TCREUR_Public/130131.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

           Thursday, January 31, 2013, Vol. 14, No. 22



PEUGEOT CITROEN: Court Orders Restructuring Plan Halt
* FRANCE: Is "Totally Bankrupt," Employment Minister Says


INFINITY 2007-1: Fitch Lowers Rating on Class E Notes to 'CCsf'
PB DOMICILE 2006-1: S&P Withdraws 'BB' Rating on Class E Notes


* GREECE: More Than 2,000 Companies Apply for Creditor Protection


* ICELAND: EFTA Court's Icesave Ruling Positive, Fitch Says


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


BANCA MONTE: Bank of Italy Aware of Accounting Irregularities
DEWEY & LEBOEUF: Judge Okays Settlement with Italian Affiliates
INTESA SANPAOLO: Fitch Affirms 'BB+' Tier 1 Instruments Rating
SEAT PAGINE: Suspends Interest Payment; Reviews Business Plan


TELCO UAB: S&P Puts 'B-' Corp. Rating on CreditWatch Positive


BITE FINANCE: Moody's Rates EUR200MM Sr. Secured Notes '(P)B3'
SNS REAAL: S&P Lowers Rating on Non-Deferrable Debt to 'B-'


ALLIANCE OIL: Fitch Affirms 'B' Long-Term Issuer Default Rating


REYAL URBIS: Debts Talks with Creditors Ongoing
* SPAIN: Property Firms Seek for More Generous Debt Relief

U N I T E D   K I N G D O M

2E2 UK: Business in Administration After Failing to Secure Funds
ALBURN REAL: S&P Lowers Rating on Class A Notes to 'CCC-'
CORNERSTONE TITAN: S&P Cuts Rating on Class F Notes to 'CCC'
GEMINI ECLIPSE: S&P Lowers Ratings on Two Note Classes to 'CCC-'
LEMMA EUROPE: Gibraltar Court Issues Wind-Up Order

MANCHESTER AIRPORT: In Administration After Sharp Fall in Orders
PHOENIX GROUP: Plans to Raise GBP250-Mil. From Share Placement
RENEWABLE ENERGY: S&P Affirms 'B+' Corporate Credit Rating
* UK: Business Insolvencies Fall in 2012, Experian Data Shows


* Upcoming Meetings, Conferences and Seminars



PEUGEOT CITROEN: Court Orders Restructuring Plan Halt
Heather Smith and Mathieu Rosemain at Bloomberg News report that
PSA Peugeot Citroen was ordered by a court to pause its
restructuring plans as auto workers across France went on strike
to protest industry-wide job cuts amid signs the decline in
European car demand is accelerating.

Workers burned tires and blocked access to some Renault SA
factories and protested outside a Peugeot plant in a Paris suburb
that is set to close, Bloomberg relates.  According to Bloomberg,
a court in the French capital said separately that Peugeot can't
eliminate jobs until a parts supplier that it controls tells
workers how they may be affected by the automaker's

The two companies are struggling to convince French labor leaders
to go along with plans to eliminate 18,700 positions, or roughly
17% of their workforces in the country, as Europe's auto market
plunges for a sixth straight year, Bloomberg discloses.

French workers are shielded by labor laws requiring employers to
take extensive steps to ensure employees are regularly and fully
informed about job-cut proposals, Bloomberg notes.  Faurecia SA,
57% owned by Peugeot, was ordered to inform its workers about the
impact of Peugeot's restructuring before the carmaker can
implement its plan, Bloomberg discloses.  Faurecia, Bloomberg
says, is itself aiming to cut about 3,000 jobs in its home region
by the end of 2013.

Peugeot plans to shrink its French automotive operations by
11,200 positions over the next two years, Bloomberg states.  The
automaker is also closing a factory in Aulnay on the outskirts of
Paris, selling assets and building a strategic alliance with
General Motors Co., Bloomberg notes.

"The effects of the restructuring under way at Peugeot haven't
been the subject of a consultation with the Faurecia" workers,
the court, as cited by Bloomberg, said in a ruling dated Jan. 28.
"As a result, there's grounds to order the suspension of the
restructuring" until Faurecia informs its workers.

Bloomberg relates that the automaker said in a statement the
court only ordered Peugeot not to execute the cuts until Faurecia
has consulted its workers, and that the ruling "neither suspended
and certainly didn't cancel" the restructuring program.
According to Bloomberg, Faurecia on Tuesday said it "will
undertake this consultation without delay."

PSA Peugeot Citroen S.A. --
-- is a France-based manufacturer of passenger cars and light
commercial vehicles.  It produces vehicles under the Peugeot and
Citroen brands.  In addition to its automobile division, the
Company includes Banque PSA Finance, which supports the sale of
Peugeot and Citroen vehicles by financing new vehicle and
replacement parts inventory for dealers and offering financing
and related services to car buyers; Faurecia, an automotive
equipment manufacturer focused on four component families: seats,
vehicle interior, front end and exhaust systems; Gefco, which
offers logistics services covering the entire supply chain,
including overland, sea and air transport, industrial logistics,
container management, vehicle preparation and distribution, and
customs and value added tax (VAT) representation, and Peugeot
Motocycles, which manufactures scooters and motorcycles.

                           *    *     *

As reported by the Troubled Company Reporter-Europe on Oct. 12,
2012, Moody's Investors Service downgraded to Ba3 from Ba2 the
ratings of Peugeot S.A. ("PSA") and its rated subsidiary GIE PSA
Tresorerie ("GIE"). This concludes the review initiated by
Moody's on July 26, 2012.  The outlook on the ratings is

"The rating action reflects the significant challenges facing PSA
to successfully restructure and turn around the operating
performance of its automotive operations, including achieving the
targeted break-even operating cash flow by 2014. Even if these
measures are timely implemented, these circumstances will stress
the company's metrics much beyond the existing rating category
for the next couple of years," says Falk Frey, a Moody's Senior
Vice President and lead analyst for PSA. "Given that we
anticipate a further decline of 3% in light vehicle demand and
increased pricing pressure in western Europe in 2013, PSA's
announced initiatives may not be sufficient for the group to
realise the financial results it is targeting within its
restructuring plan which is reflected in the negative outlook,"
adds Mr. Frey.

PSA faces significant challenges in its efforts to turn around
its loss-making automotive business and to reduce the currently
high cash burn within its operations by implementing announced
initiatives to reduce fixed costs and adjust capacities. These
challenges are exacerbated by a worsening market environment in
PSA's key European markets, with declining car demand and
increasing price pressure, especially in the small car segments.
In particular, as Moody's currently expects the downward trend in
new car sales in western Europe to continue well into 2013, PSA
might need to take further actions in order to stabilize its
operations and achieve the targeted turnaround as announced.
Based on Moody's calculations, should car demand in Europe remain
at current low levels, the initiated reduction in capacity at
Aulnay and Rennes of approximately 300,000 units might not be
sufficient for PSA to achieve sustainably solid profitability
well above break-even.

* FRANCE: Is "Totally Bankrupt," Employment Minister Says
John Hall at The Independent reports that France's employment
minister Michel Sapin has admitted the country is "totally

The unexpected news came during a radio interview on Monday and
is thought to have sent the country's business leaders into a
state of shock, the Independent relates.

"There is a state but it is a totally bankrupt state," the
Independent quotes Mr. Sapin as saying.  "That is why we had to
put a deficit reduction plan in place, and nothing should make us
turn away from that objective."

Mr. Sapin's "totally bankrupt" statement is likely to cause huge
embarrassment for President Francois Hollande, who will be left
to undo the potential damage to his socialist government's
reputation, the Independent says.

It also calls into further question Mr. Hollande's controversial
"tax and spend" policies that have seen numerous entrepreneurs
and high profile celebrities leave the country, the Independent

The comments came as President Hollande attempts to improve the
image of the French economy after pledging to reduce the
country's deficit by cutting spending by EUR60 billion (GBP51.5
billion) over the next five years and increasing taxes by EUR20
billion (GBP17 billion), the Independent discloses.


Becky Beetz at reports that Centrotherm
photovoltaics AG's insolvency plan has been approved, meaning the
German company can now look forward to terminating its insolvency
proceedings, pending final confirmation.

According to the report, the company's shareholders and creditors
approved the insolvency plan at a meeting organized on Jan. 29,
by the Ulm District Court.

While court confirmation and the satisfaction of final formal
conditions still need to be achieved, centrotherm is confident
its insolvency proceedings can be rescinded.  As such, it is
expected that all of the remaining 1,000 jobs can be maintained,
the report notes. says that under the reorganization plan, the
photovoltaics company intends to continue on as a stock listed
corporation. It is also looking to boost capital share via the
conversion of unsecured creditors' receivables into the company's

The report states that centrotherm's creditors are expected to
relinquish 70% of their receivables deemed unconditional and
without restriction to an independent administration company,
which will become a shareholder.

Overall, it is expected that share capital will be reduced by
EUR16.93 million to EUR4.23 million via a capital write down, and
then subsequently increased via a debt to equity swap to
EUR21.16 million.  The administration company will hold 80% of
centrotherm's shares for its creditors, which it will then sell
on, while remaining 20% will stay with the shareholders.

If the plan achieves final approval, expected at the end of this
month, centrotherm's previously announced management changes will
also become effective, says Efforts will further
be focused on the company's core business of production
technology for thermal surface processes in the photovoltaic
industry, the report notes.

"If we implement the plan as envisaged, it will comprise an
equally beneficial result for shareholders, employees and
creditors. For shareholders, millions of euros' worth of value,
the stock market listing and the value enhancement potentials of
their shares remain. Creditors stand a good chance of realizing
100 percent of their receivables, or even more,"
quotes Tobias Hoefer, Management Board member responsible for the
insolvency plan and the company's own administration, as saying.

"Last, but not least, all of the currently approximately 1,000
jobs within the centrotherm Group can also be maintained."

As reported in the Troubled Company Reporter-Europe on Oct. 3,
2012, the reorganization of centrotherm photovoltaics AG has
entered a decisive phase.  The District Court of Ulm on Oct. 1
granted the company's application to open reorganization
proceedings under its own administration.  The same also applies
for the subsidiaries centrotherm thermal solutions GmbH & Co. KG
and centrotherm SiTec GmbH, which have also been in insolvency
protection proceedings since July 12. The provisional creditor
committee had provided unanimous support to the application.

                        About centrotherm

photovoltaics AG centrotherm photovoltaics AG, which is based at
Blaubeuren, Germany, is a technology and equipment provider for
the photovoltaics sectors.  The Group currently employs around
1,300 staff, and operates globally in Europe, Asia and the USA.

