TCREUR_Public/160629.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

           Wednesday, June 29, 2016, Vol. 17, No. 127



CARINTHIA STATE: Moody's Affirms B3 Issuer & Sr. Debt Ratings
UNICREDIT BANK: Moody's Puts Ba2 Rating on Review for Upgrade


UNITED BULGARIAN: S&P Raises Counterparty Credit Rating to 'B'


GERMAN PELLETS: June 30 Deadline to Register for Creditors Mtg Set


IRISH BANK: Former Chief Executive Appeals Bankruptcy Ruling


ITALY: Prepares EUR40BB Bank Rescue Following Brexit After-Shocks
PRIVILEGE YARD: July 8 Bid Submission Deadline Set for Assets


NEPTUNO CLO I: S&P Affirms CCC- Ratings on 2 Note Classes
OI BRASIL: Syzygy Capital Files Bankruptcy Petition in Amsterdam
TITAN EUROPE 2007-2: Fitch Cuts Rating on Class B Notes to 'Csf'


ALFA-BANK: Fitch Affirms 'BB+' LT Issuer Default Ratings
BRUNSWICK RAIL: Draws Up New Debt Restructuring Offer
MOSENERGO AO: S&P Raises CCR to 'BB+', Outlook Negative
SAMARA OBLAST: S&P Assigns 'BB' Rating to RUB10BB Sr. Unsec. Bond
SCF CAPITAL: Fitch Assigns 'BB' Rating to 5.375% 2023 Notes


ABANCA CORPORACION: Moody's Raises Long-Term Deposit Rating to B2
CAIXABANK CONSUMO 2: Moody's Assigns B3 Rating to Series B Notes

U N I T E D   K I N G D O M

BHS GROUP: FRC Opens Probe Into PwC's Audit Prior to Collapse
HEALTHCARE SUPPORT: S&P Keeps 'B+' Rating on CreditWatch Positive
SANDWELL COMMERCIAL 2: Fitch Hikes Class B Debt Rating to 'BBsf'



CARINTHIA STATE: Moody's Affirms B3 Issuer & Sr. Debt Ratings
Moody's Investors Service has affirmed the State of Carinthia's
long-term issuer and senior unsecured debt ratings at B3.  The
outlook was changed to developing from negative.

The rating action follows the downgrade of Austria's long-term
issuer and senior unsecured debt ratings to Aa1 from Aaa,
announced on June 24.

The affirmation balances the state's ongoing and significant
exposure to HETA Asset Resolution AG (former HYPO ALPE-ADRIA-BANK
INTERNATIONAL AG) via outstanding guarantees against the recently
announced government expectation that a resolution can be found
without triggering the guarantees.  In Moody's view, the very low
rating levels of Carinthia are not materially affected by the
downgrade of the sovereign.

The change in outlook to developing reflects Moody's view that a
resolution could be found without triggering the guarantee.



Moody's affirmed the State of Carinthia's ratings at the current
level of B3, reflecting the state's susceptibility to event risk
and the still unresolved situation around extremely high
outstanding guarantees for HETA, and the risk that Carinthia's
guarantees on HETA's debt instruments are called.

However, following a recent announcement by the Austrian Minister
of Finance, Moody's expects that a resolution, to avoid a
triggering of the guarantee, could be found.  A resolution is
likely to include a bond exchange, whereby the Austrian Government
provides liquidity and guarantees to Carinthia's special purpose
vehicle "Karntner Ausgleichszahlungs-Fonds"
(KA-F) to present an offer for a bond exchange to HETA
bondholders.  The Austrian government would provide pre-funding to
KA-F, but Carinthia would bear a share of EUR1.2 billion of the

Carinthia's guarantees on HETA debt instruments total
EUR11 billion, or around five times Carinthia's annual operating

Carinthia's B3 ratings capture the risk that the HETA guarantee is
called, requiring the state to make HETA bondholders whole.  This
scenario remains likely at this point.  The state's baseline
credit assessment of caa3 reflects Moody's view that in this
scenario, Carinthia would not be able to discriminate between its
senior unsecured creditors, meaning it would likely default on all
its obligations, not just the guarantees.

Carinthia's B3 ratings benefit from a three-notch rating uplift
from its BCA, reflecting Moody's view of a strong probability of
support from the federal government in the event of acute
liquidity stress.

Most recently, in April 2016, the Financial Markets Authority
(FMA) in its role as the resolution authority under Austria's Bank
Resolution Law (BaSAG - Bundesgesetz Ă…ber die Sanierung und
Abwicklung von Banken) set out the next stage in HETA's wind-down,
including a haircut, but at the same time an extension of the
moratorium of all eligible liabilities to Dec. 31, 2023.  Moody's
views these measures as set to prevent guarantees from being


The outlook change to developing on the State of Carinthia's
ratings reflects Moody's view that following the announcement from
the Ministry of Finance, and the meanwhile announced preparatory
steps to reach a solution with investors, an outcome that avoids a
triggering of guarantees is more probable than expected before.
At the same time, until successful implementation, the risk of
guarantees being triggered remains unchanged.

Moody's view is based on the fact that (1) the Austrian
Government, represented by the Minister of Finance, is willing to
dialogue with creditors and has concluded a negotiation with a
group of creditors to present a Memorandum of Understanding (MoU);
and (2) the government is considering an improved offer to

There are some administrative steps to complete before the offer
can officially be submitted.  The plan is to make the offer in
September and complete the process in October.  A two-third
majority of creditors' acceptance would be needed.


Upward pressure on the rating could develop only after a
significant reduction of contingent liabilities or evidence of
reduced risk from guarantees being triggered.

Downward ratings pressure on the ratings of Carinthia could arise
from unexpected negative knock-on effects during the resolution of
HETA, or other actions taken by public authorities, and related
legal consequences for Carinthia.

In particular, any developments that lead to an immediate
triggering of the guarantee or any other development, which would
create an unexpected financial burden for Carinthia or stress its
liquidity would create downward pressure.  An increase of legal
risk uncertainty around the wind down of HETA could also create
downward pressure.

Any downward adjustment of Moody's assumption of extraordinary
support would create downward ratings pressure.  The rating could
also come under pressure if the creditworthiness of the sovereign
were to weaken further.

The publication of this rating action deviates from the previously
scheduled release date in the sovereign release calendar.  The
reason for the deviation is the rating action on the sovereign

The specific economic indicators, as required by EU regulation,
are not available for the Austrian sub-sovereign entities.  The
following national economic indicators are relevant to the
sovereign rating, which was used as an input to this credit rating

Sovereign Issuer: Austria, Government of

  GDP per capita (PPP basis, US$): 47,250 (2015 Actual) (also
   known as Per Capita Income)
  Real GDP growth (% change): 0.9% (2015 Actual) (also known as
   GDP Growth)
  Inflation Rate (CPI, % change Dec/Dec): 1.2% (2015 Actual)
  Gen. Gov. Financial Balance/GDP: -1.2% (2015 Actual) (also
   known as Fiscal Balance)
  Current Account Balance/GDP: 2.7% (2015 Actual) (also known as
   External Balance)
  External debt/GDP: [not available]
  Level of economic development: Very High level of economic
  Default history: No default events (on bonds or loans) have
   been recorded since 1983.


