TCREUR_Public/160422.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Friday, April 22, 2016, Vol. 17, No. 079


                            Headlines


B U L G A R I A

CORPORATE COMMERCIAL: MPs Approve Making Report on KTB Public


F R A N C E

LOXAM SAS: S&P Affirms 'BB-' CCR, Outlook Stable


G E R M A N Y

ABAKUS SOLAR: Starts Preliminary Insolvency Process
PAPIERFABRIK WALSUM: In Talks With Potential Buyer
UNIQUE WORLD: Asia Specialist Tour Operator Files Insolvency


I R E L A N D

GSC EUROPEAN CDO I-R: Moody's Hikes Class E Notes Rating to Ba1
GSC EUROPEAN CDO II: Moody's Hikes Combination Y Rating to Caa1


I T A L Y

MONTE DEI PASCHI: Fitch Affirms B-/B IDRs, Outlook Stable


K A Z A K H S T A N

KAZAKHSTAN TEMIR: S&P Puts 'BB' CCR on CreditWatch Negative


P O L A N D

KOMPANIA WEGLOWA: Private Lenders Oppose Rescue Plan


R O M A N I A

TRANSELECTRICA SA: Moody's Hikes Corporate Family Rating to Ba1


R U S S I A

ENERGOMASH: Creditors Lose Bid to Annual Retrial Ruling
EVROKREDIT LLC: Liabilities Exceed Assets, Inspection Reveals
FAR-EASTERN SHIPPING: Fitch Lowers Issuer Default Rating to CC
KROSSINVESTBANK OJSC: Placed Under Provisional Administration
SOVEREIGN-AUTO: High Court Affirms Fine Against Interim Manager

ZERNOBANK JSC: Liabilities Exceed Assets, Inspection Shows


S P A I N

BANCO BPI: Moody's Puts 'Ba3' Rating on Review Uncertain
CAIXABANK SA: Moody's Affirms Ba2 Subordinated Debt Ratings
GRUPO ISOLUX: Taps Houlihan Lokey to Review Debt Structure
NH HOTEL: Fitch Revises Outlook to Positive & Affirms B- IDR


S W I T Z E R L A N D

GATEGROUP HOLDING: S&P Puts BB- CCR on CreditWatch Negative


U N I T E D   K I N G D O M

ELEMENT MATERIALS: S&P Withdraws B Corporate Credit Rating
TOWD POINT: Moody's Assigns B1 Definitive Ratings to Cl. G Debt


X X X X X X X X

* Global Corporate Borrowers Default on US$50BB Debt in 2016
* Moody's Expects EMEA Corporate Defaults to Increase
* BOOK REVIEW: The Money Wars


                            *********


===============
B U L G A R I A
===============


CORPORATE COMMERCIAL: MPs Approve Making Report on KTB Public
-------------------------------------------------------------
novinite.com reports that lawmakers in Bulgaria have voted to
approve on second reading changes to the Bank Insolvency Act
paving the way for the publication of a report tracking the
assets of insolvent Corporate Commercial Bank (Corpbank or KTB).

Until now, the text was only available in Parliament's secret
registry, which was not accessible to the general public but only
to lawmakers, the report says.

novinite.com relates that instructions on receivables collection
offered in the report will not be disclosed to avoid disruption
of the work of receivers.

KTB collapsed following a bank run in June 2014, which pushed the
Bulgarian National Bank to place it under supervision, the report
notes.

According to novinite.com, the publication of the document has
been highly controversial among politicians, but has also drawn
fire from UK-based consultancy AlixPartners, which was tasked
with authoring it under clauses of strict confidentiality.

novinite.com says AlixPartners' agreement to lift secrecy was
limited only to access by lawmakers, which resulted in Finance
Minister Vladislav Goranov sending the report the the secret
registry of Parliament where it was available for MPs.

However, legislation changes authored by lawmakers Petar
Chobanov, Yordan Tsonev and Delyan Peevski (all from liberal
Movements for Rights and Freedoms, or DPS, party) obligate KTB's
trustees to upload the report on their website, according to
novinite.com.

Tsonev has reiterated for months that the DPS is committed to a
process of "unveiling the whole truth" about KTB, novinite.com
says.

But his fellow lawmaker Peevski has been linked in a number of
media reports to the bank's collapse, which occurred soon after
the fallout between Peevski and the bank's majority owner Tsvetan
Vasilev with whom the former was said to be involved in a number
of joint business ventures, reports novinite.com.

Corporate Commercial Bank AD is the fourth largest bank in
Bulgaria in terms of assets, third in terms of net profit, and
first in terms of deposit growth.

Bulgaria's central bank placed Corpbank under its administration
and suspended shareholders' rights in June 2014 after a run
drained the bank of cash to meet client demands.



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F R A N C E
===========


LOXAM SAS: S&P Affirms 'BB-' CCR, Outlook Stable
------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' long-term
corporate credit rating on France-based equipment rental company
Loxam SAS.  The outlook is stable.

In addition, S&P affirmed the 'BB-' issue rating on Loxam's
EUR410 million senior secured notes due 2021.  The '3' recovery
rating indicates S&P's expectations of meaningful recovery (50%-
70%; in the higher half of the range) in the event of a payment
default. S&P also affirmed the 'B' issue ratings on the company's
EUR300 million subordinated notes and EUR250 million senior
unsecured notes.  The '6' recovery rating indicates S&P's
expectations of negligible (0-10%) recovery in the event of a
payment default.

At the same time, S&P assigned its 'BB-' issue rating to Loxam's
proposed EUR210 million senior secured notes due 2023.  The '3'
recovery rating indicates S&P's expectation of meaningful
recovery (50%-70%; in the higher half of the range) in the event
of a payment default.

The rating actions reflect S&P's view that Loxam's plans to
refinance its existing EUR300 million subordinated notes with new
EUR210 million senior secured notes are slightly positive for the
company's creditworthiness.  Loxam will also use EUR109 million
of cash to pay down the existing subordinated notes and related
prepayment costs and expense.  These transactions would result in
a reduction in gross debt and should lead to annual interest
savings due to the expected lower coupon and interest expense on
the new instrument.

Furthermore, S&P has taken into account the expected pick-up in
the French construction market and Loxam's capex increase to
expand its fleet of rental equipment.  These factors lead S&P to
expect subtle improvements in Loxam's credit ratios.

"We continue to assess Loxam's financial risk profile as
significant, reflecting our anticipation that the company will
maintain credit metrics commensurate with our significant
category, including a Standard & Poor's-adjusted debt-to-EBITDA
ratio below 4.0x and a cash coverage ratio measured by funds from
operations (FFO) to debt above 20%.  We expect no material
improvement in free operating cash flow (FOCF) generation in 2016
on the back of higher capex of about EUR200 million as the
company seeks to expand its fleet," S&P said.

"We think that Loxam's business risk profile is constrained by
the cyclical nature of demand from construction and civil
engineering end-markets in France, limited predictability of
future revenues due to the mostly short-term nature of the
contracts, and the company's high operational leverage that we
believe is generally associated with the equipment rental
industry.  Although Loxam's geographic footprint is relatively
narrow and focused on France, we view positively its sizable
domestic market share of about 20%, which we think it will be
able to sustain, thanks to its long-standing relationships with
the main French contractors and its dense branch network.  The
Hertz acquisition will likely further strengthen Loxam's position
in France.  We also note that Loxam holds significant positions
in other European countries, such as Denmark, Belgium,
Luxembourg, and The Netherlands, where the company generates
about 21% of its total revenues.  Loxam's international
operations generate lower pre-tax profit than those in France,"
S&P said.

"The stable outlook on Loxam reflects our expectation that its
credit metrics will continue to stand in the lower end of our
significant financial risk profile.  This includes adjusted debt
to EBITDA of lower than 4x and adjusted FFO to debt at the lower
end of the 20%-30% range.  We expect the company to benefit from
a pick-up in the French construction market in 2016.  However, we
also expect Loxam to increase capex to finance the expansion of
its fleet and to capture market growth.  We therefore anticipate
that the company will generate only marginal FOCF.  The stable
outlook also incorporates our assumption that the company will
maintain adequate liquidity," S&P noted.

S&P might raise the ratings if Loxam achieved and sustained
stronger credit metrics, with FFO to debt and debt to EBITDA at
the upper end of S&P's significant financial risk category.  If
so, S&P would likely remove the negative adjustment based on
S&P's comparable rating analysis.  Stronger credit metrics could
result from substantially reduced debt in absolute amounts,
combined with better-than-anticipated operating performance and
moderation with regard to acquisitions.

S&P might consider lowering the ratings if the unfavorable market
conditions significantly constrained Loxam's credit ratios, such
that the group's EBITDA margins fall below 30% for a prolonged
period, leading to FFO to debt of less than 15%, without near-
term prospects for recovery.  S&P could also lower the rating if
Loxam made unexpected, large debt-funded acquisitions.  Rating
pressure could also emerge at any time if the company's liquidity
did not remain at least adequate.



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


ABAKUS SOLAR: Starts Preliminary Insolvency Process
---------------------------------------------------
pv-magazine.com reports that Abakus Solar AG on April 7 applied
for the initiation of preliminary insolvency proceedings in a
local court in the city of Essen.

According to the report, the group said the Gelsenkirchen-based
group's operation and maintenance unit, Abakus Solar Service
GmbH, also applied for preliminary insolvency due to the close
financial relationship with its parent company.

The court has appointed Christoph Niering as the preliminary
insolvency administrator for both companies, the report
discloses.

pv-magazine.com relates that Abakus Solar said its board of
directors was "optimistic that both the engineering and the
operation and maintenance business of the company can be
continued after a swift restructuring." The company added that
the salaries of its employees was secured, the report relays.

pv-magazine.com adds that the group said its U.K.-based
subsidiary, Abakus Solar Manchester Ltd., continued trading and
would continue to service all PV power plants it presently
services in the U.K.

Founded in 1995, Abakus Solar referred to itself as an
"international system house for photovoltaic" focusing on small
to large scale projects. The company's core business included
engineering and construction of PV power plants and providing
operation and maintenance services.


PAPIERFABRIK WALSUM: In Talks With Potential Buyer
--------------------------------------------------
EUWID reports that Papierfabrik Walsum is hoping for a quick
decision in the current talks about the future of the site.

EUWID says preliminary insolvency administrator Andreas Rppke
from the law firm hrm Henneke Ropke Rechtsanwalte in Duisburg,
Germany is conducting promising negotiations with a potential
investor.

This investor reportedly has other plans than previous interested
parties, EUWID relates. According to the report, there is talk of
establishing a new fibres segment as a second pillar, in addition
to LWC production, in the portfolio of the former Norske Skog
mill for coated magazine and catalogue paper. Contrary to
industry speculation that Walsum might be switched over to
production of packaging paper, the prospective investor would
instead focus on raw materials for various paper products.

The local court in Duisburg opened preliminary insolvency
proceedings for Papierfabrik Walsum GmbH on March 15, 2016.
Previously, Green Elephant had purchased the company out of
insolvency as of Feb. 19, 2016, but then quickly faced a shortage
of operating capital, EUWID discloses. The paper machine is
currently running, the report notes.


