TCREUR_Public/130919.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Thursday, September 19, 2013, Vol. 14, No. 186



FIRST INVESTMENT: Fitch Affirms 'BB-' LT Issuer Default Rating


BANK OF CYPRUS: Fitch Keeps 'B' Covered Bonds Rating on Watch Neg
* CYPRUS: To Lift Capital Controls in January 2014


TIIMARI OYJ: Files for Bankruptcy Protection on Lack of Funding


FRANZ HANIEL: S&P Raises CCR to 'BB+'; Outlook Stable
FRESENIUS SE: Moody's Changes Outlook to Negative After Purchases
HAPAG-LLOYD AG: Moody's Assigns 'B2' CFR After Downstream Merger
HAPAG-LLOYD: S&P Revises Outlook to Stable & Affirms 'B+' CCR
PRAKTIKER AG: Dirk Moehrle Eyes Acquisition of Max Bahr Unit


ANGLO IRISH: Ireland to Keep "Large Portion" of Loans
IRISH BANK RESOLUTION: Borrower Doesn't Want Suits Halted
NOSTRUM MORTGAGES 2003-1: Document Amendments No Impact on Rating
STANTON MBS I: S&P Raises Rating on Class B Notes to 'BB'


MEDIOLEASING FINANCE: Moody's Cuts Rating on Cl. B Notes to Caa1


BSN MEDICAL: Fitch Affirms, Withdraws 'B' Issuer Default Rating


* PORTUGAL: Review of Economic Progress After Bailout Begins


KRAYINVESTBANK: Fitch Affirms 'B+' Long-Term IDR; Outlook Stable
PIONEER GROUP: S&P Assigns 'B-' LT Corp. Credit Rating


MERCATOR: Appoints Advisers to Help with Debt Restructuring


CODERE SA: Moody's Revises PDR to Ca-PD/LD Following Default
PESCANOVA SA: May Face Liquidation if Banks Don't Accept Haircut


ORA: Declared Bankrupt by Court

U N I T E D   K I N G D O M

ABSTRACT: Pureprint Acquires Firm for Undisclosed Sum
BROOKLANDS SCHOOL: In Administration, Teachers Face Job Loss
JAGUAR LAND: Moody's to Raise CFR to 'Ba2'; Outlook Stable
MORTGAGE FUNDING 2008-1: Fitch Lifts Rating on Cl. A Notes to BB
SOUTHERN WATER: S&P Revises Outlook to Stable & Affirms 'BB-' CCR

TNT MAGAZINE: Put Into Administration in September
* Moody's Issues Report on UK Specialty and Care Home Providers


* Upcoming Meetings, Conferences and Seminars



FIRST INVESTMENT: Fitch Affirms 'BB-' LT Issuer Default Rating
Fitch Ratings has affirmed First Investment Bank AD's (FIBank)
Long-term Issuer Default Rating (IDR) at 'BB-' with a Stable
Outlook and Viability Rating (VR) at 'b-'.

Key Rating Drivers: IDRS, Support Rating and Support Rating Floor

The affirmation of FIBank's IDRs are based on Fitch's view that
there continues to be a moderate probability of support from the
Bulgarian authorities in case of need, which is reflected in the
Support Rating of '3' and Support Rating Floor (SRF) of 'BB-'.
Bulgaria's Long-term foreign currency IDR is 'BBB-' with a Stable

Fitch views the propensity of the Bulgarian authorities to
support FIBank as quite strong due to the bank's systemically
important bank status, it's almost exclusively deposit funding
and representations previously made to the agency by the
Bulgarian authorities. At end-H113, FIBank was the third-largest
bank in Bulgaria with a total assets market share of 8%, and the
second-largest retail deposit taker with a 13% market share.
Fitch does not expect any changes in terms of support as a result
of the proposed acquisition of MKB Unionbank (MKBU, BBB+/Rating
Watch Negative/b+), as the latter has a small market share of 2%.

At the same time, Fitch believes the Bulgarian authorities have
sufficient financial flexibility to support FIBank due to the
country's low government debt and significant available fiscal
reserves. FIBank's total liabilities were equal to a moderate
8.4% of GDP at end-2012, and 80% of FIBank's customer accounts
are covered by deposit insurance, meaning that the bank's
uninsured liabilities, with respect to which the authorities'
would take the decision on support, comprised a low 23% of total
liabilities (about 1.9% of GDP) at end-H113. Furthermore, 95% of
these uninsured liabilities are customer deposits, which Fitch
understands have been placed primarily by domestic clients.

However, in Fitch's view, weaknesses in the bank's corporate
governance and potentially high related party and relationship
lending, could result in somewhat greater uncertainty about the
authorities' readiness to support the bank in all circumstances.

Rating Sensitivities: IDRS, Support Rating and Support Rating

FIBank's IDRs, SR, SRF are sensitive to a change in Fitch's
assumptions about the availability of sovereign support for the
bank. A downgrade of the Bulgarian sovereign rating would likely
result in a downward revision of the SRF and therefore a
downgrade of the Long-term IDR as it would indicate Fitch's view
of a decline in the authorities' ability to provide support.

On Sept. 11, 2013, Fitch outlined its approach to incorporating
support in its bank ratings in light of evolving support dynamics
for banks worldwide. FIBank's SRF and SR could come under
downward pressure if Fitch concluded that potential sovereign
support for banks in Bulgaria, as a member of the European Union,
had materially weakened relative to its previous assessment.

Key Rating Drivers: VR

FIBank's VR reflects continued deterioration in asset quality
combined with weak reserve coverage, pressuring capitalization.
The VR also considers weaknesses in corporate governance,
potentially high related party and relationship lending, high
loan concentrations and weak performance. On the other hand, the
VR also considers FIBank's broad and stable to date deposit base.

FIBank's regulatory non-performing (NPL) ratio, increased to
12.2% at end-H113 compared with 5.8% at end-2011. This was mainly
as a result of large loans becoming NPLs, emphasizing the risks
associated with the high borrower concentrations. Furthermore,
reserve coverage of NPLs was low at 32% and only increased to 39%
if specific provisions (deducted from the capital base according
to Bulgarian National Bank regulations) are added.

At end-H113, exposure to the largest 20 borrowers stood at a
significant 3.6x Fitch core capital (FCC). Amortization of these
loans is very limited, and some borrowers have been granted
additional facilities, further increasing concentrations. Within
the largest borrowers, there are already loans that are
classified as NPLs.

In Fitch's view, the risk of related party and relationship
lending is high, given the two founding shareholders' interest in
capital-intensive projects in the tourist industry, incomplete
disclosure of the shareholder structure, and the quite high-risk
nature of some loan exposures.

Unreserved NPLs and watch loans (H113: 4.5% of total loans)
equaled a very high 123% of FCC. In Fitch's view, this undermines
the quality of capital, while the Tier 1 and total capital
ratios, at 11.1% and 12.7%, respectively, at end-H113, were only
slightly above the regulatory required and/or recommended
minimums. Pre-impairment profit is moderate, supported only by
sound fee and commission income. However, it is limited in terms
of strengthening the bank's solvency through internal capital

The VR is supported by FIBank's strong retail deposit franchise
and the absence of refinancing risk. Liquid assets in
unconsolidated accounts (as per Bulgarian National Bank
definition which includes 100% of mandatory reserves) were equal
to an adequate 26.6% of deposits at end-H113 (17.9% if mandatory
reserves are excluded).

Fitch does not expect an impact on FIBank's VR from the potential
merger with MKBU due to MKBU's moderate size (23% of FIBank's
total assets at end-2012) and the limited difference between the
two banks' VRs. However, the acquisition could be negative for
FIBank's standalone profile if it results in a significant
reduction in capital ratios or liquidity. The impact on these
metrics will depend on the financial terms of the transaction,
the details of which have not yet been made available to Fitch.

Rating Sensitivities: VR
The VR could be downgraded further in case of continued
deterioration in FIBank's loan performance and underlying asset
quality, resulting in increased pressure on the bank's
capitalization. The VR could be upgraded if the bank is
recapitalized. However, Fitch does not expect this given the
absence of equity injections in recent years.

The rating actions are:

-- Long-term IDR: affirmed at 'BB-', Outlook Stable
-- Short-term IDR: affirmed at 'B'
-- Viability Rating: affirmed at 'b-'
-- Support Rating: affirmed at '3'
-- Support Rating Floor: affirmed at 'BB-'


BANK OF CYPRUS: Fitch Keeps 'B' Covered Bonds Rating on Watch Neg
Fitch Ratings has maintained Bank of Cyprus Public Company Ltd.'s
(BoC; 'RD') covered bonds secured by Cypriot assets on Rating
Watch Negative (RWN). The covered bonds' 'B' rating was
originally placed on RWN on March 28, 2013, and subsequently
maintained on June 24, 2013.

Key Rating Drivers

The covered bonds have been maintained on RWN pending the review
of the impact of the current macroeconomic environment on the
performance of the residential mortgage portfolio, which is on-
going. Furthermore, the assessment of the bank's ratings post-
recapitalization will be made once pro-forma financial and credit
quality information become available.

Rating Sensitivities
As an exception to the agency's covered bond rating criteria,
Fitch no longer uses BoC's Long-Term Issuer Default Rating (IDR)
as a starting point for its covered bonds credit risk assessment.
However, once BoC's IDR is no longer on 'RD', the rating of the
covered bonds could potentially be affected by movements in BoC's
IDR. The rating of the covered bonds would also be vulnerable to
a deterioration of the performance of the residential mortgage

* CYPRUS: To Lift Capital Controls in January 2014
Maria Petrakis and Georgios Georgiou at Bloomberg News report
that Cyprus plans to lift all restrictions on the movement of
money in January, almost a year after becoming the first euro
member to seize bank deposits and impose capital controls to
avert a financial collapse.

According to Bloomberg, President Nicos Anastasiades said in an
interview in Nicosia on Tuesday that his country will be "the
best" at implementing its agreement with international creditors
as it tries to claw back to growth after forcing losses on
uninsured depositors in the Mediterranean island's two largest

"The goal right now is to create the conditions for growth and
tackle the serious problem of unemployment, to stabilize the
financial system," Bloomberg quotes Mr. Anastasiades as saying.
"The controls are being lifted.  They will end within a timeframe
of January 2014."

The third-smallest economy in the 17-nation euro area, Cyprus was
approved for a EUR1.5 billion (US$2 billion) payout by euro-
region finance ministers on Sept. 13, Bloomberg relates.  It was
the second disbursement under a EUR10 billion rescue program
following the country's financial meltdown mainly as a result of
banking losses on Greek government bonds, Bloomberg notes.

