forecast that various
acquisitions executed over the past 12 months could lift the
group's total revenues by about 14% in full-year 2012.
Furthermore, we anticipate that, over the medium term, total
revenue growth will remain in the mid-single digits, reflecting
the solid performance of FSE's clinical nutrition and intravenous
generic business supported by growth in emerging markets," S&P
said.

"We anticipate that the group will maintain an EBITDA margin of
19%-20% over the short and medium term, with pricing pressure
(including changes in reimbursement policies) from established
markets such as the U.S. and Europe offset by cost efficiencies
and synergies from other parts of the business," S&P said.

"The ratings continue to reflect our assessment of the group's
financial risk profile as 'significant' owing to frequent and
primarily debt-financed acquisitions. However, we view the
group's ability to deleverage and generate good free cash flow as
supportive of the ratings," S&P said.

"We assess the group's business risk profile as 'satisfactory'
based on among other things, FME's position as the world's
largest provider of products and services for dialysis, FSE's
market-leading position in Europe for clinical nutrition and
infusion therapy, and its leading position in the German private
hospital industry," S&P said.

"We align our corporate credit rating on FME with that on FSE in
accordance with our assessment of FME's relationship with FSE,
which is characterized by FSE's significant influence over FME,
as well as the nature of their economic relationship," S&P said.

"The issue rating on FSE's and FME's senior secured debt
facilities is 'BBB-'. The recovery rating on these instruments is
'2', indicating our expectation of substantial (70%-90%) recovery
for senior secured creditors in the event of a payment default,"
S&P said.

"The issue rating on FSE's and FME's senior unsecured notes is
'BB+'. The recovery rating on these instruments is '3',
indicating our expectation of meaningful (50%-70%) recovery for
senior unsecured noteholders in the event of a payment default,"
S&P said.

"The issue rating on FSE's euro-denominated promissory notes
('Schuldscheindarlehen') is 'BB-'. The recovery rating on these
notes is at '6', indicating our expectation of negligible (0%-
10%) recovery in the event of a payment default," S&P said.

"The stable outlook reflects our view that FME is likely to
refinance sizable 2013 debt maturities by the end of 2012. It
further reflects our view that the group will be able to maintain
an adjusted debt-to-EBITDA ratio of about 3.0x-3.5x and FFO to
debt of about 20%. We see these ratios as reflective of revenue
growth in the high-single digits over the medium term. We
anticipate that revenue growth will be driven primarily by both
FME's and FSE's strong performance in emerging markets and
contributions from acquired businesses," S&P said.

"We could consider taking a negative rating action if FSE fails
to refinance its 2013 debt maturities by the end of 2012 or if
the group steps up its acquisition activities such that debt
protection metrics fall below the levels that we view as
commensurate with the 'BB+' ratings," S&P said.

"We see downside to the ratings due to operational problems as
unlikely in view of favorable industry trends. However, any
pressure on profitability would likely mainly stem from a
tougher-than-anticipated reimbursement environment in established
markets, in our opinion," S&P said.

"Rating upside appears remote over the next six to 12 months
because the group will have to address its debt maturities and
fully integrate and absorb the debt from the recent
acquisitions," S&P said.

"We could consider a positive rating action over the medium term
if FSE diversifies its revenue stream and continues to improve
its operating performance, in the context of a stable
reimbursement environment," S&P said.


PROVIDE BLUE 2005-2: S&P Lowers Rating on Class E Notes to 'B-'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
PROVIDE BLUE 2005-2 PLC's class D and E notes. "At the same time,
we affirmed our ratings on the issuer's class A+, B, and C
notes," S&P said.

"The rating actions follow our analysis of the transaction's
performance. Since our June 2011 review, we have observed an
increase in defaulted reference claims (90+ day arrears and
bankruptcies, which have been reported to the trustee) to 1.82%
from 1.66% of the current pool balance. Defaulted reference
claims have been relatively stable in absolute terms at about
EUR27 million during this period, which we consider to be
relatively high. This has increased the level of credit risk in
the transaction, especially for the class D and E notes," S&P
said.

"Since closing, cumulative net losses have increased to
EUR12,084,665 and reduced the size of the class E notes'
threshold (the first loss piece) to EUR9,115,335 from
EUR21,200,000. This has decreased the level of credit enhancement
available to these notes to 0.60% from 0.66% since June 2011.
Losses per interest payment date peaked at EUR1.3 million in May
2010, and decreased to EUR360,000 in February 2012. However, in
Q2 2012, they reached a relatively high level at EUR873,000," S&P
said.

"We have assessed the likelihood of future losses for both the
performing and nonperforming parts of the collateral pool by
considering realized losses and delinquencies to date, and by
taking into account historical recovery rates in this portfolio,"
S&P said.

"Since our previous review on June 27, 2011, the level of credit
protection through subordination for the class A+ and B to D
notes has increased due to the underlying reference pool's
amortization," S&P said.

"Following our review, we have affirmed our ratings on the class
A+, B, and C notes because we consider the current level of
credit protection to be commensurate with our ratings on these
classes of notes," S&P said.

"We lowered our ratings on the class D and E notes due to the
decrease in credit support provided by the subordinated classes
of notes and rising credit risk resulting from the relative
increase in defaulted reference claims," S&P said.

"Amortization has reduced the pool factor in PROVIDE BLUE 2005-2
to 44%. We will continue to monitor the development of defaulted
reference claims, arrears, and actual losses in the transaction,"
S&P said.

PROVIDE BLUE 2005-2 is a partially funded synthetic German
residential mortgage-backed securities (RMBS) transaction using
the Provide Platform provided by Kreditanstalt fr Wiederaufbau
(AAA/Stable/A-1+).

            STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

       http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

                     Rating
Class       To                   From

PROVIDE BLUE 2005-2
EUR155.9 Million Floating-Rate Credit-Linked Notes

Ratings Lowered

D           BB+ (sf)             BBB (sf)
E           B- (sf)              BB (sf)

Ratings Affirmed

A+          AAA (sf)
B           AA (sf)
C           A (sf)


PROVIDE-VR 2004-1: S&P Affirms 'BB+' Rating on Class D Notes
------------------------------------------------------------
Standard & Poor's Ratings Services has raised its credit rating
on PROVIDE-VR 2004-1 PLC's class C notes. "At the same time, we
have affirmed our ratings on the class A+, A, B, and D notes,"
S&P said.

"The upgrade follows our periodic review of the transaction,
which shows improved transaction performance since our previous
full review in February 2011. It reflects the increased credit
protection for the class C notes through subordination, which has
increased due to sequential amortization," S&P said.

"Current credit events (loans in bankruptcy or arrears for more
than 90 days, which have been reported to the trustee) remained
at about 3% of the current outstanding balance since our previous
full review, and are currently at 2.90% or EUR3.477 million," S&P
said.

"Total transaction loss allocations have diminished the balance
of the first loss piece, which has decreased to EUR5,844,209 from
EUR6,230,145 in February 2011, and from EUR9,000,000 at closing.
This comparatively low amount of applied losses since our
previous full review is also caused by increasing recovery rates,
causing the weighted-average recovery rate to rise to 57% from
53% in
February 2011. However, we consider the recovery rate to be low,
which is caused by a relative high portion of prior-ranking loans
in the portfolio, among other things," S&P said.

"Considering realized losses, credit events, and delinquencies to
date -- and taking into account historical recovery rates in this
particular portfolio -- we have assessed the likelihood of future
losses for both the performing and nonperforming parts of the
collateral portfolio," S&P said.

"Based on this assessment, we have raised our rating on the class
C notes because of the increased credit protection to this class
of notes. Additionally, we have affirmed our ratings on the class
A+, A, B, and D notes because, in our opinion, credit enhancement
is commensurate with the current rating levels," S&P said.

"We will continue to monitor the development of credit events as
well as actual losses in this transaction," S&P said.

PROVIDE VR 2004-1 is a partially funded synthetic German
residential mortgage-backed securities (RMBS) transaction using
the Provide Platform provided by Kreditanstalt fr Wiederaufbau
(AAA/Stable/A-1).

            STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

       http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class                Rating
            To                   From

PROVIDE VR 2004-1 PLC
EUR66.35 Million Floating-Rate Credit-Linked Notes

Rating Raised

C           AA- (sf)             A+ (sf)

Ratings Affirmed

A+          AAA (sf)
A           AAA (sf)
B           AA+ (sf)
D           BB+ (sf)


XELLA INTERNATIONAL: Moody's Affirms 'Ba3' CFR; Outlook Negative
----------------------------------------------------------------
Moody's Investors Service has changed the outlook on Xella
International S.A.'s ratings to negative from stable. Moody's
also affirmed the company's Ba3 CFR and PDR and the Ba3 rating on
the EUR300 million of 8% senior secured notes issued by Xefin Lux
S.C.A.

Ratings Rationale

"The change to a negative outlook reflects concerns about limited
headroom under the company's bank facility financial covenants as
a result of weaker than expected financial performance due to a
difficult environment in the European building materials sector,"
said Tanya Savkin, a Moody's Vice President -- Senior Analyst and
lead analyst for Xella. "However, at this time we expect the
company to experience only a moderate decline in performance and
believe that, if required, waivers or an amendment will be
forthcoming from the lenders."

In 2011, Xella reported an 11% increase in sales to EUR1,271
million and an 8% increase in Normalised EBITDA to EUR208 million
driven by volume growth and successful implementation of price
increases in all three of its business units. Strong operational
performance in Building Materials and good market demand in
Western Europe, Russia and China were partially offset by ongoing
weak market demand in Southeastern Europe. However, during the
first six months of 2012 volumes in key markets started to
decline and Moody's expects construction market conditions in
Europe to soften for at least the remainder of 2012, which could
lead to lower sales and EBITDA in the second half of the year,
although the decline will be dampened by the expansion projects
the company has completed this year.

Because the company's performance has not improved as expected --
and bank facility covenants were set based on expanding EBITDA --
covenant headroom is shrinking and the company may need to seek a
waiver or an amendment for its covenants, which steadily tighten.
This, in combination with volatile working capital, increased
capital expenditures for several expansion projects and debt
amortization of EUR60 million in each of 2013 and 2014,
undermines Xella's liquidity, notwithstanding its EUR66 million
of cash as of 30 June 2012.

While Moody's believes that there is limited scope for a rating
upgrade in the short term, the outlook could be stabilized if the
company (i) increases its covenant headroom via either improved
performance or a successful covenant negotiation with its
lenders, (ii) de-levers its balance sheet leading to a Debt-to-
EBITDA ratio below 3.5x, (iii) improves its EBIT-to-Interest
ratio towards 2.0x, and (iii) maintains its Free Cash Flow-to-
Debt ratio above 5%.

Conversely, downward pressure could be exerted on the rating as a
result of underperformance leading to: (i) a gross Debt-to-EBITDA
ratio towards 5.0x, (ii) a EBIT-to-Interest ratio towards 1.5x or
(iii) a Free Cash Flow-to-Debt ratio consistently below 5%.

The principal methodology used in rating Xella International S.A.
and Xefin Lux S.C.A. was the Global Building Materials Industry
Methodology published in July 2009. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.

Headquartered in Duisburg (Germany), Xella is a manufacturer of
modern building materials and a producer of lime. Xella is
currently owned by PAI partners and Goldman Sachs Capital
partners. The company reported consolidated revenues of EUR1.1
billion for the year ended 31 December 2011.



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


* HUNGARY: Corporation Liquidations Up 28% in 12 Months Ended Aug
-----------------------------------------------------------------
MTI Econews reports that the number of liquidation procedures
against Hungarian companies grew 28% to 23,172 in the 12 months
to August, compared to the previous 12 months.

Company monitoring website feketelista.hu told MTI that in 2010,
16,133 companies had been wound up, and their number grew 12% to
18,103 last year.

According to MTI, Chairman of the national association of
liquidators Ferenc Somogyi said that the acceleration can be
explained with the worsening financial situation of businesses
and the stricter actions of Hungary's tax authority.