UNIQUE WORLD: Asia Specialist Tour Operator Files Insolvency
------------------------------------------------------------
fvw.com reports that Unique World, a specialist tour operator for
Asia trips, has declared insolvency.

fvw.com relates that the firm, launched in 2011, offered tours in
Asia, the Indian Ocean and the Middle East, based on its own
flight and hotel contingents. The company's website, displaying
diverse offers for trips to Asia in 2015/16, does not yet mention
the insolvency on the homepage.

According to fvw.com, the district court at Pinneburg, near
Hamburg, has named lawyer Eva Konig as the temporary insolvency
administrator with responsibility for securing assets and
collecting claims from creditors.

Unique World, based near Hamburg, was headed by Dieter Peters,
who formerly worked as sales manager for Transorient, another
Asia specialist tour operator, the report discloses. Its revenues
and customer numbers have not been disclosed. However, the 2015
brochures contained some 177 tours and 648 hotels.



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


GSC EUROPEAN CDO I-R: Moody's Hikes Class E Notes Rating to Ba1
---------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on the
following notes issued by GSC European CDO I-R:

-- EUR20.3 million Class D Floating Rate Notes due 2022,
    Upgraded to Aaa (sf); previously on Nov 30, 2015 Upgraded to
    Aa3 (sf)

-- EUR12.5 million (Current balance outstanding: EUR 12.16M)
    Class E Floating Rate Notes due 2022, Upgraded to Baa2 (sf);
    previously on Nov 30, 2015 Upgraded to Ba1 (sf)

-- EUR4 million (Current rated balance: EUR 5.3M) Class Z
    Combination Notes, Upgraded to Caa2 (sf); previously on Nov
    30, 2015 Affirmed Ca (sf)

Moody's affirmed the ratings on the following notes issued by GSC
European CDO I-R:

-- EUR18.4 million (Current balance outstanding: EUR 3.43M)
    Class C1 Floating Rate Notes due 2022, Affirmed Aaa (sf);
    previously on Nov 30, 2015 Upgraded to Aaa (sf)

-- EUR10 million (Current balance outstanding: EUR 1.86M) Class
    C2 Zero Coupon Accreting Notes due 2022, Affirmed Aaa (sf);
    previously on Nov 30, 2015 Upgraded to Aaa (sf)

GSC European CDO I-R, issued in December 2006, is a
Collateralised Loan Obligation ("CLO") backed by a portfolio of
mostly high yield European loans. The portfolio is managed by
GSCP (NJ), L.P. The transaction's reinvestment period ended on 15
December 2012.

RATINGS RATIONALE

The upgrades to the ratings of the notes are primarily a result
of the improvement in their over-collateralization (OC) ratios
since the last rating action in November 2015. On March 2016
payment date, Class C1 and C2 notes were paid down by EUR11.6
million in total or 41% of their original aggregate balance. As a
result of this deleveraging, the OC ratios have increased.
According to the March 2016 trustee report the OC ratios of
Classes C, D and E are 349.07%, 158.83% and 119.75% compared to
287.22%, 150.59% and 117.20% respectively in December 2015. OC
ratios reported in the March 2016 trustee report are calculated
prior to the distribution of EUR 11.6 million of principle
proceeds to Class C1 and C2 notes, therefore increased OC ratios
will be reported in the next trustee report.

The rating of the Class Z Combination Notes addresses the
repayment of the rated balance on or before the legal final
maturity. The rated balance at any time is equal to the principal
amount of the combination note on the issue date minus the sum of
all payments made from the issue date to such date, of either
interest or principal. The rated balance will not necessarily
correspond to the outstanding notional amount reported by the
trustee.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. In its base
case, Moody's analyzed the underlying collateral pool as having a
performing par of EUR51.82 million, EUR1.89 million of defaulted
assets, a weighted average default probability of 25.43%
(consistent with a WARF of 4,151 with a weighted average life of
3.13 years), a weighted average recovery rate upon default of
49.82% for a Aaa liability target rating, a diversity score of 10
and a weighted average spread of 3.89%.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool. In each case, historical and market
performance and a collateral manager's latitude to trade
collateral are also relevant factors. Moody's incorporates these
default and recovery characteristics of the collateral pool into
its cash flow model analysis, subjecting them to stresses as a
function of the target rating of each CLO liability it is
analyzing.


GSC EUROPEAN CDO II: Moody's Hikes Combination Y Rating to Caa1
---------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on the
following notes issued by GSC European CDO II S.A.:

-- EUR16 million Class D1 Floating Rate Notes, Upgraded to Aa1
    (sf); previously on Oct 6, 2015 Upgraded to Baa1 (sf)

-- EUR2 million Class D2 Floating Rate Notes, Upgraded to Aa1
    (sf); previously on Oct 6, 2015 Upgraded to Baa1 (sf)

-- EUR10 million (Current Balance: EUR12,537,970.02) Combination
    Y, Upgraded to Caa1 (sf); previously on Oct 6, 2015 Affirmed
    Caa3 (sf)

Moody's has also affirmed the ratings on the following notes:

-- EUR16.5 million (Current Balance: EUR4,689,624.26) Class C1
    Floating Rate Notes, Affirmed Aaa (sf); previously on Oct 6,
    2015 Upgraded to Aaa (sf)

-- EUR11 million (Current Balance: EUR3,126,416.18) Class C2
    Fixed Rate Notes, Affirmed Aaa (sf); previously on Oct 6,
    2015 Upgraded to Aaa (sf)

-- EUR4 million (Current Balance: EUR5,264,903.06) Class E1
    Floating Rate Notes, Affirmed Caa1 (sf); previously on Oct 6,
    2015 Upgraded to Caa1 (sf)

-- EUR7.5 million (Current Balance: EUR11,306,955.03) Class E2
    Fixed Rate Notes, Affirmed Caa1 (sf); previously on Oct 6,
    2015 Upgraded to Caa1 (sf)

GSC European CDO II S.A., issued in June 2005, is a
collateralized loan obligation ("CLO") backed by a portfolio of
mostly high yield European loans. It is predominantly composed of
senior secured loans. The portfolio is managed by GSCP (NJ), L.P.
The transaction's reinvestment period ended in July 2010.



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


MONTE DEI PASCHI: Fitch Affirms B-/B IDRs, Outlook Stable
---------------------------------------------------------
Fitch Ratings has affirmed Banca Monte dei Paschi di Siena's
(MPS) Long-term Issuer Default Rating at 'B-', its Short-term IDR
at 'B', the Viability Rating (VR) at 'b-', the Support Rating
(SR) at '5' and the Support Rating Floor (SRF) at 'No Floor'.
The Outlook on the Long-term IDR is Stable.

                        KEY RATING DRIVERS

IDRS, VR AND SENIOR DEBT

MPS's IDRs, VR and senior debt ratings reflect the bank's very
weak asset quality and the pressure this exercises on its
capital. The ratings also reflect a liquidity position that was
under moderate pressure in the first months of 2016, the bank's
stronger capital position, following a EUR3 billion capital
increase in 2015, improved profitability and management's ability
to react to the recent deposit outflows and rebalance the bank's
liquidity profile.

MPS's capitalization strengthened in 2015 thanks to a EUR3 bil.
capital increase -- which followed a EUR5 bil. increase in 2014
-- and modest internal capital generation.  Following the capital
increase, the bank fully reimbursed the remaining EUR1 bil. of
government hybrids received as state aid in 2013.  The Common
Equity Tier 1 (CET1) ratio improved to 12% at end-2015 from 8.5%
at end-2014, and the Fitch core capital (FCC) ratio stood at an
adequate 11.6% at end-2015.  Despite acceptable risk-weighted
capital ratios, capitalization remains weak because of the very
high level of unreserved impaired loans, which accounted for
about 250% of FCC at end-2015 (despite materially decreasing from
an extremely high 400% at end-2014).

Impaired loans accounted for approximately 34% of gross loans at
end-2015, placing significant pressure on profitability and
capitalization.  MPS reported an operating profit of around
EUR600 mil. in 2015 after four years of heavy losses.  MPS sold
EUR2 bil. of impaired loans in two tranches in 2015, in line with
the business plan, and aims to dispose of another EUR3.5 bil.
over the next three years.

The improved performance was mostly driven by a sharp reduction
in Fitch-calculated loan impairment charges, to EUR2.6 bil. in
2015 (2014: EUR8.3 bil.) and lower operating costs of EUR2.7 bil.
(2015: EUR3.5 bil.) according to Fitch's calculation which
includes restructuring implementation expenses.  MPS's overall
performance will likely remain structurally weak in the medium
term, unless management undertakes significant actions to reduce
the stock of impaired loans through sales; even then, the bank
would still risk having to dispose of these below book value.

MPS suffered moderate deposit outflows in the first months of
2016 following the resolution of four Italian banks under special
administration in December 2015; this resulted in some depositors
withdrawing money from some of the weaker Italian banks,
including MPS.  The bank regained part of these deposit outflows
through effective commercial efforts and increased its activities
with institutional counterparties.  While deposits have now
stabilized and the liquidity position is acceptable, in Fitch's
opinion, MPS's liquidity position has proven itself highly
vulnerability to market events.

             SUPPORT RATING AND SUPPORT RATING FLOOR

The SR and SRF reflect Fitch's view that senior creditors can no
longer expect to receive full extraordinary support from the
sovereign in the event that a bank becomes non-viable.  The EU's
Bank Recovery and Resolution Directive (BRRD) and the Single
Resolution Mechanism (SRM) for eurozone banks provide a framework
for the resolution of banks which requires senior creditors to
participate in losses, if necessary, instead of or ahead of a
bank receiving sovereign support.

           SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other issued hybrid capital are notched
down from the VR, in accordance with Fitch's assessment of each
instrument's respective non-performance and relative loss
severity risk profiles.

The ratings of MPS's Lower Tier 2 and Upper Tier 2 debt reflect a
high risk of non-performance.  The 'C' ratings of its Tier 1
instruments and preferred securities reflect their non-
performance and Fitch's expectation that the securities are
unlikely to resume coupon payments in the near future.

                   SENIOR STATE-GUARANTEED DEBT

The Long-term rating of MPS's state-guaranteed debt is based on
Italy's direct, unconditional and irrevocable guarantee for the
issues, which covers payments of both principal and interest.
Italy's guarantee was issued by the Ministry of Economy and
Finance under Law Decree Dec. 6, 2011, n.201, subsequently
converted into Law Dec. 22, 2011, n. 214.

The ratings reflect Fitch's expectation that Italy will honor the
guarantee provided to the noteholders in a full and timely
manner. The state guarantee ranks pari passu with Italy's other
unsecured and unguaranteed senior obligations.  As a result, the
notes' Long-term ratings are in line with Italy's 'BBB+' Long-
term IDR.

                        RATING SENSITIVITIES

IDRS, VR AND SENIOR DEBT

MPS's VR, IDR and senior debt ratings would be downgraded if the
bank fails to gradually improve its asset quality and reduce the
stock of impaired loans.  Deposit outflows of a magnitude that
placed unmanageable pressure on the group's liquidity position
would also trigger a downgrade.