The International Monetary Fund also approved its EUR84.7 million
contribution to the payment, with Managing Director
Christine Lagarde saying the country had made "commendable"
progress in stabilizing its finances, Bloomberg discloses.


TIIMARI OYJ: Files for Bankruptcy Protection on Lack of Funding
Kati Pohjanpalo at Bloomberg News reports that Tiimari Oyj filed
for bankruptcy protection after failing to find funding.

According to Bloomberg, Tiimari said in a statement to the
Helsinki stock exchange on Wednesday that the company wasn't able
to secure enough financing to stay in business.

"We're extremely sorry that the existing economic uncertainty and
waning demand in retail trade nullified the measures taken over
the past few years aimed at developing the business, improving
sales and reaching profitability," Bloomberg quotes Chairman
Benedict Wrede and Chief Executive Officer Niila Rajala as saying
in a statement.

Tiimari, whose shares have slumped 89% this year, has lost
EUR66.9 million (US$89.3 million) over the past five years,
according to data compiled by Bloomberg.

The company examined several other refinancing possibilities,
including sales of assets and operations, and obtaining bank
loans or other external funding, without success, Bloomberg
discloses.  It said that a reorganization of operations wouldn't
have secured the continuance of operations, Bloomberg notes.

Tiimari Oyj is Vantaa, Finland-based retailer that sells
stationery and craft materials.


FRANZ HANIEL: S&P Raises CCR to 'BB+'; Outlook Stable
Standard & Poor's Ratings Services said that it has raised its
long-term corporate credit rating on Germany-based holding
company Franz Haniel & Cie GmbH (Haniel) to 'BB+' from 'BB'.  At
the same time, S&P affirmed the short-term credit rating at 'B'.
The outlook is stable.

S&P also raised to 'BB+' from 'BB' our issue ratings on Haniel's
senior unsecured debt.  The recovery rating on these instruments
remains unchanged at '3,' indicating S&P's expectation of
meaningful (50%-70%) recovery in the event of a payment default.

Likewise, S&P raised to 'BB-' from 'B+' its issue rating on
Haniel's subordinated notes.  The recovery rating on these notes
remains at '5', indicating S&P's expectation of modest (10%-30%)
recovery in S&P's stress scenario.

The upgrade reflects management's continuous focus on debt
reduction over recent months.  S&P revised Haniel's outlook to
positive on April 24, 2013, based on management's decisive steps
to reduce net indebtedness through lessened exposure to its two
main assets, pharmacies manager and health care service provider
Celesio AG (to 50.01% from 54.64%) and food wholesaler and
electronics retailer Metro AG (to 30.01% from 34.24%), and to
some smaller assets as well.  Since then, the company's LTV has
been consistently below the 40% mark that we believe commensurate
with our 'BB+' rating.  In early July, Haniel built further
financial headroom by reducing its stake in the business-to-
business direct marketing company TAKKT AG to 50.28% from 70.44%.
It used the EUR150 million in proceeds to repay debt.  In
addition, S&P understands that further divestments are possible,
at least to prefinance any new investments in the asset

S&P estimates the market value of Haniel's investment portfolio
at approximately EUR6 billion on Sept. 13, 2013 (assuming stable
unlisted asset values compared with June 30, 2013).  On the basis
of net debt of around EUR1.7 billion, S&P calculates LTV to be
close to 29% on that date (down from 42% on Dec. 31, 2012), which
is well below its 40% ceiling for the 'BB+' rating.

In the context of still modest macroeconomic prospects for
Europe, to which Haniel's portfolio companies are largely
exposed, asset valuations could remain volatile.  As a
consequence, S&P views Haniel's persistently reduced net debt as
a key feature supporting its current ratings.

The ratings on Haniel reflect S&P's view of its "satisfactory"
business risk profile and "significant" financial risk profile.

The stable outlook reflects S&P's view that Haniel should be in a
position to maintain an LTV ratio sustainably below 40% (with
some headroom), the threshold that S&P believes is commensurate
with a 'BB+' long-term rating.

For a positive rating action, assuming broadly unchanged
portfolio characteristics, S&P would look for a track record of
an LTV ratio below 35% and signs that Haniel would be able to
maintain this.  S&P would therefore expect acquisitions to be
mostly prefinanced with disposals.

Although S&P do not expect it at this stage, it could take a
negative rating action if Haniel failed to maintain the LTV ratio
below its rating threshold.

FRESENIUS SE: Moody's Changes Outlook to Negative After Purchases
Moody's Investors Service has changed the outlook to negative
from positive of Fresenius SE & Co. KGaA's and affirmed the Ba1
corporate family rating, Ba1-PD probability of default rating and
the Ba1 (unsecured bond)/Baa3/(P)Baa3 (secured bank) instrument
ratings for its debt issuing finance subsidiaries. Concurrently
Moody's has also changed provisional (P)Baa3 to definitive Baa3
instrument rating on US$300 million revolving facility of
Fresenius US Finance I, Inc. The ratings for Fresenius Medical
Care AG & Co. KGaA and its subsidiaries are not impacted by this
rating action.

Ratings Rationale:

The change in the outlook to negative follows FSE's announced
acquisition of 43 hospitals and other assets from Rhoen-Klinikum
AG (RK, currently rated Baa3) a publicly listed German private
hospital operator and a competitor to FSE's Helios subsidiary.
The total consideration is EUR3.07 billion and assets are
expected to contribute some EUR250 million of EBITDA based on
2013 forecast. The transaction is structured as an asset deal,
without the need for approval from RK's shareholders. It remains
subject to regulatory approvals and, given the history of RK's
ongoing minority shareholder litigation, could still be
challenged in court.

"The outlook change to negative of the Ba1 rating primarily
reflects the expected material increase in leverage of FSE,
despite positive strategic rationale for increasing the group's
scale and improving FSE's coverage of hospitals across Germany "
explains Alex Verbov, Moody's lead analyst for FSE. Proforma for
the transaction, and assuming an EBITDA of EUR250 million of the
acquired hospitals can be achieved, it estimates debt/EBITDA of
the combined group, including full consolidation of Fresenius
Medical Care, to reach around 4.0x, and excluding Fresenius
Medical Care, around 4.3x. These ratios will result in a leverage
that will position the credit weakly in its category. The
affirmation of the rating assumes that FSE will reduce its
external growth activities going forward, in order to support
deleveraging to levels back to ratios which are in line with
FSE's own targets, as well as within the triggers set to maintain
the current rating.

The transaction is to be fully debt funded and values the assets
at over 12x EBITDA multiple, slightly above the 11x valuation by
FSE during the public tender for RK's shares last year. Although
this higher valuation could be justified both by better
visibility of current trading and exclusion of lower margin
University Klinikum Giessen Marburg from the transaction, it does
offer a strategic premium. Moody's notes that FSE expects that
cost synergies of EUR85 million will be achieved following one-
off investment of EUR80 million, reducing this multiple to below

Though potentially reducing overall business risk, Moody's
cautions that the higher share of hospital operations in FSE
business mix going forward will require relatively high capital
expenditures for recently acquired hospitals both by Helios and
RK, which will tend to moderate free cash flows. As a result,
FSE's cash conversion rate from EBITDA achieved going forward may
well be lower than what has been observed historically for FSE.

The ratings could be subject to downward pressure if Fresenius'
leverage metrics weaken as exemplified by debt/EBITDA exceeding
4.0x (including on a stand-alone basis, i.e. adjusting for the
full consolidation of Fresenius Medical Care). Although the RK
transaction will increase the stand-alone leverage ratio
materially above 4.0x, Moody's acknowledges that FSE has a track
record of deleveraging following large acquisitions.
Strategically, the transaction is attractive to FSE. FSE achieves
a step-change towards national coverage and speeds up
consolidation pace, positioning itself as by far the largest

The negative outlook reflects Moody's expectation that FSE credit
metrics may remain above expected credit metrics a for long
period of time, with a degree of risk on the deleveraging
execution especially in view of uncertainty about reimbursement
cuts at Fresenius Medical Care and prospects for weaker relative
contribution from Kabi.

What Could Change the Rating -- Up

As current metrics position FSE weakly in its rating category,
prospects for an upgrade are remote. However, Moody's would
consider upgrading the ratings if FSE were to (1) reduce its
leverage on a sustainable basis towards 3.0x; (2) achieve further
improvements in its liquidity and debt maturity profiles, helping
to reduce its reliance on capital market refinancing; and (3)
limit debt-funded acquisition activity.

What Could Change the Rating -- Down

The ratings could be subject to downward pressure if FSE's
leverage metrics would not improve to levels to or below
consolidated adjusted debt/EBITDA 4.0x and/or consolidated EBITDA
margins decline below 20%. Large debt-financed acquisitions or
negative free cash flows, materially reducing the prospect of
deleveraging or worsening liquidity profile, could also be
drivers of a downward rating migration.

The principal methodology used in these ratings was the Global
Healthcare Service Providers published in December 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

HAPAG-LLOYD AG: Moody's Assigns 'B2' CFR After Downstream Merger
Moody's Investors Service has assigned to Hapag-Lloyd AG a B2
corporate family rating and the B2-PD probability of default
rating. At the same time, the rating agency has withdrawn the B2
corporate family rating and the B2-PD probability of default
rating of Hapag-Lloyd Holding AG for reorganization reasons. The
withdrawals follow the downstream merger of Hapag-Lloyd Holding
AG into Hapag-Lloyd AG. The outlook on the ratings is negative.

Ratings Rationale:

"The rating assignment is prompted by the downstream merger of
Hapag-Lloyd Holding AG into Hapag-Lloyd AG that now are one
single entity, whereas the B2 CFR reflects the good operating
performance in the first half of 2013, but also takes into
account our expectation that the freight rate environment will
remain constrained over the next 12 months," says Marco Vetulli,
a Moody's Vice President - Senior Credit Officer and lead analyst
for Hapag-Lloyd.

Despite the weak operating environment, characterized by
decreasing freight rates since August 2012, Hapag-Lloyd recorded
an adequate operating performance in the first half of 2013. This
was a result of some efficiency gains in terms of costs that have
enabled the company to become one of the most efficient operators
in the industry and achieve improvements in terms of

Nonetheless, Hapag-Lloyd's B2 CFR is constrained by two main

Firstly, the environment in which the company operates,
characterized by (1) high competition, which limits the
operators' ability to recover operating costs; and (2) the
overreliance of this shipping segment on short-term contracts,
which limits market visibility. These market characteristics have
credit-negative implications for container shipping companies'
ratings, on account of their high operating leverage and
sensitivity to operating cash-flow shifts.

