TCREUR_Public/130515.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Wednesday, May 15, 2013, Vol. 14, No. 95

                            Headlines



C R O A T I A

VARTEKS: Creditors Reject Financial Restructuring Plan


D E N M A R K

* DENMARK: Ailing Banks Get More Time to Raise Capital


G E R M A N Y

ACG AIR: Files for Insolvency Process After License Suspension
ALBA GROUP: S&P Affirms Corp. Credit Rating; Outlook Negative
COMMERZBANK AG: Launches Heavily Discounted EUR2.5BB Rights Issue
DECO 17: S&P Affirms 'D' Rating on Two Note Classes
GERMAN RESIDENTIAL: S&P Affirms BB+ Rating on Two Note Classes

QUIRINUS PLC: S&P Lowers Rating on Class F Notes to 'CCC'
SUNWAYS AG: Konstanz Court Opens Insolvency Process
WEPA HYGIENEPRODUKTE: S&P Assigns 'BB-' CCR; Outlook Stable


I R E L A N D

CONNEMARA MINING: High Court Rejects Wind Up Bid
IRISH BANK: Liberty Insurance Seeks 100% Control of Quinn


I T A L Y

BANCA MONTE: May Report Fourth Straight Quarterly Loss


L I T H U A N I A

UKIO BANKAS: Appeals Bankruptcy Order in Lithuania Court


L U X E M B O U R G

MONIER GROUP: Fitch Affirms 'B' Long-Term Issuer Default Rating


N E T H E R L A N D S

CLONDALKIN INDUSTRIES: S&P Puts 'B-' CCR on CreditWatch Positive
CSM NV: Weak Profitability Prompts Moody's to Assign B2 CFR


P O R T U G A L

DOURO MORTGAGES: S&P Affirms 'B' Rating on Class C Notes


S P A I N

GLOBAL HIPOTECARIO I: Moody's Cuts Rating on Cl. C Notes to Caa2
CAIXA PENEDES 2: Moody's Lowers Rating on Class C Notes to 'B3'
FTPYME TDA: Fitch Affirms 'CCC' Rating on Class 3SA Notes
IM GRUPO BANCO: S&P Affirms 'B' Rating on Class D Notes
SANTANDER HIPOTECARIO 1: Moody's Cuts Rating on D Notes to 'Ba2'


T U R K E Y

BANK AUDI: Fitch Affirms 'B' Long-term Issuer Default Rating


U N I T E D   K I N G D O M

FORDGATE COMMERCIAL: S&P Lowers Rating on Class B Notes to 'B+'
INDUS PL:C: S&P Downgrades Rating on Class C Notes to 'B'
MOWAT: Cash-Flow Problems Prompt Administration
NORD ANGLIA: S&P Affirms 'B' Long-Term Corporate Credit Rating
SOUTHERN PACIFIC: S&P Affirms 'B' Rating on Class E Notes


X X X X X X X X

* Money Market Reforms to Open Doors for New Liquidity Products
* Fitch: European Investors Say Worst of Euro Crisis Not Yet Over


                            *********


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C R O A T I A
=============


VARTEKS: Creditors Reject Financial Restructuring Plan
------------------------------------------------------
SeeNews, citing news daily Poslovni Dnevnik, reports that the
creditors of Varteks have rejected the financial restructuring
plan proposed by the company's management at a pre-bankruptcy
hearing on Monday.

According to SeeNews, the daily related that a new plan will be
drafted by the country's finance ministry and the settlement
council has given it five days to do so.

SeeNews notes that the media reported Varteks' total debt amounts
to HRK374.2 million (US$64.3 million/EUR49.2 million).

Varteks, SeeNews says, has been undergoing restructuring for the
past few years.

Headquartered in the eastern town of Varazdin, Varteks is a
textile company.  The company was founded in 1918.



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D E N M A R K
=============


* DENMARK: Ailing Banks Get More Time to Raise Capital
------------------------------------------------------
Frances Schwartzkopff at Bloomberg News reports that Danish banks
in breach of the nation's solvency rules will get more time to
raise capital and avert failure as the regulator eases its
resolution practices.

According to Bloomberg, Anders Balling, head of banking at the
regulator in Copenhagen, said that the Financial Supervisory
Authority will give two banks currently in breach of individual
solvency requirements the time they need to rebuild their capital
buffers.  At the height of Denmark's banking crisis two years
ago, the FSA gave lenders as little as 48 hours to find investors
before they were shut down, Bloomberg recounts.

Denmark's FSA has enforced some of the European Union's toughest
bank rules, leading the bloc in requiring senior creditors to
share losses since 2011, Bloomberg relates.  The financial
industry has criticized the approach, arguing it risked deepening
the nation's economic crisis, Bloomberg notes.  Denmark is the
Scandinavian country hardest hit by the turmoil in the euro zone
as it struggles to emerge from a 2008 property bubble and an
ensuing spate of regional bank failures, Bloomberg discloses.

At least 12 Danish banks have been shut down since 2008 for
breaching solvency rules, while another dozen were absorbed by
stronger rivals, Bloomberg recounts.  After the 2011 failure of
Amagerbanken A/S -- the EU's first bail-in within a resolution
framework -- the FSA stepped up its efforts to catch banks
holding what it described as an "optimistic" view on risky
assets, Bloomberg relates.

According to Bloomberg, the watchdog started conducting surprise
Friday afternoon inspections, giving troubled banks a weekend to
find the capital they needed to escape insolvency.  Failing that,
a lender was declared insolvent and either wound down or taken
over, Bloomberg says.

FSA General Director Ulrik Noedgaard said in November, the FSA
was considering extending the weekend deadline to as long as
three months, pending the outcome of a review, Bloomberg
recounts.  Mr. Balling, as cited by Bloomberg, said that the
agency now finds an open-ended timeline more appropriate.

Now, "there is no time limit as such," Bloomberg quotes
Mr. Balling as saying.  "We can set a limit if, for instance,
there is an increased risk.  But as long as the bank is working
constructively with decreasing risk and increasing capital, we
will give them time."

The regulator in February told Basisbank A/S to submit a capital
recovery plan after it failed to meet a solvency requirement of
10.3% of risk-weighted assets, Bloomberg discloses.  A month
later, it told Vorbasse-Hejnsvig Sparekasse to submit a similar
plan for falling short of its 14.8% individual requirement,
Bloomberg recounts.



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


ACG AIR: Files for Insolvency Process After License Suspension
--------------------------------------------------------------
ch-aviation reports that ACG Air Cargo Germany and its
shareholders have unanimously moved to declare insolvency
following the temporary suspension of its Operating License.

According to the cargo carrier, insolvency proceedings will
provide both management and shareholders with breathing space in
which "to create an opportunity to restructure the company and
restore operational activities."

Using a fleet of four B747-400(F)s, ACG had specialized in global
airfreight operations until the Luftfahrtbundesamt (LBA),
Germany's civil aviation authority, revoked it's operating
licence in early April citing European Community Directive
1008/2008, ch-aviation relates.

According to the LBA, ACG's security oversights had been rendered
inadequate owing to the company's precarious financial state.


ALBA GROUP: S&P Affirms Corp. Credit Rating; Outlook Negative
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its
outlook on Germany-based waste management operator ALBA Group plc
& Co. KG to negative from stable.  At the same time, S&P affirmed
its long-term corporate credit rating on ALBA Group at 'BB-'.

In addition, S&P affirmed its 'B' issue rating on ALBA Group's
EUR203 million unsecured notes due in 2018.  The recovery rating
on the unsecured notes is unchanged at '6', reflecting S&P's
expectation of negligible (0%-10%) recovery in the event of a
payment default.

The outlook revision reflects S&P's view of the continued
deterioration in ALBA Group's business environment, caused by a
significant fall in demand for both ferrous and nonferrous scrap
along with the high volatility in the selling prices of this
scrap.  There has been a steady decline in demand for scrap metal
among ALBA Group's customers, including steel producers, who
themselves are cutting back production significantly.  S&P
continues to view ALBA Group's nontrading business (waste
operations and services) as a relatively stable segment in terms
of revenue that generates the bulk of the group's EBITDA.
However, the waste operations segment is facing margin decline
because of economic uncertainties reducing business volume and
increasing competitive pressures.  The outlook revision also
highlights S&P's concern about the group's tight covenant
headroom over the next few quarters.  S&P still assess ALBA
Group's business risk profile as "fair," but note that the
group's competitive position has deteriorated from the level S&P
previously factored into its ratings.  If the current
deterioration in the group's various segments persists, S&P could
revise downward its business risk profile assessment to "weak."

S&P understands that ALBA Group has initiated a restructuring
program to reduce its cost base in light of lower scrap volume
demand.  However, in S&P's opinion ALBA Group might have been a
bit late in introducing some of these measures compared with some
of its peers.

"In our base-case scenario, we estimate that the group's EBITDA
will decline by about 10% in financial year 2013 (ending Dec.
31), because of lower scrap volume causing the underabsorption of
fixed costs.  Our base-case scenario also assumes increased
competition in the waste operations business at the same time as
the group seeks to increase its exposure among commercial
customers.  We assume management will continue its financial
policy of prioritizing debt reduction over any shareholder
returns, which we view as supporting the rating.  We also expect
the group to focus on improving its cash flow by reducing capital
expenditure (capex) and monetizing its working capital during
financial 2013.  In our base case, we forecast free operating
cash flow (FOCF) generation of about EUR30 million, the bulk of
which will be used to repay the amortizing bank debt," S&P said.

The negative outlook reflects S&P's view that it could lower the
ratings if the difficulties in ALBA Group's market environment
were not to reverse in the second half of financial 2013.
Specifically, S&P could lower the ratings if it believes the
group's reported EBITDA for financial 2013 is likely to decline
beyond 15% in absolute terms or if credit metrics become weaker
than the levels it considers commensurate with the rating--for
example, if FFO to debt falls to less than 12%.

In addition, S&P might lower the rating if the tight headroom
under the covenants persists over time, leading to ongoing risk
of a covenant breach.

A revision of the outlook to stable would require a recovery in
the volume of scrap and the successful execution of the cost-
cutting programs leading to sustainable absolute profitability.
Further support could come from the nontrading segments if they
succeed in winning additional contracts that could help maintain
the group's reported EBITDA at about EUR160 million per year.


COMMERZBANK AG: Launches Heavily Discounted EUR2.5BB Rights Issue
-----------------------------------------------------------------
James Wilson at The Financial Times reports that Commerzbank AG
on Tuesday began a fresh attempt to shore up its capital by
launching its heavily discounted EUR2.5 billion rights issue.

Germany's second-largest bank by assets will use the proceeds to
pay back state support that helped to protect it through the
financial crisis, the FT discloses.  The German government will
also cut its equity stake in Commerzbank from 25% to below 20%,
the FT notes.

According to the FT, Commerzbank set the price for its new shares
at EUR4.50, a discount of around 38% to the theoretical ex-rights
price, and a 55% discount to the value of Commerzbank shares at
the close on May 13, when they were down 4.8% at EUR9.94 on
anticipation of the rights issue.

Beleaguered by the financial crisis, including the impact on its
large holdings of sovereign debt, property and shipping loans,
Commerzbank has launched repeated rights issues over the past
four years, angering shareholders who have seen the value of
their stock plummet since the bank took over Dresdner Bank, its
German rival, in 2008, the FT relates.

The bank, the FT says, is to pay back about EUR1.6 billion of
hybrid debt to the German government -- the remaining chunk of
more than EUR16 billion of the securities Berlin provided to get
Commerzbank through the aftermath of the Dresdner takeover.

Headquartered in Frankfurt am Main, Germany, Commerzbank AG --
http://www.commerzbank.com-- is the parent company of a
financial services group active around the world.  The group's
operating business is organized into six segments providing each
other with mutually beneficial synergies: Private and Business
Customers, Mittelstandsbank, Central and Eastern Europe,
Corporates & Markets, Commercial Real Estate and Public Finance
and Treasury.


DECO 17: S&P Affirms 'D' Rating on Two Note Classes
---------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on DECO 17 - Pan Europe 7 Ltd.'s classes of notes.

Specifically, S&P has:

   -- Raised to 'AA (sf)' from 'A (sf)' our rating on the class
      A1 notes;

   -- Lowered and removed from CreditWatch negative its ratings
      on the class A2, B, C, D, and E notes; and

   -- Affirmed its 'D (sf)' ratings on the class F and G notes.

DECO 17 - Pan Europe 7 is a 2007-vintage CMBS transaction that
initially comprised 12 commercial real estate loans, of which one
has prepaid.

The rating actions follows S&P's review of the underlying loans
and the application of its updated European commercial mortgage-
backed Securities (CMBS) criteria.

On Dec. 6, 2012, S&P placed on CreditWatch negative its ratings
on DECO 17 - Pan Europe 7's class A2, B, C, D, and E notes
following an update to its criteria for rating European CMBS
transactions.

                  WGN MF LOAN (20% OF THE POOL)

A number of German residential units secure the loan.  The
outstanding securitized balance reported in the January 2013
investor report is EUR303.6 million.  The senior loan is a pari
passu loan, with 68% of the loan securitized in this transaction.

The loan matures in April 2014.  In January 2013, the servicer
reported an interest coverage ratio (ICR) of 1.69x and a
securitized loan-to-value (LTV) ratio of 62.80%, based on an
August 2006 valuation of EUR492.2 million.

S&P do not expect the loan to experience principal losses.

                   WBN MF LOAN (19% OF THE POOL)

A number of German residential units secure the loan.  The
outstanding securitized balance reported in the January 2013
investor report is EUR287.9 million.  The senior loan is a pari
passu loan, with 66% of the loan securitized in this transaction.