An upgrade of the ratings would require a material improvement in
asset quality and evidence of sustainable earnings generation
capabilities.

           SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

The ratings are primarily sensitive to a change in the VR, but
also to a change in Fitch's view of non-performance or loss
severity risk relative to the bank's viability.

                   SENIOR STATE-GUARANTEED DEBT

The notes' Long-term ratings are sensitive to changes in Italy's
Long-term IDR.  Any downgrade or upgrade of Italy's Long-term IDR
would be reflected in the notes' Long-term ratings.

                             SR AND SRF

An upgrade of the SR and any upward revision of the SRF would be
contingent on a positive change in the sovereign's propensity to
support MPS.  While not impossible, this is highly unlikely, in
Fitch's view.

The rating actions are:

  Long-term IDR: affirmed at 'B-'; Outlook Stable
  Short-term IDR: affirmed at 'B'
  VR: affirmed at 'b-'
  Support Rating: affirmed at '5'
  Support Rating Floor: affirmed at 'No Floor''
  Debt issuance program (senior debt): affirmed at 'B-', 'RR4'
  Senior unsecured debt: affirmed at 'B-', 'RR4'
  Lower Tier 2 subordinated debt: affirmed at 'CCC', 'RR5'
  Upper Tier 2 subordinated debt: affirmed at 'CC', 'RR6'
  Preferred stock and Tier 1 notes: affirmed at 'C', 'RR6'
  State-guaranteed debt (IT0004804362): affirmed at 'BBB+'



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


KAZAKHSTAN TEMIR: S&P Puts 'BB' CCR on CreditWatch Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB' long-term
corporate credit rating on Kazakhstan's national railroad
company, Kazakhstan Temir Zholy (KTZ), and its core subsidiary,
freight-wagon owner JSC Kaztemirtrans (KTT), on CreditWatch with
negative implications.  S&P also placed its 'kzA' Kazakhstan
national scale rating on KTZ on CreditWatch negative.

The CreditWatch placement primarily reflects that KTZ has not yet
secured refinancing for its $350 million notes that mature on
May 11, 2016.  S&P may lower the ratings on KTZ by more than one
notch if the company fails to seal the refinancing deal over the
coming weeks.  In S&P's view, with less than one month remaining
before the maturity date, KTZ's ability to finalize the
transaction is vulnerable to any further delays in its
negotiations with creditors or delays for any other reason.

S&P nevertheless understands that the company has been working to
refinance the notes for some time and that it is in the late
stage of this process.  Additionally, S&P estimates that KTZ had
about $320 million (Kazakhstani tenge 109 billion) of cash and
cash equivalents as of Jan. 1, 2016, which continue to be
available to the company and could be used for refinancing
purposes if part of external financing is delayed for any reason.

S&P continues to assess KTZ's stand-alone credit profile (SACP)
at 'b' reflecting the company's strong market position in
Kazakhstan but its exposure to commodity traffic volatility.  The
company's SACP also reflects its high leverage, stemming from
inflation of its foreign currency debt and lower EBITDA
generation, reflecting the fall in cargo transportation volumes.
S&P estimates that KTZ's Standard & Poor's-adjusted debt to
EBITDA ratio stood at 8.0x-8.5x, and funds from operations (FFO)
to debt at 5.0%-8.0%, at the end of 2015.  S&P expects adjusted
debt to EBITDA to remain above 5x and FFO to debt to stay below
12% over the next 12 months.

S&P's rating on KTZ also incorporates S&P's assumption that there
is a very high likelihood that KTZ's owner, the government of
Kazakhstan, would be able to provide extraordinary support to the
company should it be needed to meet the maturing obligations.

The CreditWatch negative placement reflects the possibility that
S&P could lower the rating by more than one notch if the company
does not finalize the refinancing deal over the next few weeks or
is unable to accumulate the full amount to repay the notes
falling due in May. S&P' plans to resolve the CreditWatch over
the coming weeks, once it has a clear view whether the company
will be able to repay maturing notes on time or not.



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P O L A N D
===========


KOMPANIA WEGLOWA: Private Lenders Oppose Rescue Plan
----------------------------------------------------
Marcin Goclowski and Agnieszka Barteczko at Reuters report that
Poland's efforts to agree a debt-for-equity swap with creditors
to rescue troubled miner Kompania Weglowa (KW) have run into
opposition from private lenders involved in the discussions.

The government secured agreement on April 19 from trade unions to
additional cost-cutting measures as part of a plan that also
relies on cash support from state-owned utility companies and had
hoped a deal with its creditor banks would help to navigate
European Union rules on state aid, Reuters relates.

Record-low coal prices and high labor costs have taken KW to the
brink of bankruptcy, with its cash expected to run out this
month, underscoring the deepening financial problems of Poland's
coal sector, Reuters relays.

KW's creditors include BZ WBK, the Polish business of Spain's
Banco Santander, and France's BGZ BNP Paribas, as well as
state-run lenders PKO BP , BGK and Alior Bank, Reuters discloses.

"The (private) banks have not agreed to the conversion.  From
what I know, the energy minister is now looking for another
solution," Reuters quotes one banking source as saying.

A second banking source, as cited by Reuters, said that BZ WBK
has blocked the deal and that BGZ works hand in hand with
Santander's Polish business.

Sources have said that those banks hold PLN150 million (US$39.84
million) of KW's debt, Reuters notes.

According to Reuters, a government source said that talks are
continuing and that there is no problem with the banks.  Another
source close to the state-run lenders said that a deal could
still materialize in a couple of weeks, Reuters relates.

Kompania Weglowa is a Polish coal producer.



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R O M A N I A
=============


TRANSELECTRICA SA: Moody's Hikes Corporate Family Rating to Ba1
---------------------------------------------------------------
Moody's Investors Service upgraded to Ba1 from Ba2 the corporate
family rating (CFR) and to Ba1-PD from Ba2-PD the probability of
default rating of Romanian electricity transmission system
operator Transelectrica S.A. Moody's has also upgraded its view
of Transelectrica's standalone credit quality, as expressed by
the company's baseline credit assessment (BCA), to ba2 from b1.
The outlook on the ratings is stable.

RATINGS RATIONALE

The upgrade reflects the improved revenue stability and cost
recovery mechanisms embedded within the current third regulatory
period and the consequent improved visibility of Transelectrica's
revenue and costs over the current regulatory period. The
regulatory building blocks and the regulatory input assumptions
have evolved and are expected to allow the company to manage its
capital expenditure program within a risk profile commensurate
with a Ba1 rating. The rating upgrade also reflects the improving
financial profile given the changes to the company's financial
covenant package and improved liquidity position. Given the low
leverage of Transelectrica, Moody's expects that the company will
maintain robust credit metrics until at least the end of the
present regulatory cycle ending June 30, 2019.

The Ba1 rating reflects (1) Transelectrica's low and improved
business risk profile associated with its natural monopoly as
Romania's fully regulated electricity transmission grid owner and
operator; and (2) its strong financial profile with modest debt
levels. However, the rating remains constrained by (1) the
developing nature of the regulatory regime in Romania, which
still lacks a long term track record of transparent and
consistent application, compared to western European
counterparts; and (2) the company's exposure to foreign exchange
risk on its foreign currency denominated debt and its high
percentage of floating rate debt. Transelectrica is
underleveraged compared to its counterparts elsewhere in Europe,
and the company's future leverage and dividend policy, as well as
the regulator's view of its capital structure in future
regulatory settlements, will be important drivers of future
rating changes.

"Transelectrica falls under Moody's rating methodology for
Government-Related Issuers given its 58.7% ownership by the
Government of Romania (Baa3 positive). The Ba1 CFR incorporates a
one-notch uplift to the group's BCA of ba2. The uplift applied to
the BCA is explained by the strategic importance of the company
to the country of Romania. Considering the majority ownership by
the state and the credit quality of Romania, we expect there to
be strong likelihood of extraordinary support from the government
in case of financial distress at the company."

RATIONALE FOR THE STABLE OUTLOOK

The rating outlook is stable, reflecting Moody's expectation that
Transelectrica will continue to operate with a financial profile
commensurate with the current rating.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward rating pressure could develop if (1) Transelectrica was
able to demonstrate a longer track record of a stabilized
operating and cash flow profile, which may be achieved through
the ongoing development of the regulatory environment and
consistent application of regulatory principles; (2) exposure to
foreign-denominated debt was reduced, which could be achieved
through hedging and/or through a larger share of RON denominated
debt, or (3) the credit quality of the Government of Romania was
to strengthen considerably.

The rating could come under downward pressure if (1)
Transelectrica's financial profile was to weaken materially
through a significant increase in debt leverage; (2) the
liquidity profile of the company was to deteriorate; or (3) there
was a weakening in the credit quality of the Government of
Romania and/or a reduction in the support assumptions currently
incorporated into Moody's assessment.

Headquartered in Bucharest, Transelectrica S.A. is the operator
of Romania's 8,834 km high-voltage electricity transmission
network. Transelectrica is a publicly traded company, listed on
the Bucharest Stock Exchange, and the Romanian Government is the
majority shareholder with a stake of around 59%. For the twelve
months ended December 31, 2015, Transelectrica reported revenues
of RON3.0 billion and Operating Profit of RON441 million.



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


ENERGOMASH: Creditors Lose Bid to Annual Retrial Ruling
-------------------------------------------------------
Sergei Blagov at Bloomberg BNA reports that the Russian Supreme
Court released Ruling No. 310-ES14-6825 in connection with Case
No. A08-9664/2009 of the Belgorod regional court.

On Sept. 20, 2015, the Arbitration Court of Appeal ordered a
retrial in a case involving alleged violations by the interim
manager in Energomash bankruptcy proceedings, Bloomberg BNA
relates.  A representative of the meeting of creditors petitioned
the Supreme Court for annulment of the retrial ruling, Bloomberg
BNA relays.

However, in Ruling No. 310-ES14-6825, the Supreme Court dismissed
the petition and upheld the retrial ruling as not being at
variance with bankruptcy legislation, Bloomberg BNA discloses.

Energomash Group is a power-related machinery manufacturer.


EVROKREDIT LLC: Liabilities Exceed Assets, Inspection Reveals
-------------------------------------------------------------
The provisional administration of Evrokredit LLC appointed by
Bank of Russia Order No. OD-3465, dated December 4, 2015, due to
the revocation of its banking license, encountered an obstruction
of its activity starting the first day of performing its
functions.

The management of Evrokredit LLC failed to submit to the
provisional administration electronic databases and loan
agreements for loans recorded on the bank's balance sheet in the
amount of about RUR480 million, which can point to an attempt to
conceal episodes of asset diversion from the bank.  Furthermore,
the provisional administration discovered deliberate erasure of
electronic databases and banks' IT systems.

The provisional administration has revealed transactions which
resulted in a deterioration of the bank's financial standing,
lost of liquid funds in the amount exceeding RUR390 million,
aimed at diverting the bank's assets, as well as bank's property
sale transactions worth over RUR1.1 billion.

According to the estimate by the provisional administration, the
assets of Evrokredit LLC do not exceed RUR714 million, whereas
the bank's liabilities to its creditors amount to RUR2267
million.