On June 23, 2016, a rating committee was called to discuss the
rating of the Austrian sub-sovereign entities, including
Carinthia, State of.  The main points raised during the discussion
were: The systemic risk in which the issuer operates has
materially increased.  The issuer has become less susceptible to
event risks.

The principal methodology used in these ratings was Regional and
Local Governments published in January 2013.

The weighting of all rating factors is described in the
methodology used in this rating action, if applicable.

UNICREDIT BANK: Moody's Puts Ba2 Rating on Review for Upgrade
Moody's Investors Service has placed on review for upgrade the
ratings of UniCredit Bank Austria AG (UBA), specifically the
bank's Baa2 long-term debt and deposit ratings, the Ba2
subordinated debt ratings, various hybrid ratings assigned to
UBA's non-cumulative preferred securities issued by finance
vehicles, as well as its ba2 Baseline Credit Assessment (BCA) and
ba1 adjusted BCA.  UBA's Baa1(cr)/Prime-2(cr) Counterparty Risk
Assessments were also placed on review for upgrade.  The bank's
Prime-2 short-term deposit and (P)Prime-2 program ratings were

The review for upgrade reflects the expected benefits of the
fundamental restructuring of UBA, which entails the carve-out and
transfer of its large operations in Central and Eastern European
Countries (CEE) to its Italian parent bank, UniCredit SpA
(deposits Baa1 stable, debt Baa1 stable, BCA ba1) in early October
2016.  The review will consider the change of the Austrian Macro
Profile to Strong + from Very Strong --, which is now less
supportive for the ratings of banks operating in Austria.
However, while the weaker Austrian Macro Profile will offset some
of the upward pressure on UBA's ratings, Moody's expects the
benefits of the planned restructuring to outweigh this effect.
The rating agency may upgrade the BCA by more than one notch
whereby any upgrade of the BCA above the ba1 level could trigger
upgrades of the bank's debt and deposit ratings.

For a detailed analysis of Austria's Macro Profile, please click
on the following link:


Prompted by the review on UBA's ratings, Moody's has also
initiated a review for upgrade of the Baa3 and Prime-3 long- and
short-term deposit ratings of card complete Service Bank AG (card
complete), an Austrian credit card issuer which is majority-owned
by UBA.  Card complete's ba2 BCA and adjusted BCA were also placed
on review for upgrade.

Concurrently, Moody's has placed on review for upgrade UBA's A3
ratings for guaranteed senior obligations and its Baa3 guaranteed
subordinated debt obligations, which benefit from the
creditworthiness of the guarantor, the City of Vienna.  Moody's
positions the ratings for "backed" senior unsecured debt at a
level two notches above that of UBA's non-guaranteed debt in order
to reflect uncertainty about the value of such guarantees to



The review for upgrade of UBA's ba2 BCA reflects the prospect of a
material improvement to the bank's risk profile, in particular
better asset quality and lower risks to capital after the transfer
of its CEE operations to its Italian parent bank.  In recent
years, the CEE business has, on several occasions, required
additional capital, which UBA struggled to provide by purely
drawing on its own resources.  The required capital was therefore
partly provided by the Italian parent, UniCredit SpA.  Apart from
the substantial credit risk associated with UBA's CEE business,
capital pressures were sometimes triggered by market risk and/or
political intervention in some of the CEE countries in which UBA
operates.  At the end of 2015, UBA's CEE segment represented 50%
of the bank's loans, and 73% of its risk-weighted assets.

In the context of the CEE related risks, Moody's said that UBA's
future business scope will be in a much more stable operating
environment.  The UBA's operating environment is, and therefore
its ratings are, heavily influenced by the Macro Profiles of
several Eastern European markets, in particular Russia (Ba1
negative), Turkey (Baa3 negative), the Czech Republic (A1 stable)
and Croatia (Ba2 negative).  Due to the transfer of the CEE
operations in October 2016, the bank's Strong-Weighted Macro
Profile score will likely improve to Strong or even Strong+, as
the bulk of its non-CEE assets are domiciled in Austria.  That
said, Moody's expects that intragroup funding to CEE entities will
only decline over time as current funding arrangements fall due.



Moody's review for upgrade will focus on: (1) the regional
breakdown of UBA's future lending exposures, and the resulting
Macro Profile score for its business; (2) changes in UBA's key
metrics for solvency, as well as funding and liquidity; and (3)
possible changes of UBA's future liability profile which could
prompt a reassessment of the result of Moody's Advanced Loss Given
Failure (LGF) analysis.  Moody's Advanced LGF analysis takes into
account the severity of loss faced by the different liability
classes in resolution, and provides two notches of rating uplift
to UBA's senior unsecured debt and deposit ratings.

Moody's has said that for a comprehensive picture of UBA's future
credit profile, considerable additional information will be
necessary.  As no target capital ratios have been reported for UBA
so far, Moody's will focus on the bank's plans for its future
regulatory common equity and leverage ratios.  However, Moody's
expects some improvement in UBA's transitional Common Equity Tier
1 ratio of 11.2% at March 31, 2016.

As a result of the review, Moody's assessment of the capacity and
willingness of UniCredit SpA to support its Austrian subsidiary
will likely be less significant for UBA's debt and deposits
ratings.  A one-notch upgrade of the ba2 BCA to ba1 would result
in the removal of the current single notch of affiliate support
uplift factored into UBA's debt and deposit ratings, thereby
aligning UBA's BCA with the ba1 BCA of its parent.  In this
context, Moody's notes that the rating review will additionally
focus on the extent to which UBA may restrict its intragroup
lending exposures, in particular its lending to UniCredit SpA.
This is because the latter will be an important factor in the
rating agency's assessment of the extent to which UBA's future BCA
can exceed the ba1 BCA of its parent bank.


The review for upgrade for the long- and short-term deposit
ratings of card complete was prompted by the review for upgrade of
UBA's Baa2 long-term debt and deposit ratings, which serve as an
anchor point for card complete's deposit ratings.

An upgrade of UBA's ba2 BCA would prompt an upgrade of card
complete's ratings because: (1) card complete displays a sound
financial profile which, without any restrictions, would allow for
a higher BCA; and (2) a higher BCA of UBA could imply that the
ratings of the credit card complete will be less restricted or no
longer restricted by the ratings of UBA.



As indicated by the status of the current review, Moody's does not
expect any downward pressure on UBA's long-term ratings.

Upward rating pressure on UBA's long-term ratings will be subject
to a successful execution of the planned carve-out and transfer of
its CEE operations to UniCredit SpA.  A successful execution will
likely prompt an upgrade of UBA's ba2 BCA.  In addition UBA's
management of intra-group exposures within prudent limits relative
to its capital, and/or an improvement in UniCredit SpA's credit
profile could exert upward pressure on UBA's BCA above the ba1
level, and therefore on its debt and deposit ratings.

