TCREUR_Public/130628.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

             Friday, June 28, 2013, Vol. 14, No. 127

                            Headlines



A U S T R I A

ALPINE BAU: Austria Unveils New Stimulus Following Insolvency


C Y P R U S

* CYPRUS: Says EU/IMF Bailout Provisions Need Tweaking


F R A N C E

ALCATEL-LUCENT: Moody's Rates Proposed Convertible Notes (P)Caa1


G E R M A N Y

FRANZ HANIEL: Moody's Affirms 'Ba2' CFR; Outlook Positive


G R E E C E

INTRALOT: Moody's Assigns '(P)B1' Corporate Family Rating


I R E L A N D

TALISMAN 1: Fitch Affirms & Withdraws 'D' Rating on Class G Notes
TALISMAN-6 FINANCE: Fitch Cuts Ratings on Two Note Classes to 'C'
* IRELAND: Business Insolvencies Down 17%, Vision-net Says


I T A L Y

BERICA 6: Moody's Cuts Rating on EUR8.565MM D Notes to 'Caa2'


K A Z A K H S T A N

CENTRAL-ASIAN ELECTRIC: Fitch Assigns 'BB-' Long-Term IDRs


L U X E M B O U R G

BANQUE INTERNATIONALE: Fitch Affirms 'CCC' Sub. Securities Rating


P O R T U G A L

* Moody's Notes Weakness in Portuguese RMBS Deals for April


S P A I N

BANCO FINANCIERO: Fitch Withdraws 'C' Upper Tier 2 Debt Rating
EDT FTPYME: S&P Lowers Rating on Class C Notes to 'CCC-'
LA SEDA: Shareholders Reject Debt Refinancing Plan
LIBERBANK SA: Fitch Keeps 'BB+' IDRs on Rating Watch Negative


U N I T E D   K I N G D O M

HEATHROW FUNDING: Fitch Affirms 'BB+' High-Yield Bond Ratings
LYNN BAR: Future Secured By Deal, Saves 25 Jobs
SPIRIT OF ENNISKILLEN: High Court Appoints Liquidator
STICHTING PROFILE: Fitch Affirms 'B' Rating on Class E Notes
WARNER ESTATE: Tristan Capital Buys Bouverie Place Retail Complex


X X X X X X X X

* Moody's Says Outlook on Global Oil and Gas Sector Stable
* BOOK REVIEW: Legal Aspects of Health Care Reimbursement


                            *********



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A U S T R I A
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ALPINE BAU: Austria Unveils New Stimulus Following Insolvency
-------------------------------------------------------------
Boris Groendahl at Bloomberg News reports that Austria committed
to increase spending by as much as EUR1.6 billion (US$2.1
billion) until 2016 for construction projects after Alpine Bau
GmbH filed for the country's biggest post-World War II insolvency
and put 5,000 jobs at risk in an election year.

According to Bloomberg, Chancellor Werner Faymann said that the
measures decided in the weekly government meeting in Vienna on
Tuesday include both new projects and bringing forward planned
ones to this year and next year.

Mr. Faymann, as cited by Bloomberg, said he still plans to
balance the budget by 2016.

Alpine Bau filed a EUR2.6 billion insolvency last week, caused
mostly by losses in eastern European projects, Bloomberg
recounts.  The company, owned by Spain's Fomento de
Construcciones y Contratas SA, will be liquidated after funds
were found to be insufficient for a restructuring and neither FCC
nor creditors were ready to provide liquidity, Bloomberg
discloses.

Bloomberg relates that Mr. Faymann said the stimulus measures
include subsidies for social-housing projects, care facilities
for children and the elderly, tunnels, road and rail projects as
well as repairwork for flood damage and flood-protection
measures.

Alpine Bau GmbH operates as a general contractor in Austria and
internationally.  The company focuses on project development
phase to planning and implementation and on to financing and
operation.



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C Y P R U S
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* CYPRUS: Says EU/IMF Bailout Provisions Need Tweaking
------------------------------------------------------
Michele Kambas at Reuters reports that Cyprus said on Tuesday it
was not trying to wriggle out of terms of an EU/IMF bailout
imposed on the island, but said some provisions of the deal
needed tweaking to address problems in its battered banking
sector.

"Every effort will be applied so our positions are met with
understanding by our partners . . . We are not seeking re-
negotiation but an adjustment of certain measures," Reuters
quotes Cypriot President Nicos Anastasiades as saying.

The euro zone island nation was forced to shut one bank and seize
deposits in a second to qualify for EUR10 billion in aid from the
International Monetary Fund, European Central Bank and European
Union in a bailout in March, Reuters recounts.

The bailout was widely considered to have been poorly managed,
with financial markets surprised by losses imposed on depositors
and stirred up by contradictory statements beforehand, Reuters
discloses.

Mr. Anastasiades, who has criticized the bailout as being ill-
conceived, said he would use an EU leaders' meeting this week to
voice his concerns, Reuters notes.

According to Reuters, he did not go into specifics but said what
he would seek was related to solving problems in the island's
banking sector.

In a letter to European leaders in early June, Mr. Anastasiades
urged lenders to provide a long-term and sustainable solution to
liquidity issues faced by Bank of Cyprus, a bank which absorbed
assets from wound-down Laiki Bank, Reuters recounts.

Under terms of the bailout deal, Bank of Cyprus assumed a EUR9.5
billion legacy liability from Laiki, which had been withdrawing
emergency liquidity assistance from the European Central Bank,
Reuters discloses.



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F R A N C E
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ALCATEL-LUCENT: Moody's Rates Proposed Convertible Notes (P)Caa1
----------------------------------------------------------------
Moody's Investors Service assigned a provisional (P)Caa1 rating
to the proposed convertible notes to be issued by Alcatel-Lucent.
Concurrently, Moody's has converted the provisional (P)B1 rating
of the senior secured term loans raised by Alcatel-Lucent USA
Inc. into a definitive B1 rating. Moody's has also affirmed
Alcatel-Lucent's B3 corporate family rating (CFR) and B3-PD
probability of default rating (PDR). The outlook on all ratings
remains negative.

Moody's issues provisional ratings for debt instruments in
advance of the final sale of securities or conclusion of credit
agreements. Upon a conclusive review of the final documentation,
Moody's will endeavor to assign a definitive rating to the rated
capital instruments. A definitive rating may differ from a
provisional rating.

"Our rating assignments reflect the junior position of the
convertible notes in Alcatel-Lucent's capital structure," says
Roberto Pozzi, a Moody's Vice President - Senior Analyst and lead
analyst for Alcatel-Lucent. "Our affirmation of Alcatel-Lucent's
B3 rating reflects the continued pressure on revenues and prices
as well as negative cash flow challenges balanced by the
company's strong relations with its customers, broad product
offering and continued cost reduction efforts.

"While there are benefits to the group's recently announced
refocus on IP Networking and Ultra Broadband, additional
restructuring efforts could delay Alcatel-Lucent's target to
generate positive free cash flows," adds Mr. Pozzi.

Ratings Rationale:

- Assignment off (P)Caa1 Rating To Convertible Notes

The assignment of a (P)Caa1 rating to the proposed convertible
notes to be issued by Alcatel-Lucent reflects (1) their unsecured
nature and hence their junior position in the capital structure
behind the senior secured debt raised by Alcatel-Lucent USA; and
(2) the fact that they have similar features as the existing 5%
convertible notes due in 2015 issued by the same entity, which
Moody's rates Caa1, i.e., they rank pari passu with Alcatel-
Lucent's existing unsecured indebtedness but do not benefit from
upstream guarantees. The (P)Caa1 rating is one notch below the
group's CFR. The issuance of the new convertible notes will
improve Alcatel-Lucent's liquidity by extending its debt
maturities.

In addition, Alcatel-Lucent announced a new strategic plan on
June 19, 2013 that, in essence, will reposition the company's
focus predominantly on its IP Networking and Ultra Broadband
activities, and, to a lesser extent, on its Access activities,
including Wireless Access, Fixed Access, Licensing and Managed
Services, in which Alcatel-Lucent will limit investments and
research and development spending for its legacy products with a
view to achieve positive cash flows by 2015. Given the high
research and development intensity of all of these businesses and
due to the limited availability of capital to support their
growth, this shift in the group's strategy makes sense. However,
these measures will lead to additional restructuring costs, and
an expectation that it will take even longer than previously
anticipated to achieve positive free cash flow generation. In
addition, ALU will continue to develop its Long Term Evolution
(LTE) business, which is the growth portion of its Wireless
division, and will reduce its efforts in the legacy 2G and 3G
networks. Therefore, Moody's believes that, despite the slight
change in strategy, profitability and cash flow generation
ability will be muted going forward, and that the rating remains
adequately positioned in the B3 category.

Moody's rates the senior secured debt issued by Alcatel-Lucent
USA in January 2013 at B1. This rating reflects (1) the priority
position of the loans within the capital structure of the
Alcatel-Lucent group; (2) the benefits of the security,
consisting predominantly of part of Alcatel-Lucent's intellectual
property portfolio, and (3) a guarantee package provided by the
key holding companies and operating companies of the group. This
guarantee, initially represented at least 43% of consolidated
sales for the first nine months of 2012 and 159% of consolidated
EBITDA and 53% of consolidated assets as per the 12-month period
ended September 30, 2012.

The senior unsecured debt issued by Alcatel-Lucent, a holding
company, is rated Caa1, one notch below the group's CFR, which
reflects its ranking behind senior secured creditors and trade
creditors as well as the absence of upstream guarantees with the
exception of the 6.375% bonds due April 2014. Alcatel-Lucent
USA's upstream guarantees for Alcatel-Lucent's 6.375% bonds due
April 2014 do not, in Moody's view, materially enhance the credit
of the affected bonds over senior debt, because of the
subordinated nature of the guarantees and the lack of financial
information on the guarantor.