Secondly, the company has high adjusted debt. Moody's would
expect this to be very weak for the rating category at the end of
the current year, with Moody's forecast of debt/EBITDA ratio
exceeding 7.0x on adjusted basis. Hapag-Lloyd was affected in the
past couple of years by the combined effect of low freight rates,
which constrained the company's profitability, and capital
expenditure, which increased its debt level. Moody's expects the
company to improve its credit profile by continuing to reduce
costs through its cost-saving program and record further progress
in its operating performance, and hence to improve its credit
metrics, though this is premised on freight rates remaining
supportive with bunker costs not increasing materially.

However, the rating remains supported by (1) the company's good
business profile, which is due to its leading market position as
a result of its successful commercial operations; (2) the
flexibility of its fleet (due to the high amount of chartered
vessels that could be redelivered in the next 12 months); (3)
Hapag-Lloyd's stable financial position, given not only its
adequate liquidity, but also the acceptable headroom under the
company's bank covenants.

The senior unsecured Caa1 rating assigned to the US$250 million
and EUR480 million senior unsecured notes is two notches lower
than Hapag-Lloyd's CFR and PDR of B2 and remains unchanged. This
reflects the contractual subordination of the notes to Hapag-
Lloyd's secured debt.

Rationale For Negative Outlook

The negative rating outlook reflects Moody's negative appraisal
of the global container shipping market over the next 12 months,
in combination with Hapag-Lloyd's relatively weak credit metrics
for the rating category. Any progress Hapag-Lloyd makes in
strengthening of its credit metrics will depend on the future
evolution of the container market and the global level of demand,
especially in Europe. Freight rates in the next few quarters
dipping sustainably below current levels and/or bunker costs
increasing beyond 2013 levels would put additional pressure on
the ratings.

What Could Change The Rating Up/Down

Moody's considers it unlikely that any upward pressure could be
exerted on Hapag-Lloyd's rating in the short term. However,
longer term, positive rating pressure could arise if the company
were to demonstrate progress towards (1) a reduction in financial
leverage approaching 6.0x on a sustainable basis; and (2) an
increase in its (funds from operations (FFO) + interest
expense)/interest expense of above 2.5x on sustainable basis.

The ratings presently incorporate Moody's expectation that Hapag-
Lloyd's currently weak credit metrics for the rating category
will recover in 2014. Moody's could downgrade the rating if
Hapag-Lloyd is unable to demonstrate a path to a stronger credit
metrics profile during 2014. For instance, financial leverage
remaining above 7.0x on sustained basis or (funds from operations
(FFO) + interest expense)/interest expense of below 1.5x would
indicate management's unwillingness or inability to de-risk the
capital structure. A rating downgrade could also result from any
pressure on Hapag-Lloyd's liquidity profile or a lack of a short-
term improvement in market conditions that would underpin the
strengthening of metrics.

Principal Methodology

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

Headquartered in Hamburg, Germany, Hapag-Lloyd AG is the largest
container liner shipping company in Germany and one of the
biggest worldwide based on global market coverage. As of June
2013, Hapag-Lloyd operated a fleet comprising 154 ships including
63 owned, 84 chartered-in and seven leased vessels, and recorded
a turnover of EUR6.8 billion on a last-12-months basis.

Hapag-Lloyd Group was established in 1970 as a result of the
merger of Hapag (1847) and North German Lloyd (1857).
Hamburgische Seefahrtsbeteiligung "Albert Ballin" GmbH & Co. KG
is the company's largest shareholder, with a 78% stake.

HAPAG-LLOYD: S&P Revises Outlook to Stable & Affirms 'B+' CCR
Standard & Poor's Ratings Services said that it has revised to
stable from negative its outlook on Germany-based shipping
company Hapag-Lloyd AG.

At the same time, S&P affirmed all of its ratings on the company,
including the 'B+' long-term corporate credit rating.

The outlook revision reflects that Hapag-Lloyd's financial
results for the first half of 2013 indicate an improvement in the
company's earnings, and that S&P expects this to continue in the
second half of the year.  While S&P believes that Hapag-Lloyd
will continue to face volatile trading conditions, S&P thinks
downside risk has moderated and the company should be able to
maintain a ratio of Standard & Poor's-adjusted funds from
operations (FFO) to debt of more than 12% over the near term,
which S&P considers to be commensurate with a 'B+' rating.  In
the 12 months to June 30, 2013, adjusted FFO to debt improved to
12.7%.  Furthermore, given its demonstrated track record of
proactive treasury management and access to funding amid
difficult lending conditions, S&P continues to believe that
Hapag-Lloyd will preserve its "adequate" liquidity

The rating on Hapag-Lloyd continues to be constrained by S&P's
view of the company's financial risk profile as "aggressive" and
business risk profile as "weak," as S&P's criteria define these
terms.  Further constraints are its high operating risk in the
cyclical, capital intensive, and competitive container shipping
industry, as well as volatile and structurally thin operating
margins.  However, S&P considers these risks to be mitigated by
its view of Hapag-Lloyd's leading global market position, good
diversification of its route network, and ownership of a
high-quality vessel fleet.  Furthermore, a strong management team
with substantial experience both in the industry and with Hapag-
Lloyd, and a track record of achieving cost savings, will
continue providing essential rating support, in S&P's view.

The stable outlook reflects S&P's view that, despite its
expectation of sustained competitive pressure on freight rates
and persistently volatile bunker fuel prices, Hapag-Lloyd will
continue to generate sufficient operating cash flows to maintain
its credit measures and a liquidity profile that is commensurate
with the current rating.  This should be supported by the
company's continued realization of cost efficiencies and its
ability to maintain an EBITDA margin of about 5% over the near-
to-medium term.  S&P views a ratio of adjusted FFO to debt of
more than 12% as appropriate for the 'B+' rating.

Furthermore, given the inherent volatility of the sector in which
Hapag-Lloyd operates and associated swings in earnings and cash
flow, S&P considers that maintaining liquidity as "adequate" is a
critical and stabilizing rating factor.

S&P could consider an upgrade if Hapag-Lloyd delivers sustained
EBITDA growth, pursues a balanced investment strategy, manages to
reduce its leverage, and improves its cash flow protection
measures at the level that S&P considers commensurate with the
higher rating, such as a ratio of adjusted FFO to debt of about
20% on a sustainable basis.

S&P could consider a downgrade, if Hapag-Lloyd experiences
lower-than-anticipated growth in transported volumes, accompanied
by a decline in freight rates.  This would likely be coupled by
the company being unable to sustainably achieve cost savings to
reach an EBITDA margin of about 5% in the context of volatile
industry conditions and prevailing high bunker prices that S&P
forecasts in its base case.  If this occurs, it would weaken the
company's cash flow generation and liquidity position.  Under
S&P's base-case scenario, it estimates that the company's
adjusted FFO to debt will remain at more than 12%.  Furthermore,
S&P forecasts that Hapag-Lloyd's ratio of liquidity sources
versus liquidity uses will remain at more than 1.2x through 2013
and 2014.  Nevertheless, S&P might consider lowering the rating
if it begins to see clear signs that credit ratios and liquidity
coverage are performing below its expectations.

PRAKTIKER AG: Dirk Moehrle Eyes Acquisition of Max Bahr Unit
Nicholas Brautlecht at Bloomberg News, citing Abendblatt, reports
that Dirk Moehrle joined a consortium of Hellweg, Einkaufsbuero
deutscher Eisenhaendler, or EDE, to buy "as much as possible" of
Max Bahr.

According to Bloomberg, Abendblatt said that Mr. Moehrle plans to
become a minority shareholder if its bid is successful.

Globus is the strongest rival in the takeover race, Bloomberg
says.  Bloomberg notes that financial investors are less likely
to be picked as buyers.

Dirk Moehrle is the son of former Max Bahr owner Peter Moehrle,
Bloomberg discloses.

As reported by the Troubled Company Reporter-Europe on August 1,
2013, Reuters related that the insolvency administrators of
Praktiker on July 30 said they have stepped up the search for an
investor by appointing Macquarie as advisor.  The administrators
hope that by finding an investor they can secure as many jobs and
stores as possible at the group, which has around 20,000 full and
part-time employees, Reuters disclosed.  They said they did not
expect any results from the search before the start of September,
but that all the 300 stores affected by the insolvency would
continue trading for now, Reuters related.  Of the 300 stores in
the insolvency process, 168 are Praktiker stores, 78 are Max Bahr
stores and a further 54 are Praktiker-branded shops that have
recently been converted to the Max Bahr signage, Reuters noted.

Praktiker AG is a German home-improvement retailer


ANGLO IRISH: Ireland to Keep "Large Portion" of Loans
Joe Brennan at Bloomberg News reports that Kieran Wallace, joint
liquidator of failed lender Anglo Irish Bank Corp., said Ireland
may be left with a "large portion" of former Anglo's loans even
as sovereign wealth funds, private-equity funds and banks circle
the first assets for sale.

According to Bloomberg, Mr. Wallace said in an interview in
Dublin that the first portfolio, codenamed Project Evergreen, has
a par value of EUR3.5 billion.  Thirteen loans within the
portfolio will be sold separately by the liquidators at KPMG,
appointed by the government to wind up the bank, Bloomberg
discloses.  The total loan book for sale has a par value of
EUR22 billion, Bloomberg notes.

Anglo Irish's implosion following a real-estate collapse five
years ago pushed Ireland to the brink of bankruptcy in 2010, as
its bailout cost neared EUR35 billion, Bloomberg relates.
Finance Minister Michael Noonan ordered the liquidation of the
lender in February, and told the country's bad bank, the National
Asset Management Agency, to take over unsold loans, Bloomberg

"A large portion will still more than likely go to NAMA, but
we're not disappointed by the level of external interest,"
Mr. Wallace, as cited by Bloomberg, said, adding the book has
drawn "very significant" interest.  "Given the nature of this
portfolio, it certainly will be one of the more attractive to
external investors."

Shane McCarthy, who is helping run the sale process at KPMG, said
that indicative bids for the Evergreen loans are due by Oct. 11,
Bloomberg notes.

The liquidators plan to start marketing two other loan books,
EUR7.8 billion of mainly U.K. commercial real-estate assets, and
EUR1.8 billion of Irish residential mortgages in the middle of
next month, Bloomberg discloses.