In addition, materially higher subordinated capital instruments
relative to the bank's total assets could result in one additional
notch of rating uplift from Moody's Advanced LGF analysis.
Conversely, a change in UBA's liability structure that results in
a lower volume of subordinated and/or senior debt instruments and
junior deposits could reduce the rating uplift from Moody's
Advanced LGF analysis, and therefore offset some of the positive
rating pressure expected from the planned restructuring.


Upward pressure on the bank's deposit ratings could be triggered
by an upgrade of UBA's ba2 BCA because such an upgrade would lower
or remove the key restricting factor for card complete's BCA and
deposit ratings.  A higher BCA would prompt an upgrade of its
deposit ratings.

In addition, the same factors that drive the result of the
Advanced LGF analysis for deposits at UBA also drive card
complete's deposit ratings, because Moody's believes that both
banks would share a common perimeter and treatment in resolution.
A change in Moody's expectation of the loss-given-failure for
deposits at UBA would therefore equally affect card complete's
deposit ratings.

Downward pressure could be exerted on card complete's deposit
ratings as a result of: (1) a downgrade of its BCA which, however,
is not currently under pressure; or a weakening of UBA's credit
profile which is also not expected.


On Review for Upgrade:

ISSUER: UniCredit Bank Austria AG:

  Adjusted Baseline Credit Assessment, currently ba1
  Baseline Credit Assessment, currently ba2
  Long Term Counterparty Risk Assessment, currently Baa1(cr)
  Short Term Counterparty Risk Assessment, currently P-2(cr)
  Long Term Bank Deposit Ratings, currently Baa2, outlook changed
   to Rating Under Review from Stable
  Senior Unsecured Rating, currently Baa2, outlook changed to
   Rating Under Review from Stable
  Senior Unsecured MTN Rating, currently (P)Baa2
  Subordinate Rating, currently Ba2
  Subordinate MTN Rating, currently (P)Ba2
  Backed Senior Unsecured Ratings, currently A3, outlook changed
   to Rating Under Review from Stable
  Backed Senior Unsecured MTN Rating, currently (P)A3
  Backed Subordinate Rating, currently Baa3
  Backed Subordinate MTN Rating, currently (P)Baa3

ISSUER: Creditanstalt AG:

  Backed Subordinate Rating, currently Baa3

ISSUER: BA-CA Finance (Cayman Island) Ltd:

  Backed Pref. Stock Non-cumulative Rating, currently B1(hyb)

ISSUER: BA-CA Finance (Cayman Island) 2 Ltd:

  Backed Pref. Stock Non-cumulative Rating, currently B1(hyb)

ISSUER: card complete Service Bank AG:

  Adjusted Baseline Credit Assessment, currently ba2
  Baseline Credit Assessment, currently ba2
  Long Term Counterparty Risk Assessment, currently Baa2(cr)
  Short Term Counterparty Risk Assessment, currently P-2(cr)
  Long Term Bank Deposit Ratings, currently Baa3, outlook changed
   to Rating Under Review from Stable
  Short Term Bank Deposit Ratings, currently P-3


ISSUER: UniCredit Bank Austria AG:

  Short Term Bank Deposit Ratings, currently P-2
  Short Term Deposit Note / CP Program, currently P-2
  Other Short Term Ratings, currently (P)P-2


UNITED BULGARIAN: S&P Raises Counterparty Credit Rating to 'B'
S&P Global Ratings raised its long-term counterparty credit rating
on United Bulgarian Bank (UBB) to 'B' from 'B-' and affirmed its
'C' short-term rating.  The outlook is stable.

The rating action reflects S&P's view of UBB's strengthened
capital-absorption capacity and S&P's expectation that the bank
will maintain strong levels of capitalization, supported by
earnings contribution to its capital base in the low-growth
environment.  S&P forecasts that its risk-adjusted capital (RAC)
ratio for UBB will remain comfortably above 10% in the next 18
months, with a RAC ratio of 13.2% at year-end 2016.  The bank
continues to comfortably meet regulatory ratios, as reflected by
its 26.9% Tier 1 and 28.8% total capitalization ratios as of
March 31, 2016, well exceeding the regulatory minimum of 11.5% and
13.5%, respectively.  Thus, S&P has revised its assessment of
UBB's capital and earnings to strong from adequate.

In S&P's view, in 2015 and the first quarter 2016, UBB
demonstrated stable financial performance.  S&P expects UBB will
sustain its profitability, despite a challenging domestic and
global operating environment characterized by low domestic GDP
growth prospects of an average of 1.6% in 2016-2019, low consumer
demand and investor activity, and deflation.  S&P expects return
on equity (ROE) will be about 5%-6% in 2016-2017.  The bank
achieved ROE of 4.2% in 2015 and 9.4% in the first three months of

S&P believes that UBB's contagion risk from its parent, National
Bank of Greece (NBG), has been contained by Bulgarian regulatory
actions and controls through the prevention of capital or
liquidity outflows to the parent, such as:

   -- UBB liquidating its exposure to NBG, except a EUR52 million
      subordinated loan to be repaid by year-end 2017 through
      annual installments, which accounted for about 2% of UBB's
      funding as of March 31, 2016.  UBB liquidating most of its
      interbank exposures with NBG.

   -- As part of the prevention of capital outflow mechanisms,
      UBB not being allowed to pay any dividends to NBG in 2014
      and 2015.  UBB containing the outflow of customer deposits
      during 2015.  Its total deposits increased by 1.4% to
      May 1, 2016, from year-end 2014.

   -- UBB maintaining a high ratio of liquid assets to customer
      deposits of 36% as of May 1, 2016.

S&P considers UBB to be an insulated subsidiary of NBG, and, given
the strong regulatory actions by the Bulgarian regulator, S&P has
delinked its long-term rating on UBB from the group credit profile
of NBG, which is currently 'SD' (selective default).

S&P continues to reflect possible contagion risk from NBG in its
assessment of UBB's business position and liquidity.  S&P's
moderate business position assessment continues to reflect
concerns on reputational contagion risk on the bank's franchise
and S&P's view of possible reduced prospects for UBB to attract
customers, due to its ownership by the Greek bank.  S&P's moderate
liquidity assessment continues to reflect concerns of potential
customer deposit outflows from UBB due to uncertainties related to
its ownership.  Thus, S&P also affirmed its 'C' short-term rating
on UBB.

Positively, in the second half 2015 and the first four months
2016, the bank saw some growth in retail deposits, which enabled
it to show only a 2.3% decline in retail deposits from year-end
2014 to May 1, 2016.  This compares to retail deposits outflows by
5.5% in the first half of 2015, reflecting contagion risk from its
parent NBG.  Corporate deposits, including government entities and
nonbank financial institutions, increased by 12% from year-end
2014 to May 1, 2016.  Thus, total deposits increased by 1.4% from
year-end 2014 to May 1, 2016.  S&P will continue to closely
monitor the balances of retail and corporate deposits at UBB, but
does not expect significant outflows in the rest of 2016,
according to S&P's base-case scenario.