On January 26, 2016, the Court of Arbitration of the city of
Moscow ruled to recognize Evrokredit LLC insolvent (bankrupt) and
initiate bankruptcy proceedings with the state corporation
Deposit Insurance Agency appointed as a receiver.

The Bank of Russia submitted the information on the financial
transactions bearing the evidence of the criminal offence
conducted by the former management and owners of Evrokredit LLC
to the Prosecutor General's Office of the Russian Federation, the
Ministry of Internal Affairs of the Russian Federation and the
Investigative Committee of the Russian Federation for
consideration and procedural decision making.


FAR-EASTERN SHIPPING: Fitch Lowers Issuer Default Rating to CC
--------------------------------------------------------------
Fitch Ratings has downgraded Russia-based Far-Eastern Shipping
Company Plc's (FESCO) Long-term foreign currency Issuer Default
Rating to 'CC' from 'B-'.  Fitch has also downgraded FESCO's
foreign currency senior unsecured rating to 'C' from 'B-' on weak
recovery prospects.  The Recovery Rating is RR6.

The downgrade reflects FESCO's weak liquidity, continued
deterioration of operational performance, weaker cash generation,
and exposure to a contracting economy and rouble exchange rate
volatility.  Fitch expects the company's financial performance to
have deteriorated in 2015 and that an improvement in 2016 is
uncertain.

Although FESCO has reduced its planned investments to a minimum
in response to a tough market, Fitch expects its funds from
operations (FFO) adjusted net leverage to increase to above 10x
on average over 2015-2018.  FESCO may struggle with debt and
interest/coupon repayments as a result of weaker cash flows
generation.

                         KEY RATING DRIVERS

Insufficient Liquidity

Fitch assessed FESCO's liquidity position at end-3Q15 as
insufficient for debt coverage over 4Q15-2016.  The company's
cash and cash equivalents of USD68 million at end-3Q15 and Fitch-
projected 4Q15-2016 negative free cash flows (FCF) do not cover
expected maturities and coupon/interest payments over 4Q15-2016
of about USD150 mil. and about USD125 mil., respectively.  Fitch
estimates that FESCO may cover its near-term maturities, Eurobond
and local bonds coupon payments, but may struggle with further
debt and interest/coupon repayments in 2H16.

Given the upcoming interest/coupon payments and debt maturities
and continuing weak operating cash flows, we believe a debt
restructuring is in prospect in 2H16.  This is likely to lead to
a further downgrade.

Financial covenants in the Eurobond documentation (i.e. fixed
charge coverage ratio at 2.0x or higher and consolidated total
leverage ratio of less than 3.25x) limit FESCO's ability to incur
additional debt over certain limits but their breach does not
constitute an event of default.

Low Coverage, High Leverage

At end-3Q15, FESCO's debt stood at USD921 million.  Fitch has
also included USD220 million Eurobonds that were bought back in
May 2015 in its adjusted debt calculations as these Eurobonds
were pledged as a collateral under USD44 mil. loan agreement
provided by an international bank for funding the Eurobond
buyback and should be released back to FESCO upon the final
fulfillment of obligations under this loan in February 2018.

Fitch expects FESCO's FFO adjusted net leverage to increase to
above 10x over 2015-2018 from slightly above 6x at end-2014 on
the back of deteriorating operational performance.  Fitch expects
FESCO to report negative FFO over 2016-2018 due to lower
operational cash flows, resulting in FFO interest coverage
falling to below 1x over 2015-2018, from slightly above 1x at
end-2014.

Weak Market Fundamentals, Earnings Pressure

The Russian transportation market remained under pressure in 2015
from a contracting domestic economy and rouble depreciation,
which affected import and transit transportation volumes and
consumer purchasing power.  The container throughput in the Far
East ports and rail container transportation in Russia declined
24% and 8% yoy in 2015, respectively.  This has negatively
affected FESCO's operational performance in all business
segments.

In 9M15, FESCO's port container volumes, intermodal
transportation volumes and rail container transportation volumes
fell 32%, 23% and 11%, respectively.  Fitch expects FESCO's 2015
revenue and EBITDA to drop by about 40% and 30% yoy,
respectively, driven by lower volumes and rates.  Fitch expects
2016 to be another challenging year for container transportation
as we forecast Russian GDP to decline further by 1.5% and for
rouble to remain weak.

FX Risks Still High

Despite the buyback of foreign denominated debt in May 2015 and
conversion of certain port tariffs to US dollars from rouble at
end-2014, FESCO remains exposed to foreign currency fluctuations
as 84% of its total debt at end-3Q15 was denominated in foreign
currencies, mainly in US dollars.  In contrast, about 60% of
revenues in 9M15 were US dollar-linked or US dollar-denominated.

Negative FCF Expected

Despite significant reduction in capex to a maintenance level of
about USD20 mil. annually versus USD62m on average over 2012-2014
we expect FESCO to generate negative FCF.  This is mainly due to
weaker cash generation from operations on the back of falling
volumes, continued pressure on rates and high interest/coupon
payments on debt.  Fitch does not expect operating cash flows to
improve in 2016.

                         KEY ASSUMPTIONS

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

   -- Russian GDP decline of 3.7% in 2015 and 1.5% in 2016 and
      growth of 1.5% in 2017; Chinese GDP growth of 6%-6.9% over
      2015-2017
   -- Russian CPI of 6.8%-12.9% over 2015-2017
   -- No dividends payments
   -- Capex of about USD20 mil. annually over 2015-2017
   -- USD/RUB exchange rate of 70-75 over 2015-2017

                       RATING SENSITIVITIES

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

   -- Imminent or inevitable default or standstill of the issuer

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

   -- Attaining a more sustainable liquidity profile
   -- Improvement of the macro-economic environment and company's
      operational performance

                   FULL LIST OF RATING ACTIONS

Far-Eastern Shipping Company Plc

   -- Long-term foreign currency IDR downgraded to 'CC' from
      'B-'/Negative

   -- Long-term local currency IDR downgraded to 'CC' from
      'B-'/Negative

   -- National Long-term rating downgraded to 'CC(rus)' from
      'BB-(rus)'/Negative

   -- Local currency senior unsecured rating downgraded to 'C'
      with a Recovery Rating of 'RR6' from 'B-'/'RR4'

Far East Capital Limited S.A. (Luxembourg)

   -- Foreign currency senior unsecured rating downgraded to
      'C'/RR6 from 'B-'/'RR4'


KROSSINVESTBANK OJSC: Placed Under Provisional Administration
-------------------------------------------------------------
The Bank of Russia, by its Order No. OD-1199, dated April 11,
2016, revoked the banking license of credit institution JSCB
KROSSINVESTBANK OJSC from April 11, 2016.

The Bank of Russia took such an extreme measure -- revocation of
the banking license -- because of the credit institution's
failure to comply with federal banking laws and Bank of Russia
regulations, repeated violations within a year of Bank of Russia
regulations issued in accordance with the Federal Law "On
Countering the Legalisation (Laundering) of Criminally Obtained
Incomes and the Financing of Terrorism", and the application of
measures envisaged by the Federal Law "On the Central Bank of the
Russian Federation (Bank of Russia)", considering a real threat
to the creditors' and depositors' interests.

With its poor asset quality, JSCB KROSSINVESTBANK OJSC failed to
adequately assess the risks assumed.  An adequate assessment of
the credit risk and a reliable recognition of the bank's assets
resulted in the grounds for the credit institution to implement
measures to prevent the bank's insolvency (bankruptcy).  Besides,
the bank failed to meet the requirements of Bank of Russia
regulations on countering the legalization (laundering) of
criminally obtained incomes and the financing of terrorism,
including customer identification procedure, and also the
credible notification of the authorized body about operations
subject to obligatory control.  JSCB KROSSINVESTBANK OJSC was
involved in dubious operations.

The management and owners of the bank failed to take effective
measures to bring the situation back to normal.  Under these
circumstances, the Bank of Russia took a decision to revoke the
banking license of JSCB KROSSINVESTBANK OJSC.

The Bank of Russia, by its Order No. OD-1200, dated April 11,
2016, has appointed a provisional administration to JSCB
KROSSINVESTBANK OJSC for the period until the appointment of a
receiver pursuant to the Federal Law "On the Insolvency
(Bankruptcy)" or a liquidator under Article 23.1 of the Federal
Law "On Banks and Banking Activities".  In accordance with
federal laws, the powers of the credit institution's executive
bodies are suspended.

JSCB KROSSINVESTBANK OJSC is a member of the deposit insurance
system.  The revocation of the banking license is an insured
event as stipulated by Federal Law No. 177-FZ "On the Insurance
of Household Deposits with Russian Banks" in respect of the
bank's retail deposit obligations, as defined by law.  The said
Federal Law provides for the payment of indemnities to the bank's
depositors, including individual entrepreneurs, in the amount of
100% of the balance of funds but no more than RUR1.4 million per
one depositor.

According to the financial statements, as of April 1, 2016, JSCB
KROSSINVESTBANK OJSC ranked 446th by assets in the Russian
banking system.


SOVEREIGN-AUTO: High Court Affirms Fine Against Interim Manager
---------------------------------------------------------------
Sergei Blagov at Bloomberg BNA reports that the Russian Supreme
Court released Ruling No. 310-AD16-1825 in connection with
Case No. A-36-6183/2014 of the Lipetsk regional court.

On Oct. 8, 2015, the Lipetsk regional arbitration court in
Southern Russia imposed a fine of RUR25,000 (US$381) on
Sergei Yevtushenko, interim manager involved in Sovereign-Auto
bankruptcy proceedings, Bloomberg BNA relates.  The fine followed
alleged violations of bankruptcy legislation and insolvency
procedures, including improper publication of bankruptcy
information and failure to follow procedures for calling and
holding meetings of creditors, Bloomberg BNA relays.

In Ruling No. 310-AD16-1825, the Supreme Court determined that
Mr. Yevtushenko violated bankruptcy legislation and insolvency
procedures, upheld rulings of lower courts and dismissed the
petition for annulment of these rulings, Bloomberg discloses.


ZERNOBANK JSC: Liabilities Exceed Assets, Inspection Shows
----------------------------------------------------------
The provisional administration of JSC Zernobank appointed by Bank
of Russia Order No. OD-2355, dated September 24, 2015, due to the
revocation of its banking license, revealed operations of the
former management of the bank, given the solvency problems, that
consisted in receivables assignment to some creditors at the
expense of the others in the amount of over RUR600 million.

Moreover, the administration discovered the operations worth over
RUR400 million involving transformation of creditors' claims in
order to satisfy the claims in preference order.

According to the provisional administration estimates, the assets
of JSC Zernobank do not exceed RUR1.1 billion, whereas the bank's
liabilities to its creditors amount to RUR1.5 billion.

On December 1, 2015, the Court of Arbitration of the Altai
Territory took a decision to recognize JSC Zernobank insolvent
(bankrupt) and initiate bankruptcy proceedings with the state
corporation Deposit Insurance Agency appointed as a receiver.