The guaranteed senior unsecured notes raised by Lucent
Technologies (now Alcatel-Lucent USA Inc.) are rated Caa2. Lucent
Technology's 2.875% senior convertible bonds due in 2023 (EUR76
million outstanding) and 2025 (ca. EUR1 million outstanding)
benefit from the full and unconditional subordinated guarantees
of Alcatel-Lucent. Moody's has maintained the Loss-Given-Default
(LGD) ranking of these bonds in line with other senior debt of
Alcatel-Lucent USA, but have overwritten the LGD score to a Caa2
rating, because the intrinsic credit of the issuer cannot be
ascertained and the only formal recourse for bondholders to
Alcatel-Lucent is a claim subordinated to the senior debt of the
parent company.

Moody's does not rate the legacy bonds issued by Lucent
Technologies, which are not guaranteed by Alcatel-Lucent given
the lack of financial information on the issuing entity.

- Affirmation Of B3 CFR

The affirmation of Alcatel-Lucent's B3 CFR continues to reflect
(1) the pressure on revenues stemming from the generally subdued
investment behavior of the telecom carriers in some of the
developed markets; (2) the price pressure on equipment caused by
major competitors' efforts to increase their market share, which
absorbs a part of the company's cost-saving benefits; and (3)
challenges faced by the company to contain cash consumption,
given the approximately EUR882 million of cash it consumed in
2012 (Moody's adjusted), seasonal cash flow patterns, challenges
to improve working capital, and EUR1.2 billion in debt maturities
until year-end 2015 post refinancing in May and June 2013.

These credit negatives, however, are balanced by (1) Alcatel-
Lucent's strong customer relationships and the large installed
base supporting its market shares; (2) its broad and advanced
product offering, which is complemented by services that make the
company relevant for key customers in the convergence of various
communication technologies amid modest revenue growth for
carriers; (3) the company's strategy of continuing to reduce
expenses and realizing cash by streamlining its product
portfolio, reducing corporate cost and managing working capital;
and (4) a solid liquidity position with a moderately leveraged
capital structure on a net-of-cash basis, which is further
supported by the additional EUR2.0 billion in senior secured
credit facilities raised in January 2013.

The negative outlook on Alcatel-Lucent's rating reflects the
company's ongoing cash burn relative to its substantial, but
finite, liquidity. Given continuing costs for its restructuring
programme and the limited visibility of a recovery in 2013,
Moody's believes that it will be challenging for Alcatel-Lucent
to halt its cash consumption.

What Could Change The Rating Up/Down

Negative pressure on the B3 rating would increase if (1) the
company's operating margin, as adjusted by Alcatel-Lucent, fails
to trend towards the mid-single digits in percentage terms in
2013, with further tangible improvements thereafter; (2) Alcatel-
Lucent is unable to maintain its negative free cash flow below
EUR500 million on a last 12-months-basis throughout 2013, as
adjusted by Moody's; (3) the company's debt/EBITDA does not
improve towards 6.0x as adjusted by Moody's; or (4) the company
is unable to maintain adequate liquidity. Rating pressure could
ease and the outlook on the rating stabilize if all of the
conditions are met, with particular regard to an improvement in
free cash flow generation.

Although currently unlikely, upward rating pressure would require
Alcatel-Lucent to (1) generate significant positive free cash
flow on a last-12-months basis, as adjusted by Moody's; (2)
sustain sales growth; and (3) achieve an operating margin, as
adjusted by Alcatel-Lucent, in the mid-single digits in
percentage terms.

The principal methodology used in these ratings was the Global
Communications Equipment Industry published in June 2008. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

Alcatel-Lucent is a leading developer and manufacturer of telecom
equipment with sales of approximately EUR14.4 billion in 2012. In
terms of revenues, the company ranks behind Cisco Systems, Inc.
(A1 stable), with $47.3 billion (EUR36.7 billion) of revenues in
the 12-month period to January 2013, Telefonaktiebolaget LM
Ericsson (A3 negative), with SEK228 billion (EUR26.2 billion) of
sales (2012), and Huawei, with CNY220 billion (EUR27.2 billion)
of sales in 2012, but before Nokia Siemens Networks B.V. (B2
positive), with sales of EUR13.4 billion in 2012. In spite of
this relative high concentration of global vendors, price
competition is very fierce in this industry.



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G E R M A N Y
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FRANZ HANIEL: Moody's Affirms 'Ba2' CFR; Outlook Positive
---------------------------------------------------------
Moody's Investors Services has changed the outlook for Franz
Haniel & Cie. GmbH to positive from stable. Concurrently, the Ba2
corporate family, the Ba2-PD Probability of Default Rating and
senior unsecured ratings have been affirmed at Ba2.

Ratings Rationale:

The rating action follows a material improvement in Haniel's
portfolio valuation over the course of the last several months in
combination with significant recent debt repayments made by the
Company.

Haniel's loan to value leverage, as adjusted by Moody's, has
decreased from over 50% towards around 40%, which corresponds to
around 33% on an as reported basis. The improvement was
facilitated by both increases in share prices and, more
importantly, significant debt repayments which reduced the debt
at the holding from EUR2.4 billion to EUR1.9 billion. Haniel's
reduction of stakes in Metro and Celesio (ownership reduced by 4%
and 5% respectively) as well as recently announced plans to
reduce its ownership in Takkt from 70% to 50%, are evidence of a
much more proactive approach of the new CEO in addressing
Haniel's high leverage. Even though cash interest cover remains
relatively weak (i.e. around 1.0x), the position is partly
mitigated by the fact that no dividend was paid to Haniel's
shareholders in 2013.

Haniel's rating is still benefitting from a strong liquidity
profile with around EUR1500 million of undrawn lines available.
The nearest and largest maturity of third party debt relates to
the outstanding balance of the EUR 472 million bond due in
October 2014. The remaining maturity profile of other bonds
extends into 2017/18 and provides significant timing flexibility
to withstand short-term volatility in asset prices.

The positive outlook reflects the increasing likelihood that,
barring a material decline in valuation, Haniel should continue
to reduce the loan-to-value ratio below 40% over the next 6-12
months and therefore should be within the triggers set for a
possible upgrade, especially if further debt reduction measures
were to get implemented. An upgrade would also require visibility
for a cash cover being sustainably at or above 1.0x.

Negative pressure could be exerted on the rating in the event of
a deterioration of market leverage metrics towards/above 60%,
and/or failing to maintain strong liquidity buffer via timely
extension of maturing bilateral banking facilities. Continued
negative cash cover would also put negative pressure on the
rating.

The principal methodology used in these ratings was the Global
Investment Holding Companies published in October 2007. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

Based in Duisburg, Germany, Franz Haniel & Cie. GmbH is a large
family-owned investment company, with diversified industrial
interests, which generated consolidated sales of EUR 26.3 billion
in the year to December 2012.



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INTRALOT: Moody's Assigns '(P)B1' Corporate Family Rating
---------------------------------------------------------
Moody's assigned a provisional (P)B1 Corporate Family Rating
(CFR) to Intralot S.A. on June 17, 2013. The assignment of the
provisional rating indicates that this rating is subject to the
successful placement of EUR300 million notes announced by the
company at that time. Proceeds from the bond would be earmarked
to repay Intralot's outstanding convertible bond maturing in
December 2013 and to repay part of the bank debt maturing in
December 2014. Adverse market conditions last week prevented
Intralot from issuing its proposed notes as planned.

Should Intralot not be able to successfully issue the notes
within a reasonable timeframe to refinance the debt, Moody's
points to the fact that the company's liquidity position could
deteriorate rapidly given the sizeable amounts of debt maturing
within the next quarters, and if no alternative financing is put
in place. In this case, under Moody's stress scenario, Intralot's
cash sources would be insufficient to cover its cash uses within
a few quarters. This would lead to immediate rating pressure on
Intralot's ratings.

Headquartered in Athens, Greece, Intralot is a leading vendor in
the gaming sector and at the same time a licensed gaming operator
through 28 individual licenses across 16 jurisdictions. Intralot
designs, develops, operates and supports custom-made gaming
solutions and provides innovative content, services and
technology to lottery and gaming organizations on a global scale
with presence across 55 jurisdictions in 36 countries worldwide.
In fiscal year 2012 Intralot generated revenues of approximately
EUR1.37 billion and reported an EBITDA of EUR178 million.



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TALISMAN 1: Fitch Affirms & Withdraws 'D' Rating on Class G Notes
-----------------------------------------------------------------
Fitch Ratings has affirmed and withdrawn Talisman 1 Finance plc's
Class G commercial mortgage-backed floating-rate notes, as
follows:

-- EUR1.1m Class G (XS0220380363): affirmed at 'Dsf';
   Recovery Estimate 'RE0%', withdrawn

The withdrawal of the rating reflects the lack of information
provided to Fitch and the limited public interest in the rating.

The 'Dsf' rating and RE0% Recovery Estimate on the class G notes
reflect the uncertainty posed to investors by claims lodged by
the Prime loan B note lenders for reimbursement of costs of
EUR0.5 million plus legal costs. The dispute has reportedly been
resolved between the servicer and the issuer, but on terms that
have not been disclosed to Fitch. In any event, Fitch believes
that senior fees would likely consume any funds flowing to the
issuer.


