TCREUR_Public/121005.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, October 5, 2012, Vol. 13, No. 199

                            Headlines



C R O A T I A

HRVATSKA ELEKTROPRIVREDA: S&P Cuts Corp. Credit Rating to 'BB-'


F R A N C E

ODDO ET COMPAGNIE: Fitch Cuts Subordinated Debt Rating to 'BB+'


G E R M A N Y

DAPD: Mulls 300 Job Cuts After Bankruptcy Filing
QUIRINUS PLC: Moody's Affirms 'Ba3' Rating on Class X2 Notes
QUIRINUS PLC: Fitch Downgrades Rating on Class F Notes to 'CC'


H U N G A R Y

KAPUVARI HUS: Liquidation Order Takes Effect


I R E L A N D

CELTIC RESIDENTIAL 9: S&P Lowers Rating on Class B Notes to 'B-'
MCEVOY FAMILY: Exit Examinership Following Glanbia Investment


I T A L Y

BANCA MONTE: Fails to Meet European Union Capital Targets


L I T H U A N I A

BANKAS SNORAS: Ernst & Young Appeals Court Ruling on Audit


N E T H E R L A N D S

DUTCH MBS: Moody's Assigns 'Ba1' Rating to EUR6.5-Mil. E Notes
DUTCH MBS XVII: Fitch Assigns 'B' Rating to EUR6.5MM Cl. E Notes
NORTHERN LIGHTS: Moody's Assigns 'Ba3' Rating to US$150MM LPNs


R U S S I A

NATIONAL STANDARD: Moody's Assigns Rating to Domestic Bonds
NATIONAL STANDARD: Moody's Assigns 'B3' Sr. Unsecured Debt Rating
NS FINANCE: Moody's Assigns Rating to Domestic Bonds
NS FINANCE: Moody's Assigns 'B3' Senior Unsecured Debt Rating


S L O V E N I A

* SLOVENIA: Moody's Says Banking System Outlook Remains Negative


U N I T E D   K I N G D O M

CLINTON CARDS: American Greetings Buys Stores, Brand
JJB SPORTS: Crewe Store Closes Following Administration
OPTICAL EXPRESS: Unit in Administration, Closes 40 Stores


X X X X X X X X

* BOOK REVIEW: Performance Evaluation of Hedge Funds


                            *********


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C R O A T I A
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HRVATSKA ELEKTROPRIVREDA: S&P Cuts Corp. Credit Rating to 'BB-'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term
corporate credit and senior secured debt ratings on Hrvatska
Elektroprivreda d.d. (HEP), the 100% state-owned, vertically
integrated Croatian electricity utility, to 'BB-' from 'BB'. "At
the same time, we placed the ratings on CreditWatch with negative
implications," S&P said.

"The downgrade reflects our view that HEP's business prospects
have deteriorated; that poor hydrological conditions, rising
commodity prices, and an increased share of electricity imports
to be procured at volatile market prices likely will lead to
persistent cash flow pressures. Negative cash flows have already
led to aggressive use of short-term credit lines and deferral of
investments. However, we understand that to alleviate its
immediate funding needs and extend debt maturities, the company
aims to raise medium-to-long-term financing, which we expect to
happen in October," S&P said.

"We have revised our assessment of HEP's business risk profile to
'fair' from 'satisfactory.' This reflects the company's inherent
earnings volatility in the context of unpredictable, politically
determined, regulated tariffs. Although the government raised
tariffs by 18.9% in May 2012, we are uncertain as to whether
future tariff resets will allow an adequate return on investments
and sufficient and timely compensation of cost overrun," S&P
said.

"However, the company benefits from some flexibility as most of
its new generation projects are non-committed (that is,
discretionary at this stage). It is also pursuing a plan to
optimize costs, which aims to achieve about Croatian kuna HRK2.0
billion of savings over 2012-2016. Also, we expect the state to
potentially support the investments by forgoing dividends, as in
the past (excluding a one-off dividend in 2011)," S&P said.

"Over the next approximately three to five years we expect HEP to
generate consistently negative free operating cash flows (FOCF)
(after capital expenditures, net of connection income). This is
because HEP has an ambitious capital investment program, planned
at HRK19.0 billion for the period between 2012 and 2016, which
will result in ongoing funding needs and increase of leverage.
What's more, HEP faces HRK1.3 billion of principal repayments in
2013 alone (notwithstanding new loans) and risks related to the
annual renewal of its HRK1.0 billion fully used committed credit
lines. Even factoring new planned financing, we see little
prospect for a sustainable recovery in HEP's liquidity position
over the next 12 months. This is why we have revised HEP's
financial risk profile to 'highly leveraged' from 'aggressive,'"
S&P said.

"The 'BB-' rating on HEP is based on the company's stand-alone
credit profile (SACP), which we assess at 'b', as well as on our
opinion that there is a 'high' likelihood that the government of
the Republic of Croatia (BBB-/Negative/A-3) would provide timely
and sufficient extraordinary support to HEP in the event of
financial distress. In accordance with our criteria for
government-related entities (GREs), our view of a 'high'
likelihood of extraordinary government support is based on our
assessment of HEP's 'very important' role for the energy sector
and the broader economy in Croatia; and on its 'strong' link with
the Croatian government, which is the sole shareholder and is
actively involved in defining the company's strategy," S&P said.

"We continue to view HEP's liquidity position as 'less than
adequate' under our criteria. We base our assessment on what we
view as HEP's 'weak' stand-alone liquidity arrangements, combined
with our view that the Croatian government has the ability and
willingness to provide sufficient liquidity support to HEP in a
timely manner," S&P said.

As of June 30, 2012, HEP had the following liquidity sources:

-- HRK240.5 million of cash balances (about EUR32.5 million).

-- S&P understands that HEP has about HRK350.0 million (about
    EUR47.3 million) available for specific project financing
    facilities and has concluded EUR123.2 million (HRK925.5
    million) of long-term funding from the European Bank for
    Reconstruction and Development.

-- About HRK2.4 billion of Standard & Poor's-adjusted funds from
    operations over the next 12 months.

As of the same date, S&P believes liquidity uses comprise:

-- About HRK0.9 billion of principal repayments under its bonds
    and mostly amortizing loans. Furthermore, the company has
    fully used HRK1.3 billion under revolving lines and framework
    agreements, out of which HRK1.0 billion is due for renewal in
    June 2013, with the remainder due earlier.

-- About HRK3.0 billion capex (net of connection charges),
    which S&P understands is about 35% deferrable.

-- No dividend payout on 2011 profit as per the shareholders'
    decision.

"We see HEP's interest costs and principal repayment as sensitive
to any domestic currency depreciation and increase in loan
pricing. On Dec. 31, 2011, HEP reported that about 72% of its
total debt is euro-denominated. The company does not hedge its
foreign currency exposure," S&P said.

"Furthermore, HEP has stated that framework agreements of a total
HRK68.6 million are available for short-term borrowing purposes.
The company has said that at June 30, 2012, it was in breach of
financial covenants, but has procured waivers from all lending
banks," S&P said.

"We aim to resolve the CreditWatch placement within a month.
During this period, we will monitor whether HEP completes its
planned financing. We could affirm the ratings and remove them
from CreditWatch if HEP completes the planned financing in
October and if, at the same time, we believe the company will
meet its financial covenants as per the end of 2012. This will
require a stabilization of operational performance and active
management of investment levels," S&P said.