The stable outlook on UBB mainly reflects S&P's expectation that
the bank will maintain a stable financial and liquidity profile in
the next 12 months and be able to contain contagion risk from its
parent NBG, assisted by the Bulgarian National Bank's preventative
actions.  S&P also expects continued positive developments in
UBB's financial and business profile over the next two to three

S&P could lower the ratings on UBB in the next 12 months if:
contagion risk were to materialize and erode UBB's stand-alone
credit profile, especially with regard to weakening funding and
liquidity from material deposit outflows; UBB's business
continuity was threatened by adverse developments at the parent;
or economic and industry risks in the Bulgarian banking sector
increased substantially.

S&P could upgrade UBB in the next 12 months if it sees a marked
reduction in contagion risk from NBG, either due to NBG's improved
financial standing or the sale of UBB to a more creditworthy
investor.  At the same time, S&P would expect to see UBB
demonstrate stable funding and liquidity metrics, with a reversal
in the negative trend in economic and industry risks for Bulgarian


GERMAN PELLETS: June 30 Deadline to Register for Creditors Mtg Set
The insolvency court at Schwerin local court ("Amtsgericht") has
invited the holders of three bonds as well as of the participation
certificates issued by German Pellets GMBH to attend creditors'
meetings in July 2016 in accordance with Sec. 19 (2) SchVG
"Schuldverschreibungsgesetz" (German Bonds Act).  The deadline for
registration expires on June 30, 2016; any registrations received
after that date must still be taken into account -- even on the
date of the meeting.  Nevertheless, the creditors must take action
now in order to assert their rights at the creditors' meetings.

The insolvency court did not meet the request to appoint a proxy
for the holders of German Pellets GmbH's bonds and participation

Law firm Kanzlei MATTIL undertakes to exercise the voting rights
of the holders of the bonds and participation certificates at the
creditors' meetings in Schwerin on these securities, free of

  Meeting Date           Securities Type
  ------------           ---------------
  July 5, 2016           Bond 2011/16, ISIN: DE000A1H3J67,
                         securities ID number: A1H3J6

  July 6, 2016           Bond 2013/18, ISIN: DE000A1TNAP7,
                         securities ID number: A1TNAP

  July 7, 2016           Bond 2014/19, ISIN: DE000A13R5N7,
                         securities ID number: A13R5N

  July 8, 2016           Participation certificates, ISIN:
                         DE000A141BE2, securities ID number:

In this way, investors unable to attend the meetings in Schwerin
on the above dates can take part in the voting.

The insolvency administrator will inform the holders of the bonds
and participation certificates on the status of proceedings on the
dates.  After the report from the insolvency administrator, the
creditors can appoint a joint representative. The joint
representative will represent the interests of all bondholders
vis-a-vis the insolvency administrator and will receive payment
from the insolvency assets.

Kanzlei MATTIL will inform the investors it represents in a timely
manner on the outcome and content of the insolvency
administrator's report.

Sascha Borowski, a specialist attorney for banking law and capital
markets law from Kanzlei MATTIL in Munich, is a member of the
provisional creditor committee at German Pellets GmbH (for the
bondholders there) and is putting himself forward for the position
of joint representative.


IRISH BANK: Former Chief Executive Appeals Bankruptcy Ruling
Simon Carswell at The Irish Times reports that former Anglo Irish
Bank chief executive David Drumm has accused the bank and the
official overseeing his US bankruptcy of a "tirade of
vilification" of him.

Mr. Drumm made the claim in a new legal filing to a US appeals
court where he is seeking, for the second time, to reverse the
ruling of a Massachusetts judge and have debts of EUR10 million
discharged with a declaration of bankruptcy, The Irish Times

The former banker, who is representing himself in his appeal to
the Boston-based First Circuit Court of Appeals, lost his bid for
a fresh financial start in 2015 when the Massachusetts bankruptcy
court found that he had deliberately failed to disclose hundreds
of thousands of dollars in asset and cash transfers to his wife,
The Irish Times recounts.  That ruling was upheld on appeal by the
US District Court last year, The Irish Times notes.

According to The Irish Times, Mr. Drumm has blamed his US
bankruptcy lawyers for not advising him to disclose the transfers
to his wife Lorraine that began as the banking crisis deepened in
September 2008 and continued as the bank edged towards collapse
and after he resigned from the bank in December 2008.

Last month, the State-owned bank, Irish Bank Resolution
Corporation, and Mr. Drumm's US bankruptcy trustee, Kathleen
Dwyer, seeking the full repayment of his personal debts, told the
appeals court the 2015 bankruptcy court ruling should stand
because Mr. Drumm "strategically omitted information, provided
misleading testimony and forced a belabored discovery process",
The Irish Times discloses.

On June 24, in the latest twist in the five-year-old bankruptcy
case, Mr. Drumm, as cited by The Irish Times, said in a 12-page
replying brief that IBRC and Ms. Dwyer were vilifying him to
distract the court from considering Mr. Drumm's appeals arguments
and in particular, the clear testimony of "credible witnesses
other than Mr. Drumm."

In March, Mr. Drumm returned to Ireland from Massachusetts, his
home since 2009, following extradition proceedings taken by the US
government last October acting on behalf of the Irish authorities,
The Irish Times relays.

He will face two trials, in 2017 and 2018, in connection with
alleged offenses committed while he was chief executive of Anglo,
The Irish Times states.  He is contesting the charges, The Irish
Times notes.

                   About Irish Bank Resolution

Irish Bank Resolution Corp., the liquidation vehicle for what was
once one of Ireland's largest banks, filed a Chapter 15 petition
(Bankr. D. Del. Case No. 13-12159) on Aug. 26, 2013, to protect
U.S. assets of the former Anglo Irish Bank Corp. from being
seized by creditors.  Irish Bank Resolution sought assistance
from the U.S. court in liquidating Anglo Irish Bank Corp. and
Irish Nationwide Building Society.  The two banks failed and were
merged into IBRC in July 2011.  IBRC is tasked with winding them
down and liquidating their assets.  In February, when Irish
lawmakers adopted the Irish Bank Resolution Corp., IBRC was
placed into a special liquidation in the Irish High Court to
complete liquidation and distribution of the two banks' assets.

IBRC's principal asset as of June 2012 was a loan portfolio
valued at some EUR25 billion (US$33.5 billion).  About 70 percent
of the loans were to Irish borrowers. Some 5 percent of the
portfolio was under U.S. law, according to a court filing.  Total
liabilities in June 2012 were about EUR50 billion, according
to a court filing.

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

IBRC was granted protection under Chapter 15 of the U.S.
Bankruptcy Code in December 2013.

Kieran Wallace and Eamonn Richardson of KPMG have been named the
special liquidators.


ITALY: Prepares EUR40BB Bank Rescue Following Brexit After-Shocks
Ambrose Evans-Pritchard at The Telegraph reports that Italy is
preparing a EUR40 billion rescue of its financial system as bank
shares collapse on the Milan bourse and the powerful after-shocks
of Brexit shake European markets.