The loan matures in April 2014.  In January 2013, the servicer
reported an ICR of 1.70x and a securitized LTV ratio of 65.72%,
based on an August 2006 valuation of EUR442.3 million.

S&P do not expect the loan to experience principal losses.

                    LWB LOAN (14% OF THE POOL)

A number of residential units in Leipzig, Germany, secure the
loan, which matures in April 2014.  In January 2013, the servicer
reported an ICR of 3.17x and a securitized LTV ratio of 33.9%,
based on a July 2009 valuation of EUR407.1 million.

S&P do not expect the loan to experience principal losses.

                   MAYNE LOAN (10% OF THE POOL)

Four retail properties and one office property in Germany secure
the loan.

The loan matures in October 2013 and has an outstanding
securitized balance of EUR150.3 million.  The senior loan is a
pari passu loan, with 68% of the loan securitized in this
transaction.

In January 2013, the servicer reported an ICR of 1.38x and a
securitized LTV ratio of 110.5%, based on a May 2012 valuation of
EUR136.1 million.

In S&P's opinion, full recovery of this loan appears unlikely.

                  ROCKPOINT LOAN (9% OF THE POOL)

Thirty-three German retail properties secure the loan.

The borrower did not repay the outstanding loan principal on its
original maturity date in January 2012 and is now in special
servicing.  The loan has been extended until April 20, 2014, and
the deposit account is trapping surplus cash.

In January 2013, the servicer reported an outstanding securitized
balance of EUR94.7 million, an ICR of 1.00x, and a securitized
LTV ratio of 128.5%, based on a February 2012 valuation of
EUR73.7 million.

In S&P's opinion, full recovery of this loan appears unlikely.

                   GABRIEL LOAN (8% OF THE POOL)

Thirty-four residential units in Berlin secure the loan.  The
outstanding securitized balance reported in the January 2013
investor report is EUR79.9 million.

The loan matures in April 2014.  In January 2013, the servicer
reported an ICR of 1.23x and a securitized LTV ratio of 75%,
based on a January 2007 valuation of EUR106.5 million.

In S&P's opinion, full recovery of this loan appears unlikely.

                   OTHER LOANS (20% OF THE POOL)

Properties in Germany back the remaining five loans.  S&P has
reviewed each loan individually and expect all of the loans to
experience losses, except for the NILEG MF loan.

                        INTEREST SHORTFALLS

According to the April 2013 cash manager report, the class E, F,
and G notes have continued to suffer interest shortfalls.  This
is due to the weighted-average loan margin on the loans being
insufficient to pay the weighted-average interest rate payable on
the notes.  Consequently, the available funds for the transaction
are insufficient to clear the accruing interest shortfalls on
these notes.

The class B, C, D, E and F notes are covered by an available
funds cap (AFC).  Under the AFC, any shortfalls between the
weighted-average loan margin and weighted-average interest rate
payable on the notes as a result of loan prepayments are
extinguished.

The shortfalls on the class E notes have continued since April
2012 and are covered by the AFC, in S&P's opinion.

The shortfalls on the class E and F notes have continued since
January 2010.  The initial shortfalls, which have not been
repaid, occurred as a result of a delay in a discretionary loan
margin step-up and are therefore not covered by the AFC, in S&P's
opinion.

                         RATING RATIONALE

S&P's ratings in DECO 17 - Pan Europe 7 address the timely
payment of interest, payable quarterly in arrears, and payment of
principal not later than the legal final maturity date (in July
2020).

S&P's analysis indicates that the amount of available credit
enhancement for the class A1 notes is sufficient to address its
property value loss expectations under a higher rating level
scenario.  Therefore, S&P has raised to 'AA (sf)' from 'A (sf)'
our rating on the class A1 notes.

However, the amount of available credit enhancement for the class
A2 and B notes is no longer sufficient to maintain its ratings on
these classes.  S&P has therefore lowered to 'BBB+ (sf)' from 'A
(sf)' its rating on the class A2 notes, and to 'BB+ (sf)' from
'A- (sf)' its rating on the class B notes.  S&P has removed its
ratings on the class A2 and B notes from CreditWatch negative.

In S&P's opinion, recovery of full principal appears increasingly
unlikely, and S&P believes that it is highly likely that
principal losses will affect the creditworthiness of the class C
and junior classes of notes.  Therefore S&P has lowered to 'B
(sf)' from 'BBB- (sf)' and removed from CreditWatch negative its
rating on the class C notes.  At the same time, S&P has lowered
to 'B- (sf)' from 'BB- (sf)' its rating on the class D notes, and
to 'B- (sf)' from 'B+ (sf)' its rating on the class E notes.  S&P
has removed its ratings on the class D and E notes from
CreditWatch negative.

S&P has affirmed its 'D (sf)' ratings on the class F and G notes
because they are highly vulnerable to principal losses and have
experienced continued interest shortfalls.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class                 Rating
                 To            From

DECO 17 - Pan Europe 7 Ltd.
EUR1.249 Billion Commercial Mortgage-Backed Floating-Rate Notes

Rating Raised

A1               AA (sf)       A (sf)

Ratings Lowered and Removed From CreditWatch Negative

A2               BBB+ (sf)     A (sf)/Watch Neg
B                BB+ (sf)      A- (sf)/Watch Neg
C                B (sf)        BBB- (sf)/Watch Neg
D                B- (sf)       BB- (sf)/Watch Neg
E                B- (sf)       B+ (sf)/Watch Neg

Ratings Affirmed

F                D (sf)
G                D (sf)


GERMAN RESIDENTIAL: S&P Affirms BB+ Rating on Two Note Classes
--------------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on German Residential Funding PLC's class A1, A2, B, C,
D, and E notes.

Specifically, S&P has:

   -- Placed on CreditWatch negative its rating on the class A1
      notes;

   -- Lowered and removed from CreditWatch negative its rating on
      the class A2 notes; and

   -- Affirmed and removed from CreditWatch negative its ratings
      on the class B, C, D, and E notes.

The rating actions follow S&P's review of the underlying loan's
credit quality by applying its updated European commercial
mortgage-backed securities (CMBS) criteria.

On Dec. 6, 2012, S&P placed its ratings on the class A2, B, C, D,
and E notes on CreditWatch negative following an update to its
criteria for rating European CMBS transactions.

The current securitized loan balance is EUR2,054,122,379, and the
whole-loan balance is EUR2,060,975,822.  The loan continues to
perform well, in S&P's view, although the financial ratios have
deteriorated slightly over the last four quarters with the whole-
loan interest coverage ratio (ICR) decreasing to 1.50x at the
February 2013 interest payment date (IPD) from 1.69x at the May
2012 IPD.  However, occupancy levels have remained constant at
95%.

The property portfolio comprises mainly residential units, with
the remainder being garages, parking spaces, and small commercial
units.  Geographically, the property portfolio is spread
throughout Germany, with about 60% of the properties located in
20 cities--the top six being Berlin, Hamburg, Cologne, Bielefeld,
Frankfurt, and Essen.

The borrower has continued to sell individual properties, with
the number of residential units now totaling 62,182--down from
92,278 at closing.  Following these sales, the outstanding
securitized loan balance has reduced by 23% since closing, to
EUR2.05 billion from EUR2.66 billion.  At the property portfolio
level, the monthly net cold rent per square meter for the
residential units has remained stable at EUR5.30 and for the
commercial units is EUR5.79, an increase from EUR5.64 from the
previous quarter.

                        COUNTERPARTY RISK

Under S&P's 2012 counterparty criteria, as the documents for the
account bank agreement do not comply with its 2012 counterparty
criteria, its ratings in this transaction are capped at its long-
term issuer credit rating (ICR) on Deutsche Bank AG, as account
bank.

On March 26, 2013, S&P placed its ratings on Deutsche Bank on
CreditWatch negative.

                          RATING ACTIONS

S&P's ratings in German Residential Funding address the timely
payment of interest and repayment of principal no later than
legal final maturity in August 2018.

S&P's rating on the class A1 notes could be higher for credit
reasons, but is capped at its 'A+' long-term ICR on Deutsche
Bank, as account bank.  As S&P placed its ratings on Deutsche
Bank on CreditWatch negative, it has therefore placed on
CreditWatch negative its 'A+ (sf)' rating on the class A1 notes.

S&P believes that the credit enhancement available to the class
A2 notes is insufficient to maintain the currently assigned
rating. S&P has therefore lowered to 'A (sf)' from 'A+ (sf)' and
removed from CreditWatch negative its rating on the class A2
notes.

Under S&P's updated European CMBS criteria, its analysis
indicates that the current ratings on the class B, C, D and E
notes can be maintained, as, in its view, the credit
characteristics are commensurate with the currently assigned
ratings under its stress scenarios.  S&P has therefore affirmed
and removed from CreditWatch negative its ratings on the class B,
C, D, and E notes.

German Residential Funding is a German CMBS multifamily
transaction, with loan maturity in August 2013 and note final
maturity in August 2018.  There are two borrowers--GAGFAH I
Invest GmbH & Co. KG and GAGFAH A Asset GmbH & Co. KG--which have
provided cross guarantees and are jointly and severally liable
for the debts of each other.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class             Rating
          To                   From

German Residential Funding PLC
EUR2.66 Billion Commercial Mortgage-Backed Floating-Rate Notes

Rating Placed On CreditWatch Negative

A1        A+ (sf)/Watch Neg    A+ (sf)

Rating Lowered and Removed From CreditWatch Negative

A2        A (sf)               A+ (sf)/Watch Neg

Ratings Affirmed and Removed From CreditWatch Negative

B         A- (sf)              A- (sf)/Watch Neg
C         BBB (sf)             BBB (sf)/Watch Neg
D         BB+ (sf)             BB+ (sf)/Watch Neg
E         BB+ (sf)             BB+ (sf)/Watch Neg


QUIRINUS PLC: S&P Lowers Rating on Class F Notes to 'CCC'
---------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on Quirinus (European
Loan Conduit No. 23) PLC's class A, B, C, D, and E notes.  At the
same time, S&P has lowered its rating on the class F notes.

The rating actions follow S&P's review of the underlying loans'
credit quality by applying its updated criteria for rating
European commercial mortgage-backed securities (CMBS)
transactions.

On Dec. 6, 2012, S&P placed its ratings on the class A to E notes
on CreditWatch negative following the update to its European CMBS
criteria.

          THE EUROCASTLE LOAN (72.1% OF THE POOL BALANCE)

The loan, which has an EUR85.1 million outstanding securitized
balance, matures in February 2016.  It is secured on 41 German
supermarkets, located in secondary locations and let to 57
tenants.

In February 2013, the servicer reported a 1.74x interest coverage
ratio (ICR) and a 81.23% securitized loan-to-value (LTV) ratio,
based on a December 2005 valuation of EUR104.7 million.

In S&P's opinion, losses are likely to occur on this loan in its
base case scenario.

             THE H&B3 LOAN (21.1% OF THE POOL BALANCE)

The loan, which has a EUR24.9 outstanding million securitized
balance, failed to repay at maturity in November 2012.  It is
secured on five German supermarkets located in secondary
locations.

The loan entered special servicing on Nov. 8, 2012.  The servicer
has granted standstill periods and recently extended the loan
until May 7, 2013.  The borrower has appointed Knight Frank as
the sales agent to market the portfolio.

The current reported ICR is 1.67x and the reported LTV ratio is
74.9%, based on a valuation of EUR33.3 million in November 2005.

In S&P's opinion, full recovery of this loan appears unlikely in
its base case scenario.

           THE FAIRACRE LOAN (6.8% OF THE POOL BALANCE)

The loan has a EUR8 million outstanding securitized balance.  The
loan defaulted at maturity in February 2011.  The special
servicer, Morgan Stanley Mortgage Servicing Ltd., is working out
the loan.

The borrower filed for insolvency in Luxembourg.  Insolvency
proceedings began on Dec. 9, 2011.  As of the April 2013 special
servicing report, the insolvency administrator and the Luxembourg
court have approved the sale of two of the five supermarket
assets.

The current reported ICR is 1.81x and the reported LTV ratio is
70.5%, based on a October 2009 valuation of EUR11.3 million.

In S&P's opinion, full recovery of this loan appears unlikely in
its base case scenario.

                          RATING ACTIONS

Following S&P's review and the application of its updated
European CMBS criteria, its analysis indicates that the credit
enhancement available to the class A, B, C, D, and E notes is
insufficient to absorb the underlying properties' potential
losses at the currently assigned rating levels.  Therefore, S&P
has lowered and removed from CreditWatch negative its ratings on
the class A, B, C, D, and E notes.

In S&P's opinion, the class F notes could experience principal
losses in the near term, as the insolvency administrator and the
Luxembourg court have approved the sale of two of the five assets
securing the Fairacre loan.  S&P has therefore lowered to 'CCC
(sf)' from 'B- (sf)' its rating on the class F notes.

Quirinus (ELOC 23) is a 2006-vintage true sale CMBS transaction
that reaches legal final maturity in February 2019.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class              Rating
            To               From

Quirinus (European Loan Conduit No. 23) PLC
EUR700.82 Million Commercial Mortgage-Backed Variable- and
Floating-Rate Notes

Ratings Lowered and Removed From CreditWatch Negative

A           BB+ (sf)         A (sf)/Watch Neg
B           BB (sf)          A (sf)/Watch Neg
C           B+ (sf)          A- (sf)/Watch Neg
D           B- (sf)          BBB (sf)/Watch Neg
E           B- (sf)          BB (sf)/Watch Neg

Rating Lowered

F           CCC (sf)         B- (sf)


SUNWAYS AG: Konstanz Court Opens Insolvency Process
---------------------------------------------------
pv-magazine.com reports that the Konstanz District Court opened
insolvency proceedings over Sunways AG's assets on May 7.