The Bank of Russia submitted the information on the financial
transactions bearing the evidence of the criminal offence
conducted by the former management and owners of JSC Zernobank to
the Prosecutor General's Office of the Russian Federation and the
Ministry of Internal Affairs of the Russian Federation for
consideration and procedural decision making.



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


BANCO BPI: Moody's Puts 'Ba3' Rating on Review Uncertain
--------------------------------------------------------
Moody's Investors Service has taken the following rating actions
on both mortgage and public sector covered bonds issued by Banco
BPI S.A. (the issuer/Banco BPI) (deposits Ba3 on review
uncertain; adjusted baseline credit assessment b1 on review
uncertain; counterparty risk (CR) assessment Ba2(cr) on review
uncertain), governed by the Portuguese covered bond legislation:

-- Banco BPI S.A., Mortgage Covered Bonds: A3 rating placed on
    review with direction uncertain

-- Banco BPI Public Sector - Covered Bonds: Baa1 rating placed
    on review with direction uncertain

RATINGS RATIONALE

This rating action follows Moody's decision to place Banco BPI's
Ba2(cr) Counterparty Risk (CR) Assessment on review with
direction uncertain.

KEY RATING ASSUMPTIONS/FACTORS

Moody's determines covered bond ratings using a two-step process:
an expected loss analysis and a TPI framework analysis.

EXPECTED LOSS: Moody's uses its Covered Bond Model (COBOL) to
determine a rating based on the expected loss on the bond. COBOL
determines expected loss as (1) a function of the probability
that the issuer will cease making payments under the covered
bonds (a CB anchor event); and (2) the stressed losses on the
cover pool assets following a CB anchor event.

The CB anchor for these programs is CR assessment plus 1 notches.
The CR assessment reflects an issuer's ability to avoid
defaulting on certain senior bank operating obligations and
contractual commitments, including covered bonds.

The cover pool losses for Banco BPI mortgage covered bonds are
20.4%. This is an estimate of the losses Moody's currently models
following a CB anchor event. Moody's splits cover pool losses
between market risk of 15.4% and collateral risk of 5%. Market
risk measures losses stemming from refinancing risk and risks
related to interest-rate and currency mismatches (these losses
may also include certain legal risks). Collateral risk measures
losses resulting directly from cover pool assets' credit quality.
Moody's derives collateral risk from the collateral score, which
for this program is currently 7.5%.

The over-collateralization in the cover pool is 38.8%, of which
Banco BPI provides 5.3% on a "committed" basis. The minimum OC
level consistent with the A3 rating target is 2.5%, of which the
issuer should provide 0.5% in a "committed" form. These numbers
show that Moody's is not relying on "uncommitted" OC in its
expected loss analysis.

The cover pool losses for Banco BPI Public Sector - covered bonds
are 50%. This is an estimate of the losses Moody's currently
models following a CB anchor event. Moody's splits cover pool
losses between market risk of 38% and collateral risk of 12%.
Market risk measures losses stemming from refinancing risk and
risks related to interest-rate and currency mismatches (these
losses may also include certain legal risks). Collateral risk
measures losses resulting directly from cover pool assets' credit
quality. Moody's derives collateral risk from the collateral
score, which for this program is currently 24%.

The over-collateralization in the cover pool is 40.3%, of which
Banco BPI provides 7% on a "committed" basis. The minimum OC
level consistent with the Baa1 rating target is 31.5%, of which
the issuer should provide 6% in a "committed" form. These numbers
show that Moody's is relying on "uncommitted" OC in its expected
loss analysis.

TPI FRAMEWORK: Moody's assigns a "timely payment indicator"
(TPI), which measures the likelihood of timely payments to
covered bondholders following a CB anchor event. The TPI
framework limits the covered bond rating to a certain number of
notches above the CB anchor.

For the mortgage covered bonds issued by Banco BPI, Moody's has
assigned a TPI of Improbable.

For the public sector covered bonds issued by Banco BPI, Moody's
has assigned a TPI of Very improbable.

Factors that would lead to an upgrade or downgrade of the
ratings:

The CB anchor is the main determinant of a covered bond program's
rating robustness. A change in the level of the CB anchor could
lead to an upgrade or upgrade of the covered bonds. The TPI
Leeway measures the number of notches by which Moody's might
lower the CB anchor before the rating agency upgrades the covered
bonds because of TPI framework constraints.

The TPI assigned to Banco BPI mortgage covered bonds is
Improbable. The TPI Leeway for this program is 0 notches. This
implies that Moody's might upgrade the covered bonds because of a
TPI cap if it lowers the CB anchor by one notch, all other
variables being equal.

The TPI assigned to Banco BPI Public Sector -- Covered Bonds is
Very Improbable. The TPI Leeway for this program is 0 notches.
This implies that Moody's might upgrade the covered bonds because
of a TPI cap if it lowers the CB anchor by one notch, all other
variables being equal.

A multiple-notch upgrade of the covered bonds might occur in
certain circumstances, such as (1) a country ceiling or sovereign
upgrade capping a covered bond rating or negatively affecting the
CB Anchor and the TPI; (2) a multiple-notch upgrade of the CB
Anchor; or (3) a material reduction of the value of the cover
pool.


CAIXABANK SA: Moody's Affirms Ba2 Subordinated Debt Ratings
-----------------------------------------------------------
Moody's Investors Service affirmed the following ratings of
CaixaBank, S.A. (CaixaBank): (1) The Baa2 senior debt and
Baa2/Prime-2 deposit ratings; (2) the Ba2 subordinated debt
ratings; (3) the bank's baseline credit assessment (BCA) and
adjusted BCA of ba1; and (4) its Counterparty Risk Assessment
(CRA) of Baa1(cr)/Prime-2(cr). The outlook for the long-term
senior debt and deposit ratings was changed to negative.

At the same time, Moody's has placed on review with direction
uncertain the following ratings of Banco BPI S.A. (BPI) and its
supported entities: (1) The Ba3 long-term senior debt and deposit
ratings; (2) the B2 subordinated debt ratings; (3) the (P)B3
junior subordinated program ratings; (4) the backed Caa1(hyb)
preference shares; (5) the bank's adjusted baseline credit
assessment (BCA) of b1; and (6) its long-term Counterparty Risk
Assessment (CRA) of Ba2(cr). BPI's BCA of b1 which was placed on
review for downgrade on March 22, 2016, its short-term Not Prime
deposit and senior debt ratings and short-term Not Prime(cr) CRA
were not affected and remain unchanged.

The rating actions were triggered by CaixaBank's announcement on
April 18, 2016 to launch a public tender offer for the
acquisition of BPI's not-yet-owned share capital (CaixaBank
currently holds a 44.1% stake in BPI), and Moody's assessment of
the negative impact the deal could have on CaixaBank's solvency
and credit risk profile. The review with direction uncertain of
BPI's debt and deposit ratings indicates different rating
pressures which are dependent on the closing of CaixaBank's
tender offer for BPI. Moody's considers that BPI's senior
creditors could benefit from CaixaBank's affiliate support
following the successful completion of the tender offer therefore
mitigating the risks emerging from the bank's weak standalone
credit profile, which remains on review for downgrade. However,
if the tender offer fails to succeed, BPI's senior creditors
could be negatively impacted by the ongoing pressures on its
financial profile.

The rating action on BPI extends the period for reviewing the
bank's ratings which was opened on March 11, 2016.

RATINGS RATIONALE

-- RATIONALE FOR THE AFFIRMATION WITH A NEGATIVE OUTLOOK ON
    CAIXABANK'S RATINGS

In affirming CaixaBank's BCA and ratings and assigning negative
outlooks to the long-term debt and deposit ratings, Moody's
reflects the bank's overall credit profile and its resiliency to
a potential acquisition of BPI subject to certain expectations
being met, the most relevant being the restoration of the group's
solvency metrics post acquisition.

The rating action reflects CaixaBank's (total assets of EUR344.3
billion at end-December 2015) intention to launch a public tender
offer for BPI's (total assets of EUR40.7 billion at end-December
2015) capital and the negative impact it may have on CaixaBank's
solvency levels. Depending on the level of acceptance of the
tender offer, the effect on CaixaBank's solvency levels could
range from 97 to 146 basis points on its fully loaded Common
Equity Tier 1 (FL CET1) ratio. The acquisition could thus bring
down CaixaBank's FL CET 1 ratio to 10.6%-10.1% from 11.6%
reported at end-December 2015. Moody's notes positively
CaixaBank's commitment to maintain a FL CET1 ratio of between 11%
and 12% post-transaction and the rating agency expects remedial
actions by the bank to maintain its committed capital ratios.
However, in addition to regulatory capital levels, Moody's will
also assess the impact of the announced transaction on Moody's
key capital metric, the Tangible Common Equity ratio (TCE), which
stoods at 10.9% at end-December 2015 and is already under
pressure due to the asset swap agreement with CaixaBank's holding
company (Criteria).

The negative outlook also reflects the uncertainty regarding the
remedial actions to solve BPI's breach of the regulatory large
exposure limits, in relation to its exposure to Angola (Ba2
review for downgrade) and the impact that this situation may have
on BPI's credit profile and ultimately on CaixaBank's
creditworthiness. This concern triggered the rating action on
BPI's ratings published on 22 March 2016.

CaixaBank has requested the suspension of any sanction
proceedings for excess risk concentration in Angola to the
European Central Bank (ECB) to allow CaixaBank to find a solution
for BPI's African operations (for which a demerger plan was
presented in 2014 and has failed to be approved on various
occasions to date).

The success of this deal is subject not only to pertinent
regulatory approvals, but also to meeting the following
conditions: (1) Achieving more than a 50% stake in BPI after the
offer; and (2) the elimination of the 20% voting cap currently
included in BPI's bylaws.

This offer is voluntary, with a price of EUR1.113 per share
payable in cash, and is directed to all the outstanding shares of
BPI that CaixaBank does not hold.

Moody's will assess the impact on CaixaBank's credit profile of
the announced transaction once it will be closed, and it gains
visibility on the effective solution of BPI's large exposures in
Angola and any capital strengthening measures to be adopted by
the bank. Moody's will also focus on BPI's future earning
generation capacity which currently is heavily reliant on its
Angola operations and income from financial securities against a
backdrop of a challenging Portuguese operating environment.

BPI represents 12% of CaixaBank's 2015 total assets and close to
18% of Moody's adjusted risk-weighted assets.

-- RATIONALE FOR THE REVIEW WITH DIRECTION UNCERTAIN OF BPI'S
    RATINGS

The review with direction uncertain of BPI's ratings reflects the
potential upward pressure on BPI's debt and deposit ratings that
could stem from the acquisition by CaixaBank. Moody's considers
that BPI senior creditors could benefit from CaixaBank's
affiliate support following the successful completion of the
tender offer, therefore mitigating the risks emerging from the
bank's weak standalone credit profile, which remains on review
for downgrade. Downward pressure could also develop for BPI's
debt and deposit ratings if CaixaBank's fails to take control of
BPI's capital.

