TCREUR_Public/160121.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Thursday, January 21, 2016, Vol. 17, No. 014


                            Headlines


C Y P R U S

PRIMORSK INTERNATIONAL: Files for Chapter Bankruptcy Protection


F R A N C E

* FRANCE: Insolvencies Rise to 63,081 in 2015, Altares Says


H U N G A R Y

QUAESTOR ERTEKPAPIR: Liquidator Puts BSE Stake Up for Sale


G E R M A N Y

KLOECKNER & CO: Moody's Withdraws B1 Corporate Family Rating
KLOECKNER & CO: S&P Affirms 'B' CCR, Then Withdraws Rating


I C E L A N D

LANDSVIRKJUN: S&P Raises ICR to From BB+, Outlook Stable


I T A L Y

CECCHI GORI: Cal. App. Affirms $5K Sanctions Against Founder


K A Z A K H S T A N

KAZKOMMERTSBANK: Fitch Cuts LT Issuer Default Ratings to 'CCC'


N O R W A Y

HAVILA SHIPPING: Fails to Get Bondholder Support for Debt Plan


R U S S I A

NOVIKOMBANK JSC: Fitch Cuts FC Issuer Default Rating to 'B-'
SVYAZNOY BANK: Declared Bankrupt by Moscow Arbitration Court


S P A I N

ABENGOA SA: Wind Power Companies May Take Over Brazil Projects


U N I T E D   K I N G D O M

ARBOUR CLO III: Fitch Assigns 'BB(EXP)sf' Rating to Cl. F Notes
EASTERN CONTINENTAL: Chapter 15 Case Summary
SANTANDER UK: S&P Raises Rating on 3 Legacy Instruments to BB


X X X X X X X X

* S&P Raises Ratings on 7 Companies' Debt Instruments
* Katz Joins Fried Frank's Bankruptcy & Restructuring Practice


                            *********


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C Y P R U S
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PRIMORSK INTERNATIONAL: Files for Chapter Bankruptcy Protection
---------------------------------------------------------------
Patrick Fitzgerald at The Wall Street Journal reports that
Primorsk International Shipping Ltd. has filed for bankruptcy
protection after reaching the terms of a debt-for-equity swap with
bondholders.

According to the Journal, Holly Etlin, the company's chief
restructuring officer, in an affidavit filed on Jan. 17 with the
U.S. Bankruptcy Court in New York said the oil shipper, registered
in Cyprus, has been in talks with a group of Norwegian bondholders
on the terms of a debt restructuring for more than a year.

Primorsk has struggled in recent years after undertaking an
ill-timed expansion that loaded the company up with too much debt
at the same time when global markets crashed, significantly
reducing world trade, the Journal relays.  Since 2010, the company
has been selling vessels and repaying the debt it took a decade
ago, the Journal notes.

A group of senior bank lenders balked at the bondholder deal and
has demanded Primorsk sell its entire fleet of vessels, the
Journal discloses.  Last week, the lenders seized a Primorsk bank
account in London and demanded full payment of some US$262.2
million in loans, prompting the chapter 11 filing on Jan. 15, the
Journal recounts.

The shipper, which is profitable, and its bondholders say the
company is worth far more than the liquidation value of its fleet
if it can restructure its debt and revamp charter rates via its
bankruptcy case, the Journal relates.

"The restructuring would involve the conversion of all of the
outstanding Norwegian bonds into approximately 75% of the equity
of the reorganized debtors pursuant to a chapter 11 plan of
reorganization," the Journal quotes Ms. Etlin as saying.

Founded in 2004, Primorsk International Shipping Ltd. operates a
fleet of ice-class oil tankers in the Arctic.



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F R A N C E
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* FRANCE: Insolvencies Rise to 63,081 in 2015, Altares Says
-----------------------------------------------------------
Rudy Ruitenberg at Bloomberg News, citing data analysis firm
Altares, reports that insolvencies in France rose to 63,081 last
year from 62,586 in 2014, with receivership procedures and
bankruptcies rising.

According to Bloomberg, company failures threatened 235,000 direct
jobs, 10,000 less than in 2014.

Thierry Millon, director of studies at Altares, said payment
delays rose to a 10-year high in 2015, causing treasury crunch,
Bloomberg notes.

Receivership procedures rose 1.5% to 18,370 in 2015, while
judicial liquidations increased 0.7% to 43,178, Bloomberg
discloses.

The sector suffering the most was that of small companies in
business-to-consumer services including food retailers,
hairdressers, beauty salons, as well as health care and
recreational activities, Bloomberg states.

Insolvencies in construction fell 0.7% to 18,059, while business
failures in industrial manufacturing fell 1.2% to 4,412, Bloomberg
says.

Financial services and insurance-industry insolvencies fell 20% to
401, Bloomberg relays.

Mr. Millon, as cited by Bloomberg, said the outlook for 2016 is
favorable, with bankruptcies expected to fall at least 3%.



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H U N G A R Y
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QUAESTOR ERTEKPAPIR: Liquidator Puts BSE Stake Up for Sale
----------------------------------------------------------
MTI-Econews reports that a combined 1.9% stake in the Budapest
Stock Exchange owned by three independent brokerages that went
bust last year are being put up for sale by liquidator PSFN.

Offers for the shares may be made by February 3 and contracts of
the sale will be signed by February 22, MTI-Econews relays, citing
an announcement on PSFN's website.

The almost 103,000 shares are owned by Quaestor Ertekpapir,
Hungaria Ertekpapir and Buda-Cash, MTI-Econews discloses.



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


KLOECKNER & CO: Moody's Withdraws B1 Corporate Family Rating
------------------------------------------------------------
Moody's Investors Service has withdrawn Kloeckner & Co. SE.'s
Corporate Family Rating of B1, Probability of Default Rating of
B1-PD and negative outlook.

RATINGS RATIONALE

Moody's has withdrawn the rating for its own business reasons.


KLOECKNER & CO: S&P Affirms 'B' CCR, Then Withdraws Rating
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' long-term
corporate credit rating on German steel distributor Kloeckner &
Co. S.E. and then withdrew it at the issuer's request.  The
outlook at the time of withdrawal was stable.

The company repaid more than 85% of its EUR186 million convertible
bond in December, following the exercise of the investor put
option.  In line with conditions for early redemption, Kloeckner
chose to repay the remaining amount on Jan. 12, 2016.  The
repayment of the convertible bond with cash on the balance sheet
was in line with S&P's earlier expectations and was neutral for
the rating.



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I C E L A N D
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LANDSVIRKJUN: S&P Raises ICR to From BB+, Outlook Stable
--------------------------------------------------------
Standard & Poor's Ratings Services raised its long- and short-term
issuer credit ratings on Icelandic electricity generation and
transmission company Landsvirkjun to 'BBB-/A-3' from 'BB+/B'.  The
outlook is stable.

The upgrade follows S&P's upgrade of the Republic of Iceland.  It
reflects S&P's view that the ability of the sovereign to support
Landsvirkjun in case of financial stress has increased.  S&P
continues to assess Landsvirkjun as a government-related entity
that benefits from a very high likelihood of timely and sufficient
extraordinary government support if needed.  S&P bases this
assessment on Landsvirkjun's:

   -- Very important role for the Icelandic government, given its
      dominant position as the incumbent power company and 64.7%
      owner of the national transmission grid, its strategic
      importance to the Icelandic economy, and its central role
      in the promotion of power-intensive industries; and

   -- Very strong link with the Icelandic government, given the
      state's 100% ownership, S&P's expectation that the company
      will not be privatized over the next few years at least,
      and the risk to the sovereign's reputation if Landsvirkjun
      were to default.

S&P sees the potential for Landsvirkjun to demonstrate stronger
credit measures over the next couple of years if it maintains
modest spending levels.  This could lead S&P to revise upward its
stand-alone credit profile (SACP), which is currently 'b+'.