According to the report, the company said the decision was made
as a result of the so-called "third-party insolvency
application". The report says the preliminary insolvency
proceedings also apply to Sunways Production GmbH in Arnstadt,
Germany.  Thorsten Schleich has been appointed as the provisional
liquidator, the report discloses. Information on how things will
proceed and the impact on operations have not been announced.

pv-magazine.com notes that Sunways, in which Chinese company LDK
Solar holds majority share, have been struggling with declining
sales and heavy losses.  In April, the company decided to lay off
about half of its workforce. To add to the blow, just in April,
the banks decided to cancel an US$8.6 million credit, the report
says.

The company's board of directors has been negotiating with the
banks on a longer repayment period for the loans, pv-magazine.com
adds.


WEPA HYGIENEPRODUKTE: S&P Assigns 'BB-' CCR; Outlook Stable
-----------------------------------------------------------
Standard & Poor's Ratings Services said that it has assigned its
'BB-' long-term corporate credit rating to Germany-based tissue
paper group WEPA Hygieneprodukte GmbH (WEPA).  The outlook is
stable.

At the same time, S&P assigned a 'B+' issue rating to WEPA's
senior secured notes due 2020.  The issue rating is one notch
lower than S&P's preliminary rating of 'BB-' on the notes,
following an increase in the issue amount to EUR275 million from
EUR250 million.  S&P also assigned a recovery rating of '5' to
these notes, indicating its expectation of modest (10%-30%)
recovery in the event of a payment default.  This is a downward
revision from S&P's preliminary recovery rating of '4', to
reflect the increase in the amount of notes.

The rating reflects S&P's assessments of WEPA's financial risk
profile as "aggressive" and its business risk profile as "fair",
as defined in its criteria.

WEPA's "aggressive" financial risk profile reflects S&P's view of
the group's relatively high debt leverage, stemming from the
acquisition of Italy-based tissue producer Kartogroup in 2009.
S&P adjusts WEPA's reported debt by adding off-balance sheet
factoring lines (EUR59 million in 2012), pension liabilities
(EUR7 million), and operating leases (EUR19 million).  S&P's
assessment of the group's financial risk profile also reflects
its volatile operating cash flow generation due to exposure to
volatile input costs.  For example, in 2011, credit metrics
deteriorated significantly: Standard & Poor's-adjusted funds from
operations (FFO) to debt and debt to EBITDA fell to 3.1% and
7.9x, respectively, compared with 8.4% and 5.0x in 2010.  These
constraining factors are partly offset by the group's moderate
financial policy, long-term ownership, historically limited
dividend payments, relatively low ongoing investment
requirements, and "adequate" liquidity profile following the
refinancing with the recently issued notes.

"Our assessment of WEPA's business risk profile as "fair"
reflects our view of the group's exposure to volatile input costs
for pulp and recovered paper, which has resulted in volatile
profitability in the past.  Our assessment also reflects the
group's relatively small size and scope, and sales that are
mostly geared toward mature western European tissue markets.  In
addition, WEPA is exposed to a degree of customer concentration
because the three largest customers account for more than one-
third of group sales. These weaknesses are balanced by the
group's strong position in the private-label tissue segment in
Germany, stable and noncyclical end-customer demand, well-
invested asset base, and increased scope following the
acquisition and integration of Kartogroup," S&P said.

The European tissue paper market has in recent years benefitted
from consolidation, and has a clear market leader in Swedish pulp
and paper manufacturer Svenska Cellulosa Aktiebolaget SCA.  This
has reduced the risk of short-term price competition, in S&P's
view, which was previously an ongoing problem.  S&P also
understands that WEPA has implemented a more comprehensive
hedging program for key raw material costs such as pulp.  S&P
believes that these factors could lead to a more stable operating
performance in the future.  However, S&P still thinks that WEPA
could face difficulties in passing on increasing input costs to
its customers in the short term, and that this could lead to
volatility in its operating performance.

"In our base-case scenario, we forecast low single-digit revenue
growth in the coming years and that WEPA will be able to maintain
EBITDA margins of 10%-11% in 2013 and 2014, on the back of recent
restructuring and efficiency initiatives.  This is based on our
forecast of moderately increasing raw material costs and ongoing
portfolio optimization efforts.  Owing to relatively low annual
capital expenditures of about EUR30 million and low dividends, we
anticipate that there will be room for WEPA to decrease leverage
somewhat in 2013-2014," S&P said.

The issue rating on the senior secured notes due 2020, issued by
WEPA, is 'B+', one notch below the corporate credit rating.  The
recovery rating on the senior secured notes is '5', indicating
S&P's expectation of modest (10%-30%) recovery in the event of a
payment default.

The issue and recovery ratings on the senior secured notes are
lower than the preliminary ratings S&P originally assigned to the
notes, reflecting that WEPA increased the amount of the senior
secured note issuance to EUR275 million from EUR250 million.  S&P
envisage lower recovery prospects for the senior secured
noteholders as a result of the larger amount of senior secured
debt.

The recovery prospects on the notes are limited by the notes'
subordination to significant priority liabilities, including the
asset-backed securities (ABS) and factoring programs, which total
up to EUR90 million; and about EUR30 million of leasing.
Recovery is also constrained by the EUR90 million RCF, which
ranks above the notes according to the intercreditor agreement on
enforcement of the collateral.  On the other hand, the recovery
analysis is supported by a good tangible asset base, which
includes the 17 machines and more than 70 converting lines owned
by the company, the comprehensive security and guarantee package
provided to the noteholders, and a favorable German jurisdiction.

To calculate recoveries, S&P simulates a default scenario.  S&P
believes that a default would most likely come from an increase
in competition, which would lead to erosion in margins and a
market share loss in WEPA's key markets, combined with a rise in
raw material prices, given the volatility of the input costs.
S&P believes that a loss of tender would also impact revenues and
margins, given the group's customer concentration.

Under S&P's hypothetical default scenario, it forecasts a default
in 2017, at which point EBITDA would have declined to about
EUR54 million.  S&P values the business using a fixed-charge
approach, with a 5.5x stressed EBITDA multiple.

The stable outlook reflects S&P's view that WEPA will maintain
broadly flat organic revenues and that EBITDA margins will show
only modest improvement in the coming years.  It also takes into
account S&P's forecast of a gradual improvement in WEPA's credit
metrics, such that adjusted FFO to debt remains higher than 15%.

S&P could take a negative rating action if it sees a material
deterioration in WEPA's profitability or cash flow generation,
causing the EBITDA margin to erode significantly to less than
10%. This could be the result of increasing raw material costs,
coupled with an inability to pass them on to customers through
higher prices.  S&P could also take a negative rating action
should credit metrics fall below its current base-case
assumptions, for example, if FFO to debt falls to less than 15%,
which could stem from decreasing operational cash flow,
significant debt-funded acquisitions, or larger shareholder
distributions than S&P currently anticipates.

S&P could take a positive rating action if it believes that WEPA
could sustain adjusted FFO to debt of more than 20% and positive
free operating cash flow, while keeping profitability stable
throughout the cycle.  S&P believes this could happen if the
group increases its EBITDA margin by more than two percentage
points, while at the same time keeping investments at a moderate
level.  In S&P's view, this would require further successful
restructuring and efficiency measures, coupled with successful
price increases.



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


CONNEMARA MINING: High Court Rejects Wind Up Bid
------------------------------------------------
Ann O'Loughlin at the Irish Examiner reports that the High Court
has rejected a bid to wind up Connemara Mining plc over claims
that it is insolvent.

The report says Connemara Mining, whose executive chairman is
entrepreneur John Teeling, insisted the company was solvent and
able to pay its debts.

It had opposed a winding up petition brought by UK mining finance
company, Trampus Ltd, which is the largest single shareholder in
Connemara at 6.32%, the report relates.

Mr. Teeling and another director, James Finn, who both also
opposed the winding up as creditors, own 7.78% between them.

According to the Examiner, Trampus argued it should be wound up
because it is insolvent and that it would be just and equitable
to do so.

The company and the directors said no grounds had been
demonstrated for winding up on a just and equitable basis and it
was able to pay its debts when they fall due, the report relates.

Trampus, as a contributory which owns fully paid-up shares in the
company, did not have the required legal standing to bring the
petition as it was not a creditor, it was also argued.

According to the report, Ms. Justice Mary Laffoy said she had
come to the conclusion that under Irish law, Trampus did not have
the required standing on the grounds it brought the petition,
particularly as it had not been established the company was
unable to pay its debts or that it would be just and equitable to
wind up.

Connemara Mining plc is a mining exploration company.  It was set
up in 2006 to exploit zinc and other mineral mining opportunities
in Ireland.


IRISH BANK: Liberty Insurance Seeks 100% Control of Quinn
---------------------------------------------------------
Ciaran Hancock at The Irish Times reports that Liberty Insurance
wants 100% control over the former Quinn Insurance Group, almost
half of which is held by the Irish Bank Resolution Corporation
(IBRC), formerly Anglo Irish Bank.

Its chief executive in Ireland, Patrick O'Brien, has told The
Irish Times its Boston parent would like to acquire the 49%
shareholding in the business held by IBRC "sooner rather than
later".

Mr. O'Brien declined to comment on how much IBRC's stake would be
worth, the Irish Times notes.

However, he revealed the liquidation of IBRC took Liberty by
"surprise", according to the Irish Times.

The Government put IBRC into liquidation in February and the
special liquidators at KPMG are to value its assets and either
sell them by August or transfer them to the National Asset
Management Agency (NAMA), which will dispose of them in time, the
Irish Times recounts.

In November 2011, Liberty provided EUR102 million for a 51% stake
in the former Quinn insurance business, the Irish Times relates.
IBRC took the balance as part of a EUR200 million
recapitalization, the Irish Times notes.

Given his role as head of the Irish insurer, Mr. O'Brien is not
directly involved in discussions with KPMG on the IBRC stake,
which are being handled from Boston, the Irish Times states.

Mr. O'Brien, as cited by the Irish Times, said it was "business
as usual" at the Irish insurer but the uncertainty over IBRC was
not helpful.

IBRC provided EUR98 million as part of the recapitalization of
the former insurer, which had been placed into administration by
the Central Bank, the Irish Times discloses.  In theory, this was
the value placed on its 49% stake in the business, the Irish
Times notes.

Anglo Irish Bank was an Irish bank headquartered in Dublin from
1964 to 2011.  It went into wind-down mode after nationalization
in 2009.  In July 2011, Anglo Irish merged with the Irish
Nationwide Building Society, with the new company being named the
Irish Bank Resolution Corporation.

Standard & Poor's Ratings Services said that it lowered its long-
and short-term counterparty credit ratings on Irish Bank
Resolution Corp. Ltd. (IBRC) to 'D/D' from 'B-/C'.   S&P also
lowered the senior unsecured ratings to 'D' from 'B-'.  S&P then
withdrew the counterparty credit ratings, the senior unsecured
ratings, and the preferred stock ratings on IBRC.  At the same
time, S&P affirmed its 'BBB+' issue rating on three government-
guaranteed debt issues.

The rating actions follow the Feb. 6, 2013, announcement that the
Irish government has liquidated IBRC.



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


BANCA MONTE: May Report Fourth Straight Quarterly Loss
------------------------------------------------------
Sonia Sirletti and Francesca Cinelli at Bloomberg News report
that Banca Monte dei Paschi di Siena, the bailed-out Italian bank
embroiled in a fraud probe, will probably report a fourth
straight quarterly loss as lending income falls.

Monte Paschi may post a net loss of EUR154 million (US$200
million) when it publishes results today, May 15, compared with a
profit of EUR88.5 million a year earlier, according to the
average estimate of nine analysts surveyed by Bloomberg.

Chief Executive Officer Fabrizio Viola must return the bank to
profit this year under Monte Paschi's EUR4.1 billion rescue plan
to avoid handing a stake to the government, Bloomberg discloses.
In the meantime, prosecutors are probing whether former managers
at the Siena-based bank, which piled up a total loss of EUR7.9
billion in the past two years, used derivative contracts to
obscure the losses, Bloomberg says.

"For the time being, the bank's revenue generation is
insufficient to cover the deteriorating asset quality," Bloomberg
quotes Luigi Tramontana, an analyst at Banca Akros in Milan, as
saying in an e-mailed report to clients last week.  "The
management is working on further restructuring, but asset
disposals will be difficult to achieve in the current context."

Revenue may drop 31% to EUR1.04 billion in the first quarter from
a year earlier, hurt by lower income from lending and the cost of
state aid, Bloomberg  says, citing the average estimate of seven
analysts.

The bank is paying an annual coupon of 9% on the EUR4.1 billion
of debt sold to the government in the bailout, Bloomberg
discloses.  Should Monte Paschi post a 2013 loss, it will have to
pay the coupon in the form of new shares, issued at market value,
Bloomberg states.

At the current price of about 21 cents, the government would
receive some 1.74 billion shares, or about 13% of Monte Paschi,
according to Bloomberg calculations.  The state would hence
become the bank's second-biggest shareholder after Fondazione
Monte dei Paschi di Siena, a Siena-based foundation that
currently owns 35% of the firm, Bloomberg notes.