TALISMAN-6 FINANCE: Fitch Cuts Ratings on Two Note Classes to 'C'
-----------------------------------------------------------------
Fitch Ratings has downgraded Talisman-6 Finance plc's class A to
E notes and affirmed class F as follows:

EUR615.4m class A (XS0294187306) downgraded to 'Bsf' from
'BBBsf'; Outlook Negative

EUR79.9m class B (XS0294187991) downgraded to 'CCCsf' from
'BBsf'; Recovery Estimate (RE) 50%

EUR83.3m class C (XS0294188882) downgraded to 'CCsf' from 'Bsf';
RE 0%

EUR59.9m class D (XS0294189005) downgraded to 'Csf' from 'CCsf';
RE 0%

EUR12.5m class E (XS0294189427) downgraded to 'Csf' from 'CCsf';
RE 0%

EUR15.5m class F (XS0294189690) affirmed at 'Csf'; RE 0%

KEY RATING DRIVERS:

The key rating driver for the downgrade of the classes A to E
notes is the declining performance of the loans, all of which are
in default. Fitch is especially concerned about the largest loan,
the EUR360.4 million Orange loan, which makes up 42% of the pool.
The loan defaulted at its July 2012 maturity, following a prior
one-year extension, and the borrower is now also subject to an
insolvency process. Little progress had been made in disposing of
collateral, and so there is increasing concern about the timing
of recoveries needed by legal final maturity (LFM) in October
2016.

In addition to the uncertainty surrounding court-administered
insolvency, the issuer is subject to a claim for "equitable
subordination" brought by rival creditors. While the courts have
yet to rule on this matter, this opens up a risk that the
issuer's claims against the Orange loan collateral face
potentially severe dilution. More generally, since (as Fitch
understands it) parties affiliated to the sponsor count among the
various creditors within the insolvency process, there is greater
risk of the borrower recording success in delaying enforcement or
extracting concessions.

The large number of assets (235) securing the remaining six loans
(excluding the Cherry loan) represents a real challenge to the
special servicer in its bid to maximize recoveries by LFM.
Furthermore, with a short weighted average lease term and patchy
property quality, market values are likely to slide further over
time, accentuating the urgency of resolving these loans. While
Fitch has incorporated the likelihood of discounts on asset sales
in its analysis, the Negative Outlook indicates the possibility
of further negative rating action in case the special servicer
cannot hasten liquidation.

The multifamily housing portfolio securing the EUR59.3 million
Cherry loan was sold in October 2012, realizing EUR18.8 million
of net sales proceeds allocated to the senior notes. The
remaining EUR40.2 million loan balance (plus unpaid interest
accrued in the meantime) is expected to be fully written off,
which would in turn result in a write-off of classes E and F
notes, and a partial write-down of the class D notes.

Rating Sensitivities

Evidence of the rate of recovery dragging below Fitch's
expectations, measured both in terms of market value decline and
timeliness, would likely trigger further downgrades of the
classes A, B and C notes. Moreover, an unfavorable court ruling
for the Orange loan could also lead to severe downgrades and low
Recovery Estimates.


* IRELAND: Business Insolvencies Down 17%, Vision-net Says
----------------------------------------------------------
According to Business & Leadership, business and credit risk
analyst Vision-net said that so far this year, 182 companies in
Ireland have been declared insolvent, which is 17% lower than the
same period last year.

Of the 812 insolvent companies, 559 were liquidated, 243 entered
receivership, and an examiner was appointed to 10, Business &
Leadership discloses.

Dublin accounted for most insolvencies (41%), followed by Cork
with 12%, and Kildare with 5%, Business & Leadership says.

The professional services sector accounted for 18% of
insolvencies so far this year, followed by construction with
17pc, wholesale and retail with 14%, real estate with 13%, and
manufacturing with 10%, Business & Leadership notes.



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BERICA 6: Moody's Cuts Rating on EUR8.565MM D Notes to 'Caa2'
-------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of one
senior and three junior notes, confirmed the ratings of three
senior and one junior notes and upgraded the rating of one junior
note in four Italian residential mortgage-backed securities
(RMBS) transactions: Berica 6 Residential MBS S.r.l., Berica 8
Residential MBS, S.r.l., F-E Mortgages S.r.l. and F-E Mortgages
S.r.l. 2005. Insufficiency of credit enhancement to address
sovereign risk and counterparty exposure prompted the downgrades.

The rating action concludes all reviews of affected notes placed
on review for downgrade either due to insufficient credit
enhancement to address sovereign risk and set-off exposure or due
to counterparty exposure. In the course of the review process
Moody's introduced new and updated approaches to analyses better
sovereign risk on structured finance transactions.

Ratings Rationale:

These rating downgrades primarily reflect the insufficiency of
credit enhancement to address sovereign risk and counterparty
exposure. Moody's confirmed and upgraded 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 that
drives 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 Italian country ceiling, and therefore the maximum rating
that Moody's will assign to a domestic Italian issuer including
structured finance transactions backed by Italian receivables, is
A2. 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 reassessed the collateral performance and portfolio
characteristics based on available loan-by-loan information of
the four transactions. As a result, Moody's has maintained its
current lifetime expected loss (EL) and MILAN CE assumptions.
Moody's EL assumptions remain at 3.0% in F-E Mortgages S.r.l., at
3.4% in F-E Mortgages S.r.l. 2005, at 6.1% in Berica 6
Residential MBS S.r.l. and at 4.4% in Berica 8 Residential MBS
S.r.l.. Moody's MILAN CE assumptions remain at 8.5% in F-E
Mortgages S.r.l. and F-E Mortgages S.r.l. 2005, at 14.7% in
Berica 6 Residential MBS S.r.l. and 15.3% in Berica 8 Residential
MBS S.r.l..

- Exposure to Counterparty

The downgrade of the senior notes in Berica 6 Residential MBS
S.r.l. reflects as well the impact of the commingling exposure to
Deutsche Bank SpA acting as issuer account bank. Moody's has
assessed the probability and effect of a default of Deutsche Bank
SpA on the ability of the issuer to meet their obligations under
the transactions. The exposure to Deutsche Bank SpA is factored
in the downgrade of these notes. In Berica 8 Residential MBS
S.r.l. the counterparty exposure to Deutsche Bank SpA acting as
issuer account bank was mitigated by sufficient credit
enhancement in line with the current rating.

- 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 increase 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.

The methodologies used in these ratings were Moody's Approach to
Rating RMBS Using the MILAN Framework published in May 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.

List Of Affected Ratings:

Issuer: Berica 6 Residential MBS S.r.l.

EUR1185M A2 Notes, Downgraded to Baa1 (sf); previously on Mar 13,
2013 A2 (sf) Placed Under Review for Possible Downgrade

EUR42.8M B Notes, Downgraded to Ba2 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible
Downgrade

EUR28.6M C Notes, Downgraded to B3 (sf); previously on Aug 2,
2012 Baa3 (sf) Placed Under Review for Possible Downgrade

EUR8.565M D Notes, Downgraded to Caa2 (sf); previously on Jun 11,
2012 B3 (sf) Placed Under Review for Possible Downgrade

Issuer: Berica 8 Residential MBS S.r.l.

EUR1220.05M A Certificate, Confirmed at A2 (sf); previously on
Mar 22, 2013 A2 (sf) Placed Under Review for Possible Downgrade

Issuer: F-E Mortgages S.r.l.

EUR48M B Notes, Confirmed at A2 (sf); previously on Aug 2, 2012
Downgraded to A2 (sf) and Placed Under Review for Possible
Downgrade

EUR11M C Notes, Confirmed at Baa2 (sf); previously on Aug 2, 2012
Baa2 (sf) Placed Under Review for Possible Downgrade

Issuer: F-E Mortgages S.r.l. 2005

EUR41.1M B Notes, Confirmed at A2 (sf); previously on Mar 13,
2013 A2 (sf) Placed Under Review for Possible Downgrade

EUR36M C Notes, Upgraded to Baa2 (sf); previously on Nov 27, 2012
Downgraded to Ba1 (sf) and Remained On Review for Possible
Downgrade



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


CENTRAL-ASIAN ELECTRIC: Fitch Assigns 'BB-' Long-Term IDRs
----------------------------------------------------------
Fitch Ratings has assigned Kazakhstan-based integrated energy
company JSC Central-Asian Electric Power Corporation (CAEPCo)
Long-term foreign and local currency Issuer Default Ratings
(IDRs) of 'BB-', Short-term foreign currency IDR of 'B' and a
National Long-term Rating of 'BBB+(kaz)'. The Outlooks on the
Long-term IDRs and National Rating are Stable.

The ratings reflect CAEPCo's vertical integration, relatively
benign regulatory regime, access to cheap coal and good regional
market position, despite its overall small size. However,
CAEPCo's ageing assets require significant renewal and the
planned investment program could result in persistent negative
free cash flow and elevated funds from operations (FFO) adjusted
leverage levels of around 3x through 2017 based on Fitch's rating
case forecast.

KEY RATING DRIVERS

Large Capex Program
CAEPCo's substantial capex program over the next five years will
likely result in negative free cash flow over the same period,
and require a significant degree of debt funding given likely
continued dividend payments. This will likely result in a
sustained increase in FFO adjusted leverage to around 3x from
2.2x at FY12. The capex program is aimed at modernizing over 50%
of CAEPCo's ageing 1960s and 1970s generation capacity by 2015,
as well as upgrading its distribution network. Capacity expansion
will be moderate at around 15% in total to 2015 but additional
benefits will be reduced losses and increased fuel efficiency.

Increasing Tariffs
Revenue and EBITDA growth are reliant on increasing generation
tariffs. Escalating tariff caps have been set in each of CAEPCo's
operating regions up until 2015, based on inflation and CAEPCo's
planned capex program. Actual tariffs achieved can be slightly
higher or lower than these caps, but importantly, the tariff
trend is still strongly upwards each year. Tariffs together with
supportive electricity supply/demand dynamics in Kazakhstan, and
CAEPCo's relatively low cost base should underpin forecast
increased revenue and EBITDA. Post-2015 the tariff regime is
uncertain, particularly for existing capacities. However, we
assume that fuel and other cost inflation will continue to be
reflected in energy prices, possibly with some support for new
capacities through capacity payments.