"We will likely lower HEP's SACP if the company is not successful
with its planned financing, as this will exert pressure on the
company's liquidity. In such a case, we will assess how the
government and HEP intend to find alternative ways to fund the
liquidity shortfall by the end of 2012. We could reassess our
opinion of 'high' likelihood of extraordinary state support if we
were to doubt the government's capacity or willingness to provide
timely liquidity support. A combination of one notch lower SACP
and 'moderately high' likelihood of state support could result in
a one notch lowering of the corporate credit rating," S&P said.



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F R A N C E
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ODDO ET COMPAGNIE: Fitch Cuts Subordinated Debt Rating to 'BB+'
---------------------------------------------------------------
Fitch Ratings has downgraded Oddo et Compagnie's (Oddo) Long-Term
Issuer Default Rating (IDR) to 'BBB-' from 'BBB+', Short-Term IDR
to 'F3' from 'F2' and Viability Rating (VR) to 'bbb-' from
'bbb+'.  The Outlook on the Long-Term IDR is Negative.

Rating Action Rationale

The downgrades of Oddo's IDRs and VR reflect Fitch's view that
Oddo's franchise and earnings generation have been negatively
affected by the tougher operating environment, particularly for
the investment banking (IB) division. It is not clear to Fitch
whether Oddo can establish a viable IB franchise in the medium
term.  Oddo has recently acquired two small companies that focus
on asset management and private banking.

RATING DRIVERS AND SENSITIVITIES - IDR and VR

Oddo's IDRs and VR reflect the bank's niche franchise, small size
and weak profitability in the IB division.  They also take into
account the bank's prudent risk-taking approach, sound liquidity
and adequate capital.

Several of Oddo's IB businesses are suffering from overall lower
volumes in the industry.  Moreover, Oddo's lack of scale means
that some of its IB businesses are not profitable.  In H112, Oddo
managed to reduce costs through synergies with entities acquired
in 2010 and 2011 (Robeco, Banque d'Orsay) and headcount reduction
in less profitable businesses.  However, cost reduction may not
be sufficient to offset Oddo's weak revenue generation.  The IB
industry as a whole is in a process of change without much
transparency around how developments will play out.  In Fitch's
view, Oddo's small franchise makes it particularly vulnerable to
such changes.

Fitch considers Oddo's ownership to drive a prudent risk-taking
approach.  Philippe Oddo (one of the two unlimited partners) is
personally liable for any loss, and around one-third of Oddo's
employees hold 30% of the bank's capital.  Moreover, Oddo
maintains cautious liquidity management and relatively low
leverage, in line with its ambition to remain an independent
financial institution.  The bank runs an ample liquid asset
portfolio, which largely covers its relatively modest short-term
funding needs.

The Negative Outlook on Oddo's Long-Term IDR reflects Fitch's
concerns that the prevailing difficult operating environment is
likely to continue weighing on both the bank's IB and asset
management revenue generation.  Any further deterioration in
Oddo's recurring profitability, or indication of a weakening of
its IB franchise, could result in a downgrade of Oddo's IDRs and
VR.  A similar rating action could be taken if the bank's capital
level materially worsened or its liquidity position materially
decreased. Upside potential for the IDRs and VR is not expected.

RATING DRIVERS AND SENSITIVITIES - SUPPORT RATING AND SUPPORT
RATING FLOOR

Fitch considers that the probability of sovereign or
institutional support for Oddo, although possible, cannot be
relied upon, resulting in a '5' Support Rating and a 'No Floor'
Support Rating Floor This is not expected to change.

RATING DRIVERS AND SENSITIVITIES - SUBORDINATED DEBT

The lower Tier 2 subordinated debt issued by Oddo is notched off
Oddo's VR in accordance with Fitch's criteria 'Rating Bank
Regulatory Capital and Similar Securities'.  Therefore, lower
Tier 2 debt's rating has been downgraded to 'BB+' from 'BBB' and
is sensitive to any change in Oddo's VR.

Subordinated lower Tier 2 debt is rated one notch below Oddo's VR
to reflect below average loss severity of this type of debt when
compared to average recoveries.

The rating actions are as follows:

  -- Long-Term IDR: downgraded to 'BBB-' from 'BBB+'; Negative
     Outlook
  -- Short-Term IDR: downgraded to 'F3' from 'F2'
  -- Viability Rating: downgraded to 'bbb-' from 'bbb+'
  -- Support Rating: affirmed at '5'
  -- Support Rating Floor: affirmed at 'No Floor'
  -- Senior unsecured debt: downgraded to 'BBB-' from 'BBB+'
  -- Subordinated (Lower Tier 2) debt (FR0010494419): downgraded
     to 'BB+' from 'BBB'
  -- Commercial paper: downgraded to 'F3' from 'F2'



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G E R M A N Y
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DAPD: Mulls 300 Job Cuts After Bankruptcy Filing
------------------------------------------------
According to Bloomberg News' Annette Weisbach, Financial Times
Deutschland, citing German news agency DAPD's mandated insolvency
administrator Wolf von der Fecht, reported that the company,
which filed for bankruptcy on Tuesday, will look into cutting
jobs among 300 of its 500 employees.

FTD said another six affiliated units of DAPD were set to file
for bankruptcy yesterday, Bloomberg relates.

FTD said that DAPD's investor Voderwuelbecke would welcome new
investors such as other media outlets, Bloomberg notes.

Mr. von der Fecht, as cited by FTD, said that there are many
interested investors, according to Bloomberg.

As reported by the Troubled Company Reporter-Europe on Oct. 4,
2012, Deutsche Welle related that administrator spokeswoman
Brigitte von Haacke said the news agency had been losing money
since its foundation and that the parent company had now stopped
trying to plug its shortfalls.


QUIRINUS PLC: Moody's Affirms 'Ba3' Rating on Class X2 Notes
------------------------------------------------------------
Moody's Investors Service has downgraded the following class of
Notes issued by Quirinus (European Loan Conduit No. 23) plc
(amount reflect initial outstanding):

    EUR560M Class A Notes, Downgraded to Baa1 (sf); previously on
    May 26, 2011 Downgraded to Aa2 (sf)

At the same time, Moody's has affirmed the following ratings:

    X2 Notes, Affirmed at Ba3 (sf); previously on Aug 22, 2012
    Downgraded to Ba3 (sf)

Moody's does not rate the Class B, Class C, Class D, Class E or
Class F Notes of the Issuer and has withdrawn the rating on the
Class X1 Notes on August 21, 2012.

Ratings Rationale

The downgrade of the rating of the Class A Notes is driven by the
increase in the expected loss of the remaining pool due to the
increase in the assessed refinancing risk and lower value
estimates compared to the last review.

The increase in credit enhancement through the prepayment of the
previously largest loan, the Lumiere Loan, is not sufficient to
offset the higher expected loss for the remaining pool. The
modified pro-rata allocation of the prepayment proceeds prevented
a higher increase in the credit enhancement of the Class A Notes.

In its base case Moody's assumes that the H&B Retail Loan will
not be repaid at scheduled maturity and will be transferred to
special servicing which would breach the sequential pay trigger
and principal proceeds would be allocated sequentially. However,
even the sequential allocation will not sufficiently increase the
credit enhancement for Class A to provide a buffer against the
expected and potential further value declines.