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

                          *     *     *

As reported by the Troubled Company Reporter-Europe on Feb. 4,
2013, Standard & Poor's Ratings Services said that it lowered its
long-term counterparty credit rating on Italy-based Banca Monte
dei Paschi di Siena SpA (MPS) to 'BB' from 'BB+'. S&P also
lowered its rating on MPS' Lower Tier 2 subordinated notes to
'CCC+' from 'B-'.  These ratings remain on CreditWatch, where S&P
originally placed them with negative implications on Dec. 5,
2012.  S&P lowered the ratings on MPS' junior subordinated debt
to 'CCC' from 'CCC+' and on its preferred stock to 'CCC-' from
'CCC'.  S&P also placed these ratings on CreditWatch with
negative implications.  S&P affirmed its 'B' short-term
counterparty credit rating on the bank.  The downgrade follows
MPS' recent announcement related to the investigation of
potential losses on three structured transactions.



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


UKIO BANKAS: Appeals Bankruptcy Order in Lithuania Court
--------------------------------------------------------
Brian McLauchlin at BBC Scotland reports that an appeal has been
lodged with a court in Lithuania over the bankruptcy order placed
on Ukio Bankas, which is Hearts' main creditor.

According to BBC Scotland, fears had been raised about the future
of the football club following the collapse of major shareholder
Vladimir Romanov's financial empire.

A judge will now set a date for the appeal to be heard in the
Lithuanian capital, Vilnius, BBC Scotland says.

Hearts owe the bank about GBP15 million and a further GBP10
million to parent company UBIG, which is controlled by
Mr. Romanov, BBC Scotland discloses.

Ukio Bankas was placed in temporary administration earlier this
year with liabilities close to GBP400 million and all its
branches have now closed, BBC Scotland recounts.

                       About Ukio Bankas

Ukio Bankas AB is a Lithuania-based commercial bank, which is
involved in the provision of banking, financial, investment, life
insurance and leasing services to individuals and companies.  It
is Lithuania's sixth largest lender by assets.  The Central Bank
suspended Ukio Bankas' operations on Feb. 12, 2013, after it was
established the lender had been involved in risky activities.  A
majority 64.9% of Ukio Bankas had been owned by Russian born-
businessman Vladimir Romanov.



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


MONIER GROUP: Fitch Affirms 'B' Long-Term Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has affirmed Monier Group S.a r.l.'s Long-term
Issuer Default Rating (IDR) at 'B', super senior RCF at
'BB'/'RR1' and senior secured bank debt at 'B+'/'RR3'. The
Outlook on the Long-term IDR is Negative. The agency has
simultaneously withdrawn all the ratings.

Fitch has withdrawn the ratings as Monier has no public debt
outstanding.



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


CLONDALKIN INDUSTRIES: S&P Puts 'B-' CCR on CreditWatch Positive
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it placed its 'B-'
long-term corporate credit rating on Clondalkin Industries B.V.
on CreditWatch with positive implications.

At the same time, S&P placed on CreditWatch with positive
implications its 'BB-' issue rating on the senior secured
revolving credit facility (RCF); its 'B-' issue ratings on the
EUR300 million and US$150 million senior secured floating-rate
notes due December 2013; and its 'CCC' issue rating on the
EUR170 million senior subordinated notes due March 2014 (all
issued by Clondalkin).

The CreditWatch placements follow Clondalkin's announcement that
it intends to refinance its existing senior secured notes, the
first of which fall due in December 2013.  The CreditWatch
placements reflect S&P's forecast that the proposed refinancing
will improve the group's credit metrics in the financial year to
Dec. 31, 2013.

The group will repay its existing senior secured notes by issuing
a new US$350 million first-lien term loan, due 2020, and a new
US$105 million second-lien term loan, due 2021.  Total proceeds
from these new debt facilities will be US$455 million.
Clondalkin will also issue a new US$35 million revolving credit
facility (RCF) due 2018, which S&P assumes will remain undrawn.

In addition, Clondalkin expects to realize proceeds of about
EUR136 million (net of fees) from the completion of the disposals
of its North American Flexible Packaging and Dutch Van der Windt
businesses.

Clondalkin will also raise about EUR60 million from the
securitization of its receivables book.  S&P adds the facility
value of EUR60 million to the group's total debt, in accordance
with its criteria.

The group will use the proceeds of the disposals, together with
the proceeds from the proposed US$350 million first-lien loan,
the proposed US$105 million second-lien loan, the new EUR60
million receivables securitization facility, and EUR113 million
of existing cash on the group's balance sheet, to repay the
existing EUR585 million-equivalent of fixed and floating-rate
notes.

Finally, Clondalkin's parent has agreed to convert EUR130 million
of shareholder loans and accrued interest into equity, which S&P
views as credit-positive.

S&P aims to resolve the CreditWatch placement after confirmation
that Clondalkin has successfully issued the proposed new term
loans, finalized the receivables securitization facility, and
repaid the existing fixed- and floating-rate notes.

Following the refinancing of the existing notes, S&P would likely
raise its corporate credit rating on Clondalkin by one notch.

In contrast, S&P would remove the ratings from CreditWatch and
affirm them if the group does not successfully refinance the
existing fixed- and floating-rate notes at least six months
before the first maturity in December 2013.


CSM NV: Weak Profitability Prompts Moody's to Assign B2 CFR
-----------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating
(CFR) and a B2-PD Probability of Default Rating (PDR) to the
acquiring company of the global bakery supplies business of
Netherlands-based CSM NV ("CSM Bakery Supplies").

Moody's also assigned a B1 rating to the proposed $650 million
first-lien term loan and a B3 rating to the proposed $200 million
second-lien term loan being raised to fund the leveraged buyout
of the business. A separate proposed asset-based revolving credit
facility will not be rated by Moody's. The ratings outlook is
stable.

The assigned ratings are subject to closing of the pending
acquisition of CSM Bakery Supplies by entities affiliated with
Rhone Capital under the terms and capital structure currently
contemplated. In March 2013, affiliates of Rhone Capital agreed
to purchase CSM Bakery Supplies from Netherlands-based CSM NV for
an enterprise value of EUR1,050 million. The transaction
contemplates the formation of a new UK-based holding company that
will be a guarantor of $1 billion of proposed senior secured debt
instruments (approximately $870 million drawn at closing) that
will be issued through Mill US Acquisition LLC, a newly-formed
US-based subsidiary.

Ratings Rationale:

The B2 Corporate Family Rating reflects relatively high closing
debt/EBITDA that Moody's estimates at 5.5 times (after Moody's
accounting adjustments) and weak operating profit margin that has
fallen to low single-digits in recent years due to a difficult
operating environment in North America and in Europe, including
high input inflation and soft consumer spending. Moody's expects
operating performance to improve under the control of Rhone
Capital, which has successfully managed complex cross-border
acquisitions in the past. However, execution risks related to
planned operating strategy shifts in North America and Western
Europe and high exposure to commodity input prices could result
in earnings volatility over the next 18 months.

Ratings assigned:

CSM Bakery Supplies:

Corporate Family Rating at B2;

Probability of Default Rating at B2-PD.

Mill US Acquisition LLC:

US$650 million of proposed senior secured first-lien debt at B1
(LGD3, 33%);

US$200 million of proposed senior secured second-lien debt at B3
(LGD4, 68%).

The ratings outlook is stable.

The senior secured first-lien debt is rated one-notch above the
Corporate Family Rating reflecting its senior position in the
capital structure to at least $200 million of other secured debt
instruments. The senior secured second-lien debt is rated one
notch below the Corporate Family Rating reflecting its junior
position in the capital structure to $650 million of first-lien
debt and a proposed $150 million asset-backed revolver (not
rated).

A ratings upgrade could occur if CSM Bakery Supplies is able to
reduce and sustain debt/EBITDA below 4.75 times and significantly
improve EBITA margins. Conversely, ratings could be lowered if
debt/EBITDA rises above 6.0 times.

CSM Bakery Supplies produces and distributes bakery products and
ingredients for artisan and industrial bakeries, and for in-store
and out-of-home markets, mainly in Europe and North America. The
company supplies customers with finished or semi-finished
products and bakery ingredients. In 2012, CSM Bakery Supplies
generated net sales of approximately $3.4 billion.

The principal methodology used in this rating was the Global
Packaged Goods published in December 2012. Other methodologies
used include Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in
June 2009.

CSM NV, headquartered in Amsterdam (Diemen), Netherlands, is the
largest supplier of bakery products worldwide and is a global
market leader in lactic acid and lactic acid derivatives. CSM NV
currently generates annual sales of EUR 3.3 billion.



===============
P O R T U G A L
===============


DOURO MORTGAGES: S&P Affirms 'B' Rating on Class C Notes
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its credit ratings on
all classes of notes in SAGRES Sociedade de Titularizacao de
Creditos, S.A.'s series Douro Mortgages No. 2 and series Douro
Mortgages No. 4.

The rating actions follows S&P's credit and cash flow analysis of
the most recent information that it has received for the
transactions and the application of its relevant criteria.  S&P
also consider that the application of its 2012 counterparty
criteria does not constrain its ratings in the transactions.

                           COUNTRY RISK

S&P's non-sovereign ratings criteria cap the maximum potential
ratings in structured finance transactions at five notches above
the speculative-grade rating on the sovereign in which the
securitized assets are based.  Therefore, S&P's nonsovereign
ratings criteria cap at 'A- (sf)' its ratings in Portuguese
residential mortgage-backed securities (RMBS) transactions.  This
is five notches above S&P's long-term rating on Portugal
(BB/Stable/B).  The Douro Mortgages transactions are exposed to
country risk because of the 100% concentration of the securitized
assets in Portugal.

In S&P's opinion, the recession and rising unemployment
associated with increased country risk may affect obligors'
ability to pay the originator and servicer the amounts due under
the mortgages. To account for this increased country risk,
following S&P's revised assessment of Portuguese country risk on
March 7, 2012, it has incorporated a 30% adjustment to the
portfolio's weighted-average foreclosure frequency (WAFF) in
S&P's analysis.

Following the incorporation of increased country risk in S&P's
credit analysis and following the application of its Portuguese
RMBS criteria, S&P's WAFF assumptions have increased at all
rating levels in Douro Mortgages No. 2 and No. 4 due to observed
increased 90+ days arrears and S&P's forecast of a deteriorating
credit performance for both transactions.  S&P has increased its
weighted-average loss severity (WALS) assumptions at all rating
levels in both transactions due to the ongoing Portuguese house
price declines.

                       DOURO MORTGAGES NO. 2

Since the second quarter of 2011, the reserve fund has amortized
according to the transaction documentation and is currently at
its required level.  Both severe arrears (90+ days) and
cumulative defaults have increased between April 2011 and January
2013. Severe arrears have risen to 0.76% in January 2013 from
0.46% in April 2011.  The net cumulative default ratio has also
increased to 0.68% from 0.41% during the same period.  Douro
Mortgages No. 2 is among the best performing transactions in
S&P's Portuguese RMBS index.  It has been able to generate
sufficient excess spread to clear its principal deficiency ledger
(PDL) and pay interest to the class E noteholders.

In S&P's analysis, all classes of notes passed its cash flow
stresses at their current rating levels.  In S&P's view, this is
because the notes have sufficient available credit enhancement
and they benefit from the transaction's structural features,
including subordination, a reserve fund, and an interest rate
swap.  S&P has therefore affirmed its ratings on the class A1,
A2, B, C, and D notes.

                      DOURO MORTGAGES NO. 4

Despite Douro Mortgages No. 4's more risky portfolio profile in
terms of year of origination, loan-to-value ratio, and current
level of arrears, the transaction has outperformed S&P's RMBS
Portuguese index.  Both severe arrears (90+ days) and cumulative
defaults have increased between June 2011 and March 2013.  Severe
arrears have risen to 1.31% in March 2013 from 0.80% in June
2011. The net cumulative default ratio has also increased to
1.82% from 0.49% during the same period.  The reserve fund is
fully funded. It is generating enough excess spread to cure the
PDL and pay interest to the class D noteholders.

S&P believes that the available credit enhancement is sufficient
to support its current rating after the application of its cash
flow stresses.  S&P has therefore affirmed its 'A- (sf)' rating
on the class A notes.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class                 Rating
            To                   From

SAGRES Sociedade de Titularizacao de Creditos, S.A.
EUR1.509 Billion Mortgage-Backed Floating-Rate Notes
(Douro Mortgages No. 2)

Ratings Affirmed

A1          A- (sf)
A2          A- (sf)
B           BB (sf)
C           B (sf)
D           B- (sf)

SAGRES Sociedade de Titularizacao de Creditos, S.A.
EUR1.523 Billion Mortgage-Backed Floating-Rate Notes (Douro
Mortgages No. 4)

Rating Affirmed

A           A- (sf)



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


GLOBAL HIPOTECARIO I: Moody's Cuts Rating on Cl. C Notes to Caa2
----------------------------------------------------------------
Moody's Investors Service downgraded the ratings of 6 notes and
confirmed the ratings of 3 notes in four Spanish residential
mortgage-backed securities (RMBS) transactions: Ayt Colaterales
Global Hipotecario Vital I, Ayt Colaterales Global Hipotecario
Caixa Galicia II, Ayt Hipotecario Mixto III and MBSCAT 1.
Insufficiency of credit enhancement to address sovereign risk and
revision of key collateral assumptions has prompted the downgrade
action.

This rating action concludes the review of 7 notes placed on
review on July 2, 2012, following Moody's downgrade of Spanish
government bond ratings to Baa3 from A3 on June 13, 2012. This
rating action also concludes the review of 2 notes placed on
review on November 23, 2012, following Moody's revision of key
collateral assumptions for the entire Spanish RMBS market.

Ratings Rationale:

The rating action primarily reflects the insufficiency of credit
enhancement to address sovereign risk and revision of key
collateral assumptions. Moody's confirmed the ratings of
securities whose credit enhancement and structural features
provided enough protection against sovereign, revision of
collateral assumptions and counterparty risk.

