TCREUR_Public/151230.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

         Wednesday, December 30, 2015, Vol. 16, No. 256



AZERBAIJANI BANKS: Fitch Keeps Neg. Action on 4 Institutions


SUNCANI HVAR: Completes Pre-Bankruptcy Proceedings, Eyes Profit

C Z E C H   R E P U B L I C

VIKTORIAGRUPPE: SSHR Files Criminal Complaint in Germany


HECKLER & KOCH: S&P Raises CCR to 'CCC', Outlook Negative
PICKENPACK EUROPE: Greenland Seafood Still Keen on Buying TST
WALSUM PAPIER: Administrator Continues to Look for Investor


KVV LIEPAJAS: Says Elme Messer Metalurgs Claims Unfounded


ATENTO LUXCO: Fitch Affirms 'BB' Long-Term IDR, Outlook Stable


BANIF-BANCO FUNCHAL: Gov't Clears Hurdles for Santander Takeover


BANK OTKRITIE: S&P Maintains 'BB-/ruAA-' Ratings on Watch Neg.
KRAYINVESTBANK: S&P Lowers LT & ST Ratings to 'B-/C'
ROSAGROLEASING JSC: Fitch Affirms 'BB' IDR, Outlook Negative
SAMRUK-ENERGY: Fitch Affirms 'BB+' Senior Unsecured Rating
SECOND GENERATING: Fitch Assigns 'BB' Rating to RUB10BB Bonds

VNESHECONOMBANK: Moody's Affirms Ba1 Ratings, Outlook Negative
* Fitch Predicts Negative Outlook for CIS Utilities in 2016


PROCREDIT BANK: Fitch Revises Outlook to Pos. & Affirms 'B+' IDR
TRANSAERO AIRLINES: Sues Rosaviation Over License Revocation
VELEFARM HOLDING: EUR54.2-Million Strada Suit Resolved


CAJAMAR EMPRESAS 4: Fitch Raises Rating on Cl. B Notes to 'BB+sf'
INSTITUT CATALA: Fitch Rates EUR200MM Pagares Program 'BB'


BANK SOFIYSKIY: Declared Insolvent by National Bank of Ukraine
KYIV CITY: Fitch Raises Issuer Default Rating to 'CCC'

U N I T E D   K I N G D O M

ACE TELECOM: Directors Banned Over Multi-Million Pound VAT Scam
MARKETING AND LEAD: Debt Management Company Director Banned
RENEWABLE ENERGY: To Start Insolvency Process Early in 2016



AZERBAIJANI BANKS: Fitch Keeps Neg. Action on 4 Institutions
Fitch Ratings is maintaining International Bank of Azerbaijan's
(IBA) Issuer Default Rating of 'BB' on Rating Watch Positive
(RWP).  The agency has also put the IDRs of Demirbank (Demir),
Atabank (AB) and AGBank (AGB) on Rating Watch Negative (RWN) and
revised the Outlook on Unibank's (Uni) 'B' IDR to Negative from

The rating actions on five Azerbaijani banks are driven by the
Azerbaijani authorities' decision on Dec. 21, 2015, to abandon
the currency peg and move to a floating-rate regime.  A sharp
decline in the Azerbaijani manat hit local banks' capital ratios
via (i) inflation of foreign currency-denominated risk-weighted
assets (RWAs), and (ii) in some cases, significant translation
losses on unhedged short open currency positions (OCP).

Some banks face the risk of breaching capital ratios, although
Fitch believes that some regulatory forbearance is likely to be
provided, giving the shareholders time to inject capital and to
bring the banks in compliance with regulatory capital adequacy
rules.  This view is based on a track record of regulatory
forbearance being made available to the banking sector after a
previous 34% devaluation of the manat in February 2015.  In
addition, the regulator is planning to lower the minimum capital
ratio requirement to 10% by end-2015 from 12% currently, which
will help the banks to achieve compliance.

Additional longer-term downside stems from potential asset
quality pressure due to significant dollarization of the loan
books (sector average was around 60% after the devaluation),
while most of the borrowers have limited access to revenues in
foreign currency.

Liquidity may also be challenged if people start withdrawing
money, although according to banks deposits were stable in the
last several days.  In the worst case scenario, Fitch believes
that support from the Central Bank may be forthcoming.


Fitch's decision to maintain IBA's 'BB' IDR on RWP reflects
Azerbaijani authorities' improving propensity to provide support
to IBA, due to ongoing asset clean-up program, and also our
expectation that the state will support to offset the impact from
recent currency volatility.

Fitch estimates that the pressure on IBA's capital stemming from
currency devaluation was largely offset by the release of RWAs
following the buyout of AZN2bn problem loans by the authorities
in November and early December.  The bank converted most sales
proceeds into foreign currency, thus also reducing its short OPC,
while hedging the remainder.  The remaining AZN1bn problem loans
buy-out is planned by end-2015 and management has informed Fitch
that the authorities may consider other measures, if necessary,
to support the bank's solvency.  Fitch expects to upgrade IBA's
IDR by one notch when the last problem loans transfer has been
finalized and upon confirmation of the bank's solvency and
capital ratios remaining at reasonable levels, post devaluation.

According to IBA's regulatory accounts at end-11M15 the short
balance sheet currency position, although partially reduced by
converting the proceeds from problem loan sales into foreign
currency, was still significant at around AZN600 million (45% of
total regulatory capital).  However, according to IBA's
regulatory accounts, it was fully hedged with the Central Bank
and other government bodies and therefore IBA did not take a big
direct hit to equity from the devaluation.  The AZN1 billion bad
loans sale in early December (prior to devaluation) did not alter
the OCP, as the proceeds were reportedly in the same currency as
the sold portfolio.

At end-11M15, IBA's total capital adequacy ratio (TCAR) equalled
16%.  The release of RWAs from the sale of bad loans in December
should have partially offset the devaluation-driven inflation of
foreign-currency RWAs (around 60% of total RWA's at end-11M15).
Fitch therefore estimates that TCAR could have reduced by about
350bps, but should still be above the current regulatory minimum
of 12%.

The revision of the Rating Watch to Evolving from Positive on
IBA's 'b-' VR reflects uncertainty on IBA's capital position and
asset quality, as some of Fitch's conclusions/estimates are based
on preliminary information from management, while the exact
impact from asset sales, hedging and devaluation can only be
assessed after the publication of year-end accounts.

The IBA's Support Rating Floor (SRF) of 'BB' and its Support
Rating (SR) of '3' continue to reflect potential support from
Azerbaijani authorities, in case of need.  Fitch's view on the
probability of support is based on (i) IBA's high systemic
importance, stemming from its large domestic franchise (the bank
accounts for 36% of sector assets) and substantial funding from
state-owned corporations (around AZN1.5 billion or 15% of end-
1H15 liabilities); (ii) the bank's majority state ownership;
(iii) IBA's fairly small size relative to the sovereign's
available resources (assets equal to 15% of GDP at end-1H15);
(iv) the potentially significant reputational damage for the
authorities in case of IBA's default; and (v) improved track
record of support as reflected by IBA's financial rehabilitation
program announced in July 2015.


The revision of the Outlook on Uni's IDRs to Negative from Stable
reflects its weakened loss absorption capacity after devaluation,
while risks stemming from the bank's highly dollarized and
unsecured retail loan book have increased.  Fitch estimates that
the bank's Fitch Core Capital (FCC) ratio could drop by 3 pts,
down to 8% by end-2015.  However, Uni should remain compliant
with regulatory capital adequacy rules after the devaluation,
with an estimated TCAR of 13% by end-2015.

The RWN on AGBank, Demir and AB reflects the material erosion of
their loss absorption capacity as a result of the currency
devaluation.  Fitch estimates, that FCC ratios at AGB may drop to
zero by end-2015, and to a moderate 5%-6% at Demir and AB.

Demir's share of foreign currency RWAs was 27%, while its short
OCP was a moderate 20% at end-11M15.  Fitch estimates that the
bank's TCAR should therefore reduce by 2pps to around 11% by end-
2015, compared with the current regulatory minimum of 12%,
although if the latter is lowered to 10% the bank may still be

AB's share of foreign-currency RWA's was 36% and its short OCP
equalled 1.2x regulatory capital before devaluation at end-9M15.
According to management AB's OCP was largely hedged through
derivative contracts, although Fitch believes that there is some
uncertainty about the efficiency of these hedges.  If the hedges
are not effective, the bank could have lost around 60% of its
capital, taking its regulatory TCAR down to 6% at end-2015.

AGB had already been non-compliant with regulatory capital
adequacy rules prior to devaluation.  At date of the devaluation,
the bank had a large short OCP of 1.9x regulatory capital (of
this more than a half was hedged according to management) and a
high 40% share of foreign currency RWAs.  However, even if the
hedges are effective, the devaluation would still lead to TCAR
reducing to around 5% from current 9.7%.

The SRFs of 'No Floor' and SRs of '5' for Demir, Uni, AGbank and
AB reflect their relatively limited scale of operations and
market share.  Although Fitch expects some regulatory forbearance
to be available for these banks, in case of need, any
extraordinary direct capital support from the Azerbaijan
authorities cannot be relied upon, in the agency's view.  The
potential for support from banks' private shareholders is not
factored into the ratings.



IBA's SRF and IDR would be upgraded by one notch, to 'BB+', if
Fitch considers that the propensity to support the bank has
improved, which is to be confirmed by completion of the impaired
loans transfer and evidence that the capital hit from devaluation
is sufficiently mitigated by the authorities.

Conversely, any evidence of weakening of propensity to support,
for example, through delays to/cancellation of the remaining bad
loans transfer, and/or capital hit from devaluation not being
sufficiently offset by state support will result in the
affirmation of the ratings at current levels.

Although not a base case scenario, IBA's VR may be downgraded if
Fitch views that the bank's stand-alone credit profile has
markedly weakened due to the negative impact from devaluation
being much larger than expected.  This would be manifested in the
bank becoming reliant on significant extraordinary
support/forbearance and/or delays in finalizing the asset clean-
up, leading to the bank's asset quality problems not being

Conversely, if the impact from devaluation on capital ratios is
confirmed to be limited, the last bad asset transfer is completed
and Fitch takes a view that the quality of IBA's remaining loans
is reasonable, some upside potential for VR is possible.


Uni's ratings may be downgraded if asset quality deteriorates
beyond what can be absorbed by pre-impairment profit, thus
further eroding the bank's weakened capital.  Conversely, fairly
resilient asset quality and stable performance may help stabilize
the ratings at current levels.