Some Volume Risk
The level of revenue and EBITDA growth is assisted by the
increasing volume of commercial electricity sales (generated and
purchased) which we forecast to grow in excess of 4% CAGR to 2015
for CAEPCo, in line with expected country-wide electricity demand
growth. However, volume risk and cyclicality, particularly with
directly connected industrial customers, remains an issue for
CAEPCo. We note that there is some customer concentration but
Fitch views counterparty risk as manageable. Although we forecast
CAEPCo will remain short on generation, the potential to export
or sell on the wholesale market, currently at above the tariff
cap, remains an option should the company's net position reverse.

Benefit of Cheap Fuel
Kazakh coal prices are over 80% below international market rates.
The low price reflects the low calorific content and high ash
content of coal used domestically as well as low transport costs.
Additionally, to protect energy affordability, the coal price
charged to utilities is regulated annually and reflected in power
tariff caps. An unexpected and significant increase in the price
of coal above Fitch's current inflationary estimates of 7%-10%
per annum would have a negative impact on EBITDA, although this
is considered unlikely and should be reflected in higher tariffs.

Generation Dominates Despite Integration
CAEPCo's vertical integration gives it access to markets for its
energy output and limits customer concentration. The cash flow
smoothing effect is fairly limited as the non-generation
businesses of distribution and supply represented less than 10%
and 5% of Fitch adjusted EBITDA in 2012, respectively. The heat
distribution business is loss-making due to high heat loss and
regulated end user tariffs, which Fitch assumes are kept low for
social reasons (heat generation is reported within overall
generation and cash flow accretive), a situation that we assume
will persist but with gradual improvement.

No Parent Uplift or Constraint
Unlike most Fitch-rated utilities in CIS, CAEPCo is privately
owned and therefore not impacted by sovereign linkage. The
company is run as a standalone enterprise with two foreign
institutional shareholders and as such we do not assume any
impact on the ratings based on the credit profile of the
controlling parent, Central-Asian Power-Energy Company JSC
(CAPEC). The ratings therefore reflect CAEPCo's standalone credit
profile.

Potential Acquisitions
CAEPCo is likely to continue consolidating the Kazakh electricity
market. Fitch has included in its forecast the potential for some
near-term acquisitions, which could be margin enhancing and
moderately de-leveraging. Non-completion, or completion with
higher debt and capital expenditure requirement than our
forecasts could push CAEPCo towards guidance for negative rating
action.

Dividends to Delay Debt Reduction
CAEPCo's financial policy is to pay dividends and this could
delay de-leveraging in the long term. However, we believe that
should tariffs and volumes underperform CAEPCo retains the
flexibility to lower dividends to preserve cash.

Debt Structure and Liquidity
Fitch views CAEPCo's short term liquidity as adequate supported
by KZT10 billion of cash at FYE12 and circa KZT26 billion of
available facilities, including the facilities recently arranged
with EBRD (AAA/Stable). At FYE12, three-quarters of debt was
long-term and short-term debt was KZT2.5 billion. Fitch expects
negative free cash flow for 2013 given capital expenditure
commitments.

The on-going capital expenditure program will likely require
significant additional debt funding of during the next five
years, given potential continued dividend payments. Of this,
total loans in the amount of KZT21 billion have been entered into
with EBRD in May 2013. CAEPCo has proven access to domestic and
some international lenders, as well as domestic bond market.

At FYE12 circa 15% of total debt was denominated in foreign
currency, mainly USD. The proportion of FX-denominated debt is
likely to increase over the coming years. FX exposure is limited
due to a relatively stable USD:KZT rate since 2008 and due to
Kazakhstan being a significantly dollarized economy. Therefore
the inflationary impact from a devaluation of the KZT would
likely gradually feed into higher electricity tariffs.

All current debt facilities (both secured and unsecured) are
largely at the operating company level. Therefore if unsecured
debt is issued at the CAEPCo (holding) level without guarantees
from the operating companies, especially if secured debt exceeds
2x EBITDA, we may consider such holdco debt as structurally
subordinated, potentially affecting the debt rating.

RATING SENSITIVITIES

Positive: Future developments that could lead to positive rating
actions include:

- Stronger financial profile than forecast by Fitch due to,
   among other things, higher than expected growth in electric
   and heat tariffs and/or generation electricity supporting FFO
   adjusted leverage below 2x and FFO interest coverage above 7x
   on a sustained basis would be positive for the ratings.

- Increase of certainty regarding post 2015 regulatory framework
   could also be supportive of the ratings.

Negative: Future developments that could lead to negative rating
action include:

- A substantially above inflation increase in coal price and/or
   tariffs materially lower than our forecasts, leading to FFO
   adjusted leverage forecast to be persistently higher than 3x
   and FFO interest coverage below 4.5x would be negative for the
   ratings.

- Committing to capex without sufficient available funding,
   worsening overall liquidity position may also be rating
   negative.



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


BANQUE INTERNATIONALE: Fitch Affirms 'CCC' Sub. Securities Rating
-----------------------------------------------------------------
Fitch Ratings has affirmed Banque Internationale a Luxembourg's
(BIL) Long-term IDR and Support Rating Floor at 'A-'. Fitch has
also upgraded BIL's (VR) to 'bbb+' from 'bbb'. The Outlook on the
IDR is Stable.

KEY RATING DRIVERS AND SENSITIVITIES - IDRs, SUPPORT RATING AND
SUPPORT RATING FLOOR

BIL's Long and Short-term IDRs, Support Rating and Support Rating
Floor are driven by an extremely high probability of support from
the state of Luxembourg (AAA/Stable) if required, This view
derives from BIL being a systemically important domestic bank in
Luxembourg and the local authorities' track record of providing
support to such institutions if needed. In addition, the
Luxembourg state holds a 10% stake in the bank. The Short-term
IDR has been affirmed at 'F1', the higher of the two mapping
options which link the Short and Long-term IDRs. This reflects
Fitch's belief that potential support from the Luxembourg state
would be forthcoming.

RATING SENSITIVITIES- IDRs, SUPPORT RATING AND SUPPORT RATING
FLOOR

BIL's IDRs, Support Rating and Support Rating Floor are sensitive
to a decrease in Luxembourg's ability (reflected in its rating)
and/or willingness to support BIL, if needed.

There is a clear political intention within the EU to ultimately
reduce the implicit state support for systemically important
banks, as demonstrated by a series of policy and regulatory
initiatives aimed at curbing systemic risk posed by the banking
industry. This will result in Fitch factoring less support into
banks' IDRs in the medium term. BIL's SRF and, therefore, its
Long-term and Short-term IDRs are highly sensitive to a change in
Fitch's view of the likelihood of authorities in Europe to
provide full support to creditors in their banks. Given that
BIL's VR is at 'bbb+', any downgrade of the SRF (hence IDRs)
would be limited to one notch.

KEY RATING DRIVERS-VR

The upgrade of BIL's VR recognizes the strengthened capital
ratios achieved since the acquisition by Precision Capital (a
Luxembourg-based company investing private Qatari funds) of 90%
of BIL's capital from Dexia. The deal closed in October 2012 and
Fitch understands that the new ownership's strategy will be to
retain an overall moderate risk profile.

BIL has regained most of the market share it lost when it was
part of the Dexia group given the stress experienced by its
parent company. Inflows of customer deposits have strengthened
the bank's already healthy funding profile. This reflects BIL's
good retail and private banking franchise, which provide ample
liquidity to the bank. BIL has streamlined its operations and now
focuses on its core franchises. Its objective is to focus on
activities generating recurring earnings. The upgrade of the VR
incorporates expected improvement in its operating returns. This
should help maintain its solid capital and support business
growth.

BIL's VR reflects a good retail funding base, high liquidity
ratios, solid capital ratios and the expected improvement in
operating profitability that should result from its restructuring
and refocused strategy. The rating also reflects the bank's
geographic concentration in a small and mature, albeit strong,
economy.

RATING SENSITIVITIES - VR
Any significant reduction in the bank's capital ratios and/or
liquidity position would be detrimental for its VR. The bank's
inability to generate higher operating returns or an increased
risk appetite would also lead to negative pressure on its VR.
This is not currently Fitch's base case. Fitch currently sees
limited upside potential for the VR because at its current level,
it already incorporates an expected improvement in profitability
and assumes that other key credit metrics will remain fairly
stable at their current levels.

KEY RATING DRIVERS- SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
BIL's subordinated (Tier 2) debt securities are rated one notch
below its VR to reflect below average loss severity of this type
of debt when compared to average recoveries. This rating has thus
been upgraded due to the upgrade of BIL's VR.

RATING SENSITIVITIES - SUBORDINATED DEBT AND OTHER HYBRID
SECURITIES
The 'CCC' rating of the XS0132253468 subordinated securities
reflects their non-performance under the agency's criteria and
Fitch's view that the instruments are expected to return to
performing status with only moderate economic losses for
investors being sustained once coupon payment resumes. The rating
is therefore sensitive to any weakening of BIL's earnings outlook
that might give rise to the risk of a longer period of non-
performance of the securities.

The securities have contractually been partially written down (by
around 15%) following the large loss reported in 2011 and this
has caused the suspension of (non-cumulative) coupon payment. The
capital of the securities will be fully restored provided the
bank reports enough net profit (and after allocation to reserves)
which was not the case in 2012. Hence, coupons will continue to
be waived in 2012 but should resume in 2013, in Fitch's opinion.