The determination of the applicable credit enhancement driving
these rating actions reflect the introduction of additional
factors in Moody's analysis to better measure the impact of
sovereign risk on structured finance transactions.

Additional Factors Better Reflect Increased Sovereign Risk

Moody's has supplemented its analysis to determine the loss
distribution of securitized portfolios with two additional
factors, the maximum achievable rating in a given country (the
local currency country risk ceiling) and the applicable portfolio
credit enhancement for this rating. With the introduction of
these additional factors, Moody's intends to better reflect
increased sovereign risk in its quantitative analysis, in
particular for mezzanine and junior tranches.

The Spanish country ceiling, and therefore the maximum rating
that Moody's will assign to a domestic Spanish issuer including
structured finance transactions backed by Spanish receivables, is
A3. Moody's Individual Loan Analysis Credit Enhancement (MILAN
CE) represents the required credit enhancement under the senior
tranche for it to achieve the country ceiling. By lowering the
maximum achievable rating for a given MILAN, the revised
methodology alters the loss distribution curve and implies an
increased probability of high loss scenarios.

Revision of Key Collateral Assumptions

During its review Moody's increased its Milan assumption in Ayt
Colaterales Global Hipotecario Caixa Galicia II and MBSCAT 1 to
16% and 17% respectively. The revised Milan CE reflects the
exposure to high LTV loan and non-Spanish residents in AYT
Colaterales Global Hipotecario Caixa Galicia II, and to flexible
mortgage loans in MBSCAT 1. Moody's maintained the current MILAN
CE assumptions of 23.4% in Ayt Hipotecario Mixto III and 14% in
Ayt Colaterales Global Hipotecario Vital I.

Moody's has revised its lifetime loss expectation (EL) assumption
in MBSCAT 1 because of worse-than-expected collateral performance
since the last review of the Spanish RMBS sector in November
2012. Moody's increased the EL in MBSCAT 1 from 3 to 4% of
original pool balance. Moody's maintained the current expected
loss assumptions at 3.5%, 2.45% and 4.76% of original pool
balance in Ayt Colaterales Global hipotecario Vital I, Ayt
Colaterales Global Hipotecario Caixa Galicia II, Ayt Hipotecario
Mixto III respectively.

Exposure to Counterparty Risk

The conclusion of Moody's rating review takes into consideration
the exposure to the servicers, also acting as collection account
banks, in each transaction: CaixaBank (Baa3/P3) and Banco Mare
Nostrum (NR) for Ayt Hipotecario Mixto III, Kutxabank (Ba1/NP)
for Ayt Colaterales Global Hipotecario Vital I, NCG Banco (B1
under review for possible downgrade) for Ayt Colaterales Global
Hipotecario Caixa Galicia II and Catalunya Banc (B1 under review
for possible downgrade) for MBSCAT 1. The review also takes into
consideration the exposure to the treasury account held at Banco
Santander (Baa2/P2) and the reinvestment account held at Bank of
Spain in MBSCAT 1. The revised ratings in all four transactions
were not affected by the current exposure to these
counterparties.

Moody's rating action takes into consideration the exposure to
the swap counterparties in each transaction: Banco Bilbao Vizcaya
Argentaria (Baa3/P-3) and CECA (Ba1 under review) for Ayt
Hipotecario Mixto III, Kutxabank (Ba1/NP) for Ayt Colaterales
Global Hipotecario Vital I, CECA (Ba1 under review) for Ayt
Colaterales Global Hipotecario Caixa Galicia II and Banco Bilbao
Vizcaya Argentaria (Baa3/P-3) for MBSCAT 1. Moody's notes that
the swaps do not reflect Moody's de-linkage criteria. The rating
agency has assessed the probability and effect of a default of
the swap counterparties on the ability of the issuer to meet its
obligations under the transactions. Additionally, Moody's has
examined the effect of the loss of any benefit from the swap and
any obligation the issuer may have to make a termination payment.
In conclusion, these factors did not negatively affect the rating
on the notes.

Other Developments May Negatively Affect the Notes

In consideration of Moody's new adjustments, any further
sovereign downgrade would negatively affect structured finance
ratings through the application of the country ceiling or maximum
achievable rating, as well as potentially increased portfolio
credit enhancement requirements for a given rating.

As the euro area crisis continues, the ratings of structured
finance notes remain exposed to the uncertainties of credit
conditions in the general economy. The deteriorating
creditworthiness of euro area sovereigns as well as the weakening
credit profile of the global banking sector could further
negatively affect the ratings of the notes.

Moody's describes additional factors that may affect the ratings
in "Approach to Assessing Linkage to Swap Counterparties in
Structured Finance Cashflow Transactions: Request for Comment".

Methodologies

The methodologies used in these ratings were "Moody's Approach to
Rating RMBS Using the MILAN Framework" published in March 2013,
and "The Temporary Use of Cash in Structured Finance
Transactions: Eligible Investment and Bank Guidelines" published
in March 2013.

In reviewing these transactions, Moody's used its cash flow
model, ABSROM, to determine the loss for each tranche. The cash
flow model evaluates all default scenarios that are then weighted
considering the probabilities of the lognormal distribution
assumed for the portfolio default rate. In each default scenario,
Moody's calculates the corresponding loss for each class of notes
given the incoming cash flows from the assets and the outgoing
payments to third parties and noteholders. Therefore, the
expected loss for each tranche is the sum product of (1) the
probability of occurrence of each default scenario and (2) the
loss derived from the cash flow model in each default scenario
for each tranche.

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

In the context of the rating review, the transactions have been
remodeled and some inputs have been adjusted to reflect the new
approach.

List of Affected Ratings

Issuer: AyT Colaterales Global Hipotecario Vital I, FTA

EUR175.3M A Notes, Confirmed at A3 (sf); previously on Jul 2,
2012 Downgraded to A3 (sf) and Remained On Review for Possible
Downgrade

EUR12.6M B Notes, Confirmed at Ba3 (sf); previously on Jul 2,
2012 Ba3 (sf) Placed Under Review for Possible Downgrade

EUR8.2M C Notes, Downgraded to Caa2 (sf); previously on Jul 2,
2012 B3 (sf) Placed Under Review for Possible Downgrade

Issuer: AyT Colaterales Global Hipotecario, FTA Caixa Galicia II

EUR855M A Notes, Confirmed at A3 (sf); previously on Jul 2, 2012
Downgraded to A3 (sf) and Placed Under Review for Possible
Downgrade

EUR44.6M B Notes, Downgraded to Ba1 (sf); previously on Jul 2,
2012 Baa3 (sf) Placed Under Review for Possible Downgrade

EUR38M C Notes, Downgraded to B2 (sf); previously on Jul 2, 2012
B1 (sf) Placed Under Review for Possible Downgrade

Issuer: AyT Hipotecario Mixto III Fondo de Titulizacion de
Activos

EUR342.2M A Notes, Downgraded to Baa3 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible
Downgrade

Issuer: MBSCAT 1, FTA

EUR47.2M B Notes, Downgraded to Baa3 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible
Downgrade

EUR39.4M C Notes, Downgraded to B3 (sf); previously on Jul 2,
2012 Ba2 (sf) Placed Under Review for Possible Downgrade


CAIXA PENEDES 2: Moody's Lowers Rating on Class C Notes to 'B3'
---------------------------------------------------------------
Moody's Investors Service downgraded the ratings of five junior
and one senior notes in three Spanish residential mortgage-backed
securities (RMBS) transactions: AyT Hipotecario Mixto II, Caixa
Penedes 2 and IM BCG RMBS 1. At the same time, Moody's confirmed
the ratings of one senior note in IM BCG RMBS 1. Insufficiency of
credit enhancement to address sovereign risk and revision of key
collateral assumptions has prompted this downgrade.

This rating action concludes the review of five notes placed on
review on July 2, 2012, following Moody's downgrade of Spanish
government bond ratings to Baa3 from A3 on June 13, 2012. This
rating action also concludes the review of two notes placed on
review on November 23, 2012, following Moody's revision of key
collateral assumptions for the entire Spanish RMBS market.

Ratings Rationale:

This rating action primarily reflects the insufficiency of credit
enhancement to address sovereign risk and revision of key
collateral assumptions. Moody's confirmed the ratings of
securities whose credit enhancement and structural features
provided enough protection against sovereign and counterparty
risk.

The determination of the applicable credit enhancement driving
these rating actions reflects the introduction of additional
factors in Moody's analysis to better measure the impact of
sovereign risk on structured finance transactions.

Additional Factors Better Reflect Increased Sovereign Risk

Moody's has supplemented its analysis to determine the loss
distribution of securitized portfolios with two additional
factors, the maximum achievable rating in a given country (the
Local Currency Country Risk Ceiling) and the applicable portfolio
credit enhancement for this rating. With the introduction of
these additional factors, Moody's intends to better reflect
increased sovereign risk in its quantitative analysis, in
particular for mezzanine and junior tranches.

The Spanish country ceiling, and therefore the maximum rating
that Moody's will assign to a domestic Spanish issuer including
structured finance transactions backed by Spanish receivables, is
A3. Moody's Individual Loan Analysis Credit Enhancement (MILAN
CE) represents the required credit enhancement under the senior
tranche for it to achieve the country ceiling. By lowering the
maximum achievable rating for a given MILAN, the revised
methodology alters the loss distribution curve and implies an
increased probability of high loss scenarios.

Revision of Key Collateral Assumptions

Moody's has revised its lifetime loss expectation (EL) assumption
in AyT Hipotecario Mixto II pool CH because of worse-than-
expected collateral performance since the last review of the
Spanish RMBS sector in November 2012. The share of 90d+ arrears
currently stands at 2.65% of current pool balance, up from 2.1%
as of the previous review while cumulative defaults more than
doubled, from 0.07% of the original pool balance to 0.19%.
Moody's have updated the EL assumption to 0.81% of original pool
balance. Moody's has maintained its EL assumptions at 0.49% in
AyT Hipotecario Mixto II Pool PH, 1.20% in Caixa Penedes 2 TDA,
and 1,65% in IM BCG RMBS 1.

During its review Moody's also reassessed the MILAN CE
assumptions of the transactions underlying portfolios based on
available loan-by-information. As a result, Moody's maintained
the MILAN CE assumption at 12.5% in AyT Hipotecario Mixto II Pool
CH, and 10.0% in AyT Hipotecario Mixto II Pool CH, Caixa Penedes
2 TDA and IM BCG RMBS 1.

Exposure to Counterparty Risk

The conclusion of Moody's rating review also takes into
consideration the exposure to Banco Santander (Baa2, P-2) acting
as Issuer Account Bank and interest rate swap provider in IM BCG
RMBS 1. Moody's concluded that this exposure does not affect
negatively the ratings of the notes in this transaction.

Other Developments May Negatively Affect The Notes

In consideration of Moody's new adjustments, any further
sovereign downgrade would negatively affect structured finance
ratings through the application of the country ceiling or maximum
achievable rating, as well as potentially increased portfolio
credit enhancement requirements for a given rating.

As the euro area crisis continues, the ratings of structured
finance notes remain exposed to the uncertainties of credit
conditions in the general economy. The deteriorating
creditworthiness of euro area sovereigns as well as the weakening
credit profile of the global banking sector could further
negatively affect the ratings of the notes.

Additional factors that may affect the ratings are described in
the "Approach to Assessing Linkage to Swap Counterparties in
Structured Finance Cashflow Transactions: Request for Comment".

The methodologies used in these ratings were Moody's Approach to
Rating RMBS Using the MILAN Framework published in March 2013,
and The Temporary Use of Cash in Structured Finance Transactions:
Eligible Investment and Bank Guidelines published in March 2013.

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

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

In the context of the rating review, the transactions have been
remodeled and some inputs have been adjusted to reflect the new
approach. In addition, for IM BCG RMBS 1 Moody's corrected the
input for the swap margin. For AyT Hipotecario Mixto II the
artificial write off mechanism modeling has been corrected.

List of Affected Ratings:

Issuer: AyT Hipotecario Mixto II Fondo de Titulizacion de Activos

EUR12.7M CH2 Notes, Downgraded to Baa3 (sf); previously on Jul 2,
2012 Baa1 (sf) Placed Under Review for Possible Downgrade

EUR16.7M PH2 Notes, Downgraded to Ba3 (sf); previously on Jul 2,
2012 Baa3 (sf) Placed Under Review for Possible Downgrade

Issuer: CAIXA PENEDES 2 TDA FTA

EUR726.3M A Notes, Downgraded to Baa1 (sf); previously on Jul 2,
2012 Downgraded to A3 (sf) and Remained On Review for Possible
Downgrade

EUR7.2M B Notes, Downgraded to Ba2 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible
Downgrade

EUR16.5M C Notes, Downgraded to B3 (sf); previously on Jul 2,
2012 Baa2 (sf) Placed Under Review for Possible Downgrade

Issuer: IM BCG RMBS 1, FTA

EUR388M A Notes, Confirmed at Baa1 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible
Downgrade

EUR12M B Notes, Downgraded to Ba2 (sf); previously on Jul 2, 2012
Baa3 (sf) Placed Under Review for Possible Downgrade


FTPYME TDA: Fitch Affirms 'CCC' Rating on Class 3SA Notes
---------------------------------------------------------
Fitch Ratings has affirmed FTPYME TDA 2, FTA as follows:

EUR10.5m class 2CA notes affirmed at 'BBB', Outlook Negative

EUR2.6m class 2SA notes affirmed at 'BBB', Outlook Negative

EUR4.5m class 3SA notes affirmed at 'CCC', Recovery Estimate
revised to 45% from 85%

Key Rating Drivers

The affirmation is based on the increased credit enhancement
since the last review in May 2012 which offsets volatility
performance in terms of delinquencies in the underlying
portfolio. Since then the portfolio's outstanding balance was
reduced to 11.7% of the initial balance from 16.6%. Consequently,
credit enhancement for the class 2CA and class 2SA notes
increased to 35.2% from 28.3%.