The RWN on Demir, AB and AGB will be resolved upon our assessment
of the banks' reported capital positions following devaluation
and any potential actions taken to support the banks' solvency.
The banks could be downgraded if their capital ratios become
substantially below regulatory minimum levels and limited action
is taken to restore their solvency.  Negative rating pressure
could also stem from potential asset quality deterioration and/or
a liquidity squeeze.  However, to a large extent these risks are
already factored in the banks' fairly low ratings.

The ratings could be affirmed if the banks' capital positions are
not deeply eroded and/or are supported by
authorities/shareholders.  Fitch believes that a revision of the
banks' SR and SRFs is unlikely in the near-term, unless systemic
importance at any of these banks markedly increases.


The expected rating of IBA Moscow's senior debt issues is
equalised with that of its parent IBA.  This reflects IBA's offer
to purchase the bonds in case of a default by IBA Moscow, which
represents an irrevocable undertaking and ranks equally with
IBA's other senior unsecured obligations.  IBA Moscow's senior
unsecured debt rating is likely to move in tandem with IBA's

The rating actions are:


  Long-term foreign currency IDR: 'BB' maintained on RWP
  Short-term foreign currency IDR: affirmed at 'B'
  Viability Rating: 'b-', Rating Watch revised to Evolving from
  Support Rating: affirmed at '3'
  Support Rating Floor: 'BB' maintained on RWP
  Senior unsecured debt: 'BB', maintained on RWP


  Senior unsecured debt: 'BB(EXP)' maintained on RWP


  Long-term foreign currency IDR: affirmed at 'B', Outlook
   to Negative from Stable
  Short-term foreign currency IDR: affirmed at 'B'
  Viability Rating: affirmed at 'b'
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at No Floor


  Long-term foreign currency IDR: 'B', placed on RWN
  Short-term foreign currency IDR: 'B', placed on RWN
  Viability Rating: 'b', placed on RWN
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at No Floor


  Long-term foreign currency IDR: 'B-', placed on RWN
  Short-term foreign currency IDR: 'B', placed on RWN
  Viability Rating: 'b-', placed on RWN
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at No Floor


  Long-term foreign currency IDR: 'CCC', placed on RWN
  Short-term foreign currency IDR: affirmed at 'C'
  Viability Rating: 'ccc', placed on RWN
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at 'No Floor'


SUNCANI HVAR: Completes Pre-Bankruptcy Proceedings, Eyes Profit
SeeNews reports that Suncani Hvar on Dec. 23 said following the
successful completion of the pre-bankruptcy proceedings, the
company expects to end the year with an operating profit of
almost HRK68 million (US$9.7 million/EUR8.9 million).

According to SeeNews, Suncani Hvar said in a filing with the
Zagreb bourse that the projected positive financial results have
created the necessary requirements for the start of a new
investment cycle.

In June, Suncani Hvar said it is inviting eligible creditors to
convert their claims against the company into equity as part of
its court-approved pre-bankruptcy proceedings, SeeNews recounts.
As part of the proceedings, the company was obliged to raise its
capital by converting a portion of creditor claims into equity,
SeeNews discloses.

Suncani Hvar, which operates eight hotels on Hvar island, turned
to a consolidated net profit of HRK22.3 million in 2014 from a
loss of HRK173 million a year earlier, SeeNews relates.

Suncani Hvar is a Croatian hotel group.

C Z E C H   R E P U B L I C

VIKTORIAGRUPPE: SSHR Files Criminal Complaint in Germany
CTK reports that the State Material Reserves Administration
(SSHR) on Dec. 17 filed a criminal complaint against an unknown
perpetrator in Germany in the case of Viktoriagruppe in whose
storage tanks in Bavaria the Czech Republic has diesel oil,
according to SSHR spokesman Jakub Linka.

The criminal complaint has been filed at the State Attorney's
Office in Munich, the report says.

According to CTK, the Czech Republic has diesel oil for CZE1.2
billion in a storage facility of bankrupt Viktoriagruppe in
Krailling, Germany, and is unable to gain it back. It is in
dispute with the company's insolvency administrator over the
diesel oil ownership.

Apart from the diesel oil, there are other claims in the case.
The Czech Republic claims up to CZE1.8 billion in total.

"I can confirm that we have filed a criminal complaint against an
unknown perpetrator at the State Attorney's Office in Munich,"
SSHR chairman Pavel Svagr told CTK, adding that there is
suspicion of fraud and breach of trust.

"I realise that this is not too frequent that a state institution
files a criminal complaint abroad. But some suspicious deeds in
this case took place on the German territory so it is important
that German police investigate it," he explained.

CTK relates that a measuring made by German customs officers last
year in December shows that 6.3 million litres of the fuel is
missing in the Krailling storage facility. When the company was
declared insolvent, the storage tanks with the diesel oil have
been sealed, the report states.

SSHR is holding talks exclusively with the insolvency
administrator as it is not clear who is the owner of the oil,
Svagr said on public broadcaster Czech Television on Dec. 13, CTK

CTK notes that the Czech Arbitration Court ruled early in
November that company Cioltit is the owner of Viktoriagruppe.

Within a month at most, SSHR is going to submit to the cabinet a
draft of an agreement or a lawsuit over the oil reserves, Svagr
told CTK. He noted that a lawsuit could last three to five years
and costs might reach several tens of millions of crowns.

According to CTK, SSHR and the Office for Government
Representation in Property Affairs have been in talks with the
insolvency administrator about an out-of-court agreement
according to which the Czech Republic would get 80% of the oil
and the rest would be part of the bankruptcy assets. Such an
agreement would need a government approval.

Citing SSHR's latest data, CTK discloses that the Czech Republic
now has reserves of oil and oil products like diesel oil and
aviation petrol for some 95 days, while 90 days are mandatory.

The diesel oil that the Czech Republic has in Germany would cover
the country's consumption for some two days, the report notes.


HECKLER & KOCH: S&P Raises CCR to 'CCC', Outlook Negative
Standard & Poor's Ratings Services said it raised its corporate
credit rating on German defense contractor Heckler & Koch GmbH to
'CCC' from 'SD'.  The outlook is negative.

The issue rating remains at 'D'.

Heckler & Koch's recent repurchase of EUR45 million of its
outstanding EUR295 million senior notes due 2018, at below par
value, has only resulted in an incremental improvement in credit
metrics, which remain very highly leveraged.  S&P now forecasts
2015 Standard & Poor's-adjusted debt to EBITDA of about 13x,
compared to S&P's previous estimate of about 15x.  Adjusted
EBITDA interest coverage has marginally improved and is now
closer to 1x.

S&P's view of the company's business risk profile also remains
unchanged.  The group's revenue exposure is skewed to its
military segment, which remains constrained due to ongoing
uncertainty regarding the granting of export licenses to allow
Heckler & Koch to fulfill all of its existing orders.  German
export licensing policy is still unclear for EUR90 million of the
group's order book (EUR215 million at the end of September 2015).

The negative outlook reflects the risk of a downgrade within the
next 12 months, as S&P continues to see a risk of default.
Heckler & Koch's business prospects and cash flow generation
remain uncertain, which leaves the group vulnerable to further
adverse developments.

S&P could lower the rating if liquidity was to deteriorate -- for
example, if cash flow generation remained weak -- or if S&P felt
that the company was likely to undertake a debt restructuring or
distressed exchange.

S&P could revise the outlook to stable if it believed that
Heckler & Koch's business prospects were going to stabilize and
become sustainable, leading to positive trends in the group's
operating performance.

PICKENPACK EUROPE: Greenland Seafood Still Keen on Buying TST
Tom Seaman at Undercurrent News reports that a processor part-
owned by a member of the Ng family is still interested in a deal
for one of the Pickenpack Europe plants, which was in the works
before the latter's insolvency filing, sources said.

Undercurrent News relates that sources said Greenland Seafood --
part owned by Joo Chuan Ng, who is a member of the family that
are majority shareholders of Pacific Andes International
Holdings, and bought a 19% stake in Pickenpack in 2011 -- has
been and is still looking at a deal for TST The Seafood

TST, a frozen fish plant in Riepe -- around an hour west of
Wilhelmshaven, where Greenland Seafood is based -- went into
administration with Pickenpack on Dec. 2, according to the

Joo Chuan holds a minority stake in Greenland Seafood, with the
bulk of the shares held by Oleg Sizov, who also has ties to
Pacific Andes, Undercurrent News discloses.

"They [Greenland Seafood] are looking to expand and consolidate
and TST would be the perfect way to do this," one executive in
the German frozen fish sector, not wishing to be quoted by name,
told Undercurrent.

The plan, prior to the Ngs losing control of Pickenpack, was for
Greenland Seafood to buy the Riepe factory, he said. This has
been disrupted, however, by the escalation of the situation with
Pacific Andes and Pickenpack, the report says.

Undercurrent News notes that the voluntary bankruptcy filing of
Pickenpack means an administrator has been appointed and a formal
sale process for the company will be run, with the plan to sell
the business as a whole.

Patrick Barinet, managing director of Greenland Seafood, formerly
owned by Royal Greenland, declined to comment to Undercurrent on
whether or not the company had been looking at a deal for TST
prior to the Pickenpack insolvency filing.

Mr. Barinet also declined to go into detail on how seriously
Greenland Seafood will engage in the impending sale process of

"As for Pickenpack, we just do not know what will happen.
Everyone is waiting for access to the data room," Barinet told

According to the report, law firm Boege Rohde Luebbehuesen (BRL),
the administrator of Pickenpack, has brought in professional
services company Ernst and Young (EY) to advise on the sale

Undercurrent News relates that the plan from BRL and EY was to
send out a teaser to a long list of possible interested parties
before Christmas, said Friedrich von Kaltenborn-Stachau of BRL,
who is heading up the Pickenpack administration.

These will include investors and possible trade buyers from
Russia, the US, Europe and Asia, he told Undercurrent, on Dec.

According to Undercurrent News, Mr. von Kaltenborn said the aim
is to have first round bids in later in January, the second round
in February, and for a deal to be agreed in Q1.

Although BRL has stated the plant in Luneburg and the TST
operation in Riepe will continue to operate as normal, the
situation with the company is a concern for customers, suppliers
and also competitors, Mr. Barinet said.