The rating already reflects the single loan pool after the
repayment/ work-out of the Fairacre and the H&B Retail Loan and
considers potential further value declines of the Eurocastle
portfolio.

The rating on the Class X2 Detachable Coupons is affirmed because
the current rating already incorporates the updated risk
assessment.

The key parameters in Moody's analysis are the default
probability of the securitized loan (both during the term and at
maturity) as well as Moody's value assessment for the prime
single office property securing this loan. Moody's derives from
those parameters a loss expectation for the securitized pool.

Moody's weighted average (WA) loan-to-value (LTV) ratio for the
pool is 98.0%, which compares to the reported WA LTV of 79.7%. At
last review, Moody's WA whole loan LTV was 70.5%, which was
mainly driven by the lower LTV of the prepaid Lumiere Loan. Given
the high LTV levels Moody's expects overall a high default
probability (>50%) for the remaining loans.

One loan, the Fairacre Loan accounting for 6.9% to the current
pool balance is in special servicing undergoing workout. Moody's
expects losses on this loan in the range of 0-25%.

The other two loans have maturities in November 2012 (21.4% of
the pool) and in February 2016 (71.8%).

The concentration of the pool is above average with all loans
secured by retail properties in Germany.

The rating of the Class A Notes is very sensitive to the breach
of the sequential pay trigger. Given the concentration of the
pool with only three loans remaining and the deteriorating credit
quality of the remaining loans a sequential allocation of
repayment proceeds is necessary to build up sufficient credit
enhancement to off-set higher expected losses of the remaining
loans.

If the H&B Retail Loan was not transferred to special servicing,
the repayment and even the recovery proceeds would be allocated
modified pro-rata. In such a scenario, the rating of the Class A
would potentially be further downgraded.

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

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

Moody's Portfolio Analysis

Quirinus (European Loan Conduit No. 23) plc is a securitization
of initially 10 loans that closed in July 2006. The remaining
three loans in the pool are secured on portfolios of in total 51
retail properties, for the most part supermarkets, spread across
Germany.

At the August 2012 interest payment date, the total securitized
loan balance was EUR118.8 million, down by 83% from EUR700.8
million at closing. The seven loan repayment and prepayment
proceeds have been allocated on a modified pro-rata basis
according to loan buckets. Therefore, the credit enhancement of
the Class A Notes has only increased to 30.5% compared to 20.1%
at closing. Since last review, the largest loan in the pool at
closing (Lumiere Loan, 53.8% of the initial pool) has been
prepaid ahead of its scheduled maturity date in February 2013.
Moody's assessed the quality of the loan from an expected loss
perspective as above average compared to the total pool.

To date, no loan has realised a loss. The smallest loan in the
pool, Fairacre (6.9%) is currently in special servicing due to
its inability to refinance at its maturity date in February 2011.
This EUR8.2 million loan has a reported ICR of 2.0x and is
secured on five German supermarkets. The borrowers have filed for
insolvency and the portfolio is currently marketed.

The currently largest loan, Eurocastle (71.8%) is secured on 41
German retail properties. The interest only loan has shown
relatively stable rental income through time with a currently
reported ICR of 1.8x. The underlying portfolio faces lease
rollover risk for more than 41% of the rental cash flow in 2015
and 2016 and the WA remaining lease is rather short at
approximately 4 years. The loan has the longest maturity in the
pool in February 2016. Moody's LTV is 100%.

The currently second largest loan is the H&B Retail (21.4%) which
is secured on five German retail properties. The loan is
currently able to afford its scheduled loan interest, although
H&B Retail Loan's sponsors have been injecting cash in order to
meet the loan's scheduled principal payments. In its base case
Moody's assumes that the H&B Retail Loan will not be repaid on
its scheduled maturity date in November 2012 given its rather
high LTV of 89% based on Moody's value and the rather short WA
remaining lease term of approximately 4 years.

Portfolio Loss Exposure: Moody's expects a significant amount of
losses on the securitized portfolio, stemming mainly from the
refinancing profile of the securitized portfolio. Given the
default risk profile and the anticipated work-out strategy for
defaulted and potentially defaulting loans, these expected losses
are likely to crystallize only towards the end of the transaction
term.

Rating Methodology

The methodologies used in this rating were Moody's Approach to
Real Estate Analysis for CMBS in EMEA: Portfolio Analysis (MoRE
Portfolio) published in April 2006 and Moody's Approach to Rating
Structured Finance Interest-Only Securities published in February
2012.

Other Factors used in this rating are described in European CMBS:
2012 Central Scenarios published in February 2012.

The updated assessment is a result of Moody's on-going
surveillance of commercial mortgage backed securities (CMBS)
transactions. Moody's prior assessment is summarized in a press
release dated May 26, 2011. The last Performance Overview for
this transaction was published on September 12, 2012.

In rating this transaction, Moody's used both MoRE Portfolio and
MoRE Cash Flow to model the cash flows and determine the loss for
each tranche. MoRE Portfolio evaluates a loss distribution by
simulating the defaults and recoveries of the underlying
portfolio of loans using a Monte Carlo simulation. This portfolio
loss distribution, in conjunction with the loss timing calculated
in MoRE Portfolio is then used in MoRE Cash Flow, where for each
loss scenario on the assets, the corresponding loss for each
class of notes is calculated taking into account the structural
features of the notes. As such, Moody's analysis encompasses the
assessment of stressed scenarios.

Moody's ratings are determined by a committee process that
considers both quantitative and qualitative factors. Therefore,
the rating outcome may differ from the model output.


QUIRINUS PLC: Fitch Downgrades Rating on Class F Notes to 'CC'
--------------------------------------------------------------
Fitch Ratings has downgraded Quirinus (European Loan Conduit No.
23) plc's commercial mortgage-backed notes, as follows:

  -- EUR82.7m Class A (XS0259561925) downgraded to 'A+sf' from
     'AA+sf'; Outlook Stable
  -- EUR5.2m Class B (XS0259562576) downgraded to 'Asf' from
     'AAsf'; Outlook Stable
  -- EUR6.3m Class C (XS0259562907) downgraded to 'BBBsf' from
     'Asf'; Outlook Stable
  -- EUR8.3m Class D (XS0259563202) downgraded to 'BBsf' from
     'BBBsf'; Outlook Stable
  -- EUR9.3m Class E (XS0259563624) downgraded to 'CCCsf' from
     'Bsf'; Recovery Estimate (RE) 75%
  -- EUR7m Class F (XS0259564192 downgraded to 'CCsf' from
     'CCCsf'; RE0%

The downgrades are driven by the high leverage of the remaining
three loans in the transaction, which Fitch believes will
struggle to redeem at their respective maturity dates.  All the
loans are backed by similar collateral: German retail warehouse
assets tenanted by high quality German discount retailers on WA
lease terms that range from 4.4 to 6.4 years.

Fairacre, the smallest loan in the pool, representing 6.9% of
outstanding principal balance, was scheduled to mature in
February 2009.  It failed to redeem and entered special servicing
in January 2011.  The borrower subsequently filed for bankruptcy
and at present the agency understands that the insolvency
administrator and special servicer have marketed the portfolio
for sale.  Fitch views the loan as a bellwether to the
forthcoming maturities of the larger H&B and Eurocastle loans in
November 2012 and February 2016, respectively.