Delinquencies between 90 and 180 have been volatile in the past
few months with a peak being reported at the end of 2012. This
was due to a bullet loan that had passed its final maturity
without being paid in full and consequently became delinquent. In
the subsequent month the loan was recovered. At the same time the
weighted average recovery rate was accelerated, which has
increased to 78.7% from 54.5% at the last review. Overall,
delinquencies increased slightly since May 2012, but current
defaults decreased to 1.8% of the current pool size from 2.8%.

In general obligor concentration was reduced. The largest obligor
now represents 2.8% of the portfolio and the ten largest 22.79%,
compared to 5.8% and 23.7% at the last review, respectively.

Class 2CA and class2 SA are ranked pari passu and pay pro rata.
Additionally, class 2CA is guaranteed by the Kingdom of Spain
('BBB'/Negative/'F2'). The Negative Outlook on the senior notes
reflects the transaction's sensitivity to potential portfolio
deterioration and the increased portfolio concentration.

Rating Sensitivities

The agency has included additional stress scenarios to ensure the
ratings' stability. The first scenario tested the ratings'
sensibility to a decrease in recovery rate assumptions by 25% and
the second simulated increased default probabilities by 25%. The
results suggested that neither of the scenarios would trigger a
rating action.

FTPYME TDA 6, F.T.A. (the issuer) is a static cash flow SME CLO
originated by Banco Guipuzcoano. On closing the issuer used the
note proceeds to purchase a EUR150m portfolio of secured and
unsecured loans granted to Spanish small and medium enterprises
and self-employed individuals.


IM GRUPO BANCO: S&P Affirms 'B' Rating on Class D Notes
-------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on IM GRUPO BANCO POPULAR FTPYME II, Fondo de
Titulizacion de Activos' outstanding EUR262.81 million notes.

Specifically, S&P has:

   -- Lowered to 'A (sf)' from 'A+ (sf)' its rating on the class
      B notes and lowered to 'BBB (sf)' from 'BBB+ (sf)' its
      rating on the class C notes; and

   -- Affirmed its 'AA- (sf)' rating on the class A3(G) notes,
      its 'B (sf)' rating on the class D notes, and its 'D (sf)'
      rating on the class E notes.

The rating actions follows S&P's assessment of the transaction's
performance using the latest available trustee reports (dated
March and April 2013) and portfolio data from the servicer, as
well as the application of S&P's updated criteria for European
collateralized loan obligations (CLOs) backed by small and
midsize enterprises (SMEs) and other relevant criteria.

                         CREDIT ANALYSIS

Based on S&P's review of the current pool and since its previous
full review of the capital structure in July 2011, the pool has
experienced further defaults and the obligor concentration risk
has further increased due to the further deleveraging of loans.
The interest on the class E notes continues to be deferred as of
the April 2013 interest payment date report.

The underlying pool is highly seasoned with a pool factor (the
percentage of the pool's outstanding aggregate principal balance
in comparison with the closing date) of 11.25%.  Loans originated
in 2006 now represent the highest proportion of the current
outstanding pool.  According to the March 2013 trustee report,
12+ months cumulative defaults account for 3.68% of the closing
pool balance (compared with 2.43% at our July 2011 review).  The
recovery rates reported on these defaults are in the range of 38%
to 39%.

The reserve fund (with a current balance of EUR29.7 million) has
experienced further draws since S&P's July 2011 review and is
still below the required level of EUR47 million.

S&P has applied its updated European SME CLO criteria to
determine the scenario default rates (SDRs) for this transaction.

S&P categorizes the originator as moderate (based on tables 1, 2,
and 3 in its criteria), which factored in Spain's Banking
Industry Country Risk Assessment (BICRA) of 6 (as the country of
origin for these SME loans is Spain).  This resulted in a
downward adjustment of one notch to the 'b+' archetypical
European SME average credit quality assessment to determine loan-
level rating inputs and applying the 'AAA' targeted corporate
portfolio default rates.  As a result, S&P's average credit
quality assessment of the pool is 'b'.

S&P further applied a portfolio selection adjustment of minus
three notches to the 'b' credit quality assessment, which it
based on its review of the current pool characteristics, compared
with the originator's other transactions.  As a result, S&P's
average credit quality assessment of the pool to derive the
portfolio's 'AAA' SDR was 'ccc'.

S&P has applied this approach as it was not provided with the
internal credit scores upon request, therefore S&P assumed that
each loan in the portfolio had a credit quality that is equal to
its average credit quality assessment of the portfolio.

S&P has assessed Spain's current market trends and developments,
macroeconomic factors, and the way these factors are likely to
affect the loan portfolio's creditworthiness.

As a result of this analysis, S&P's 'B' SDR is 11.74%.

The SDRs for rating levels between 'B' and 'AAA' are interpolated
in accordance with S&P's European SME CLO criteria.

                           COUNTRY RISK

In S&P's cash flow analysis, the class A3(G) notes pass at higher
ratings than the currently assigned rating.  However, given that
S&P's long-term rating on the Kingdom of Spain is 'BBB-',
according to its nonsovereign ratings criteria, S&P has affirmed
its 'AA- (sf)' rating on the class A3(G) notes.

The class A3(G) notes benefit from a guarantee provided by the
Kingdom of Spain.  The guarantee from the Kingdom of Spain can be
drawn either for interest or principal payments on the class
A3(G) notes under the priority of payments, when available funds
are insufficient.  S&P's rating on the class A3(G) notes is on a
standalone basis (i.e., S&P gives no credit to this guarantee).

                      RECOVERY RATE ANALYSIS

At each liability rating level, S&P assumed a weighted-average
recovery rate (WARR) by considering the asset type
(secured/unsecured), its seniority (first lien/second lien), and
the country recovery grouping.  S&P also factored in the actual
recoveries from the historical defaulted assets, to derive its
recovery rate assumptions to be applied in its cash flow
analysis.

As a result of this analysis, S&P's WARR assumption in a 'AA'
scenario was 20.23%.  The recovery rates at more junior rating
levels were higher (in line with S&P's criteria).

                         CASH FLOW ANALYSIS

S&P subjected the capital structure to various cash flow
scenarios, incorporating different default patterns, recovery
timings, and interest rate curves to generate the minimum break-
even default rate (BDR) for each rated tranche in the capital
structure.  The BDR is the maximum level of gross defaults that a
tranche can withstand and still fully repay the noteholders,
given the assets and structure's characteristics.  S&P then
compared these BDRs with the SDRs outlined above.

                         COUNTERPARTY RISK

The transaction features an interest rate swap.  Banco Popular
Espanol, S.A. (BB/Negative/B) is the swap counterparty.  Under
S&P's 2012 counterparty criteria, it has defined it as a
"derivative" counterparty.  S&P has reviewed the swap
counterparty's downgrade provisions, and, in its opinion, they do
not fully comply with its 2012 counterparty criteria.  Therefore,
when S&P conducted its scenario analysis at ratings above 'BB',
it analyzed the transaction's cash flow without giving benefit to
the counterparty.

S&P has observed that the portfolio contains a wide range of
spreads.  S&P considers that there is a risk that, should
defaults affect the highest-paying loans more than others, the
pool's yield would tend to decrease over time.  This could limit
the transaction's ability to service the rated notes.  Therefore,
S&P has applied a yield compression stress in its cash flow
analysis when giving no benefit to the counterparty.

Based on S&P's cash flow analysis, it has lowered to 'A (sf)'
from 'A+ (sf)' its rating on the class B notes and to 'BBB (sf)'
from 'BBB+ (sf)' its rating on the class C notes.

The results of S&P's credit and cash flow analysis show that the
credit enhancement available to the D notes is commensurate with
its current ratings.  S&P has therefore affirmed its 'B (sf)'
rating on the class D notes.

S&P's rating on the class E notes reflects the timely payment of
interest and ultimate payment of principal.  S&P lowered its
rating on this class of notes to 'D (sf)' on July 29, 2009, as
interest was not paid on this class.  The class E notes are still
deferring interest.  S&P has therefore affirmed its 'D sf)'
rating on the class E notes.

IM GRUPO BANCO POPULAR FTPYME II is a cash flow CLO transaction
that securitizes loans to SMEs.  The collateral pool comprises
both secured and unsecured loans.  The transaction closed in July
2007.

Note: S&P has corrected an article from March 23, 2009, "Ratings
Lowered On Class B, C, And D Notes In IM Grupo Banco Popular
FTPYME II," that erroneously referred to the class B rating as
'A-', when in fact the rating at the time was 'A+'.  Articles
subsequent to 2009 that referred to that rating were correct.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class              Rating
            To                From

IM GRUPO BANCO POPULAR FTPYME, Fondo de Titulizacion de Activos
EUR2.039 Billion Floating-Rate Notes

Ratings Lowered

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

Ratings Affirmed

A3(G)       AA- (sf)
D           B (sf)
E           D (sf)


SANTANDER HIPOTECARIO 1: Moody's Cuts Rating on D Notes to 'Ba2'
----------------------------------------------------------------
Moody's Investors Service downgraded the ratings of four junior
notes in two Spanish residential mortgage-backed securities
(RMBS) transactions: Caja Ingenieros TDA 1, FTA and FTA Santander
Hipotecario 1. At the same time, Moody's confirmed the ratings of
Caja Ingenieros AyT 2, FTA tranche B and FTA Santander
Hipotecario 8 tranche A. Insufficiency of credit enhancement to
address sovereign risk has prompted the downgrade action.

The rating action concludes the review of five notes placed on
review on July 2, 2012, following Moody's downgrade of Spanish
government bond ratings to Baa3 from A3 on June 2012.

Ratings Rationale:

The rating action primarily reflects the insufficiency of credit
enhancement to address sovereign risk. Moody's confirmed the
rating of two securities whose credit enhancement and structural
features provided enough protection against sovereign and
counterparty risk.

The determination of the applicable credit enhancement driving
these rating actions reflects the introduction of additional
factors in Moody's analysis to better measure the impact of
sovereign risk on structured finance transactions.

Additional Factors Better Reflect Increased Sovereign Risk

Moody's has supplemented its analysis to determine the loss
distribution of securitized portfolios with two additional
factors, the maximum achievable rating in a given country (the
local currency country risk ceiling) and the applicable portfolio
credit enhancement for this rating. With the introduction of
these additional factors, Moody's intends to better reflect
increased sovereign risk in its quantitative analysis, in
particular for mezzanine and junior tranches.

The Spanish country ceiling, and therefore the maximum rating
that Moody's will assign to a domestic Spanish issuer including
structured finance transactions backed by Spanish receivables, is
A3. Moody's Individual Loan Analysis Credit Enhancement (MILAN
CE) represents the required credit enhancement under the senior
tranche for it to achieve the country ceiling. By lowering the
maximum achievable rating for a given MILAN, the revised
methodology alters the loss distribution curve and implies an
increased probability of high loss scenarios.

Moody's has not revised the expected loss assumption for Caja
Ingenieros TDA 1, Caja Ingenieros AyT 2 and FTA Santander
Hipotecario 8. Expected loss assumptions as a percentage of
original pool balance remain at 1.5% for Caja Ingenieros TDA 1;
2.35% for Caja Ingenieros AyT 2 and 10% for FTA Santander
Hipotecario 8. Expected loss assumption has been increased from
0.63% to 0.7% for FTA Santander Hipotecario 1. Moody's has not
revised the Milan CE assumption for any of the deals. The MILAN
CE assumptions remain at 15% for Caja Ingenieros AyT 2; 12% for
Caja Ingenieros TDA 1; 12.5% for FTA Santander Hipotecario 1 and
30% for FTA Santander Hipotecario 8.

Exposure to Counterparty Risk

For Caja Ingenieros TDA 1 and Caja Ingenieros AyT 2 the
conclusion of Moody's rating review takes into consideration the
exposure to Caja Ingenieros which acts as Servicer and collection
account bank in both transactions. Treasury Accounts are held by
Barclays Bank PLC for both deals. The exposure to the collection
account bank does not have a negative impact on the ratings of
the notes.

For FTA Santander Hipotecario 1 and FTA Santander Hipotecario 8
Banco Santander (Baa2/P-2), acts as Servicer and collection
account bank in the two transactions. Treasury Accounts are held
by Banco Santander UK in the case of FTA Santander Hipotecario 1
and Banco Santander Spain S.A. in the case of FTA Santander
Hipotecario 8. The exposure to collection account bank and, in
the case of FTA Santander Hipotecario 8, to Treasury Account
Bank, does not have a negative impact on the ratings of the
notes.

As part of its analysis Moody's also assessed the exposure to
Banco Santander (Baa2/P-2) as swap counterparty for FTA Santander
Hipotecario 1 and 8. The revised ratings of the notes, are not
negatively affected by this exposure.

Other Developments May Negatively Affect the Notes

In consideration of Moody's new adjustments, any further
sovereign downgrade would negatively affect structured finance
ratings through the application of the country ceiling or maximum
achievable rating, as well as potentially increased portfolio
credit enhancement requirements for a given rating.

As the euro area crisis continues, the ratings of structured
finance notes remain exposed to the uncertainties of credit
conditions in the general economy. The deteriorating
creditworthiness of euro area sovereigns as well as the weakening
credit profile of the global banking sector could further
negatively affect the ratings of the notes.

Moody's describes additional factors that may affect the ratings
in "Approach to Assessing Linkage to Swap Counterparties in
Structured Finance Cashflow Transactions: Request for Comment".