INFINITY 2007-1: Fitch Lowers Rating on Class E Notes to 'CCsf'
Fitch Ratings has downgraded Infinity 2007-1 (SoPRANo)'s junior
commercial mortgage-backed floating rate notes (CMBS) ratings, as

EUR490.9m class A (FR0010478420) downgraded to 'AAsf' from
'AA+sf'; Outlook Negative

EUR39.6m class B (FR0010478438) downgraded to 'Asf' from 'AAsf';
Outlook Negative

EUR31.2m class C (FR0010478446) downgraded to 'BBsf' from 'Asf';
Outlook Negative

EUR25.6m class D (FR0010478453) downgraded to 'Bsf' from 'BBBsf';
Outlook Negative

EUR31.2m class E (FR0010478479) downgraded to 'CCsf' from 'BBsf';
Recovery Estimate 0%

The downgrade reflects Fitch's increased negative perception of
the secondary German retail market, an asset type that
characterizes the collateral in EHE Pool 1A, the largest loan in
the transaction which accounts for 57.4% of the aggregate pool
balance. Although the loan is currently sweeping all excess cash
and senior coverage remains strong at 2.36x, the agency fears
that a lack of asset sales over the past year (which is likely to
trigger a breach of the October 2013 EUR60 million disposal
threshold, a condition required to extend the loan for a further
12 months) highlights a further deterioration in investor
appetite for secondary assets. As such Fitch believes the
collateral backing the loan is not immune to further declines in
value, which would further increase the current securitized and
whole loan loan-to-value ratios (LTV) currently at 119.9% and
137.9% respectively.

The servicer Capita Asset Services ('CPS2+'/'CSS2'), has waived
an event of default under the EHE pool B loan (10% of aggregate
pool balance) caused by failure to meet the October 2012 disposal
targets, and has chosen the option of a managed sell down with
reviews every six months, a process that was envisioned at the
October 2011 extension and restructure. Although Fitch normally
views retaining the active involvement of borrowers as a positive
in protecting collateral value, in this case the waiver has
prevented a switch to sequential pay-down from the current
modified pro-rata rules. The agency believes this can be
detrimental for the senior class of noteholders, particularly in
a scenario where large assets are sold prior to the switch in the
principal waterfall being enacted.

Since the last rating action in January 2012, the EUR186.2m
Leipzig loan repaid in full in a modified pro-rata fashion. The
loan was backed by a large good quality shopping centre in
Leipzig. The agency did not expect any losses under the loan.

Of the remaining loans, eight are scheduled to mature in 2016
and, with the exception of the Massy loan (a 74.2% LTV loan
backed by a large retail warehouse in the outskirts of Paris and
contributing 4.7% of the pool balance), they can be characterized
as low risk due to the low LTVs and high coverage levels.

Infinity 2007-1 (SoPRANo), which closed in May 2007, is a
synthetic securitization which contains 14 commercial mortgage
loans originated in Germany, France and Spain by Natixis
('A+'/Negative/'F1+') and Capmark AB No.2.

Fitch will continue to monitor the performance of the

PB DOMICILE 2006-1: S&P Withdraws 'BB' Rating on Class E Notes
Standard & Poor's Ratings Services withdrew its credit ratings on
PB Domicile 2006-1 PLC's class D and E notes.

Since the early termination of the class A1+ to C notes on
Nov. 28, 2011, only the class D and E notes were outstanding in
PB Domicile 2006-1.

The withdrawal of S&P's ratings on the class D and E notes
follows its review of the PB Domicile 2006-1 transaction after
the withdrawal, on Jan. 4, 2013, of its ratings on Deutsche
Postbank AG.

Deutsche Postbank acts as originator, excess spread provider, and
loss guarantee counterparty in the PB Domicile 2006-1
transaction.  The ratings on the class D and E notes are
dependent on the rating on Deutsche Postbank because the latter
provides collateral to these tranches.  Since Standard & Poor's
no longer rates the collateral backing the class D and E notes,
it has withdrawn its ratings on the notes.

PB Domicile 2006-1 is a synthetic, partially funded German
residential mortgage-backed securities (RMBS) transaction.  PB
Domicile 2006-1 closed in September 2006, when S&P assigned its
ratings to the transaction.


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:



Class               Rating
            To              From

PB Domicile 2006-1 PLC
EUR182.6 Million Floating-Rate Credit-Linked Notes
and Deferrable Floating-Rate Credit-Linked Notes

Ratings Withdrawn

D           NR              BBB (sf)
E           NR              BB (sf)


* GREECE: More Than 2,000 Companies Apply for Creditor Protection
Eleni Chrepa at Bloomberg News, citing Naftemporiki, reports that
more than 2,000 Greek companies applied for creditor protection
under bankruptcy law between the start of the financial crisis in
2008 and the end of 2012.

According to Bloomberg, Naftemporiki said that there 640 requests
were filed in 2012, 174 of which were approved.  The newspaper
said that a total of 222 requests were rejected, while 244 were
pending, Bloomberg notes.

Bloomberg relates that the newspaper said 50% of the requests
were from companies in Athens and Thessaloniki, Greece's largest
cities.  Bloomberg notes that the newspaper said 33% of the
requests were from Athens.


* ICELAND: EFTA Court's Icesave Ruling Positive, Fitch Says
The European Free Trade Association (EFTA) Court's dismissal of
alleged claims that Iceland failed to comply with obligations to
Icesave depositors is positive for Iceland's sovereign credit
profile, but the continuing presence of capital controls still
weighs on the sovereign rating, Fitch Ratings says.

Monday's ruling removes a potential threat to Iceland's public
finances. A significant contingent liability for the state would
have been crystallized had the government been required to fund
the interest-servicing costs associated with the loans incurred
by the UK and Dutch governments when they reimbursed Icesave
depositors (up to the Icelandic deposit insurance scheme amount
of EUR20,000 per depositor). The Icelandic authorities estimated
that this liability could have been as high as 6.5% of GDP, while
IMF estimates were considerably higher.

The EFTA Court's dismissal of the application is consistent with
our baseline scenario that general government debt-to-GDP peaked
at 101% at end-2011, and will fall to below 70% by 2020 -
assuming a primary surplus of 4% of GDP (in line with the average
for 1998-2007), average nominal GDP growth of 5.4%, and average
nominal interest rates of 4.8%. An unfavorable ruling would have
slowed the fall in the public debt/GDP ratio.

More broadly for Iceland, the ruling appears to draw a line under
the protracted dispute, and removes the risk of the potentially
damaging fall-out for the economy and the exchange rate which an
adverse ruling might have had. The Icelandic authorities have
confirmed that payments from the estate of the failed Landsbanki
will continue regardless of the EFTA Court ruling.

The ruling marks a step towards normalizing relations with
external creditors, but capital controls remain a major stumbling
block. These support the currency and limit the risk caused by
currency mismatches, but they also hold back investment and
constrain economic growth. The Icelandic authorities continue to
adhere to a conditions-based policy for lifting capital controls,
and are exploring new avenues to accelerate the reduction in the
overhang of non-resident holdings of krona-denominated

Fitch says: "As we noted when we upgraded Iceland to 'BBB-' from
'BB+' in February last year, future sovereign rating actions will
take a range of factors into account -- including accelerated
private sector domestic debt restructuring, a progressive
unwinding of capital controls, normalization of relations with
external creditors, and enduring monetary and exchange-rate

The Outlook on the rating is Stable.


* IRELAND: Moody's Says Banking System Outlook Remains Negative
The outlook for Ireland's banking system remains negative, says
Moody's Investors Service in a new Banking System Outlook
published on Jan. 29. The outlook is unchanged since 2008 and
principally reflects the rating agency's view that the Irish
banking system has not yet fully stabilized, despite (1) the
removal of large real-estate portfolios from the banks' balance
sheets into the National Asset Management Agency (NAMA) in 2010
and 2011; and (2) the marginally positive, but still weak, GDP
growth that Moody's expects to continue in 2013.

The system outlook also captures Moody's view that Irish banks
will remain under pressure over the next 12 to 18 months due to
(1) ongoing asset-quality deterioration, more recently stemming
from poor residential mortgage loan performance; (2) their
continued, albeit reducing, dependence on central bank funding;
and (3) weak profitability and internal capital generation.

The new report, entitled "Banking System Outlook: Ireland", is
now available on Moody's subscribers can access
this report via the link provided at the end of this press

As noted in "Credit Analysis: Ireland, Government of" (November
14, 2012) Moody's expects the Irish economy to grow at a slower
pace in 2012 and 2013 (at 0.2% and 1.1% respectively), following
GDP growth of 1.4% in 2011 [Source: Moody's Sovereign Risk
Group]. The country's growth prospects remain weak due to the
fiscal consolidation process, the ongoing deleveraging in the
private sector, and subdued external demand. Additional factors
that will exacerbate the banks' challenging operating environment
and constrain a return to banking stability are the uncertain
economic outlook for key trading partners (especially the UK and
the euro area), and the ongoing euro area crisis.

Moody's expects bank asset quality to remain weak, because it
will likely take the banks several more years to fully resolve
the legacy issues from the crisis. Although the vast bulk of the
land and development loans were transferred to NAMA, arrears
remain high on the remaining property exposures. The asset
quality of the banks' residential mortgage books will also remain
very weak, although Moody's recognizes that increases in arrears
are beginning to slow.

Ongoing liquidity support from the ECB remains vital for the
banks. The removal of the extraordinary guarantee (ELG) for
deposits over EUR100,000, expected in H1 2013, will provide
further evidence of the system's recovery process and although
the removal of the ELG could lead to some deposit outflows,
Moody's does not expect that these will be substantial. In
addition, Moody's says that profitability across the sector is
likely to remain negative or low during the next few years,
further supporting the negative outlook, due to (1) sustained
high levels of provisions; (2) high funding costs; (3) lower top-
line revenues due to muted demand and low interest rates; and (4)
the high proportion of low yielding "tracker mortgages" tied to
ECB rates.


BANCA MONTE: Bank of Italy Aware of Accounting Irregularities
Elisa Martinuzzi, Sonia Sirletti and Lorenzo Totaro at Bloomberg
News report that the Bank of Italy under former Governor Mario
Draghi spotted accounting irregularities that allowed Banca Monte
dei Paschi di Siena SpA to mask losses more than two years before
the lender was forced to say it will have to restate profit.

According to Bloomberg, Italy's Rome-based central bank said in a
report dated Jan. 28 that in 2010, "a problem came to light" on
Monte Paschi's booking of a structured deal called Santorini.
The Bank of Italy alerted "other authorities" a year later and
talks with those regulators, which it didn't identify, haven't
concluded, Bloomberg relates.  It didn't explain the delay in
forcing the bank to disclose the information, Bloomberg notes.

The Bank of Italy's account of Monte Paschi's use of derivatives,
released on Tuesday, calls into question its oversight of the
world's oldest bank, which is seeking the second taxpayer bailout
in four years, Bloomberg discloses.

The Bank of Italy said that as early as 2010, it sought daily
liquidity reports from the lender as margin calls on Santorini
drained funds, Bloomberg relates.  The regulator said a week ago
Monte Paschi hid documents, impeding its analysis of the "true
nature" of the company's dealings, Bloomberg recounts.

According to Bloomberg, Finance Minister Vittorio Grilli said in
parliament on Tuesday that regulatory oversight of Monte Paschi
was "continuous and thorough" and the bank remains solid even
with a capital shortfall and possible losses linked to structured

Santorini helped Monte Paschi obscure a EUR367 million loss from
an older derivative contract with Deutsche Bank, according to
more than 70 pages of documents outlining the deal and obtained
by Bloomberg News.  As part of the arrangement, the Italian
lender made a losing bet on the value of the country's government
bonds, Bloomberg says.  The bank's new management is still trying
to determine the extent to which Santorini and two other
derivative deals were used to distort earnings, Bloomberg notes.
Monte Paschi never disclosed the effect of the 2008 deal in its
annual reports, Bloomberg discloses.