Landsvirkjun continues to benefit from its position as the
dominant power producer in Iceland, low-cost renewable-generation
assets, and long-term take-or-pay contracts.  Its business risk
profile remains constrained, however, by high customer and
geographic concentration and exposure to the aluminum sector for
revenue and cash flow generation (around 50% of power supply
contracts are linked to aluminum prices via contracts with
aluminum smelters).  S&P notes, however, that aluminum price risk
has reduced in the recent years following renegotiations of
existing contracts and new contracts linked to the consumer price
index. S&P assesses Landsvirkjun's business risk profile as fair.

The company's debt remains high, owing to material debt-funded
capital investments in the past that resulted in weak cash-flow
coverage ratios.  Although S&P forecasts a gradual improvement, it
believes that credit measures will remain commensurate with a
highly leveraged financial risk profile in the near term -- albeit
at the stronger end of the range for this category -- with
weighted-average funds from operations (FFO) to debt just below
12% and debt to EBITDA above 6x.

The SACP incorporates a one-notch upward adjustment under S&P's
positive comparable ratings analysis for the company.  This is
based on S&P's view that Landsvirkjun's FFO-to-debt ratio and
interest coverage are strong for S&P's highly leveraged financial
risk profile.  It also incorporates the ongoing support from the
Icelandic government (the owner), which has requested very modest
dividends from Landsvirkjun over the past few years.

Under S&P's base case, it assumes:

   -- EBITDA margins of about 75%-80% in 2015 and 2016, slightly
      lower than the margin of 80% in 2014.  Power prices will
      likely continue to bear the weight of low aluminum prices,
      mitigated by price hedges.  Volumes in 2015-2016 are
      expected to recover slightly compared with 2014.

   -- FFO well in excess of capital expenditures (capex) and
      dividends, leading to further debt reduction, although only
      by a modest amount relative to the overall high level of
      debt.

   -- Capex in 2015 in line with 2014, followed by capex in 2016
      of more than the $96 million spent in 2014 as a result of
      an expansion project related to a new customer contract.

Based on these assumptions, S&P arrives at these credit measures
for 2015 and 2016:

   -- FFO to debt of about 11%-13%.
   -- Debt to EBITDA of about 6.0x-6.5x.
   -- FFO cash interest coverage of about 3.8x-4.6x.

S&P views Landsvirkjun's liquidity position as adequate.  S&P
believes that available liquidity sources, in terms of cash,
committed credit facilities, and operating cash flow, should be
significantly more than 1.2x of forecast near-term cash outflows
such as debt repayments, capex, and dividends.  S&P also expects
that sources will exceed uses even if EBITDA declines by 15%.  S&P
understands that Landsvirkjun's $200 million revolving credit
facility (RCF) contains financial covenants, under which S&P
expects Landsvirkjun will retain adequate headroom.

S&P further believes that the company has a sound relationship
with its banks, a satisfactory standing in the credit markets, and
prudent risk management.

S&P calculates these principal liquidity sources, as of the second
quarter of 2015:

   -- $182 million in cash.
   -- Access to a $200 million unused committed RCF expiring in
      December 2018, following its recent refinancing, and a
      committed credit facility amounting to 12 billion Icelandic
      krona (about $90 million), expiring in September 2022.
   -- Annual FFO of about $250 million.

As of the same date, S&P calculates these principal liquidity
uses:

   -- About $250 million in debt maturing in the 12 months from
      second-quarter 2015.
   -- 2015 capex in line with 2014 at about $96 million, and then
      slightly higher in the subsequent 12 months.
   -- Dividend payments of less than $14 million annually in 2015
      and 2016.

The stable outlook reflects that on Iceland, and S&P's assumption
that Landsvirkjun will continue to benefit from a very high
likelihood of support from the Icelandic government.  S&P
anticipates that Landsvirkjun will retain relatively stable EBITDA
and generate free cash flow, which could improve credit measures
and potentially lead to an upward revision of the SACP over the
next couple of years.

S&P could lower the ratings if it was to downgrade Iceland, as
this would indicate that the government's ability to provide
extraordinary support to Landsvirkjun had reduced; or if S&P
believes that the government is less likely to provide timely and
sufficient extraordinary support to Landsvirkjun.  S&P could also
lower the ratings on Landsvirkjun if its credit metrics or
business position weaken significantly, leading S&P to revise down
its SACP.

The likelihood of an upgrade is currently limited in S&P's view,
but it could consider raising the ratings if it both raise the
sovereign rating on Iceland and revise upward Landsvirkjun's SACP.
The latter could occur if the company sustains by FFO to debt
above 12%.



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I T A L Y
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CECCHI GORI: Cal. App. Affirms $5K Sanctions Against Founder
------------------------------------------------------------
The action is one of a series of lawsuits in the United States and
Italy, all arising out of the collapse of the financial empire of
Vittorio Cecchi Gori, an Italian businessman and film producer.
According to the allegations in the complaint, Cecchi Gori
fraudulently transferred millions of dollars from the bankruptcy
estate of his limited liability company, Fin.Ma. Vi S.p.A
(Finmavi), in an effort to put assets out of the reach of
creditors.  Cecchi Gori was the sole shareholder, president, and
chairman of the board of directors of Finmavi.  At its peak,
Finmavi operated more than 40 companies in the business of film
production, distribution, exhibition, television multimedia, real
estate, and professional soccer.

Nous S.r.l. is an Italian limited liability company in the real
estate business that Cecchi Gori used to own.  Nous is now
undergoing liquidation under the jurisdiction of the Court of
Rome, which appointed Davide Franco and Sergio Torri as co-
liquidators of Nous to satisfy the debts of Nous's creditors.
Nous owns 100% of a Luxembourg company called Promint Holdings
S.A., which in turn owns 100% of a Dutch company called Cecchi
Gori Group Europe B.V., which in turns owns 100% of the two United
States companies involved in the action, Cecchi Gori Pictures and
Cecchi Gori USA, Inc.  Based on these allegations, Nous claimed
that it is the ultimate parent of Cecchi Gori Pictures and Cecchi
Gori USA.

Each the three defendants -- Vittorio Cecchi Gori, et al. --
appeals a discovery order that imposed monetary sanctions in the
amount of $5,460.  The defendants argue Nous's discovery was
overbroad and unduly burdensome.  None of the defendants, however,
submitted any evidence showing the nature and extent of the
burden, as required.  And the trial court actually sustained the
overbreadth objections and limited production of documents to the
time period after 2001.

In a Decision dated December 14, 2015, which is available at
http://is.gd/JwJW7tfrom Leagle.com, the Court of Appeals of
California, Second District, Division Seven, affirmed the orders
of the trial court in imposing monetary sanctions, with Nous to
recover cost on appeal.

The case is NOUS, S.r.l., Plaintiff and Respondent, v. VITTORIO
CECCHI GORI, et al. Defendants and Appellants, No. B256996.

Blakely Law Group, Brent H. Blakely, Esq. and Michael Marchand,
Esq. for Defendant and Appellant Vittorio Cecchi Gori.

Wolf, Rifkin, Shapiro, Schulman & Rabkin, Mark J. Rosenbaum, Esq.
-- mrosenbaum@wrslawyers.com and Stephen M. Levine, Esq. --
slevine@wrslawyers.com for Defendants and Appellants Cecchi Gori
Pictures and Cecchi Gori USA, Inc.

Alston & Bird, Peter E. Masaitis, Esq. --
peter.masaitis@alston.com and Evan W. Woolley, Esq. --
evan.woolley@alston.com for Plaintiff and Respondent.

                 About Cecchi Gori

Headquartered in Rome, Italy, Cecchi Gori Group --
http://www.cecchigori.com/-- produces and distributes movies.
At its peak, it produced a dozen films a year, including "Il
Postino" and "Life is Beautiful."  The group also operates
cinemas in Rome.

                        Financial Slide

Cecchi Gori's financial demise started mid-1990s when its
Telemontecarlo unit challenged state broadcaster RAI and
Mediaset, controlled by former Prime Minister Silvio Berlusconi.
The unit lost the network battle and was finally sold to Telecom
Italia.

The company's acquisition of the A.C. Fiorentina soccer club in
mid-1990s also dented the group's financial condition.  Mr.
Cecchi Gori was at one time accused of illegally transferring
money from A.C. Fiorentina to Finmavi, Cecchi Gori Group's
holding company, to prop up the group's weakening finances amid
corruption charges.  Cecchi Gori had sold A.C. Fiorentina.