BPI's standalone b1 BCA remains on review for downgrade,
highlighting Moody's view that downside risks to the bank's
credit profile stem from the lack of a solution for its large
exposures to the Angolan state and the National Bank of Angola.
These exposures, standing at EUR3.6 billion and EUR1.3 billion,
respectively, exceed the limit to large exposures by EUR3.0
billion and EUR0.2 billion. The extended review for downgrade of
BPI's BCA also highlights the heightened wider risks for the bank
following Moody's recent review for downgrade of Angola's Ba2
sovereign bonds rating.

Moody's notes positively that BPI's current corporate governance
should improve following the removal of the current voting cap
imposed to shareholders which CaixaBank has imposed as a pre-
condition for the tender offer to succeed.

-- WHAT COULD CHANGE THE RATINGS UP/DOWN

Upward pressure on CaixaBank's ratings is unlikely given the
current negative outlook. Downward pressure could materialize if
CaixaBank fails to restore its solvency and/or its standalone
credit profile weakens as a result of acquiring a smaller but
significantly weaker institution.

An upgrade of BPI's debt and deposit ratings could arise if
CaixaBank's acquisition materializes and Moody's factors
affiliate support into BPI's ratings. Downward pressure on BPI's
debt and deposit ratings could develop if the bank's BCA is
downgraded and /or the announced tender offer fails to succeed.

BPI's BCA could be downgraded if it fails to achieve a solution
to reduce its very large risk exposures to Angola, and/or its
standalone credit profile is affected by a worsening of economic
conditions in Angola.

LIST OF AFFECTED RATINGS

Issuer: Banco BPI S.A.

-- Placed on Review Direction Uncertain (previously on Review
    for Downgrade):

-- Adjusted Baseline Credit Assessment, currently b1

-- Issuer Rating, currently Ba3, outlook Ratings Under Review

-- Junior Subordinate Medium-Term Note Program, currently (P)B3

-- Subordinate Medium-Term Note Program, currently (P)B2

-- Senior Unsecured Medium-Term Note Program, currently (P)Ba3

-- Subordinate Regular Bond/Debenture, currently B2

-- Senior Unsecured Regular Bond/Debenture, Ba3, outlook Ratings
    Under Review

-- Long-term Deposit Ratings, currently Ba3, outlook Ratings
    Under Review

-- Long-term Counterparty Risk Assessment, currently Ba2(cr)

-- Outlook Actions:

-- Outlook remains at Ratings Under Review

Issuer: BPI Capital Finance Ltd.

-- Placed on Review Direction Uncertain (previously on Review
    for Downgrade):

-- Backed Junior Subordinate Medium-Term Note Program, currently
    (P)B3

-- Backed Subordinate Medium-Term Note Program, currently (P)B2

-- Backed Senior Unsecured Medium-Term Note Program, currently
    (P)Ba3

-- Backed Pref. Stock Non-cumulative, currently Caa1 (hyb)

-- Outlook Actions:

-- Outlook remains at Ratings Under Review

Issuer: Banco BPI Cayman Ltd

-- Placed on Review Direction Uncertain (previously on Review
    for Downgrade):

-- Backed Junior Subordinate Medium-Term Note Program, currently
    (P)B3

-- Backed Subordinate Medium-Term Note Program, currently (P)B2

-- Backed Senior Unsecured Medium-Term Note Program, currently
    (P)Ba3

-- Outlook Actions:

-- Outlook remains at Ratings Under Review

Issuer: Banco BPI S.A. (Cayman)

-- Placed on Review Direction Uncertain (previously on Review
    for Downgrade):

-- Long-term Counterparty Risk Assessment, currently Ba2(cr)

-- Junior Subordinate Medium-Term Note Program, currently (P)B3

-- Subordinate Medium-Term Note Program, currently (P)B2

-- Senior Unsecured Medium-Term Note Program, currently (P)Ba3

-- Subordinate Regular Bond/Debenture, currently B2

-- Senior Unsecured Regular Bond/Debenture, currently Ba3,
    outlook Ratings Under Review

-- Outlook Actions:

-- Outlook remains at Ratings Under Review

Issuer: Banco BPI S.A. (Madeira)

-- Placed on Review Direction Uncertain (previously on Review
    for Downgrade):

-- Long-term Counterparty Risk Assessment, currently Ba2(cr)

-- Junior Subordinate Medium-Term Note Program, currently (P)B3

-- Subordinate Medium-Term Note Program, currently (P)B2

-- Senior Unsecured Medium-Term Note Program, currently (P)Ba3

-- Outlook Actions:

-- Outlook remains at Ratings Under Review

Issuer: Banco BPI S.A. (Santa Maria)

-- Placed on Review Direction Uncertain (previously on Review
    for Downgrade):

-- Long-term Counterparty Risk Assessment, currently Ba2(cr)

-- Junior Subordinate Medium-Term Note Program, currently (P)B3

-- Subordinate Medium-Term Note Program, currently (P)B2

-- Senior Unsecured Medium-Term Note Program, currently (P)Ba3

-- Outlook Actions:

-- Outlook remains at Ratings Under Review

Issuer: CaixaBank, S.A.

-- Affirmations:

-- Adjusted Baseline Credit Assessment, affirmed ba1

-- Baseline Credit Assessment, affirmed ba1

-- Short-term Counterparty Risk Assessment, affirmed P-2(cr)

-- Long-term Counterparty Risk Assessment, affirmed Baa1(cr)

-- Issuer Rating, affirmed Baa2, outlook changed to Negative
    from Stable

-- Short-term Deposit Ratings, affirmed P-2

-- Subordinate Medium-Term Note Program, affirmed (P)Ba2

-- Other Short Term, affirmed (P)P-2

-- Senior Unsecured Medium-Term Note Program, affirmed (P)Baa2

-- Subordinate Regular Bond/Debenture, affirmed Ba2

-- Senior Unsecured Regular Bond/Debenture, affirmed Baa2,
    outlook changed to Negative from Stable

-- Long-term Deposit Ratings, affirmed Baa2, outlook changed to
    Negative from Stable

-- Outlook Actions:

-- Outlook changed to Negative from Stable


GRUPO ISOLUX: Taps Houlihan Lokey to Review Debt Structure
----------------------------------------------------------
Luca Casiraghi at Bloomberg News reports that Grupo Isolux Corsan
SA hired Houlihan Lokey Inc. to review its debt structure.

According to Bloomberg, two people familiar with the situation
said the company will also continue working with Rothschild.

The people said Rothschild was previously appointed to advise on
potential mergers and asset sales, Bloomberg notes.

Isolux is seeking to reduce a EUR1.6 billion (US$1.8 billion)
debt pile and has said it wants to sell assets in Brazil and
solar-energy plants, Bloomberg relates.

Grupo Isolux Corsan SA is a Spanish construction company.


NH HOTEL: Fitch Revises Outlook to Positive & Affirms B- IDR
------------------------------------------------------------
Fitch Ratings has revised NH Hotel Group S.A's. Outlook to
Positive from Stable, while affirming its Long-term Issuer
Default Rating (LT IDR) at 'B-'.  Fitch has also affirmed NH's
EUR250 mil. 2019 senior secured notes at 'B+' with a Recovery
Rating 'RR2.'

Fitch is also withdrawing the 'B+(EXP)' instrument rating on the
planned issue of EUR200 mil. 2022 secured notes, which the group
has decided not to proceed with.  The change to Positive Outlook
reflects Fitch's view that due to its refurbishment and brand
repositioning program, which is strengthening and diversifying
its business model, NH should be able to maintain the improved
operating performance it achieved in 2015.

The ratings are constrained by past under-investment in the hotel
portfolio, which has been addressed with a significant capex
program to be substantially completed by end-2016.  While Fitch
expects some deleveraging over the next three years, this may be
limited by potential dividend payments from 2017 onwards.

The Outlook is likely to return to Stable if Fitch believes that
its sensitivities for an upgrade are not achievable in the next
two years.

                         KEY RATING DRIVERS

Operating Performance Improving

EBITDA increased in 2015, with revenue per available room
(RevPar) growing at 11% yoy.  This positive trend should be
maintained in 2016, as refurbishment leads to average room rate
rises, although lower than in 2015.  The trend also underlines
the group's move to upmarket hotels with the conversion of around
21 hotels to the upscale NH Collection brand, achieving higher
room rates (between 30% and 50% additional ARR versus an NH room)
through increased bookings from new business users.

Growing Upscale Presence

The expansion and development plan includes the development of
further NH Collection four star plus hotels, which should
increase the portfolio to a total of close to 70 hotels and
11,000 rooms by end- 2017.  Overall NH Collection hotels deliver
an ARR of between 30% and 50% more than a normal NH hotel.  This
upscale hotel format underpins our estimate of EBITDA growth from
2016 to 2018.

Attractive Hotel Portfolio

The majority of NH hotel properties are in or around major
European and Latin American cities.  As a result, the portfolio's
valuation (EUR1.6 bil. at end-2014) has proven resilient and
become a primary source of liquidity in recent years.  The
properties further serve as collateral for the group's secured
debt.  In additional NH has identified up to EUR140m of hotels
that could be disposed of in 2016.

Evolving Lease Liabilities

During 2015, the group terminated leases and renegotiated lease
contracts, resulting in an annual gross savings of around EUR7m
p.a. (before new leases signed).  This process should continue in
2016, ensuring leases remain stable as a percentage of revenues
at around 20%.  They are, however, still high compared with peers
(Accor: 15% in 2015).

High but Slowly Improving Leverage

Leverage is in the 'B' category and Fitch expects some moderate
deleveraging in 2016, which constrains the ratings.  Based on
Fitch's conservative EBITDA growth assumptions, we project that
FFO lease-adjusted net leverage should improve but remain above
7.0x at end-2016 (7.7x at end 2015).  This compares unfavorably
with peers, Accor and Whitbread, and reflects projected high
capex in 2016 that will absorb potential FCF generation in that
year. While we expect some deleveraging over the next three
years, this may be limited by potential dividend payments from
2017 onwards.

Nevertheless, the Positive Outlook is based on the scope for
better-than-expected performance, due to improved momentum in
NH's core markets of Italy and Spain.

Gradual Shift to Online

At end-2015 around 50% of bookings were through direct channel
(ie own website and mobile apps) against third-party website
bookings. NH is targeting for 55% of all bookings to be made
directly by 2018, which is still moderate by European standards,
although acceptable by southern Europe standards.

Strong Expected Recoveries

The 'RR2' on the senior secured notes reflects Fitch's
expectations that the valuation of NH -- and resulting recoveries
for its creditors -- will be maximized in a liquidation due to
the significant value of the group's owned real-estate portfolio,
which also benefits from unencumbered assets with an estimated
value of around EUR600 mil. at end-October 2015.  Fitch assumes a
fairly conservative 7x multiple in a distressed scenario.

Successful Asset Disposals

NH sold the Sotogrande estate for EUR178m in 2014 and achieved a
further EUR33 mil. of disposals in 2015, which has improved
financial flexibility, allowed some debt repayment and funded
capex.  NH plans to sells a further EUR140 mil. of hotel assets
in 2016, reflecting its continued push to dispose of under-
performing or non-core assets.