Mr. Wallace said he expects "a number" of borrowers will move to
buy out their loans "at par" to avoid them being sold to a third
party, Bloomberg notes.  Ireland's surviving banks are preparing
to finance some potential loan bidders, according to Mr. Wallace,
who, as cited by Bloomberg, said as many as 50 people at the
accountancy firm are working on the liquidation.

Mr. Noonan has ordered NAMA to take over whatever loans the
liquidators can't sell by the end of the year at a reserve price
being set by independent valuers, Bloomberg discloses.

According to Bloomberg, Mr. Noonan will have to reimburse NAMA if
the entire loan book is sold for, or independently valued, at
less than EUR12.9 billion.  That's how much NAMA paid the central
bank this year to buy out the part of the regulator's emergency
loans to Anglo Irish, by then renamed the Irish Bank Resolution
Corp. after being merged with the Irish Nationwide Building
Society, Bloomberg notes.

                        About Anglo Irish

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

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

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

The former Irish bank sought protection from creditors under
Chapter 15 of the U.S. Bankruptcy Code on Aug. 26, 2013 (Bankr.
D. Del., Case No. 13-12159).  The former bank's Foreign
Representatives are Kieran Wallace and Eamonn Richardson.  Its
U.S. bankruptcy counsel are Mark D. Collins, Esq., and Jason M.
Madron, Esq., at RICHARDS, LAYTON & FINGER, P.A., in Wilmington,

IRISH BANK RESOLUTION: Borrower Doesn't Want Suits Halted
Bill Rochelle, the bankruptcy columnist for Bloomberg News,
reports that Irish Bank Resolution Corp., formed to complete the
liquidation of Anglo Irish Bank Corp. and Irish Nationwide
Building Society, isn't eligible for bankruptcy protection in the
U.S. under Chapter 15, according to a borrower who doesn't want
his lawsuits in the U.S. halted.

According to the report, John Flynn and several companies that
borrowed from Anglo Irish filed papers last week telling the U.S.
Bankruptcy Court in Delaware that IBRC is ineligible for
protection under Chapter 15 of the U.S. Bankruptcy Code, which is
designed to assist a bankruptcy primarily pending abroad.

The report notes that the bankruptcy judge scheduled a Sept. 20
hearing to rule on IBRC's Chapter 15 eligibility.

The report relates that Mr. Flynn said he has fraud claims
against the failed bank for manipulating interest rates on loan
and personal guarantees.  His first argument against recognition
is based on the assertion that the bank had a branch in the U.S.
before the liquidation began.

U.S. bankruptcy law precludes a foreign bank from using Chapter
15 if it has a branch in the U.S.  Mr. Flynn said the IBRC case
will raise the question of whether the prohibition remains after
the U.S. branch was closed.  He also contended that the Irish
liquidation is being conducted for the exclusive benefit of the
Irish government and is thus improper.  He said the Irish
proceeding isn't a "collective" bankruptcy and isn't subject to
sufficient judicial oversight.

Mr. Rochelle notes that if the Delaware judge concludes that IRBC
is eligible and Ireland is home to the foreign main bankruptcy
proceeding, creditor actions in the U.S. will halt automatically,
including the lawsuit Flynn has in federal district court in

                        About Irish Bank

Irish Bank Resolution Corp., the liquidation vehicle for what was
once one of Ireland's largest banks, filed a Chapter 15 petition
(Bankr. D. Del. Case No. 13-12159) on Aug. 26, 2013, to protect
U.S. assets of the former Anglo Irish Bank Corp. from being
seized by creditors.

Irish Bank Resolution is seeking assistance from the U.S. court
in liquidating Anglo Irish Bank Corp. and Irish Nationwide
Building Society.  The two banks failed and were merged into IBRC
in July 2011.  IBRC was tasked with winding them down and
liquidating their assets.  In February, when Irish lawmakers
adopted the Irish Bank Resolution Corp., IBRC was placed into a
special liquidation in the Irish High Court to complete
liquidation and distribution of the two banks' assets.

IBRC's principal asset as of June 2012 was a loan portfolio
valued at some 25 billion euros (US$33.5 billion). About 70
percent of the loans were to Irish borrowers. Some 5 percent of
the portfolio was under U.S. law, according to a court filing.
Total liabilities in June 2012 were about EUR50 billion,
according to a court filing.

Most assets in the U.S. have been sold already.  IBRC is involved
in lawsuits in the U.S.

The IRBC liquidators want the U.S. bankruptcy judge to rule that
Ireland is home to the so-called foreign main bankruptcy
proceeding.  If the judge agrees and determines that IBRC
otherwise qualifies, creditor actions in the U.S. will halt

NOSTRUM MORTGAGES 2003-1: Document Amendments No Impact on Rating
Fitch Ratings says there is no rating impact on Nostrum Mortgages
2003-1 Plc following the issuer's decision to change the swap
counterparty and fund account deposit posting mechanism.

The switch in swap provider to JP Morgan (A+/Stable/F1) from
Caixa Geral de Depositos, S.A. (BB+/Negative/B) is in line with
Fitch's counterparty criteria for structured finance transactions
and therefore has no impact on any of the transaction's ratings.

The relevant transaction parties have also decided to post 1.3
times the amount of interest and principal collections collected
in the past quarter into a Fund Account Deposit. The deposit will
be rebalanced every quarter and posted at Bank of New York Mellon

Although the changes in transaction documentation reflect most of
the points outlined in Fitch's counterparty criteria for
structured finance transactions, the agency notes that the
volatility cushions in the credit support annex are not in line
with the counterparty criteria.

Should JP Morgan's rating be downgraded below that deemed
eligible under Fitch's criteria and should the swap provider
choose to post collateral to mitigate the increased counterparty
risk, the agency will assess the exposure using volatility
cushions outlined in its criteria. If the amount posted at the
time is deemed insufficient to fully mitigate the exposure, the
agency may take rating actions accordingly.

STANTON MBS I: S&P Raises Rating on Class B Notes to 'BB'
Standard & Poor's Ratings Services raised its credit ratings on
Stanton MBS I PLC's class A1 Rev FRN, A1 FRN, and B notes.  At
the same time, S&P has affirmed its ratings on the class A2, C,
and D notes.

The rating actions follows S&P's assessment of the transaction's
performance using data from the latest available trustee report
at the time of the analysis, dated July 29, 2013.

S&P subjected the capital structure to a cash flow analysis to
determine the break-even default rate for each rated class of
notes at the respective rating level.  In S&P's analysis, it used
the reported portfolio balance that it considers to be
performing, the current weighted-average spread, and the
weighted-average recovery rates that it calculated in accordance
with its 2012 criteria for rating collateralized debt obligations
(CDOs) of structured finance assets.  S&P applied various cash
flow stress scenarios, using different default patterns, in
conjunction with different interest rate stress scenarios for
each liability rating category.

In S&P's analysis, it has observed that the aggregate collateral
balance has reduced since its last review on May 16, 2012.  This
is mainly due to the deleveraging of the senior notes, which has
resulted in an increase in the available credit enhancement for
all classes of notes.

S&P has observed that the assets that we consider to be rated in
the 'CCC' category ('CCC+', 'CCC', and 'CCC-') and default assets
(rated 'CC', 'C', 'SD' [selective default], and 'D') have reduced
(both in notional and percentage terms) compared with its
previous review.  Overall, the collateral pool has experienced
negative rating migration, mainly due to the reduction in the
proportion of assets rated in the 'BBB' category ('BBB+', 'BBB',
and 'BBB-') and the increase in the proportion of assets rated in
the 'B' category ('B+', 'B', and 'B-').

The weighted-average spread is now at 1.94%, up from 1.62% at
S&P's previous review.  The par coverage tests are failing for
all classes of notes.  However, the class B and C test results
have improved (failing by lower margins) compared with S&P's
previous review.

In S&P's opinion, taking into account the results of its credit
and cash flow analysis, the available credit enhancement for the
class A1 Rev FRN, A1 FRN, and B notes is commensurate with higher
ratings than previously assigned.  S&P has therefore raised its
ratings on the class A1 Rev FRN, A1 FRN, and B notes.

S&P's credit and cash flow analysis of the class A2, C, and D
notes indicates that the level of available credit enhancement
for these classes of notes is commensurate with the currently
assigned ratings.  S&P has therefore affirmed its ratings on the
class A2, C, and D notes.

Stanton MBS I is a cash flow mezzanine structured finance CDO of
a portfolio that comprises predominantly residential mortgage-
backed securities, commercial mortgage-backed securities, and
CDOs of corporates and CDOs of asset-backed securities.  The
transaction closed in November 2004 and is managed by Cambridge
Place Investment Management LLP.


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

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



Class           Rating         Rating
                To             From

Stanton MBS I PLC
EUR383.32 Million Secured Floating-Rate Notes

Ratings Raised

A1 Rev FRN      A (sf)         A- (sf)
A1 FRN          A (sf)         A- (sf)
B               BB (sf)        BB- (sf)

Ratings Affirmed

A2              BBB- (sf)
C               B+ (sf)
D               CCC (sf)


MEDIOLEASING FINANCE: Moody's Cuts Rating on Cl. B Notes to Caa1
Moody's Investors Service has downgraded the rating of the Class
B notes of Medioleasing Finance S.r.l. to Caa1 (sf) from B3 (sf)
and affirmed at A2 (sf) the rating of the Class A notes. This
rating action follows Moody's recent downgrade of the
transaction's liquidity guarantor, Banca delle Marche S.p.A. to
Caa1 (on review for further downgrade) from B3 on September 5,
2013. Medioleasing Finance is an Italian lease ABS transaction.

Ratings Rationale:

The rating action is prompted by the downgrade to Caa1 (on review
for further downgrade) from B3 of Banca delle Marche's long-term
debt and deposit ratings on September 5, 2013. Banca delle Marche
is the liquidity guarantor for the transaction.

The Class B notes benefit from cash flows generated by the
securitized assets and from a liquidity guarantee from Banca
delle Marche. Until now the rating of the Class B notes has
always been in line with the guarantor's rating, given that the
quality and observed performance of the pool were not sufficient
to enhance the credit quality of the Class B notes above the
guarantor's rating.

Now that the guarantor is rated Caa1, Moody's believes that the
rating of the Class B notes is no longer directly linked to the
guarantor's rating, but mainly relies on the underlying portfolio
intrinsic credit quality. This is the reason why the Class B
notes are downgraded to Caa1 (sf) but are not put on review for
further downgrade, unlike the guarantor's rating.