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


MCCABE BUILDERS: KMPG Appointed as Liquidator
---------------------------------------------
Donal O'Donovan at Independent.ie reports that McCabe Builders
(Dublin) has been put into liquidation amid a growing controversy
over missing millions.

Independent.ie relates that accountant Kieran Wallace of KPMG has
been appointed liquidator of McCabe Builders, after recruitment
firm MCR Personnel went to court to have the company wound up
over what it claimed was an unpaid debt.

The appointment of a liquidator is just the latest in a series of
blows for former property kingpin John McCabe, the report notes.

Last week, Independent.ie recalls, NAMA secured a number of High
Court orders freezing the assets of Mr. McCabe and members of his
family after raising fears that EUR6.2 million of assets that
should have been ring-fenced to pay off debts had been
"misappropriated or dissipated" without consent.

The family denies the claims and the case is due back in court in
October, Independent.ie reports.

According to the report, the McCabes' companies owe NAMA more
than EUR235 million, and had been working with the agency to work
through the debt until the relationship unravelled in recent
weeks.

Independent.ie says relations are understood to have broken down
after the McCabes allegedly paid as much as EUR6 million to a
company called Western Gulf Advisory in the Middle East in an
effort to refinance their loans.  The new loans never
materialized, leaving McCabes still owing their original debt and
NAMA fuming over the payouts.

The report relates that the freezing order came just a week after
NAMA had key assets in his property empire taken into
receivership, and following MCR Personnel's initial move to
recover its own debts from the company.

McCabe Builders (Dublin) is a building firm set up in the 1970s
by husband and wife team John and Mary McCabe.


* IRELAND: Moody's Says Neg. Equity Key Driver of RMBS Default
--------------------------------------------------------------
High levels of negative equity will drive losses in Irish
residential mortgage-backed securities (RMBS) to 9.5% based on
defaults peaking around 20% in early 2013, according to a new
report published on Sept. 19 by Moody's Investors Service.
However, uncertainty over the full extent of losses remains as a
result of the growing effect of moral hazard. Unlike most of the
servicers it spoke to, Moody's expects defaults on unsustainable
mortgage debt to typically result in debt forgiveness rather than
repossession.

The new report titled "Key Drivers of Default in Irish RMBS Pools
Will Persist in 2013" is now available to Moody's subscribers in
the link at the end of this announcement.

"The key driver of future defaults in Irish RMBS pools will be
loans originated with high loan-to-value ratios (LTVs) in the
run-up to the crisis, which are now in the deepest negative
equity. In Moody's previous report in 2010, LTVs were not yet a
driver for mortgage loan defaults although we did predict they
would ultimately become one of the key default drivers, a pattern
which is now starting to emerge," notes Anthony Parry, Moody's
Vice President and co-author of the report. "Higher LTV loans
which we estimate are now in negative equity, have a default rate
of 21.7%, 1.7 times the rate observed for loans not in negative
equity" adds Mr. Parry.

However, moral hazard is also having a growing effect on loan
defaults. Without the strictest of controls in place, moral
hazard will drive default rates even higher and increase losses
on Irish mortgage loans. The current dearth of repossessions and
the recently proposed personal insolvency legislation is starting
to result in higher defaults due to moral hazard. Obligors with
loans in negative equity are more likely to default even when
they have the financial capacity to pay because they stand to
benefit most from the legislation. Unemployment has been broadly
flat since 2010 and is therefore less of a key driver of recent
defaults.

"We spoke to a number of servicers to get their views on current
market trends. They had mixed opinions on the effect of moral
hazard on default levels to date," adds Steven Becker, Moody's
analyst and co-author of the report. "We received estimates from
only negligible levels up to as much as 40% of current arrears
are attributable to borrowers who are not truly unable to pay."

While Moody's notes that other characteristics will persist as
key default drivers, these will be outweighed by the impact of
negative equity on future defaults. These key default drivers to
date include (1) self-employed borrowers; (2) loans taken out for
the purpose of a buy-to-let (BTL) investment; and (3) loans
originated outside of Dublin and Cork.


* IRELAND: Moody's Says RMBS Performance Deteriorates in July
-------------------------------------------------------------
The performance of the Irish prime residential mortgage-backed
securities (RMBS) market continued to deteriorate during the
three-month period leading to July 2012, according to the latest
indices published by Moody's Investors Service.

From April to July 2012, the 90+ day delinquency trend and 360+
day delinquent loans (which are used as a proxy for defaults)
reached a new peak, rising steeply to 15.19% from 13.99% and to
6.58% from 5.50% respectively, of the outstanding portfolios.
Moody's annualized total redemption rate (TRR) trend was 3.93% in
July 2012, down from 4.08% in July 2011.

Moody's outlook for Irish RMBS is negative. The steep decline in
house prices since 2007 has placed the majority of borrowers deep
into negative equity. Falling house prices will increase the
severity of losses on defaulted mortgages. Irish house prices
have already fallen by 50.3% between September 2007 and July 2012
and Moody's expects that house prices will fall a further 20%
from today's levels (bringing the aggregate peak-to-trough fall
to 60%). The rating agency expects the Irish economy will only
grow 0.2% in 2012. In this weak economic recovery, it will be
difficult for distressed borrowers to significantly increase
their debt servicing capabilities and so arrears are likely to
continue increasing.

High levels of negative equity will drive losses in Irish RMBS to
9.5% based on defaults peaking around 20% in early 2013,
according to a new report published by Moody's Investor Services.
However, uncertainty over the full extent of losses remains as a
result of the growing effect of moral hazard. Unlike most of the
servicers it spoke to, Moody's expects defaults on unsustainable
mortgage debt to typically result in debt forgiveness rather than
repossession.

On September 12, Moody's downgraded to A3(sf) the ratings of 24
securities across 12 Irish RMBS out of which seven were also
placed on review for downgrade. Concurrently, Moody's placed on
review for downgrade additional 15 Irish RMBS securities (senior
and subordinated notes). The downgrades follow Moody's decision
to lower the Irish country ceiling to A3 on September 6, 2012.
The main driver for the rating review placements was Moody's
intention to reassess credit enhancement adequacy for each of the
rated notes, given the increased risk of economic and financial
instability.

As of July 2012, the 19 Moody's-rated Irish prime RMBS
transactions had an outstanding pool balance of EUR49.5 billion.
This constitutes a year-on-year decrease of 7.4% compared with
EUR53.5 billion for the same period in the previous year.

Moody's quarterly indices are usually published mid-month and can
be found on www.moodys.com in the Structured Finance sub-
directory under the Research & Ratings tab. In the left-hand side
bar, under the Research Type category heading, select Statistical
Data. Finally, on the Research tab in the middle of your screen,
select the third option, Indices & Data.



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


FIAT SPA: Fitch Affirms 'BB' Long-Term Issuer Default Rating
------------------------------------------------------------
Fitch Ratings has affirmed Fiat Spa's (Fiat) Long-term Issuer
Default Ratings (IDR) and senior unsecured rating at 'BB' and
Short-term IDR at 'B'.  The Outlook on Fiat's Long-term IDR is
Negative.  The agency has also affirmed Fiat Finance & Trade Ltd,
S.A.'s (FFT) senior unsecured rating at 'BB'.

The affirmation reflects Fitch's expectations that Fiat will
manage to limit cash erosion in the next couple of years, as
steady performance in Brazil and continuous robust performance of
the group's other divisions will mitigate cash absorption in
Europe.

The ratings are based on Fiat's standalone credit profile (ex-
Chrysler) but incorporate benefits that are derived from its
combination with Chrysler LLC.  In particular, increased
operational integration and cooperation with Chrysler, notably
through vehicle development and increasing sharing of powertrains
and components, provide room for further improvement in
profitability.

Fiat's earnings have become increasingly reliant on Chrysler as
Fiat's standalone results remained weak in 2011 and H112,
hindered principally by ongoing trading losses (as defined by
Fiat, i.e. operating losses before one-off items) of its mass-
market brands in EMEA (EUR0.5 billion in 2011 pro-forma including
Chrysler, EUR345 million in H112).  Conversely, Chrysler's
operating margin strengthened further to 4.5% in H112 from 3.6%
in 2011 and 1.8% in 2010 (US GAAP).

However, the current strict ring-fencing of Chrysler's debt and
cash flows limits the benefit of Chrysler's improvements to
Fiat's creditors as the latter have no access to Chrysler's cash
at a time when its standalone cash generation ability has
significantly weakened.  Nonetheless, positive free cash flow
(FCF) at Chrysler can enable the group to finance common project
developments and mitigate the lower contribution from Fiat's core
cash generation ability.

Pressure on Fiat's revenue and trading margins remains
considerable and underpins the Negative Outlook. Fitch believes
that adverse market conditions will prevail in Europe at least
through 2013.  The agency expects new vehicle sales to decline by
7% in 2012 and believes that a further contraction of sales in
Fiat's main European markets in 2013 is highly probable.  In
addition, declining industry sales combined with aggressive
discounting to try and preserve market shares will have an
extremely negative impact on underlying funds from operations
(FFO).  Potential adverse movements in working capital, either
from increasing inventories or unfavorable payment terms to
support suppliers may bite further in cash generation.

Fitch could downgrade the rating if it believes that revenue,
profitability and cash flow will decline more than its base case.
The agency currently projects trading margin to be at 6.5%-7.0%
in NAFTA in 2012-2013 and remain poor in EMEA at negative 3.0%-
3.5%. FCF should be slightly negative in 2012-2013, before
corporate activity, in particular further stake increases in
Chrysler in H212 and 2013.

The group follows a conservative financial strategy and has ample
liquidity.  Fiat's industrial operations excluding Chrysler
reported EUR9.8 billion in cash and equivalents at end-June 2012,
further bolstered by EUR1.95 billion of undrawn committed credit
lines.  This largely covers EUR6.6 billion of debt maturing in
2012-2013 for Fiat excluding Chrysler, as well as the negative
FCF projected by Fitch in 2012-2013.  Chrysler has EUR0.5 billion
of debt maturing in 2012-2013, largely covered by EUR9.6 billion
in cash and marketable securities and EUR1 billion of undrawn
committed credit lines.

What Could Trigger A Rating Action?

Positive:
Future developments that may, individually or collectively, lead
to a positive rating action include:

  -- Sustained positive FCF
  -- Higher margins at Fiat auto mass market, EMEA and group
     level

Negative:
Future developments that may, individually or collectively, lead
to a negative rating action include:

  -- Sustained fall in revenue and operating margins
  -- Mounting liquidity issues, including refinancing concerns
  -- Consolidated FFO gross adjusted leverage above 3x on a
     sustained basis
  -- Evidence of tangible support to Chrysler



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


ATF BANK: Fitch Rates US$100-Mil. Subordinate Notes at 'BB-'
------------------------------------------------------------
Fitch Ratings has assigned ATF Bank's US$100 million perpetual
non-cumulative subordinate notes a Long-term foreign currency
rating of 'BB-'.

The bonds were issued in November 2006 via the special purpose
vehicle (SPV) ATF Capital B.V.  In Q312 ATF Bank decided to
transfer the issue from the SPV to its own balance sheet.  The
interest rate on the notes is set at 10% (to be paid semi-
annually) until November 2016, and 7.33% thereafter.  ATF has a
call option in respect to the notes in November 2016 or on any
interest payment date thereafter.

Fitch has used ATF's Long-term Issuer Default Rating (IDR) as the
anchor rating for rating the notes, reflecting the agency's view
that support from UniCredit S.p.A. ('A-'/Negative) may be
available to help the bank service subordinated, as well as
senior obligations.  However, the four-notch difference between
ATF's IDR and the notes' rating reflects two notches each for
incremental non-performance risk (a higher probability of non-
performance on the perpetual notes relative to senior debt) and
greater potential loss severity (lower recoveries in case of
default).

Fitch notes that ATF has paid all coupons on the notes to date,
notwithstanding the bank's weak stand-alone financial position
and its recent need for capital support from UniCredit S.p.A.
This track record of support for the notes has limited Fitch's
assessment of the incremental non-performance risk on the notes
to two notches.