The rating actions are:

Long-term IDR affirmed at 'A-'; Outlook Stable
Short-term IDR affirmed at 'F1'
Support Rating affirmed at '1'
Support Rating Floor affirmed at 'A-'
Viability Rating upgraded to 'bbb+' from 'bbb'
Senior debt affirmed at 'A-/F1'
Market linked notes affirmed at 'A-emr'
Subordinated debt upgraded to 'BBB' from 'BBB-'
XS0132253468 subordinated securities affirmed at 'CCC'



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


* Moody's Notes Weakness in Portuguese RMBS Deals for April
-----------------------------------------------------------
The performance of Moody's-rated Portuguese residential mortgage-
backed securities (RMBS) deals remained weak in the three-month
period to April 2013, according to the latest indices published
by Moody's Investors Service.

Outstanding defaults (360+ days overdue, up to write-off)
increased to 2.10% over the current balance in April 2013, from
1.90% in January 2013. On a year-on-year basis, outstanding
defaults increased 42.11%. In April, 60+ and 90+ day
delinquencies decreased slightly to 1.61% and 1.23%,
respectively, from 1.76% and 1.34% in January. On a year-on-year
basis, 60+ day delinquencies decreased 14.48% and 90+
delinquencies decreased slightly by 0.38%. The prepayment rate
remained stable during the three months up to April at 1.36%,
rising from 1.92% 12 months earlier.

Most Portuguese RMBS transactions benefit from a provisioning
mechanism, whereby excess spread is captured to provide for
future losses on highly delinquent loans, before losses are
actually realized. When excess spread is insufficient for
provisioning the reserve fund is drawn. At the end of April 2013,
the reserve funds in six transactions were below target levels.

Moody's outlook for Portuguese RMBS collateral performance is
negative. Moody's expects that Portuguese GDP will decline 2%
year-on-year in 2013 after declining 3.2% in 2012. Household
borrowers' disposable income will fall as unemployment rises.
Moody's expects that the unemployment rate will end 2013 at 17.9%
up from 15.9% in 2012.

Overall, Moody's has rated 32 Portuguese RMBS transactions since
2001, of which 26 are outstanding, with a total outstanding pool
balance of EUR18.38 billion as of April 2013.



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


BANCO FINANCIERO: Fitch Withdraws 'C' Upper Tier 2 Debt Rating
--------------------------------------------------------------
Fitch Ratings has withdrawn Spain-based Banco Financiero y de
Ahorros, S.A.'s (BFA; BB/Rating Watch Negative (RWN)) preferred
stock and upper Tier 2 debt ratings at 'C', and three dated
subordinated debt issue ratings at 'CC' following completion of
burden sharing. As a result of this exercise, these instruments
no longer exist.

At the same time, Fitch has assigned a 'BB' rating to seven
senior unsecured debt issuances by BFA. These result from the
conversion of subordinated instruments (previously unrated by
Fitch). Fitch has also upgraded four other dated subordinated
debt issues upon their conversion into senior debt, to 'BB' from
'CC'. Simultaneously the agency has placed all of these senior
unsecured debt issuances on RWN. A full list of rating actions is
at the end of this rating action commentary.

The rating actions follow the announcement on May 23, 2013 of the
completion of burden sharing, as stated by the July 2012
Memorandum of Understanding signed between Spain and the rest of
the Eurogroup. Burden sharing, the terms and conditions of which
were approved by the Steering Committee of Spain's Fund for
Orderly Bank Restructuring (FROB) on April 16, 2013, entailed
distressed exchanges of the hybrid securities of BFA and Bankia,
S.A. into shares of Bankia or senior debt instruments of BFA.

KEY RATING DRIVERS
The withdrawal of BFA's preferred stock, upper Tier 2 debt and
some lower Tier 2 debt issues reflects that these instruments
have been extinguished in connection with the distressed debt
exchange.

The upgrade of some of BFA's dated subordinated debt ratings
reflects the conversion of these securities into senior debt
instruments. These debt ratings are aligned with BFA's Long-term
IDR. The RWN is based on Fitch's opinion of potential pressures
on state propensity to support BFA. Some other lower Tier 2
instruments have been withdrawn at 'CC' for the same reasons than
preferred stock and upper Tier 2 debt.

RATING SENSITIVITIES
The ratings on the senior unsecured debt issues are sensitive to
the same factors which may drive changes to BFA's IDRs.

The rating actions are:

Senior unsecured (ES0214959035; EUR6,975,747); assigned 'BB',
placed on RWN

Senior unsecured (ES0214983092; EUR10,231,255); assigned 'BB',
placed on RWN

Senior unsecured (ES0214959043; EUR3,400,898); assigned 'BB',
placed on RWN

Senior unsecured (ES0214950000; EUR26,153,643); assigned 'BB',
placed on RWN

Senior unsecured (ES0214983118; EUR17,105,200); assigned 'BB',
placed on RWN

Senior unsecured (ES0214950067; EUR27,150,000); assigned 'BB',
placed on RWN

Senior unsecured (ES0214959068; EUR410,400); assigned 'BB',
placed on RWN

Senior unsecured upon conversion of subordinated lower Tier 2
(ES0214950125; EUR31,524,000); upgraded to 'BB' from 'CC', placed
on RWN

Senior unsecured upon conversion of subordinated lower Tier 2
(ES0214950216; EUR57,288,000); upgraded to 'BB' from 'CC', placed
on RWN

Senior unsecured upon conversion of subordinated lower Tier 2
(ES0214950166; EUR10,207,600); upgraded to 'BB' from 'CC', placed
on RWN

Senior unsecured upon conversion of subordinated lower Tier 2
(ES0214950141; EUR220,000); upgraded to 'BB' from 'CC', placed on
RWN

Subordinated lower Tier 2 (ES0214977169; ES0214977078;
ES0214950182); 'CC'; withdrawn

Subordinated upper Tier 2 (ES0214977102; XS0205497778): 'C';
withdrawn following conversion into equity

Preferred stock (ES0115373021, ES0113251005, ES0115373005,
XS0214965450, KYG1754W1087): 'C'; withdrawn following conversion
into equity


EDT FTPYME: S&P Lowers Rating on Class C Notes to 'CCC-'
--------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'CCC- (sf)' from
'BB (sf)' its credit rating on EDT FTPYME PASTOR 3, FONDO DE
TITULIZACION DE ACTIVOS' class C notes.  At the same time, S&P
has affirmed its 'AAA (sf)' rating on the class B notes, which
are guaranteed by the European Investment Fund.

The rating actions follows S&P's assessment of the transaction's
performance using the latest available trustee report (dated
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
review of the capital structure in July 2011, the pool has
experienced further defaults and the obligor concentration risk
has increased due to the continued deleveraging of loans.

The underlying pool is highly seasoned with a pool factor (the
percentage of the pool's outstanding aggregate principal balance
compared with the closing date) of 5.46%.  According to the April
2013 trustee report, 12+ months cumulative defaults account for
4.17% of the closing pool balance (compared with 2.43% at S&P's
July 2011 review).  The recovery rates reported on these defaults
are in the range of 10% to 11%.

Even though the minimum required level of the reserve fund is
expected to be EUR16.38 million, the reserve fund was further
depleted since S&P's July 2011 review and is currently
EUR2.9 million.

However, the full amortization of the class A1 and A2(G) notes
and partial amortization of class B notes since S&P's July 2011
review has increased available credit enhancement for the class B
notes.

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 S&P
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 the issuer did not provide with
the internal credit scores upon request.  S&P therefore 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 20%.

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

                      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 'AAA'
scenario was 18.42%.  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.

                        SUPPLEMENTAL TESTS

S&P's rating on the class C notes was constrained by the
application of the largest obligor default test.  Accordingly,
S&P has lowered to 'CCC- (sf)' from 'BB (sf)' S&P's rating on the
class C notes.

                         COUNTERPARTY RISK

The transaction features an interest rate swap.  CECABANK 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.

As the swap counterparty does not fully comply with S&P's 2012
counterparty criteria, it has tested scenarios where it gives no
benefit to the counterparty--applying a yield compression stress
in its cash flow analysis.  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, the
pool's yield would tend to decrease over time.  This could limit
the transaction's ability to service the rated notes.

Following S&P's assessment of the transaction's performance and
the application of its relevant criteria, S&P's cash flow results
indicate that the available credit enhancement for the class B
notes supports a lower rating than currently assigned.

However, the class B notes are guaranteed by the European
Investment Fund (EIF; AAA/Negative/A-1+).  In accordance with
S&P's 2008 guarantee criteria, its rating on this class of notes
is weak-linked to its long-term rating on the EIF.  S&P has
therefore affirmed its 'AAA (sf)' rating on the class B notes.

EDT FTPYME PASTOR 3 is a cash flow CLO transaction that
securitizes loans to SMEs.  The collateral pool comprises both
secured and unsecured loans.  The transaction closed in December
2005.

          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


LA SEDA: Shareholders Reject Debt Refinancing Plan
--------------------------------------------------
Reuters reports that shareholders of La Seda de Barcelona on
Wednesday rejected a debt refinancing plan that would have
allowed the company to withdraw from insolvency proceedings.

The company has been in talks with creditors for months since
high material costs and excess supply of the PET plastic
containers it makes put pressure on its business, Reuters
discloses.

According to Reuters, the company on Tuesday said it had reached
a preliminary deal to refinance 75% of EUR235 million (US$306
million) of syndicated debt with creditors, largely thanks to a
deal with its biggest creditor U.S. hedge fund Anchorage.

But La Seda shareholder BA Pet with an 18% stake said in a
statement on Wednesday that shareholders had rejected Anchorage's
proposal to control the company by taking on 40% of financial
debt at a 60% discount, Reuters relates.