An Italian government task force is watching events hour by hour,
pledging all steps necessary to ensure the stability of the banks,
The Telegraph relays.

"Italy will do everything necessary to reassure people," The
Telegraph quotes premier Matteo Renzi as saying.

The country is the first serious casualty of Brexit contagion and
a reminder that the economic destinies of Britain and the rest of
Europe are intimately entwined, The Telegraph notes.  Morgan
Stanley, The Telegraph says, warned in a new report that eurozone
GDP would contract by almost as much as British GDP in a "high
stress scenario".

Italian officials are studying a direct state recapitalization of
the banks, to be funded by a special bond issue, The Telegraph
discloses.  According to The Telegraph, they also want a
moratorium of so-called 'bail-in' rules and bondholder write-
downs, but these steps are impossible under EU laws.  Mr. Renzi
raised the subject urgently at a meeting with German Chancellor
Angela Merkel and French president Francois Hollande at a Brexit
summit in Berlin on June 27, The Telegraph relates.

PRIVILEGE YARD: July 8 Bid Submission Deadline Set for Assets
Avv. Daniela De Rosa, the Official Receiver of Privilege Yard
S.p.A. (Bankruptcy No. 19/2015), said that given no bids were
received for auction on May 27, 2016, Bankruptcy Judge Giuseppe
Bianchi has authorized the sale of the company's shipbuilding
complex in a single lot through a transparent and competitive

The shipbuilding complex is located in Civitavecchia,
specifically in the La Mattonara -- Port Area.  It includes
tangible and intangible elements, namely:

   -- Luxury ship (the "Privilege One P430") holding under 36
      passengers under construction, with steel hull, listed under
      no. 2/2008 in the Registry of Ships under Construction at
      the Port of Civitavecchia, length overall approximately
      125.30 m, breadth 18.32 m, moulded depth 7.50 m, TSL
      (provisional gross tonnage) approximately 7500 GT, as
      explained in the appraisal drawn up by Prof. Ing. Dario

   -- Industrial site built on a State-owned area, Merchant Navy
      Section, under the Concession dated November 29, 2007, ref.
      no. 3315 and ensuing addenda dated July 29, 2009, ref. no.
      3540, and dated January 5, 2011, ref. no. 3784, on a total
      surface of 102,200 sq.m, occupied by no. 11 buildings and
      no. 3 electrical substations, all registered under Category
      D/7, as explained in the appraisal drawn up by Arch. Claudia

   -- A 1,130 kWp photovoltaic system installed on almost all of
      the rooftops of the buildings, covering a surface of 24,500
      sq.m, as explained in the appraisal drawn up by Arch.
      Claudia Ferreri;

   -- Movable property, excluding property on board the ship,
      relating to the property under the leases, as well as to
      claims and/or restitution, as referred to in the appraisal
      drawn up by Ing. Bruno Del Pico.

The sale is subject to prior consent to subrogation by the Port
Authority of Civitavecchia, Fiumicino and Gaeta, pursuant to art.
46 of the Navigation Code, to art. 30 of the Navigation Code
Rules, and to art. 18 of the Regulations of the Public Sea Areas
of the ports of Civitavecchia, Fiumicino and Gaeta.

The price of the entire lot is EUR59,000,000 in addition to
charges, if any.

Bids lower than 65% of the estimated value are considered null.

Bids shall be submitted, under penalty of exclusion, as set out
in the tender specifications made available by entering the
bankruptcy data room, by 6:00 p.m. on the day before the tender,
scheduled at 4:00 p.m. on July 8, 2016 at the office of the
delegated notary Andrea Panno, in via Tagliamento no. 14, Rome.

The notice of sale and the tender specifications, in full, as
well as all of the documents relating to the sale, including the
appraisals, are made available by entering the procedure data
room, prior to application for the issue of the relating
credentials, to be e-mailed to and payment
of the sum of EUR200 to be made on the current account of the
bankruptcy, as indicated in the email reply.

For further information, one may contact telephone number


NEPTUNO CLO I: S&P Affirms CCC- Ratings on 2 Note Classes
S&P Global Ratings raised its credit ratings on Neptuno CLO I
B.V.'s class A-T, A-R, B1, B2, C, D, and Y combo notes.  At the
same time, S&P has affirmed its ratings on the class E1 and E2

The rating actions follow S&P's analysis of the transaction's
performance and the application of its relevant criteria.

Since S&P's previous review on July 15, 2015, the rated notes have
been positively affected by an increase in the par coverage
resulting from the class A-T and A-R notes' amortization.

The class Y combo notes have continued to receive distributions
from their class C component.  The rated balance of the class Y
combo notes has reduced to 72% of the initial balance.

S&P subjected the capital structure to its cash flow analysis to
determine the break-even default rate (BDR) for each class of
notes at each rating level.

The BDRs represent S&P's estimate of the level of asset defaults
that the notes can withstand and still fully pay interest and
principal to the noteholders.

S&P has estimated future defaults in the portfolio in each rating
scenario by applying its updated corporate collateralized debt
obligation (CDO) criteria.

S&P's analysis shows that the available credit enhancement for the
class A-T, A-R, B1, B2, C,D, and Y combo notes is now commensurate
with higher ratings than those previously assigned.  Therefore,
S&P has raised its ratings on these classes of notes.

S&P's analysis also indicates that the available credit
enhancement for the class E1 and E2 notes is still commensurate
with the currently assigned ratings.  Therefore, S&P has affirmed
its 'CCC- (sf)' ratings on the class E1 and E2 notes.

Neptuno CLO I is a cash flow collateralized loan obligation (CLO)
transaction managed by BNP Paribas Asset Management.  A portfolio
of loans to mainly speculative-grade corporates backs the
transaction.  Neptuno CLO I closed in May 2007 and its
reinvestment period ended in November 2014.


Neptuno CLO I B.V.
EUR512.081 mil senior secured fixed- floating-rate revolving and
deferrable notes
Class              Identifier       To                  From
A-T                640804AA8        AAA (sf)            AA+ (sf)
A-R                640804AB6        AAA (sf)            AA+ (sf)
B1                 640804AC4        AA+ (sf)            AA- (sf)
B2                 640804AD2        AA+ (sf)            AA- (sf)
C                  640804AE0        AA+ (sf)            A (sf)
D                  640804AF7        A- (sf)             BBB- (sf)
E1                 640804AG5        CCC- (sf)           CCC- (sf)
E2                 640804AH3        CCC- (sf)           CCC- (sf)
Y Combo            640804AK6        AA+p (sf)           Ap (sf)

OI BRASIL: Syzygy Capital Files Bankruptcy Petition in Amsterdam
Ana Mano at Reuters reports that Syzygy Capital Management Ltd.,
unit of distressed debt firm Aurelius Capital Management LP, asked
a Dutch court on June 27 to start bankruptcy proceedings against a
Netherlands subsidiary of phone company Oi SA, which last week
filed Brazil's largest-ever bankruptcy protection request.