Italy's third-largest bank and prosecutors are now reviewing
three money-losing derivative deals, Santorini, Alexandria and
Nota Italia, Bloomberg discloses.  The lender said it discovered
in October that former managers signed a "mandate agreement" with
Nomura Holdings Inc. (8604) to cover losses on a mortgage-backed
derivative called Alexandria with new, riskier derivatives,
Bloomberg relates.

The hidden document, proving the link between the unprofitable
Alexandria derivative with the new one, should have led the bank
to book a loss of more than EUR200 million on the original
transaction, instead of spreading it over the 30- year maturity
of the new deal, Bloomberg says.

Monte Paschi Chief Executive Officer Fabrizio Viola, who took the
helm a year ago, said Jan. 28 the bank has been unable to find a
similar mandate agreement for the Santorini financing, Bloomberg

Mr. Viola, as cited by Bloomberg, said that Monte Paschi will
complete the review of the losses, which haven't been quantified
yet, in the first half of February, and they will be included in
the bank's 2012 accounts.

Mr. Grilli testified in parliament on Tuesday to defend the
government's plan to grant a EUR3.9 billion (US$5.3 billion)
rescue as lawmakers ask whether the lender still deserves the
aid, Bloomberg discloses.

Tuesday's testimony by Mr. Grilli follows a meeting on Monday in
Milan between Mr. Grilli and European Central Bank President
Mario Draghi, who headed Italy's central bank when some of the
secret, structured-finance deals were undertaken, Bloomberg

As reported by the TCR-Europe on Jan. 28, 2013, Bloomberg News
related that the Bank of Italy approved EUR3.9 billion
(US$5.3 billion) in emergency loans for Monte Paschi, meaning
Prime Minister Mario Monti may have to push ahead with the
unpopular bailout before elections next month.  The decision
comes amid a political firestorm over rescuing the world's oldest
bank after revelations the lender's former management hid details
of structured-finance transactions from regulators that may
produce hundreds of millions of euros in losses, Bloomberg
disclosed.  The Bank of Italy made its announcement on Jan. 26, a
day after Monte Paschi shareholders approved EUR6.5 billion in
capital increases needed to secure the loans, Bloomberg noted.

Banca Monte dei Paschi di Siena SpA -- 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.

DEWEY & LEBOEUF: Judge Okays Settlement with Italian Affiliates
Brian Mahoney of BankruptcyLaw360 reported that a New York
federal bankruptcy judge Friday approved a EUR5.3 million
(US$7.1 million) settlement reached by the estate of the bankrupt
Dewey & LeBoeuf LLP with former partners of the firm's Italian
practice who left Dewey before it filed for bankruptcy in 2012.

U.S. Bankruptcy Judge Martin Glenn authorized a settlement
whereby Dewey will receive EUR3.4 million from partners of
successor firm Grimaldi Studio Legale, which was formed by Dewey
partners in 2012 as the firm hurtled toward bankruptcy, the
report said.

                       About Dewey & LeBoeuf

Dewey & LeBoeuf LLP sought Chapter 11 bankruptcy (Bankr. S.D.N.Y.
Case No. 12-12321) to complete the wind-down of its operations.
The firm had struggled with high debt and partner defections.
Dewey disclosed debt of US$245 million and assets of US$193
million in its chapter 11 filing late evening on May 29, 2012.

Dewey & LeBoeuf LLP operated as a prestigious, New York City-
based, law firm that traced its roots to the 2007 merger of Dewey
Ballantine LLP -- originally founded in 1909 as Root, Clark &
Bird -- and LeBoeuf, Lamb, Green & MacCrae LLP -- originally
founded in 1929.  In recent years, more than 1,400 lawyers worked
at the firm in numerous domestic and foreign offices.

At its peak, Dewey employed about 2,000 people with 1,300 lawyers
in 25 offices across the globe.  When it filed for bankruptcy,
only 150 employees were left to complete the wind-down of the

Dewey's offices in Hong Kong and Beijing are being wound down.
The partners of the separate partnership in England are in
process of winding down the business in London and Paris, and
administration proceedings in England were commenced May 28.  All
lawyers in the Madrid and Brussels offices have departed.  Nearly
all of the lawyers and staff of the Frankfurt office have
departed, and the remaining personnel are preparing for the
closure.  The firm's office in Sao Paulo, Brazil, is being
prepared for closure and the liquidation of the firm's local
affiliate.  The partners of the firm in the Johannesburg office,
South Africa, are planning to wind down the practice.

The firm's ownership interest in its practice in Warsaw, Poland,
was sold to the firm of Greenberg Traurig PA on May 11 for
US$6 million.  The Pension Benefit Guaranty Corp. took $2 million
of the proceeds as part of a settlement.

Judge Martin Glenn oversees the case.  Albert Togut, Esq., at
Togut, Segal & Segal LLP, represents the Debtor.  Epiq Bankruptcy
Solutions LLC serves as claims and notice agent.  The petition
was signed by Jonathan A. Mitchell, chief restructuring officer.

JPMorgan Chase Bank, N.A., as Revolver Agent on behalf of the
lenders under the Revolver Agreement, hired Kramer Levin Naftalis
& Frankel LLP.  JPMorgan, as Collateral Agent for the Revolver
Lenders and the Noteholders, hired FTI Consulting and Gulf
Atlantic Capital, as financial advisors.  The Noteholders hired
Bingham McCutchen LLP as counsel.

The U.S. Trustee formed two committees -- one to represent
unsecured creditors and the second to represent former Dewey
partners.  The creditors committee hired Brown Rudnick LLP led by
Edward S. Weisfelner, Esq., as counsel.  The Former Partners
hired Tracy L. Klestadt, Esq., and Sean C. Southard, Esq., at
Klestadt & Winters, LLP, as counsel.

Dewey filed a Chapter 11 Plan of Liquidation and an accompanying
Disclosure Statement on Nov. 21, 2012.  It filed amended plan
documents on Dec. 31, in an attempt to address objections lodged
by various parties.  A second iteration was filed Jan. 7, 2013.

The plan is based on a proposed settlement between secured
lenders and Dewey's official unsecured creditors' committee.  It
also incorporates a settlement approved by the bankruptcy court
in October where 440 former partners will receive releases in
return for $71.5 million in contributions.

INTESA SANPAOLO: Fitch Affirms 'BB+' Tier 1 Instruments Rating
Fitch Ratings has affirmed Intesa Sanpaolo SpA and UniCredit
S.p.A.'s Long-term Issuer Default Ratings (IDR) and Viability
Ratings (VR) at 'A-' and 'a-', respectively, Unione di Banche
Italiane - UBI Banca's at 'BBB+' and 'bbb+', respectively, and
Banco Popolare's at 'BBB' and 'bbb', respectively. The Outlook on
Intesa Sanpaolo's, UniCredit's and UBI Banca's Long-term IDR is
Negative, the Outlook on Banco Popolare's is Stable. At the same
time the agency affirmed the ratings of the banks' subsidiaries
and debt securities.

Rating Action Rationale

The affirmations reflect Fitch's view of the banks' ability to
manage the continued difficult operating environment in Italy,
where the agency expects real GDP to contract by 0.7% in 2013 as
the country will exit recession only in the second half of the
year. The agency's outlook on the banking sector is negative as
earnings remain under pressure in a low-interest rate environment
where loan impairment charges are expected to remain high into
2014. Impaired loans continued to rise in 9M12, and asset quality
has deteriorated substantially. Fitch expects that impaired loans
will continue to increase in 2013 given the weak domestic growth.

The reviewed banks all reported stronger capital ratios in 2012.
Ratios improved as a result of increased capital and disposals of
non-core assets, but, in the case of Banco Popolare and UBI
Banca, were also boosted following approval to use advanced
approaches for the calculation of regulatory capital requirements
in 2012. Fitch believes that maintaining sound capital ratios
will be important for these banks given the increased volumes of
impaired loans. Liquidity improved and is, in Fitch's opinion,
generally adequate in the current market context, despite a
challenging funding environment in 2012. Banco Popolare, Intesa
Sanpaolo and UBI Banca reported estimated end-September 2012
Basel III liquidity coverage ratios (LCR) and net stable funding
ratios (NSFR) above 100%. These ratios are helped by the banks'
access to longer-term ECB funding, but Fitch also expects the
banks to maintain adequate liquidity given their solid customer
franchises and continued growth in domestic customer deposits.

The Outlooks on the Long-term IDRs of Intesa Sanpaolo, UniCredit
and UBI Banca remain Negative and reflects Fitch's view that the
IDRs could be downgraded if the financial position of the banks
deteriorated more than expected, which could be caused by a
longer protraction of the recession. The Negative Outlook on
Intesa Sanpaolo's and UniCredit's Long-term IDR also reflects
Fitch's view that the bank's rating, which is at the same level
as the sovereign rating, would likely be downgraded if the
sovereign rating was downgraded. This reflects the high
correlation between bank and sovereign ratings. The Outlook on
Banco Popolare's Long-term IDR is Stable as its IDR is at the
same level as its Support Rating Floor (SRF), because a downgrade
of its VR would result in a downgrade of its Long-term IDR only
if its SRF was also revised.



The affirmation of Banco Popolare's VR and IDRs reflects its
adequate capitalisation, weak but improving earnings, its
adequate funding profile and its strong franchise in some of
Italy's wealthiest regions, but also the bank's weak asset
quality. As Banco Popolare's VR is at its SRF, a downgrade of the
VR would result in a downgrade of the Long-term IDR only if the
SRF was also revised. The rating drivers and sensitivities for
Banco Popolare's support-driven ratings are listed below.

Banco Popolare's operating profitability in 9M12 remained weak
with an operating return on average equity (ROAE) of 2.7% but
improved as the bank benefited from gains on securities and
generated solid fees and commissions. Fitch expects profitability
to remain under pressure in 2013, but the bank's efforts to
improve efficiency should underpin profitability. The bank's VR
would come under pressure if prospects for its operating
profitability deteriorated while a material sustained
strengthening of operating performance, which Fitch does not
expect in the short-term, would be required to put upward
pressure on ratings.

Asset quality is weak as the bank's gross impaired loans/gross
loans ratio reached a high 12.1% at end-September 2012, above its
peers' average. The bank's large portfolio of impaired loans is
partly a legacy from the acquisition of Banca Italease in 2009,
whose gross impaired loans at end-September 2012 accounted for
over 20% of the group's total impaired loans.

Loan impairment allowance coverage of impaired loans at Banco
Popolare is weak at 35.7% which is lower than most peers'.
Including real estate collateral covering doubtful loans and
write-offs on doubtful loans, loan impairment allowance coverage
increases to about 95%. Mainly as a result of low coverage, net
impaired loans account for a high 110% of Fitch Core Capital
(FCC), which in Fitch's opinion makes the bank vulnerable to a
potential fall in the value of collateral. However, Fitch expects
that the bank will be able to manage possible increases in
allowance coverage. The bank's VR is sensitive to a further
prolonged deterioration in asset quality and a sharp fall in real
estate values in Italy, while upward pressure on the VR would
require clear signs of material asset quality improvements, which
is unlikely in the near term.