La Seda, as cited by Reuters, said in a stock market filing that
a majority of shareholders rejected a plan to give Anchorage a
stake in the company in exchange for debt.

La Seda had EUR600 million of debt at the end of 2012, according
to company filings, and has EUR462 million in syndicated loans
from banks, according to Reuters loan market news and analysis
service RLPC.

La Seda de Barcelona is a Spanish plastics bottle maker.  The
Catalonia-based company makes bottles in Europe, Turkey and North
Africa.


LIBERBANK SA: Fitch Keeps 'BB+' IDRs on Rating Watch Negative
-------------------------------------------------------------
Fitch Ratings has maintained Banco Mare Nostrum, S.A.'s (BMN),
Liberbank, S.A.'s and Banco Grupo Caja3, S.A.'s (BCaja3) Long-
term Issuer Default Ratings (IDRs) of 'BB+' on Rating Watch
Negative (RWN). Fitch has upgraded BMN's Viability Rating (VR) to
'b+' from 'f', Liberbank's to 'bb-' from 'f' and BCaja3's to 'b+'
from 'f'.

The upgrade of the VRs follows Fitch's review of these banks'
stand-alone creditworthiness after receiving support under the
terms and conditions approved by the European Commission on 20
December 2012. The upgrade of these banks' VR is primarily driven
by the materialization of capital support through the state and
burden sharing on hybrid securities, but also addresses the
benefits on these banks' credit and liquidity profiles of the
transfers of a large proportion of their real estate assets to
Spain's "bad bank" (SAREB). At the upgraded VR levels the ratings
reflect the challenges ahead as these banks implement their
restructuring plans, against a background of weak macro-economic
fundamentals and still thin capitalization.

The RWN on BMN's, Liberbank's and BCaja3's Long-term IDRs,
Support Rating and SRFs reflects Fitch's view of a potential
lowering of the propensity of support for these banks, in part
because there is a clear EU intent to reduce bank support in the
future. Moreover, these banks face downsizing of their
franchises, as committed with the European Commission, which
could result in relatively smaller entities, potentially of lower
systemic importance.

KEY RATING DRIVERS - IDRS AND SENIOR DEBT, SUPPORT RATING AND SRF
BMN, Liberbank and BCaja3's IDRs and senior debt ratings are
driven by their Support Rating Floor (SRF) of 'BB+', reflecting
Fitch's belief that there is a moderate likelihood of state
support. These banks have small national franchises, with deposit
market shares of about 2% for BMN and Liberbank and 1% for
BCaja3, but market shares in their home regions are substantial.
Fitch expects to resolve the RWN on the IDRs within the next
three months and once the agency assesses these banks' relative
systemic importance post recapitalization and restructuring.
Fitch will also consider support-relevant developments at EU
level.

RATING SENSITIVITIES - IDRS AND SENIOR DEBT, SUPPORT RATING AND
SRF
BMN, Liberbank and BCaja3's IDRs will be downgraded if the SRF is
revised downwards. The SRFs of these banks are sensitive to
changes in the perceived propensity of the Spanish government to
provide support as well as to any negative rating action on
Spain's sovereign ratings ('BBB'/Negative). An upgrade of these
banks' IDRs solely driven by their stand-alone financial strength
is unlikely in the near-term given the current level of their
VRs.

For BCaja3, the RWN on its IDRs also highlights the agreement
reached on May 23, 2013 to integrate with Ibercaja Banco, S.A.
(unrated). The merger is pending final approvals, expected for
the end of July 2013. At that point, BCaja3's ratings could be
based on parental support and Fitch may then re-assess its IDRs,
Support Rating and SRF.

KEY RATING DRIVERS - VRs
The upgrade of BMN's, Liberbank's and BCaja3's VRs reflect the
restoration of their capital, albeit at still tight levels in
Fitch's opinion. BMN is 65%-owned by Spain's Fund for Orderly
Bank Restructuring (FROB) after injecting EUR730 million of
capital, adding to EUR915 million of preferred stock granted in
2010 and now converted into equity. The FROB also granted
contingent convertibles (CoCos) of EUR407 million to BCaja3 and
EUR124 million to Liberbank. Other capital strengthening measures
include asset sales and bailing in of subordinated debt and
hybrid debt, which have been particularly important at BMN and
Liberbank.

After completing the recapitalizations, Fitch estimates BMN's,
Liberbank's and BCaja3's pro-forma Fitch eligible capital
(FEC)/weighted risks ratios respectively at 6.4%, 4.8% and 3.3%.
These ratios are weak but are heavily affected by accumulated tax
loss carry-forwards, deducted by Fitch from its calculation of
FEC. If these amounts were not deducted, the pro-forma
FEC/weighted risks ratios would be far higher at 9.8% for BMN,
9.4% for Liberbank and a weaker 6.7% for BCaja3. Capital adequacy
ratios should benefit from de-leveraging, whilst earnings will
remain weak at least until cost savings are not fully phased-in.

These banks' risk profile benefited from transferring real estate
development (RED) exposure to SAREB. At end-Q113, RED exposure
stood at 8% of gross loans and foreclosed assets for BCaja3 and a
smaller 5% for BMN and 3% for Liberbank. The latter also held a
further 14% of gross loans and foreclosures linked to RED, but
within an asset protection scheme (APS) granted in 2010 by the
banks' Deposit Guarantee Scheme for the purchase of Caja de
Ahorros de Castilla-La Mancha. The level of reserves against
Liberbank's APS risks, currently at approximately 51%, is
considered by Fitch to be sufficient in the absence of further
significant stress.

These three banks' impaired loan (NPL) ratios are better than the
system average (excluding the APS for Liberbank). However, loan
loss reserve cover remains on the low side at 32% for BMN, 45%
for Liberbank and 56% for BCaja3. Moreover, Fitch anticipates
that asset quality will remain under pressure, in particular from
unreserved restructured lending, which is larger at BMN and
BCaja3 than at Liberbank. Fitch assesses Liberbank's asset
quality as the strongest of the three banks, partially supporting
the one-notch differential of its VR with that of BMN and BCaja3.

After the receipt of state-guaranteed bonds from SAREB (in
exchange for transferred assets), these banks' stock of liquid
assets, at above 15% of total assets, comfortably meets debt
repayments scheduled for 2013-2015. Loan/retail funding ratios
improved to close to 100% at BMN and Liberbank and 75% at BCaja3,
while reliance on wholesale funding is largely in covered bonds
and ECB LTROs, with the latter needed to support margins.

In Fitch's view, these banks' primary challenge is to protect
their deposit franchises whilst they continue to de-lever as
committed with the European Commission. Another important issue
for these banks is to meet restructuring targets in order to
reduce their cost base and improve their weak underlying
profitability amid an exceptionally low interest rate
environment.

RATING SENSITIVITIES - VRs
BMN's, Liberbank's and BCaja3's VR will be downgraded if Spain's
economic and operating conditions become weaker than currently
anticipated, if these banks fail to show the benefits on
profitability of the restructuring as planned and/or if their
business profile deteriorates further because of lower deposit
levels or a material weakening of asset quality. Conversely, an
upgrade will be driven by asset quality stabilization and
improvements in profitability and capital. For BCaja3, once its
merger into Ibercaja occurs, Fitch is likely to re-assess its
ratings.

SUBSIDIARY AND AFFILIATED COMPANY - KEY RATING DRIVERS AND
SENSITIVITIES
Banco CLM is fully consolidated into the group accounts of
Liberbank. Its IDRs are aligned with those of Liberbank because
Fitch considers Banco CLM to be part of Liberbank's core banking
business in Spain, due to the geographic diversification and
franchise it brings, and it is highly-integrated into the group.
Banco CLM's IDRs are sensitive to the same factors that would
drive a change in Liberbank's IDRs and/or to a change in the
level of importance of Banco CLM within the group, which is seen
by Fitch as very unlikely.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
BMN, Banco CLM and BCaja3's subordinated debt ratings and the
ratings of BMN's preferred stock have been affirmed as they have
been subject to burden-sharing, as established by the July 2012
Memorandum of Understanding and Royal Decree Law 24/2012. BMN and
Banco CLM's burden sharing has already been completed, resulting
in tendered bonds being converted into equity for BMN and CoCos
or equity of Liberbank for Banco CLM. Due to the completion of
burden-sharing, these instruments have been extinguished and
Fitch has therefore withdrawn their ratings.

BCaja3 expects its burden sharing to be completed in mid-July
2013. Once completed, the affected instruments will also be
extinguished and the agency will withdraw their ratings in
accordance with Fitch's criteria for distressed debt exchange.