The methodologies used in these ratings were Moody's Approach to
Rating RMBS Using the MILAN Framework, published in March 2013,
and The Temporary Use of Cash in Structured Finance Transactions:
Eligible Investment and Bank Guidelines published in March 2013.

In reviewing these transactions, Moody's used its cash flow
model, ABSROM, to determine the loss for each tranche. The cash
flow model evaluates all default scenarios that are then weighted
considering the probabilities of the lognormal distribution
assumed for the portfolio default rate. In each default scenario,
Moody's calculates the corresponding loss for each class of notes
given the incoming cash flows from the assets and the outgoing
payments to third parties and note holders. Therefore, the
expected loss for each tranche is the sum product of (1) the
probability of occurrence of each default scenario and (2) the
loss derived from the cash flow model in each default scenario
for each tranche.

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

In the context of the rating review, the transactions have been
remodeled and some inputs have been adjusted to reflect the new
approach. In addition, the following have been corrected during
the review: Class B margin, two of the triggers switching the
priority of payments and one of the triggers for reserve fund
amortization were corrected for Caja Ingenieros AyT 2; reserve
fund amortization level, three of the triggers switching the
priority of payments and one of the triggers for reserve fund
amortization were corrected for Caja Ingenieros TDA 1 and the
interest deferral trigger value was corrected for FTA Santander
Hipotecario 8.

The List Of Affected Ratings

Issuer: Caja Ingenieros TDA 1, FTA

EUR5.4M B Notes, Downgraded to Baa2 (sf); previously on Nov 23,
2012 Confirmed at A3 (sf)

EUR5.4M C Notes, Downgraded to Ba1 (sf); previously on Jul 2,
2012 Baa3 (sf) Placed Under Review for Possible Downgrade

Issuer: Caja Ingenieros AyT 2, FTA

EUR67.5M B Notes, Confirmed at B1 (sf); previously on Jul 2, 2012
B1 (sf) Placed Under Review for Possible Downgrade

Issuer: Santander Hipotecario 1 FTA

EUR46.9M C Notes, Downgraded to Baa1 (sf); previously on Jul 2,
2012 Downgraded to A3 (sf) and Placed Under Review for Possible
Downgrade

EUR56.3M D Notes, Downgraded to Ba2 (sf); previously on Jul 2,
2012 Baa3 (sf) Placed Under Review for Possible Downgrade

Issuer: FTA SANTANDER HIPOTECARIO 8

EUR640M A Notes, Confirmed at A3 (sf); previously on Jul 2, 2012
Downgraded to A3 (sf) and Remained On Review for Possible
Downgrade



===========
T U R K E Y
===========


BANK AUDI: Fitch Affirms 'B' Long-term Issuer Default Rating
------------------------------------------------------------
Fitch Ratings has affirmed Bank Audi S.A.L.'s Long-term Issuer
Default Rating (IDR) at 'B' with a Stable Outlook. The Viability
Rating (VR) has been affirmed at 'b'.

RATING DRIVERS - IDRs and VR:

Audi's Long-Term IDR is driven by its intrinsic strength
expressed by its VR. The IDRs and VR reflect the strong
correlation between sovereign and bank risks due to the bank's
substantial exposure to the Lebanese sovereign through its large
holding of government debt, as well as the difficult local and
regional operating environment. The ratings also reflect Audi's
strong franchise, competent management, and relatively sound loan
quality, despite the regional unrest, its resilient
profitability, and strong deposit franchise.

RATING SENSITIVITIES - IDRs and VR

The ratings are closely correlated with Lebanon's ratings, and
are sensitive to economic and political developments, both within
Lebanon and in the wider region. A prolonged weakening of the
operating environment, especially if it materially affected
depositor confidence, significant deterioration in asset quality
or substantially reduced profitability could result in downward
rating pressure.

In addition, there are also potential risks associated with
Audi's rapid expansion in new markets. While Fitch views the
expansion positively, and we expect Audi to be able to handle the
risks of expansion, these could -- if expansion is too rapid or
not sufficiently well managed -- result in weakening
capitalization and asset quality and therefore negative pressure
on the ratings.

RATING DRIVERS - SUPPORT RATING AND SUPPORT RATING FLOOR

Fitch considers that the Lebanese authorities would have a high
propensity to support Audi if necessary, in view of its systemic
importance to the banking sector and to the economy as a whole.
However, given the low sovereign rating ('B'), the sovereign's
ability to provide support, although possible, cannot be relied
on; the Support Rating Floor of 'CCC' indicates the potential
difficulty the authorities might have if system-wide support for
the banking sector, including Bank Audi, were required.

RATING SENSITIVITIES - SUPPORT RATING AND SUPPORT RATING FLOOR

The ratings are sensitive to any change in the sovereign's
ratings, as they are closely correlated to the sovereign's
ability to provide support.

Audi is a market-leading bank in Lebanon, the largest by assets,
accounting for about 16% of Lebanese commercial banking assets at
end-2012. Audi offers a full range of commercial and corporate
banking, retail banking, private banking and investment banking
products and services. The bank also offers a range of services
such as on-line brokerage and asset management, through various
subsidiaries.

Audi is one of the most international of the Lebanese banks. It
has operations in seven countries in the Middle East and Africa
region (MENA) including Egypt, Jordan, Syria, Sudan, Saudi
Arabia, Qatar and a representative office in the UAE. Audi also
operates in France, focusing on trade finance and mainly
targeting companies with a Middle Eastern connection. It has a
private banking operation in Switzerland, which controls an asset
management company in Monaco. Audi's most recent venture is in
Turkey via its subsidiary, Odeabank A.S. Audi began operating in
Turkey in 2012, the first foreign bank to obtain a licence there
in over 14 years. The Turkish subsidiary has grown so rapidly -
in a short period - it is now Audi's largest foreign operation,
accounting for about 13% of consolidated assets.

The rating actions are:

-- Long-term IDR affirmed at 'B'; Stable Outlook
-- Short-term IDR affirmed at 'B'
-- Viability Rating affirmed at 'b'
-- Support Rating affirmed at '5'
-- Support Rating Floor affirmed at 'CCC'



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


FORDGATE COMMERCIAL: S&P Lowers Rating on Class B Notes to 'B+'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on Fordgate Commercial
Securitisation No. 1 PLC's class A and B notes.

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

On Dec. 6, 2012, S&P placed on CreditWatch negative its ratings
on the class A and B notes following the update to its European
CMBS criteria.

                           THE FOX LOAN

The loan was initially secured by 22 properties, one of which has
been sold.  The properties are located in eight English regions
and Scotland, with the largest concentration by value being in
Scotland (five properties accounting for 37% of the portfolio
value).  This is followed by Yorkshire and Humberside (five
properties accounting for 17% of the portfolio value), the
northeast (two properties accounting for 15% of the portfolio
value), and Greater London (one property accounting for 12% of
the portfolio value).

The loan is secured against industrial, leisure, office, retail,
and motor showroom use properties.  Offices comprise the largest
part of the portfolio (11 buildings accounting for approximately
75% of the portfolio value).  Leisure premises account for 10% of
the portfolio value.

The overall occupancy rate is approximately 75%, down from 97% at
closing.  This is mainly due to a single distribution unit, which
became vacant shortly after closing and has not been occupied
since.  Since then, occupancy has remained fairly stable.

The borrower continues to actively manage the portfolio.  There
are 116 tenants, of which the top 10 account for 68% of the total
rental income.

The loan is current and financial ratios remain relatively
stable. The current interest coverage ratio is 1.50x, down from
1.78x at closing, while the reported senior loan-to-value ratio
is 54.69%.

At the last valuation in 2006, the underlying property portfolio
was worth GBP478.9 million.  Following considerable property
market declines, S&P considers that this value is likely to have
decreased since this date.

                        RATING RATIONALE

Following S&P's review of the loan and the application of its
criteria, its analysis indicates that the available credit
enhancement for the class A notes is no longer sufficient to
maintain its current rating.  Therefore, S&P has lowered to 'BB+
(sf)' from 'BBB- (sf)' and removed from CreditWatch negative its
rating on the class A notes.

S&P's analysis indicates that the expected recoveries under its
'BB' and 'BB-' rating scenarios are no longer sufficient to cover
principal due on the class B notes.  Therefore, S&P has lowered
to 'B+ (sf)' from 'BB (sf)' and removed from CreditWatch negative
its rating on the class B notes.

Fordgate Commercial Securitization No. 1 is a secured single-loan
transaction.  The loan is backed by a granular pool of 21 U.K.
properties and is scheduled to mature in October 2013.  The notes
are scheduled to mature in October 2016.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class         Rating

         To              From

Ratings Lowered and Removed From CreditWatch Negative

Fordgate Commercial Securitisation No. 1 PLC
GBP264.302 Million Commercial Mortgage-Backed Floating-Rate Notes

A        BB+ (sf)        BBB- (sf)/Watch Neg
B        B+ (sf)         BB (sf)/Watch Neg


INDUS PL:C: S&P Downgrades Rating on Class C Notes to 'B'
---------------------------------------------------------
Standard & Poor's Ratings Services took various credit rating
actions on Indus (ECLIPSE 2007-1) PLC's notes.

Specifically, S&P has:

   -- Affirmed and removed from CreditWatch negative its 'A (sf)'
      rating on the class A notes;

   -- Lowered to 'BB+ (sf)' from 'BBB- (sf)' and removed from
      CreditWatch negative its rating on the class B notes;

   -- Lowered to 'B (sf)' from 'BB- (sf)' and removed from
      CreditWatch negative its rating on the class C notes; and

   -- Affirmed its 'D (sf)' ratings on the class D and E notes.

The rating actions follows S&P's review of the credit quality of
the remaining underlying loans under its updated criteria for
rating European commercial mortgage-backed securities (CMBS)
transactions.

On Dec. 6, 2012, S&P placed its ratings on the class A, B, and C
notes on CreditWatch negative, following an update to its
criteria for rating European CMBS transactions.

                CRITERION LOAN (43.0% OF THE POOL)

The Criterion loan, which matures in July 2015, is the largest
loan in the pool.  The securitized loan has an outstanding
balance of GBP122 million (87% of the whole loan).  There is
additional debt of GBP19 million from this loan, which does not
form part of this transaction.

The loan is secured on a multilet mixed-use property in London,
the Criterion Building, on Piccadilly Circus.  The property
consists of three buildings: Jermyn Street (offices and retail),
The Verity Building (restaurant and theatre) and The Blomfield
Building (Lillywhites).

The property is multilet, with the top five tenants accounting
for 97% of the income and the largest tenant accounting for 58%
of the income.  The occupancy rate has remained at 100% since
closing and the weighted-average unexpired lease term to break
option is 16 years (until first break).

In January 2013, the servicer reported a securitized loan-to-
value (LTV) ratio of 84.2%, based on a July 2012 valuation, and a
securitized interest coverage ratio (ICR) of 1.73x.

               NOS 2 AND NOS 3 LOAN (24.4% OF THE POOL)

This is the second-largest loan in the pool and has a securitized
balance of GBP69.2 million, which matures on Jan. 16, 2017.

The loan is secured on a portfolio of 226 U.K. properties (down
from 244 at closing).  The portfolio, which is highly granular
(both geographically and in terms of the number of tenants)
comprises mainly secondary retail units.

The properties are currently 81% occupied with a weighted-average
lease term of four years and two months until lease break.

In January 2013, the servicer reported a securitized LTV ratio of
60%, based on a November 2010 valuation, and a securitized ICR of
1.78x.

            WORKSPACE PORTFOLIO LOAN (9.4% OF THE POOL)

The loan has a securitized loan balance of GBP26.6 million.  The
borrower failed to fully repay all amounts outstanding by the
Jan. 15, 2013 loan maturity date, and the loan is currently in
special servicing.

This loan is secured against a portfolio of eight managed U.K.
workspace properties, with 46% by market value in the East
Midlands.  Individually, the properties comprise a mix of
warehouses, light industrial, and offices built between 1990 and
2006.

The portfolio is multilet.  The occupancy rate has dropped to
almost 48% from 90% at closing.  The weighted-average unexpired
lease term to first break for the entire portfolio is 2.75 years.

In January 2013, the servicer reported a securitized LTV ratio of
189%, based on a January 2012 valuation, and a securitized ICR of
0.14x.

               REMAINING LOANS (23.2% OF THE POOL)

The six remaining loans account for about 23.2% of the remaining
loan pool.  Eighteen mixed-use (predominantly commercial) U.K.
properties secure the loans.

                          RATING ACTIONS

S&P's ratings on Indus (ECLIPSE 2007-1)'s notes address timely
payment of interest and repayment of principal not later than the
January 2020 legal final maturity date.

S&P's analysis indicates that the available credit enhancement
for the class A notes remains adequate to absorb the calculated
losses in a 'A' stress scenario.  S&P has therefore affirmed and
removed from CreditWatch negative its 'A (sf)' rating on the
class A notes.

In S&P's opinion, the available credit enhancement for the class
B and C notes is insufficient to absorb the calculated losses at
their currently assigned rating levels.  S&P has therefore
lowered to 'BB+ (sf)' from 'BBB- (sf)' its rating on the class B
notes and have lowered to 'B (sf)' from 'BB- (sf)' its rating on
the class C notes.  At the same time, S&P has removed its ratings
on both classes of notes from CreditWatch negative.

The class D and E notes have experienced losses from a previous
loan in the loan pool (Agora Max).  S&P has therefore affirmed
its 'D (sf)' ratings on the class D and E notes.