The bank's regulatory core Tier 1 ratio increased to 10.4% at
end-September 2012 as the approval of internal models for
regulatory purposes resulted in a sharp reduction in risk-
weighted assets (RWA). This supports Fitch's assessment of an
adequate capitalization given the bank's weak asset quality, as
maintaining sound capital ratios will be important to the bank.
Conversion of some EUR1bn of outstanding convertible bonds could
improve the bank's capitalization. Funding and liquidity improved
in 2012 as the bank concentrated on customer funding. Fitch views
capitalization and liquidity favorably at present but any signs
of material weaknesses in these areas would put pressure on the

Banco Popolare's subsidiaries' ratings, Credito Bergamasco, Banca
Aletti and Banca Italease, are based on Fitch's view that Banco
Popolare would provide support if needed. Fitch considers Credito
Bergamasco and Banca Aletti as core subsidiaries given their role
in the group. Fitch believes that Banco Popolare would also
provide support to Banca Italease as failure to do so would pose
a significant reputation risk to Banco Popolare. As the ratings
of the subsidiaries are based on their parent's Long-term IDR,
the ratings are sensitive to changes in Banco Popolare's Long-
term IDR.


The affirmation of Intesa Sanpaolo's ratings reflects its sound
capitalization, solid funding in the current market context,
adequate operating profitability and its leading domestic
franchise. The affirmation also reflects the bank's weakened
asset quality and the weak outlook for the Italian economy. As
Intesa Sanpaolo's Long-term IDR is based on its VR, a downgrade
of its VR would result in a downgrade of its Long-term IDR. Given
the Negative Outlook on the Italian sovereign rating and more
importantly the adverse operating environment in Italy, an
upgrade of Intesa Sanpaolo's IDRs and VR is currently unlikely.

Intesa Sanpaolo's operating profitability has suffered in the
current economic downturn, but profitability has remained more
resilient than that of many of its domestic peers. In 9M12 the
bank generated an operating ROAE of 7% despite high loan
impairment charges, and Fitch expects it to generate adequate
operating income, which should be underpinned by further cost

The bank's FCC/RWA ratio of 9.9% at end-September 2012 was sound.
Intesa Sanpaolo estimated a fully-loaded Basel III common equity
tier 1 ratio of 10.5% at the same date, which compares well with
international peers' estimated ratios. The bank is committed to
maintaining a Basel III common equity Tier 1 ratio of 10% over
the medium term, which Fitch considers sound. Failure to maintain
sound capital ratios would put pressure on ratings.

Fitch considers Intesa Sanpaolo's funding and liquidity solid in
the current market context. Customer deposits and retail bonds
accounted for 62% of funding at end-September 2012. The group has
demonstrated a strong capacity to issue securities in the
wholesale market even under difficult conditions. Intesa Sanpaolo
has managed its liquidity well despite the outflow of short-term
unsecured wholesale funding in H211. At end-September 2012 the
bank estimated an NSFR and LCR above 100%.

Intesa Sanpaolo's Long-term IDR is at the same level as the
sovereign rating, which is on a Negative Outlook. A downgrade of
the sovereign rating would likely result in a downgrade of Intesa
Sanpaolo's VR and Long-term IDR to reflect Fitch's view that the
bank's risk is closely interconnected with Italy's risk.

Intesa Sanpaolo's subsidiaries' ratings, Banca IMI and Cassa di
Risparmio di Firenze, reflect Fitch's view of the core function
of these subsidiaries in the group. As their ratings are based on
their parent's Long-term IDR, they are sensitive to changes in
Intesa Sanpaolo's Long-term IDR.


The affirmation of UBI Banca's ratings reflects the bank's sound
capitalization and funding, its deteriorated asset quality, which
however remains better than peers', its diversified client base
and solid franchise in some of Italy's wealthiest regions and
pressure on operating profitability. As UBI Banca's Long-term IDR
is based on its VR, a downgrade of its VR would result in a
downgrade of its Long-term IDR.

UBI Banca's FCC/RWA ratio improved to 9.5% at end-September 2012
as RWA declined sharply following the approval of internal models
for regulatory capital purposes in 2012. Fitch considers the
bank's capitalization sound, also because capitalization is
underpinned by a EUR640 million convertible bond. Conversion
would improve UBI Banca's core Tier 1 ratio by about a further

Asset quality at the bank has deteriorated materially, but its
gross impaired loan ratio remains better than that of its main
peers. Gross impaired loans reached 8.6% of gross loans at end-
September 2012, but Fitch expects the bank's asset quality to
remain manageable and better than many peers'. This reflects the
bank's operations in wealthy northern Italy and its adequate
lending policies. A material further reduction in asset quality
that could lead to losses would put pressure on ratings, whereas
clear signs of improving asset quality would be needed to put
upward pressure on ratings.

UBI Banca's operating profitability is moderate, reflected by the
bank's operating ROAE of 4.5% in 9M12. Profitability is
negatively affected by low net interest income as a result of low
interest rates and increased funding costs. UBI Banca's
efficiency is weaker than peers', burdened by high personnel
costs. The bank's efforts to realise cost savings from
reorganizing its group structure should bring some relief, but
the group will continue to operate through several subsidiary
banks, which will make cost reduction more difficult. Fitch
assumes that the bank's operating profitability will stabilize,
and any signs of a material deterioration, considered unlikely,
would put pressure on ratings.

Fitch considers UBI Banca's funding sound in the current market
context. Customer funding accounted for a high 70% of total
funding at end-September 2012, when the bank's loans/customer
funding ratio stood at about 120%. Wholesale funding constitutes
only a relatively small portion of overall funding, and the bank
issued a senior unsecured bond in the wholesale market in Q412.
At end-September 2012, the bank estimated its LCR and NSFR above
100%. Failure to maintain sound liquidity, considered unlikely
given the stability of retail deposits, would put pressure on


The affirmation of UniCredit's VR, which underpins the bank's
IDRs, reflects the bank's broad international franchise,
diversified and resilient funding profile, improved
capitalization following a EUR7.5bn capital increase in Q112 and
progress made implementing the bank's 2011 strategic plan which
focuses on simplifying the group structure and improving
operating efficiencies, notably in Italy.

However, the bank's VR also takes into account UniCredit's below-
average asset quality, in particular in Italy, reliance on
resilient collateral values for loan loss coverage, poor
profitability in its Italian business and challenges the bank's
pan-European business model faces in light of increasing
regulatory scrutiny of cross-border funding and capital flows.

In addition to sovereign-related considerations detailed above,
the Negative Outlook on UniCredit's IDR reflects the bank's
challenge to improve the performance of its underperforming
Italian businesses in the current adverse macroeconomic climate.

Compared to its more domestic Italian peers, UniCredit's risk
profile and ratings benefit from its considerable international
risk and earnings diversification. Given the poor performance of
its Italian operations, UniCredit's performance in 2013 will
again largely depend on the profitability of its international
activities, notably in Germany (UniCredit Bank AG which
consolidated much of UniCredit's corporate and investment
banking, CIB; 'A+'/Stable/'a-'), Austria and CEE (UniCredit Bank
Austria which consolidates UniCredit's CEE activities except
Poland; 'A'/Stable/'bbb+') and Poland (Bank Pekao SA; 'A-

While Fitch notes that internationally deployed funding and
capital is not fully fungible due to increasing regulatory
tendencies by local regulators to "ring-fence" the subsidiaries
in their respective jurisdictions, UniCredit's risk profile
nonetheless benefits from various well-performing foreign
subsidiaries with significant dividend payments and sound
internal capital generation.

The bank's IDRs and VR are sensitive to a change in Fitch's
assumptions around the development of UniCredit's asset quality
and profitability, notably in Italy. Currently, Fitch expects new
impaired loans formation to slow down towards the end of 2013 and
collateral values, notably Italian real estate, to remain broadly
resilient in 2013.

UniCredit's VR and IDRs could be downgraded if Italy's recession
is more prolonged than currently anticipated, translating into
higher impaired loans and/or falling collateral values or if
UniCredit is unable to adjust its operating cost base in Italy to
the continued difficult operating environment. Given the Negative
Outlook on the Italian sovereign rating and more importantly the
adverse operating environment in Italy, an upgrade of UniCredit's
IDRs and VR is currently unlikely.


The SRFs of all reviewed banks are in the 'BBB' range. This
reflects Fitch's view that there is a high probability that they
would receive support from the Italian authorities if needed.

SRFs assigned to Italian banks are based on Fitch's ranking of
the banks, according to the agency's view of their systemic
importance. SFRs assigned to the larger banks are higher, at
'BBB+', reflecting Fitch's opinion that the Italian government's
propensity to provide support to them is higher. The SRFs of the
two largest banks Intesa Sanpaolo and UniCredit are 'BBB+'. The
SRFs of Banco Popolare and UBI Banca are lower at 'BBB'
reflecting their lower market shares.

The SRFs and Support Ratings are sensitive to changes in the
propensity or in the ability of the government to provide
support. A downgrade of Italy's sovereign rating would put
pressure on the SRFs as it would indicate a reduced ability for
the authorities to provide support. The SRFs and Support Ratings
would also come under pressure if Fitch considered that the
propensity of the authorities to support the country's banks had
changed, which is not currently factored into Fitch's analysis.


Subordinated debt and other hybrid capital issued by the banks
are notched down from their VRs, or from the VR of their parent
if the issuer has no VR, in accordance with Fitch's criteria.
Non-performance and relative loss severity risk profiles vary
considerably across the instruments. Their ratings are primarily
sensitive to changes in the VRs which drive the ratings.

The 'C' Long-term rating of Banca Italease's trust preferred
securities reflects their non-performance and Fitch's expectation
that the securities are unlikely to resume coupon payments in the
near future.