ATF Bank has a Long-term IDRIDR of 'BBB' with a Negative Outlook,
Short-term IDR of 'F3', Long-term local currency IDR of 'BBB'
with a Negative Outlook, Viability Rating of 'b-', a National
Long-term rating of 'AA+(kaz)' with Negative Outlook and a
Support Rating of '2'.

ATF could be downgraded if UniCredit S.p.A.'s ratings are
downgraded.  A downgrade is also possible if Fitch believes that
further support from the parent has become less likely, or if a
disposal of the subsidiary is being more actively pursued.

ATF was the fifth-largest bank in Kazakhstan, holding around 6.9%
of system assets, at 1 July 2012.  It is primarily a corporate
bank with 109 outlets located throughout Kazakhstan.  ATF is
ultimately owned by UniCredit S.p.A.


BTA BANK: Ukrainian Court Recognizes Restructuring Proceedings
--------------------------------------------------------------
Nariman Gizitdinov at Bloomberg News reports that BTA Bank, the
Kazakh lender seeking to overhaul its debt for a second time,
said a Ukrainian court recognized the restructuring proceedings
and extended protection over its assets.

"This recognition is a part of the bank's current restructuring
process and the order follows successful applications for
recognition made by the BTA in the U.K. and U.S., which were
obtained on July 11 and Aug. 16, respectively," Bloomberg quotes
the Almaty-based lender as saying in a statement e-mailed on
Wednesday.

State-run BTA, Kazakhstan's third largest bank by assets, said
last month that an Almaty court had prolonged a restructuring
deadline by three months to Dec. 20, Bloomberg recounts.  BTA had
been seeking an agreement by September after failing to make a
January interest payment on dollar bonds due July 2018, Bloomberg
notes.

BTA Group -- comprised of BTA Bank and its subsidiaries and
affiliated companies -- is one of the leading banking groups in
the Commonwealth of Independent States and has affiliated banks
in Russia, Ukraine, Belarus, Georgia, Armenia, Kyrgyzstan and
Turkey.

As of May 1, 2012, BTA Bank was the third largest bank in the
Republic of Kazakhstan by total assets with a market share of
10.9%, serving approximately 710,218 retail customers, 73,200
small and middle business customers and 1,397 corporate
customers, most of which reside or are registered, or maintain
their operations, inside Kazakhstan.  As of May 1, 2012, the Bank
employed 5,290 people inside and 2 people outside Kazakhstan.

In 2009, investigations and proceedings were launched in the
Republic of Kazakhstan, the United Kingdom, and elsewhere in
relation to fraudulent and unlawful transactions entered into by
the Bank's former management prior to February 2009 which, it
transpires, caused the Bank very significant losses.

On Oct. 7, 2009, the Bank applied to the Financial Court for an
order to commence a restructuring.  The foreign representative in
2010 filed a petition (Bankr. S.D.N.Y. Case No. 10-10638) in
Manhattan and the judge granted a petition for recognition of the
Kazakhstan proceeding as "foreign main proceeding.

The Kazakhstan proceedings were closed in August 2010 after all
distributions were made.  The Chapter 15 case was closed in
January 2011.  Creditors whose claims were restructured received
a mixture of cash, senior debt, subordinated debt, other forms of
debt, equity and so-called recovery units  in consideration for
the restructuring of their claims.

Since the beginning of 2011, the Bank's financial situation,
however, has deteriorated despite measures undertaken by
management.  A high cost of funding and fierce competition among
Kazakhstan banks for business led to a steep deterioration in the
Bank's net interest margin, the measure of the difference between
the interest income generated by the Bank and the amount of
interest paid out to its lenders, relative to the amount of its
(interest-earning) assets.  Due to the subdued business
environment and cumbersome legal procedures, recoveries on non-
performing loans were considerably lower than expected. As a
result, the Bank showed a total negative equity under
International Financial Reporting Standards of KZT 216 billion
(US$1.5 billion) by June 30, 2011, which worsened to an estimated
IFRS consolidated equity deficit of KZT 367 billion (US$2.5
billion) at year end and has continued to worsen in 2012.

Considering the Bank's financial situation and the need to
restore the IFRS Tier 1 capital position, the Bank commenced
discussions with its creditors in order to effect a second
restructuring of all or part of its financial indebtedness under
Kazakhstan laws.

The Bank on April 5, 2012, formally agreed to the creation of a
steering committee of creditors to coordinate further discussions
in relation to the Restructuring.  The Steering Committee
selected Houlihan Lokey and Deloitte as joint financial advisers
and Baker & McKenzie as legal adviser.

On April 25, 2012, the Bank's board of directors resolved to
initiate the Restructuring.  On April 28, the Bank entered into
an agreement on restructuring with the National Bank of
Kazakhstan pursuant to Article 59-3(3) of the Kazakhstan Banking
Law.  On April 28, after obtaining a review and comments from the
Steering Committee's advisers, the Bank submitted a draft
restructuring plan to the National Bank of Kazakhstan. After the
National Bank of Kazakhstan completed its review, the way was
clear for the Bank to seek a Financial Court order opening a
restructuring proceeding under Kazakhstan law.

The Bank made an application for restructuring under the Banking
Law, the Civil Procedural Code and the Amending Law on May 2,
2012.

The second restructuring will be effected through the
restructuring of the existing claims arising from the financial
instruments issued during the first restructuring.  The
Restructuring is expected to be completed by Sept. 27, 2012.

The Chapter 15 petition was filed to prevent creditors from
seeking to take action against the Bank or its assets in the
United States.  The Bank's principal assets in the United States
are balances in accounts of correspondent banks located in New
York City.  Its major American creditors are financial
institutions, such as Deere Credit Inc, Goldman Sachs Lending
Partners LLC, LM Moore, L.P., PNC Bank N.A. (formerly National
City Bank Cleveland).

The Steering Committee of Creditors comprises Ashmore Investment
Management Limited (as agent for and on behalf of certain funds
and accounts for which it acts as investment adviser), the Asian
Development Bank, D.E. Shaw Oculus International, Inc. and D.E.
Shaw Laminar International, Inc., Gramercy Funds Management LLC,
J.P. Morgan Securities Ltd., Nomura International plc, The Royal
Bank of Scotland plc, SAM Salute Advisors Ltd., Swedish Export
Credits Guarantee Board - EKN and VR Capital Group Ltd. in its
capacity as General Partner of VR Global Partners, L.P

BTA Bank is represented in the U.S. by Evan C. Hollander, Esq.,
at White & Case LLP.

Judge James M. Peck oversees the Chapter 11 case.



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


INTELSAT JACKSON: Moody's Rates US$640MM Sr. Unsec. Notes Caa2
--------------------------------------------------------------
Moody's Investors Service assigned a Caa2 rating to Intelsat
Jackson Holdings S.A.'s new $640 million senior unsecured un-
guaranteed notes issue. Jackson is an indirect, wholly-owned
subsidiary of Intelsat S.A. (Intelsat) which, as the senior-most
issuer in the Intelsat group of companies, is the entity at which
Moody's maintains corporate family and probability of default
ratings (CFR and PDR respectively), both of which remain
unchanged at Caa1. As well the corporate family's speculative
grade liquidity rating remains unchanged at SGL-3 (indicating
adequate liquidity) and the outlook remains unchanged at stable.

The new notes are being issued to fund tender offers that will
retire the entire outstanding amount, some $603 million, of
Jackson's 11.25% senior unsecured un-guaranteed notes due June
15, 2016. With Intelsat's consolidated debt not materially
affected, the transaction is leverage-neutral and therefore has
no impact on Intelsat's Caa1 CFR/PDR. In addition, since the new
notes replace notes of equal ranking and the amount being issued
is approximately equal to the amount being tendered-for, the
transaction has no impact on ratings of other debt instruments in
the Intelsat group of companies. Similarly, as the transaction
has no impact on liquidity, Intelsat's SGL-3 liquidity rating
(indicating adequate liquidity) is also unchanged.

The following summarizes Moody's ratings and the rating actions
for Intelsat:

Assignments:

  Issuer: Intelsat Jackson Holdings S.A.

    Senior Unsecured Regular Bond/Debenture, Assigned Caa2
    (LGD4,69%)

Other Ratings:

  Issuer: Intelsat S.A.

    Corporate Family Rating, Unchanged at Caa1

    Probability of Default Rating, Unchanged at Caa1

    Speculative Grade Liquidity Rating, Unchanged at SGL-3

    Outlook, Unchanged at Stable

    Senior Unsecured Regular Bond/Debenture, Unchanged at Caa3
    (LGD6, 96%)

  Issuer: Intelsat (Luxembourg) S.A.

    Senior Unsecured Regular Bond/Debenture, Unchanged at Caa3
    (LGD5, 85%)

  Issuer: Intelsat Jackson Holdings S.A.

    Senior Secured Bank Credit Facility, Unchanged at B1 (LGD1,
    7%)

    Senior Unsecured Regular Bond/Debenture, Unchanged at B3
    (LGD3, 41%)

    Senior Unsecured Regular Bond/Debenture, Unchanged at Caa2
    (LGD4, 69%), rating re unsecured un-guaranteed notes due June
    15, 2016 to be withdrawn in due course

Ratings Rationale

Intelsat's Caa1 CFR is influenced primarily by concerns that the
company's capital structure may not be sustainable over a
prolonged period. Financial leverage is elevated (LTM Debt-to-
EBITDA at June 30, 2012, incorporating Moody's standard
adjustments, is 8.4x) as a consequence of debt-financed ownership
changes and significant capital expenditures, and it is not clear
that the EBITDA stream is large enough -- or can grow
sufficiently in a reasonable time frame -- to fund all of
operating costs, interest expense, cash taxes, and capital
expenditures. This background also serves to highlight the very
important role that the company's liquidity arrangements play.
With persistent negative/weak free cash generation, having the
resources to address FCF shortfalls without jeopardizing overall
financing arrangements is crucial, as is the ability to refinance
debts as they come due. The company's strong business profile
supports the rating. Key features are a large 50-plus satellite
fleet covering 99% of the globe's populated regions, growing
demand, and a stable contract-based revenue stream with a solid
$10.7 billion revenue backlog (over 4 years of revenue) booked
with well-regarded customers.

Rating Outlook

The ratings outlook is stable. With modest EBITDA growth and
liquidity sufficient to fund the next several quarters, downwards
pressure is manageable. However, until positive free cash flow
can be anticipated to be sustained, upwards ratings momentum is
limited.

What Could Change the Rating - UP

A ratings upgrade is not expected until Intelsat can substantiate
the ability to be cash flow self-sustaining. Given the current
debt load, this should be observed when EBITDA approaches $2.4
billion and Debt/EBITDA approaches and then falls below 6.5x.
Upon this milestone being observed/anticipated and supported by
trends that are expected to be sustained, and presuming solid
liquidity arrangements, upwards rating pressure would result.

What Could Change the Rating - DOWN

In the near term, Intelsat's rating is tied to its liquidity
arrangements; they will provide the initial warnings of the
company's plan coming under stress. In this regard financial
covenants (and restricted payment baskets) will be key. Should
applicable cushions be permanently eroded, downwards ratings
actions may be required.

The principal methodology used in rating Intelsat S.A. was the
Global Communications Infrastructure Industry Methodology
published in June 2011. Other methodologies used include Loss
Given Default for Speculative-Grade Non-Financial Companies in
the U.S., Canada and EMEA published in June 2009.



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


EURO-GALAXY II: S&P Lowers Rating on Class E Notes to 'CCC+'
------------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on Euro-Galaxy II CLO B.V.'s outstanding EUR405.78
million rated notes.

Specifically, S&P has:

-- raised its ratings on the class A, B, and C notes;
-- affirmed its rating on the class D notes; and
-- lowered its rating on the class E notes.

"The rating actions follow our credit and cash flow analysis, to
assess the transaction's performance since our previous review on
May 19, 2011," S&P said.

Since S&P's previous review, the transaction has benefited from:

-- reduced time to maturity of the rated notes, and
-- increased performing portfolio weighted-average spread to
    3.94% from 3.02%.