Indus (ECLIPSE 2007-1) is a true sale transaction that closed in
April 2007, which was initially backed by a pool of 19 loans
secured on 327 commercial and 39 U.K. residential properties.
Ten of the loans have repaid since closing.  The nine outstanding
loans are secured on 253 commercial properties.  The outstanding
notes' balance has decreased to GBP287.0 million from
GBP894.5 million at closing.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class             Rating

            To            From

Indus (ECLIPSE 2007-1) PLC
GBP894.53 Million Commercial Mortgage-Backed Floating-Rate Notes

Rating Affirmed and Removed From CreditWatch Negative

A           A (sf)        A (sf)/Watch Neg

Ratings Lowered and Removed From CreditWatch Negative

B           BB+ (sf)      BBB- (sf)/Watch Neg
C           B (sf)        BB- (sf)/Watch Neg

Ratings Affirmed

D           D (sf)
E           D (sf)


MOWAT: Cash-Flow Problems Prompt Administration
-----------------------------------------------
Greig Cameron at Herald Scotland reports that Mowat Technical and
Design Services has been put into administration after suffering
cash-flow problems.

According to Herald Scotland, MTDS is said to have invested
heavily in research and development in recent years.

All 26 staff are being retained while administrators from RSM
Tenon attempt to find a buyer, Herald Scotland discloses.

The administrators said the most recent turnover at MTDS was
around GBP2 million, Herald Scotland notes.

Abbreviated accounts filed at Companies House for the 12 months
to August 31, 2011, show a retained profit of more than
GBP40,000, Herald Scotland says.

Shareholders' funds were at GBP481,686 with net assets of
GBP809,387, Herald Scotland states.

Iain Fraser, partner at RSM Tenon, appealed for parties
interested in buying MTDS to get in touch as quickly as possible,
Herald Scotland relates.

Mowat Technical and Design Services was founded in 1997 and
designs, commissions, fabricates and installs components for the
oil and gas, nuclear and renewable energy industries.


NORD ANGLIA: S&P Affirms 'B' Long-Term Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it has affirmed its
'B' long-term corporate credit rating on education services
provider Nord Anglia Education (UK) Holdings PLC (Nord Anglia
Education UK) and its parent, Cayman Islands-based Nord Anglia
Education Inc.  The outlook on both companies is stable.

At the same time, S&P affirmed its 'B' rating on Nord Anglia
Education UK's US$325 million senior secured notes with a
recovery rating of '4' and S&P's 'CCC+' rating on the parent's
$150 million payment-in-kind notes with a recovery rating of '6'.

The affirmation reflects S&P's opinion that Nord Anglia
Education's acquisition of WCL Group Limited (WCL) will be
broadly neutral to its creditworthiness.  While interest cover
ratios will likely remain relatively unchanged, the use of debt
and debt-like instruments will increase the group's already high
Standard & Poor's-adjusted debt leverage.  However, S&P thinks
this is mitigated by an improved geographical diversification of
the company's school portfolio.  WCL operates a total of 11 K-12
British curriculum schools, six of which are located in the U.S.,
where Nord Anglia Education is currently not present.  Pro forma
the acquisition, S&P forecasts adjusted EBITDA interest cover of
1.1x (equivalent to about 1.7x when excluding the noncash
interest element from Nord Anglia Education Inc.'s preference
shares) and fully adjusted debt to EBITDA of about 10x by the
fiscal year ending Aug. 31, 2013.  S&P notes that adjusted EBITDA
cash interest cover could be as high as 2.1x if the company chose
to pay in kind the coupon on the US$150 million payment-in-kind
(PIK) toggle notes.

S&P expects the acquisition will be funded with US$114 million
from a one-year US$125 million bridge loan, which will rank pari
passu with the company's existing 10.25% senior secured notes due
April 2017.  If after one year the bridge loan has not been
repaid in full, it will automatically convert into a term loan
due on the maturity date of the senior secured notes.

The US$133 million of preference shares will be issued by Nord
Anglia Education and are identical to the existing preference
shares, accruing at a rate of 12% annually.  This will increase
the total amount outstanding to about US$383 million.  At the
same time, Nord Anglia Education will repay a HSBC facility of
US$11.1 million raised in December 2012.

S&P forecasts Nord Anglia Education's reported EBITDA margin to
remain in excess of 25% under S&P's base-case scenario, partly
stemming from the company's ability to raise tuition fees at a
rate higher than inflation.  Furthermore, S&P continues to expect
that Nord Anglia Education will be able to sustain positive free
operating cash flow (FOCF) generation, even in a less benign
economic environment.

The stable outlook reflects S&P's opinion that Nord Anglia
Education will successfully integrate WCL and continue to
generate positive organic top-line growth and a reported EBITDA
margin in excess of 25%.

S&P might lower the ratings if further large and aggressively
priced mergers and acquisitions transactions or unexpected
operating setbacks caused earnings to decline to the extent that
FOCF generation turned negative or led to a capital structure
that S&P deems to be unsustainable.  A positive rating action
would depend on sustainable deleveraging to less than 6x on a
fully adjusted basis, and the company's ability to consistently
generate positive discretionary cash flow.


SOUTHERN PACIFIC: S&P Affirms 'B' Rating on Class E Notes
---------------------------------------------------------
Standard & Poor's Ratings Services affirmed its credit ratings on
all classes of notes issued by Southern Pacific Financing 04-A
PLC (SPF 04-A), Southern Pacific Financing 05-B PLC (SPF 05-B),
and Southern Pacific Financing 06-A PLC (SPF 06-A).

The rating actions follow its credit and cash flow analysis of
the transaction information that it has received (dated December
2012).  S&P's analysis reflects the application of its U.K.
residential mortgage-backed securities (RMBS) and its 2012
counterparty criteria.

In the December 2012 investor report, Acenden (the servicer),
updated how arrears are reported, to include amounts outstanding,
delinquencies, and other amounts owed.  Other amounts owed
includes, among others, arrears of fees, charges, costs, ground
rent, and insurance.  Delinquencies are principal and interest
arrears on the mortgage loans, based on the borrowers' monthly
instalments.  Amounts outstanding are principal and interest
arrears after payments by borrowers are first allocated to other
amounts owed.  This difference in the allocation of payments for
the transaction and the borrower results in amounts outstanding
being greater than delinquencies.  Following FSA Policy Statement
10/9, Acenden is no longer able to enforce on a mortgage loan if
a borrower is only in arrears of other amounts owed.  However,
borrowers remain liable for these amounts, which must be repaid,
at the latest, at loan redemption.  Both amounts outstanding and
delinquencies have increased recently, but delinquencies have
increased at a slower rate than amounts outstanding.  In S&P's
analysis, it has considered the level of amounts outstanding as
the level of arrears in the portfolios.

In each of the transactions, S&P has been advised that Acenden
reference the level of amounts outstanding for the 90+ days
arrears triggers.  These triggers have been breached in all three
transactions, which, since those breaches, continue the
sequential payment of principal.  S&P has observed that amounts
outstanding are rising and sequential payment of principal is
therefore continuing.  As amounts outstanding are continuing to
rise, S&P therefore expects sequential payment of principal to
continue.

The reserve funds in SPF 05-B and SPF 06-A remain fully funded at
their target amounts.  However, SPF 04-A has suffered small draws
on its reserve fund for 11 quarters.  These draws were due to the
low pool factor, combined with large senior fees (including a
nonamortizing liquidity facility, which currently has a standby
drawing), and an increasing weighted-average cost of funds.  As a
result of these drawings, SPF 04-A's reserve fund is currently at
95.59% of its required amount.

The increased arrears have led to a higher weighted-average
foreclosure frequency (WAFF) compared with S&P's June, 6 2012
review.  Below are the WAFF and weighted-average loss severity
(WALS) that S&P has used in its analysis.

SPF 04-A
Rating     WAFF     WALS
level       (%)      (%)

AAA       50.67    25.67
AA        43.63    21.20
A         35.69    13.49
BBB       30.38     9.46
BB        23.97     6.83
B         20.69     4.59

SPF 05-B
Rating     WAFF     WALS
level       (%)      (%)

AAA       49.25    33.39
AA        42.56    29.10
A         34.83    21.21
BBB       29.19    16.96
BB        22.89    14.02
B         19.75    11.36

SPF 06-A
Rating     WAFF     WALS
level       (%)      (%)

AAA       50.19    32.01
AA        44.10    27.76
A         36.71    20.04
BBB       30.78    15.92
BB        24.68    13.06
B         21.64    10.52

The transactions have deleveraged, with current pool factors (the
percentage of the pool's outstanding aggregate principal balance)
of 7.44%, 20.00%, and 24.22%, in SPF 04-A, SPF 05-B, and SPF 06-
A, respectively.  This increase in available credit enhancement
for the notes, due to the deleveraging, has been sufficient to
offset the increase in S&P's WAFF assumptions since its last
review. Therefore, S&P has affirmed its ratings on all classes of
notes in these three transactions.

The maximum potential rating in these three transactions is
capped at the long-term issuer credit rating on Barclays Bank PLC
(A+/Negative/A-1) as the guaranteed investment contract (GIC)
account provider.

S&P's credit stability analysis indicates that the maximum
projected deterioration that it would expect at each rating level
for time horizons of one year and three years under moderate
stress conditions is in line with its credit stability criteria.

SPF 04-A, SPF 05-B, and SPF 06-A are U.K. nonconforming RMBS
transactions originated by Southern Pacific Mortgage Ltd.

          STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

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

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

            http://standardandpoorsdisclosure-17g7.com

RATINGS LIST

Class       Rating

Ratings Affirmed

Southern Pacific Financing 04-A PLC
GBP350 Million Mortgage-Backed Floating-Rate Notes

A           A+ (sf)
B           A+ (sf)
C           A+ (sf)
D           A- (sf)
E           B (sf)

Southern Pacific Financing 05-B PLC
GBP480 Million Mortgage-Backed Floating-Rate Notes

A           A+ (sf)
B           A+ (sf)
C           A (sf)
D           BB- (sf)
E           B- (sf)

Southern Pacific Financing 06-A PLC
GBP423.36 Million Mortgage-Backed Floating-Rate Notes Plus An
Over-Issuance Of
Mortgage-Backed Floating-Rate Notes

A           A+ (sf)
B           A (sf)
C           BBB- (sf)
D1          B (sf)
E           B- (sf)



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


* Money Market Reforms to Open Doors for New Liquidity Products
---------------------------------------------------------------
Changes in the money market industry will continue, as regulatory
developments coupled with market dynamics force some money market
funds (MMFs) to close or consolidate, says Moody's Investors
Service in its latest special comment "Money Market Funds and
Regulatory Reform: A Business Model Hangs in the Balance."

"Low interest rates, constrained asset supply, regulatory
scrutiny and evolving investor preferences have already begun to
transform the characteristics of money market funds," said Yaron
Ernst, Managing Director of Moody's Managed Investments Group.

Proposed regulatory reforms in the US and Europe that threaten
the traditional constant net asset value (CNAV) structure are one
of the three key drivers of the changing MMF landscape, says
Moody's. MMFs are also faced with persistently low interest rates
that continue to push investors to higher-yielding fund products,
further reducing already-slim profits. In addition, the
diminishing supply of highly rated investments are forcing
managers to develop and launch new products, as the industry
changes shape and business models follow suit, says the rating
agency.

The report lays out three scenarios for the industry, as well as
the expected implications for fund managers and investors:

(A) Variable net asset value (VNAV) MMFs entirely replace CNAV
MMFs -- there is a regulatory prohibition on the CNAV product
generally. The probability of this scenario is low in the US and
in Europe;

(B) Bifurcation of MMFs -- Only government/treasury MMFs are
allowed to maintain their CNAV structure, while prime and tax-
exempt MMFs can only be VNAV. In Moody's view, this scenario is
the most likely in the US, but does not apply in Europe because a
separate framework for government funds does not exist;

(C) Buffers/Holdbacks - Requirement for capital buffers and/or
redemption limits for all CNAV MMFs. This is the most likely
scenario in Europe, with moderate probability of implementation
in the US.

"Due to the changing product dynamics," concluded Ernst, "we
expect industry consolidation to accelerate, combined with a
significant impact on the overall liquidity product landscape and
investor preferences."


* Fitch: European Investors Say Worst of Euro Crisis Not Yet Over
-----------------------------------------------------------------
The majority of European investors believe buoyant financial
markets do not reflect underlying weaknesses in the eurozone,
according to Fitch Ratings' quarterly investor survey.

The doubters are in two camps: 29% who feel that this is a short-
lived period of market calm; and 30% who said markets are
irrationally exuberant, ignoring the weak economic outlook for
Europe. The remaining 41% of survey respondents think the worst
of the crisis is over due to strong support from the ECB and
policy makers.

There is a stark dichotomy between the continuing recession with
rising unemployment across Europe and the rally in financial
markets, in Fitch's view. If the latter is not validated by
economic stabilization and progress towards banking union, the
danger is that market volatility will return with a vengeance
over the summer, as it did in 2012 and 2011.

In the survey, concern for the economy was also evident in
investors' views on recession and inflation risk. Eighty-six
percent said a prolonged recession poses a high risk to the
European credit markets, up from 69% in the last survey and an
all-time high. In a further indication of the low confidence in
economic recovery, the survey respondents regarded inflation as
unlikely, with only 9% of respondents ranking it as a high risk
while more than three times as many (29%) regard deflation as a
high risk.

Fitch conducted the Q213 survey between April 3 and May 7. It
represents the views of managers of an estimated EUR8.6trn of
fixed-income assets.  Fitch will publish the full survey results
in mid-May.


                            *********

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

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

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

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


                            *********


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

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., 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
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Nina Novak at
202-241-8200.


                 * * * End of Transmission * * *