"They are a big player in the market, so, of course we are
concerned, as the whole industry is concerned," the report quotes
Mr. Barinet as saying. "It would not be responsible not to
analyze it. What happens with Pickenpack will impact the market,
we are just not sure how yet, as it is too early to say."

Mr. Barinet also declined to comment on the apparent link between
Greenland Seafood and Pacific Andes, via the shareholders, the
report relays.

He would also not be drawn on how the current woes of Pacific
Andes -- which is facing the liquidation of its cash cow, China
Fishery Group -- might impact the fortunes of its own
shareholders, Undercurrent News states.

WALSUM PAPIER: Administrator Continues to Look for Investor
EUWID Pulp and Paper reports that Walsum Papier, which recently
entered into takeover talks with Niederauer Muhle, will continue
to be up for sale.

EUWID relates that the company's temporary insolvency
administrator said that he again filed for another extension of
insolvency benefits to Feb. 1, 2016 in order to sell the company.

Takeover talks with Niederauer Muhle were supposed to be
exclusive and to be finalised in the foreseeable future in order
to save the paper mill from insolvency. Niederauer Muhle's
management declined to comment on the present state of the
takeover talks, EUWID notes.

EUWID says Walsum Papier is planning to resume paper production
after taking scheduled maintenance downtime in the year-end
holiday period. The mill's TMP line is to restart on January 2,
its LWC machine is scheduled to be up and running on January 3.

Norske Skog Walsum filed for insolvency in June and changed its
name into Walsum Papier, EUWID recounted.  The opening of regular
insolvency proceeding was originally scheduled for Sept. 1 and
then postponed to the start of this month.  According to EUWID,
the extension period has reportedly worked in favor of the
administrators by creating additional space to negotiate with
interested parties.


KVV LIEPAJAS: Says Elme Messer Metalurgs Claims Unfounded
The Baltic Course, citing LETA, reports that KVV Liepajas
metalurgs insisted that all claims by Elme Messer Metalurgs are
unfounded, and that it will prove its solvency in court.

According to the report, KVV Liepajas said it owes nothing to
Elme Messer Metalurgs, and the latter's claim will have no effect
on the company's operations.

An insolvency claim against KVV Liepajas metalurgs has been
submitted to the Liepaja Court, The Baltic Course discloses
citing information on the Insolvency Administration's Web site.

The claim was submitted by Elme Messer Metalurgs, and an
insolvency process was initiated on December 16, the report
discloses.  According to The Baltic Course, the company's board
member Salvis Fridrihsons told LETA that the claim was submitted
due to unpaid debts for gas supplied to KVV Liepajas metalurgs.

The Liepaja Court reviewed Elme Messer Metalurgs claim on
December 29, says The Baltic Course.

The report notes that after a two-year halt in production, the
metallurgical company resumed production in February of 2015
after it was purchased by Ukraine's KVV Group in October of 2014
for EUR107 million.

The report relates that the company previously informed that
despite the catastrophic situation in the metallurgy market, KVV
Liepajas metalurgs has not only resumed production this year, but
also managed to stabilize production volumes, optimize production
costs and energy consumption, as well as make the sales process
more efficient. KVV Liepajas metalurgs has also been able to
agree to terms on new and economically beneficial purchase
agreements, which allow it to purchase raw materials at a better

The Baltic Course adds that the company also informed that even
though it will conclude 2015 with substantial losses, it hopes
that, together with some state support, it will continue to
strengthen its position in the market next year and overcome the
problems it currently faces.


ATENTO LUXCO: Fitch Affirms 'BB' Long-Term IDR, Outlook Stable
Fitch Ratings has affirmed the Long-term foreign-currency Issuer
Default Ratings for Atento LuxCo 1 S.A. at 'BB' with a Stable

Fitch has also affirmed Atento's USD300 million senior secured
notes at 'BB.'


The ratings reflect Atento's third-largest market position in the
global customer relation management (CRM) industry with a
well-established long-term client relationship and geographical
diversification.  This has enabled the company's stable business
growth and should continue to support stable EBITDA generation
over the medium term under the solid industry growth outlook.
Negatively, the ratings are tempered by the intense competitive
landscape amid sluggish economic conditions, and a high customer
concentration risk.

Stable Growth Outlook:

Fitch expects Atento's EBITDA generation to maintain its solid
growth momentum, on a local-currency basis, in most of its
operational geographies backed by the increasing demand for
CRM/BPO (business processing outsourcing) services.  Although the
competitive landscape is intense due to new entrants and price-
based competition for low-end services, the company's well-
established market leading position as well as its increasing
scope of advanced product offerings should help mitigate this
risk and enable stable growth over the medium term.
During the third quarter of 2015, Atento's advanced solution
services represented 24% of total revenues.

During the first nine months of 2015 (9M15), Atento's revenues
grew by 10% on a constant currency basis, despite subdued
economies, especially in Brazil.  The company has continued to
acquire new clients while also successfully expanding the scope
of its service offerings with existing clients.  Ongoing local
currency depreciation could continue to negatively affect USD-
based reported financials, but the impact should not be material,
as its revenue and operating costs are well-matched in local
currencies in its operational geographies.  In addition, the
company does not face any sizable USD debt maturity until 2020.

Negative FCF:

Fitch forecasts Atento to generate negative free cash flow (FCF)
in the short term due to a material increase in its working
capital requirement, mainly due to contract renegotiation with
some of its main clients.  The company's account receivables have
notably increased during the last 12 months (LTM) ended Sept. 30,
2015, suppressing its cash flow from operations (CFFO) to just
USD21 million, a sharp decrease from USD135 million in 2014.  As
Atento's capex could hover at around USD90 million to USD100
million a year, a failure to turn around its working capital
burden could pressure its FCF generation into negative territory
in the short term.

Stable Leverage:

Despite projected negative FCF generation, Fitch forecasts
Atento's net leverage to remain stable at close to 3.0x over the
medium term.  While recent unfavorable FX movement has largely
diluted the company's solid growth in local currency EBITDA
generation, the outstanding amount of its local currency-
denominated debt, mainly in Brazil, has also decreased.  As a
result, total gross debt fell to USD572 million as of September
2015 from USD653 million at end-2014.

A downward trend in rental expenses has been positive, leading to
a lower level of off-balance-sheet debt.  Fitch forecasts rental
expense to represent about 4% of the company's total sales,
compared to 7.9% in 2010, driven mainly by the company's
relocation of its work stations to less expensive sites.  As of
September 2015, Atento's adjusted net leverage was 3.3x, which
compares to 3.6x at end-2014.

Stable Operating Margins:

Fitch forecasts Atento's EBITDA margins to remain stable over the
medium term, in line with 2014's level of 11.3%, excluding the
one-off IPO-related cost, backed by cost reduction initiatives
despite inflationary pressures.  The company has coped with
increasing labor costs, the highest component of its cost
structure, representing 72.5% during first nine months of 2015,
by working station relocations.  Atento has also taken other
cost-cutting measures such as centralized procurement of
operating equipment, and IT system transformation to
improve productivity. The company's EBITDA margin was 11.5%
during the 9M15.

Mitigated Customer Concentration Risk:

Atento is exposed to a significant customer concentration risk as
it generates over 45% of total revenues from its largest client,
Telefonica Group.  Positively, Fitch believes that this risk is
alleviated by the service agreement with Telefonica which
guarantees an inflation-adjusted revenue threshold until 2021
along with the ongoing expansion of its non-Telefonica client
base, enabling stable cash generation.  In addition, the company
boasts well-established long-term relationship with its clients,
as it generates close to 90% of its total revenue from clients
who have contracted with Atento for more than five years.


Fitch's key assumptions within the rating case include:

   -- Ongoing FX volatility to result in negative revenue growth
      in the short term

   -- EBITDA margin to remain in the range of 11%-12% over the
      medium term despite inflationary pressures due to the cost
      saving initiatives

   -- Capex-to-sales ratio to gradually fall to below 5% over the
      medium term

   -- Negative FCF generation in the short term, due to a large
      working capital requirement

   -- Adjusted net leverage to remain close to 3.0x over the
      medium term.


Negative rating action can be considered in the case of an
increase in net debt-to-operating EBITDAR toward 4.0x on a
sustained basis, caused by a decline in operating margins and
slower revenue growth in a sluggish economy, and/or continued
negative FCF, partly due to a continued high working-capital
burden.  In addition, the ratings could be pressured should the
company's readily available cash plus CFFO-to-short-term debt
ratio fall below 1.5x.

Conversely, Positive rating action could be considered should the
company continue its strong growth momentum over the medium term.
Improvement in key operational metrics, such as reduced customer
concentration, and higher diversification into and penetration of
advanced solution offerings, as well as consistent positive FCF
generation leading to its net leverage falling close to 2.5x on a
sustained basis could also be positive for the ratings.


Atento retained a sound liquidity profile as of Sept. 30, 2015,
as its consolidated readily available cash (USD175 million)
comfortably covered its short-term debt of just USD25 million.
In addition, the company held an undrawn credit facility of
EUR50 million.  Fitch does not foresee any liquidity problem
given the company's long debt maturities schedules.


BANIF-BANCO FUNCHAL: Gov't Clears Hurdles for Santander Takeover
Henrique Almeida at Bloomberg News reports that Portuguese Prime
Minister Antonio Costa succeeded on Dec. 23 in getting parliament
to approve changes to the 2015 budget that will help clear the
way for Banco Santander SA to take control of Portuguese lender
Banif-Banco Internacional do Funchal SA's operations.

According to Bloomberg, the Socialist government's amended budget
was changed to include a EUR2.26-billion (US$2.5 billion) cash
injection into Banif.  Portugal split Banif in two and agreed to
sell some assets to Banco Santander for EUR150 million, Bloomberg

"If the amended budget is rejected, that implies the reversal of
the deal," Bloomberg quotes Finance Minister Mario Centeno as
saying at a parliamentary hearing on Dec. 22.

Headquartered in Lisbon, Portugal, Banif - Banco Internacional do
Funchal, S.A. provides banking and financial products and


BANK OTKRITIE: S&P Maintains 'BB-/ruAA-' Ratings on Watch Neg.
Standard & Poor's Ratings Services said that it had maintained
its CreditWatch with negative implications on its 'BB-/ruAA-'
long-term counterparty credit and Russia national scale ratings
on Bank Otkritie Financial Co. (Bank OFC) and on its 'B+/ruA'
long-term counterparty credit and Russia national scale ratings
on Bank OFC's subsidiary Khanty-Mansiysk Bank Otkritie (KhMBO).
S&P initially placed the ratings on CreditWatch with negative
implications on Feb. 24, 2015.