Cecchi Gori's first knock on the bankruptcy door came in 2002,
when Merrill Lynch and other creditors sued the company for more
than EUR600 million in unpaid debt.



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K A Z A K H S T A N
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KAZKOMMERTSBANK: Fitch Cuts LT Issuer Default Ratings to 'CCC'
--------------------------------------------------------------
Fitch Ratings has downgraded Kazkommertsbank's (KKB) the Long-term
Issuer Default Ratings (IDRs) to 'CCC' from 'B-'. The agency has
also affirmed the Long-term IDRs of Subsidiary Bank Sberbank of
Russia, JSC (SBK) at 'BB+' Halyk Bank of Kazakhstan (HB) at 'BB',
Tsesnabank (TSB) at 'B+', Bank Centercredit (BCC) at 'B' and ATF
Bank JSC at 'B-'.

The Outlook on Tsesnabank has been revised to Negative from
Stable. The Outlooks on Halyk, BCC and ATF are Stable and on SBK
Negative. SBK's Viability Rating (VR) has been downgraded to 'b+'
from 'bb-'. The full list of the rating actions is provided at the
end of this commentary.

The negative rating actions on KKB, SBK and Tsesnabank reflect
increased pressure on the banks' asset quality and capitalisation,
primarily as a result of the depreciation of the Kazakh tenge and
the slowdown of the domestic economy. The affirmation of HB
reflects the bank's sizable capital buffer and strong pre-
impairment profitability, which should enable it to absorb any
moderate further pressure on asset quality. The affirmations of
BCC and ATF reflect their low ratings, which already largely
capture risks relating to the weaker operating environment, and --
in BCC's case -- a fairly low proportion of foreign currency
loans.

Each of the banks has faced considerable increase in deposit
dollarisation over the last two years, with the proportion of
foreign currency liabilities ranging between 58% and 68% (with the
exception of BCC - 46%) at end-3Q15. Banks have been able to
maintain close-to-flat FX positions as a result of cheap currency
swaps from the National Bank of Kazakhstan (NBK), and Fitch
expects these to remain available. However, increased balance
sheet dollarisation has resulted in a heightened proportion of
foreign currency loans, which will be difficult to reduce
materially over the medium term.

KEY RATING DRIVERS - IDRS, VRS AND NATIONAL RATINGS

KKB

KKB's downgrade reflects a significant increase in the volume of
problem (mostly foreign currency- denominated) exposures relative
to Fitch Core Capital (FCC), primarily as a result of the tenge's
devaluation. The ratings also consider the bank's weak recurring
profitability. Taking into account the increased volume and weaker
recovery prospects of the problem exposures, Fitch believes KKB
will, ultimately, likely require external capital support and/or a
restructuring of its liabilities to restore its solvency. However,
the extended track record of regulatory forbearance and debt
service to date suggests that the bank's resolution may not be a
near-term event.

KKB's main problem asset is its exposure to former subsidiary BTA
Bank, which increased to 5.3x FCC at end-3Q15 from 4.1x FCC at
end-1H15 (3.5x FCC estimated by Fitch when it downgraded KKB in
August 2015) and comprised 51% of KKB's gross loans. These loans,
which are ultimately backed by land exposures on BTA's balance
sheet with remote/unclear recovery prospects, are likely to have
increased to approximately 6.5x FCC at end-2015, following further
tenge depreciation in 4Q15.

Non-performing loans (NPLs) made up a further 14% of gross loans
(i.e. 27% of the portfolio net of the BTA exposure) at end-3Q15,
and a moderate 0.4x FCC net of specific impairment reserves.
Further asset quality risks stem from currently performing
foreign-currency loans, which accounted for 8% of the loan
portfolio (0.8x FCC) and property investments comprising an
additional 0.2x FCC at end-3Q15.

Pre-impairment profit (excluding fair-value gains on funding from
the Problem Loan Fund, uncollected accrued interest on loans and
foreign-currency gains) was slightly negative in 9M15 and we
expect this to deepen to an amount equal to approximately 1.4% of
gross loans in 2016, net of interest accrued on the BTA exposure.
After provisions (and notwithstanding the fair-value and trading
gains) the 9M15 net loss consumed 5% of end-2014 equity, and there
is a high likelihood of net losses in 2016 further eating into
capital.

The FCC/ risk-weighted assets (RWAs) ratio fell to 9% at end-3Q15
from 12% at end-2014 due to the tenge's devaluation and net
losses, and is likely to have fallen by a further 1ppt in 4Q15 as
a result of further tenge weakening. The regulatory Tier I ratio
declined to 9.8% at end-November 2015 from 11.4% at end-November
2014, and the Total ratio fell to 13.8% from 14.4% as foreign-
currency gains on subordinated debt helped partially offset the
pressure. Outstanding hybrid and subordinated instruments were
equal to a material 4.1% of RWAs at end-3Q15, but bail-in of these
would by itself be insufficient to restore the bank's solvency, in
Fitch's view, given the scale of the BTA exposure.

The liquidity and funding profile remains a moderately supportive
credit driver, but highly liquid assets (mostly cash held with the
NBK) tightened to 13% of total liabilities at end-3Q15 from 25% at
end-1H15, as KKB financed some customer funding outflows in 3Q15.
The bank made repayments on senior debt (including a USD0.3bn
eurobond payment in November 2015) and upcoming repayments of
senior eurobonds for 2016 and 2017 are not onerous from a
liquidity stand-point, amounting to, respectively, USD0.3bn and
USD0.4bn (2% and 3% of total liabilities). Total foreign
liabilities of USD1.9bn at end-3Q15 comprised 13% of the bank's
liabilities.

HALYK BANK OF KAZAKHSTAN (HB)

The affirmation of HB's 'BB' Long-term IDRs, driven by the 'bb'
VR, reflects Fitch's view that the bank's resilience to economic
headwinds remains fairly strong due to its prominent domestic
market positions, sound capitalization, solid pre-impairment
profitability and robust liquidity. At the same time, HB's ratings
also factor in risks relating to elevated levels of moderately
provisioned problem loans, material loan concentrations and
foreign-currency lending to potentially unhedged borrowers.

Significant asset quality risks result from NPLs and restructured
loans comprising 13% and 8% of gross loans, respectively, at end-
3Q15 and only moderate 62% reserve coverage of these by total loan
impairment reserves. Further risks stem from potential
deterioration of currently performing (neither NPLs nor
restructured) foreign-currency loans, amounting to 22% of gross
loans at end-3Q15.

Nevertheless, loss absorption capacity is solid, as reflected by a
17% FCC ratio at end-3Q15 and pre-impairment profit equal to 7% of
average gross loans (annualized) in 9M15. The high 28% return on
average equity in 9M15 was also moderately supported by foreign-
currency gains and recent limited loan impairment charges.

Robust liquidity is underpinned by a large stock of highly-liquid
assets, mostly placements with the NBK and unencumbered sovereign
securities, equal to a high 55% of customer funding at end-3Q15.
Refinancing risks are moderate, with no upcoming repayments of
eurobond issues in 2016 and repayments amounting to USD0.6bn or 5%
of total liabilities in 2017, only slightly higher than 2015
levels and manageable relative to the liquidity buffer.

HB'S SUBSIDIARIES ALTYN BANK JSC (AB) AND JSC HALYK FINANCE (HF)
The 'BB' Long-term IDRs of AB and HF are equalized with the parent
HB's ratings. Fitch considers AB and HF to be core subsidiaries of
HB based on their prominent roles in providing key services (in
commercial and investment banking) to domestic clients (large
corporate and private banking clients by AB and investment banking
and brokerage clients and related parties by HF). The moderate
size of the subsidiaries (in aggregate, equal to 8.4% of group
total assets at end-3Q15) and healthy balance sheets should make
it relatively easy for HB to support them, if needed. Fitch has
not assigned AB a Viability Rating given the still evolving
business model of the bank following its acquisition by HB in
4Q14.