As such, this action takes into account 1) the quality and
observed performance of the pool; 2) the limited credit
enhancement available to the Class B notes, given the reserve
fund should mostly benefit to the Class A notes as it will not be
available anymore once Class A notes are fully repaid; and 3) the
potential ineffectiveness of the early amortization triggers.

Moody's did not fully rely on the performance triggers designed
to mitigate the potential pool deterioration during the remaining
three and a half years of the revolving period through April
2017. Indeed, while one purchase termination event occurred (as a
consequence of the successive downgrades of Banca delle Marche
below Baa2 in May 2012 down to Caa1 in September 2013), the
transaction maintained its revolving capacity as, in accordance
with the transaction documentation, a purchase termination notice
shall be served if so requested by the majority of the
noteholders, and such request has not been issued at the date of
each notice.

- Key Collateral Assumptions

Performance in this transaction has remained relatively stable
overtime. As of the latest interest payment date in July 2013,
90+ day delinquencies represent approximately 2.6% of the
outstanding balance of the portfolio. Cumulative defaults on
original balance plus replenishments are at 12.8%, to be compared
to Moody's mean default assumption of 19.8% over the entire life
of the transaction.

Therefore, Moody's maintained its default and recovery rate
assumptions for this transaction, which it updated on December
18, 2012.

The current default assumption is 18.0% of the current portfolio
and the assumption for the fixed recovery rate is 45.0%. These
assumptions correspond to a B1 implied default probability rating
of the underlying pool over its remaining weighted average life
(approximately 5.5 years). Moody's has increased the CoV to 45.7%
from 42.0%, which, combined with the revised key collateral
assumptions, resulted in a portfolio credit enhancement of 25.5%.

- Moody's Has Considered Exposure to Counterparty Risk

Moody's rating review also takes into consideration the
counterparty exposure. In this transaction, Banca delle Marche
transfers collections every day to the issuer's account, which
resides at BNP Paribas Securities Services (A2/P-1). Moody's has
incorporated into its analysis the potential default of Banca
delle Marche, which could expose the transaction to a commingling
loss on the collections.

In addition, Italian lease ABS are also linked to a certain
extent to the credit profile of their originators, as they are
exposed to legal uncertainties associated with recoveries on
defaulted lease contracts following originator insolvency. If the
originator becomes insolvent, asset-sale proceeds could form part
of the insolvency estate. Moody's assesses the impact of the
legal risks by assuming a stressed recovery rate. Moody's takes
this linkage into account by reducing the recovery assumption on
defaulted lease contracts to a 15% range in case of an originator
default. The likelihood of an originator default scenario
occurring increases following the lowering of the rating on the
originator or its parent.

Class A notes are not affected by the increased counterparty
risk, given that the key collateral assumptions have been
unchanged and thanks to the high level of credit enhancement
(45.7%) they benefit from, in the form of subordination and
reserve fund.

Principal Methodology

The methodologies used in this rating were "Moody's Approach to
Rating Multi-Pool Financial Lease-Backed Transactions in Italy",
published in June 2006, "Moody's Approach to Rating EMEA SME
Balance Sheet Securitisations", published in May 2013, and "The
Temporary Use of Cash in Structured Finance Transactions:
Eligible Investment and Bank Guidelines", published in March

The revised approach to incorporating country risk changes into
structured finance ratings forms part of the relevant asset class
methodologies, which Moody's updated and republished or
supplemented on May 7, 2013 ("Incorporating Sovereign Risk into
Multi-Pool Financial Lease-Backed Transactions in Italy"), and
the publication of its Special Comment "Structured Finance
Transactions: Assessing the Impact of Sovereign Risk" published
on March 11, 2013.

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

List of Affected Ratings

Issuer: Medioleasing Finance S.r.l.

  EUR300M A Notes, Affirmed A2 (sf); previously on Aug 2, 2012
  Downgraded to A2 (sf)

  EUR105.4M B Notes, Downgraded to Caa1 (sf); previously on Feb
  15, 2013 Downgraded to B3 (sf)


BSN MEDICAL: Fitch Affirms, Withdraws 'B' Issuer Default Rating
Fitch Ratings has affirmed and simultaneously withdrawn the
following ratings for BSN Medical Luxembourg Group Holding

-- Long-term foreign currency Issuer Default Rating at 'B'
   with Stable Outlook

-- Senior Secured Credit Facility at 'BB'/'RR1'

Fitch has withdrawn the aforementioned ratings due to
insufficient information provided by the issuer to maintain
adequate coverage.


* PORTUGAL: Review of Economic Progress After Bailout Begins
BBC News reports that representatives from the International
Monetary Fund, the European Commission and the European Central
Bank have begun their latest audit of Portugal's economic health.

A raft of reforms was promised by Portugal's leaders in return
for its May 2011 bailout, BBC notes.

The visit from the so-called troika will determine whether the
country receives its next installment of bailout funds, BBC

It is expected to meet the criteria, BBC says.

The visit was originally expected to take place in July of this
year, but was postponed following a political crisis, BBC states.

There are fears that Portugal's economy remains volatile, and
borrowing costs have climbed again in recent months, according to

The yield on a benchmark 10-year Portuguese government bond
soared above the 7% barrier earlier this summer, BBC discloses.
That is the level at which other European countries have sought a
bailout, BBC notes.

Portugal received EUR78 billion (US$102 billion; GBP67 billion)
in May 2011, in return it began a tough austerity program, BBC

The Portuguese government says it is on track to emerge from the
bailout program in June 2014, according to BBC.


KRAYINVESTBANK: Fitch Affirms 'B+' Long-Term IDR; Outlook Stable
Fitch Ratings has affirmed Krayinvestbank's Long-term Issuer
Default Rating (IDR) at 'B+' with a Stable Outlook. At the same
time, the agency has put the bank's 'b-' Viability Rating (VR) on
Rating Watch Negative (RWN).

Key Rating Drivers: IDRs, Support Rating, National Rating and
Senior Debt Rating

KIB's '4' Support Rating and 'B+' Long-term IDR reflect the
limited probability of support that KIB may receive if needed
from the Krasnodar Region of Russia (KR; BB+/Stable), which
directly owns a 98% stake in the bank. Fitch's view of the
propensity to provide support is based on KR's majority ownership
and a track record of assistance to date both in the form of
liquidity support and the provision of capital, including
RUB1.5bn contributed in June 2012 and the planned RUB1bn equity
injection expected in Q413.

At the same time, Fitch views the probability of support from the
KR administration as only limited given KIB's moderate importance
for the region's banking system and significant concerns about
the bank's sizeable exposure to development and other non-core
assets (over 1.8x Fitch Core Capital (FCC) at end-H113). In the
agency's opinion, these have very questionable recoverability and
may be related to officials within the current regional
administration and/or the bank's management, thereby suggesting
weaknesses in corporate governance and potentially making
potential support more costly and less politically acceptable.

Key Rating Drivers: VR

The 'b-' VR reflects KIB's lumpy loan book, weak performance,
high exposure to construction and development sectors and
moderate capitalization. However, it also considers its improving
liquidity position and comfortable funding profile based on
granular retail deposits.

The RWN on KIB's VR reflects potential risks resulting from KIB's
exposure of RUB4.3 billion (0.9x FCC at end-H113) to third party
receivables (mostly, promissory notes) with questionable
recoverability. Fitch has not so far obtained sufficient
information on these investments to take a view on their quality
and recoverability, and expects to resolve the RWN after
receiving additional information on the exposures.

In addition, at end-H113 KIB had real estate development loans
(RUB2.1 billion, or 0.4x FCC) and holdings of investment property
(RUB2.6 billion, or 0.5x FCC). In Fitch's view, some of the
investment properties are reasonably valued, but half of the
exposures are higher risk residential properties at the initial
stage of construction, or industrial properties with very
questionable liquidity.

Though reported loans overdue by 30 days (non-performing loans;
NPLs) were a moderate 4.8% at end-2012 and 136% covered with loan
impairment reserves (LIR), underlying asset quality may be masked
by significant rolled-over loans (10% of end-2012 loans) and
long-term exposures. Fitch's review of KIB's 20 largest exposures
(accounting for roughly 64% of end-H113 corporate loans) revealed
that most of these are of high credit risk and are extended to
borrowers that have poor financial standing.

In light of significant construction exposure and poor asset
quality the liquidity of KIB's balance sheet is only modest
despite the liquidity buffer covering 20% of end-H113 customer
funding. As a moderate mitigant, KIB's exposure to third-party
wholesale funding is limited, while its customer funding (76% of
end-H113 liabilities) is relatively sticky with a high share of
granular retail deposits (50% of end-H113 liabilities).

KIB's performance remains weak, and its internal capital
generating capacity is insufficient to maintain the expected
annual growth. In Fitch view, the anticipated capital injection
of RUB1bn, which is expected to be made by end-2013, will have
only a temporary effect given ambitious growth plans (KIB targets
30% loan growth in 2014). KIB's current capital buffer (with the
regulatory capital adequacy ratio of 12.1% at end-H113) is
sufficient to withstand additional losses equal to only 4% of
loans, which is considered low by Fitch, given significant credit

Rating Sensitivities: IDRs, Support Rating, National Rating and
Senior Debt Rating

Downside pressure on KIB's support-driven ratings could arise
from any major weakening in the relationship between KR and the
bank, for example as a result of changes in key senior regional
officials (not Fitch's base case expectation at the moment as
KR's governor was reappointed one and a half years ago).

KIB's Long-Term IDR could be upgraded if KIB's systemic
importance increases and the bank's corporate governance notably
improves, but Fitch views this as unlikely in the near to medium

Rating Sensitivities: VR

The RWN on KIB's VR could be resolved with a downgrade if Fitch
is provided with insufficient information to take a view on the
risks associated with the third party receivables mentioned
above, or if the agency believes these risks are very high.
Conversely, if the risks related to these assets are more
moderate, KIB's VR may be affirmed at 'b-'.

Downward pressure on KIB's VR could also result from further
deterioration of asset quality and performance, resulting in
erosion of capital, or from growing exposure to development
projects and other non-core assets.