At the same time, S&P affirmed the 'B' short-term ratings both

S&P understands that Otkritie Holding requested additional
support from the Deposit Insurance Agency (DIA) and the Russian
Central Bank (CBR), which should be sufficient to cover negative
equity of Trust Bank, which may be merged with KhMBO.

According to the information disclosed in several press
publications, the money will be provided if Otkritie Holding wins
at a subsequent auction, which is expected to take place during
the first quarter of 2016.  If another entity bids a lower price
than Otkritie Holding for the rehabilitation of Trust Bank,
Otkritie Holding will likely be removed from the rehabilitation
process for Trust Bank.  S&P believes that this creates
continuing uncertainty around the group's structure.

S&P also believes that, given the complex processes with regard
to additional state support for Trust Bank, the merger between
Trust Bank and KhMBO is unlikely to take place before the
procedures for additional support are completed.  If the merger
materializes, it will have an uncertain impact on Bank OFC's
credit profile. Consequently, S&P is maintaining its CreditWatch
with negative implications on both Bank OFC and KhMBO.

S&P aims to resolve the CreditWatch within the next three months
when the CBR, the DIA, and the Otkritie Holding group expect to
finalize the integration roadmap for TRUST Bank's financial
rehabilitation.  At that time, S&P also expects to have a better
understanding of the potential impact of the integration process
and the consolidation of capital on Bank OFC, KhMBO and their
ultimate parent, Otkritie Holding.

S&P could lower the ratings if S&P believes that Bank OFC's
consolidated financial profile has worsened due to the change in
the group's structure.  S&P could also lower the ratings if it
believes that the group's updated ownership structure and the
structure of intragroup exposures makes Bank OFC vulnerable to
changes in credit quality of other, less creditworthy entities
within the group.  A merger with Trust Bank would likely result
in a negative rating action on KhMBO, as S&P expects the
postmerger entity to be in regulatory forbearance.

S&P could affirm the ratings if it believes that the group's
structure and Russian regulations allow S&P to consider Bank OFC
as immune to risks from the rest of the group, with regulators
having sufficient power to prevent the group from utilizing Bank
OFC's resources to support weaker parts of the group in times of
stress.  The affirmation of the ratings on KhMBO would likely
depend on maintaining the current group structure, with KhMBO
remaining as a subsidiary of Bank OFC.

KRAYINVESTBANK: S&P Lowers LT & ST Ratings to 'B-/C'
Standard & Poor's Ratings Services lowered its long- and short-
term ratings on Krayinvestbank to 'B-/C' from 'B/B' as well as
its Russia national scale rating to 'ruBBB-' from 'ruBBB+', and
then suspended the ratings on account of Krayinvestbank being
listed on Dec. 22, 2015 as a "specially designated national" by
OFAC.  All ratings were on CreditWatch with negative implications
at the time of suspension.

The lowering of the ratings on Krayinvestbank reflects S&P's view
that it may have difficulty complying with regulatory
requirements for capital adequacy, given its apparent failure to
publish relevant financials and reporting forms in full on the
Central Bank of Russia's website as of Dec. 1, 2015.  S&P has
consequently lowered its assessment of Krayinvestbank's stand-
alone credit profile to 'ccc+' from 'b-', indicating S&P's view
that regulatory intervention could occur without near-term
external support.

OFAC's naming of Krayinvestbank as a "specially designated
national" aside, S&P nevertheless considers the probability of a
Krayinvestbank default in the next 12 months as relatively low
and expect that it may receive necessary support in the near-term
that could help it avoid default.  As such, S&P has limited its
negative rating action to a one-notch downgrade to 'B-'.  S&P
considers, however, that there is uncertainty and continue to
believe that Krayinvestbank's capitalization going forward will
largely depend on its exposure to a court decision on the
ownership title of certain land plots in the city of Krasnodar.
S&P has therefore maintained the CreditWatch with negative
implications on its ratings on Krayinvestbank at the time of

S&P suspended its ratings on Krayinvestbank because of
Krayinvestbank being listed as a "specially designated national"
by OFAC.

S&P will consider reinstating the ratings on Krayinvestbank if
the OFAC sanctions are lifted, all else being equal.

ROSAGROLEASING JSC: Fitch Affirms 'BB' IDR, Outlook Negative
Fitch Ratings has affirmed JSC Rosagroleasing's (RAL) Long-term
Issuer Default Rating at 'BB' with a Negative Outlook.


RAL's ratings are driven by potential state support.  In
assessing potential support, Fitch views positively: (i) RAL's
100% state ownership and track record of past equity injections;
(ii) low cost of potential support given the company's small size
and leverage (iii) the company's role (albeit somewhat limited)
in the execution of state programs to support the agriculture

At the same time, the two-notch difference between the company's
Long-term IDR and those of the Russian sovereign (BBB-/Negative)
reflects RALs (i) lower systemic importance and policy role
compared with bigger state banks, specifically Russian
Agricultural Bank (RusAg, BB+/Negative), in supporting the
agricultural sector; (ii) potential weakening of support
propensity given the company's poor performance and previous
corporate governance flaws leading to large credit losses, as
well as potential further problems, which may require extra

RAL is a state-owned leasing company focusing on subsidized
directed leases to customers from the agricultural sector.
Ninety-four per cent of the portfolio at end-1H15 comprised
leases issued under the government sector support program and
funded by state capital injections with the remainder being
commercial leasing funded by bank loans (mainly VTB and RusAg).
The subsidized book has been stable in recent years, as the
company is using proceeds from lease repayments for issuance of
new leases, while the commercial book (and hence lending from
third parties) has been gradually decreasing.

Asset quality is weak mainly due to governance failings under
previous management prior to 2010, but also because of the
volatile performance of the agriculture industry.  At end-2014,
53% of net investments in lease were non-performing and reserved
by only 45%.  In addition RUB15.1 billion of lease receivables
were problematic, although these were reserved by 93%, and
RUB14.7 billion of other assets (advances paid and equipment)
were potentially at risk but these were reserved by 46% at end-

The aggregate unreserved portion of NPLs and other high-
risk/problematic exposures amounted to RUB24.6 bil. or 45% of
equity.  Given the company's low leverage (debt-to equity ratio
of 11% at end-2014), it has the capacity to comfortably reserve
these.  However, the newly issued leases are not yet seasoned and
may be a source of additional risks.

The lack of growth and capital contributions reflects RAL's
legacy problems and its niche role, although the company is still
included in the state program of agricultural development for
2013-2020.  Also the head of Ministry of Agriculture is planning
to head the Board of Directors of RAL in 2016.  RAL expects
RUB2bn equity injection in 2016, which will be used for new


The ratings could be downgraded if (i) Russia's sovereign ratings
are downgraded; (ii) RAL's policy role is diminished; (iii) the
company's leverage increases markedly; or (iv) the company's
governance continues to fail.

Potential for an upgrade is limited unless the company sees a
marked strengthening of its policy role, state support and its
corporate governance framework.


The Stable Outlooks on the National Rating reflect Fitch's view
that the creditworthiness of RAL relative to other Russian
issuers are unlikely to change significantly in case of a
sovereign downgrade.

The rating actions are:

  Long-term foreign currency IDR: affirmed at 'BB'; Outlook

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

  National Long-term rating: affirmed at 'AA(rus)'; Outlook

  Support Rating: affirmed at '3'

  Support Rating Floor: affirmed at 'BB'

SAMRUK-ENERGY: Fitch Affirms 'BB+' Senior Unsecured Rating
Fitch Ratings has affirmed Kazakhstan-based JSC Samruk-Energy's
ratings, including its Long-term Foreign-Currency Issuer Default
Rating of 'BBB-', and foreign-currency senior unsecured rating of
'BB+'.  The Outlooks on the long-term ratings are Stable.

The affirmation reflects strong strategic and operational ties
with the Kazakh state and Fitch's expectation that the government
would provide timely support to Samruk-Energy to meet and service
its liabilities, if required.  Fitch expects the company's
standalone credit profile to be under pressure from substantial
capex, continued tenge depreciation and potentially adverse
tariff developments.


Top-Down Minus Two Notches

Fitch applies a two-notch differential between the rating of
Samruk-Energy and the state (BBB+/Stable).  Fitch continues to
view the operational and strategic links between Samruk-Energy
and ultimately the state as strong, which supports the
application of the top-down rating approach.  The strength of the
ties is underpinned by the company's strategic importance to the
Kazakh economy as the company controls about 38% of total
installed electricity generation capacity and 36% of total coal
output in the country.  The strength of ties is also supported by
the state's approval of the company's strategy and capex program,
and by tangible financial support in the form of equity
injections, asset contributions, subordinated loans and

The government demonstrated its support in November 2015.  Wholly
state-owned sovereign wealth fund Samruk-Kazyna (BBB+/Stable)
reduced the interest rate on the KZT100 billion loan it provides
to Samruk-Energy from 9% to 1%.  The loan will also be
subordinated to all other unsecured obligations of Samruk-Energy.
This measure will help the company meet the 5.0x debt/EBITDA
covenant set in the EBRD agreement at the end-2015 test date.
Fitch understands that Samruk-Kazyna is also considering the
possibility of converting the KZT100 billion loan into equity in
2016 as a measure of extraordinary support.

Tenge Depreciation Negative for Credit Metrics

The tenge depreciation by around 85% since August 2015 has had a
negative effect on the company's credit metrics, as around 40% of
its debt is denominated in US dollars and euros, with almost all
revenues generated in local currency.  Samruk-Energy does not
have any hedging mechanisms other than keeping a portion of its
cash in dollars (72% at end-November 2015).  The tenge is now
floating and the company plans to reduce its exposure to FX risk
by issuing tenge-denominated debt.

Tight Leverage Covenant

The company's debt/EBITDA covenant set in the loan agreement with
the EBRD is tight due to Samruk-Energy's weak financials.  The
bank has reset the covenant from 4.5x to 5.0x for 2015, which
Samruk-Energy expects to meet at end-2015.  Fitch expects
covenant pressure to persist in the following years.  This will
be more reflective of the company's standalone mid 'B' category
profile than of an investment-grade rating.