According to Reuters, Aurelius said in a statement on June 27
Syzygy owns bonds sold by Oi Brasil Holdings Cooperatief UA, a
Netherlands subsidiary of the Brazilian phone company.

Oi confirmed the "involuntary bankruptcy" filing by Syzygy in the
Dutch court in a statement later on June 28, Reuters relates.  Oi
added that Syzygy's filing relates to US$800,000 of Oi Brazil
Holdings bonds, Reuters notes.

The Syzygy petition was filed in an Amsterdam district court,
which is expected to schedule hearings on the process shortly,
Reuters relays.

TITAN EUROPE 2007-2: Fitch Cuts Rating on Class B Notes to 'Csf'
Fitch Ratings has downgraded Titan Europe 2007-2 Limited's class
A2 and B floating rate notes due 2017 as follows:

  EUR63.9 million Class A2 (XS0302916381) downgraded to 'CCCsf'
  from 'Bsf'; Recovery Estimate (RE) RE100%

  EUR154.3 million Class B (XS0302917272) downgraded to 'Csf' from
  'CCsf'; RE35%

  EUR115.2 million Class C (XS0302917512) affirmed at 'Csf'; RE0%

  EUR86.1 million Class D (XS0302917868) affirmed at 'Csf'; RE0%

  EUR37.9 million Class E (XS0302919138) affirmed at 'Csf'; RE0%

  EUR12.5 million Class F (XS0302919641) affirmed at 'Dsf'; RE0%

  EUR0 million Class G (XS0302920730) affirmed at 'Dsf'; RE0%

Titan Europe 2007-2 Limited is a CMBS transaction secured by three
loans backed by commercial real estate assets in the Netherlands,
Finland and the Czech Republic.


The downgrade of the senior notes reflects the proximity to legal
final maturity (LFM) and the slow pace of completed sales since
Fitch's last rating action. Recoveries from property sales over
the last year were slightly better than anticipated, which has
driven a small improvement in the RE for the class B notes.

Two loans have repaid at a discount since Fitch's last rating
action. The Nantes loan was cancelled in January registering a
EUR2 million loss, which was applied to the class F notes. A
smaller loss of EUR0.5 million was incurred in July following the
resolution of the Caprice loan. Both recovery outcomes were in
line with Fitch's expectations.

The current low interest rate environment is helping the remaining
three floating rate loans reduce leverage via cash sweep. However,
the prospect of repaying a material sum of note balance by LFM in
April is narrowing, underlining the possibility of a class A2
event of default. In Fitch's view a sale of the MPC portfolio
would be required to avert this outcome. Such a sale should raise
enough proceeds to repay class A2 in full, which supports its 100%

Investor appetite for the properties backing the Finnish Cobalt
loan is weak, while the Czech Skoduv Palace loan is subject to
ongoing disputes, meaning that resolution of either in the near
term is unlikely. Whether the tenant in the Czech property will
appeal a court ruling that found in favor of the landlord is
creating uncertainty, and will hinder attempts to refinance the

The limited demand for secondary Finnish assets of the kind that
back Cobalt is reflected in an updated valuation, which reports a
38% decline in market value (estimated at EUR23m, assuming
individual property sales over a 12 month period) since the
previous appraisal in 2013. The five properties that have been
sold out of this portfolio in the last year have been released at
less than half of their 2013 market value. Even at depressed
values it is likely that full resolution of this loan will stretch
beyond LFM.


Any notes outstanding at legal final maturity will be downgraded
to 'Dsf' and withdrawn.

Fitch estimates total loan recoveries in its 'Bsf' scenario to be
approximately EUR141m.


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


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

Fitch did not undertake a review of the information provided about
the underlying asset pool ahead of the transaction's initial
closing. The subsequent performance of the transaction over the
years is consistent with the agency's expectations given the
operating environment and Fitch is therefore satisfied that the
asset pool information relied upon for its initial rating analysis
was adequately reliable.

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


ALFA-BANK: Fitch Affirms 'BB+' LT Issuer Default Ratings
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDR) of Alfa-Bank (Alfa) at 'BB+', Credit Bank of Moscow (CBM) at
'BB', and Bank Saint Petersburg (BSPB) at 'BB-'. The Outlooks on
Alfa's and CBM's ratings are Negative, while those on BSPB's are


The three banks' IDRs and National Ratings are driven by their
standalone financial strength, as reflected in their Viability
Ratings (VR). The VRs acknowledge the banks' solid domestic
franchises, significant resilience to potential asset quality
deterioration due to reasonable capital levels and performance,
and comfortable liquidity buffers.

Alfa remains the highest-rated Russian privately-owned bank due to
its larger franchise with access to top tier borrowers/depositors,
good management, robust pre-impairment profitability and good
track record of managing through past Russian crises. CBM is rated
one notch lower than Alfa due to its higher risk appetite, weaker
capitalization and more significant downside asset quality risks.
BSPB is rated one notch lower than CBM due to its smaller
franchise with somewhat lower profile/weaker quality borrowers and
lower profitability through the cycle.

The Negative Outlooks on Alfa's and CBM's ratings mainly reflect
the weak Russian operating environment, which will continue to put
pressure on the banks' asset quality. It also reflects Fitch's
view that it is appropriate to maintain a one-notch (Alfa) and
two-notch (CBM) differences between the ratings of the banks and
the Russian sovereign (BBB-/Negative). The Stable Outlook on BSPB
reflects Fitch's view that the bank's lower ratings have somewhat
more tolerance to potential asset quality deterioration and are
less closely linked to the Russian sovereign rating.


Alfa's asset quality deteriorated in 2015, with non-performing
loans (NPLs; more than 90 days overdue) increasing to 6.9% from
2.7%, mainly in the corporate book, while restructured loans were
negligible. At the same time, the NPL reserve coverage reduced to
0.9x from 2.1x, which is still solid, because larger partially
reserved NPLs have good recoverability prospects due to strong
collateral coverage or some form of state backing.

Performance of retail lending improved in 2H15 after a weak 1H15
due to recovering margins and easing credit losses. The retail NPL
origination ratio (calculated as the increase in NPLs plus write-
offs divided by average performing loans; a good proxy for credit
losses) was 10% in 2015 (7% in 2014), while the breakeven level is
estimated at about 13%.

Pre-impairment profit was equal to a sound 5.5% of average gross
loans in 2015 (up from 3.6% in 2014), although the net interest
margin narrowed to 4% from 5.4%. Net performance recovered
moderately in 2015 (ROAE of 11%) thanks to lower impairment
charges and decrease in operating expenses but also underpinned by
FX gains, while comprehensive income was around breakeven due to
FX revaluation losses, an improvement on a USD0.4bn loss in 2014.
Fitch expects profitability to improve moderately in 2016 due to
reducing funding costs and lower credit losses.

Capitalization improved due to the depreciation-driven decrease in
dollar terms (Alfa's IFRS reporting currency) of the rouble-
denominated risk-weighted assets, while the dollar value of
capital was preserved through open currency position management
with derivatives. The Fitch Core Capital (FCC) ratio was a solid
16.7% at end-2015, while the Basel Tier 1 and total capital ratios
were also robust, at 16.8% and 21.7%, respectively.