Although Fitch estimates that all three loans have loan-to-value
ratios approaching or in excess of 100%, all still provide very
strong interest coverage, with ratios between 1.8x and 2.2x.  A
full cash sweep is currently in place for the defaulted Fairacre
loan, which has reduced the loans' outstanding balance to EUR8.2
million from EUR9.4 million at closing.  However, the benefit of
a strategy of sweeping cash at loan maturity in order to de-lever
the loans may be undermined by the weak lease profiles across the
remaining loans.  For example, the H&B loan portfolio contains a
single lease expiring in October 2014 that accounts for one-third
of that loan's current rent, exposing the loan to severe income
concentration risk.

Fitch expects that the EUR25.4 million H&B loan will fail to
redeem at loan maturity and will follow Fairacre into entering
special servicing.  By doing so, the aggregate balance of loans
in special servicing would be above 25%, thereby causing a switch
in principal paydown to fully sequential and offering stronger
credit enhancement to the higher rated tranches.

Since the last rating action in October 2011, Lumiere, the
largest loan in the pool, has repaid in full in a modified pro-
rata fashion, which along with the minor amortization receipts
has reduced the outstanding note balance by EUR376.8 million.



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KAPUVARI HUS: Liquidation Order Takes Effect
--------------------------------------------
MTI-Econews reports that a judge for the Gyor Court on Thursday
said a court order placing Kapuvari Hus under liquidation took
legal effect on Oct. 1.

Kinga Mate said that the company's receiver is Hitelintezeti
Felszamolo, MTI-Econews relates.

The government declared Kapuvari Hus of "special significance" in
September, MTI-Econews recounts.

According to MTI-Econews, government spokesman Andras Giro-Szasz
said that the declaration was made to prevent assets from being
removed from the company, putting jobs in danger.

Kapuvari Hus is a Hungarian meat company.



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CELTIC RESIDENTIAL 9: S&P Lowers Rating on Class B Notes to 'B-'
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its credit ratings on
all classes of notes in Celtic Residential Irish Mortgage
Securitisation No. 9 PLC (Celtic 9) and Celtic Residential Irish
Mortgage Securitisation No. 10 PLC (Celtic 10).

"The rating actions follow the continued increases of severe
arrears in these transactions, and deterioration of the Irish
housing market. With lender forbearance measures and legal and
regulatory frameworks in place, we have witnessed low levels of
repossessions within these transactions. In order to address
these risks, inherent within the Irish housing market, we have
assumed that all loans that are more than nine months delinquent
are in default, and will result in losses, with recoveries being
realized at the end of our assumed foreclosure period.
Consequently, and even with the benefit of recoveries, we have
concluded that the class B notes in both Celtic 9 and 10 are
effectively undercollateralized," S&P said.

"In analyzing this transaction, we have applied our general
criteria for assigning and monitoring ratings," S&P said.

"We have analyzed the credit quality of the assets in this
transaction through conducting loan-level analyses of the
mortgage pools. For each loan in the pool, our analysis estimated
the foreclosure frequency and the loss severity and, by
multiplying the foreclosure frequency by the loss severity, the
potential loss associated with each loan. To quantify the
potential losses associated with the entire pool, we calculated a
weighted-average foreclosure frequency (WAFF) and a weighted-
average loss severity (WALS) at each rating level. The product of
these two variables estimates the required loss protection, in
the absence of any additional factors. We assume that the
probability of foreclosure is a function of both borrower and
loan characteristics, and to become more likely (and the realized
loss on a loan more severe) as the economic environment
deteriorates," S&P said.

"In performing the credit analysis on this pool, we adopted the
methodology and assumptions described in the sections entitled
'Foreclosure Frequency Assumptions' and 'Loss Severity
Assumptions' in our Spanish residential mortgage-backed
securities (RMBS) criteria, with these adjustments for this
transaction," S&P said:

    'AA ' base foreclosure frequency: 9%;
    'A ' base foreclosure frequency: 7%;
    'BBB ' base foreclosure frequency: 5%;
    'AA ' market value decline: 40%;
    'A ' market value decline: 35%;
    'BBB ' market value decline: 30%;
    'BB ' market value decline: 25%;
    Jumbo loan penalty: EUR500,000 in Dublin;
    Jumbo valuation penalty: EUR625,000 in Dublin;
    First-time buyer penalty: 10% addition to adjusted base
    foreclosure frequency;
    Income multiple penalty: 20% addition to adjusted base
    foreclosure frequency;
    Self-certified penalty: 25% addition to adjusted base
    foreclosure frequency;
    No adjustment is made for loans with loan-to-value (LTV)
    ratios of less than 50%;
    Geographic concentration penalty: 1% addition to adjusted
    base foreclosure frequency for all loans if the concentration
    is greater than 60% in Dublin and greater than 20% in any
    other county; The fixed costs of foreclosure are assumed to
    be 4% of the loan balance; and
    The foreclosure period is assumed to be 48 months for the
    reasons set out further.

"The criteria applicable to our cash flow analysis for this
transaction are primarily our 'Cash Flow Criteria for European
RMBS Transactions,' published on Nov. 20, 2003, and 'Methodology
And Assumptions: Update To The Cash Flow Criteria For European
RMBS Transactions,' published on Jan. 6, 2009," S&P said.

"Due to current forbearance measures and the legal uncertainty
regarding the foreclosure process, repossessions have generally
been limited in the Irish residential mortgage market. To address
this risk, we have increased our foreclosure period in our
analysis to 48 months. Additionally, we have assumed that all
loans with arrears greater than nine monthly payments default on
Day 1 in our cash flow analysis, with losses and recoveries being
realized at the end of the 48 month foreclosure period," S&P
said.

"The level of severe arrears in both transactions has been
increasing steadily. In Celtic 9, 90+ day delinquencies have
risen to 19.09% from 11.71% since our previous review in March
2011, while In Celtic 10, 90+ day delinquencies have increased to
17.85% from 12.42% over the same period," S&P said.

"The continued decline in Irish house prices has also pushed up
the weighted-average indexed LTV ratios in both mortgage pools,
with both transactions exhibiting higher proportions of borrowers
in negative equity, compared with our previous review. This,
combined with the increases in arrears, has resulted in an
overall increase in the WAFF, WALS, and required loss protection
estimates in our analysis," S&P said.

"The reserve fund for both transactions are dynamically sized
(i.e., partially sized based on the balance of nonperforming
loans) and are nonamortizing. The reserve fund for Celtic 10 is
currently at the level required by the transaction documents.
However, with reduced excess spread, the reserve fund in Celtic 9
is currently at 98.7% of the required level for the current
interest payment date," S&P said.

"Each transaction also features a liquidity reserve fund, which
is funded through principal receipts and can be replenished on
each interest payment date up to 1% of the current collateral
balance. Thus, in a situation where transaction performance is
weak, the issuer can continue to borrow principal to meet timely
payment of interest on the class B notes, at the expense of
meeting ultimate payment of principal on the class A2 notes," S&P
said.

"When taking into account recoveries, the class A2 notes in both
transactions are fully collateralized. However, our assumptions
of undercollateralization give rise to negative carry. This,
combined with the fact that principal can be used to pay interest
through the liquidity reserve fund, means that we observe
significant principal shortfalls in our cash flow analysis of
each of these transactions. Our analysis shows that the levels of
credit enhancement in both transactions are insufficient for the
notes to maintain our current rating levels. Consequently, we
have lowered to 'B+ (sf)' from 'A (sf)' and 'B (sf)' from 'BBB+
(sf)' our ratings on Celtic 9's class A2 notes and Celtic 10's
class A2 notes," S&P said.