Asset-Light Slowly Increasing

The asset sales in 2014 and 2015 demonstrate NH's move to
increase the portion of the overall portfolio under a "managed"
format as opposed to the "owned" structure currently in place.
Since 2008, NH has increased the properties under management to
24% at end-2015.  This changing business model combines the
benefits of lower capex needs with reduced volatility of profits.
Nevertheless the group remains an asset heavy/leased business
model, rather than the US-asset light hotel business profile.

Acceptable but Thin Liquidity

NH's unrestricted cash was EUR42 mil. at end-2015, down from
EUR165m at end-2014, as a result of the higher capex and the
acquisition of the Colombian hotel group, Hoteles Royal, during
2015.  Capex to reposition the hotels, expand and develop new
projects and upgrade the IT network for the coming three years
will remain high in 2016 and is likely to drain operating cash,
leading to net cash outflows.  With the repositioning likely to
be completed by end-2016, Fitch estimates capex will return to
more normal levels of between 4% and 6% of revenues.

Debt maturity slightly improved in FY15, with the extension of
the maturity of the EUR171.5 mil. syndicated loan facility by a
year to October 2018.  2018 will be a key refinancing year with
EUR439 mil. to be repaid, including the EUR250 mil. convertible
bonds.

                          KEY ASSUMPTIONS

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

   -- Occupancy and ARR growth will be lower than management's
      expectations, particularly from 2017 onwards.
      Nevertheless, Fitch assumes RevPar to increase as the
      repositioning plan completes, a greater number of NH
      Collection upscale rooms become available, and improved
      room yield management takes effect.  But 2016 overall
      RevPar increase will be more moderate than in 2015.

   -- Operating lease costs of between around EUR300 mil. p.a.
      and EUR335 mil. p.a. from 2016 to 2018.

   -- Capex (maintenance and repositioning/development) between
      EUR160 mil. and EUR170 mil. reflecting that around 80% of
      repositioning spending will be completed by end-2016.

   -- Potential dividend payments from 2017 onwards.

   -- Deferred payment for Hoteles Royal of EUR17.7 mil. in 2017.

                       RATING SENSITIVITIES

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

   -- Sustained improved trading performance leading to group
      EBITDA margin (excluding one-off gains) being sustained at
      or above 10% (FY15: 9.1%)

   -- Leverage reducing sustainably to FFO lease-adjusted net
      leverage below 7.0x.

   -- EBITDAR/(gross interest +rent) sustainably above 1.5x or
      FFO fixed charge cover above 1.3x (FY15: 1.2x)

   -- Demonstrated sustained positive free cash flow (FCF).

Negative: The Outlook is likely to return to Stable if Fitch
projects that the above sensitivities for an upgrade are not
achievable over a two-year horizon.

Future developments that may, individually or collectively, lead
to a downgrade include:

   -- Weakening occupancy or pricing leading to group EBITDA
      margin (excluding one-off gains) falling below 6%
   -- Weaker operational cash flows leading to higher continued
      FCF outflows, resulting in strained liquidity
   -- FFO lease adjusted net leverage above 9.0x
   -- EBITDAR/(gross interest + rent) below 1.1x or FFO fixed
      charge cover below 1.1x on a sustained basis.

              SUMMARY OF FINANCIAL STATEMENTS ADJUSTMENTS

   -- Leases: Fitch has adjusted the debt by adding 8x of yearly
      operating lease expense to long-term assets of EUR283 mil.
      in 2015

   -- Cash: Fitch has adjusted available cash at end-December
      2015 by deducting EUR35 mil. for restrictions, working
      capital and operational requirements.



=====================
S W I T Z E R L A N D
=====================


GATEGROUP HOLDING: S&P Puts BB- CCR on CreditWatch Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services said that it placed its 'BB-'
long-term corporate credit rating on Switzerland-based airline
solutions provider gategroup Holding AG on CreditWatch with
negative implications.

The CreditWatch placement follows the announcement by privately
owned Chinese conglomerate HNA Group Co. Ltd. that it has
launched a tender offer to acquire publicly listed gategroup
Holding AG for about Swiss franc (CHF) 1.4 billion (about EUR1.3
billion) in cash.  S&P understands that the acquisition would
leave gategroup with its existing debt obligations, which would
value the company at about CHF2 billion (EUR1.8 billion).  HNA
operates in the aviation, infrastructure, real estate, financial
services, tourism, and logistics sectors.

S&P understands that, if the offer is successful, gategroup will
be delisted as a public company and operate as an autonomous
portfolio company of HNA.  Furthermore, gategroup will remain
headquartered in Switzerland under the leadership of the current
management team.  S&P also understands that gategroup's Board of
Directors supports the offer.  The company has stated that the
offer is subject to a minimum shareholder acceptance condition of
67% -- with the offer period starting on or around May 11,
2016 -- as well as the approval of regulatory and merger control
authorities.

The CreditWatch negative placement reflects S&P's uncertainty
over gategroup's capital structure after the acquisition.  It
also reflects S&P's view that private ownership may increase
gategroup's tolerance for higher leverage and lead to more
aggressive financial policies such as higher shareholder returns.
Before the transaction closes, S&P will seek to gain further
information regarding HNA's strategy and likely financial policy
for gategroup.

The CreditWatch placement reflects the possibility that S&P could
lower the rating on gategroup if the transaction proceeds as S&P
expects.

S&P aims to resolve the CreditWatch placement once the
acquisition is finalized, which S&P understands is currently
expected to be toward the end of July 2016.  Before transaction
close, S&P will attempt to determine HNA's likely strategy and
financial policy for gategroup.

In the event that the transaction does not complete as expected,
S&P would likely affirm the ratings with a positive outlook, all
other things being equal.



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


ELEMENT MATERIALS: S&P Withdraws B Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services said it withdrew its 'B' long-
term corporate credit rating on U.K.-based Element Materials
Technology Group Holding CC2 Ltd.  At the same time, S&P withdrew
its 'B' issue rating and '3' recovery rating on the senior
secured credit facilities issued by Element Materials Technology
UK Holdings Ltd., following their repayment.

During the first quarter of 2016, Element was acquired by Element
Materials Technology Ltd. (B/Stable/--), a holding company
created by private equity group Bridgepoint for the sole purpose
of carrying out the acquisition.  S&P is withdrawing its
corporate credit rating on Element and S&P's issue and recovery
ratings on its senior secured credit facilities, following their
repayment.


TOWD POINT: Moody's Assigns B1 Definitive Ratings to Cl. G Debt
---------------------------------------------------------------
Moody's Investors Service has assigned definitive credit rating
to the following Notes issued by Towd Point Mortgage Funding
2016-Granite 1 plc:

-- GBP4,626,000,000 Class A Floating Rate Note due July 2046,
    Definitive Rating Assigned Aaa (sf)

-- GBP441,200,000 Class B Floating Rate Note due July 2046,
    Definitive Rating Assigned Aa1 (sf)

-- GBP395,600,000 Class C Floating Rate Note due July 2046,
    Definitive Rating Assigned Aa2 (sf)

-- GBP182,600,000 Class D Floating Rate Note due July 2046,
    Definitive Rating Assigned A1 (sf)

-- GBP60,800,000 Class E Floating Rate Note due July 2046,
    Definitive Rating Assigned Baa1 (sf)

-- GBP121,700,000 Class F Floating Rate Note due July 2046,
    Definitive Rating Assigned Ba1 (sf)

-- GBP54,700,000 Class G Floating Rate Note due July 2046,
    Definitive Rating Assigned B1 (sf)

The GBP204,274,000 Class Z Subordinated Note due July 2046, the
GBP182,600,000 Class X Note due July 2046 and the Senior Deferred
Certificate, Deferred Certificate 1, 2 and 3 have not been rated
by Moody's.

The loans are backed by a pool of prime UK residential mortgages,
which were previously securitized assets within the Granite
Master Trust ("Granite") transaction currently held within the
Neptune Rated Warehouse and Neptune Unrated Warehouse. NRAM Plc
sold the beneficial interest in the assets to Cerberus European
Residential Holdings B.V. ("Cerberus") which will further sell
the beneficial interest in the assets to Towd Point Mortgage
Funding 2016-Granite 1 plc (the "Transaction"). Moody's notes
that following the sale of NRAM Plc to Cerberus, NRAM Plc is
likely to lose the UK government guarantee which currently covers
all unsubordinated and unsecured wholesale debt and deposits of
NRAM Plc. Consequently, Moody's has factored into its analysis
the effects of the loss of the UK government guarantee by NRAM
Plc.

RATINGS RATIONALE

The rating of the Notes is based on an analysis of the
characteristics of the underlying mortgage pool, sector wide and
originator specific performance data, protection provided by
credit enhancement, the roles of external counterparties
including the backup servicer and the structural features of the
transaction.

-- Expected Loss and MILAN CE Analysis

Moody's determined the MILAN CE of 16.0% and the portfolio
expected loss of 2.1% as input parameters for Moody's cash flow
model, which is based on a probabilistic lognormal distribution.

Portfolio expected loss of 2.1%: This is higher than the UK Prime
sector average of 1% and is based on Moody's assessment of the
lifetime loss expectation for the pool taking into account (i)
the collateral performance of NRAM Plc originated loans to date,
as provided by NRAM Plc and observed in Granite. 7.6% of the pool
(as of 31st March 2016) are 1 month or more in arrears; (ii) the
current macroeconomic environment in the UK and the potential
impact of future interest rate rises on the performance of the
mortgage loans and (iii) benchmarking with comparable
transactions in the UK market.

MILAN Credit Enhancement of 16.0%: This is higher than the UK
Prime sector average of 9% and follows Moody's assessment of the
loan-by-loan information taking into account the following key
drivers (i) the loan characteristics including 42.3% of the pool
being Together loans for which an unsecured loan balance is
outstanding. These are loans where the borrower obtained a
secured and an unsecured loan; (ii) the weighted average current
loan-to-value of 73.1%, which is higher than the average seen in
the sector; and (iii) the historical performance of the loans
with 68.6% of the loans in the pool having been current over the
last five years.

Moody's notes that the expected loss is higher for this
transaction compared to Neptune Rated Warehouse and is in line
with the assumption previously in place for Granite. Prior to the
Granite asset sale to the Neptune Rated Warehouse the expected
loss in Granite was 2.1%. The 10bps increase in the expected loss
assumptions to 2.1% from 2.0% between the Neptune Rated Warehouse
and Towd Point Mortgage Funding 2016-Granite1 Plc is largely
driven by the inclusion of loans more than 12 months in arrears
which were previously excluded from the Neptune Rated Warehouse.

The MILAN Credit Enhancement is lower for this transaction
compared to Granite and is in line with the Neptune Rated
Warehouse. Prior to the Granite asset sale to the Neptune Rated
Warehouse the MILAN Credit Enhancement in Granite was 19%. The
reduction in the MILAN Credit Enhancement from 19.0% to 16.0% is
largely driven by the additional information provided on the
number of months a loan has been current which was previously not
provided.