TSESNABANK (TSB)

The revision of TSB's Outlook to Negative reflects increased
single-name and sector concentration in the bank's loan book,
tighter capitalization and significant volumes of foreign-currency
lending to potentially unhedged borrowers, which may result in
asset quality deterioration in the medium term.

TSB's ratings also continue to factor in the bank's lower than
peers' problem loans, a track record of accessing state-controlled
companies' funding, limited wholesale debt, solid liquidity and
reasonable profitability.

The levels of NPLs and restructured loans remained moderate, at 4%
and 5% of gross loans, respectively, at end-3Q15, although in part
this reflects an unseasoned loan book and long loan tenors.
Concentration risks have increased as a result of additional
moderately secured lending to companies Fitch considers affiliated
with one large agricultural group, which in aggregate comprised
13% of gross loans or 1.4x FCC at end-3Q15, up from 5% of loans
and 0.6x FCC at end-1Q15.

TSB's foreign-currency lending is higher than peers at 55% of
gross loans at end-3Q15. A material 25% share of foreign-currency
loans related to the agricultural (mostly, grain-producing)
sector, whose operating margins could benefit from devaluation as
grain is an export commodity. However, real-estate loans, which
made up a significant 18% of foreign-currency loans and were equal
to 1.1x FCC at end-3Q15, could be negatively affected.

Capitalization remains a constraint on the ratings in light of the
bank's low capital adequacy ratios, high concentrations, weakly
secured exposures and uncertainty around the financing sources of
the 2014 equity injection. The FCC ratio dropped moderately to 8%
at end-3Q15 from 9% at end-2014 due to devaluation and related
growth of foreign-currency RWAs, and could have fallen further, to
around 7%, by end-2015. However, pre-impairment profit was equal
to about 4% of average gross loans (annualized) in 9M15, and
interest income generation is supported by state interest-rate
subsidies on agricultural loans.

The liquidity position has slightly improved recently as liquid
assets (mostly cash placed with the NBK) increased to 18% of
customer deposits at end-November 2015 from a relatively tight 13%
at end-3Q15, despite some senior debt repayments.

BANK CENTERCREDIT (BCC)

BCC's 'B' Long-term IDRs and 'b' VR are constrained by high
problem loans, low core capital ratios, and modest core
profitability. However, the ratings benefit from moderate foreign
currency lending, stable domestic funding and comfortable
liquidity.

Weak loan quality was reflected by a high 16% NPL ratio and 17%
restructured loans at end-3Q15 and only moderate 46% coverage of
total problem loans by loan impairment reserves. At the same time,
downside risks are moderately reduced by lower-than-peers'
exposure to foreign-currency lending (20% of gross loans at end-
3Q15), mostly relating to loans already recognized as
problematic/impaired.

BCC's 8% FCC ratio and 7% core Tier I regulatory capital ratio
(2ppt above the NBK-required minimum level) at end-3Q15 were weak
in light of unreserved problem exposures equal to a significant
2.5x FCC at end-3Q15 and a moderate pre-impairment profit (net of
interest accrued but not received in cash and foreign-currency
gains) equal to 2% of average gross loans (annualized) in 9M15.
However, hybrid and subordinated instruments (equal to a combined
8% of RWAs at end-3Q15) potentially provide significant additional
loss absorption capacity, moderately reducing risks for the bank's
senior creditors.

Liquidity remains comfortable with liquid assets, including cash,
short-term bank placements and unencumbered repo-able securities,
covering a high 27% of customer deposits. Repayments on wholesale
debt in 2016 are immaterial.

ATF BANK

ATF's 'B-' Long-term IDRs reflects weak asset quality,
capitalization and core profitability and a significant foreign
currency loan exposure. The ratings also factor in small volumes
of outstanding wholesale debt, moderately improved liquidity, some
on-going performance improvement and moderately improved recovery
prospects for some of its deeply impaired problem loans driven by
the shareholder's strong domestic political and business
connections.

Asset quality remains burdened by high NPLs, albeit reduced by
write-offs, and by restructured loans comprising 25% and 22% of
gross loans, respectively, at end-3Q15. At the same time, total
loan impairment reserves covered NPLs by only a moderate 65% and
coverage of NPLs and restructured loans in aggregate was a modest
34%.

The tenge's devaluation could exacerbate problems as performing
(neither NPLs nor restructured) foreign-currency loans comprised a
significant 19% of gross loans at end-3Q15 or 2x FCC, mostly
relating to vulnerable sectors, such as trade, transportation and
real estate. Devaluation could also put further pressure on
problem loan recoveries, as net problem foreign-currency loans
equalled 2.2x FCC, including unreserved foreign currency NPLs at
1.1x FCC. Foreclosed property and other assets held for sale made
up an additional 0.5x FCC at end-3Q15.

The bank's 9.3% FCC ratio at end-3Q15 is modest, relative to
unreserved problem loans. Pre-impairment profit, net of interest
accrued but not received in cash and foreign-currency gains,
equalled to a weak 0.2% of average gross loans (annualized) in
9M15, down slightly from 0.5% in 2014.

The liquidity cushion at end-November 2015 was sufficient to meet
repayment of a USD200 million eurobond and other wholesale debt
due in the next 12 months. Highly liquid assets, net of near-term
debt repayments, were equal to 20% of customer deposits, and
mostly comprised placements with the NBK. However, this is only
moderate in light of the considerable historical volatility of
ATF's state-controlled company deposits (24% of customer funding).

SUPPORT RATING FLOORS AND SUPPORT RATINGS

HB's 'B' Support Rating Floor (SRF) reflects moderate potential
support from the Kazakh authorities due to the bank's high
systemic importance, as reflected in its 21% market share in
retail deposits. That said, Fitch does not factor in significant
support expectations into HB's SRF, resulting in a multi-notch
difference between HB's SRF and the sovereign 'BBB+' Long-term
IDR, due to a track record of the sovereign's withholding support
to some systemically important banks in the past.

KKB's 'No Floor' SRF reflects Fitch's opinion that solvency
support from the Kazakh authorities, in an amount sufficient to
address the bank's asset quality problems without senior creditors
facing losses, cannot be relied upon. Moderate capital assistance
and continued regulatory forbearance remain possible, and
liquidity support, at least in local currency, is likely, in our
view.

The 'No Floor' SRFs of TSB, BCC and ATF reflect those banks'
moderate systemic importance and the mixed recent track record of
sovereign support for banks.

IDRS, VR, NATIONAL RATING AND SUPPORT RATING

SB SBERBANK OF RUSSIA JSC (SBK)

SBK's 'BB+' Long-term IDRs are based on its '3' Support Rating
which, in turn, reflects potential support from SBK's parent
Sberbank of Russia (BBB-/Negative). Fitch's view of potential
support is based primarily on the strategic importance of the CIS
region for Sberbank and the small size of SBK relative to its
parent.

The downgrade of SBK's VR to 'b+' from 'bb-' reflects the recent
deterioration of the bank asset's quality and high additional
risks stemming from considerable foreign-currency lending. The VR
continues, however, to factor in SBK's sound liquidity.

NPLs remained at a moderate 8% at end-3Q15 (end-2014: 4%), but
restructured loans increased to 27% (end-2014: 19%), partially due
to portfolio seasoning after rapid expansion in 2012-14, and
reserves comprised a moderate 7% of total loans. The share of
foreign-currency lending was a high 40% of gross loans. Although
this partially relates to loans already recognized as impaired.
Fitch estimates performing (neither NPLs nor restructured)
foreign-currency loans at around 10% of gross loans at end-3Q15.

The FCC ratio was a moderate 10% at end-3Q15 (11% at end-2014),
while unreserved problem loans (mostly, restructured) were equal
to a significant 2.2x FCC. Fitch has been informed that equity
injections from Sberbank are not expected in 2016. Due to high
impairment charges, internal capital generation dropped to 2% in
9M15 from 19% in 2014; pre-impairment profit (net of uncollected
interest and foreign currency gains) fell to a moderate 4% of
average gross loans (annualized), from 5% in 2014.