"We have also lowered to 'B- (sf)' our ratings on the class B
notes in both transactions. This reflects our view on credit
enhancement erosion due to assumed undercollateralization, even
when considering recoveries (assumed at 50%) and the available
reserve fund level," S&P said.

Celtic 9 and Celtic 10 are Irish RMBS transactions backed by
mortgages originated by First Active--a subsidiary of Ulster Bank
Ireland 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 Reports
included in this credit rating report are available at:

          http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class    Rating
      To        From

Ratings Lowered

Celtic Residential Irish Mortgage Securitisation No. 9 PLC
EUR1.75 Billion Mortgage-Backed Floating-Rate Notes

A2    B+ (sf)   A (sf)
B     B- (sf)   BB (sf)

Celtic Residential Irish Mortgage Securitisation No. 10 PLC
EUR1.79 Billion Residential Mortgage-Backed Floating-Rate Notes

A2    B (sf)    BBB+ (sf)
B     B- (sf)   BB- (sf)


MCEVOY FAMILY: Exit Examinership Following Glanbia Investment
-------------------------------------------------------------
Business and Leadership reports that McEvoy Family Foods, which
is co-headed by former UK apprentice star Jane McEvoy, has exited
examinership following an investment of EUR420,000 in the
business by Glanbia Consumer Foods.

The company is now a subsidiary of Glanbia Consumer Foods, but
will continue to trade under its existing name, with Gary and
Jane McEvoy continuing to run the company, Business and
Leadership notes.  According to Business and Leadership, Gary
McEvoy will continue to lead the business, while Jane McEvoy will
focus on developing a new brand of children's foods -- Harry's
Little World.

Business and Leadership relate that in a statement, Glanbia said
it had invested in McEvoy Family Foods as "it reflects its new
chilled food strategy of developing artisan food brands".

McEvoy Family Foods was established in April 2009 and generated
sales of EUR1.8 million in 2011 after securing contracts with
SuperValu, Centra and Lidl, Business and Leadership recounts.
The company specializes in the production of soups and garlic
breads for retail chains' own brand ranges and has won a range of
awards for its produce, according to Business and Leadership.



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


BANCA MONTE: Fails to Meet European Union Capital Targets
---------------------------------------------------------
Ben Moshinsky and Jim Brunsden at Bloomberg News report that
Banca Monte dei Paschi di Siena SpA and banks in Cyprus and
Slovenia failed to meet European Union capital targets as lenders
raised more than EUR200 billion (US$258 billion) to bolster
investor confidence.

According to Bloomberg, Monte Paschi, the world's oldest bank,
said in a statement on its Web site that the bank missed a June
capital target by EUR1.7 billion.  The bank, as cited by
Bloomberg, said that this "is being addressed" with the explicit
support of the Italian government."

"The news is only the confirmation of what was already known,"
Bloomberg quotes  Fabrizio Bernardi, a Milan-based analyst at
Fidentiis Equities, as saying.  "Monte Paschi needs to address
the issue by the year end.  The implementation of state aid
request will allow it to become EBA compliant."

Monte Paschi is borrowing EUR3.4 billion by selling bonds to the
state to plug the capital gap, after Chief Executive Officer
Fabrizio Viola, who took over in January failed to find private
funding to meet the European Banking Authority's requirement,
Bloomberg discloses.

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



=================
L I T H U A N I A
=================


BANKAS SNORAS: Ernst & Young Appeals Court Ruling on Audit
----------------------------------------------------------
Aaron Eglitis and Bryan Bradley at Bloomberg News, citing Baltic
News Service, report that Ernst & Young Baltic UAB appealed a
ruling by Lithuanian authorities that auditing controls were
inadequate when it reviewed the financial reports of Bankas
Snoras AB.

Bloomberg relates that the newswire said that a Vilnius court has
agreed to hear the appeal of the June 20 decision by the
Authority of Audit and Accounting.

According to Bloomberg, BNS said that separately, Lithuanian
prosecutors this week said they would investigate whether Ernst &
Young Baltic properly conducted the audit of Snoras's 2010
financial statements.

BNS, as cited by Bloomberg, said Ernst & Young Baltic stands by
its audit opinion given on Mar. 10, 2011, and will continue to
use all resources to defend its work on the audit.  BNS said that
the bank's auditor, Ramunas Bartasius, whose auditor's license
was canceled by Lithuanian authorities in June, no longer works
for Ernst & Young Baltic, Bloomberg notes.

Lithuania's central bank took over Snoras, then the country's
third biggest bank by deposits, in November 2011 after
discovering assets reported on the lender's balance sheet were
missing, Bloomberg recounts.

                       About Bankas Snoras

Bankas Snoras AB is Lithuania's fifth biggest lender.  Snoras
held LTL6.05 billion in deposits and had assets of LTL8.14
billion at the end of September. It competes with Scandinavian
lenders including SEB AB, Swedbank AB (SWEDA), and Nordea AB.  It
also controls investment bank Finasta and Latvian lender Latvijas
Krajbanka AS.

As reported in the Troubled Company Reporter-Europe on Dec. 2,
2011, The Baltic Times, citing LETA/ELTA, said Vilnius District
Court accepted the application regarding the initiation of
bankruptcy proceedings against Snoras bank.  The Bank of
Lithuania delivered application on Snoras bankruptcy on Nov. 28,
2011.

The TCR-Europe, citing Bloomberg News, reported on Nov. 28, 2011,
that Lithuania's central bank said that Snoras' financial
situation is "worse than previously identified" and saving the
bank "would cost significantly more and would take longer than
the available liquidity" at Snoras.  Governor Vitas Vasiliauskas
said at a news conference on Nov. 24 that some LTL3.4 billion
(US$1.3 billion) in assets are missing, according to Bloomberg.



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


DUTCH MBS: Moody's Assigns 'Ba1' Rating to EUR6.5-Mil. E Notes
--------------------------------------------------------------
Moody's Investors Service has assigned definitive credit ratings
to the following classes of notes issued by Dutch MBS XVII B.V.:

    EUR135MM A1 Notes, Definitive Rating Assigned Aaa (sf)

    EUR365MM A2 Notes, Definitive Rating Assigned Aaa (sf)

    EUR8MM B Notes, Definitive Rating Assigned Aa1 (sf)

    EUR7MM C Notes, Definitive Rating Assigned Aa3 (sf)

    EUR5MM D Notes, Definitive Rating Assigned A2 (sf)

    EUR6.5MM E Notes, Definitive Rating Assigned Ba1 (sf)

The class F notes are not rated by Moody's.

The transaction represents the securitization of Dutch prime
mortgage loans backed by residential properties located in the
Netherlands and originated or acquired by subsidiaries of NIBC
Bank N.V. ("NIBC" rated Baa3/P-3). The portfolio will be serviced
by NIBC.

Ratings Rationale

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

The expected portfolio loss of 0.65% of the portfolio at closing
and the required MILAN Credit Enhancement of 5.0% served as input
parameters for Moody's cash flow model, which is based on a
probabilistic lognormal distribution as described in the report
"The Lognormal Method Applied to ABS Analysis", published in July
2000.