The rating actions are:

Banco Popolare:
Long-term IDR: affirmed at 'BBB'; Outlook Stable
Short-term IDR: affirmed at 'F3'
VR: affirmed at 'bbb'
Support Rating: affirmed at '2'
Support Rating Floor: affirmed at 'BBB'
Senior debt (including programme ratings and guaranteed notes):
affirmed at 'BBB/F3'
Commercial paper: affirmed at 'F3'
Lower tier 2 subordinated debt: affirmed at 'BBB-'
Preferred stock and junior subordinated debt: affirmed at 'BB-'

Banca Italease:
Long-term IDR: affirmed at 'BBB'; Outlook Stable
Short-term IDR: affirmed at 'F3'
Support Rating: affirmed at '2'
Senior debt and programme ratings: affirmed at 'BBB'
Market linked securities: affirmed at 'BBBemr'
Lower tier 2 subordinated debt: affirmed at 'BBB-'
Trust preferred securities: affirmed at 'C'

Banca Aletti:
Long-term IDR: affirmed at 'BBB'; Outlook Stable
Short-term IDR: affirmed at 'F3'
Support Rating: affirmed at '2'

Credito Bergamasco:
Long-term IDR: affirmed at 'BBB'; Outlook Stable
Short-term IDR: affirmed at 'F3'
Support Rating: affirmed at '2'

Intesa Sanpaolo
Long-term IDR: affirmed at 'A-'; Outlook Negative
Short-term IDR: affirmed at 'F2'
VR: affirmed at 'a-'
Support Rating: affirmed at '2'
Support Rating Floor: affirmed at 'BBB+'
Senior debt (including debt issuance programmes and guaranteed
notes): affirmed at 'A-/F2'
Commercial paper/certificate of deposit programmes: affirmed at
Senior market-linked notes: affirmed at 'A-emr'
Subordinated lower Tier II debt: affirmed at 'BBB+'
Subordinated upper Tier II debt: affirmed at 'BBB-'
Tier 1 instruments (XS0545782020, XS0371711663, XS0456541506,
XS0388841669): affirmed at 'BB+'

Cassa di Risparmio di Firenze:
Long-term IDR: affirmed at 'A-'; Outlook Negative
Short-term IDR: affirmed at 'F2'
Support Rating: affirmed at '1'
Senior debt (including programme ratings): affirmed at 'A-'
Upper Tier 2 instruments: affirmed at 'BBB-'

Banca IMI:
Long-term IDR: affirmed at 'A-'; Outlook Negative
Short-term IDR: affirmed at 'F2'
Support Rating: affirmed at '1'
Senior debt (including programme ratings): affirmed at 'A-'

Intesa Sanpaolo Bank Ireland plc
Commercial Paper/Short-term debt affirmed at 'F2'
Senior unsecured debt (guaranteed by Intesa Sanpaolo, including
programme ratings): affirmed at 'A-'

Societe Europeenne de Banque SA:
Commercial Paper and Short-term debt (guaranteed by Intesa
Sanpaolo): affirmed at 'F2'

Intesa Funding LLC
US Commercial Paper Programme: affirmed at 'F2'

UBI Banca:
Long-term IDR: affirmed at 'BBB+'; Outlook Negative
Short-term IDR: affirmed at 'F2'
VR: affirmed at 'bbb+'
Support Rating: affirmed at '2'
Support Rating Floor: affirmed at 'BBB'
Senior debt (including programme ratings): affirmed at 'BBB+'
Commercial Paper Programme/Short-term debt: affirmed at 'F2'
Subordinated Lower Tier 2 debt: affirmed at 'BBB'
Preference stock and hybrid instruments: affirmed at 'BB'

Long Term Issuer Default Rating (IDR): affirmed at 'A-'; Outlook
Short Term IDR: affirmed at 'F2'
Viability Rating: affirmed at 'a-'
Support Rating: affirmed at '2'
Support Rating Floor: affirmed at 'BBB+'
Senior unsecured debt: affirmed at 'A-'
Guaranteed senior unsecured notes: affirmed at 'A-'
Market-linked notes: affirmed at 'A-(emr)'
Lower Tier 2 notes: affirmed at 'BBB+'
Upper Tier 2 notes: affirmed at 'BBB-'
Preferred stock: affirmed at 'BB+'

UniCredit Bank (Ireland) p.l.c. (no issuer ratings assigned):
Senior unsecured notes: affirmed at 'A-'
Guaranteed senior unsecured notes: affirmed at 'A-'

SEAT PAGINE: Suspends Interest Payment; Reviews Business Plan
Danilo Masoni and Natalie Harrison at Reuters report that Seat
Pagine Gialle suspended an interest payment just five months
after a drawn-out debt restructuring.

According to Reuters, Seat Pagine said its 2011-2013 business
plans were under review, as were its 2015 targets, but also said
it had the resources to honor upcoming debt maturities.

Seat Pagine has been struggling to reduce debts and fight
competition from Internet search giants such as Google, Reuters

Seat Pagine's plight has been made worse by a weak Italian
economy and a decline in print advertising sales, Reuters
relates.  The company, as cited by Reuters, said advertising
sales were down 23% in November compared to the same month a year

Seat Pagine, Reuters says, was due to make a EUR42 million
interest payment on a EUR788 million (US$1.06 billion) senior
secured bond on Jan. 31.  This has been suspended, but the
company has a 30-day grace period before non-payment triggers a
default, Reuters notes.

"The new management is taking a view on how the company is doing,
and although it has cash, whether it makes sense to use that to
pay the debt interest," Reuters quotes one source familiar with
the situation as saying.  "There was always the expectation that
a further restructuring would have to be implemented."

Seat Pagine was left with heavy debts after a EUR5.7 billion
leveraged buyout in 2003 by private equity firms CVC, Permira and
Investitori Associati, Reuters recounts.

According to Reuters, the completion of a lengthy debt
restructuring last year cut Seat Pagine's leverage to around 3.7
times earnings before interest, tax, depreciation and
amortization (EBITDA) from 7.0 times.  But that leverage ratio is
expected to rise again as earnings remain under pressure, Reuters

The company is also due to make a decision on whether to make a
EUR6.3 million interest payment on a portion of its EUR686
million loans, Reuters discloses.

A decision on the interest payments will depend on the outcome of
Seat Pagine's business review but will come before the end of the
grace period, Reuters states.  Its board will meet next before
Feb. 6, Reuters says.

                        About SEAT Pagine

SEAT Pagine Gialle SpA (PG IM) -- is an
Italy-based company that operates multimedia platform for
assisting in the development of business contacts between users
and advertisers.  It is active in the sector of multimedia
profiled advertising, offering print-voice-online directories,
products for the Internet and for satellite and ortophotometric
navigation, and communication services such as one-to-one
marketing.  Its products include EuroPages, PgineBianche,
Tuttocitta and EuroCompass, among others.  Its activity is
divided into four divisions: Directories Italia, operating
through, Seat Pagine Gialle; Directories UK, through TDL
Infomedia Ltd. and its subsidiary Thomson Directories Ltd.;
Directory Assistance, through Telegate AG, Telegate Italia Srl,
11881 Nueva Informacion Telefonica SAU, Telegate 118 000 Sarl,
Telegate Media AG and Prontoseat Srl, and Other Activitites
division, through Consodata SpA, Cipi SpA, Europages SA, Wer
liefert was GmbH and Katalog Yayin ve Tanitim Hizmetleri AS.


TELCO UAB: S&P Puts 'B-' Corp. Rating on CreditWatch Positive
Standard & Poor's Ratings Services said that it placed its 'B-'
long-term corporate credit rating on Lithuania-headquartered
mobile telecommunications operator UAB Bite Lietuva (Bite) on
CreditWatch with positive implications, along with its 'B-'
long-term corporate credit rating on Bite's 100% owner Bite
Finance International B.V.

At the same time, S&P assigned a 'B' issue rating to proposed
EUR200 million senior secured floating-rate notes to be issued by
Bite Finance International B.V., one notch higher than the
current corporate credit rating on Bite.

S&P also placed the 'B-' rating on Bite Finance International's
EUR172 million senior secured notes and the 'CCC+' rating on its
outstanding subordinated notes on CreditWatch with positive
implications.  S&P expects to withdraw these two ratings once the
notes have been repaid.

The CreditWatch placement reflects the likelihood that S&P could
raise the rating on Bite if it refinances its existing debt with
the proposed notes.  Such refinancing would improve Bite's debt
maturity profile and liquidity, and could be compatible with a
higher rating, in S&P's view.

S&P assumes that Bite will use the proceeds of the proposed notes
to repay the existing EUR172 million notes due 2014, the
outstanding subordinated floating-rate notes due 2017, the
outstanding revolving credit facility (RCF) maturing in June
2013, and a payment-in-kind note and the related fees and
expenses.  S&P understands the proposed EUR200 million notes due
2018 will be issued on largely the same terms as the existing
senior secured notes maturing in 2014, albeit with a different

S&P expects adjusted debt to EBITDA at 3.9x and funds from
operations (FFO) to debt to 18% at year-end 2013.

The ratings on Bite continue to reflect Standard & Poor's
assessment of its financial risk profile as "highly leveraged,"
its business risk profile as "weak," and its management and
governance as "fair."

S&P expects to resolve the CreditWatch after reviewing the final
documentation on the proposed notes and other instruments.

S&P could upgrade Bite to 'B' if it successfully refinances its
existing debt based on the proposed terms.

S&P could affirm the rating at 'B-' in the event of any
meaningful changes to the amount, terms, or conditions of the
proposed notes and instruments.


BITE FINANCE: Moody's Rates EUR200MM Sr. Secured Notes '(P)B3'
Moody's Investors Service has assigned a (P)B3 rating to the
EUR200 million senior secured floating rate notes due 2018 to be
issued by Bite Finance International B.V.

Bite intends to use the proceeds from the new notes to refinance
all of its currently outstanding debt (namely EUR172 million of
senior secured fixed rate notes due March 2014, EUR6 million of
senior subordinated notes due March 2017 and EUR5 million under
its credit facilities). The company also plans to use EUR13
million as a shareholder distribution.

Bite has concurrently entered into a EUR20 million senior
revolving credit facility ("RCF") due July 2017, and a EUR10
million bilateral facility with Unicredit.

Ratings Rationale

The (P)B3 rating on the notes reflects the fact that these will
now represent the bulk of Bite's financing structure and that the
amount of senior facilities ahead of it remains limited. In
addition, the notes will benefit from upstream guarantees from
the various operating companies.

The refinancing is overall a credit positive, in that it will
materially improve Bite's debt maturity profile. However, the new
notes will have a significantly higher margin than the 3.5%
margin on the existing senior secured notes. Free cash flow will
thus be materially negatively impacted -- although still expected
to be positive -- and the company's ongoing overall liquidity
profile will also have substantially less tolerance to
performance shortfalls.

The partial use of proceeds for the shareholder distribution is
also a credit negative from a financial policy perspective, given
that the company remains highly leveraged for its business

Given the above, the ratings remain somewhat forward-looking with
respect to financial metrics. In that context, the current
ratings and outlook remain highly premised on Bite successfully
implementing its strategy in both Lithuania and Latvia, with
EBITDA trends continuing to show positive momentum and the
potential for deleveraging.

The principal methodology used in this rating was the Global
Telecommunications Industry published in December 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.

Bite Finance International B.V. is the Dutch holding company of
the Lithuanian company Bite Lietuva UAB. Bite is a mobile
telecommunications operator in Lithuania and Latvia, which
reported 2011 revenue of about EUR174 million. In February 2007 a
private equity consortium led by Mid Europa Partners acquired
Bite through a leveraged buyout for a total consideration of
EUR443 million.

SNS REAAL: S&P Lowers Rating on Non-Deferrable Debt to 'B-'
Standard & Poor's Ratings Services said that it placed on
CreditWatch negative its 'BBB-/A-3' long- and short-term
counterparty credit ratings on Netherlands-based bancassurance
group SNS REAAL N.V. (SNS REAAL, or the group) and the 'BBB/A-3'
long- and short-term counterparty credit ratings on the group's
banking subsidiary, SNS Bank N.V.

At the same time, S&P lowered its ratings on the non-deferrable
debt of SNS Bank and SNS REAAL to, respectively, 'B' and 'B-'
from 'BB+' and 'BB'.  The ratings on the instruments remain on
CreditWatch negative, where they were placed on Nov. 16, 2012.
S&P also lowered its junior subordinated debt ratings of SNS Bank
and SNS REAAL to 'CCC' from 'BB' and 'BB-', respectively.  The
ratings on these instruments also remain on CreditWatch negative,
where they were initially placed on July 20, 2012.

The rating action does not affect S&P's ratings on the group's
insurance subsidiaries, SRLEV N.V. and REAAL Schadeverzekeringen
N.V., which remain on CreditWatch developing due to the
uncertainty of their position within the group under the group's
strategic review.