"We have subjected the rated notes to various cash flow
scenarios, incorporating different default patterns, as well as
interest rate curves, to determine each tranche's break-even
default rate at each rating level," S&P said.

"Following the developments in maturity and spread, and in light
of our credit and cash flow analysis, we consider that the credit
enhancement available to the class A, B, and C notes are now
commensurate with higher ratings than we previously assigned.
Accordingly, we have raised our ratings on these classes of notes
to 'AA+ (sf)', 'AA- (sf)', and 'BBB+ (sf)'," S&P said.

"Our credit and cash flow analysis indicates that the credit
enhancement available to the class D notes remains commensurate
with our current rating. Accordingly, we have affirmed our 'BB+
(sf)' rating on this class of notes," S&P said.

"Our rating on the class E notes is constrained by the
application of our largest obligor default test. Therefore, we
have lowered our rating on the class E notes to 'CCC+(sf)'," S&P
said.

"Morgan Stanley & Co. International PLC (A/Negative/A-1)
currently provides currency hedging on approximately 10% of the
transaction's collateral. We consider that the exposure to Morgan
Stanley & Co. International is sufficiently limited so that the
counterparty's failure to perform would not affect our ratings on
class A and B notes. In our opinion, Morgan Stanley & Co.
International is adequately rated to support our ratings on class
C, D, and E notes," S&P said.

Euro-Galaxy II CLO is a cash flow collateralized loan obligation
(CLO) transaction that closed in August 2007. The portfolio of
loans to speculative-grade European and U.S. corporate firms is
managed by Pinebridge Investments Europe Ltd.

RATINGS LIST

Class            Rating
            To            From

Euro-Galaxy II CLO B.V.
EUR415 Million Senior Secured Floating-Rate Notes

Ratings Raised

A           AA+ (sf)      AA (sf)
B           AA- (sf)      A (sf)
C           BBB+ (sf)     BBB (sf)

Ratings Affirmed

D           BB+ (sf)

Rating Lowered

E           CCC+ (sf)     B+ (sf)


GRESHAM CAPITAL III: S&P Raises Rating on Class E Notes to 'BB-'
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
Gresham Capital CLO III B.V.'s class A-2, B, C, D, and E notes.
"At the same time, we affirmed our ratings on the class A-1E, A-
1S, A-1R and F notes," S&P said.

"The rating actions follow our assessment of a mixed performance
of the underlying assets in the portfolio. We have also applied
our 2012 counterparty criteria," S&P said.

"Since our previous review of the transaction in June 2011, we
have observed a slight deterioration in the credit quality of the
underlying assets in the portfolio, which comprises loans to
primarily speculative-grade corporate obligors," S&P said.

"Our analysis indicates that the proportion of loans rated in the
'CCC' category has increased to 8.95% from 5.93%. Since our
previous review, 2.65% of the portfolio now comprises defaulted
assets," S&P said.

At the same time, the aggregate collateral balance has decreased
by EUR11.7 million to EUR545.8 million from EUR557.5 million,
while the class A-1 notes have amortized by EUR11.4 million.

"However, we have also observed other positive developments in
our analysis. Since our previous review, the weighted-average
life (WAL) of the transaction has shortened to 4.3 years from 5.1
years, while the weighted-average spread (WAS) has increased to
3.6% from 3.2%. Weighted-average recovery rates have also
slightly improved. In our opinion, the shorter WAL, as well as
the increase in WAS and in WARRs compensate for the negative
rating migration of the performing assets," S&P said.

"In addition, the overall level of available credit enhancement
has increased for all classes of notes, except for the class F
notes -- for which we have observed a marginal decrease. In
particular, we note that the class E and F notes are now failing
their respective par value tests, which measure the level of
overcollateralization available. The class F notes have deferred
interest payments by an additional EUR500,000," S&P said.

"Following our cash flow analysis, we consider the level of
credit enhancement available to the class A-2, B, C, D, and E
notes to be commensurate with higher ratings. We have therefore
raised our ratings on these classes of notes," S&P said.

"We also consider that the level of credit enhancement available
to the class A-1E, A-1S, A-1R, and F notes is still commensurate
with the ratings that we have currently assigned. We have
therefore affirmed our ratings on these classes of notes," S&P
said.

"The class A-1R notes are revolving obligations and may be drawn
in various permitted currencies. They are currently drawn in
euros, British pound sterling, U.S. dollars, and Australian
dollars. All of the other classes of notes in the transaction are
either denominated in euros or sterling. Accordingly, the assets
purchased with the issuance proceeds or the drawings of the class
A-1R notes are denominated in various currencies. Of the
portfolio, 31% comprises non-euro-denominated assets," S&P said.

"To mitigate the risk of foreign-exchange-related losses, the
issuer has entered into currency options agreements with Barclays
Bank PLC(A+/Negative/A-1) as counterparty. Our analysis of the
derivative counterparty and its associated documentation under
our 2012 counterparty criteria indicates that, absent other
mitigants, it cannot support ratings on the notes that are higher
than 'AA- (sf)'. To assess the potential effect on our ratings,
we have assumed that the transaction does not benefit from the
currency options agreements. The application of this stress under
our 2012 counterparty criteria constrains our ratings on the
class A-1E, A-1R, and A-1S notes at 'AA+ (sf)' and it constrains
our rating on the class B notes at 'AA- (sf)'--all of which are
commensurate with our currently assigned ratings. Conversely, the
application of our 2012 counterparty criteria does not constrain
our ratings on the class C, D, E, and F notes because the swap
counterparty supports the current ratings on these classes of
notes," S&P said.

Gresham Capital CLO III is a cash flow corporate loan
collateralized loan obligation (CLO) transaction that securitizes
loans to primarily speculative-grade corporate borrowers. The
transaction closed in December 2006 and is managed by Investec
Bank PLC.

            STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

       http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class             Rating
            To              From

Gresham Capital CLO III B.V.
EUR540 Million, GBP41 Million Secured Floating-Rate Notes

Ratings Raised

A-2         AA (sf)         AA- (sf)
B           AA- (sf)        A+ (sf)
C           A (sf)          BBB+ (sf)
D           BBB (sf)        BB+ (sf)
E           BB- (sf)        B+ (sf)

Ratings Affirmed

A-1E        AA+ (sf)
A-1R        AA+ (sf)
A-1S        AA+ (sf)
F           B- (sf)


NIELSEN HOLDINGS: Moody's Rates US$800MM Sr. Unsecured Notes 'B2'
-----------------------------------------------------------------
Moody's Investors Service assigned a B2/LGD 5 rating to Nielsen
Holdings N.V.'s US$800 million senior unsecured notes due 2020.
The notes will be issued via Nielsen's subsidiaries, Nielsen
Finance LLC and Nielsen Finance Co.

Nielsen intends to use the net proceeds of the issuance to redeem
the outstanding US$308 million, 11.5% Senior Notes due 2016; and
to prepay the US$500 million, 8.5% senior secured term loan due
2017. The senior unsecured notes will be guaranteed by Nielsen
Company B.V., VNU Intermediate Holding B.V., Nielsen Holding and
Finance B.V. and, subject to certain exceptions, each of the
guarantor's wholly owned subsidiaries, to the extent that each
entity also provides a guarantee under the existing senior
secured credit facilities. Nielsen's Ba3 Corporate Family rating
(CFR) and all other ratings remain unchanged. The rating outlook
is positive.

Ratings Rationale

Nielsen's Ba3 CFR reflects Moody's view that the company enjoys
strong international business positions with high barriers to
entry. In addition, it is based on Moody's expectation that the
company can build on its track record to deliver continued solid
revenue growth and can thus leverage its cost base, optimized
over the last few years, to produce steady profit growth. In
addition, Moody's expects that the company will utilize free cash
flow generation to reduce debt further. However, the ratings also
reflect the company's still considerable leverage, the currently
more challenging operating environment in Nielsen's 'Buy'
division as well as exposure, particularly in the 'Watch'
division to a fast moving technological environment and a more
competitive landscape in faster growing markets (eg online).

The positive outlook is based on Moody's expectation that Nielsen
will maintain its positive operating momentum, translating into
continued mid single digit revenue growth, and will apply
discretionary cash flows to debt reduction so that Debt / EBITDA
(as measured by Moody's) moves towards 4x in 2013.

A ratio of Debt/EBITDA (as adjusted by Moody's) higher than 5.0x
and/or the absence of visible free cash flow generation would
result in downward ratings pressure.

Steady operational performance paired with de-leveraging such
that Debt /EBITDA (as adjusted by Moody's) is moving towards 4.0x
together with sustained meaningful free cash flow generation
would likely result in positive rating pressure.

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

Active in approximately 100 countries, with headquarters in
Diemen, The Netherlands and New York, USA, Nielsen Holdings N.V.
(Nielsen) is -- through its operating subsidiaries -- a global
information and measurement company with market leadership
positions and strong brands. Revenues for the six months to June
2012 reached US$ 2.7 billion and are reported under three
segments: 'Buy', 'Watch' and 'Expositions'.


PLAZA CENTERS: S&P Assigns 'B' Long-Term Corp. Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' long-term
corporate credit rating to the Netherlands-based company, Plaza
Centers N.V., which mainly concentrates on the development of
shopping malls in Central and Eastern Europe (CEE). The outlook
is stable.

"At the same time, we assigned a 'B' issue-level rating to the
proposed US$200 million issue of senior secured notes," S&P said.

"Standard & Poor's rating reflects our assessment of risks
inherent in Plaza Centers' business model, which is based on the
development of predominantly retail projects, up to fully
operational stages, when they are sold, realizing capital gains
and positive cash flows. Although debt leverage usually
diminishes at the end of each development cycle, we believe that
the company's liquidity management through the cycle presents a
major credit risk. We consider Plaza Centers' business risk
profile as 'weak,' based on its high sensitivity to economic and
credit cycles in its core commercial development business, as
well as due to a high geographical concentration on CEE. We
believe, however, that these factors are mitigated by the
company's long-term planning and cash management. During the past
three years of volatile credit markets, the company has
maintained high cash reserves of more than EUR200 million,
covering its maturities for up to two years. The successful asset
portfolio sale of its U.S.-based joint venture, EPN Group (of
which Plaza Centers' share was 22.7%) in 2012 contributed to the
current cash position of about EUR110 million. Following the
successful completion and start of operations in four projects in
2011, as well as their relatively high occupancy rates, we
believe that Plaza Centers now has realizable assets which should
allow it to moderate debt leverage and improve liquidity," S&P
said.

"In our opinion, Plaza Centers' financial risk profile is 'highly
leveraged,' driven mainly by the volatility of profitability and
cash flows during the development cycle," S&P said.

"In our base-case operating scenario for the next two years, we
assume that Plaza Centers will act to realize its current asset
portfolio in order to stabilize its liquidity position and
leverage levels," S&P said.

"We believe Plaza Centers will likely achieve aggregate profit of
EUR80 million-EUR100 million and EUR100 million-EUR130 million of
positive net cash flows upon asset realization (after asset
specific debt service) in the next two years," S&P said.

"In our base-case capital structure scenario, we assume that the
company will maintain its current leverage position of net debt
to debt and equity below 50%, which we consider as commensurate
with the current rating," S&P said.

"The stable outlook reflects our view that Plaza Centers' cash
flow visibility is better than in previous years, while the
recently signed agreement with bondholders should provide the
company with some protection from more aggressive dividend
distribution. According to our base-case scenario, the company
will likely maintain a ratio of adjusted net debt to debt and
equity of no more than 50%, which we consider as commensurate
with the current rating," S&P said.

"The rating is heavily influenced by our assessment of the
company's liquidity. We assume that despite some signs of
investor interest in buying some assets that the company holds,
this willingness and ability is conditional on financial markets.
We would consider taking negative rating action if we see no
improvement in operating cash flows in the short term, as
described in our base-case scenario, or if there is a rise in the
ratio of net debt to debt and equity to more than 50%," S&P said.

"We do not see an upgrade as likely in the near term based on the
current levels of debt leverage," S&P said.

"In addition, our rating surveillance will focus on consistency
of financial policies and debt leverage targets, not least due to
the influence of its major shareholder, Elbit Imaging," S&P said.