Liquid assets (mostly cash placed with the NBK) and an uncommitted
credit line from the parent covered customer deposits by a solid
47% at end-November 2015, and wholesale repayments to third
parties due in the next 12 months were insignificant.

DEBT RATINGS

Senior unsecured debt ratings are aligned with Long-term IDRs
based on average recovery expectations. Systemically important
Kazakh banks have not faced bankruptcy proceedings upon default in
recent years. Recoveries for senior creditors (typically in the
30%-50% range) have depended on the extent to which the
authorities have supported banks' restructurings with capital
injections, and so have essentially been the outcome of political
decisions.

Subordinated debt ratings are notched down by one level from
banks' Long-term IDRs, and the perpetual debt ratings of KKB, BCC
and ATF are rated two notches lower than the banks' VRs,
reflecting lower recovery expectations.

RATING SENSITIVITIES

KKB's ratings could be further downgraded if the likelihood
increases that senior creditors will suffer losses as a result of
measures to restore the bank's capital, or if the bank's capital
ratios are further eroded as a result of tenge depreciation and
losses. The ratings could be upgraded if the bank is recapitalized
without senior creditors facing losses.

The VRs of HB, TSB, BCC, ATF and SBK, and consequently the Long-
term IDRs of the first four banks and of HB's subsidiaries, could
be downgraded if their asset quality, core profitability, and
capitalization deteriorate and/or liquidity levels fall
substantially. SBK's Long-term IDRs would likely be downgraded if
the parent's Long-term IDRs are downgraded, a risk reflected in
the Negative Outlooks on both banks.

An upgrade of the ratings of HB and its subsidiaries would be on
contingent on the operating environment improving and the bank
maintaining its currently strong financial metrics. An upgrade of
the VRs of BCC, ATF and SBK, and consequently the Long-term IDRs
of BCC and ATF, would be contingent on significant problem loan
recoveries and/or additional capital provided by their respective
shareholders (more likely in the case of SBK).

TSB's ratings could stabilize at their current levels in case of
an extended track record of reasonable asset quality and
performance metrics in the tougher operating environment.

The rating actions are as follows:

KKB

  Long-term foreign and local currency IDRs: downgraded to 'CCC'
   from 'B-'
  Short-term foreign and local currency IDRs: downgraded to C'
   from 'B'
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at 'NF'
  Viability Rating: downgraded to 'ccc' from 'b-'
  Long-term senior unsecured debt (incl. issues of Kazkommerts
   International BV) ratings: downgraded to 'CCC' from 'B-';
   Recovery Rating is at 'RR4'
  Short-term senior unsecured debt ratings: downgraded to 'C' from
   'B'
  Subordinated debt rating: downgraded to 'CC from 'CCC'; Recovery
   Rating at 'RR5'
  Perpetual debt (issued by KAZKOMMERTS FINANCE BV) rating:
   downgraded to 'C from 'CC'; Recovery Rating is at 'RR6'

HB

  Long-term foreign and local currency IDRs: affirmed at 'BB';
   Outlook Stable
  Short-term foreign and local currency IDRs: affirmed at 'B'
  Viability Rating: affirmed at 'bb'
  Support Rating: affirmed at '4'
  Support Rating Floor: affirmed at 'B'
  Senior unsecured debt: affirmed at 'BB'

AB

  Long-term foreign and local currency IDRs: affirmed at 'BB';
   Outlook Stable
  Short-term foreign-currency IDR: affirmed at 'B'
  National long-term rating: affirmed at 'A+(kaz)'; Outlook Stable
  Support Rating: affirmed at '3'

HF

  Long-term foreign and local currency IDRs: affirmed at 'BB';
   Outlook Stable
  Short-term foreign and local currency IDRs: affirmed at 'B'
  Support Rating: affirmed at '3'

TSB

  Long-term foreign and local currency IDRs: affirmed at 'B+';
   Outlook revised to Negative from Stable
  Short-term foreign and local currency IDRs: affirmed at 'B'
  National long-term rating: affirmed at 'BBB-(kaz)'; Outlook
   revised to Negative from Stable
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at 'NF'
  Viability Rating: affirmed at 'b+'
  Senior unsecured debt rating: affirmed at 'B+'; Recovery Rating
   at 'RR4'
  Subordinated debt rating: affirmed at 'B'; Recovery Rating at
  'RR5'

BCC

  Long-term foreign and local currency IDRs: affirmed at 'B';
   Outlook Stable
  Short-term foreign-currency IDR: affirmed at 'B'
  National long-term rating: affirmed at 'BB+(kaz)'; Outlook
   Stable
  Viability Rating: affirmed at 'b'
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at 'NF'
  Senior unsecured debt rating: affirmed at 'B'; Recovery Rating
   at 'RR4'
  National senior unsecured debt rating: affirmed at 'BB+(kaz)'
  Subordinated debt rating: affirmed at 'B-'; Recovery Rating at
   'RR5'
  National subordinated debt rating: 'BB-(kaz)';
  Perpetual debt rating: affirmed at 'CCC'; Recovery Rating at
   'RR6'

ATF

  Long-term foreign and local currency IDRs: affirmed at 'B-';
   Outlook Stable
  Short-term foreign currency IDR: affirmed at 'B'
  National long-term rating: affirmed at 'BB-(kaz)'; Outlook
   Stable
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at 'NF'
  Viability Rating: affirmed at 'b-'
  Senior unsecured debt rating: affirmed at 'B-'; Recovery Rating
   at 'RR4'
  National senior unsecured debt rating: affirmed at 'BB-(kaz)'
  Subordinated debt rating: affirmed at 'CCC'; Recovery Rating at
   'RR5'
  National subordinated debt rating: 'B(kaz)';
  Perpetual debt rating: affirmed at 'CC'; Recovery Rating at
   'RR6'

SBK

  Long-term foreign and local currency IDRs: affirmed at 'BB+';
   Outlook Negative
  Short-term foreign currency IDR: affirmed at 'B'
  Support Rating: affirmed at '3'
  Viability Rating: downgraded to 'b+' from 'bb-'
  National long-term Rating affirmed at 'AA-(kaz)'; Outlook
   Negative
  Senior unsecured debt rating: affirmed at 'BB+'
  National senior unsecured debt rating: affirmed at 'AA-(kaz)'
  Subordinated debt rating: affirmed at 'BB'
  National subordinated debt rating: affirmed at 'A+(kaz)'



===========
N O R W A Y
===========


HAVILA SHIPPING: Fails to Get Bondholder Support for Debt Plan
--------------------------------------------------------------
Luca Casiraghi at Bloomberg News reports that Havila Shipping ASA
said it has so far failed to get enough support from bondholders
to postpone repayments on NOK5.7 billion (US$647 million) of debt.

The company said in a statement on Jan. 19 it canceled a meeting
with bondholders scheduled for Jan. 20 as it seeks further talks
to reach an agreement with bond creditors by the end of the month,
Bloomberg relates.

Havila is seeking to extend the maturity of its 2016 and 2017
bonds to 2020 and defer interest payments on some of the notes,
Bloomberg says, citing a presentation on the Oslo Stock Exchange
on Jan. 5.

According to Bloomberg, Havila is asking for a reprieve to cope
with crude oil prices that have dropped to a 12-year low.  The
company, which has to repay NOK2.8 billion in interest and
principal before the end of 2017, said it's seeking to restructure
debt because it expects adverse market conditions in the next few
years, Bloomberg relays.

Havila's bank lenders have agreed to the proposal, which also
allows the company to slow down payment of its loans, Bloomberg
states.  The company, Bloomberg says, still needs the support of
two thirds of each class of bondholders.  The statement said if
the proposal is accepted, shareholders will inject NOK200 million
of additional cash, Bloomberg notes.

Havila Shipping ASA is a Norwegian operator of oil-rig support
vessels.



===========
R U S S I A
===========


NOVIKOMBANK JSC: Fitch Cuts FC Issuer Default Rating to 'B-'
------------------------------------------------------------
Fitch Ratings has downgraded JSCB Novikombank's (Novikom) Long-
term foreign-currency Issuer Default Rating (IDR) to 'B-' from
'B', and placed the bank on Rating Watch Negative (RWN). A full
list of rating actions is available at the end of this commentary.