The key drivers for the MILAN Credit Enhancement number, which is
in line with other prime Dutch RMBS transactions which closed
during the past twelve months, are (i) the weighted average loan-
to-foreclosure-value (LTFV) of 81.9%, which is in line with other
prime Dutch RMBS transactions, (ii) the proportion of interest-
only loan parts (70.0%) which is slightly higher than for other
prime Dutch RMBS transactions, (iii) the weighted average
seasoning of 9.5 years which is high relative to the Dutch
market.

The key drivers for the portfolio expected loss are (i) the
performance of the seller's precedent transactions as well as the
performance on the seller's book, (ii) benchmarking with
comparable transactions in the Dutch RMBS market, and (iii) the
current economic conditions in the Netherlands in combination
with historic recovery data of foreclosures received from the
seller.

Approximately 26.5% of the portfolio is linked to life insurance
policies (life mortgage loans), which are exposed to set-off risk
in case an insurance company goes bankrupt. The seller has
provided loan-by-loan insurance company counterparty data,
whereby 90.7% of all life insurance-linked products are linked to
insurance policies provided by group companies of SRLEV N.V.
(Baa1 IFSR), which is part of REAAL Verzekeringen group. Moody's
considered the set-off risk in the cash flow analysis.

The transaction benefits from a non-amortizing reserve fund that
will be funded at 0.5% of the outstanding portfolio from the
proceeds of the class F notes. The reserve account is replenished
before interest payments on the class F notes. Apart from the
reserve fund, the transaction benefits from an excess margin of
50 bps through the swap agreement. The swap counterparty is
Credit Suisse International (A1/P-1). The transaction also
benefits from an amortizing liquidity facility of 1.5% of the
outstanding principal amount of the notes (excluding the class F
notes) with a floor of 0.75% of the principal amount of the notes
at closing (excluding the class F notes). The liquidity facility
is available for as long as the class A1 and A2 notes are
outstanding.

Operational Risk Analysis: Moody's has analyzed the potential
operational risks associated with the servicing and cash
management functions in the transaction. NIBC provides loan
servicing and cash management services and has sub delegated the
loan administration to Stater (not rated). If NIBC's rating falls
below Baa3, the issuer and the security trustee will use best
efforts to appoint a back-up servicer and cash manager.

Moody's Parameter Sensitivities: At the time the rating was
assigned, the model output indicated that class A2 would have
achieved Aaa if the expected loss was as high as 2.0% assuming
MILAN Credit Enhancement to 7.0% and all other factors remained
the same. Class A1 would have achieved Aaa in all tested
scenarios.

Moody's Parameter Sensitivities provide a quantitative/model-
indicated calculation of the number of rating notches that a
Moody's structured finance security may vary if certain input
parameters used in the initial rating process differed. The
analysis assumes that the deal has not aged and is not intended
to measure how the rating of the security might migrate over
time, but rather how the initial rating of the security might
have differed if key rating input parameters were varied.
Parameter Sensitivities for the typical EMEA RMBS transaction are
calculated by stressing key variable inputs in Moody's primary
rating model.

The Foreign Account Tax Compliance Act (FATCA), a US legislation,
may impact the transaction. The regulations implementing the Act
are still in draft form and Moody's is currently reviewing the
potential impact of FATCA. Should this transaction become subject
to US withholding tax under FATCA the rating of the Notes may be
negatively impacted.

The V Score for this transaction is Low/Medium, which is in line
with the V Score assigned for the Dutch RMBS sector, mainly due
to the fact that it is a standard Dutch prime RMBS structure for
which Moody's has over 13 years of historical performance data on
precedent transactions. The primary source of uncertainty is due
to operational risks relating to the servicing arrangement. The
contractual servicer (NIBC) is rated Baa3/P-3 by Moody's. This
risk is mitigated by the fact that Stater Nederland N.V. will be
appointed at closing as sub-agent of NIBC and will perform the
loan administration.

V Scores are a relative assessment of the quality of available
credit information and of the degree of dependence on various
assumptions used in determining the rating. High variability in
key assumptions could expose a rating to more likelihood of
rating changes. The V Score has been assigned according to the
report "V Scores and Parameter Sensitivities in the Major EMEA
RMBS Sectors" published in April 2009.

The principal methodology used in this rating was Moody's
Approach to Rating RMBS in Europe, Middle East, and Africa
published in June 2012.

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

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

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

Moody's will monitor this transaction on an ongoing basis.


DUTCH MBS XVII: Fitch Assigns 'B' Rating to EUR6.5MM Cl. E Notes
----------------------------------------------------------------
Fitch Ratings has assigned Dutch MBS XVII B.V.'s EUR526,500,000
mortgage-backed notes final ratings, as follows:

  -- EUR135,000,000 floating-rate class A1 mortgage-backed notes:
     'AAAsf'; Outlook Stable;
  -- EUR365,000,000 floating-rate class A2 mortgage-backed notes:
     'AAAsf'; Outlook Stable;
  -- EUR8,000,000 floating-rate class B mortgage-backed notes:
     'AA+sf'; Outlook Stable;
  -- EUR7,000,000 floating-rate class C mortgage-backed notes:
     'A+sf'; Outlook Stable;
  -- EUR5,000,000 floating-rate class D mortgage-backed notes:
     'BBB+sf'; Outlook Stable;
  -- EUR6,500,000 floating-rate class E mortgage-backed notes:
     'Bsf'; Outlook Stable;
  -- EUR2,700,000 floating-rate non-collateralized class F notes:
     'NRsf'.:

This EUR526.5 million transaction is a true sale securitization
of Dutch residential mortgage loans, originated in the
Netherlands and owned by NIBC Bank N.V. (NIBC,
'BBB'/Negative/'F3').  The final ratings are based on Fitch's
assessment of the underlying collateral, available credit
enhancement (CE), the origination and underwriting procedures
used by the seller's, the servicing capabilities of NIBC and
STATER Nederland and the transaction's sound legal structure.

The transaction is backed by a nine-year seasoned non-revolving
portfolio of prime residential mortgage loans, with a relatively
low weighted-average (WA) original loan-to-market-value (LTMV) of
74.2% and a debt-to-income ratio (DTI) of 28.0%.  The purchase of
further advances into the pool will not be allowed after closing

CE for the class A notes totaled 5.5% at closing, which is
provided by the subordination of the class B notes (1.5%), the
class C notes (1.3%) the class D notes (0.9%), the unrated class
E notes (1.2%) and the reserve account (0.50%).  The transaction
benefits from a fully funded non-amortizing reserve account
equating to 0.50% of the initial class A to E notes balance and a
cash advance facility equating to 1.5% of the outstanding class A
to E notes balance, which may amortize to 0.75% of the initial
class A to E notes balance.  Under the interest rate swap
agreement, the swap counterparty pays the interest on the notes
in exchange for the scheduled interest on the mortgages, interest
earned on the guaranteed investment contract account, less senior
fees and excess spread of 0.50%.

The collateral review of the mortgage portfolio involves
reviewing vintage performance data and loan-by-loan loss severity
information on the originator's sold repossessions, which Fitch
uses to validate the frequency of foreclosure assumptions, quick
sale adjustments and foreclosure timing assumptions used within
its analysis.  Whilst NIBC was unable to provide cumulative
default data by vintage, it did provide static three-months plus
arrears data by vintage for both NHG and non-NHG loans and loan-
by-loan repossession data on all loans foreclosed over the past
few years.  This data was found to be in line with Fitch's
performance assumptions for the Dutch market and consequently no
additional adjustments to the standard assumptions were made.