Potential Tariff Freeze

The introduction of the capacity market in Kazakhstan, initially
planned for 2016, was postponed until 2019 to ease the pressure
on industrial producers.  This adds uncertainty to the 2016-2019
tariff regulation as capacity payments were meant to supplement
wholesale electricity prices.  A freeze of generation tariffs for
Kazakhstan's northern zone is being considered by the
authorities. This would affect Samruk-Energy's largest operating
subsidiary Ekibastuz GRES-1 (BB+/Stable).  Fitch expects the
final tariff decisions and capex program to be approved by end-
2015 or early 2016.

The impact on Samruk-Energy's financial profile is unclear
because the tariff freeze may lead to higher price
competitiveness for producers and ultimately be compensated for
by higher generation volumes.  Fitch assumes 0% generation tariff
growth for 2016-2018 and lower capex spending in 2018-2019.

Asset Privatisation

Samruk-Energy is privatising its nine subsidiaries.  The company
has so far sold its 50% stake in Zhambylskaya GRES for KZT2.4
billion.  Under the state privatisation program, in 2016 the
company should sell its power distribution assets (MEDNC and VK
REK including supply company Shygysenergotrade), and a generation
power plant (Aktobe CHP).  It also plans to privatize one more
distribution company, Alatau Zharyk Company, power supply company
AlmatyEnergosbyt, Tegis Munay and the large Almaty generation
plant in 2H16-2017.  The company expects to use privatization
proceeds for a Eurobond repayment in December 2017.

The rating impact of asset privatization would depend on the sale
prices achieved.  Nine assets earmarked for privatization
contributed around 68% to revenue and 30% to EBITDA in 2014.
They had a relatively low debt burden of KZT14 bil.  Samruk-
Energy's profitability should improve after the disposals as it
will retain its highly profitable hydro power plants and
Ekibastuz GRES-1.  The leverage impact will be neutral if the
company achieves at least 50% of the expected price.

Ambitious Debt-Funded Capex

Samruk-Energy has a substantial capex program of KZT266 billion
for 2015-2018.  As a result, Fitch expects its free cash flow to
remain significantly negative for 2015-2018.  However, if the
tariffs for Samruk-Energy's generation subsidiaries are frozen
for 2016-2018 the government may revise the company's capex
program downward.

Weak Standalone Profile

Fitch views Samruk-Energy's standalone profile as commensurate
with the mid 'B' rating category, significantly below the
government-supported IDR.  The main constraints on its credit
profile are its operating and regulatory environment, with
exposure to FX resulting in weakening of its credit metrics.  In
view of the tenge depreciation, ambitious capex plans, 30%
dividend pay-out and a potential tariff freeze for 2016-2018,
Fitch expects Samruk-Energy's funds from operations (FFO)
adjusted gross leverage to remain at around 6.7x on average in
2015-2019, and its FFO fixed charge cover to deteriorate to below
3x by 2017.

Prior-Ranking Debt

The ratio of secured and prior-ranking debt at operating company
level is below Fitch's threshold of 2x of EBITDA, at around 1.8x
of the group's 2015 EBITDA projected by Fitch.  However, Fitch
continues to notch the foreign- and local-currency senior
unsecured ratings down by one level from Samruk-Energy's Long-
term Foreign- and Local-Currency IDRs, respectively, due to the
lack of clarity and consistency in its financial policy and group
debt management, and uncertainties associated with planned asset


Fitch's key assumptions in its rating case for Samruk-Energy

   -- 0% tariff growth for 2016-2018

   -- Electricity production to increase below GDP growth rate

   -- Inflation-driven cost increase (including coal)

   -- Interest rate of 1% for KZT100 bil. subordinated loan from

   -- 30% dividend payout ratio

   -- Part of capex postponed from 2016-2017 and higher than
      management forecasts for 2018-2019

   -- 40% haircut to expected proceeds from privatization of non-
      core subsidiaries in 2016

   -- second-wave privatization (Almaty power station and Alatau
      Zharyk Company) excluded from forecasts due to high level
      of uncertainty


Positive: Future developments that may, individually or
collectively, lead to positive rating action include:

   -- Positive sovereign rating action
   -- Strengthening of legal ties (eg state guarantees for a
      larger portion of the company's debt and/or cross default
   -- A clearly defined debt-management policy that provides for
      a centralized debt-management function, which would be
      positive for senior unsecured ratings

Negative: Future developments that may, individually or
collectively, lead to negative rating action include:

   -- Negative sovereign rating action
   -- Diminishing or irregular state support

Fitch outlined these sensitivities for the sovereign rating of
Kazakhstan, Samruk-Energy's ultimate parent, in its Rating Action
Commentary of Oct. 30, 2015:

These risk factors individually, or collectively, could trigger
negative rating action:

   -- Policy mismanagement and/or prolonged low oil prices
      leading to a weakening in the sovereign external balance
   -- Renewed weakness in the banking sector, which leads to
      contingent liabilities for the sovereign
   -- A political risk event

These factors, individually or collectively, could result in
positive rating action:

   -- Moves to strengthen monetary and exchange rate policy
   -- Steps to reduce the vulnerability of the public finances to
      future oil price shocks, for example by reducing the non-
      oil deficit, currently estimated at more than 9% of GDP
   -- Substantial improvements in governance and institutional


At end-November 2015 Samruk-Energy's available cash and cash
equivalents were KZT54 billion, comfortably covering December
2015 maturities of KZT10.1 billion.  Maturities in 2016 of
KZT52.5 billion would be covered by a mix of cash balances and
operating cash flow.  However, the investment program for 2016 is
not yet fully funded: around KZT17.7 billion of new debt would
need to be raised to cover planned projects.  The company's
USD500 million Eurobond matures in December 2017, and Samruk-
Energy is working on various refinancing strategies.

Almost all the group's cash position is held at domestic banks.
Although we believe the company's access to liquidity for daily
operations is likely to be adequate, its full access to all the
cash held at Kazakh banks may be limited.  Fitch therefore
focuses on gross leverage ratios in our analysis rather than net
figures. At end-November 2015, 60% of the group's cash was held
at the holding company level.


  Long-term Foreign-Currency IDR affirmed at 'BBB-'; Outlook

  Long-term Local-Currency IDR affirmed at 'BBB'; Outlook Stable

  Short-term Foreign-Currency IDR affirmed at 'F3';

  Long-term National Rating affirmed at 'AA+(kaz)'; Outlook

  Foreign-currency senior unsecured rating affirmed at 'BB+'

  Local-currency senior unsecured rating assigned at 'BBB-'

  National senior unsecured rating assigned at 'AA(kaz)'

SECOND GENERATING: Fitch Assigns 'BB' Rating to RUB10BB Bonds
Fitch Ratings has assigned Russia-based electricity generator
Public Joint-Stock Company The Second Generating Company of
Wholesale Power Market's (OGK-2) RUB10 billion 11.5% domestic
bonds due in 2020 a final local currency senior unsecured 'BB'

The rating is in line with OGK-2's Long-term local currency
Issuer Default Rating (IDR) of 'BB'/Stable, as the bonds
represent direct and unsecured obligations of the company.  The
proceeds of the bond are being used by the company for funding
its investment program, refinancing and general corporate needs.

The 'BB' rating incorporates a one-notch uplift to the company's
'BB-' standalone rating for parental support from the ultimate
majority shareholder, PAO Gazprom (BBB-/Negative).  Its
standalone rating is underpinned by the company's position as one
of the largest power generators in Russia and cash flow
generation from capacity sales under the Capacity Supply
Agreements (CSA).  Fitch expects the postponement of
commissioning of certain new units under the CSA and
therefore leverage metrics are unlikely to improve to below 4x
before end-2016.  The standalone rating is constrained by high
regulatory risk and the company's exposure to price and volume

The Stable Outlook reflects Fitch's view of the company's ability
to commission its new units and transfer the 420MW unit of
Serovskaya GRES to PJSC Inter RAO (BBB-/Negative), in line with
the updated schedule.


One-Notch Uplift for Parental Support

OGK-2's 'BB' IDR benefits from a one-notch uplift, reflecting
Fitch's view of likely support from PAO Gazprom, which indirectly
owns 77.24% of OGK-2 through OOO Gazprom Energoholding (GEH).
The strength of the ties is supported by OGK-2's integral role
within Gazprom's operations and its substantial share in GEH's

OGK-2's installed capacity covered about 48% of GEH's total
installed capacity at end-2014.  Its gas-fired power plants are
reliant on Gazprom's gas supplies, which accounted for 76%-92% of
the company's gas consumption over 2012-2014.  Additionally, 94%
of OGK-2's total outstanding debt at end-1H15 was loans from

Strong Market Position

The 'BB-' standalone rating is underpinned by the company's
market position as one of the largest power generating companies
in Russia covering 7% of Russia's installed capacity and
electricity generation in 2014.  The operation of multiple assets
should moderate the risk of cash flow volatility (i.e driven by
unexpected outage).  The company is mainly involved in the
production and sale of electricity on the wholesale market.  In
contrast to its large international peers that are involved in
various power generation types, OGK-2 is focused on thermal power


Similarly to rated Russian peers, capacity sales under the CSA -
which contributed 35%-40% to EBITDA over 2012-2014 - mitigate the
company's exposure to market risk, support stable cash flow
generation and enhance its business profile.  The company expects
the share of CSA sales to increase to 50%-55% of EBITDA over
2016-2020 once all new capacity under the CSA framework is
commissioned.  Fitch assumes that OGK-2 will commission new
capacities as per the revised schedule, including new units of
Ryazanskaya GRES from Jan. 1, 2016, and Troitskaya GRES and
Novocherkasskaya GRES from April 1, 2016.  According to the
company a new unit of Serovskaya GRES was commissioned on
Dec. 22, 2015.

Deleveraging Unlikely Before 2017

Fitch expects funds from operations (FFO) net adjusted leverage
to increase to above 7x in 2015 from 2.8x in 2014.  In addition
to high capex, the rating agency expects OGK-2's EBITDA margin to
weaken to 8% in 2015 due to the rise in fuel costs and decline in
revenue from electricity sales. The high leverage is also driven
by the acquisition of a 45.5046% share in OGK-Investproekt from
PJSC Mosenergo for RUB2.8 billion in December 2015 (previously
expected to be acquired in 1H16) plus outstanding debt of RUB11
billion to be consolidated in OGK-2's accounts at end-2015, and
additional external acquisition funding.  However, Fitch expects
that 2016 EBITDA will be boosted by the expected commissioning of
new units under the CSA with a combined capacity of 1,410MW in
January-April 2016 and the consolidation of OGK-Investproekt that
operate Cherepovetskaya GRES under the CSA.