RHODIUM 1: S&P Cuts Rating on Class D Notes to 'CCC-'
-----------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on all of Rhodium 1
B.V.'s rated classes of notes.

"On March 19, 2012, we placed our ratings on the Rhodium 1's
class A, B, C, and D notes on CreditWatch negative following our
update to the criteria and assumptions we use to rate
collateralized debt obligations (CDOs) of structured finance
(structured finance) assets, which became effective on March 19,
2012," S&P said.

"The rating actions resolve these CreditWatch negative
placements. They follow the application of our criteria for CDOs
of structured finance assets, as well as our assessment of the
negative rating migration in the portfolio of performing assets
since our previous review on Feb. 18, 2011," S&P said.

"Neither the application of our largest obligor default test nor
our largest industry default test affected our ratings on the
notes. These are two supplemental stress tests that we introduced
in our criteria, which assess whether a tranche has sufficient
credit enhancement to withstand specified combinations of asset
defaults at each liability rating level. We have used the same
asset ratings as in Standard & Poor's CDO Evaluator model for the
supplemental tests," S&P said.

"We subjected the capital structure to a cash flow analysis based
on the updated methodology and assumptions as outlined by our
criteria, to determine the break-even default rate (BDR) for each
rated class at each rating level. At the same time, we conducted
an updated credit analysis based on our new assumptions to
determine the scenario default rate (SDR) at each rating level,"
S&P said.

"Following the application of our CDO of ABS criteria, the SDRs
have increased significantly and the assumed weighted-average
recoveries at each rating category have significantly decreased.
In our view, the fall in BDRs and the rise in SDRs indicate that
the current credit enhancement levels available to the class A,
B, C, and D notes are no longer commensurate with our previous
ratings on these notes," S&P said.

"As a result of these developments, we have lowered and removed
from CreditWatch negative our ratings on the class A, B, C, and D
notes," S&P said.

Rhodium 1 is a cash flow CDO of European mezzanine asset-backed
securities (ABS) that closed in May 2004. Cairn Capital Ltd.'s
management of the portfolio is limited to the sale of defaulted
or credit impaired assets.

            STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

       http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class            Rating
          To                 From

Rhodium 1 B.V.
EUR304. 4 Million Asset-Backed Floating-Rate Notes

Ratings Lowered and Removed From CreditWatch

A         AA+ (sf)           AAA (sf)/Watch Neg
B         BBB+ (sf)          AA- (sf)/Watch Neg
C         CCC+ (sf)          BBB- (sf)/Watch Neg
D         CCC- (sf)          CCC+ (sf)/Watch Neg


UPC HOLDING: Moody's Assigns 'B2' Rating to EUR600MM Sr. Notes
--------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to the EUR600
million Senior Notes due 2022 issued by UPC Holding BV. The
rating outlook is stable.

The bond proceeds will be used for general corporate purposes and
will increase UPC's covenant Total Debt to Annualized EBITDA
ratio by approximately 0.3x to 4.98x (from 4.66x at the end of
June 30, 2012) in the absence of re-financing of existing
indebtedness from some of the bond proceeds.

This transaction will increase Moody's adjusted gross debt/
EBITDA for UPC from 4.8x (on a last twelve months basis as of
June 30, 2012) to approximately 5.2x, and therefore leads to the
somewhat weak positioning of UPC's rating within the Ba3
category. Moody's notes that UPC's leverage incurrence covenant
headroom (as stipulated in the bond indentures) is fully utilized
with this debt issuance. The agency would expect UPC to de-
leverage with further EBITDA growth such that it can continue to
maintain adequate headroom under its financial covenants going
forward.

Ratings Rationale

The B2 rating on the Senior Notes reflects the fact that these
notes are structurally and contractually subordinated to the
senior secured bank credit facilities (tranches due between 2014-
2022) at UPC Broadband and to the senior secured notes (due 2020-
22) issued by trust-owned special purpose vehicles ('SPVs') --
UPCB Finance Limited, UPCB Finance II Limited, UPCB Finance III
Limited, UPCB Finance V Limited and UPCB Finance VI Limited. Like
existing senior notes, the new Notes are also secured against
pledge of shares of UPC. The senior secured debt of the group is
rated at Ba3, pari-passu with the group CFR while all existing
senior notes (due 2016-20) are rated B2.

After achieving revenue and operating cash flow (OCF) growth of
3% and 4% respectively on a re-based basis in 2011 (as calculated
by the company), UPC's revenues and OCF grew year-on-year by 3%
and 2% respectively in H1 2012. Revenue growth was largely
supported by UPC's operating performance in Western Europe (3.1%
re-based year-on-year growth in revenue in H1 2012), which
accounts for approximately 61% of the company's overall reported
revenues. Revenues derived from the Netherlands in H12012
increased by 4.2% year-on-year on a re-based basis; Switzerland
by 3.1%; and the rest of Western Europe by 1.3% during H12012.
Revenues in Chile in H12012 also grew strongly by 5.2% year-on-
year on a re-based basis. Overall OCF growth in Western Europe in
H1 2012 was 4.0% year-on-year on a rebased basis and OCF in Chile
also grew solidly by 7.1%. Performance in Eastern Europe on the
other hand, continued to remain weak with -0.3% and -1.3%
declines year-on-year in revenues and OCF respectively in H12012.
In line with UPC's expectation, Moody's would also expect the
company to improve its overall re-based OCF growth in H2 2012.

The agency acknowledges the ongoing macro-economic volatility in
the European region and the continued competition in most of
UPC's markets, going forward Moody's would expect the company's
operating performance in its key Western European markets and
Chile to continue to remain on a positive growth trend.

The current Ba3 corporate family rating reflects (i) UPC's
significant scale of operations and its geographical
diversification across European markets; (ii) its good operating
performance in Western Europe; and (iii) UPC's continued
adherence to its publicly stated financial policy of not
exceeding 5.0x Total Debt to EBITDA as enshrined in the terms and
conditions of its existing debt instruments.

However, the rating also takes into account the strong
competition in its countries of operations (notably in the CEE
region). Moody's ratings incorporate the fact that UPC is fully
controlled by LGI and pursues a strategy whereby it aims to keep
the leverage close to its stated leverage parameters thereby
continuing to maintain tight headroom under its financial
covenants (specifically headroom under the senior debt/
annualized EBITDA covenant ratio of less than 4.0x; this ratio
stood at 3.88x as of June 30, 2012 and pro-forma for the new
senior notes).

The stable outlook reflects Moody's expectation that the company
should continue to maintain good operating momentum while
managing towards its stated leverage target such that its
leverage does not remain materially above 5.0x Gross Debt to
EBITDA (as defined by Moody's) on a sustained basis.

What Could Change the Rating - UP

Positive ratings development would most likely result from
leverage decreasing and remaining solidly below 4.5x and moving
towards 4x on a Gross Debt to EBITDA (as adjusted by Moody's)
basis on the back of strong operating performance.

What Could Change the Rating - DOWN

Sustained weak operating performance in conjunction with an
increase in Gross Debt to EBITDA (as adjusted by Moody's) towards
5.5x could result in downward pressure. Furthermore weak
liquidity would put a downward pressure on the rating.

The principal methodology used in rating UPC Holding BV was the
Global Cable Television Industry Industry Methodology published
in July 2009. Other methodologies used include Loss Given Default
for Speculative-Grade Non-Financial Companies in the U.S., Canada
and EMEA published in June 2009.

UPC is a pan-European cable provider, a principal subsidiary of
Liberty Global Inc. In 2011, the company generated EUR4 billion
in revenue and EUR1.9 billion in reported operating cash flow.


WOOD STREET IV: S&P Raises Rating on Class D Notes to 'BB+'
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
Wood Street CLO IV B.V.'s class B, C, and D notes. "At the same
time, we have affirmed our ratings on the class A-1, A-2, and E
notes," S&P said.

"The rating actions follow our review of the transaction's
performance. We performed a credit and cash flow analysis and
assessed the support that each participant provides to the
transaction by applying our 2012 counterparty criteria. In our
analysis, we used data from the latest available trustee report
dated July 10, 2012," S&P said.

"We have subjected the capital structure to a cash flow analysis
to determine the break-even default rates for each rated class of
notes. In our analysis, we used the reported portfolio balance
that we considered to be performing (EUR529,301,181), the current
weighted-average spread (3.95%), and the weighted-average
recovery rates that we considered to be appropriate. We applied
various cash flow stress scenarios, using four different default
patterns, in conjunction with different interest rate stress
scenarios for each liability rating category," S&P said.

"From our analysis, 13.86% of the portfolio comprises non-euro-
denominated loans, which are hedged under cross-currency swap
agreements with various counterparties. In our opinion, the
downgrade remedies for these cross-currency swaps do not fully
comply with our 2012 counterparty criteria. Consequently, we have
considered in our cash flow analysis scenarios where the currency
swap counterparties do not perform and where, as a result, the
transaction is exposed to changes in currency rates," S&P said.

"In our analysis, we have also applied our nonsovereign ratings
criteria. We have considered the transaction's exposure to
sovereign risk because some of the portfolio's assets--equal to
12.05% of the transaction's total collateral balance--are based
in Spain (BBB+/Negative/A-2), Ireland (BBB+/Negative/A-2), and
Italy (unsolicited; BBB+/Negative/A-2). When applying stresses at
a 'AAA' rating level, we have given credit to 10% of the
transaction's collateral balance corresponding to assets based in
these sovereigns in our calculation of the aggregate collateral
balance," S&P said.

"In our credit and cash flow analysis, we have taken into account
the transaction's exposure to currency exchange and sovereign
risk, which indicates that the level of credit enhancement
available to the class A-1 notes is still commensurate with our
rating on these notes. We have therefore affirmed our 'AAA (sf)'
rating on the class A-1 notes," S&P said.

"At the same time, we have affirmed our 'AA+ (sf)' rating on the
class A-2 notes because our credit and cash flow analysis of the
transaction's exposure to currency exchange risk indicates that
the level of credit enhancement available to these notes is
commensurate with our current rating on these notes. In addition,
our nonsovereign ratings criteria permit a maximum potential six-
notch uplift between the ratings on the countries in which the
assets are based and our rating on the notes. As a result, the
transaction's exposure to 'BBB+' rated eurozone sovereigns does
not constrain our 'AA+ (sf)' rating on the class A-2 notes under
our criteria. We have therefore not applied any additional
stresses in our cash flow analysis of the class A-2 notes," S&P
said.

"Based on our credit and cash flow analysis, we consider the
level of credit enhancement available to the class B, C, and D
notes to be consistent with higher ratings than we previously
assigned. We have therefore raised our ratings on these classes
of notes. The current ratings of the cross-currency swap
counterparties are sufficient to support the higher ratings on
the class B, C, and D notes," S&P said.

"The ratings on the class C, D, and E notes are constrained by
the application of the largest obligor default test, a
supplemental stress test that we introduced in our 2009 criteria
update for corporate collateralized debt obligations (CDOs). We
have therefore affirmed our rating on the class E notes as the
rating on these notes is at the level at which it is constrained
by the largest obligor default test," S&P said.

Wood Street CLO IV B.V. is a managed cash flow collateralized
loan obligation (CLO) transaction that securitizes loans to
primarily European speculative-grade corporate firms. The
transaction closed in January 2007 and is managed by Alcentra
Ltd.

            STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

       http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class         Rating
         To              From

Wood Street CLO IV B.V.
EUR557 Million Senior Secured and Deferrable Floating- Rate Notes

Ratings Raised

B        AA- (sf)        A (sf)
C        BBB+ (sf)       BB+ (sf)
D        BB+ (sf)        BB (sf)

Ratings Affirmed

A-1      AAA (sf)
A-2      AA+ (sf)
E        B+ (sf)


ZOO ABS II: S&P Lowers Rating on Class E Notes to 'CCC'
-------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions in ZOO ABS II B.V.

Specifically, S&P has:

-- Lowered and removed from CreditWatch negative its ratings on
    the class A-1, A-2, B, C, D, and E notes;

-- Affirmed and removed from CreditWatch negative its rating on
    the class X notes; and

-- Withdrawn its rating on class A-1D notes.