The rating actions are:

-- Long-term foreign and local currency IDRs: affirmed at 'B+';
   Outlook Stable

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

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

-- Viability Rating: 'b-', placed on RWN

-- Support Rating: affirmed at '4'

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

PIONEER GROUP: S&P Assigns 'B-' LT Corp. Credit Rating
Standard & Poor's Rating Services said it assigned a long-term
corporate credit rating of 'B-' to Russia-based residential real
estate developer CJSC Pioneer Group.  The outlook is stable.  S&P
also assigned to Pioneer a Russia national scale rating of

The ratings reflect S&P's assessment of Pioneer's business risk
profile as "vulnerable" and its financial risk profile as "highly
leveraged," as defined by S&P's criteria.  This view stems
primarily from the credit risks associated with the volatility
and working capital intensity of the residential property
development sector in Russia, as well as the relatively
concentrated nature of Pioneer's own portfolio of residential

S&P believes that Pioneer's capacity to meet its short-term
financial commitments and complete four projects currently under
construction (apartment complexes and their surrounding car
parking spaces and commercial units) is highly dependent on its
ability to generate cash from presales.  In the first half of
2013, Pioneer sold 30% of its units, bringing the unsold stock
down to 40% of the total units under construction.  As a result
of these strong sales figures, Pioneer was able to reduce its
short-term maturities by 33%, while its cash position increased
by 21% over the same period.  Consequently, Pioneer's Russian
ruble (RUB) 1.4 billion cash balances now exceed its RUB1.1
billion short-term debt maturities.  This improvement indicates
that Pioneer is currently less reliant on presales and on market
conditions to meet its financial commitments.

S&P also views positively Pioneer's decision to suspend dividend
distribution and the positive impact this should have on its
equity base, which S&P would otherwise consider as thin, since
the company is entering a potentially transformational expansion
phase.  Under S&P's base-case scenario, which assumes that
Pioneer's apartment sales and prices should continue to rise in
2013 and 2014, it foresees that its ratios of debt to capital and
debt to EBITDA should improve to about 60% and 2x in 2014.

Pioneer's business risk profile remains "vulnerable," reflecting
the high cyclicality and capital intensity of real estate
development.  S&P believes that the company has a limited track
record, having completed only seven projects since its inception
in 2001. In addition, the company is geographically concentrated
in Moscow and St. Petersburg.  However, S&P continues to see
solid demand in the next 12 months for economy and business class
apartments in the company's main markets, which should support
apartment sales and average selling process.  S&P views Pioneer's
financial risk profile as "highly leveraged" due to its
relatively weak ability to absorb unforeseen negative cash flows
if apartment sales slow down.  S&P sees a concentration of
secured bank financing and a lack of general corporate purpose
facilities as a further credit-limiting factor.  S&P notes that
the company plans to raise an unsecured bond of about RUB2
billion to improve the scope and funding profile of its
development projects.  S&P has not included this funding into its
base case at this time because the company has no track record of
capital markets issuance.

The stable outlook reflects S&P's view that Pioneer's operating
performance over the next 12 months should benefit from steady
demand for affordable apartments in its primary markets and
stable prices in the residential segment.  In S&P's opinion, the
company should meet its short-term liquidity requirements as long
as apartment sales and prices, as well as operating costs do not
suffer from heightened competition in the increasingly crowded
Moscow residential property market.  In addition, S&P anticipates
that Pioneer will likely improve its capital structure from
internally generated profit, reducing the debt-to-capital ratio
to about 60%, which S&P considers commensurate with the current

S&P could take a positive rating action if Pioneer makes further
progress toward addressing its short-term debt maturities and
demonstrates sustainable internal liquidity.  This would involve
sales of units at margins sufficient to fund the equity component
of remaining project costs, to service and repay debt, and to
cover the company's ongoing selling, general, and administrative
expenses.  A positive rating action also depends on stronger
equity support, such that Pioneer is able to sustain its debt-to-
capital ratio below 60% over the long term.

S&P could take a negative rating action if it saw evidence of
deteriorating liquidity, which could arise due to lower sales or
prices than S&P forecasts, cost overruns, or delays in project
completions.  S&P could also take a negative rating action if the
debt-to-capital ratio stays above 80% over the next 12 months.


MERCATOR: Appoints Advisers to Help with Debt Restructuring
Sandrine Bradley at Reuters reports that Mercator has appointed
advisers to help with a EUR1 billion debt restructuring.

The restructuring is a condition of a proposed sale of a 53.12%
stake in Mercator to Croatian food and retail group Agrokor,
Reuters notes.

In June, Agrokor said it would pay EUR120 per share for the food
retail group, valuing the company -- Slovenia's largest employer
-- at about EUR452 million, Reuters recounts.

A sale last year collapsed because Mercator's management at that
time refused to allow it to carry out due diligence, Reuters

It is not clear whether Agrokor will participate in the
restructuring talks, Reuters states.

"It would make sense if Agrokor expressed an opinion over what
form the restructuring should take," said Reuters quotes one
source close to the talks as saying.  "One of the restructuring
plans being considered does involve Agrokor."

Financial advisory firm Houlihan Lokey is advising a coordinating
committee of local and international banks on the restructuring,
while local law firm Schoenherr is acting as legal adviser,
Reuters discloses.

Mercator confirmed in a statement to Reuters that investment bank
Lazard and PricewaterhouseCoopers together with law firms
Clifford Chance and Jadek&Pensa are advising Mercator.

There are more than 20 banks involved in Mercator's EUR1.1
billion of debt, which includes a EUR137.6 million (US$183.73
million) unsecured syndicated loan signed in September 2011 and a
EUR130 million syndicated loan signed in March 2011, according to
Thomson Reuters LPC.

According to Reuters, the source close to the negotiations said
that under the sales plan with Agrokor, Mercator has until
December to agree a restructuring with its banks, this can be
extended to March 2014 if necessary.

The deal between Agrokor and Mercator is also still subject to
the relevant regulatory requirements, but according to the
source, Mercator will have to restructure its debt whether the
acquisition goes ahead or not, Reuters notes.

The restructuring is also likely to be carried out under largely
untested Slovenian restructuring law rather than a UK scheme of
arrangement, popular in these situations because it only needs
75% approval from creditors, Reuters states.

Mercator is a Slovenian retailer.


CODERE SA: Moody's Revises PDR to Ca-PD/LD Following Default
Moody's Investors Service has changed Codere S.A.'s probability
of default rating to Ca-PD/LD following the failure to pay, at
the end of the 30-day grace period, the coupon on the USD notes
issued by Codere Finance (Luxembourg) S.A. While the company has
announced that it will make the USD notes interest payment on
September 17, it has missed the grace period deadline of thirty
days after the due date of August 15. By Moody's definition, the
failure to make timely interest payments constitutes a limited
default (/LD).

Moody's has affirmed Codere's Caa3 corporate family rating (CFR)
and the Ca ratings on Codere Finance (Luxembourg) S.A.'s euro and
US dollar denominated notes. The outlook on all ratings remains

Ratings Rationale:

Moody's has appended Codere's PDR of Ca-PD with the /LD indicator
following the payment default on the coupon of the US$300 million
notes that was due on August 15, 2013. In line with Moody's
methodology, the rating action has been taken at the end of the
30-day grace period.

The company plans to pay the interest on the USD notes on
September 17, with the proceeds from an additional EUR35 million
term loan facility provided by the existing senior credit
facility lenders. Codere has also reached an agreement with the
majority of bondholders to forebear from accelerating the USD and
EUR notes as a result of the failure to make the coupon payment
within the grace period deadline. Moody's will remove the /LD
indicator from the PDR after 3 business days.

Moody's understands that the company is currently negotiating
with bondholders a restructuring of its debt that could represent
a distressed exchange. However, the rating agency notes the
ongoing complexity of this transaction and the uncertainty as to
whether it will be successfully completed.

The Caa3 CFR and the Ca rating on the senior notes reflect
Moody's estimate of a family loss-given default (LGD) rate of
approximately 35%. The LGD rate on the senior unsecured notes is
LGD3 (47%).

Codere's Caa3 rating reflects the company's weak liquidity, its
uncertain operating and financial prospects in light of its
weakening operating performance, the limitations in accessing
cash-flows from Argentina, and its high adjusted leverage, which
stood at around 6.1x as of June 2013. The rating also reflects
its position as one of the leading gaming operators in Latin
America, Italy and Spain, and its diversification in terms of
business lines, gaming assets and geographies.

The negative outlook reflects that further downward pressure
could be exerted on the ratings if the company fails to reach a
consensual agreement with its bondholders or if another form of
debt restructuring takes place resulting in a greater than
currently expected loss for bondholders.

What Could Change The Rating Up/Down

Downward pressure on the rating could develop if Codere were to
start a bankruptcy procedure, possibly resulting in higher losses
for bondholders than currently captured in Moody's ratings.

Upward pressure is currently unlikely but subsequent to any
future restructuring, Moody's might upgrade the ratings of Codere
to reflect the company's reduced debt burden. However, Moody's
believes that the turnaround of Codere's business and financial
performance will be very challenging, particularly given the
deterioration in operating performance across its main markets
reported YTD in 2013.

Principal Methodology

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

Codere is a multinational gaming operator that manages gaming
machines, machine halls, bingo halls, horse racing tracks,
casinos and sports betting locations in Latin America, Italy and
Spain. As of December 2012, Codere managed 56,474 gaming machine
seats, 186 gaming halls (including machine halls, bingo halls
with machines, machine halls at racetracks and casinos), 1,379
betting locations and three horse racing tracks. In 2012, Codere
generated operating revenue of EUR1.664 billion and EBITDA of
EUR305 million.

PESCANOVA SA: May Face Liquidation if Banks Don't Accept Haircut
Emma Ross-Thomas at Bloomberg News, citing Economista, reports
that Juan Manuel Urgoiti, Pescanova SA's new chairman, said the
company will be liquidated if banks don't accept a haircut on

According to Bloomberg, Economista said the banks rejected a
proposal for 75% reduction in debt.

As reported by the Troubled Company Reporter-Europe on Sept. 16,
2013, The Financial Times related that a group of shareholders in
Pescanova seized control of the scandal-hit Spanish frozen fish
company from its former chairman in a vote on Sept. 12, as it
seeks to renegotiate previously hidden debts of EUR3.6 billion
with its lenders.  Investors led by Damm, the Catalan brewing
company, which is Pescanova's second-biggest shareholder with a
5.84% stake, won a sweeping victory in the vote to remove the
fishing group's former chairman from the board and install new
directors, the FT disclosed.  Mr. Urgoiti, a veteran banker who
ran the now nationalized Banco Gallego and sits on the board of
clothing group Inditex, was installed as the company's new non-
executive chairman, at the Damm-led investors' suggestion, the FT

Pescanova is a Galicia-based fishing company.  The company
catches, processes, and packages fish on factory ships.  It is
one of the world's largest fishing groups.