The company expects to acquire the remaining 45% stake in
OGK-Investproekt for RUB2.8 billion in 1H16.

2015 Negative Free Cash Flow

Fitch expects OGK-2 to generate cash flow from operations of
RUB11.4 billion on average over 2015-2018 following commissioning
of new capacity under the CSA, which stipulated that tariffs be
3.0x-3.5x higher on average than those for existing facilities.
However, Fitch expects negative free cash flow (FCF) in 2015 due
to ambitious investment plans of RUB23 billion  Fitch expects
OGK-2 to rely on new borrowings to finance cash shortfalls.  FCF
may turn positive in 2016 if the new 420MW unit at Serovskaya
GRES is transferred to Inter RAO and therefore will not require
any capex in 2016 and beyond.

Volume and Price Risk Exposure

OGK-2 generates most of its revenue from electricity and capacity
sale (about 70%) on the free market, exposing the company to
volume and price risks with the remaining sales from the
regulated market.  Price risk may be exacerbated by regulatory
changes affecting tariffs.  Fitch believes volumes and price
risks are moderated by cash low generation from new capacity
sales under the CSA given their favorable economics.

Unpredictable Regulatory Regime

Like other Russian utilities, OGK-2 is exposed to regulatory
risk, reflected in frequent modifications of the regulatory
regime and political interventions.  Guaranteed payments under
the CSAs are currently considerably higher than capacity payments
for the old capacity, although they have not been significantly
altered so far.  Any significant revision of the CSAs will weigh
heavily on utilities' financial profiles and increase cash flow
risk.  Fitch's projections for OGK-2 are based on the assumption
that the fundamentals of the CSA framework will remain unchanged.


Fitch's key assumptions within its rating case for the issuer

   -- Domestic GDP decline of 4% and inflation of 15.5% in 2015.

   -- GDP growth of 0.5% and CPI of 9% in 2016

   -- Electricity consumption to decline slower than GDP
      contraction in 2015

   -- Electricity tariffs to increase below inflation

   -- Inflation-driven gas price increase

   -- Capital expenditure in line with management's expectations

   -- Acquisition of a 45.5046% share in OGK-Investproekt from
      PJSC Mosenergo for RUB2.8bn in December 2015 and the
      remaining 45% stake for RUB2.8bn in 1H16

   -- Dividend payments of 15%-20% of IFRS net income over 2016-

   -- Penalties for later commissioning of power units to be paid
      over November 2017-2019


Positive: Future developments that may, individually or
collectively, lead to positive rating action include:

   -- Improvement in financial profile due to, among other
      things, higher-than-expected growth in tariffs and/or
      volumes supporting FFO net adjusted leverage below 3x and
      FFO interest coverage above 6.5x on a sustained basis.

   -- Stronger parental support.

   -- Increased predictability of the regulatory and operational
      framework in Russia.

Negative: Future developments that may, individually or
collectively, lead to negative rating action include:

   -- Inability to improve credit metrics such that FFO net
      adjusted leverage remains above 4x and FFO interest
      coverage stays below 3x on a sustained basis due to, among
      other factors, failure to commence operations at the new
      units in line with schedule, lower volumes of electricity
      and capacity sales, lower tariffs or margin squeeze driven
      by the rise of fuel prices not fully compensated by
      electric prices growth, weak working capital management,
      M&A transaction resulting in higher debt and/or intensive
      capex program.

   -- Weakening of parental support, which may result in a
      removal of the one-notch uplift to OGK-2's standalone

   -- Deterioration of the regulatory and operational environment
      in Russia.


Fitch assesses OGK-2's liquidity as manageable within the Gazprom
group.  At end-1H15 OGK-2's cash and cash equivalents were
RUB6.7 billion, sufficient to cover upcoming short-term debt
maturities of RUB6.6 billion.  The majority of debt at end-1H15
(about 94%) was capex-related loans from Gazprom.  OGK-2 has
access to uncommitted credit lines of RUB24 billion due over
2015-2020, mainly from major Russian banks.  OGK-2's investment
program has limited flexibility which increases short-term
funding needs.

FX exposure is limited to capex projects that contain a foreign
currency component.  The company estimates that RUB5.8 billion of
capex over 2015-2016 relating to purchases of equipment are
denominated in foreign currencies or 14% of total capex.  At end-
1H15 OGK-2 held a portion of cash in US dollars (about


  Long-term foreign currency IDR: 'BB', Outlook Stable

  Long-term local currency IDR: 'BB', Outlook Stable

  Short-term foreign currency IDR: 'B'

  Short-term local currency IDR: 'B'

  National Long-term Rating: 'AA-(rus)', Outlook Stable

  Local currency senior unsecured rating: 'BB'

VNESHECONOMBANK: Moody's Affirms Ba1 Ratings, Outlook Negative
Moody's Investors Service has affirmed Vnesheconombank's (VEB,
Russia) Ba1 local and foreign currency long-term issuer ratings
and its Not Prime local and foreign currency short-term issuer
ratings.  All long-term ratings have a negative outlook.

At the same time, the rating agency downgraded to b3 from b1 the
VEB's baseline credit assessment (BCA) as a result of VEB's
deteriorating standalone credit metrics amidst the volatile
operating environment in Russia.


The issuer rating affirmation reflects Moody's expectations that
VEB will retain its position of one of the Russian government's
core assets, and that therefore the probability of support is
very high, resulting in the issuer ratings of Ba1, in line with
the Russian government.  These support assumptions take into
consideration VEB's exclusive role as an operative arm of the
government and a fully government-owned development financial
institution, largely viewed as a part of the "enlarged"
government.  VEB is also closely supervised by the government,
which gives VEB good access to state funding and capital when
these are needed to finance various projects of government

At the same time, the BCA downgrade primarily reflects the fact
that, over past two years, VEB's credit profile has materially
deteriorated, largely reflecting the impairment of its
government-directed project finance loans, particularly related
to the 2014 Winter Olympics and Ukrainian enterprises.

VEB Group's problem loans/gross loans ratio (including impaired
but not overdue loans) increased to 39.3% as of end-2014 compared
with 19.7% as of end-2013.  Moody's estimates that the bank has
already recognized a substantial portion of these problem loans
and therefore further growth of problem loans should be
contained. However, VEB remains highly exposed to single-name
concentration risk and risks associated with its subsidiaries,
particularly the Russian banks bailed out in 2008-09 and
Prominvestbank in Ukraine.

Moody's notes that VEB's profitability metrics have substantially
deteriorated, as reflected in its return on average assets (RoAA)
ratio of -3.7% in the first half of 2015, following RoAA of -7.2%
posted in 2014.  These losses were largely driven by high
provisioning charges related to aforementioned project finance
loans.  At the same time, its net interest margin declined to
1.9% in H1 2015 relative to 2.7% in 2014, which reflected growing
funding costs and an increasing problem loans.

Moody's anticipates some improvements in VEB's core profitability
metrics following a normalization of Russian financial market
conditions and gradual stabilization of problem loan levels.
Nevertheless, VEB will not achieve breakeven over next 12-18
months due to still high provisioning charges and weak core
profitability metrics.

VEB's standalone credit worthiness is also supported by its
capital levels, which have historically been maintained by the
government.  VEB's statutory capital ratio (N1.0) was 12.4% as of
H1 2015, which was higher than the regulatory minimum of 10%,
which VEB has to respect due to its Eurobond covenant.  Moody's
notes that the government's regular capital injections have
totalled around RUB559 billion in Tier 1 capital and $6 billion
in Tier 2 capital since 2007.  However, future capital increases
may come in a less tangible form, e.g. via the provision of
cheaper funding resulting in a fair value gain under IFRS, rather
than through paid-up capital.


The negative outlook on VEB's issuer ratings reflects current
uncertainty with regard to VEB's future business model.
According to VEB's management, the Russian government is
currently considering a package of new support measures aimed to
promote VEB's specialization as the development institution and
to clean up its balance sheet from accumulated toxic assets.


Given the positioning of VEB's long-term deposit ratings at the
same level as the sovereign bond rating, an upgrade is unlikely
in the absence of any change in the sovereign rating.

Stabilization of the rating outlook will depend on the
government's decisions regarding further support to VEB and
potential changes in its business model, as well as on
substantial improvements in its standalone credit profile.

VEB's ratings could be downgraded in the event of (1) any
reduction in the probability of government support for VEB, in
Moody's view, e.g. resulting from the government's anticipated
plan to rebalance VEB's business model and/or its group
structure; (2) a deterioration in the government's own
creditworthiness; and (3) further substantial deterioration of
its standalone credit profile, including any material increase in
problem loans and erosion of its capital buffers.

* Fitch Predicts Negative Outlook for CIS Utilities in 2016
Fitch Ratings says in a new report that the negative sector
outlook for CIS utilities in 2016 reflects their continued
exposure to weaknesses in their respective economies and
regulatory uncertainties.

The Negative Outlook on most CIS utilities' ratings is mostly
driven by the weakening legal links with the parent as well as
weakening standalone profiles of rated names as a result of local
currency depreciation.  Extensive capex programs, which are
mostly debt-funded, could face funding challenges within the
current market conditions.

Fitch views the liquidity position of most CIS utilities as weak,
as their cash position is not sufficient to cover short-term
maturities, especially after recent local currency depreciation
in Kazakhstan and Azerbaijan.


PROCREDIT BANK: Fitch Revises Outlook to Pos. & Affirms 'B+' IDR
Fitch Ratings has revised ProCredit Bank ad Beograd's (PCBS)
Outlook to Positive from Stable.  At the same time, Fitch has
affirmed its Long-term foreign and local currency Issuer Default
Ratings at 'B+' and 'BB-', respectively.

The Support Rating is affirmed at '4'.  The 'b+' Viability Rating
of PCBS was not affected by this rating action.

The rating action follows Fitch's revision of the Outlook on
Serbian sovereign rating.


PCBS's IDRs and Support Rating are driven by potential support
from its parent, ProCredit Holding AG & Co. KGaA (PCH,
BBB/Stable).  However, the Long-term foreign currency IDR is
constrained by Serbia's Country Ceiling of 'B+' reflecting
potential transfer and convertibility risks.  The one-notch
uplift of PCBS's local currency IDR above both the Country
Ceiling and the bank's foreign currency IDR reflects a lower
probability of restrictions being placed on servicing of local
currency obligations in case of systemic stress.