"The CreditWatch placement of SNS REAAL and SNS Bank is based on
our view of possible negative implications for the group's
overall franchise and the bank's stand-alone credit profile
(SACP) as a result of the protracted strategic discussions
currently taking place.  Through these discussions, we understand
that the group aims to put in place measures to enhance its
capital base and reduce property finance-related risks.  We also
believe that the risks of some form of government intervention
and of imposed remedies--possibly affecting the group's overall
franchise--could rise.  For example, a sale of some or all of the
insurance operations would lead us to remove any related group
support from our ratings on SNS REAAL and SNS Bank," S&P said.

"We continue to believe that support from the authorities to the
group or the bank would be forthcoming if needed, based on the
bank's material retail deposit share (about 10%) and its
assessment as a systemically important institution by the Dutch
authorities.  However, we lowered our ratings on SNS REAAL and
SNS Bank's non-deferrable and junior subordinated debt
instruments to reflect our view of a greater risk of losses on
these instruments -- whether in the form of coupon omission or
writedown -- being forced by the authorities if additional
government support was required.  Our view takes into
consideration the Dutch Intervention Act implemented in June
2012, which gives the authorities wide-ranging powers to
intervene with financial institutions that face material
difficulties.  Our action also incorporates the possibility of
subordinated liability exercises initiated by the group, which we
could consider as a distressed exchange offer under our
criteria," S&P added.

On Nov. 16, 2012, S&P lowered the ratings on SNS REAAL and SNS
Bank, and assigned a negative outlook.  S&P's action reflected
its view of moderately higher economic risks in The Netherlands
and of some erosion in the bank's franchise.  S&P also noted that
the strategic review could lead to the sale of parts of or all of
the group's insurance operations, which S&P views as having a
strong credit profile compared with the bank.  Since the last
rating action, S&P believes that there is mounting pressure on
the group to announce a solution, even if the likely outcome is
still unclear.  S&P considers that a range of options are still
possible, some based on private sector involvement, although the
ultimate approval of any solution by the national and European
authorities will be required.  In S&P's view, any structure
designed to insulate the bank from property-related risks would
likely result in a material immediate crystallization of losses,
in turn leading to some need for additional capital.

S&P's ratings on SNS REAAL are based on S&P's view of the
combined strength of its banking and insurance operations.  They
are underpinned, to some extent, by S&P's view of the stronger
profile of the insurance operations compared to the bank.  The
group's life and non-life operations, SRLEV N.V. and REAAL
Schadeverzekeringen N.V., currently have a SACP of 'a', compared
with the bank's SACP of 'bb+'.  S&P believes that the current
uncertainty around the likely outcome of the strategic review is
exerting negative pressure on the bank's SACP.

The issuer credit rating on SNS Bank includes two notches of
group support above its SACP based on the relatively stronger
profile of its sister insurance operations.  The disposal of some
insurance assets--if material--would lead S&P to stop factoring
any uplift related to these activities in the ratings on the bank
and the group.  Nevertheless, S&P considers that the bank has
"moderate" systemic importance in The Netherlands, a country that
S&P considers to be "supportive" of its banking system, as S&P's
criteria define these terms.  As a result, the rating on the bank
-- if S&P were to exclude any group support -- could still
benefit from a one-notch uplift above its SACP under S&P's
government support approach.

S&P rates SNS REAAL one notch below the operating entities, in
line with S&P's criteria for rating nonoperating holding

S&P expects to resolve the CreditWatch placements on SNS REAAL
and SNS Bank in the next few weeks, possibly by around mid-
February, when the group is due to announce its 2012 results.
S&P believes the group is aiming to announce the outcome of the
strategic review by that date.

To resolve the CreditWatch on the long-term ratings, S&P will

   -- To what extent the solution will insulate the property-
      related risks from the bank;

   -- The strength of the group and the bank's capitalization,
      after any possible capital enhancement measures and
      property finance-related haircuts; and

   -- The scope of any imposed remedies, including possible asset

Resolution of the CreditWatch on the non-deferrable and junior
subordinated debt ratings will depend on whether S&P believes
that additional support from the authorities to the group or the
bank will be required, as S&P believes that this could lead to
some form of burden sharing being imposed on these instruments.
It will also depend on whether the group will initiate liability
management exercises on these instruments, which S&P could
consider as distressed exchange offers under its criteria.


ALLIANCE OIL: Fitch Affirms 'B' Long-Term Issuer Default Rating
Fitch Ratings has affirmed Alliance Oil Company Ltd.'s Long-Term
foreign currency Issuer Default Rating (IDR) at 'B'. The Outlook
is Stable.

AOIL's ratings continue to reflect the company's limited scale of
operations, restricted market share, concentrated business model
and potential increase in capital intensity and leverage to
pursue its organic growth strategy. Fitch notes that the
company's organic growth strategy may be challenged by the recent
production decline at the Kolvinskoye field in Timan-Pechora. At
the same time, Fitch recognizes the company's progress in
upgrading the Khabarovsk refinery. AOIL is one of Russia's
second-tier integrated oil companies, with main upstream assets
in the Timan-Pechora and Volga-Urals regions.


Upstream Scale Limits Upgrade
AOIL's average daily upstream production in 2012 was 53.9
thousand barrels of oil per day (mbbl/d), up 10% yoy. Fitch
expects that in 2013 the company may see a moderate decline in
crude production. The current production level is commensurate
with the mid 'B' rating category. A positive rating action would
be possible if the company expands its hydrocarbons production to
80-100 thousand barrels of oil equivalent per day (mboe/d)
excluding equity stakes while maintaining credit ratios
commensurate with the 'B' rating category. The company intends to
launch the gas business in the Tomsk region in 2013, and targets
double digit growth of oil and gas production in 2013-2015.

Timan-Pechora is Key

AOIL's ability to implement its upstream growth strategy at the
Timan-Pechora region will be particularly important for
maintaining and increasing its production. In 2012 AOIL's average
daily oil production in Timan-Pechora amounted to 23mbbl/d (or
42% of overall production), and at end-2011 the region was
accountable for 63% of the company's proved and probable
reserves. Lower than expected production potential of
Kolvinskoye, AOIL's largest field launched in September 2011,
resulted in upstream production declining to 52.3mbbl/d in Q412
from 62.4mbbl/d in Q411.

Stronger Downstream

Current progress on the Khabarovsk refinery upgrade, increasing
AOIL's primary refining capacity to 90mbbl/d, is supportive of
the current rating. Average daily refining volumes at the
Khabarovsk refinery amounted to 80.1mbbl/d in 2012, up 9% yoy.
The company intends to increase its refining capacity further to
100mbbl/d by end-2013, and to connect the refinery to Transneft's
ESPO pipeline by end-2013, significantly reducing the company's
transportation costs.

Material Contribution to JV

In 2012, AOIL contributed its Volga-Urals production assets
operated by Tatnefteotdacha and Saneco to its joint venture with
Spain's Repsol, S.A. ('BBB-'/Negative) set up in 2011. The assets
accounted for 35% of AOIL's proved reserves at end-2011, and for
around 38% of the company's upstream production in 2012. Fitch
expects AOIL will retain significant control over these assets,
but estimates that operating cash flow effectively available for
servicing AOIL's debt may decrease in the medium term on the back
of the transaction.


Positive: Increasing the scale of upstream and downstream
operations (including hydrocarbon production expanding to 80-
100mboe/d), demonstrating a growing proved reserve base,
achieving positive free cash flow (FCF) on a consistent basis,
and maintaining mid-cycle FFO adjusted leverage at or less than
4x and interest cover above 4x could lead to a positive rating

Negative: Decline in hydrocarbon production (eg stemming from
inability to stabilize the production at Timan-Pechora), as well
as higher capex or non-zero dividends resulting in mid-cycle FFO
adjusted leverage rising above 5x and interest cover falling
below 3x could lead to a negative rating action.


Adequate Liquidity: Fitch views AOIL's liquidity position as
adequate for the current ratings but challenged overall. Organic
sources of liquidity are the most constrained due to high capex
resulting in negative FCF generation. At end-2012, AOIL had
USD436m of cash compared with short-term debt of USD325m.

External Sources of Liquidity: In 2008-2012 AOIL was able to
issue long-term ruble domestic bonds, issue Eurobonds, obtain
long-term financing from Vnesheconombank ('BBB'/Stable) and issue
preferred stock. Fitch believes the company would have the
ability to raise additional finance when needed, if its financial
position does not deteriorate significantly.


Alliance Oil Company Ltd.

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

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

  Short-Term foreign currency IDR: affirmed at 'B'Short-Term
  local currency IDR: affirmed at 'B'Foreign currency senior
  unsecured rating: affirmed at 'B'/'RR4'

  National Long-Term Rating: affirmed at 'BBB(rus)'; Outlook

OJSC Alliance Oil Company

  Local currency senior unsecured rating: affirmed at 'B' /RR4

  National senior unsecured rating: affirmed at 'BBB(rus)'


REYAL URBIS: Debts Talks with Creditors Ongoing
Property Investor Europe reports that debt-laden Reyal Urbis is
considering hiving off some of its real estate debts and assets
to a specially-created subsidiary in order to sell them and pay
off its debts to creditor banks.

The firm has more than EUR4 billion in debts and warned in
October last year that it may file for bankruptcy if it were
unable to reach an agreement with creditors, PIE discloses.
According to PIE, talks are ongoing, and Reyal Urbis acknowledged
that the banks would be able to keep the assets if they wished,
in exchange for reducing or canceling debt owed.

"Financial creditors would have the option of accepting the full
settlement of their claims through payment in kind of the assets
transferred to the subsidiary," PIE quotes the firm as saying in
a statement to Spain's CNMV Securities Market Commission.

Reyal Urbis hopes to keep some assets so it can continue trading,
saying that a stock market de-listing has not been envisaged, PIE

PIE relates Reyal Urbis gave no details of when it might start
the new unit, but added: "In any event, the terms and conditions
of this proposal are in negotiations, and for the moment Reyal
Urbis has not yet reached an agreement with its creditor banks
about it."

Reyal Urbis' consolidated debt stood at EUR4.3 billion on
June 30, while its assets were EUR4.2 billion, PIE discloses.
The debt is outstanding with 40 banks, and it has one month left
to agree with creditors including Santander, Bankia and BBVA, PIE
discloses.  According to PIE, local media reported that Santander
is the biggest creditor at EUR450 million, closely followed by
Bankia with about EUR400 million.  If the company declares
bankruptcy, it would be the second largest in Spain, PIE notes.
It is also having problems meeting short-term debt payments PIE

Reyal Urbis is a Spanish listed real estate developer.

* SPAIN: Property Firms Seek for More Generous Debt Relief
Carlos Ruano, Tracy Rucinski and Tom Bill at Reuters report that
the few listed Spanish property firms to survive a brutal real
estate crash are stepping up the fight with banks for more
generous debt relief to outlast a crisis that could yet have
years to run.

According to Reuters, companies must persuade banks that have
already been forced by the government to write down property
loans to cut their debt to reflect the plummeting value of the
assets linked to it or simply to give them more time.

But property prices have dropped by some 30% since a building
boom collapsed in 2008, crippling Spanish banks that were heavily
exposed to the sector, Reuters notes.