The rating actions are:

BMN:
Long-term IDR: 'BB+'; RWN maintained
Short-term IDR: affirmed at 'B'
VR: upgraded to 'b+' from 'f'
Support Rating: '3', RWN maintained
SRF: 'BB+', RWN maintained
Commercial Paper Long-term rating: 'BB+', RWN maintained
Commercial Paper Short-term rating: affirmed at 'B'
Senior unsecured debt Long-term rating: 'BB+', RWN maintained
Senior unsecured debt Short-term rating: affirmed at 'B'
Subordinated lower tier 2 debt: affirmed at 'CC'; withdrawn
Preferred stock: affirmed at 'C'; withdrawn
State-guaranteed debt: affirmed at 'BBB'

Liberbank:
Long-term IDR: 'BB+'; RWN maintained
Short-term IDR: affirmed at 'B'
VR: upgraded to 'bb-' from 'f'
Support Rating: '3'; RWN maintained
SRF: 'BB+'; RWN maintained
State-guaranteed debt: affirmed at 'BBB'

Banco CLM:
Long-term IDR: 'BB+'; RWN maintained
Short-term IDR: affirmed at 'B'
Support Rating: '3'; RWN maintained
Senior unsecured debt: 'BB+'; RWN maintained
Subordinated lower tier 2 debt: affirmed at 'CC'; withdrawn
Subordinated upper tier 2 debt: affirmed at 'C' ; withdrawn
BCaja3:
Long-term IDR: 'BB+'; RWN maintained
Short-term IDR: affirmed at 'B'
VR: upgraded to 'b+' from 'f'
Support Rating: '3'; RWN maintained
SRF: 'BB+'; RWN maintained
Subordinated lower tier 2 debt: affirmed at 'CC'



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


HEATHROW FUNDING: Fitch Affirms 'BB+' High-Yield Bond Ratings
-------------------------------------------------------------
Fitch Ratings has affirmed Heathrow Funding Limited's (Heathrow
Funding or the issuer) bonds issued under its debt issuance
programme and Heathrow Finance Plc's (Heathrow Finance or the
HoldCo) high-yield bonds, as follows:

Class A bonds: affirmed at 'A-', Outlook Stable

Class B bonds: affirmed at 'BBB', Outlook Stable

Heathrow Finance high-yield bonds: affirmed at 'BB+', Outlook
Stable

The affirmations reflect Heathrow's (LHR) stable performance and
Fitch's assessment of its ability to service and refinance its
issuer and Holdco debt. They also reflect the different
structural support available to both the issuer's and Holdco's
creditors.

On April 30, 2013, the Civil Aviation Authority (CAA) announced
its initial proposition for the price cap applicable at Heathrow
from April 2014 to March 2018 (next regulatory period, or Q6).
The price cap is based on a weighted average cost of capital
(WACC) of 5.35%, materially lower than the 6.2% in force until
2014 and which Fitch had accounted for Q6 in its previous base
and rating cases. This lower price cap proposal, if confirmed by
year end, would introduce some downside risk, ie risk that
Heathrow cannot achieve the implied assumptions, notably as far
as operating cost efficiencies and cost of debt are concerned.

This downside risk is partly offset by the "starting point"
improved performance. The good commercial and financial
performance achieved by Heathrow in 2012 and early 2013 has built
up some headroom in the rating, as reflected in the affirmation,
as the credit metrics for all tranches of debt remain within
Fitch's credit guidance for the next five years. The somewhat
unfavorable price cap determination is also mitigated by a
materially lower average cost of debt applying to the current
debt stock, due to an active and successful debt management, with
shorter dated GBP3bn bonds raised in 2012 at favorable
conditions.

KEY RATING DRIVERS

Resilient Hub Airport
LHR is a large hub/gateway airport serving a very strong origin
and destination market. LHR's performance through the recent
economic crisis was one of the strongest in the industry, with a
maximum peak-trough fall in traffic of just 3.4%. This is due to
a combination of factors that Fitch considers stable over time:
the attractiveness of London as a world business center; the role
of Heathrow as a hub offering very strong yield for its resident
airlines; the location and connectivity of LHR with the well-off
western and central districts of the city; the capacity
constraint at LHR (with only two runways for +70m pax and a legal
cap on annual aircraft movements), suggesting there is
unsatisfied demand (which first absorbs shocks in demand).

Transparent But Constraining Price-Cap Regulation
Heathrow is subject to economic regulation, with a price cap
calculated under a single till methodology and that neutralizes
inflation (RPI+X). The cap is set for five years by the CAA,
which has a duty to ensure airports' operations and investments
remain financeable. The price cap is established to offset LHR's
(considerable) market power and is highly sensitive to several
building blocks (cost of capital, traffic forecast, operational
efficiency). The regulatory process that leads to the cap
determination is very transparent but creates a material
uncertainty every five years. Price cap settlements can prove
detrimental to the airport, as CAA's assumptions can appear
aggressive ex-post. For example, the traffic forecast for Q5 was
designed before the 2007-2008 crisis and proved overly
optimistic. However, this was partly offset by higher-than
planned inflation. The Civil Aviation Act, adopted in December
2012, updates the CAA's duties and renews the framework for the
economic regulation. It stipulates that a license will be
introduced in Q6. From Fitch's perspective, as currently drafted,
this license would have no material impact.

Well-Controlled Renewal Plan
Heathrow implements a detailed capital improvement plan, agreed
to by the regulator. The plan for the current regulatory period
(2008-2013, or Q5) exceeded GBP5 billion and is now largely
complete, with a good track record in delivering on time and on
budget. The regulated asset base concept allows for the self-
financing of most investments through the tariff. After delivery
of a brand new T2 in 2014, LHR will mostly feature state-of-the
art terminals. The Q6 capex plan is more modest and represents
less of a challenge than Q5. The building of a third runway is
currently ruled out by the government, but may resurface later.

Multi-Layer Debt Structure
The class A debt benefits from its seniority and protective debt
structure (ring-fencing of all cash flows from Heathrow and set
of covenants limiting leverage). It is exposed to some hedging
and refinancing risk, which is mitigated by strong market access
due to an established multi-currency debt platform and the use of
diverse maturities. The class B and Heathrow Finance debt have
weaker debt structures due to the subordination of these
tranches.

Stable Performance Expected
Fitch has reflected a mix of CAA's and Heathrow's assumptions in
its rating case, generally adopting the most prudent of the two.
It has also assumed that the regulator's Q6 determination would
remain as per the initial proposal, that RPI reverts to a 2.5%
trend in the medium term and that Heathrow could face adverse
financing conditions (6.9% all in cost for senior debt) in two of
the next five years. Fitch forecasts that in this scenario, the
company should be able to maintain post-maintenance and tax
interest cover ratios (PMICR) for each class of debt at levels
above Fitch's current rating thresholds - 1.5x-1.6x for a 'A-'
rating of class A debt, 1.2x-1.3x for a 'BBB' rating of class B
debt and 1.1x-1.15x for a 'BB+' rating of BAA (SH) debt.
Furthermore, the average dividend/interest cover ratio at the BAA
(SH) level is also in excess of the 3.0x that Fitch considers
appropriate for a 'BB+' rating at HoldCo level.

RATING SENSITIVITIES

Exposure to Aviation Market
The Stable Outlook reflects the expectation that Heathrow will
continue to post a stable performance, despite weak economic
prospects. A marked and durable degradation of the British
economy could derail Heathrow's good record of resilience.
Evidence of recessionary prospects over a prolonged horizon (two
years) or failure to achieve operational efficiency gains could
prompt a revision of the Outlook to Negative. Net debt/EBITDA
above 8.5x and PMICR below 1.6x for class A would also suggest a
downgrade.

Although Fitch deems this is less likely, a material improvement
in the economic environment could support higher load factors and
use of larger aircrafts by airlines, in turn improving the
passenger throughput at Heathrow with a favourable impact on
credit ratios. Net debt/EBITDA consistently below 7x and average
PMICR above 1.8x for class A would suggest a rating upgrade.

Regulatory Risk
The initial proposal for price determination is unfavourable for
Heathrow but Fitch believes the airport can face it without a
downgrade. However, should the final determination be even lower,
a downgrade could be justified.


LYNN BAR: Future Secured By Deal, Saves 25 Jobs
-----------------------------------------------
Lynn News reports that the future of a Lynn bar has been saved by
a new company after it went into administration, securing the
jobs of 25 members of staff.

Chicago's, the Norfolk Street venue, is now owned by Chicago
Leisure, which has taken ownership of a further eight Chicago's
across the UK, after the previous owner Atmosphere Bars and Clubs
went into administration in May, according to Lynn News.

"We are thrilled to be working with the new owners.  It has saved
the jobs of our team members, as well as ensuring a venue that
has lots of loyal customers continues to thrive. . . . The new
owners plan to invest in the business to ensure we can offer an
even better customer experience going forwards.  We know
customers will be glad to know our Thursday student nights, and
great value weekends will continue as before," the report quoted
Clare Taylor, the manager of Lynn's Chicago's, as saying.


SPIRIT OF ENNISKILLEN: High Court Appoints Liquidator
-----------------------------------------------------
BBC News reports that the High Court has appointed a liquidator
to dispose of all assets held by the Spirit of Enniskillen Trust.

The recession had exposed it to a GBP290,000 pension liability,
BBC discloses.

According to BBC, a judge said it should act as a warning to any
other charities facing insolvency.

In March 2011 the trust's liability was assessed as GBP98,000 --
causing no alarm because it owned its offices at Malone Avenue in
south Belfast, BBC relates.

Purchased for GBP215,000 in 2000, the property's value soared
before the housing crash brought its current estimated worth back
down to GBP180-GBP190,000, according to BBC.

By the time the trust ceased operating and made staff redundant
in March this year, its pension liability was assessed at
GBP289,827, BBC notes.

An application was brought by trustees to have it declared
insolvent and for solicitor John Gordon of Napier and Sons to be
appointed liquidator for the winding-up purposes, BBC states.

Appointing Mr. Gordon and liquidator and trustee with power over
the Malone Avenue property and all other assets, the judge, as
cited by BBC, said the case raised wider questions about the
operation of the Northern Ireland Charities Pension Scheme.

The award-winning trust was established in memory of those killed
and injured in the November 1987 attack on the County Fermanagh
town.


STICHTING PROFILE: Fitch Affirms 'B' Rating on Class E Notes
------------------------------------------------------------
Fitch Ratings has affirmed Stichting Profile Securitisation 1, as
follows:

GBP262m class SS notes affirmed at 'AA+', Outlook Stable
GBP0.8m class A+ notes affirmed at 'AA+', Outlook Stable
GBP17.2m class A notes affirmed at 'A+', Outlook Stable
GBP5.4m class B notes affirmed at 'BBB+', Outlook Stable
GBP3.0m class C notes affirmed at 'BBB', Outlook Stable
GBP3.1m class D notes affirmed at 'BB+', Outlook Stable
GBP3.7m class E notes affirmed at 'B', Outlook Stable

Key Rating Drivers

The affirmation reflects the transaction's stable performance
since the last review in July 2012. Since then the class SS and
A+ notes have each amortized to 76% of their initial balances,
leading to the portfolio being reduced by GBP10 million. As a
result of this natural amortization, credit enhancement has
marginally increased. For the class SS and A+ notes, credit
enhancement has increased to 12.87% from 12.47%.