Regulatory capitalization is tighter. The Tier 1 ratio was 8.6% at
end-4M16, providing only a moderate cushion over the required
minimum of 6.775% (including applicable buffers, rising to 9.5% by
2019), while the total capital ratio was 14.3%, comfortably above
the 8.775% minimum, supported by RUB63bn of Tier 2 capital
received from the Deposit Insurance Agency (DIA) in 2015 as part
of the sector support program. Tier 1 capital may be supported by
a planned perpetual debt issue, while loan growth is projected to
be moderate in 2016.

Alfa has a sound cushion of liquid assets (cash and equivalents,
net short-term interbank placements and securities eligible for
repo funding with the Central Bank of Russia), which covered
customer accounts by 62% at end-1Q16. Refinancing risks are
limited, with only USD0.5bn of wholesale funding (about 2% of
liabilities) due in April-December 2016.


The affirmation of ABHFL's ratings reflect Fitch's view that
default risk at the bank and the holding company are likely to be
highly correlated in view of the high degree of fungibility of
capital and liquidity within the group, which is managed as a
single entity. The currently limited volume of holding company
debt to non-related parties also supports the close alignment of
its ratings with Alfa.

The one-notch difference between the bank and holding company
ratings reflects the absence of any regulation of the consolidated
group, the fact that the holding company is incorporated in a
different jurisdiction and the high level of double leverage at
the holding company. The latter, defined by Fitch as equity
investments in subsidiaries divided by holdco equity, was 145% at
end-5M16, down from 165% at end-2014, due to the effective
conversion of some related party liabilities into equity. If all
the remaining related party funding was converted, the double
leverage ratio would have fallen to around 125%, or even lower if
some equity investments had been restated at fair value.

ABHFL is shielded from any potential Cyprus transfer risks by
having substantial foreign assets and earnings and limited
domestic liabilities. Fitch understands that ABHFL's ability to
repay/pay interest on external liabilities is not dependent on the
local financial system, because this will be done by ABHFL
transferring funds from accounts with Alfa directly to the paying


CBM's NPLs increased moderately to 5.4% of gross loans at end-1Q16
from 5.1% at end-2015 and 2.3% at end-2014. Restructured loans
were a further 2%. At end-1Q16, NPLs were 1.2x covered by

The quality of CBM's largest exposures is generally reasonable, in
Fitch's view, due to either only moderate deterioration of the
borrowers' financial performance to date or collateral coverage.
However, among the 25 largest loans, Fitch identified RUB54bn (57%
of end-1Q16 FCC) of higher-risk exposures to financially weak
and/or insufficiently collateralized borrowers. Additionally,
there are about RUB20bn (21% of FCC) of high risk exposures among
CBM's interbank loans (some could be fiduciary), bonds and reverse
repos (due to fairly low discounts on generally low-liquid
collateral and high counterparty risks). Fitch believes that CBM
will have to absorb additional credit losses related to at least
some of these exposures.

CBM's loss absorption capacity is significant, in our view. Fitch-
forecasted pre-impairment profit of around 40bn for 2016 should be
sufficient to create provisions equal to about 6% of average gross
loans or 54% of the above-mentioned high risk exposures and still
remain breakeven. Fitch expects loan impairment charges to
slightly reduce compared to 2015 but to remain elevated for 2016-
2017 at around 4%-5% of average gross loans (2015: 5.4%). This
would allow CBM to book only moderate bottom line gains
(annualized ROE for 1Q16 equalled 7%) in 2016.

The bank's capitalization is moderate, as expressed by a 9.4% FCC
ratio at end-1Q16. Capitalization was supported in 2H15 as CBM
raised RUB30bn of equity from several new institutional investors
through two public offerings. CBM has credit exposure to its new
institutional shareholders through the loan book, reverse repos,
bonds and interbank placements equal to RUB47bn (51% of FCC) at
end-1Q16. Although the credit quality of these exposures is
largely reasonable in most cases, there are some risks over the
quality of the new capital.

CBM's funding is extremely concentrated, as at end-1Q16 around
RUB460bn of term deposits (36% of total liabilities) were from a
group of companies related to a large Russian corporate. These
deposits mostly mature in 2H16-1Q17. Fitch believes the liquidity
risk associated with these placements is manageable, as CBM has
invested the money in assets, which are likely to be repaid prior
to maturity of these deposits. Wholesale funding refinancing needs
(excluding repo transactions) for the rest of 2016 are limited to
RUB90bn (7% of liabilities). At end-1Q16 CBM's liquidity buffer
equalled a significant RUB430bn or 34% of liabilities.


BSPB's NPLs accounted for 5.6% of total gross loans at end-1Q16,
up from 3.2% at end-1H15. Restructured exposures made up a further
7% of gross loans, resulting in total problem loans of around 13%.
NPLs were fully covered by reserves, while coverage of total
problem loans was 80%, which is adequate as most restructured
exposures are performing and secured by operating real estate with
reasonable LTVs.

The FCC ratio remained at 10.9% during 2015 as 8% annual lending
growth was compensated by similar internal capital generation. The
regulatory Tier 1 ratio was a lower 8.9% at end-4M16 (preserving a
moderate cushion over the required minimum of 6.625% including
capital conservation buffer) mainly due to capital hyperinflation
adjustment in IFRS and lower retained earnings in local GAAP, and
the total regulatory ratio was a solid 14.5% (significantly above
the 8.625% minimum) supported by RUB14.6bn of subordinated loans
from the DIA.

The net interest margin recovered slightly to 4% in 1Q16 after
falling to 3.8% in 2015 from 4.9% in 2014. Pre-impairment
profitability was a solid 3.3% of average assets in 1Q16 (3.2% in
2015) underpinned by trading gains. Impairment charges remained
high, at 68% of pre-impairment profit in 1Q16 (72% in 2015)
compared with 57% in 2014, and consequently bottom line ROAE was a
moderate 8.2% (6.7% in 2015), compared with 9.6% in 2014.

The bank is funded mainly by customer accounts, which made up 80%
of funding net of direct repos. BSPB has an adequate cushion of
liquid assets which net of market funding maturing within one year
covered customer accounts by a significant 25% at end-4M16.


Given Alfa's broad franchise, there is a moderate probability of
support from the Russian authorities, as reflected in the '4'
Support Rating and 'B' Support Rating Floor. Also Alfa's owners
have supported the bank in the past, and, in Fitch's view, would
have a strong propensity to do so again, if required. Their
ability to provide support is also likely to be significant, as
they seem to have little debt and significant cash reserves
following recent asset sales. However, Fitch does not formally
factor shareholder support into the ratings given limited
visibility of the shareholders' current position and Alfa's
significant size.

The '5' Support Ratings of CBM and BSPB reflect Fitch's view that
support from the banks' private shareholders cannot be relied
upon. The Support Ratings and Support Rating Floors of 'No Floor'
also reflect that support from the Russian authorities, although
possible given the banks' significant deposit franchises, cannot
be relied upon due to their still small size and lack of overall
systemic importance.