The downgrade reflects significantly increased asset quality
problems and a lack of adequate capital support from the majority
shareholder, Russian Technologies State Corporation (Rostec), to
address these. The bank is currently reliant on regulatory
forbearance for only gradual provisioning of certain risk
exposures to avoid breaching minimal capital ratios, while planned
moderate shareholder capital contributions are insufficient to
bring the bank back into compliance on a sustained basis.

The RWN reflects Fitch's view of a significant near-term risk of
some form of resolution being imposed on the bank, which in turn
reflects uncertainty over the ongoing review of the bank by the
regulatory authorities. The RWN also reflects uncertainty over (i)
the level of problem loans and reserve requirements in
Fundservicebank -- which was recently acquired by Novikom after
failing -- and therefore the sufficiency of received government
support for the takeover; and (ii) the availability of further
aid, should it be needed.

KEY RATING DRIVERS

IDRS, NATIONAL RATINGS, VIBILITY RATING AND SENIOR DEBT RATINGS

Novikom's asset quality has weakened with NPLs (loans over 90 days
overdue) increasing to an estimated 12% at end-1H15 (adjusted for
an exposure to Transaero, a large domestic airline, which became
an NPL in 4Q15) from 3% at end-2014. A further 2% of loans were
overdue by less than 90 days, and at least 5% more were
restructured at end-1H15. Loan impairment reserves were equal to
8% of gross loans at end-1H15, covering a moderate 40% of the
combined overdue and restructured loans, while the unreserved part
amounted to a high 137% of Fitch Core Capital (FCC).

Credit risks are further aggravated by Novikom's significant loan
concentrations, with the majority of large exposures being private
companies outside of the Rostec group (about 70% of total loans).
These are viewed as higher-risk, in particular given their long
tenors and/or the generally weak financials of the borrowers.
Loans to the Rostec group of companies (around 30% of loans) are
somewhat lower risk due to the Defence and Technology sector's
strategic importance and potential state support; however,
sanctions imposed on these companies could hamper the ability of
some of them to service obligations.

Further asset quality risks in Fitch's view may stem from certain
foreign bank placements and securities holdings, which together
are comparable in volume to the bank's FCC. Fitch's view of the
potential risk of the bank placements is driven primarily by these
balances having been kept immobile in non-top tier international
banks despite risk-weightings of up to 50% which are rather
onerous for capital ratios, while the securities are held in
foreign depositories despite the 50% provisioning requirement for
these exposures from January 2016.

There is also contingent risk from Fundservice, as, Fitch
believes, most of its loans (RUB66 billion at end-2015) are NPLs
with uncertain recovery prospects. The agency estimates that the
fair value gain from cheap deposits placed by state Depositary
Insurance Agency with Fundservice will be sufficient to reserve
its NPLs by about 76%, with the unreserved part amounting to about
120% of Novikom's FCC.

Novikom's capitalization is tight, with the regulatory Tier 1
ratio of 6.4% at end-11M15 only marginally above the regulatory
minimum of 6%. This should also be viewed together with unreserved
overdue/restructured loans and other high-risk exposures, which
together amounted to a high 260% of FCC.

The Central Bank of Russia (CBR) has allowed Russian banks to
reserve their Transaero exposure gradually by end-3Q16. However,
given the currently modest available Tier 1 capital buffer of
about RUB1.5 billion (including unaudited profit for 2H15) and
estimated net profit for the 9M16 of RUB2.1 billion (this assumes
a loan impairment charge of 3% on other loans, comparable to those
in 9M15, annualized) the bank will need at least RUB6 billion of
external capital by end-3Q16 to be able reserve loan to Transaero
and securities held in foreign depositaries, as required.

The bank expects a RUB1.6 billion equity injection in the form of
real estate in 1Q16 and potentially a further, but less certain,
equity contribution of RUB1.5 billion-RUB2 billion in 1Q16-2Q16,
which would still be insufficient. Fitch believes Novikom may now
be in talks with the regulator over some form of resolution with
the help of an external investor, although finding one could be
problematic, as the bank itself is under sanctions.

Novikom's liquidity is currently stable, supported by funding from
Rostec, although this could become more volatile if the bank's
position weakens.

SUPPORT RATING AND SUPPORT RATING FLOOR

The Support Rating of '5' reflects that support from the majority
shareholder, while possible, cannot be relied upon. The Support
Rating Floor of 'No Floor' reflects that support from the Russian
authorities cannot be relied upon due to Novikom's limited
systemic significance.

RATING SENSITIVITIES

IDRS, SUPPORT RATING, NATIONAL RATINGS, VIABILITY RATING AND
SENIOR DEBT RATINGS

Novikom's ratings could be downgraded should asset quality,
capitalisation and core performance deteriorate further, or if
other significant risks arise as a result of the regulatory
review.

The ratings could stabilise at their current level, or be
upgraded, if the bank receives sufficient capital support, or is
taken over by a stronger financial institution.

The rating actions are as follows:

  Long-term foreign and local currency IDRs downgraded to 'B-'
   from 'B', placed on RWN
  Short-term foreign-currency IDR 'B' placed on RWN
  Viability Rating downgraded to 'b-' from 'b', placed on RWN
  Support Rating affirmed at '5'
  Support Rating Floor affirmed at 'No Floor'
  National Long-term Rating downgraded to 'BB-(rus)' from
   'BBB(rus)', placed on RWN
  Senior unsecured debt downgraded to 'B-' from 'B'; placed on
   RWN; Recovery Rating 'RR4'
  Senior unsecured debt National Long-term Rating: downgraded to
   'BB-(rus); from 'BBB(rus)', placed on RWN


SVYAZNOY BANK: Declared Bankrupt by Moscow Arbitration Court
------------------------------------------------------------
PRIME reports that the Moscow Arbitration Court declared Svyaznoy
Bank, the 150th in Russia by the amount of assets as of Nov. 1,
bankrupt on a petition by the central bank on Jan. 20.

The central bank revoked the Svyaznoy Bank license in November
2015 and appointed an interim provisional administration, PRIME
relates.

According to PRIME, an official of the regulator said that the
assets of the bank are RUR12.6 billion and the liabilities amount
to RUR12.9 billion.

Svyaznoy group, which also includes handset retailer Svyaznoy,
passed to businessman Oleg Malis in December 2014, as Malis
purchased the claim rights for Svyaznoy group's overdue debts from
Onexim and non-state pension fund Blagosostoyanie, PRIME relays.

The control over the bank came to Mr. Malis in April 2015, PRIME
discloses.



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


ABENGOA SA: Wind Power Companies May Take Over Brazil Projects
--------------------------------------------------------------
Luciano Costa at Reuters reports that power companies with
wind-generation capacity could take over transmission line
projects in Brazil operated by Abengoa SA after the Spanish
construction group's insolvency filing halted work on the systems.

According to Reuters, three specialists with knowledge of the
discussions on Jan. 18 said candidates include groups like Renova
Energia SA and CPFL Renovaveis SA that would lose revenue if the
transmission lines go unfinished or remain inactive.

Any proposal to take over Abengoa's rights would require approval
from Brazil's electrical power regulator Aneel, Reuters notes.

Casa dos Ventos, a smaller company that does not have projects
threatened by Abengoa's Nov. 25 insolvency filing in Spain, is
also studying some specific Abengoa assets, Reuters relays, citing
the company's director of new business Lucas Araripe.

Mr. Araripe said the companies do not necessarily want to take
over entire concession contracts, only the minimum parts needed to
keep plants going, Reuters notes.

As reported by the Troubled Company Reporter-Europe on Nov. 30,
2015, Bloomberg News related that Abengoa on Nov. 27 said it had
formally applied to a court in Seville for preliminary creditor
protection.  Under Spanish bankruptcy law, the company may now
suspend payments and keep negotiating with lenders for a maximum
of four months, Bloomberg disclosed.  If Abengoa hasn't reached a
deal by the end of March, it will have to file for full-blown
creditor protection, Bloomberg noted.

Abengoa SA is a Spanish renewable-energy company.