The Positive Outlook on PCBS's Long-term IDRs reflects that on
Serbia's Long-term foreign and local currency IDRs, and therefore
the potential for the bank's ratings to be upgraded if the
country's ratings are upgraded and the Country Ceiling is revised

PCBS's IDRs and Support Rating are driven by potential support
from PCH.  The support considerations take into account the 100%
ownership, common branding, close parental integration and a
track record of timely capital and liquidity support to group
banks from PCH.  Absent of Country Ceiling constraints, these
considerations would typically be reflected in a one-notch
differential between the rating of the parent, PCH, and that of

PCH's ratings are based on Fitch's view of the support it could
expect to receive from its core international financial
institution (IFI) shareholders when needed.  Fitch's view of
support is based on PCH's ownership, effective corporate
governance and the important and successful development role it
fulfills in advancing responsible financing and small business
lending in developing markets.  This mission is in keeping with
the developmental mandates of the core shareholders.


Movements in Serbia's sovereign rating, accompanied by a change
in the Country Ceiling, are likely to affect PCBS's IDRs.  An
upgrade of Serbian sovereign rating is likely to result in an
upgrade of the Support Rating for PCBS.

The rating actions are:

  Long-term foreign currency IDR: affirmed at 'B+'; Outlook
   revised to Positive from Stable

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

  Long-term local currency IDR: affirmed at 'BB-' Outlook revised
   to Positive from Stable

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

  Viability Rating: unaffected at 'b+'

  Support Rating: affirmed at '4'

TRANSAERO AIRLINES: Sues Rosaviation Over License Revocation
RAPSI reports that Transaero filed a lawsuit within the Moscow
Commercial Court against the Federal agency of air transport
(Rosaviation) demanding RUR25.3 million (US$358,000).

Earlier, Transaero asked the court to declare Rosaviation's
decision to revoke airline's certificate illegal, RAPSI relates.
Lawsuit reached the court on Dec. 15, preliminary hearings are
scheduled on Jan. 27, RAPSI discloses.

Transaero found itself unable to pay its debts estimating RUR250
billion (US$4 billion), RAPSI relays.  Government-approved plan
of transferring 75% of company's shares to Aeroflot failed, RAPSI
relates.  Its problems resulted in a large number of flight
cancels and delays, RAPSI notes.

OJSC Transaero Airlines is a Russian airline with its head office
in Saint Petersburg.  It operates scheduled and charter flights
to 103 domestic and international destinations.

VELEFARM HOLDING: EUR54.2-Million Strada Suit Resolved
Reuters reports that Stada said on Dec. 18 it had resolved a
legal dispute with Serbian drug wholesale group Velefarm, with
both sides waiving claims against each other.

The insolvency administrator of Velefarm had sued Stada for
EUR54.2 million last year, demanding that certain agreements
reached in 2010 and 2011 between Stada and Velefarm to be
declared invalid, Reuters recalls.

Reuters says Velefarm in 2010 was no longer able to pay Stada in
Serbia, one of Stada's largest markets, which led to a debt
restructuring contract between the two sides.

According to Reuters, Stada said on Dec. 18 the insolvency
administrator had waived the EUR54.2 million claim. In return,
Stada subsidiary Hemofarm waived most of a single-digit million
euro claim against Velefarm, which Stada already fully impaired
in 2010.


CAJAMAR EMPRESAS 4: Fitch Raises Rating on Cl. B Notes to 'BB+sf'
Fitch Ratings has upgraded IM Cajamar Empresas 4, FTA's class B
notes and affirmed the class A notes as:

  Class A (ES0347454003): affirmed at 'A+sf'; Outlook Stable
  Class B (ES0347454011): upgraded to 'BB+sf' from 'B+sf';
  Outlook Positive

IM Cajamar Empresas 4 is a static, cash flow securitization of a
portfolio of secured and unsecured loans granted to Spanish self-
employed individuals and SMEs by Cajas Rurales Unidas, Sociedad
Cooperativa de Credito (formerly Cajamar Caja Rural, Sociedad
Cooperativa de Credito).


The upgrade of the class B notes reflects the stable performance
of the transaction over the last 12 months and increasing credit
enhancement due to deleveraging.  Credit enhancement of the class
B notes has increased to 27.4% at end-November 2015 from 18.8% at
end-October 2014.  Delinquencies have remained fairly stable over
the last 12 months, in line with Fitch's expectations.  Ninety-
day delinquencies have increased slightly to 1.46% at end-October
2015, from 1.22% at end-October 2014.

The affirmation of the class A notes reflects the increase of
credit enhancement to 88.3% at end-November 2015 from 60.3% at
end-October 2014, provided by overcollateralization and a fully
funded reserve fund of EUR94.5 mil.  The maximum achievable
rating for the class A notes is capped at 'A+sf' due to the
account bank trigger being set at 'BBB+'/'F2' in the transaction

Fitch considers the potential payment interruption that may arise
from the exposure to the servicer, Cajas Rurales Unidas, Sociedad
Cooperativa de Credito (BB-/Stable/B), to be sufficiently
mitigated by the liquidity provided by the fully funded cash
reserve.  The reserve fund provides liquidity to cover for
interest shortfall on the class A notes until they are completely
redeemed, and for the class B notes thereafter.

Current defaults have increased to 8.4% at end-October 2015 from
6.3% at end-October 2014, partially due to the amortization of
the portfolio.  However, the weighted average recovery rate has
increased considerably to 23.7% from 8.4% during the same period
and Fitch expects this trend to continue in line with the
standard recovery lag in Spain.

Top 10 obligors account for 7% of the outstanding balance and
around 50% of the current collateral is located in the region of
Andalusia.  This concentration risk is addressed in Fitch's


Rating sensitivity to increased default rate (DR) assumptions
  Class A and B notes
  Increase DR base case by 15%: 'A+sf'/'BBsf'
  Increase DR base case by 25%: 'A+sf'/'B+sf'

Rating sensitivity to reduced recovery rate (RR) assumptions
  Class A and B notes
  Reduce RR base case by 25%: 'A+sf'/'BBsf'

Combined rating sensitivity to increased DR and reduced RR
  Class A and B notes
  Increase DR and reduce RR base case by 20%: 'A+sf'/'B+sf'


No third party due diligence was provided or reviewed in relation
to this rating action.


Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset
pool and the transaction.  There were no findings that were
material to this analysis.  Fitch has not reviewed the results of
any third party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing

Prior to the transaction closing, Fitch reviewed the results of a
third party assessment conducted on the asset portfolio
information, which indicated no adverse findings material to the
rating analysis.

Overall, Fitch's assessment of the information relied upon for
the agency's rating analysis according to its applicable rating
methodologies indicates that it is adequately reliable.

INSTITUT CATALA: Fitch Rates EUR200MM Pagares Program 'BB'
Fitch Ratings has assigned Institut Catala de Finances' (ICF)
EUR200 million Pagares program a Long-term rating of 'BB' and a
Short-term rating of 'B'.

The Pagares program (Spanish commercial paper) will be used for
liquidity purposes and notes issued under the program will
constitute direct, senior unsecured obligations of the ICF.


ICF's ratings mirror those of the Autonomous Community of
Catalonia (BB/Negative/B), based on the explicit statutory
guarantee from Catalonia following the regional Decree Law
4/2002, as amended on July 29, 2011.  The ratings of ICF are
therefore linked to the ratings of Catalonia, and ICF is
classified by Fitch as a credit-linked public sector entity.

In line with Fitch's criteria, the program is rated at the same
level as ICF's Long-term Issuer Default Ratings (IDR) of 'BB' and
Short-term IDR of 'B'.

The program was launched in 2015 for the third consecutive year
and has a 12-month validity.  Issues under the program may have
90 to 730 days maturities, and are issued at a discount.  Apart
from the statutory guarantee, Fitch views ICF's liquidity as
sufficient for the redemption of the program, at close to 2.7x of
the maximum EUR200 million authorized principal amount of the
program at end-2014.


A change in the ratings of the Autonomous Community of Catalonia
would be mirrored in the ratings of ICF, and in turn on the
ratings of the program or issues under the program.  Moreover, a
significant deterioration of ICF's liquidity will also result in
a negative rating action on the program's rating.


BANK SOFIYSKIY: Declared Insolvent by National Bank of Ukraine
The Board of the National Bank of Ukraine adopted a decision to
declare Bank SOFIYSKIY PJSC insolvent and issued Resolution No.
916, dated Dec. 22, 2015, to this effect.

"Historically, the Bank operated in Donetsk. Following the launch
of the anti-terrorist operation, the Bank moved to Kyiv. However,
the bulk of the bank's entire loan portfolio is concentrated in
the ATO area. The developments in Eastern Ukraine led to a
deterioration in the servicing of loans, triggering liquidity
problems. The bank's owners and management tried to rescue the
Bank by searching for an investor.

"In search of an alternative source of income, the Bank recently
focused on establishing branch offices specialized in retail
currency exchange operations. However, given the shortage of
liquidity, this option failed to achieve positive results. The
search for investors who could provide financial support to the
Bank has not yielded the desired result either. As a result, the
Bank has been this driven into insolvency," said Director of the
Banking Supervision Department Kateryna Rozhkova.

Data from the Bank's statistical reports suggest that Bank
SOFIYSKIY PJSC experienced a shortage of funds required to meet
its obligations to depositors and creditors. As of Dec. 9, 2015,
the Bank's total outstanding obligations amounted to
UAH32.1 million, or 5.3% of the total obligations.

The Bank's qualifying shareholders failed to take timely measures
to provide sufficient funding to the Bank and prevent it from
slipping into insolvency. Pursuant to paragraph 3 of the first
part of Article 76 of the Law of Ukraine On Banks and Banking,
the NBU is obliged to declare a bank insolvent if the bank has
failed to fulfill two or more percent of its obligations to
customers and other creditors over five consecutive business

KYIV CITY: Fitch Raises Issuer Default Rating to 'CCC'
Fitch Ratings has upgraded the City of Kyiv's Long-Term Foreign
Currency Issuer Default Rating to 'CCC' from 'D'.

Under EU credit rating agency (CRA) regulation, the publication
of Sovereign reviews (including Local and Regional Governments)
is subject to restrictions and must take place according to a
published schedule, except where it is necessary for CRAs to
deviate from this in order to comply with their legal

Fitch interprets this provision as allowing the rating agency to
publish a rating review in situations where there is a material
change in the creditworthiness of the issuer that Fitch believes
makes it inappropriate for us to wait until the next scheduled
review date to update the rating or Outlook/Watch status.