-- Operational Risk Analysis

NRAM Plc is the contractual servicer sub delegating all its
servicing to Bradford & Bingley plc ("B&B"). A back up servicer
(Topaz Finance Limited (Not rated) and Western Mortgage Services
Limited (Not rated)), and Back-Up Servicer Facilitator
(Wilmington Trust SP Services (London) Ltd) have been appointed
at closing. The backup servicer is required to step in within 90
days and perform the duties of the servicer or delegated servicer
if, amongst other things, the servicer and/ or delegated servicer
is insolvent or defaults on its obligation under the servicing
agreement or sub delegated servicing agreement. Moody's notes
that the B&B servicing platform is currently in the process of
being sold with Computershare being announced as the preferred
bidder. Should the sale of the B&B servicing platform to
Computershare be successful, B&B will continue as interim
servicer until the new long term servicing contract is in place
between NRAM Plc and the replacement service provider.

Citibank, N.A. (London Branch) (A1/(P)P-1/A1(cr)) is appointed as
cash manager. There will be no back up cash manager in place at
closing. To help ensure continuity of payments the deal contains
estimation language whereby the cash flows will be estimated from
the three most recent servicer reports should the servicer report
not be available.

The collection account is held at National Westminster Bank PLC
("NATWEST") (A3/P-2/A3(cr)). There is a daily sweep of the funds
held in the collection account into the transaction account. In
the event NATWEST rating is below Baa3 the collection account
will be transferred to an entity rated at least Baa3. The
transaction account is held at Citibank, N.A. (London Branch)
(A1/(P)P-1/A1(cr)) with a transfer requirement if the rating of
the account bank falls below A3. Moody's has taken into account
the commingling risk within its cash flow modelling.

-- Transaction structure

There is no Liquidity Reserve Fund in place at closing. Following
the step up date (3 years from closing) the Liquidity Reserve
Fund will be equal to 1.7% of the Class A outstanding balance and
can be used to pay senior fees and interest on class A. Prior to
the step up date liquidity is provided via a 365 day revolving
Liquidity Facility equal to 1.7% of the Class A outstanding
balance provided by Wells Fargo Bank, National Association,
London Branch (Wells Fargo Bank, N.A (Aa1/P-1/Aa1(cr)). At
closing, the Liquidity Facility provides approx. 3.0 months of
liquidity to the Class A assuming Libor of 5.0%. Principal can be
used as an additional source of liquidity to meet shortfall on
senior fees and interest on the most senior outstanding class. In
addition, Moody's notes that unpaid interest on the Class B, C,
D, E, F and G is deferrable. Non-payment of interest on the Class
A notes constitutes an event of default.

Interest on the notes (excluding Class A) is subject to a Net
Weighted Average Coupon (Net WAC) Cap. Net WAC additional amounts
are paid junior in the revenue waterfall being the difference
between the class B, C, D, E, F and G coupon and the Net WAC Cap.
Net WAC additional amounts occur if interest payments to the
respective notes are greater than the Net WAC Cap. Moody's notes
that the Net WAC additional amounts are not part of the interest
payment promise to the referenced Classes and as such Moody's
ratings assigned to the Class B, C, D, E, F and G do not address
the timely and/ or ultimate payment of such payments.

-- Interest Rate Risk Analysis

As there are no swaps in the transaction, Moody's has modelled
the spread taking into account the minimum margin covenant of
Libor plus 2.4%. Due to uncertainty on enforceability of this
covenant, Moody's has taken the view not to give full credit to
this covenant. Instead, Moody's has stressed the interest rate of
the pool by assuming that loans revert to SVR yield equal to
Libor + 2.0%.

-- Parameter Sensitivities

Moody's Parameter Sensitivities provide a quantitative/model-
indicated calculation of the number of rating notches that a
Moody's structured finance security may vary if certain input
parameters used in the initial rating process differed. The
analysis assumes that the deal has not aged and is not intended
to measure how the rating of the security might migrate over
time, but rather how the initial rating of the security might
have differed if key rating input parameters were varied.
Parameter Sensitivities for the typical EMEA RMBS transaction are
calculated by stressing key variable inputs in Moody's primary
rating model. If the portfolio expected loss was increased from
2.1% of current balance to 6.3% of current balance, and the MILAN
Credit Enhancement was increased from 16.0% to 22.4%, the model
output indicates that the Class A would still achieve Aaa
assuming that all other factors remained equal.

Factors that would lead to an upgrade or downgrade of the
ratings:

Factors that would lead to a downgrade of the ratings include
economic conditions being worse than forecast resulting in worse-
than-expected performance of the underlying collateral,
deterioration in the credit quality of the counterparties and
unforeseen legal or regulatory changes.

Factors that would lead to an upgrade of the ratings include
economic conditions being better than forecast resulting in
better-than-expected performance of the underlying collateral.

The rating addresses the expected loss posed to investors by the
legal final maturity of the loan facilities. Moody's ratings only
address the credit risk associated with the transaction. Other
non-credit risks have not been addressed, but may have a
significant effect on yield to investors.

The analysis undertaken by Moody's at the initial assignment of
ratings for RMBS securities may focus on aspects that become less
relevant or typically remain unchanged during the surveillance
stage. Please see Moody's Approach to Rating RMBS Using the MILAN
Framework for further information on Moody's analysis at the
initial rating assignment and the on-going surveillance in RMBS.



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


* Global Corporate Borrowers Default on US$50BB Debt in 2016
------------------------------------------------------------
Eric Platt at The Financial Times reports that corporate
borrowers across the world have defaulted on US$50 billion of
debt so far this year as the number of delinquent companies
accelerates at its fastest pace since the US emerged from the
financial crisis in 2009.

The number of defaults rose by five in the past week, including
the first European company of the year, the FT says, citing
Standard & Poor's.  Forty-six companies have defaulted since the
year began, the FT relays.

The sharp decline in commodity prices, spurred by slowing global
growth and lacklustre demand for base metals and crude, has
weighed on oil and gas producers and miners, the FT discloses.
Nearly half of the defaults have occurred in these two
industries, with companies such as Peabody Energy, Energy XXI and
Midstates Petroleum all missing interest payments, the FT states.

The latest defaults include Norwegian paper producer Norske
Skogindustrier and US miner Cliffs Natural Resources, the FT
notes.


* Moody's Expects EMEA Corporate Defaults to Increase
-----------------------------------------------------
A 42% jump in EMEA non-financial companies at the bottom end of
the rating scale (Caa and below) signals scope for more corporate
defaulters, with defaults also coming from sectors outside
commodities, says Moody's Investors Service.

Moody's report is titled "Non-Financial Corporates -- EMEA: More
Companies at Risk of Default than in 2015; Stress Broader than
Commodities".

More EMEA companies are now at "higher risk of default", with
numbers growing significantly to 47 from 33 over the last year.
At the end of March 2015, companies rated at Caa and below
represented 4.9% of the portfolio, but this figure has now risen
to 6.7% as of 31 March 2016. Despite this growth, Moody's expects
the global default rate for the next 12 months to remain in line
with the long-term average because it is rising from a
historically low level.

"We expect more companies to default, but the overall default
rate is rising from very low levels so it should only reach the
long-term average this year. Default risk has increased for
specific companies across a range of sectors, not just
commodities, as investors are now more cautious and
discriminating, and market access is more uncertain," says
William Coley, a Moody's Senior Vice President and author of the
report.

The oil & gas, metals & mining, and related sectors have
dominated recent rating actions, particularly over the last
quarter. However, credit stress is becoming more widespread with
other sectors representing about two thirds of the current Caa
population. The report lists companies rated Caa or below at the
end of March. Since that date, however, Moody's has published on
two that have already defaulted: Edcon Holdings Limited in the
retail sector on April 18, and Norske Skogindustrier ASA, a
newsprint producer on April 19.

Moody's outlook for non-financial corporates in EMEA remains
stable, albeit with more areas of weakness than in December 2015.
"We are not seeing a wholesale downward migration in credit
quality, as the aggregate share of companies rated B3 or below
has barely changed since 2015. What we are actually seeing is
greater differentiation between likely defaulters and non-
defaulters," adds Mr. Coley.

The stable outlook is further supported by reduced market
volatility and improved spreads, which have seen Moody's shift to
a more optimistic forecast for high-yield default rates. As per
its monthly default report for March, the rating agency now
expects the EMEA rate for the next year to be 2.8%, versus
February estimates of a rise to 3.8%.


* BOOK REVIEW: The Money Wars
-----------------------------
Author: Roy C. Smith
Publisher: Beard Books
Softcover: 370 pages
List Price: $34.95
Review by David Henderson
Get your own personal today at
http://www.amazon.com/exec/obidos/ASIN/1893122697/internetbankrup
t

Business is war by civilized means. It won't get you a tailhook
landing on an n aircraft carrier docked in San Diego, but the
spoils of war can be glorious to behold.

Most executives do not approach business this way. They are
content to nudge along their behemoths, cash their options, and
pillage their workers. This author calls those managers "inertia
ridden." He quotes Carl Icahn describing their companies as run
by "gross and widespread incompetent management."

In cycles though, the U.S. economy generates a few business
warriors with the drive, or hubris, to treat the market as a
battlefield. The 1980s saw the last great spectacle of business
titans clashing. (The '90s, by contrast, was an era of the
investment banks waging war on the gullible.) The Money Wars is
the story of the last great buyout boom. Between 1982 and 1988,
more than ten thousand transactions were completed within the
U.S. alone, aggregating more than $1 trillion of capitalization.
Roy Smith has written a breezy read, traversing the reader
through an important piece of U.S. history, not just business
history. Two thirds of the way through the book, after covering
early twentieth century business history, the growth of financial
engineering after WWII, the conglomerate era, the RJR-Nabisco
story, and the financial machinations of KKR, we finally meet the
star of the show, Michael Milken. The picture painted by the
author leads the reader to observe that, every now and then, an
individual comes along at the right time and place in history who
knows exactly where he or she is in that history, and leaves a
world-historical footprint as a result. Whatever one may think of
Milken's ethics or his priorities, the reader will conclude that
he is the greatest financial genius this country has produced
since J.P. Morgan.

No high-flying financial era has ever happened in this country
without the frothy market attracting common criminals, or in some
cases making criminals out of weak, but previously honest men
(and it always seems to be men). Something there is about
testosterone and money. With so many deals being done, insider
trading was inevitable. Was Michael Milken guilty of insider
trading? Probably, but in all likelihood, everybody who attended
his lavish parties, called "Predators' Balls," shared the same
information.

Why did the Justice Department go after Milken and his firm,
Drexel Burnham Lambert with such raw enthusiasm? That history has
not yet been written, but Drexel had created a lot of envy and
enemies on the Street.

When a better history of the period is written, it will be a
study in the confluence of forces that made Michael Milken's
genius possible: the sclerotic management of irrational
conglomerates, a ready market for the junk bonds Milken was
selling, and a few malcontent capitalist like Carl Icahn and Ted
Turner, who were ready and able to wage their own financial
warfare.

This book is a must read for any student of business who did not
live through any of these fascination financial eras.
Roy C. Smith is a professor of entrepreneurship, finance and
international business at NYU, and teaches on the faculty there
of the Stern School of Business. Prior to 1987, he was a partner
at Goldman Sachs. He received a B.S. from the Naval Academy in
1960 and an M.B.A. from Harvard in 1966.


                            *********

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, 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.


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