                        *       *       *

As reported by the Troubled Company Reporter-Europe on Dec. 21,
2015, Standard & Poor's Ratings Services lowered to 'SD'
(selective default) from 'CCC-' its long-term corporate credit
rating on Spanish engineering and construction company Abengoa
S.A.  S&P also lowered the short-term corporate credit rating on
Abengoa to 'SD' from 'C'.  S&P said the downgrade reflects
Abengoa's failure to pay scheduled maturities under its EUR750
million Euro-Commercial Paper Program.



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


ARBOUR CLO III: Fitch Assigns 'BB(EXP)sf' Rating to Cl. F Notes
---------------------------------------------------------------
Fitch Ratings has assigned Arbour CLO III Limited notes expected
ratings, as follows:

Class A-1: 'AAA(EXP)sf'; Outlook Stable
Class A-2: 'AAA(EXP)sf'; Outlook Stable
Class B-1: 'AA(EXP)sf'; Outlook Stable
Class B-2: 'AA(EXP)sf'; Outlook Stable
Class C: 'A(EXP)sf'; Outlook Stable
Class D: 'BBB(EXP)sf'; Outlook Stable
Class E: 'BB(EXP)sf'; Outlook Stable
Class F: 'B-(EXP)sf'; Outlook Stable
Subordinated notes: not rated

The assignment of final ratings is contingent on the receipt of
final documents conforming to information already reviewed.

Arbour CLO III Limited is an arbitrage cash flow collateralized
loan obligation (CLO). Net proceeds from the issuance of the notes
will be used to purchase a EUR400 million portfolio of European
leveraged loans and bonds. The portfolio is managed by Oaktree
Capital Management (UK) LLP. The transaction features a four-year
reinvestment period.

KEY RATING DRIVERS

'B+'/'B' Portfolio Credit Quality
Fitch places the average credit quality of obligors in the
'B+'/'B' range. The agency has public ratings or credit opinions
on all but seven of the obligors in the identified portfolio. The
weighted average rating factor of the identified portfolio is
30.5.

High Recovery Expectations

At least 90% of the portfolio comprises senior secured
obligations. Fitch has assigned Recovery Ratings to all assets in
the identified portfolio. The covenanted minimum Fitch weighted
average recovery rate (WARR) for assigning the final ratings is
69.5%. The WARR of the indicative portfolio is 74.9%.

Diversified Portfolio

The transaction contains a covenant that limits the top 10
obligors to 23% of the portfolio balance. In addition, portfolio
profile tests limit exposure to the top Fitch industry to 20% and
the top three Fitch industries to 40%. This ensures that the asset
portfolio is not exposed to excessive obligor concentration.

Partial Interest Rate Hedge

Between 5% and 15% of the portfolio may be invested in fixed rate
assets, while fixed rate liabilities account for 8.75% of the
target par amount. The collateral manager will not be able to buy
floating rate assets while the test is below 5%.

Limited FX Risk

The transaction is allowed to invest in non-euro-denominated
assets, provided these are hedged with perfect asset swaps within
six months of purchase. Unhedged non-euro assets may not exceed
2.5% of the portfolio at any time and can only be included if at
the trade date of such assets the portfolio balance is above the
target par amount when their principal balance converted into euro
at spot rate are haircutted by 50%.

Documentation Amendments

The transaction documents may be amended subject to rating agency
confirmation or noteholder approval. Where rating agency
confirmation relates to risk factors, Fitch will analyze the
proposed change and may provide a rating action commentary if the
change has a negative impact on the ratings. Such amendments may
delay the repayment of the notes as long as Fitch's analysis
confirms the expected repayment of principal at the legal final
maturity.

If in the agency's opinion the amendment is risk-neutral from a
rating perspective Fitch may decline to comment. Noteholders
should be aware that the structure considers the confirmation to
be given if Fitch declines to comment.

RATING SENSITIVITIES

A 25% increase in the expected obligor default probability would
lead to a downgrade of up to three notches for the rated notes.

A 25% reduction in expected recovery rates would lead to a
downgrade of up to four notches for the rated notes.

DUE DILIGENCE USAGE

All but one of the underlying assets have ratings or credit
opinions from Fitch. Fitch has relied on the practices of the
relevant Fitch groups to assess the asset portfolio information.

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


EASTERN CONTINENTAL: Chapter 15 Case Summary
--------------------------------------------
Chapter 15 Petitioner: Ninos Koumettou, Liquidator

Chapter 15 Debtor: Eastern Continental Mining and
                   Development Ltd.
                   59-60 Cornhill, 1st Floor
                   London EC3V 3PD

Chapter 15 Case No.: 16-10121

Type of Business: Mineral Mining

Chapter 15 Petition Date: January 18, 2016

Court: United States Bankruptcy Court
       District of Delaware (Delaware)

Chapter 15 Petitioner's Counsel: Kevin Scott Mann, Esq.
                                 Christopher P. Simon, Esq.
                                 CROSS & SIMON, LLC
                                 1105 N. Market Street, Suite 901
                                 P.O. Box 1380
                                 Wilmington, DE 19899-1380
                                 Tel: 302-777-4200
                                 Fax: 302-777-4224
                                 Email: kmann@crosslaw.com
                                        csimon@crosslaw.com

Estimated Assets: Not Indicated

Estimated Debts: Not Indicated


SANTANDER UK: S&P Raises Rating on 3 Legacy Instruments to BB
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised the
outlook on Santander UK PLC to stable from negative and affirmed
its 'A/A-1' long- and short-term counterparty credit ratings on
the bank.

At the same time, S&P affirmed the 'BBB/A-2' counterparty credit
ratings on nonoperating holding company (NOHC) Santander UK Group
Holdings PLC (or the UK NOHC).  The outlook is stable.

S&P also raised to 'BB' from 'BB-' its rating on three legacy
instruments (ISIN XS0124569566, XS0188550114, and XS0502105454)
issued by Santander UK and affirmed the ratings on all other
hybrid instruments.

The revision of S&P's outlook on Santander UK's long-term rating
incorporates the significant amount of debt that the UK NOHC has
issued externally since April 2015.  As a result, S&P sees a
smaller risk that the U.K. banking group's issuance of additional
loss-absorbing capacity (ALAC) buffer may fall short of S&P's
projections.

S&P continues to include two notches of uplift in the long-term
rating on Santander UK because S&P considers it is likely to
increase ALAC above its 8% threshold over the next two years.  S&P
estimates that the bank's buffer was close to 6% at end-2015.  The
projected increase is mainly attributable to expected senior
unsecured issuance by Santander UK's intermediate holding company,
Santander UK Group Holdings.  S&P observes, for instance, the
latter's benchmark US$1 billion senior unsecured bond issuance in
October 2015, and its US$1 billion and GBP500 million issuance in
January 2016.  S&P expects continued market appetite for these
instruments in 2016.  S&P therefore believes that Santander UK's
ALAC buffer will exceed 8% by end-2016, based mostly on further
senior unsecured issuance by the UK NOHC.

Consistent with S&P's criteria, it continues to rate Santander UK
above its parent Banco Santander (A-/Stable/A-2) as a result of
ALAC.  This is because S&P believes that the subsidiary is clearly
subject to a separate resolution process; that the subsidiary will
be able to continue operating without defaulting on its senior
unsecured obligations in the event of a resolution of the parent;
and that Santander UK's ALAC cannot be used to recapitalize
another part of the Banco Santander group.

S&P has maintained the unsupported group credit profile (GCP) at
'bbb+', reflecting the Santander UK group's sound capitalization
and risk position, and the gradual strengthening of its franchise.
S&P expects that the bank's risk-adjusted capital (RAC) ratio will
be in the 9.25%-9.75% range in the next two years, with sound
earnings generation offsetting a sustained growth in exposures and
the distribution of about half the net income through dividends.
Therefore, S&P's projected RAC edges toward the upper-end of the
7%-10% range S&P typically ascribes to an adequate assessment of
capital and earnings.  S&P's projection does not incorporate any
possible subsequent AT1 issuance or refinancing of legacy issues
currently excluded from S&P's ratio.