Dozens of property companies have folded, saddling the banks with
empty lots and unfinished buildings that are impossible to sell
in the moribund sector, Reuters discloses.

Reuters notes that with the market not expected to hit bottom for
two more years, the country in deep recession and unemployment at
26 percent, time is running out for firms that refinanced debt
right after the crash and whose borrowings are now coming due.

"Talks are accelerating to try to resolve the property problem,"
Reuters quotes a source from a large property firm as saying on
condition of anonymity.

The building bust in Spain left banks with EUR184 billion (US$244
billion) of bad real estate debt and half-built developments
around the country, Reuters discloses.

Seven banks were eventually taken over by the government and
Europe has put EUR40 billion of emergency money into Spain's
financial system, Reuters recounts.

Banks have since tried to purge their exposure by writing down
billions of euros worth of toxic assets to comply with new
government rules, possibly opening the door to new agreements on
debt owed by property companies, Reuters notes.

But at the same time they are struggling with rising non-
performing loans, Reuters states.

"Previously banks wanted to avoid writedowns at any cost, but
following the (government) decrees that oblige provisioning it
now makes sense to remove from the balance sheet loans that are
eating up capital," Reuters quotes a banking source as saying.

"Especially when the sector outlook is negative.  Banks have
already renegotiated and refinanced loans on the assumption that
the sector would recover.  That isn't happening," the source, as
cited by Reuters, said on condition of anonymity.

U N I T E D   K I N G D O M

2E2 UK: Business in Administration After Failing to Secure Funds
Doug Woodburn at reports that certain of 2e2's
UK subsidiaries have been placed into administration after the
integrator failed to secure additional funding for the business.

Simon Granger -- --, Chad Griffin
-- -- and Simon Kirkhope -- -- of FTI Consulting appointed as
joint administrators of 10 2e2 companies in the UK, including 2e2
Holdings Limited.

Buyers are being sought for its international businesses,
including those in Ireland, Spain and the Netherlands, which
continue to operate as normal, FTI said in a statement, according

The 2e2 companies in administration are:

   -- 2e2 Holdings Limited
   -- 2e2 Investments Limited
   -- 2e2 Group Limited
   -- 2e2 Managed Operations Limited
   -- 2e2 Property Limited
   -- 2e2 Limited
   -- 2e2 UK Limited
   -- Morse Overseas Holdings Limited
   -- Morse Group Limited
   -- Diagonal Quest Limited

Founded in 2002, private equity-backed 2e2 swiftly built itself
into a near-400m-turnover reseller/integrator via a string of
acquisitions including HP and Oracle partner Compel and, more
recently, Morse. It employs about 2,000 staff.

ALBURN REAL: S&P Lowers Rating on Class A Notes to 'CCC-'
Standard & Poor's Rating Services lowered to 'CCC- (sf)' from 'B
(sf)' its credit ratings on the class A notes in Alburn Real
Estate Capital Ltd.  At the same time, S&P affirmed its  'CCC-
(sf)' credit ratings on the class B to E notes.

The rating actions follow S&P's review of the loan backing the
transaction.  The loan has been in breach of the loan-to-value
(LTV) ratio covenant since April 2011.  In May 2011, the loan was
declared to be in default as the borrower did not cure the LTV
ratio covenant breach.

Since May 2011, the issuer has received revised valuation reports
from CBRE.  The latest valuation that CBRE carried out was in
April 2012.  At that time, CRBE valued the property portfolio at
GBP115 million, resulting in a senior LTV ratio of 155.1% and a
whole loan LTV ratio of 165.3%, against covenants of 115% and
125%, respectively.

Since CBRE undertook the valuation, 32 properties have been sold.
The issuer has used some of the proceeds from the property sales
to partially pay down the class A notes.  It used GBP68.2 million
of property proceeds to pay down the class A notes on the
January 2013 interest payment date.  Following the property
sales, the senior LTV ratio is now 450.2% and the whole loan LTV
ratio is 497.2%.

Of the remaining 13 properties, five properties are being sold
subject to the freeholders' consent, and the other eight are
being marketed for sale by Savills.  S&P believes that if these
properties are sold, the principal proceeds will be insufficient
to repay in full any of the remaining classes of notes.

If the remaining properties are sold before the loan's maturity
in October 2013, swap break costs will apply to the transaction.
These costs will rank senior to the noteholders.

S&P has lowered its ratings on the class A notes to reflect its
view that the proceeds of the sales will be insufficient to repay
these notes in full.  S&P has affirmed its 'CCC- (sf)' ratings on
the class B to E notes because these ratings already reflect its
view that the notes will suffer principal losses in the near

Alburn Real Estate Capital is a single secured loan CMBS
transaction, backed by one loan secured on commercial properties
located across the U.K.


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:



Class        Rating
       To           From

Alburn Real Estate Capital Ltd.
GBP188.05 Million Commercial Mortgage-Backed Floating-Rate Notes

Ratings Lowered

A     CCC- (sf)    B (sf)

Ratings Affirmed

B     CCC- (sf)
C     CCC- (sf)
D     CCC- (sf)
E     CCC- (sf)

CORNERSTONE TITAN: S&P Cuts Rating on Class F Notes to 'CCC'
Standard & Poor's Ratings Services lowered its credit ratings on
Cornerstone Titan 2005-2 PLC's class E, F, and G notes.

The rating actions follow S&P's credit review of the two
remaining loans backing the transaction under its November 2012
European commercial mortgage-backed securities (CMBS) criteria.


The West Midlands Office loan is the largest of the remaining
loans and is currently secured by one secondary office block,
located in Solihull, on the outskirts of Birmingham.  The
property is let to a single tenant and the lease is due to expire
in 2019.  The current securitized loan balance is GBP27,067,375.

The loan was transferred to special servicing on Oct. 19, 2012
because the borrower did not repay the loan at maturity.  The
special servicer instructed an updated valuation, which resulted
in a new reported value of GBP16 million.  Therefore the updated
securitized loan-to-value (LTV) ratio has increased to 169%.

In S&P's opinion, the likelihood of principal losses has
significantly increased in light of the upcoming legal final
maturity and the decreased asset value.

             BRADFORD RETAIL LOAN (22.85% OF THE POOL)

The Bradford Retail loan is secured by a retail block close to
the main shopping area in the center of Bradford, West Yorkshire.
At closing, the property was fully occupied, but the occupancy
has decreased to 85%--mainly because tenants have gone into
administration.  The loan was due to mature on July 18, 2010.
Following a payment default in September 2009, the loan was
transferred to special servicing.

The special servicer has taken an active role in managing the
property and reducing the building's vacant space through short-
and long-term lets.  The overall strategy is aimed at maximizing
value, with a view to dispose of the asset.

The property was last valued in November 2009 at GBP3,100,000.
In view of the upcoming legal final maturity and reported asset
value, S&P anticipates principal losses on this loan.

The rating actions reflect S&P's view that the creditworthiness
of the remaining loans in the loan pool has deteriorated and will
likely result in principal losses for the class F and G notes,
and reduce the amount of credit enhancement available to the
class E notes.  S&P has therefore lowered its ratings on these
classes of notes.

Cornerstone Titan 2005-2 closed in December 2005 with a total
issuance of GBP398.781 million.  The legal final maturity is in
October 2014.  Of the seven loans that originally backed the
transaction, five have fully repaid.  The current note balance
has decreased to GBP35,172,375.


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:



Class                 Rating
             To                    From

Cornerstone Titan 2005-2 PLC
GBP398.781 Million Commercial Mortgage-Backed Floating-Rate Notes

Ratings Lowered

E            BB- (sf)              A- (sf)
F            CCC (sf)              B (sf)
G            CCC- (sf)             B- (sf)

GEMINI ECLIPSE: S&P Lowers Ratings on Two Note Classes to 'CCC-'
Standard & Poor's Ratings Services lowered to 'CCC- (sf)' its
credit ratings on GEMINI (ECLIPSE 2006-3) PLC's class A and B
notes.  At the same time, S&P has affirmed its 'D (sf)' ratings
on the class C, D, and E notes.

GEMINI (ECLIPSE 2006-3) is a single-borrower secured-loan
transaction that securitizes a portfolio of retail, office,
warehouse and industrial, and leisure properties in England,
Scotland, and Wales.  S&P analysis reflects its November 2012
European commercial mortgage-backed securities (CMBS) criteria.

The rating actions follow S&P's review of the underlying loan
under its November 2012 European commercial mortgage-backed
securities (CMBS) criteria.

In August 2012, the special servicer accelerated the defaulted
underlying loan.  Under the agreement, the interest rate swaps
terminate following loan enforcement and the swap break costs
crystallized.  Although the loan is being enforced, the swap
counterparty has agreed not to terminate the hedging arrangement
subject to an agreed pay-down of the hedge over an agreed period.

On Oct. 17, 2012, the reported swap's mark-to-market (MTM)
exposure was GBP264.9 million: GBP250.9 million for the senior
hedging arrangement and GBP14.0 million for the junior hedging
arrangement.  This compares with a reported value of
GBP414,025,000 (as of Sept. 30, 2012).  The latest reported MTM
loan-to-value (LTV) ratio is 238%.

To date, the issuer has drawn GBP27.8 million on the liquidity
facility and further draws are anticipated.  All liquidity
facility drawings will be repaid senior to principal payments due
on all classes of notes.

In S&P's opinion, recovery of full principal appears increasingly
unlikely in light of the above factors, and S&P considers that
there is at least a one-in-two likelihood of principal losses on
all classes of notes.  S&P has therefore lowered to 'CCC- (sf)'
its ratings on the class A and B notes from 'B (sf)' and 'B-
(sf)', respectively.  At the same time, S&P has affirmed its 'D
(sf)' ratings on the class C, D and E notes to reflect its view
that they will likely suffer principal losses.


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:



Class                 Rating
            To                    From

Gemini (Eclipse 2006-3) PLC

GBP918.862 Million Commercial Mortgage-Backed Floating Rate Notes

Ratings Lowered

A           CCC- (sf)             B (sf)
B           CCC- (sf)             B- (sf)

Ratings Affirmed

C           D (sf)
D           D (sf)
E           D (sf)

LEMMA EUROPE: Gibraltar Court Issues Wind-Up Order
The Insurance Insider reports that the liquidation of Lemma
Europe Insurance Company Ltd appears to have been granted by the
Supreme Court of Gibraltar after it appointed Grant Thornton as

A notice on the defunct Gibraltar-based insurer's website said
Frederick White of Grant Thornton has been appointed as
liquidator following a winding-up order issued by the court on
Jan. 24, 2013, the report relates.

As reported in Troubled Company Reporter-Europe on Oct. 4, 2012,
the Gibraltar Chronicle said the Gibraltar Financial Services
Commission which made the uncontested application for winding up
revealed in court that it has sent Sergei Chernyshov, Lemma
Europe's owner sole director, a preliminary note to the effect
that it is considering declaring him unfit and not proper person
to own or direct companies. This said lawyer Peter Caruana QC was
being done on the grounds of "honesty and integrity".  That is
understood to mainly relate to the alleged failure of parent
company Lemma Ukraine, also owned by Mr. Chernyshov, to honour
reinsurance payments to Lemma Europe.

Lemma Europe Insurance Company Ltd is a Gibraltar-based insurer.