"On March 19, 2012, we placed on CreditWatch negative our ratings
on the class X, A-1D, A-1, A-2, B, C, D, and E notes in this
transaction," S&P said.

"This followed our update to the methodology and assumptions we
use to rate CDOs of SF assets, which became effective on March
19, 2012," S&P said.

"The rating actions resolve these CreditWatch negative
placements. We have reviewed the transaction's performance since
our previous full review (on July 5, 2011), and have performed a
credit and cash flow analysis using the latest available data
(from the trustee report dated July 30, 2012). We have applied
our 2012 CDO of SF criteria and 2009 corporate cash flow CDO
criteria, as well as our counterparty criteria, which became
effective on May 31, 2012," S&P said.

"The proportion of assets in the collateral pool that we consider
to be rated in the 'CCC' category ('CCC+', 'CCC', or 'CCC-') has
decreased since our July 2011 review. At the same time, the
proportion of assets that we consider to be defaulted (rated
'CC', 'SD' [selective default], or 'D') has increased. The
reference collateral pool is concentrated among six industries
and ten countries," S&P said.

"The class X and class A-1 notes have partially amortized since
our July 2011 review. However, further capitalization of interest
on class E deferrable notes has increased their outstanding
balance. The class D and E notes continue to breach the
transaction's overcollateralization test triggers," S&P said.

"We have subjected the transaction's capital structure to our
cash flow analysis, based on the methodology and assumptions
outlined in our 2012 CDO of SF criteria and 2009 corporate cash
flow CDO criteria, to determine the break-even default rate
(BDR). We used the reported collateral pool balance that we
considered to be performing, the principal cash balance, the
current weighted-average spread, and the weighted-average
recovery rates (WARRs) that we considered to be appropriate. We
incorporated various cash flow stress scenarios using various
default patterns, levels, and timings for each liability rating
category, in conjunction with different interest rate stress
scenarios," S&P said.

"Following the application of our 2012 CDO of SF criteria
criteria, the WARR modeled in our cash flow analysis has
significantly reduced at each rating level. For example, the WARR
calculated at the 'AAA' rating level has reduced to 4.25% from
30.21% at our July 2011 review. This--combined with various
default patterns and relatively low weighted-average spread to
cover payments on the capital structure--has reduced the level of
defaults that all rated classes of notes can withstand in our
analysis, which in turn has decreased BDRs for these classes of
notes," S&P said.

"We have determined the scenario default rate (SDR) for each
rated class of notes. We have done this by using Standard &
Poor's CDO Evaluator 6.0.1 model to determine the default rate
expected on the underlying collateral pool at each rating level.
The SDRs at the 'AAA' rating level have increased since our July
2011 review, based on the updated assumptions in our 2012 CDO of
SF criteria and negative ratings migration of the collateral
pool," S&P said.

"We have tested the transaction's capital structure by applying
the largest obligor default test as outlined in our 2012 CDO of
SF criteria. None of our ratings in this transaction is affected
by our evaluation of the supplemental stress test results," S&P
said.

"Following the application of our 2012 CDO of SF criteria, we now
consider the credit enhancement levels available to all classes
of notes in this transaction, except the class X notes, to be
commensurate with lower rating levels than we previously
assigned. We have therefore lowered and removed from CreditWatch
negative our ratings on the class A-1, A-2, B, C, D, and E
notes," S&P said.

"The class X notes have, however, a very small outstanding
balance with a significant amount of credit enhancement, which we
consider to be commensurate with the current 'AAA' rating level.
Hence, we have affirmed and removed from CreditWatch negative our
'AAA (sf)' rating on the class X notes," S&P said.

"At the end of 2011, the class A-1D notes merged into the class
A-1 notes. As this has reduced the class A-1D note balance to
zero, we have withdrawn our rating on the class A-1D notes," S&P
said.

RATINGS LIST

Class          Rating                Rating
               To                    From

ZOO ABS II B.V.
EUR255. 5 Million Senior Delayed Drawdown and Deferrable-Interest
Secured Floating-Rate Notes

Ratings Lowered and Removed From CreditWatch Negative

A-1            BBB- (sf)              AA- (sf)/Watch Neg
A-2            BB- (sf)               BBB+ (sf)/Watch Neg
B              B (sf)                 BBB- (sf)/Watch Neg
C              B (sf)                 BB+ (sf)/Watch Neg
D              CCC+ (sf)              B+ (sf)/Watch Neg
E              CCC (sf)               B- (sf)/Watch Neg

Rating Affirmed and Removed From CreditWatch Negative

X              AAA (sf)               AAA (sf)/Watch Neg

Rating Withdrawn

A-1D           NR                     AA- (sf)/Watch Neg



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


KRAYINVESTBANK: Fitch Affirms 'B+' Issuer Default Rating
--------------------------------------------------------
Fitch Ratings has affirmed Krasnodar-based Krayinvestbank's (KIB)
Long-term Issuer Default Rating (IDR) at 'B+' with a Stable
Outlook.

RATING ACTION RATIONALE AND DRIVERS: IDRs and SUPPORT RATING

KIB's '4' Support Rating and 'B+' IDR reflects the limited
probability of support that KIB may receive if needed from
Krasnodar Region (KR, 'BB+'/Stable), which directly owns a 97.05%
stake in the bank.  Fitch's view of the propensity to provide
support is based on KR's majority ownership and a track record of
assistance to date, including issuance of guarantees for the
bank's borrowings, indirect liquidity support (through local
government-owned entities which account for 25% of end-2011
customer funding), as well as provision of capital, including
RUB1.5bn contributed in June 2012 and the planned RUB1bn equity
injection expected in H113.

At the same time, Fitch considers there is some uncertainty in
respect of support in light of the bank's limited systemic
importance for the region and some corporate governance issues.
In particular, Fitch is concerned about KIB's significant
exposure to construction and real estate (roughly 2.2x of end-
2011 Fitch core capital ;FCC) which, in the agency's opinion, may
largely be related in some way to officials within the current
regional administration and/or the bank's management.

RATING ACTION RATIONALE AND DRIVERS: VIABILITY RATING (VR)

KIB's VR reflects the bank's small size by international
standards; significant concentrations, particularly high exposure
to construction and real estate; potentially vulnerable asset
quality; modest profitability (with ROAE of 4.3% in 2011); and
tightly managed capital.  However, on the positive side, the VR
factors in KIB's so far limited reliance on wholesale funding,
good deposit collection capacity and broad regional presence.

Although reported loans overdue by 90 days (non-performing loans;
NPLs) were a moderate 5.9% at end-2011 and are 94% covered with
loan impairment reserves (LIR), underlying asset quality may be
masked by significant rolled-over loans (15% of end-2011 loans).
Fitch's review of KIB's 20 largest exposures (accounting for
roughly 50% of end-2011 loans) revealed that most of KIB's
working capital exposures are extended to borrowers that have a
poor financial standing.  KIB's construction exposures, in
addition to the loan book, are structured through bonds (0.7x of
end-2011 FCC) and investments in mutual funds (0.5x) and are of
particular concern to the agency.  Some of the properties are at
an initial stage of construction and the valuation of collateral
is rather aggressive in most cases, although reported LTVs for
construction loans are moderate.

The medium- to long-term construction exposures result in poor
liquidity of the balance sheet, while the liquidity cushion
(largely in the form of cash) equals only 12% of end-2011
liabilities.  As a moderate mitigating factor, KIB's customer
funding (87% of end-H112 liabilities) is relatively stable with a
high share of granular retail deposits (50% of end-H112
liabilities) and so far sticky on demand funding from state-
controlled entities (roughly 25%).  The latter helps to ease
pressure on KIB's cost of funding (5.4% in 2011), although the
bottom line is significantly dampened by a high cost/income ratio
(72% in 2011) and impairment charges (74% of 2011 pre-impairment
profit).

As a result, KIB's performance remains weak and its internal
capital generating capacity is insufficient to maintain the
budgeted 30%-40% annual growth, which the bank plans to partially
fund by domestic bond issuance, significantly increasing so far
low refinancing risk.  KR plans to inject an additional RUB1bn of
equity into the bank in H113, but this is expected to only result
in a temporary improvement in capitalization.  KIB's current
capital buffer (with the regulatory capital adequacy ratio of
13.5% at end-H112) is sufficient to withstand additional losses
equal to only 9% of loans, which is considered low by Fitch,
given significant risks stemming from construction exposures and
sizeable single borrower concentrations.

RATING SENSITIVITIES: IDRs AND SUPPORT RATING

Downside pressure on KIB's Long-Term IDR, Support Rating and SRF
could arise from any major weakening in the relationship between
the KR and the bank, for example, as a result of changes in key
senior regional officials (not Fitch's base case expectation at
the moment as KR's governor has recently been reappointed).

KIB's Long-Term IDR is unlikely to be upgraded in the near term
due to current uncertainties about the reliability of support.

RATING SENSITIVITIES: VR

Downside pressure on KIB's VR could result from any further
marked increase in the bank's construction exposure or sharp
deterioration in asset quality, liquidity or capital. Limited
progress in the medium term with completion of construction
projects currently being financed could also be negative for the
rating.

KIB's VR is unlikely to be upgraded in the near term, however
moderation of growth plans, an improvement in performance and
greater diversification of KIB's loan book would be credit
positive.

The rating actions are as follows:

  -- Long-term foreign-currency IDR: affirmed at 'B+'; Outlook
     Stable

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

  -- Long-term local-currency IDR: affirmed at 'B+'; Outlook
     Stable

  -- National long-term Rating: affirmed at 'A-(rus)'; Outlook
     Stable

  -- Viability Rating: affirmed at 'b-'

  -- Support Rating: affirmed at '4'

  -- Senior unsecured debt: assigned 'B+'; Recovery Rating:
     assigned 'RR4'


* SMOLENSK REGION: Fitch Assigns 'B+/B' Currency Ratings
--------------------------------------------------------
Fitch Ratings has assigned Russia's Smolensk Region Long-term
foreign and local currency ratings of 'B+', a Short-term foreign
currency rating of 'B' and a National Long-term rating of 'A-
(rus)'.  The Outlooks for the Long-term ratings are Stable.

The ratings reflect the region's weak budgetary performance
during the past four years, high refinancing risk stemming from
the short-term nature of its debt and modest economy.  However,
the ratings also factor in the agency's expectation of a gradual
improvement in the region's budgetary performance in 2012-2014, a
moderate, albeit increasing level of direct risk and low
contingent liabilities.

Fitch notes that if the region sustains a positive operating
balance above 6% of operating revenue in the two consequent
years, and improved the debt coverage ratio (direct risk to
current balance) to below ten years, the ratings could be
upgraded.  Conversely, continuation of poor budgetary performance
with operating balance below Fitch's expectation, accompanied by
high refinancing risk would lead to a downgrade.

Fitch expects the region's operating performance to improve in
2012 with the operating balance likely to become positive.
However it remains weak and stays about 2% of operating revenue.
In 2013-2014 operating balance will also remain low averaging
about 2%-3% of operating revenue.  Debt coverage ratio will
exceed 50 years, which is significantly higher than the region's
debt maturity profile.

The region has historically demonstrated weak budgetary
performance with negative operating balance in 2008-2011.  This
demonstrates the regional administration's inability to balance
its operating revenue and expenditure.  Operating balance
improved in 2011, but still remained negative at 0.6% of
operating revenue (negative 4.9% in 2010).

The region recorded high deficits of 16.3% and 15.2% to total
revenue in 2010 and 2011, respectively, which led to a material
increase in direct risk to RUB11.3 billion (45.7% of current
revenue), albeit from a low level.  Fitch expects the region's
direct risk to increase to about RUB18.2 billion (56% of current
revenue) by end-2014.

The debt structure is dominated by short-term bank loans: 58% of
direct risk in 2011, which leads to needing bank loans
refinancing every year.  The proportion of short-term liabilities
is expected to increase in 2012-2014.  Combined with the weak
debt coverage ratio, this will put significant refinancing
pressure to the region's budget.