Pescanova filed for insolvency on April 15, 2013, on at least
EUR1.5 billion (US$2 billion) of debt run up to fuel expansion
before economic crisis hit its earnings.  The Pontevedra
mercantile court in northwestern Galicia accepted Pescanova's
insolvency petition on April 25.  The court ordered the board of
directors to step down and proposed Deloitte as the firm's


ORA: Declared Bankrupt by Court
Benjamin Harvey at Bloomberg News reports that Turkey's state-run
Ziraat Bank said Ora shopping mall, which it gave a EUR270
million loan with a three-year grace period in 2010, was declared
bankrupt by a court on Tuesday.

According to Bloomberg, Ziraat said in a statement that the
shopping mall project was never completed as planned because
partners failed to fulfill obligation to add capital.

The statement said that the mall opened in 2011 and closed 2-3
months later, Bloomberg relates.  It said that Ziraat will
continue to play active role in the legal proceedings, Bloomberg

U N I T E D   K I N G D O M

ABSTRACT: Pureprint Acquires Firm for Undisclosed Sum
Hannah Jordan at PrintWeek reports that Pureprint has bought the
assets and business of Annodata printing division, Abstract,
after it fell into administration at the beginning of the month.

Abstract, registered under holding company Colne VCS, only became
part of Annodata in January 2012 when it merged with Annodata's
print division and handed over a 50% stake in the business,
according to PrintWeek.

"Annodata simply ran out of cash for the business. . . . They had
been trying to market it for several months but it went down in
the end.  We were one of seven looking to buy it.  In the end,
two of us bid and fortunately we won," the report quoted
Pureprint Chief Executive Mark Handford as saying.

The report notes that the GBP6 million turnover Bedfordshire-
based POS and packaging printer was put into administration with
Wilkins Kennedy on September 2 and sold to Pureprint on the same
day.  All 49 jobs have been retained with former managing
director Alan Harbison becoming general manager of Abstract's
2,787sqm facility in Houghton Regis, the report relates.

The report notes that following the acquisition the business will
continue as a separate trading company under the name Abstract --
a Pureprint Company.

The report relates that Handford said that ultimately the company
would be rebranded after an initial period of bedding in.

BROOKLANDS SCHOOL: In Administration, Teachers Face Job Loss
Robin Scott at Staffordshire Newsletter reports that parents were
left scrambling to relocate their children and teachers facing
redundancy after Brooklands School went into administration.

Chair of Governors Chris Lewis told Staffordshire Newsletter that
Brooklands School on Eccelshall Road in Stafford had been placed
into the hands of administrators.

"The key immediate concern for us now is the education of the
children. . . . So the one thing that the school has done is to
create a matrix of available places at schools in the area. . . .
Throughout the day today parents have been contacting those
schools about placing their children in them," the report quoted
Mr. Chris Lewis as saying.

The report discloses that Mr. Lewis said the future of the school
was unclear at this point as it was in a 'consultation phase' but
confirmed that staffs were facing redundancy.

JAGUAR LAND: Moody's to Raise CFR to 'Ba2'; Outlook Stable
Moody's Investors Service has upgraded to Ba2 from Ba3 the
corporate family rating and to Ba2-PD from Ba3-PD the probability
of default rating of Jaguar Land Rover Automotive PLC.
Concurrently, Moody's has upgraded JLR's senior unsecured notes
to Ba2 with a loss given default assessment (LGD) of LGD4-52%
from Ba3. The outlook on all ratings is stable.

The following ratings have been assigned:

Issuer: Jaguar Land Rover Automotive Plc.

Probability of Default Rating, Upgraded to Ba2-PD from Ba3-PD

Corporate Family Rating FC, Upgraded to Ba2 from Ba3

Corporate Family Rating LC, Upgraded to Ba2 from Ba3

$500M 5.625% Senior Unsecured Regular Bond/Debenture Feb 1, 2023,
Upgraded to Ba2 from Ba3

$410M 7.75% Senior Unsecured Regular Bond/Debenture May 15, 2018,
Upgraded to Ba2 from Ba3

$410M 8.125% Senior Unsecured Regular Bond/Debenture May 15,
2021, Upgraded to Ba2 from Ba3

GBP500M 8.125% Senior Unsecured Regular Bond/Debenture May 15,
2018, Upgraded to Ba2 from Ba3

GBP496.45M 8.25% Senior Unsecured Regular Bond/Debenture Mar 15,
2020, Upgraded to Ba2 from Ba3

Outlook Actions:

Outlook, Remains Stable

Ratings Rationale:

"The upgrade to Ba2 was prompted by JLR's strong and fairly
stable credit metrics over the past three years", says Falk Frey,
a Moody's Senior Vice President and lead analyst for JLR. "JLR's
strong results in the fiscal year 2012/13 were driven by the
company's broadened and competitive model line-up as well as its
improved geographic presence in emerging markets, especially in
China, which helped JLR to successfully compensate for the
sluggish car demand in its home region Europe," explains Mr.
Frey. "JLR's operating performance and financial ratios have been
robust despite the continued challenging economic environment in
Europe. This is positioning the company appropriately in the Ba2
rating category in our view."

In the fiscal year (FY) 2012/13 (ended March 31, 2013), JLR
reported another material increase in its volumes which reached
374,636 vehicles and represented a 22% rise compared with the
previous year. As a result of successful new model launches (e.g.
the new Range Rover) as well as growing demand for its SUVs such
as the Range Rover Evoque and Freelander (particularly in China
where unit sales climbed 48%) group revenues surged 17% to
GBP15.8 billion in the same period. These factors, combined with
a richer product and market mix as well as a more favorable
exchange rate environment, helped JLR to achieve a reported
record EBITDA of GBP2.4 billion in FY 2012/13 which clearly
exceeded Moody's expectations.

Moreover, despite JLR's heavily increased capital spending in FY
2012/13, the company managed to achieve positive free cash flow
(FCF) of GBP330 million on a Moody's adjusted basis, even
including an initial GBP150 million dividend payment to its
shareholder Tata Motors Limited ("TML"; rated Ba3, stable
outlook). However, Moody's expects JLR's future FCF generation to
weaken as capital expenditures will increase substantially to
around GBP2.8 billion this fiscal year from GBP2.0 billion in FY
2012/13 to support further investment in additional products,
manufacturing capacity, new technologies and to meet consumer
demand and emission reduction requirements. Correspondingly,
Moody's anticipates JLR's FCF to be negative and certain credit
metrics to weaken somewhat in the next three years. Nevertheless,
Moody's believes that JLR's key financial ratios will remain at
levels which are solidly commensurate with its current rating

In the first quarter of FY 2013/14, JLR's reported EBITDA of
GBP675 million as up 28% compared with the same period in the
previous year (GBP527 million). However, the company's adjusted
FCF for the 12 months ended June 2013 turned negative (GBP-304
million) which was largely driven by rising investment activity
as well as another dividend payment of GBP150 million during the
first three months of FY 2013/14.

JLR's Ba2 CFR positively reflects (1) the company's strong brand
names, which JLR is able to leverage when launching new products;
(2) moderate leverage, measured by adjusted debt/EBITDA, of 1.8x
in the 12 months ended June 2013; and (3) the commitment of its
sole shareholder, Tata Motors, to support JLR's product strategy,
capex plan and financial strategy, in line with previous

However, JLR's ratings are constrained by the weak financial
performance of TML on a standalone basis which has deteriorated
significantly over the last one and a half years . In this
context, Moody's notes that in FY 2012/13 JLR generated over two
thirds of the consolidated revenues and almost 80% of
consolidated reported EBITDA of TML, and thus is of considerable
strategic importance to its owner. Given the importance of JLR to
TML and the uncertainty with regard to JLR's financial policy and
potential need to support its parent, Moody's considers JLR's
rating to be capped at a maximum of one notch above that of TML,
which is currently rated Ba3 with a stable outlook. Nonetheless,
given JLR's strong operating performance and cash generation
ability, Moody's considers indebtedness located at the level of
JLR to be structurally senior to the debt issued by TML, which,
on a standalone basis, is relatively weaker.

Moreover, JLR's CFR also reflects some key challenges, such as
(1) its small scale as a niche player, with a still limited
product range and materially less financial strength than other
premium car manufacturers; (2) the cyclical nature of the
automotive industry, which can be exposed to big swings in
performance combined with high fixed costs; (3) JLR's strong
focus on the mature markets of Europe and North America (together
representing 57.7% of the company's retail sales) and on the
growing Chinese market (20.6% of retail volumes); (4) challenges
the company faces in ensuring its model range meets the required
emissions and fuel consumption levels in Europe and the US; (5)
Moody's expectation that there will be a sizeable increase in
JLR's capex and research and development expenditure to fund the
company's ongoing expansion of its model range, which will burden
FCF generation in the short to medium term and lead to increasing
net debt levels; (6) the company's high foreign exchange rate
exposure; and (7) JLR's still relatively limited track record of
growth and profitability. In addition, Moody's notes that the
Jaguar brand still needs to demonstrate sustainable growth and
remains a small niche business within the luxury car market.

The stable outlook reflects JLR's current credit metrics which
position the group solidly in the Ba2 rating category. The
outlook also reflects Moody's expectation that, despite
increasing capex and ongoing challenges and risks from slowing
economic conditions in some of JLR's key markets, the company
should be able to sustain its current operating performance and
financial metrics. In addition, the stable outlook incorporates
Moody's expectation of JLR to continue a conservative financial
policy, also taking into account expected high negative FCF in
the next two years driven by high capex payments.

What Could Change Rating Up/Down

While an upgrade is rather unlikely at this stage due to the
lower rating of JLR's parent TML which caps JLR's rating at the
current level, Moody's could consider upgrading JLR's ratings
should the company (1) be able to achieve an adjusted EBITA
margin above 7.5% on a sustainable basis; (2) reduce its adjusted
leverage ratio to 1.5x debt/EBITDA or lower; (3 ) return to FCF
around break-even and (4) maintain a solid liquidity profile
(Moody's considers that JLR currently has a well-spread debt
maturity profile, with all of its bond funding coming due between
2018 and 2023).

Conversely, JLR's ratings could come under pressure in the event
of a material deterioration in its key credit metrics, as
adjusted by Moody's, reflected by (1) debt/EBITDA rising well
above 2.0x; (2) EBITA margin falling below 6%; and (3) a further
deterioration of JLR's negative free cash flow. Moreover, a
substantial increase in JLR's dividend payments to its
shareholder TML or a potential downgrade of TML's CFR would exert
pressure on JLR's ratings.