MANCHESTER AIRPORT: In Administration After Sharp Fall in Orders
H&V News reports that Manchester Airport M&E firm Brown & Co
(Electrical Engineers) has gone into administration after a sharp
fall in orders.

It has resulted in 15 immediate redundancies, according to H&V

The report relates that the firm had secured a mechanical and
electrical services contract for Manchester Airport's new Air
Traffic Control Tower.  The main contractor is Morgan Sindall

Chris White and John Russell, partners at the P&A Partnership,
were appointed as joint administrators over electrical
contractors in Bury on Jan. 22, 2013.

The report discloses that administrators from P&A Partnerships
confirmed they are currently reviewing the company's work in
progress, including an ongoing contract in respect of Manchester

The company employed 28 people, but 15 were unfortunately made
redundant with immediate effect.

"The company's projected order book into the New Year was
drastically reduced and the lack of future work has resulted in
the company entering into administration," the report quoted Mr.
White as saying.  Mr. White added that it was too early to say
what might happen to the business, the report relates.

PHOENIX GROUP: Plans to Raise GBP250-Mil. From Share Placement
Sam Jones at The Financial Times reports that Phoenix Group plans
to raise GBP250 million in a share placing to help reduce its
debt burden as part of a major capital restructuring.

According to the FT, the company in a statement on Wednesday
morning announced a GBP170 million open offer at 500p per share
-- a 15% discount to Tuesday's closing price -- and GBP80 million
share placement with hedge fund Och-Ziff.

The proceeds will go towards paying off a GBP450 million loan
from Impala bank, and will pave the way for a restructuring of
the group's remaining GBP1.857 billion of debt, the FT discloses.

The move will also end restrictions placed by the company's
lenders on the dividend it pays to shareholders, the FT states.

Phoenix chief executive Clive Bannister said the company's
restructuring will see it extend the average maturity of its debt
from 36 months to 78 months, the FT relates.

Phoenix floated two years ago with debts of GBP3.5 billion -- a
legacy of the company's costly acquisition of Resolution Life
brokered by entrepreneur Hugh Osmond, the FT recounts.
Mr. Osmond and his financial backers were forced to give up their
majority holdings in Phoenix, then known as Pearl, as part of an
earlier restructuring of the company, the FT notes.

"We were never worried about the quantum of our debt, it was the
maturity of it that was a concern," the FT quotes Mr. Bannister
as saying.

Phoenix Group is a closed-life assurance fund business.

RENEWABLE ENERGY: S&P Affirms 'B+' Corporate Credit Rating
Standard & Poor's Ratings Services said that it affirmed its 'B+'
corporate credit rating on U.K.-based landfill gas (LFG)-to-
electricity generator, Infinis PLC.  The outlook is stable.  At
the same time, S&P assigned its 'B+' issue rating to Infinis'
proposed GBP350 million bond.  The recovery rating on the bond is
'4', indicating S&P's expectation of average (30%-50%) recovery
prospects in the event of a payment default.

The affirmation follows Infinis' announcement that it is
proposing to issue a GBP350 million bond and use the proceeds
partly to refinance its GBP275 million bond maturing in December
2014, and partly to fund the acquisition of about 76 megawatts
(MW) of LFG assets held by Novera Energy Ltd., a subsidiary
within Infinis' consolidated group.  The acquisition will result
in the full integration of the group's LFG portfolio of 336 MW of
LFG assets.  Infinis will also pay a dividend to its immediate
parent company.

In S&P's view, the transaction and transfer of assets do not
significantly change leverage within the consolidated group,
which is the focus of S&P's analysis.  S&P continues to assess
the Infinis group by consolidating cash flow and debt (including
the project finance facilities for wind assets) up to and
including the parent, Infinis Holdings.

S&P continues to assess Infinis' financial risk profile as
"highly leveraged".  S&P's assessment is constrained by the
group's high financial leverage and uncertainties stemming from
the financial policies and strategy of the group's owner, private
equity firm Terra Firma.

Infinis' business risk profile, in S&P's view, remains
constrained by the increasing exposure of part of its revenues to
volatile wholesale power prices.  Moreover, Infinis' LFG assets
are depleting, and there is some uncertainty about the length of
their residual economic life.

In S&P's view, Infinis will continue to deliver sound operating
performance and financial ratios commensurate with the ratings,
including adjusted funds from operations (FFO) to debt of more
than 12% on a long-term basis.

The ratings could come under pressure if either Infinis or
Infinis' consolidated group engages in further material
acquisitions, especially if these are debt-funded, or if S&P sees
evidence of more aggressive shareholder policies in terms of the
capital structure or dividend distributions.  Such occurrences
could also restrain credit measures, causing adjusted FFO to debt
to remain less than 12%, which would no longer be commensurate
with the rating.

Wholesale power prices falling lower than current market
expectations, or renewable obligation certificate prices falling
below the buyout price, could similarly strain credit measures
and the rating.  Potential downside could also arise if S&P
considers that government support for renewable energy has
diminished, or if Infinis has significant issues executing its
wind expansion plan.

In S&P's view, any ratings upside potential is limited at this
stage, mainly due to the group's financial risk profile, which is
constrained by high leverage and uncertainty regarding the
financial policies of the owner, Terra Firma.  S&P could consider
raising the rating if it project a sustainable improvement in
adjusted FFO to debt of more than 15%, together with an absence
of rating constraint stemming from Infinis' ownership by a
private equity firm.

* UK: Business Insolvencies Fall in 2012, Experian Data Shows
The 2012 Business Insolvency Index from Experian, the global
information services company, reveals that during 2012, 0.86%
fewer UK businesses failed than the previous year, with 1.04% of
the business population failing compared to 1.10% in 2011.  The
year ended with December seeing 0.08% of businesses fail. This
compares to 0.11% in the same month during 2011 and represents
the lowest rate seen in December since 2007.

Examining the insolvency figures throughout 2012 highlights an
increasingly stable picture amongst businesses; with the
insolvency rate remaining broadly flat (between 0.25 and 0.27%)
in each quarter throughout the year - which is a slight
improvement on 2011, when the range was between 0.26 and 0.29%.

The greatest improvement in the rate of insolvencies was seen by
firms with 51-100 employees - their insolvency rate fell from
2.22% in 2011 to 1.83% in 2012.  This was followed closely by
firms with 26-50 employees whose insolvency rate fell to 2.21%,
from 2.59% in 2011 and firms with 11-25 employees, where the
insolvency rate dropped from 2.60% in 2011 to 2.35%.

The only significant year-on-year increases in the rate of
insolvencies came from the largest firms; all those with over 500
employees, which saw an increase from 1.46% in 2011 to 1.61% in
2012. In addition, micro firms with 1-2 employees also saw a
slight increase in insolvencies from 0.71% to 0.73%.

Max Firth, Managing Director, Experian Business Information
Services, UK&I said: "Following the slight upturn in 2011, 2012
has seen the business insolvency rate fall and then remain stable
throughout the year. In particular, firms that suffered most
during the downturn were the ones to see the most significant

"The rate of insolvencies is significantly lower now than when it
was at its peak in 2009 at 1.25%, but there is still a way to go
before we reach the pre-recession rate of 2007, which stood at

"This is highlighted by the slight increase in insolvencies
amongst larger businesses - which highlights the need for
businesses to stay alert to changes which may affect them.
Ongoing monitoring of all clients and suppliers regardless of
size is essential, as the impact of larger corporate insolvencies
can be felt down the supply chain."

                           Across the UK

Insolvency figures have shown improvements in a number of areas,
with the biggest improvements coming from the North West, Wales
and the West Midlands.

Scotland had a good year in 2012, with the rate of insolvencies
dropping by more than a third in Q3 of 2012 to 0.18% then again
in Q4 to 0.11% - resulting in an annual figure of 0.86% - the
lowest rate for Scotland since 2010.

Figures for the North East were up in 2012, having experienced a
steady increase in insolvency rates throughout the year.  In
addition, the East Midlands have witnessed a very slight

                            Sector View

Of the UK's five largest industries - business services, IT,
property, construction and the leisure and hotel industry - the
IT sector was the only one that saw signs of a difficult year,
with insolvency rates up to 0.74% in 2012, having held its annual
insolvency rate at 0.65% since 2010.

The property sector made significant improvements, falling from
0.91% in 2011 to 0.75% in 2012.  The hotel and leisure industry
also showed improvements with the data showing a drop from 1.82%
in 2011 to 1.77% in 2012.  Figures for the hotel and leisure
industry dropped dramatically in Q3 and held at 0.39% in Q4,
possibly as a result of the Olympic and Jubilee summer.

There was also positive news for the building and construction
and business services sectors - showing a drop in insolvency
rates compared to 2011 of 0.06% nearly 0.03% respectively.

"Firms need to remain prudent in order to prosper.  By sharing
data with credit reference agencies, businesses can improve their
own credit rating, which should also be regularly monitored to
ensure businesses are in the best position to secure deals and
finance as required," Mr. Firth added.


* Upcoming Meetings, Conferences and Seminars

Feb. 7-9, 2013
      Caribbean Involvency Symposium
         Eden Roc Renaissance, Miami Beach, Fla.
            Contact:   1-703-739-0800;

Feb. 17-19, 2013
      Advanced Consumer Bankruptcy Practice Institute
         Charles Evans Whittaker Courthouse, Kansas City, Mo.
            Contact:   1-703-739-0800;

Feb. 20-22, 2013
         Four Seasons Las Vegas, Las Vegas, Nev.
            Contact:   1-703-739-0800;

Apr. 10-12, 2013
      TMA Spring Conference
         JW Marriott Chicago, Chicago, Ill.

Apr. 18-21, 2013
      Annual Spring Meeting
         Gaylord National Resort & Convention Center,
         National Harbor, Md.
            Contact:   1-703-739-0800;

June 13-16, 2013
      Central States Bankruptcy Workshop
         Grand Traverse Resort, Traverse City, Mich.
            Contact:   1-703-739-0800;

July 11-13, 2013
      Northeast Bankruptcy Conference
         Hyatt Regency Newport, Newport, R.I.
            Contact:   1-703-739-0800;

July 18-21, 2013
      Southeast Bankruptcy Workshop
         The Ritz-Carlton Amelia Island, Amelia Island, Fla.
            Contact:   1-703-739-0800;

Aug. 8-10, 2013
      Mid-Atlantic Bankruptcy Workshop
         Hotel Hershey, Hershey, Pa.
            Contact:   1-703-739-0800;

Aug. 22-24, 2013
      Southwest Bankruptcy Conference
         Hyatt Regency Lake Tahoe, Incline Village, Nev.
            Contact:   1-703-739-0800;

Oct. 3-5, 2013
      TMA Annual Convention
         Marriott Wardman Park, Washington, D.C.

Nov. 1, 2013
      NCBJ/ABI Educational Program
         Atlanta Marriott Marquis, Atlanta, Ga.
            Contact:   1-703-739-0800;

Dec. 2, 2013
      19th Annual Distressed Investing Conference
          The Helmsley Park Lane Hotel, New York, N.Y.
          Contact:   240-629-3300 or

Dec. 5-7, 2013
      Winter Leadership Conference
         Terranea Resort, Rancho Palos Verdes, Calif.
            Contact:   1-703-739-0800;


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

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  Go to 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., Washington, D.C., 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 2013.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

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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,
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