Smolensk's economy is historically weaker than the average
Russian region.  Its per capita gross regional product was about
42% lower than the national average in 2010.  The region has
relatively weak tax capacity and current federal transfers
constitute a significant proportion of current revenue (about 32%
in 2011).  However, federal transfers act as a stabilizer during
recessions, making the region less vulnerable to negative
external pressures.

Smolensk region is located in the west of European Russia,
bordering with Belorussia.  The region's capital, the city of
Smolensk, is about 400 km from Moscow.  The region contributed
0.4% of the Russian Federation's GDP in 2010 and accounted for
0.7% of the country's population.



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


FRUMOLY: Goes Into Liquidation
------------------------------
Murciaeconomia.com reports that the citrus exporter company
Frumoly SL, owned by the Molina Zambudio family, has not been
able to overcome the competition of creditors and has gone into
liquidation.

Murciaeconomia.com says the head of the Commercial Court number 1
of Murcia has agreed to suspend the powers of administration and
has appointed the liquidators of the company.

Located in Cabezo de Torres, Frumoly SL presented in 2009 a
turnover of EUR1.9 million and had a staff of 30 employees. In
2010, its turnover increased to EUR2.4 million,
Murciaeconomia.com discloses.


OPDE US: Unit of Spanish Solar Firms Files for Chapter 7
--------------------------------------------------------
Melanie Turner, writing for the Sacramento Business Journal,
reports that OPDE U.S. Corp., the West Sacramento-based U.S.
subsidiary of a Spanish solar company, filed for Chapter 7
bankruptcy on Sept. 5 after failing to find a buyer for the solar
power it planned to produce.  The report says the Company, which
has recently closed its doors, listed fewer than 50 creditors,
between $100,000 and $500,000 in assets and between $1 million
and $10 million in liabilities, according to court documents
filed in U.S. Bankruptcy Court for the Eastern District of
California in Sacramento.  The report notes OPDE U.S. several
years ago planned to build a 20-megawatt power plant on Port of
West Sacramento property.


TDA IBERCAJA: S&P Affirms 'D' Rating on Class B Notes
-----------------------------------------------------
Standard & Poor's Ratings Services lowered to 'A- (sf)' from 'AA
(sf)' and removed from CreditWatch negative its credit rating on
TDA IBERCAJA ICO-FTVPO, Fondo de Titulizacion Hipotecaria's class
A(G) notes. "We have also affirmed our 'D (sf)' rating on the
class B notes," S&P said.

"On Feb. 23, 2012, we placed on CreditWatch negative our rating
on TDA IBERCAJA ICO-FTVPO's class A(G) notes, due to its
substantial support exposure to Banco Santander S.A. (acting as
swap and reinvestment account provider), which followed our Feb.
13, 2012 downgrade of Banco Santander," S&P said.

"We again lowered our ratings on Banco Santander to A-
/Negative/A-2 on April 30, 2012 and, as a consequence, the remedy
period started for both the swap and the reinvestment contracts,"
S&P said.

"More than 60 days have elapsed without remedy actions being
taken since we lowered our short-term rating on Banco Santander
to below the level required by the transaction documents," S&P
said.

"Consequently, due to the lack of remedy actions, under our 2012
counterparty criteria, there is a direct link between our ratings
in this transaction and our long-term issuer credit rating (ICR)
on the swap provider, which is also the reinvestment account
provider. Without the benefit of the swap agreement, the notes
would achieve a lower rating than they can current achieve.
Furthermore, the rating of the notes cannot be delinked from
the rating of the reinvestment account provider. We have
therefore lowered and removed from CreditWatch negative our
rating on the class A(G) notes in this transaction. This rating
is now commensurate with our 'A-' long-term ICR on Banco
Santander," S&P said.

"We have also affirmed our 'D (sf)' rating on the class B notes
as this class of notes, which at closing funded the reserve fund,
is still in default as of the Aug. 27, 2012 payment date," S&P
said.

"The transaction's credit performance has been strong, in our
view, given the nature of the product securitized (80% of the
pool comprises subsidized loans, which benefit from low monthly
installments and if they defaulted, they would no longer be
subsidized by the Spanish government). Based on the latest
available investor report from the trustee (dated July 2012), the
level of loans in arrears for 90+ days is at 0.07% of the
outstanding balance, and 0.08% of the pool is in default (these
defaulted loans  are not subsidized)," S&P said.

"TDA IBERCAJA ICO-FTVPO is a Spanish residential mortgage-backed
securities (RMBS) transaction, backed mostly by subsidized
mortgage loans originated by Ibercaja Banco S.A. under the ICO-
FTVPO subsidy program. Under this program, the Spanish Ministry
of Housing and local authorities give borrowers the ability to
buy a first residential property, which, due to their economic
situation, they might not be able to afford without this subsidy.
The subsidy for this type of borrower is two-fold: The subsidized
(Vivienda de Proteccin Oficial) properties are cheaper than
those on the free market, and the Spanish Ministry of Housing
pays to the originator up to 40% of the installment on the
borrower's behalf. TDA IBERCAJA ICO-FTVPO closed in July 2009 and
the current
pool factor is 78.55%," S&P said.

            STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

       http://standardandpoorsdisclosure-17g7.com



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


SCHMOLZ BICKENBACH: S&P Lowers Corporate Credit Rating to 'B'
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'B' from 'B+' its
long-term corporate credit rating on Switzerland-headquartered
specialty long steel producer Schmolz + Bickenbach AG. The
outlook is stable.

"We also lowered the issue rating on the company's EUR258 million
senior secured bond to 'B' from 'B+'. The recovery rating on this
instrument is unchanged at '3', indicating our expectation of
meaningful (50%-70%) recovery in the event of a payment default,"
S&P said.

"The downgrade reflects our lower forecasts for Schmolz +
Bickenbach's 2012-2013 EBITDA, based on the company's weak
performance in the second quarter of 2012, and our expectation of
lackluster economic conditions in Europe, including a weakening
steel and automotive industry. We therefore expect Schmolz +
Bickenbach's credit ratios to weaken below our guidance for a
'B+' rating over the next six to 12 months," S&P said.

"The company's second-quarter 2012 performance was weaker than we
previously forecast in May 2012, when we assigned the rating.
Over that period, Schmolz + Bickenbach posted EBITDA of EUR53
million, down 55% year-on-year. Based on our downward revision of
our EBITDA forecast for the rest of 2012 and 2013, we project
that the company will generate EBITDA of about EUR200 million in
2012, down from the EUR270 million we forecast in May. As a
result, we now expect Schmolz + Bickenbach's Standard & Poor's-
adjusted debt to EBITDA to rise to about 6x in 2012, compared
with 4.1x in 2011," S&P said.

"We also view negatively the abrupt departure of the company's
chief executive and financial officers in June 2012, although we
understand the decision primarily reflected a reorientation in
corporate management set by the board of directors. The company's
current priority is to recruit a permanent management team,
although interim management has extensive experience," S&P said.

"We also take into account our view of the increased risk of a
covenant breach over the coming quarters. Under our revised base-
case scenario, for instance, unadjusted net debt to EBITDA will
exceed the 4.0x covenant limit by year-end 2012. We note that the
company's leverage calculation for covenant purposes may be
different to ours as it allows for some adjustments that we do
not include in our estimates. We nevertheless expect management
to take proactive actions to reset the covenants in advance if
needed, and believe that the company's core banks will remain
supportive as demonstrated by a covenant reset implemented
earlier this year," S&P said.

"The stable outlook reflects our expectation that Schmolz +
Bickenbach will maintain a broadly stable debt level in 2012,
despite challenging economic and industrial conditions in Europe.
The ratings factor in our expectation of weak EBITDA levels in
2012 and a deterioration in leverage ratios. We see adjusted
debt to EBITDA of 4.0x-6.0x (5.0x on average) throughout the
company's business cycle as commensurate with the current rating
level. It also reflects our expectation that the company will
proactively manage its covenant breach risk by resetting the
ratios in a timely manner if needed, and with the support of its
core banks," S&P said.

"We would consider taking a negative rating action if liquidity
came under pressure, particularly if the company were unable to
reset its covenants in a timely manner to prevent a breach and/or
if we perceived weakening bank support. Adjusted debt to EBITDA
above 6x without near-term prospects of recovery, as well as a
protracted permanent management vacancy, could also trigger a
negative rating action," S&P said.

"Rating upside would depend on sustainably improved covenant
headroom and adjusted debt to EBITDA ratios averaging 4x over the
business cycle. That said, we think this is unlikely over the
next 18 months, given the challenging economic environment," S&P
said.



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


PJSC BANK: Fitch Junks Long-Term Issuer Default Rating
------------------------------------------------------
Fitch Ratings has downgraded Ukraine-based PJSC Bank Forum's
Long-term foreign-currency Issuer Default Rating (IDR) to 'CC'
from 'B' and downgraded its Long-term local-currency IDR to 'CC'
from 'B+'.  Both ratings have been removed from Rating Watch
Negative (RWN).

RATING ACTION RATIONALE AND DRIVERS: IDR, SUPPORT RATING,
NATIONAL RATING AND DEBT RATING

The equalization of Forum's Long-term IDRs with its Viability
Rating (VR) reflects Fitch's view that external support for the
bank cannot be relied upon following the agreement reached by the
current major shareholder, Commerzbank AG ('A+'/Stable) to sell a
96% stake in Forum to the Ukrainian-based Smart Holding.

Fitch understands that Commerzbank has no contractual commitment
or intention to provide assistance to Forum following the deal
completion, although the provision of limited liquidity support
is possible prior to the sale being completed.  Fitch views the
support from Smart Holding as possible, but does not factor this
into Forum's ratings due to the limited visibility of the group's
overall financial position, and the absence of any capital
support for the bank to date.  However, the agency welcomes the
fact that Smart has placed some funding with the bank. Fitch is
informed that the sale is likely to be finalized by end-October
2012, subject to regulatory approvals.

RATING ACTION RATIONALE AND DRIVERS: VIABILITY RATING
Forum's 'cc' VR primarily reflects the bank's highly impaired
loan book, its moderate impairment coverage and as a result its
vulnerable capital position, and its negative pre-impairment
performance.  However, the rating also considers some recent
stabilization of the bank's deposit base and liquidity position
after earlier outflows.

Non-performing loans (NPLs) were a very high 65% at end-August
2012 and restructured loans comprised a further 15% of the
portfolio.  Impairment reserves in the statutory accounts
provided only 42% coverage of combined NPLs and restructured
loans, with the unreserved part equal to about 3x equity.  The
pre-impairment result for 8M12 was marginally negative, while
published net income was close to zero due a negative tax charge,
supporting the regulatory capital ratio at 20.7% at end-August
2012.  The short open currency position, which stood at US$200
million (equivalent of 1.1x statutory equity) at end-August 2012
also exposes the bank to significant risk of further capital
erosion in the case of UAH devaluation.

There are currently no plans to inject capital into the bank, as
the new shareholder believes Forum is adequately capitalized.
Conversion of an outstanding US$50 million subordinated facility
into equity may be contemplated in case of losses resulting from
a UAH devaluation, but this is likely to provide only moderate
capital relief, in Fitch's view.

Forum's liquidity position has been manageable in recent weeks,
with moderate retail deposit outflow largely compensated by
corporate funds attracted from Forum's new shareholder.  At end-
August 2012, Fitch calculates that liquid assets, net of short-
term interbank liabilities, were equal to 13% of customer
funding. However, the agency believes that further outflows of
retail, corporate and bank funding remain possible prior to and
following the completion of the bank's sale, possibly
necessitating further placements from the shareholder and/or
liquidity support from the National Bank of Ukraine (NBU).

According to publicly available information, Smart Holding
combines various investments in metallurgy, oil and gas,
agriculture and real estate, with the main asset being a 24%
equity stake in METINVEST BV (IDR: 'B'/Stable).  Fitch estimates
that this investment alone could have generated USD220m of
dividend income in 2011.  However, the agency currently does not
have audited information on the holding's current overall
leverage and debt levels.