JLR's liquidity profile as of June 30, 2013 is deemed as good.
Moody's expects the company to have sufficient cash sources,
comprising readily available cash, funds from operations and
undrawn committed credit lines. These cash sources should cover
JLR's cash uses over the next 12-18 months, including capex, debt
repayments, cash for day-to-day operations, working capital and
dividend payments. Moody's also anticipates JLR to maintain
comfortable headroom under its existing financial covenants.

Principal Methodology

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

Headquartered in Gaydon, UK, Jaguar Land Rover Automotive Plc.
manufactures and sells passenger vehicles under the Jaguar and
Land Rover brands and employs around 24,913 staff (as of June
2013). In the FY ended March 31, 2012, JLR sold 372,062 units,
generating revenues of GBP15.8 billion. JLR is
ultimately/indirectly 100% owned by Tata Motors Limited (rated
Ba3, stable outlook), which is India's largest automobile
company, with a sales volume of 1,196,416 units and revenues of
around US$34.8 billion in FY 2012/13.

MORTGAGE FUNDING 2008-1: Fitch Lifts Rating on Cl. A Notes to BB
Fitch Ratings has upgraded Mortgage Funding 2008-1 Plc's Class A
notes as follows:

Class A (ISIN XS0350039912): upgraded to 'BBsf' from 'CCsf'; off
Rating Watch Positive; Outlook Stable

The rating actions follow the restructuring of the transaction on
Aug. 23, 2013.

Key Rating Drivers
The total recoveries of US$119.6 million received from the Lehman
Brothers bankruptcy estate were converted to GBP76.8 million on
Aug. 22, 2013. Subsequently, the class A notes were redenominated
to GBP from EUR, resulting in an outstanding class A balance of
GBP554.8 million. At the same time, the unrated Class B notes
were written-down by 31.5% to GBP100.1 million.

On the most recent payment date on Sept. 13, 2013, the proceeds
from the terminated hedging agreement net of restructuring costs
were applied towards the partial redemption of the class A and B
notes, establishment of a liquidity reserve fund and a payment to
the residual certificateholders. Combined with the quarterly
principal pay-down on the class A notes, the credit enhancement
has increased to 16.9%, which includes an over-collateralization
of 1.8%. The liquidity reserve of GBP2m equivalent to 34bps of
the outstanding note balance is available to fund shortfalls in
senior fees and/or class A interest.

The upgrade of the class A notes to 'BBsf' from 'CCsf' thus
reflects the removal of the transaction's exposure to currency
risk and prior under-collateralization as well as current credit
enhancement levels, which the agency deems commensurate with a
'BBsf' rating.

Rating Sensitivities
A modest rise in interest rates could lead to deterioration in
performance of the underlying portfolio, which could be
exacerbated by the lack of a reserve fund.

SOUTHERN WATER: S&P Revises Outlook to Stable & Affirms 'BB-' CCR
Standard & Poor's Ratings Services revised its outlook to stable
from negative on Southern Water (Greensands) Financing PLC
(Greensands).  At the same time, S&P affirmed its 'BB-' long-term
corporate credit rating on Greensands.

In addition, S&P affirmed its 'BB-' issue rating on the
GBP475 million senior secured debt issued by Greensands.  The
recovery rating on this debt is unchanged at '4', indicating
S&P's expectation of average (30%-50%) recovery in the event of a
payment default.

Dividends from the Southern Water Services Ltd. (SWS)
securitization -- issued by Southern Water Services (Finance)
Ltd. (SWSF) -- are the main source of cash flow for its holding
company, Greensands. Greensands requires these dividends to meet
its debt service obligations.

The outlook revision on Greensands follows similar action on the
debt issued by SWS, triggered by an improvement in SWS' cash flow
coverage ratios.  In S&P's opinion, the SWS securitization is now
less likely to breach its dividend lock-up covenants.

All water companies in England and Wales are subject to
regulatory tariff reviews every five years.  A revenue shortfall
on metered customers, and operating cost increases that exceeded
inflation caused SWS to perform relatively weakly for the two
years at the start of the current price control period. In our
view, it recovered significantly in the financial year to March
31, 2013, due to a real tariff increase of 3.6%, and improved
cost control. S&P anticipates that SWS will be able to sustain
its performance improvement at least to the end of the current
regulatory period in March 2015.

The ratings on Greensands continues to reflect its view of the
"fair" business risk profile, which reflects the quality of the
incoming cash flow streams from Greensands' guarantors--
Greensands Senior Finance Ltd. and Greensands Junior Finance
Ltd.--which ultimately own SWS and its finance subsidiary SWSF.
Dividend payments from SWS, which is subject to a corporate
securitization, form the largest component of these cash flows.
The securitization includes covenant provisions that would lock
up these dividends for the benefits of the SWSF creditors; this
is, therefore, a key risk factor in S&P's assessment of
Greensands' business risk profile.  The ultimate parent companies
also receive income from intragroup tax efficiency operations and
these would be available even during a lock-up of dividends from
the underlying corporate securitization.  However, S&P considers
these income streams alone insufficient to maintain debt service
payments to Greensands for a sustained period.

Greensands' "aggressive" financial risk profile signifies S&P's
expectation that the company will maintain a debt-to-available-
cash-flow ratio of less than 5x (that is, Greensands' debt
divided by cash flows at SWS available to be paid as dividends).

In S&P's base-case credit scenario for Greensands, it assumes
that SWS will continue to meet the financial covenants included
in its debt documentation with a healthy cushion.  It will
therefore be able to distribute dividends to Greensands.  S&P
predicts that SWS will be able to upstream an average of GBP110.9
million each year to Greensands, while still meeting its dividend
lock-up covenants. S&P estimates Greensands' ability to upstream
dividends based on its economic forecast that the U.K. consumer
price index will be about 2.7% in 2013.  This would allow SWS to
increase its prices according to its regulatory agreement,
leading to about 5% growth in revenues in the financial year
ending March 31, 2014.

The stable outlook reflects S&P's opinion that Greensands will
continue to receive its forecast dividend from SWS.  S&P's
outlook also reflects its view that SWS will maintain adequate
headroom to avoid breaching lock-up covenants that are included
in the securitization documentation.  S&P also anticipates that
Greensands will maintain its "aggressive" financial risk profile,
with a debt-to-available-cash-flow ratio of less than 5x.

S&P could take negative rating action if it sees the potential
dividends paid to Greensands decline due to, for example,
operating difficulties at SWS or adverse regulatory decisions.
Other triggers for rating action include a downgrade of SWS--in
our view, this would indicate an elevated likelihood of the lock-
up trigger being breached.  S&P could also take negative rating
action if Greensands fails to maintain a three-year-average debt-
to-cash-flow ratio of less than 5x or if adjusted consolidated
leverage (that is, the combined debt of both SWSF and Greensands)
to EBITDA were to increase to more than 10x.  S&P would view this
as indicating increased financial risks.

In S&P's view, rating upside is limited due to Greensands'
financial policies.  S&P could take positive rating action if, in
its view, the financial policies were permanently changed to
reduce debt at both SWS and Greensands.

TNT MAGAZINE: Put Into Administration in September
-------------------------------------------------- reports that TNT Multimedia, publisher of TNT
Magazine and associated websites, was formally put into
administration earlier this month.

This is not the first time the popular travellers' magazine has
been handed to administrators, according to
The report relates that the same company, Moorfields Corporate
Recovery LLP, was appointed as administrators of TNT Publishing
Limited back in September 2011.

The report notes that TNT Multimedia was the new company that
then took over responsibility for the business, which has itself
now been put into administration.

The report says that it has been a dramatic fall in fortunes for
the legendary free title.

At the turn of the century, TNT Magazine was the undisputed bible
for South Africans, Australians and New Zealanders in London who
worked to fund their travels.

However, the report notes that the years immediately following
that acquisition saw the emergence of the internet as the
dominant media format for information in the areas that TNT's
advertising model relied on most; recruitment, travel and
classifieds.  The report relates that another challenge that
faced the market was the changing demographics of Aussies, Kiwis
and South Africans in the UK.

The report says that there have been concerted attempts in recent
years to adapt TNT to the new market realities, such as
broadening the target audience to all young travelers.
Nonetheless pages, circulation and advertisers have continued to
fall, with Time Out magazine's recent shift to a free
distribution model no doubt placing further pressure on TNT's
readership, the report relates.

The report relays that the ongoing struggles at TNT are
indicative of a tough 2013 for the old guard of the Australian
and New Zealand community in London.

* Moody's Issues Report on UK Specialty and Care Home Providers
Despite interest from private equity and debt investors in recent
years, UK specialty and care home providers require significant
investment to provide for the ongoing growth needed to facilitate
equity exit prospects, says Moody's Investors Service in a
Special Comment entitled "UK Specialty and Care Home Providers:
Volume Growth Requires Material Capital and Limits Deleveraging

All operators, despite their already high leverage, have invested
and continue to invest in either existing or additional capacity,
both via new developments or by taking over existing locations.
The sustainability of this growth is not possible without
continued investments, given that available capacity (number of
beds) and regulatory control of fees put a cap on organic growth.

Moody's notes that different approaches to funding this growth,
specifically the use of operating leases, are often key
differentiating factors in assessing credit quality. The large
proportion of operating lease funding used to grow capacity has
implications beyond leverage metrics alone, making operators more
susceptible to even small deviations in occupancy and fee levels.
This may, however, be mitigated by either agreeing variable
leases or securing better visibility of occupancy via block

Moody's also notes that industry deleveraging prospects remain
generally modest, with limited free cash flows available to repay
debt, which in many cases is uneconomical due to prepayment
penalties, a low interest rate environment and attractive
opportunities to invest capital for further growth. Large
absolute size is no guarantee of strong operating performance, as
scale advantages appear to be limited, reflecting the regional
nature of the business model.

Property valuations attached to freehold portfolios should not be
viewed as an absolute indicator of collateral value as they
reflect changing business conditions and ignore the often limited
alternative use of the purpose-built facilities or central costs
required to run them as a stand-alone portfolio. Moody's says
that previously provided valuations are potentially
overoptimistic and may not reflect a changing business


* Upcoming Meetings, Conferences and Seminars

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

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

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

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


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

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

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

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


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

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez,
Joy A. Agravante, Ivy B. Magdadaro, Frauline S. Abangan and Peter
A. Chapman, Editors.

Copyright 2013.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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

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