The upgrade of three legacy tier 1 instruments reflects S&P's view
of a lower risk of coupon deferral.  S&P rates most of Santander
UK's legacy tier 1 instruments four notches below the stand-alone
credit profile.  S&P previously rated these three instruments one
notch lower, with the extra notch reflecting S&P's view that--
given their fully discretionary nature--coupon payments could be
deferred in the event of coupon deferral on instruments issued by
Banco Santander, which are themselves subject to earnings tests.
The upgrade considers, among other things, S&P's continued
expectation of sound earnings generation by the bank and its
parent, and the upgrade of Banco Santander and its hybrids in the
fourth quarter of 2015.

Santander UK PLC

The stable outlook on Santander UK reflects S&P's expectation of
continued gradual strengthening in capitalization over the next
two years and the continued issuance of a material buffer of
senior debt at the holding company level.

S&P could lower the ratings if the Santander UK group's issuance
of ALAC-eligible instruments in the next 18 months--including NOHC
senior debt--were to fall materially short of S&P's expectations.
S&P currently projects that most of the ALAC progression to above
8% over the next 18 months will stem from holding company senior
debt issuance.  S&P sees limited downside risk to Santander UK's
stand-alone creditworthiness.

Although unlikely at this stage, S&P could raise its rating on
Santander UK if the successful implementation of its corporate
banking strategy led to materially improved diversification of its
revenue streams.  Further capital strengthening, with a RAC ratio
remaining above 10%, could exert positive pressure on the
unsupported GCP; but S&P would not expect this to lead it to raise
the ratings on Santander UK as this would likely result in a
related one-notch reduction in the ALAC uplift.

Santander UK Group Holdings PLC

The stable outlook on Santander UK Group Holdings reflects S&P's
view of the stable stand-alone creditworthiness of the Santander
UK group.

S&P could raise the rating on Santander UK Group Holdings if S&P
revised upward the unsupported GCP, as mentioned above.

S&P sees limited downside risk to the ratings on the UK NOHC,
reflecting S&P's view of the Santander UK group's resilient
intrinsic creditworthiness.



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


* S&P Raises Ratings on 7 Companies' Debt Instruments
-----------------------------------------------------
Standard & Poor's Ratings Services said that it is revising upward
the recovery ratings of seven companies' debt instruments to '1+'
from '1' following the publication of an interpretation of its
criteria on recovery ratings of '1+'.  As a result, S&P is also
raising the issue ratings on these instruments by one notch.  At
the same time S&P is affirming the existing recovery rating of
'1+' on three companies' debt instruments.

The interpretation explains that if S&P considers a debt
instrument to have significant overcollateralization and strong
structural features and, as a result, have very high confidence
that it will realize a full recovery, even if S&P assumes that the
instrument and any incremental facilities provided for in its
governing document are fully drawn, then the debt instrument
qualifies for a '1+' recovery rating.  If the recovery rating is
'1+', the corresponding issue rating can be up to three notches
above the corporate rating.

Rating List Upgrades:
                            To            From
FTE Verwaltungs GmbH
Senior Secured              BB            BB-
Recovery Rating             1+            1

Mabel Bidco Ltd.
Senior Secured              BB-           B+
Recovery Rating             1+            1

Odeon & UCI Bond Midco Ltd.
Senior Secured              B+            B
Recovery Rating             1+            1

PIZZAEXPRESS FINANCING 1 PLC
PIZZAEXPRESS GROUP LTD.
Senior Secured              BB            BB-
Recovery Rating             1+            1

Silk Bidco AS
Senior Secured              BB            BB-
Recovery Rating             1+            1

Vougeot Bidco PLC
Senior Secured              BB            BB-
Recovery Rating             1+            1

Ratings List:               Unchanged

Elli Finance (UK) PLC
Senior Secured              B-
Recovery Rating             1+

Elli Investments Ltd.
Senior Unsecured            C
Recovery Rating             6

FTE Verwaltungs GmbH
Senior Secured              B
Recovery Ratings            3L

Hema B.V.
Senior Secured              BB
Recovery Rating             1+

HEMA Bondco I B.V.
Senior Secured              B
Recovery Rating             3L

HEMA Bondco II B.V.
Senior Unsecured            CCC+
Recovery Rating             6

Stretford 79 PLC
Senior Secured              B+
Recovery Rating             3L

Wagamama Finance PLC
Senior Secured              B-
Recovery Rating             4H

Odeon & UCI Finco PLC
Senior Secured              CCC+
Recovery Rating             4H

PIZZAEXPRESS FINANCING 2 PLC
Senior Secured              B
Recovery Rating             3H

PIZZAEXPRESS FINANCING 1 PLC
Senior Unsecured            CCC+
Recovery Rating             6

Priory Group No.3 PLC
Senior Secured              BB
Recovery Rating             1

Priory Group No.3 PLC
Senior Unsecured            B+
Recovery Rating             3H

Silk Bidco AS
Senior Secured              B
Recovery Ratings            4H

Vougeot Bidco PLC
Senior Secured              B
Recovery Rating             4H


* Katz Joins Fried Frank's Bankruptcy & Restructuring Practice
--------------------------------------------------------------
Fried, Frank, Harris, Shriver & Jacobson LLP on Jan. 19 disclosed
that Ashley Katz will join as a partner in the Bankruptcy and
Restructuring Practice, resident in the Firm's London office. He
has extensive experience advising financial institutions,
borrowers, bondholders, insolvency practitioners and distressed
investors in relation to all aspects of restructuring and
insolvency matters.  He advises on a range of cross-border and UK
restructurings and insolvencies -- including matters in the
automotive, real estate, construction, financial services, retail
and leisure sectors.

"We are pleased to welcome Ashley to Fried Frank, where he will
help build out our core practices in Europe and support client
needs by providing a strong Bankruptcy and Restructuring
capability in this key market," said David Greenwald, chairman of
Fried Frank.  "Ashley brings excellent technical skills and he
shares our commitment to helping our clients with their most
sophisticated and challenging matters.  He is a fantastic addition
to our Bankruptcy and Restructuring Practice, and our team of
lawyers in the US and Europe looks forward to working with him."

"I am delighted that Ashley is joining Fried Frank at an exciting
time of growth for our London office.  He will be fully integrated
into our existing Bankruptcy and Restructuring team, working with
us to deliver valuable counsel to clients who need initial deal
structuring advice and assistance with transactions that involve
distressed issues," said Brad Eric Scheler, chairman of Fried
Frank's Bankruptcy and Restructuring Practice.  "Throughout his
career, Ashley has consistently demonstrated intellectual vigor
and creativity, which have long been cornerstones of Fried Frank's
Bankruptcy and Restructuring Practice. Our current team is excited
to collaborate with him as we act for funds and other creditors,
as well as clients on the debtor side, on transatlantic
assignments."

Before joining Fried Frank, Mr. Katz was joint head of Mayer
Brown's Restructuring, Bankruptcy and Insolvency group in London.
He received his Advanced Certificate in International Insolvency
Law from the University of Pretoria in South Africa in 2002, his
Diploma in Insolvency Law with distinction from Rand Afrikaans
University in South Africa in 2000, and his BA and LLB from the
University of the Witwatersrand in Johannesburg, South Africa, in
1992 and 1994, respectively.  He is admitted to practice in
England and Wales and in South Africa.

This development follows Fried Frank's expansion of its Asset
Management Practice to Europe, with last year's addition of four
partners in London.  Since 2014, Fried Frank's European offices
have also added two new partners in the Mergers and Acquisitions
and Private Equity Practice, two new partners in the Finance
Practice and a new partner in the Tax Practice.

                       About Fried Frank

Fried, Frank, Harris, Shriver & Jacobson LLP --
http://www.friedfrank.com-- is an international law firm with
approximately 450 lawyers who advise the world's leading
corporations and financial institutions on their most critical
legal needs and business opportunities.  The Firm has offices in
New York; Washington, DC; London; Paris; Frankfurt; Hong Kong; and
Shanghai.


                            *********

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 Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.


                            *********


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

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

Copyright 2016.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

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

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Nina Novak at
202-362-8552.


                 * * * End of Transmission * * *