Rating Sensitivities

A recapitalization of the bank by the new shareholder, or
tangible and material progress with successful work-outs of
problem loans, could result in a rating upgrade.  Rapid funding
outflows, without offsetting placements by the shareholder or the
NBU, could undermine the bank's liquidity and threaten its
ability to service its obligations, resulting in a further
downgrade.

The rating actions are as follows:

  -- Long-term foreign currency IDR: downgraded to 'CC' from
     'B';
     Removed from RWN
  -- Long-term local currency IDR: downgraded to 'CC' from 'B+';
     Removed from RWN
  -- Short-term foreign currency IDR: downgraded to 'C' from 'B';
     Removed from RWN
  -- Support Rating: downgraded to '5' from '4'; Removed from RWN
  -- Viability Rating: affirmed at 'cc' ; Removed from RWN
  -- National Long-term Rating: downgraded to 'B(ukr)' from 'AA+
    (ukr)'; Removed from RWN
  -- Senior unsecured: downgraded to 'B(ukr)' from 'AA+(ukr)';
     Removed from RWN



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


HAWTHORNES OF NOTTINGHAM: Faces Creditors' Voluntary Liquidation
----------------------------------------------------------------
Simon Nias at PrintWeek reports that Hawthornes of Nottingham
looks set for liquidation after a meeting of creditors was
scheduled for September 24 by KPMG following instruction from the
company's directors.

A letter from KPMG director Chris Pole -- a copy of which has
been seen by PrintWeek -- was sent to Hawthornes' creditors last
week to schedule the meeting on September 24 at KPMG's Park Row
office in Nottingham

PrintWeek relates that the letter stated the directors of the
117-year-old printer "having regard to its financial position"
decided to commence proceedings to place the company into
creditors' voluntary liquidation.

Hawthornes production director Tony Fellows, who was promoted to
the board in August 2010, told PrintWeek that the company would
release a statement through KPMG following the meeting of
creditors but would not otherwise comment.

PrintWeek, citing Hawthorne's latest filed accounts for the year
ended March 31, 2011, discloses that the company made a pre-tax
loss of GBP119,210 on turnover of GBP6.9 million, compared with a
pre-tax loss of GBP105,155 on turnover of GBP7.2 million in 2010.

Net debt at the March 31, 2011, stood at GBP1.7 million (2010:
GBP2 million) and interest payments of GBP147,538 in 2011 and
GBP154,662 in 2010 were a significant factor in the group's
annual losses for the past two years, PrintWeek relays.

PrintWeek adds that the independent auditor's report to the
group's 2010/11 accounts questioned the company's ability to
continue as a going concern and highlighted its GBP112,210 net
loss for the year and the fact that it had net current
liabilities of GBP849,930 at March 31, 2011.

Hawthornes Of Nottingham Ltd -- http://www.hawthornes.co.uk/--
is a privately-owned printing business based in Nottingham,
United Kingdom.


IA GLOBAL: UK Administrators Hand Back 2.4 Million Common Shares
----------------------------------------------------------------
IA Global, Inc., on July 9, 2012, entered into a Termination and
Release Agreement with Innovative Software Direct plc, its
subsidiary Powerdial Services Limited, a UK company in
administration, and the ISD Administrators in the United Kingdom,
whereby 2,400,000 shares of common stock, which were held by the
UK Administrators, were returned to the Company and cancelled in
exchange for US$2,100 in processing fees and a mutual release of
liabilities.  Simultaneously, the contemplated acquisition of
Powerdial from ISD was terminated.  The Company was and continues
to be, an unsecured creditor of ISD for US$150,000, which will
most likely be written off.  In addition, the company and UK
administrator consider this transaction as null and void ab
initio, as Powerdial went into forced administration before any
indicia of ownership or consideration could pass, and therefore
will not be included in the Company's consolidated financial
statements.

                      Settles with Former CFO

On Sept. 5, 2012, the Company entered into a Termination and
Release Agreement with Mark Scott, the Company's former Chief
Financial Officer, which terminated all previous employment,
consulting, release or other agreements of the parties, and
released one another from any and all claims and liabilities,
pending completion of settlement payments.  Mr. Scott resigned
from all positions with the Company on June 30, 2011.  As
previously reported on April 30, 2012, Mr. Scott had entered a
claim totaling US$167,598.  Mr. Scott had also entered into
previous settlement arrangements with the Company.  Under the
terms of the Scott Settlement Agreement, the Company will pay
Mr. Scott an aggregate of US$15,000 in four payments commencing
Sept. 15, 2012, through Dec. 15, 2012.  In addition, Mr. Scott
will receive 200,000 shares of IA Global Stock.

                         Director Resigns

Mr. Mark Lev resigned as a member of the Board of Directors,
effective as of May 11, 2012.  Mr. Lev's resignation from the
Board was not due to any disagreement with the Company relating
to the Company's operations, policies or practices.

                          About IA Global

San Francisco, Calif.-based IA Global, Inc. (OTCQB: IAGI.OB)
-- http://www.iaglobalinc.com/-- is a global services and
outsourcing company focused on growing existing businesses and
expansion through global mergers and acquisitions.  The Company
is utilizing its current partnerships to acquire growth
businesses in target sectors and markets at discounted prices.
The Company is actively engaging in discussions with businesses
that would benefit from our business acumen and marketing
expertise, knowledge of Asian Markets, and technology
infrastructure.

The Company's balance sheet at Dec. 31, 2010 showed US$21.51
million in total assets, US$19.14 million in total liabilities
and US$2.37 million in total stockholders' equity.

As reported in the Troubled Company Reporter on July 20, 2010,
Sherb & Co., LLP, in New York, expressed substantial doubt about
the Company's ability to continue as a going concern, following
the Company's results for the fiscal year ended March 31, 2010.
The independent auditors noted that the Company has incurred
significant operating losses, and has a working capital deficit
as of March 31, 2010.



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


* Moody's Says Negative Pressure on EU Corp. Rating to Persist
--------------------------------------------------------------
The weak macroeconomic trend for the Euro region, sovereign debt
stress, and related fiscal austerity will continue to adversely
affect the credit rating of most non-financial corporates in
Europe, Middle East and Africa (EMEA) in late 2012 and early
2013, says Moody's Investors Service in a Special Comment
published on Sept. 19.

The new report, entitled "EMEA Non-Financial Corporates: Negative
Credit Trends to Continue in Late 2012 and Early 2013", 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.

"Consumer confidence remains muted, while banks are likely to
continue to restrict their lending as part of a focus on
deleveraging and building capital ratios", says Jean-Michel
Carayon, a Moody's Senior Vice President and co-author of the
report. "EMEA corporates face significant challenges because
conditions in the global economy and primarily in Europe remain
very uncertain and fragile", continues Mr. Carayon. "Volatile
capital markets and uncertain access to issuance, will pose
additional challenges".

Moody's expects that, until at least year-end, the number of
rating downgrades will exceed upgrades, with upward rating
potential being limited except for a few well-diversified
corporates. Government-related issuers (GRIs) and corporates
highly exposed to euro area periphery countries continue to be at
higher risk of downgrades.

This reflects the direct impact on GRIs of the European sovereign
downgrades in Q1 as well as a number of downgrades in cyclical
industries and for highly leveraged issuers. Southern European
GRIs represented a number of the downgrades; however, excluding
GRIs, downgrades still exceeded upgrades by a ratio of nearly 2
to 1 in first eight months of 2012.

Across the EMEA corporate landscape, the proportion of outlooks
that are stable has declined from its peak in Q2 2011 of 74% of
the issuers with stable outlook to levels similar to those in Q2
2010, with just around 65% of the issuers with stable outlook.
Moreover, Moody's expects that credit-negative trends will
persist throughout 2012 and early 2013 and possibly deepen in the
event of any further sovereign credit deterioration. The
prevalent negative trends reflect the absence of an economic
recovery in Europe, with some major economies close to recession
and the continuing negative impact on corporates of adjustments
driven by the euro area sovereign debt crisis.

Although EMEA corporates face significant challenges because
conditions primarily in Europe remain very uncertain and fragile,
Moody's could still take modest positive rating actions on
issuers in industries that benefit from reasonably predictable
and stable trends and where those issuers are focused on
deleveraging. Data from recent quarters indicate that divergence
between European issuers may be increasing, with stability in
Northern Europe and sustained negative pressure in Southern
Europe. However, a degree of contagion could affect the stable
areas if conditions worsen or in the event of more contagion from
the sovereign crisis.

The number of rated issuer families increased to 601 as of August
2012 from 568 in Q2 2011, driven by newly rated non-investment-
grade issuers; however, the increase in rated issuers in H1 2012
occurred at a slower pace than in H1 2011.

Non- financial corporate defaults are currently at low levels in
line with Moody's expectations and for now the rating agency
forecasts a stable default rate for the next 12 months . However,
there is a material degree of uncertainty regarding the outlook
for the default rate and potential for the default rate to be
much higher if market liquidity tightens and the economic
environment deteriorates.


* BOOK REVIEW: Performance Evaluation of Hedge Funds
----------------------------------------------------
Edited by Greg N. Gregoriou, Fabrice Rouah, and Komlan Sedzro
Publisher: Beard Books
Hardcover: 203 pages
Listprice: $59.95
Review by Henry Berry

Hedge funds can be traced back to 1949 when Alfred Winslow Jones
formed the first one to "hedge" his investments in the stock
market by betting that some stocks would go up and others down.
However, it has only been within the past decade that hedge funds
have exploded in growth.  The rise of global markets and the
uncertainties that have arisen from the valuation of different
currencies have given a boost to hedge funds.  In 1998, there
were approximately 3,500 hedge funds, managing capital of about
$150 billion.  By mid-2006, 9,000 hedge funds were managing $1.2
trillion in assets.

Despite their growing prominence in the investment community,
hedge funds are only vaguely understood by most people.
Performance Evaluation of Hedge Funds addresses this shortcoming.
The book describes the structure, workings, purpose, and goals of
hedge funds.  While hedge funds are loosely defined as "funds
with no rules," the editors define these funds more usefully as
"privately pooled investments, usually structured as a
partnership between the fund managers and the investors."  The
authors then expand upon this definition by explaining what sorts
of investments hedge funds are, the work of the managers, and the
reasons investors join a hedge fund and what they are looking for
in doing so.

For example, hedge funds are characterized as an "important
avenue for investors opting to diversify their traditional
portfolios and better control risk" -- an apt characterization
considering their tremendous growth over the last decade.  The
qualifications to join a hedge fund generally include a net worth
in excess of $1 million; thus, funds are for high net-worth
individuals and institutional investors such as foundations, life
insurance companies, endowments, and investment banks.  However,
there are many individuals with net worths below $1 million that
take part in hedge funds by pooling funds in financial entities
that are then eligible for a hedge fund.

This book discusses why hedge funds have become "notorious as
speculating vehicles," in part because of highly publicized
incidents, both pro and con.  For example, George Soros made $1
billion in 1992 by betting against the British pound.
Conversely, the hedge fund Long-Term Capital Management (LTCP)
imploded in 1998, with losses totalling $4.6 billion.
Nonetheless, these are the exceptions rather than the rule, and
the editors offer statistics, studies, and other research showing
that the "volatility of hedge funds is closer to that of bonds
than mutual funds or equities."

After clarifying what hedge funds are and are not, the book
explains how to analyze hedge fund performance and select a
successful hedge fund.  It is here that the book has its greatest
utility, and the text is supplemented with graphs, tables, and
formulas.

The analysis makes one thing clear: for some investors, hedge
funds are an investment worth considering.  Most have a
demonstrable record of investment performance and the risk is
low, contrary to common perception.  Investors who have the
necessary capital to invest in a hedge fund or readers who aspire
to join that select club will want to absorb the research,
information, analyses, commentary, and guidance of this unique
book.

Greg N. Gregoriou teaches at U. S. and Canadian universities and
does research for large corporations.  Fabrice Rouah also teaches
at the university level and does financial research.  Komlan
Sedzro is a professor of finance at the University of Quebec and
an advisor to the Montreal Derivatives Exchange.


                            *********

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 * * *