The next scheduled review date for the City of Kyiv was 18 March
2016.  However, in this case the deviation was caused by the
completion of exchange execution on distressed Eurobonds of the


These are the key drivers for the rating action and their
relative weights:


The upgrade of Kyiv's Long-Term Foreign currency IDR follows the
completion of Kyiv's distressed debt exchange (DDE) on Dec. 22,
2015.  The city's ratings' upgrade reflects lowered debt burden,
relived refinancing pressure and satisfactory fiscal performance.

Fitch treats completion of the city of Kyiv's USD550 million
Eurobond restructuring as an executed exchange in accordance with
its DDE criteria, leading to today's upgrade of the city's

The agreed terms of restructuring in our view materially reduce
investors' compensation.  It includes a 25% reduction on the
bond's principal, interest was cut to 7.75% and maturities
extended to 2019 and 2020.  According to original schedule Kyiv's
USD250 million Eurobond final maturity was Nov. 6, 2015, and its
USD300 million Eurobond July 11, 2016.

As the new Eurobonds will be issued by Ministry of Finance of
Ukraine, which will be liable for this debt repayment, Fitch
withdraw senior debt ratings of Kyiv's distressed Eurobonds.
Prior to that, national parliament granted the city the right to
suspend the repayment of its Eurobonds in May 2015.  Kyiv was
mandated to extend the maturity of its external debt as part of a
broader exercise to support Ukraine's public sector finances and
external liquidity following the introduction of the IMF's
Extended Fund Facility for Ukraine in March 2015.

Fitch has also upgraded the city's Local-Currency IDR to 'CCC'
from 'D' following restructuring of its domestic bonds.  Kyiv has
extended the maturities of its domestic bonds by 12 months, from
the original maturities of Oct. 1 and Dec. 7, 2015.  The city's
decision to extend maturities was approved by the national
government and the restructuring did not involve a write-down of
principal or a decrease in coupons.


Fitch expects Kyiv's budgetary performance to remain volatile due
to overall weakness of sovereign public finances, lower
predictability of fiscal policy and short planning horizon,
exacerbated by negative macro-economic trend.  Fitch expects
contraction in Ukraine's economy by 11.6% yoy in 2015, which
negatively affects the city's fiscal capacity.


Any adverse change affecting the city's ability and capacity to
refinance or repay its domestic bonds would lead to a downgrade.

Material reduction in refinancing pressure along with sustainable
restoration of the city's financial flexibility would lead to an

The rating actions are:

   -- Long-Term Foreign Currency IDR: upgraded to 'CCC' from 'D'

   -- Long-Term Local Currency IDR: upgraded to 'CCC' from 'D'

   -- National Long-Term Rating: upgraded to 'BBB(ukr)'/Stable
      from 'D(ukr)'

   -- Senior unsecured Eurobonds (ISIN XS0233620235/US225407AA34
      and XS0644750027/ US50154TAA34): withdrawn

   -- Senior unsecured domestic bonds: upgraded to 'CCC' from 'D'

   -- Senior unsecured domestic bonds: upgraded to 'BBB(ukr)'
      from 'D(ukr)'

U N I T E D   K I N G D O M

ACE TELECOM: Directors Banned Over Multi-Million Pound VAT Scam
The directors of a company involved in deals traced back to
fraudulent tax losses of over GBP13 million have been
disqualified from acting as directors for a total of 34 and a
half years, following an investigation by the Insolvency Service.

Neil Arthur Pursell (aged 51) of Stoke-on-Trent, Adrian John
Sumnall (45) of Market Drayton, Shropshire and James Elphinstone
Reed (45) of Tarporley, Cheshire all directors of Ace Telecom
Trading Limited (ATT) all gave disqualification undertakings to
the Secretary of State for Business, Innovation and Skills (BIS)
not to promote, manage, or be a director of a limited company
until 2026.

The undertakings given by Messrs. Pursell and Sumnall followed
court proceedings commenced by the Official Receiver.

ATT, which traded as a wholesaler of mobile telephones and other
electronic goods, was wound-up by the Court on 8 July 2013 owing
more than GBP18 million to HM Revenue and Customs (HMRC) and with
an estimated total deficiency to creditors of GBP32 million.

In giving the undertakings, Pursell, Sumnall and Reed did not
dispute that they caused or allowed ATT to participate in
transactions which were connected to the fraudulent evasion of
VAT, which they either knew or should have known about, and that
ATT wrongfully claimed VAT from HMRC totalling almost GBP14

Messrs. Pursell and Sumnall were also directors of Winnington
Networks Limited (Winnington), which was placed in to Provisional
Liquidation on the application of HMRC in March 2014, after the
Court was satisfied that Winnington was involved in fictitious
trading connected to a complex VAT fraud. Winnington was
subsequently wound up with tax debts of approximately GBP6

Commenting on the disqualifications, Ken Beasley, Official
Receiver at the Insolvency Service's Public Interest Unit, said:

"The directors of Ace Telecom Trading Limited were well aware of
the risks of VAT fraud but nonetheless the company entered into
transactions linked to the fraudulent evasion of VAT and
wrongfully reclaimed VAT input tax of almost GBP14 million."

VAT fraud represents a pernicious attack on the public finances
and the periods of disqualification reflect the serious view
taken of the conduct of the directors in this case.

The Insolvency Service will not hesitate to use its enforcement
powers to disqualify directors involved in schemes aimed at
defrauding HMRC.

Ace Telecom Trading Ltd was incorporated on Aug. 14, 2000, with
registered number 04052361. The company's registered office was
The Meridian, 4 Copthall House, Station Square, Coventry CV1 2FT
and the main trading address 33 Lawton Street, Congleton,
Cheshire CW12 1RU.

The petition to wind up ATT was presented by HMRC on May 22,
2013. The winding up order against ATT was made on July 8, 2013.
There were no known assets and an estimated deficiency to
creditors of GBP32,445,895. The issued and paid up share capital
was GBP3.00 giving an overall deficiency as regards creditors and
members of GBP32,445,898.

On June 18, 2015, the Secretary of State accepted a
disqualification undertaking from James Elphinstone Reed for a
period of 10 years and 6 months. The period of disqualification
commenced on July 9, 2015. His date of birth is Sept. 9, 1970.

On Aug. 18, 2015 the Secretary of State accepted a
disqualification undertaking from Adrian John Sumnall for a
period of 12 years. The period of disqualification commenced on
Sept. 8, 2015.

On Nov. 10, 2015 the Secretary of State accepted a
disqualification undertaking from Neil Arthur Pursell for a
period of 12 years. The period of disqualification commences on
Dec. 1, 2015.

Messrs. Pursell and Reed were also both directors of Winnington
Networks Limited. Winnington was placed in to Provisional
Liquidation on March 19, 2014, and subsequently wound up by the
Court on April 28, 2014. Winnington's registered office was
situated at Richmond House, 570-572 Etruria Road, Basford,
Newcastle-under-Lyme, Staffordshire ST5 0SU.

MARKETING AND LEAD: Debt Management Company Director Banned
Andrew Alan Dunn, director of failed debt management company
Marketing and Lead Generation Limited (MLG), which traded as One
Debt Solution offering debt management services to people
suffering from financial problems, has been disqualified for
misleading customers and for declaring a GBP330,000 dividend to
shareholders when customers' complaints were under review.

The disqualification follows an investigation by the Insolvency

Mr. Dunn (42) of Hagley, Stourbridge, gave an undertaking to the
Secretary of State for Business, Innovation & Skills, which
prevents him from acting as a director of a company for 11 years
from December 10, 2015.

The Insolvency Service's investigations found that persistent
complaints were made by customers between 2010 and 2013 about
MLG's failure to pay over money intended for their creditors, and
that the independent adjudicator who reviewed the complaints
decided that the customers had been misled and should receive

In February 2013, at a time when customers' complaints were still
under review, MLG declared a GBP330,000 dividend to its parent
company, of which Mr. Dunn was himself a shareholder. On December
9, 2013, MLG went into liquidation owing debts of over GBP450,000
to customers.

Commenting on the disqualifications, Susan Macleod, Chief
Investigator at the Insolvency Service, said:

"This company derived its income from people who were struggling
financially and who had turned to it for help to sort out their
debt problems. The director failed to pay due regard to the
interests of these already vulnerable people and caused the
company to carry on with misleading business practices despite
persistent complaints and warnings.

"This disqualification should serve as a warning that if
directors behave in this way their conduct will be investigated
and they will be removed from the business environment."

Marketing And Lead Generation Ltd was incorporated on June 22,
2006. It was originally called Neo Media Solutions Limited and
changed its name to its current form on 2 April 2013.

The company latterly traded from Pioneer House, Birmingham
Street, Halesowen B63 3HN. The company provided debt management
services from 2009 to 2013 under the trading name One Debt
Solution. The company also used the trading name Neo Media
Solutions from 2006 to 2013, as a provider of business to
business sales leads, and the name NM Claims from 2010 to 2013,
as a claims management service provider.

Andrew Alan Dunn was a recorded director from April 7, 2008 to
April 30, 2009, and again from March 1, 2012 onwards. Although Mr
Dunn is recorded as having resigned as a director on April 30,
2009 and having been reappointed on March 1, 2012, he acted as
director of the company from June 1, 2009 onwards.

The company went into creditors' voluntary liquidation on Dec. 9,
2013. Its assets totalled GBP15,477 and its liabilities totalled

RENEWABLE ENERGY: To Start Insolvency Process Early in 2016
Hana Stewart-Smith at Alliance News reports that Renewable Energy
Holdings PLC said that it is likely to begin insolvency
proceedings in the first quarter of 2016, following a decision by
the UK government in November to reject its application to
construct a wind farm in Wales.

According to the report, the company has agreed an extension on
the maturity dates of its loan with Utilico Investments Ltd to
the end of March from the end of December.  Alliance News relates
that Renewable Energy Holdings said the purpose of the extension
was to allow it time to lodge an application for a judicial
review of the Secretary of State's decision to refuse consent for
the Mynydd y Gwynt wind farm.

Additionally, the company said that it is continuing talks with
Utilico to discuss whether or not it "can or should" remain
trading in light of the rejection of the wind farm, the report

Shares in Renewable Energy Holdings remain suspended, adds
Alliance News.


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.

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, and Peter A. Chapman,

Copyright 2015.  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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