To analyze the CE levels, Fitch evaluated the collateral using
its default model, details of which can be found in the reports
entitled "EMEA Residential Mortgage Loss Criteria", dated 7 June
2012, "EMEA RMBS Criteria Addendum - Netherlands", dated 14 June
2012, available at www.fitchratings.com.  The agency assessed the
transaction cash flows using default and loss severity
assumptions under various structural stresses including
prepayment speeds and interest rate scenarios.  The cash flow
tests showed that each class of notes could withstand loan losses
at a level corresponding to the related stress scenario without
incurring any principal loss or interest shortfall and can retire
principal by the legal final maturity

In Fitch's view, commingling risk is minimal due to the use of a
foundation structure.  Consequently, the agency did not consider
the risk of a loss of funds due to commingling or disruption of
payments in its cash flow analysis.  The transaction is not
exposed to the risk of deposit set-off or other claims.  Fitch
did incorporate in its analysis the risk that borrowers might
exercise set-off following the failure of insurance providers.


NORTHERN LIGHTS: Moody's Assigns 'Ba3' Rating to US$150MM LPNs
--------------------------------------------------------------
Moody's Investors Service has assigned the following definitive
rating to notes issued by Northern Lights Bulgaria B.V.:

    US$150,000,000 Loan Participation Notes due 2014
    Series 2012-1, Definitive Rating Assigned Ba3

Ratings Rationale

The rating of the Notes addresses the expected loss posed to
investors by the legal final maturity, and is based on the long
term senior unsecured rating of Corporate Commercial Bank AD.

The issue proceeds from the Notes will be used to fund a facility
agreement made between the Issuer as lender and Corporate
Commercial Bank AD as receiver. Payments received by the Issuer
under the Facility Agreement will be used to make payments due
under the Notes.

Given the pass through nature of the transaction, holders of the
notes will have effectively similar credit risk exposure to that
of the facility receiver Corporate Commercial Bank AD.

The principal methodology used in this rating was Moody's
Approach to Rating Repackaged Securities published in April 2010.

No cash flow analysis or stress scenarios have been conducted as
the rating was directly derived from the rating of the facility
receiver.



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


NATIONAL STANDARD: Moody's Assigns Rating to Domestic Bonds
-----------------------------------------------------------
Moody's Interfax has assigned Baa3.ru long-term National Scale
Rating to the domestic rouble-denominated bonds issued in March
2011 by National Standard Bank (NS-Bank). The issue size is
RUB1.5 billion (approximately US$50 million) with a maturity of
three years.

Ratings Rationale

Moody's notes that the Baa3.ru rating for the bonds is primarily
based on the fundamental ability of NS-Bank to make timely
payments of interest and ultimate payment of principal on the
bonds. The bonds have an embedded annual put option, which allows
bondholders to receive early repayment of the bonds' face value.
The next and last put option period is March 4, 2013 to March 10,
2013.

NS-Bank is currently rated B3/Not Prime for global long- and
short-term foreign and local currency deposits, and E+ for
standalone bank financial strength rating (BFSR) mapping to b3 on
the long-term scale. All of the bank's global scale ratings carry
a stable outlook.

What Could Move The Ratings Up/Down

A material reduction in the loan portfolio concentrations and
improved profitability are key factors that could exert upside
pressure on the ratings.

The ratings may be downgraded from a significant weakening of the
bank's liquidity and asset quality, or due to a material increase
in borrower concentration.

Principal Methodologies

The principal methodology used in this rating was Moody's
Consolidated Global Bank Rating Methodology published in June
2012.

National Standard Bank is headquartered in Moscow and reported
total assets and net income of $1.4 billion and $8.5 million,
respectively, as of year-end 2011, according to the bank's
audited financial statements.

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

                About Moody's and Moody's Interfax

Moody's Interfax Rating Agency (MIRA) specializes in credit risk
analysis in Russia. MIRA is a joint-venture between Moody's
Investors Service, a leading provider of credit ratings, research
and analysis covering debt instruments and securities in the
global capital markets, and the Interfax Information Services
Group. Moody's Investors Service is a subsidiary of Moody's
Corporation (NYSE: MCO).


NATIONAL STANDARD: Moody's Assigns 'B3' Sr. Unsecured Debt Rating
-----------------------------------------------------------------
Moody's Investors Service has assigned a B3 long-term local
currency senior unsecured debt rating to the domestic rouble-
denominated bonds issued in March 2011 by National Standard Bank
(NS-Bank). The outlook on the debt rating is stable. The issue
size is RUB1.5 billion (approximately US$50 million) with a
maturity of three years.

Ratings Rationale

Moody's notes that the B3 local currency debt rating for the
bonds are primarily based on the fundamental ability of NS-Bank
to make timely payments of interest and ultimate payment of
principal on the bonds. The bonds have an embedded annual put
option, which allows bondholders to receive early repayment of
the bonds' face value. The next and last put option period is
March 4, 2013 to March 10, 2013.

NS-Bank is currently rated B3/Not Prime for long- and short-term
foreign and local currency deposits, and E+ for standalone bank
financial strength rating (BFSR) mapping to b3 on the long-term
scale. All of the bank's ratings carry a stable outlook.

What Could Move The Ratings Up/Down

A material reduction in the loan portfolio concentrations and
improved profitability are key factors that could exert upside
pressure on the ratings.

The ratings may be downgraded from a significant weakening of the
bank's liquidity and asset quality, or due to a material increase
in borrower concentration.

Principal Methodologies

The principal methodology used in this rating was Moody's
Consolidated Global Bank Rating Methodology published in June
2012.

National Standard Bank is headquartered in Moscow and reported
total assets and net income of US$1.4 billion and US$8.5 million,
respectively, as of year-end 2011, according to the bank's
audited financial statements.


NS FINANCE: Moody's Assigns Rating to Domestic Bonds
----------------------------------------------------
Moody's Interfax Rating Agency has assigned Baa3.ru long-term
National Scale Rating to the domestic rouble-denominated bonds
issued in May 2011 by NS Finance, a wholly owned subsidiary of
National Standard Bank (NS-Bank). National scale ratings carry no
specify outlook. The issue size is RUB2 billion (approximately
$65 million) with a maturity of three years.

Ratings Rationale

Moody's notes that the Baa3.ru rating for the bonds are primarily
based on the fundamental ability of NS-Bank to make timely
payments of interest and ultimate payment of principal on the
bonds. NS Finance has been established for the sole purpose of
attracting funding for NS-Bank. The obligations of NS Finance to
bondholders are guaranteed by a surety from NS-Bank. The bank and
its subsidiary are jointly liable on the bonds.

NS-Bank is currently rated B3/Not Prime for global long- and
short-term foreign and local currency deposits, and E+ for
standalone bank financial strength rating (BFSR) mapping to b3 on
the long-term scale. All of the bank's global scale ratings carry
a stable outlook.

What Could Move The Ratings Up/Down

A material reduction in the loan portfolio concentrations and
improved profitability are key factors that could exert upside
pressure on the ratings.

The ratings may be downgraded from a significant weakening of the
bank's liquidity and asset quality, or due to a material increase
in borrower concentration.