The portfolio currently comprises 30 loans from 29 obligors to
public private partnerships (PPP), based in the UK. Overall, the
composition of the portfolio has not significantly changed since
the last review. There has been a slight improvement in credit
opinions, with roughly 70% of the assets rated in the 'BBB-*'
category and the remaining assets rated 'BB+*'. However, it is a
highly concentrated portfolio with the top five obligors
presenting 23% of the balance. The main industries in the
transaction are education (47%) and healthcare (39%). All
projects are at an operational stage.

Fitch's estimated recovery rates on the underlying portfolio
range between 75% and 90%. The analysis is based on asset-
specific recovery assumptions with a tiering of 85% (base case)
to 60% ('AAA' stress case). Additionally, the correlation
assumptions for the analysis were based on a relative ranking of
project finance correlations, which are lower than for corporate
debt obligations due to structural features. The pair-wise
correlation for projects within the UK, but from different
sectors is considered to be 7%, whereas the correlation for two
projects in the UK and the same sector, such as healthcare can be
up to 13%.

Rating Sensitivities

Fitch included two additional stresses to test the transaction's
sensitivity to changes in recovery rates, as well as underlying
credit opinions. The first scenario addressed a reduction of
recovery rate assumptions by 25%, while the second scenario
tested the transaction's sensitivity to a downgrade of one notch
throughout the portfolio. Both sensitivity tests suggest that
rating action would be likely if either scenario occurred.


WARNER ESTATE: Tristan Capital Buys Bouverie Place Retail Complex
-----------------------------------------------------------------
PropertyEU reports that a fund advised by pan-European investment
manager Tristan Capital Partners has acquired a 21,000 m2 retail
complex in Folkestone, UK, out of receivership.

The CCP III fund purchased the Bouverie Place shopping center in
a joint venture with UK retail asset manager Ellandi, PropertyEU
relates.

The vendor was the receiver for two subsidiaries of UK real
estate company Warner Estate Holdings, PropertyEU discloses.

According to PropertyEU, the two subsidiaries -- Warner Estate
Development (Folkestone) Ltd. and Warner Investments Ltd. -- were
placed into receivership following the parent company's
refinancing.

No purchase price was disclosed but a report in Property Week
suggested it was in the region of GBP22 million (EUR25.9
million), PropertyEU notes.



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


* Moody's Says Outlook on Global Oil and Gas Sector Stable
----------------------------------------------------------
The outlook for the global integrated oil and gas industry will
remain stable over the next 12-18 months, reflecting the
likelihood of subdued earnings growth during this period, says
Moody's Investors Service in its latest Industry Outlook on the
sector entitled "Global Integrated Oil and Gas Industry Range-
Bound Oil Prices Keep Outlook Stable." The global integrated oil
and gas industry's outlook has been stable since September 2011.

"We expect the net income of the global oil and gas sector to
fall within the stable range of minus 10% to 10% well into 2014
as robust oil prices and a slight pick-up in US natural gas
prices help offset ongoing fragility in the refining segment,"
says Francois Lauras, a Vice President - Senior Credit Officer in
Moody's Corporate Finance Group and author of the report.
"Although oil prices may moderate, we expect demand growth in
Asia and persistent geopolitical risk to keep prices at elevated
levels."

Moody's anticipates that integrated oil companies (IOCs) will
concentrate on reinvesting cash flows into their upstream
activities, driven by robust oil prices, favorable long-term
trends in energy consumption and the prospects of higher returns.
However, major projects are exerting pressure on operating and
capital efficiency measures as they are often complex, highly
capital intensive and have long lead times.

In the near term, Moody's expects that IOCs will continue to
dispose of non-core, peripheral assets to complement operating
cash flows and fund large capital expenditure (capex) programs,
as well as make dividend payouts without impairing their balance
sheets. For example, Shell has divested a large amount of assets
in the past three years, raising total proceeds of $21 billion
during the period. Total also plans to generate $15-20 billion
from assets disposals during 2012-14; and recently indicated that
it anticipated reaching the low-end of its target range by the
end of 2013.

Moody's expects IOCs to remain committed to the Middle East and
North Africa (MENA) region despite ongoing unrest in some
nations, particularly to countries such as Libya and Iraq, where
gradual progress is being made for future development.

In Russia, integrated oil and gas companies' operating profits
are likely to remain stable overall in 2013. Nearly all rated
Russian players remain competitive with global peers in terms of
reserves, production, and particularly on finding and development
(F&D) costs. Nonetheless, the need to develop new reserves in
challenging regions may somewhat diminish the historical cost
advantage they have enjoyed over time.

Moody's could change its outlook to negative if a substantial
drop in oil prices were triggered by a further deterioration in
the world economy. The rating agency would consider changing its
outlook to positive if it expected the sector's net income
increased by more than 10% over the next 12-18 months.


* BOOK REVIEW: Legal Aspects of Health Care Reimbursement
---------------------------------------------------------
Authors:  Robert J. Buchanan, Ph.D., and James D. Minor, J.D.
Publisher: Beard Books
Softcover: 300 pages
List Price: $34.95
Review by Henry Berry

With Legal Aspects of Health Care Reimbursement, Buchanan, a
professor in the School of Public Health at Texas A&M, and Minor,
an attorney, have come up with an invaluable resource for lawyers
and anyone else seeking an introduction to the legal and social
issues related to Medicare and Medicaid.  The administrative
costs of Medicare and Medicaid reimbursement have been a heated
topic of debate among public officials and administrators of
provider healthcare organizations, especially health maintenance
organizations.  Although inflation and the use of costly medical
technology are key factors in the rise in Medicare and Medicaid
costs, some control can be gained through appropriate compliance,
using more efficient procedures and better detection of fraud.
This work is a major guide on how to go about doing this.
Though mostly a legal treatise, Legal Aspects of Health Care
Reimbursement, first published in 1985, also offers commentary
through legislative and regulatory analyses, thereby explaining
how healthcare reimbursement policies affect the solvency and
effectiveness of the Medicare and Medicaid programs.
In discussing how legislation and regulations affect the solvency
and effectiveness of government-provided healthcare, the authors
offer insight into the much-publicized and much-discussed issue
of runaway healthcare costs.  Buchanan and Minor do not deny that
healthcare costs are out of control and are onerous for the
government and ruinous for many individuals.  But healthcare
reimbursement policies are not the cause of this, the authors
argue.  To make their case, they explain how the laws and
regulations in different areas of the Medicare and Medicaid
programs create processes that are largely invisible to the
public, but make the programs difficult to manage financially.
The processes are not well thought out nor subject to much
quality control, with the result that fraud is chronic and
considerable.

The areas of Medicare covered in the book are inpatient hospital
reimbursement, long-term care, hospice care, and end-stage renal
disease.  The areas of Medicaid covered are inpatient hospital
and long-term care plus abortion and family planning services.
For each of these areas, the authors discuss the conditions for
receiving reimbursement, the legislation and regulations
regarding reimbursement, the procedures for being reimbursed, the
major areas of reimbursement (for example, capital-related costs,
dietetic services, rental expenses); and court cases, including
appeals.  Reimbursement practices of selected states are covered.
For each of the major areas of interest, the chapters are
organized in a manner that is similar to that found in reference
books and professional journals for attorneys and accountants.
Laws and regulations are summarized and occasionally quoted with
expert background and commentary supplied by the authors.  With
regard to court cases and rulings pertaining to Medicare and
Medicaid, passages from court papers are quoted, references to
legal records are supplied, and analysis is provided. Though the
text delves into legal issues, it is accessible to administrators
and other lay readers who have an interest in the subject matter.
Clear chapter and subchapter titles, a table of cases following
the text, and a detailed index enable readers to use this work as
a reference.

The value of this book is reflected in the authors' ability to
distill great amounts of data down to one readable text.  It
condenses libraries of government and legal documents into a
single work.  Answers to questions of fundamental importance to
healthcare providers -- those dealing with qualifications,
compliance, reimbursable costs, and appeals -- can be found in
one place. Timely reimbursement depends on proper application of
the rules, which is necessary for a provider's sound financial
standing. But the authors specify other reasons for writing this
book, to wit: "Providers should have a general knowledge of the
law and should not rely on manuals and regulations exclusively."
By summarizing, commenting on, and citing cases relating to
principal provisions of Medicare and Medicaid, the authors
accomplish this objective.

The authors also cover the topic of fraud with respect to both
Medicare and Medicaid, offering both a legal treatment and
commentary.  At the end of each chapter is a section titled
"Outlook," which contains a discussion of government studies,
changes in healthcare policy, or other developments that could
affect reimbursement.  Although this work was published over two
decades ago, much of this discussion is still relevant today.
Finally, the book is a call for change.  The authors remark in
their closing paragraph: "Given the increasing for-profit
orientation of the major segments of the health care industry,
proprietary providers should be particularly responsive to new
efficiency incentives" in reimbursement.  In relation to this,
"policymakers [should] develop reimbursement methods that will
encourage providers to become more efficient."

Robert J. Buchanan is currently a professor in the Department of
Health Policy and Management in the School of Rural Public Health
at the Texas A&M University System Health Sciences Center.  James
D. Minor, a former law professor at the University of
Mississippi, has his own law practice.


                            *********

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.


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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.


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