Principal Methodologies

The principal methodology used in this rating was Moody's
Consolidated Global Bank Rating Methodology published in June
2012.

National Standard Bank is headquartered in Moscow and reported
total assets and net income of US$1.4 billion and US$8.5 million,
respectively, as of year-end 2011, according to the bank's
audited financial statements.

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

              About Moody's and Moody's Interfax

Moody's Interfax Rating Agency (MIRA) specializes in credit risk
analysis in Russia. MIRA is a joint-venture between Moody's
Investors Service, a leading provider of credit ratings, research
and analysis covering debt instruments and securities in the
global capital markets, and the Interfax Information Services
Group. Moody's Investors Service is a subsidiary of Moody's
Corporation.


NS FINANCE: Moody's Assigns 'B3' Senior Unsecured Debt Rating
-------------------------------------------------------------
Moody's Investors Service has assigned a B3 long-term local
currency senior unsecured debt rating to the domestic rouble-
denominated bonds issued in May 2011 by NS Finance, a wholly
owned subsidiary of National Standard Bank (NS-Bank). The outlook
on the debt rating is stable. The issue size is RUB2 billion
(approximately US$65 million) with a maturity of three years.

Ratings Rationale

Moody's notes that the B3 local currency debt rating for the
bonds are primarily based on the fundamental ability of NS-Bank
to make timely payments of interest and ultimate payment of
principal on the bonds. NS Finance has been established for the
sole purpose of attracting funding for NS-Bank. The obligations
of NS Finance to bondholders are guaranteed by a surety from NS-
Bank. The bank and its subsidiary are jointly liable on the
bonds.

NS-Bank is currently rated B3/Not Prime for long- and short-term
foreign and local currency deposits, and E+ for standalone bank
financial strength rating (BFSR) mapping to b3 on the long-term
scale. All of the bank's ratings carry a stable outlook.

What Could Move The Ratings Up/Down

A material reduction in the loan portfolio concentrations and
improved profitability are key factors that could exert upside
pressure on the ratings.

The ratings may be downgraded from a significant weakening of the
bank's liquidity and asset quality, or due to a material increase
in borrower concentration.

Principal Methodologies

The principal methodology used in this rating was Moody's
Consolidated Global Bank Rating Methodology published in June
2012.

National Standard Bank is headquartered in Moscow and reported
total assets and net income of US$1.4 billion and US$8.5 million,
respectively, as of year-end 2011, according to the bank's
audited financial statements.



===============
S L O V E N I A
===============


* SLOVENIA: Moody's Says Banking System Outlook Remains Negative
----------------------------------------------------------------
The outlook on Slovenia's banking system remains negative, says
Moody's Investors Service in a new Banking System Outlook
published recently. The negative outlook reflects a persistently
difficult operating environment and severe asset-quality
deterioration, particularly in the highly leveraged corporate
sector.

The new report is entitled "Banking System Outlook: Slovenia".

Moody's expects the operating environment for Slovenian banks to
remain challenging with a 2% contraction in Slovenia's real GDP
in 2012 and a further 1.4% in 2013. This difficult operating
environment will continue to weigh on fragile business confidence
and limit demand for credit.

Moody's also notes that the asset-quality ratios, capitalization
levels and provisioning buffers of Slovenian banks remain among
the weakest in Central and Eastern Europe. Moody's also expects
that unless the country's three leading banks are further
recapitalized, the banking system could struggle to significantly
reverse the downward trends and resume intermediation and lending
activities to the economy.

Slovenia banks' high dependence on wholesale funding will remain
a major challenge in Moody's view as they face difficult
refinancing conditions amidst volatile international markets.
However, Moody's notes that this reliance on wholesale market
funding has been partially mitigated by access to medium-term
funds provided by the European Central Bank.

Owing largely to increasing loan loss provisions, Moody's expects
the Slovenian banking system to remain loss-making over the
outlook period despite stable trends in gross operating income
and core profitability until now. The rating agency also expects
deleveraging and contraction in lending to translate into lower
interest margins and fee income while their funding costs are
likely to increase as competition intensifies for the limited
pool of domestic deposits to replace maturing wholesale
liabilities.



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


CLINTON CARDS: American Greetings Buys Stores, Brand
----------------------------------------------------
Carla Main, substituting for Bloomberg bankruptcy columnist Bill
Rochelle, reports that American Greetings Corp. disclosed in an
annual report to the U.S. Securities and Exchange Commission that
it bought stores and financial assets from Clinton Cards Plc, a
U.K. greeting card business in administration, a process similar
to Chapter 11 bankruptcy in the U.S.

According to the report, before entering administration, Clinton
Cards had 750 stores and annual revenue of about US$600 million
and had long been one of American Greetings' "largest customers,"
the U.S. company said in the SEC filing.  Before the May 9
administration filing, American Greetings, through its unit,
Lakeshore Lending Ltd., purchased all the outstanding senior
secured debt of Clinton for US$56.6 million.  An administration
auction was conducted June 7 and Clinton sold some units to
Lakeshore for US$37.2 million.  The bid took the form of a
"credit bid" under which American Greetings used a portion of the
senior secured debt Clinton owed to Lakeshore to pay the purchase
of the assets, according to the SEC filing.

The Bloomberg report discloses that under the auction agreement,
American Greetings would acquire 400 stores, complete with
inventory and overhead, "as well as the Clinton Cards and related
brands," according to the filing.  The stores and assets that
weren't acquired remain subject to the U.K. administration
proceeding.  It's anticipated these assets "will be liquidated,"
American Greetings said in its filing.

Based in Cleveland, Ohio, American Greetings Corporation
(NYSE:AM) is engaged in the design, manufacture and sale of
everyday and seasonal greeting cards, and other social expression
products.


JJB SPORTS: Crewe Store Closes Following Administration
-------------------------------------------------------
Ellie Cullen at Crewe Chronicle.co.uk reports that twelve staff
at JJB Sports in Crewe have lost their jobs after the store shut
its doors with immediate effect.

A total of 133 stores across the country were closed when the
company officially went into administration, according to
Chronicle.co.uk.

The report relates that only 50 shops were saved from closure
after they were bought by rival sports retailer Sports Direct --
but the Crewe Market Centre store was not one of them.

KPMG had been appointed as administrators.

The report notes that 167 employees across the company have been
retained to assist the administrators with one from Crewe.

"Successive attempts to restructure the business, both
financially and operationally, have not been enough to prevent
the company falling into administration . . . .  Unfortunately a
buyer could only be found for 20 stores on a going concern basis.
All staff made redundant as a result of store closures have had
their arrears of wages and holiday entitlements paid in full . .
. .  Our team of employment specialists will be supporting staff
on completing redundancy forms and putting them in touch with job
seeker services . . . .  We will now be reviewing what options
are available for the remainder of the business, such as selling
leasehold interests," the report quoted Richard Fleming, UK head
of restructuring at KPMG, as saying.

The report discloses that David McCorquodale, corporate finance
partner who led the sales process, added: "Unfortunately, the
level of cash and further restructuring required to rescue a
substantial part of the business was too much risk for most
interested parties."


OPTICAL EXPRESS: Unit in Administration, Closes 40 Stores
---------------------------------------------------------
Tiffany Holland at Retail Week reports that Optical Express is to
close 40 stores after plunging its subsidiary into administration
in the face of a "significant economic slowdown on the high
street."



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


* 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
139 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 * * *