The banks' senior unsecured debt is rated in line with their Long-
Term IDRs and National Ratings (for domestic debt issues). The
subordinated debt ratings are notched down once from the VRs,
which incorporates zero notches for incremental non-performance
risk and a notch for higher loss severity.


A revision of the Outlook on Alfa's and CBM's ratings to Stable
would probably require an improvement in the operating environment
and the revision of the Outlook on the Sovereign rating to Stable.

Alfa and CBM could be downgraded in case of a sovereign downgrade,
or if there is a significant asset quality and performance
deterioration (these risks are somewhat more pronounced for CBM),
if it leads to material capital erosion and is not promptly cured
by shareholders.

ABHFL's ratings are likely to move in tandem with Alfa's. In
addition, ABHFL could be downgraded if its planned future debt
issuance results in a marked increase in double leverage or gives
rise to significantly increased liquidity risks at the holdco
level, something which is not currently anticipated by Fitch.

Alfa's Support Rating will likely be downgraded to '5', and its
Support Rating Floor revised downward to 'No Floor', once Russia
implements legislation providing for bail-in of senior liabilities
of failed banks. Russian officials have stated that this
legislation is likely to be implemented by end-2017.

Upside potential for BSPB's rating is currently limited given the
weak economic outlook. As with Alfa and CBM, ratings could be
downgraded in case of a marked deterioration in asset quality and

The rating actions are as follows:


Long-Term Foreign Currency IDR: affirmed at 'BB+'; Outlook

Long-Term Local Currency IDR: affirmed at 'BB+'; Outlook Negative

Short-Term Foreign Currency IDR: affirmed at 'B'

National Long-Term rating: affirmed at 'AA+(rus)'; Outlook Stable

Viability Rating: affirmed at 'bb+'

Support Rating: affirmed at '4'

Support Rating Floor: affirmed at 'B

Senior unsecured debt: affirmed at 'BB+'/ 'AA+(rus)'

Subordinated debt: affirmed at 'BB'

Senior unsecured debt of Alfa Bond Issuance Public Limited
Company: affirmed at 'BB+'

Subordinated debt of Alfa Bond Issuance Public Limited Company:
affirmed at 'BB'

ABH Financial Limited

Long-Term Foreign currency IDR: affirmed at 'BB'; Outlook

Short-Term Foreign currency IDR: affirmed at 'B'

Senior unsecured debt of Alfa Holding Issuance plc: affirmed at
'BB'/'BB (emr)'

Credit Bank of Moscow

Long-Term Foreign and Local currency IDRs: affirmed at 'BB',
Outlooks Negative

Short-Term Foreign Currency IDR: affirmed at 'B'

Viability Rating: affirmed at 'bb'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

National Long-Term Rating: affirmed at 'AA-(rus)'; Outlook

Senior unsecured debt: affirmed at 'BB' and 'BB(EXP)'

Senior unsecured debt National Rating: affirmed at 'AA-(rus)' and

CBOM Finance PLC (Ireland)

Senior unsecured debt: affirmed at 'BB'

Subordinated debt: affirmed at 'BB-'

Bank Saint Petersburg OJSC

Long-Term Foreign and Local Currency IDRs: affirmed at 'BB-',
Outlooks Stable

Short-Term Foreign Currency IDR: affirmed at 'B'

Viability Rating: affirmed at 'bb-'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

National Long-Term Rating: affirmed at 'A+(rus)', Outlook Stable

Senior unsecured debt: affirmed at 'BB-'

Senior unsecured debt National Rating: affirmed at 'A+(rus)'

Subordinated debt (issued by BSPB Finance plc): affirmed at 'B+'

BRUNSWICK RAIL: Draws Up New Debt Restructuring Offer
Luca Casiraghi at Bloomberg News reports that Brunswick Rail Ltd.,
the Russian railcar lessor struggling to repay foreign debt
following a plunge in the ruble, issued a last-ditch bond-
restructure plan after talks with creditors broke down.

According to Bloomberg, a Brunswick statement said the company is
giving holders of US$600 million of bonds due in November next
year the option of either cashing out 51% of the notes' face value
in rubles or getting a 38% payout and new payment-in-kind notes,
also in rubles, which would give creditors the right to acquire as
much as 25% of equity.

Brunswick Rail halted negotiations with a group of bondholders on
June 24 after both sides rejected proposals to restructure the
debt, Bloomberg relates.  Talks had started in January after a 50%
decline in the ruble since 2014 increased the cost of repaying
debt in foreign currencies, Bloomberg recounts.  The statement
said the new proposal is "subject to further structuring,
discussions with noteholders and market conditions", Bloomberg

Brunswick Rail leases railcars to corporate clients in Russia.

                          *     *     *

As reported by the Troubled Company Reporter-Europe on Nov. 24,
2015, Standard & Poor's Ratings Services affirmed its long-term
corporate credit rating on Russia-based freight car lessor
Brunswick Rail Ltd. at 'CCC-'.  The outlook remains negative.
S&P said the affirmation reflects the rating agency's view that
Brunswick Rail continues to face a high risk of having to prepay
its RUB4 billion (about US$63 million) of its syndicated bank
loan due 2016 following the expiry of the waiver.  The company
was in breach of its leverage covenant under the facility (net
debt to EBITDA of 4.75x) as of the end of June 2015, which the
bank syndicate waived until the end of October 2015.

MOSENERGO AO: S&P Raises CCR to 'BB+', Outlook Negative
S&P Global Ratings raised its long-term corporate credit rating on
Russian energy company Mosenergo (AO) to 'BB+' from 'BB'.  The
outlook is negative.

At the same time, S&P raised its Russia national scale rating on
the company to 'ruAA+' from 'ruAA'.

The upgrade reflects that Mosenergo is close to finishing its
investment program and will therefore have lower and more flexible
capital expenditures (capex) from 2016.  Consequently, S&P
anticipates the company will generate positive free operating cash
flow, allowing it to consistently maintain moderate leverage,
namely with funds from operations (FFO) to debt of 35%-45%.  It
also factors in S&P's expectation of resilient operating
performance, due to the lucrative service area, despite Russia's
now weaker macroeconomic environment and supply-demand balance in
its electricity market.  S&P has therefore revised up its
assessments of the company's financial risk profile to
intermediate and of its stand-alone credit profile (SACP) to 'bb'.

S&P continues to factor in support from Mosenergo's parent,
Gazprom.  The Gazprom group owns a 53% stake in the company
through its fully owned subsidiary, Gazprom Energoholding.  S&P
thinks that Mosenergo is a strategic investment for the Gazprom
group, in line with the group's investments into other Russian
electricity and heat generators such as MIPC, OGC-2, and TGC-1,
and that it's unlikely Gazprom will sell Mosenergo in the near
term.  That said, S&P thinks that Mosenergo is less important for
the Gazprom group's long-term strategy than its core gas and oil
assets.  Therefore, S&P views Mosenergo as a moderately strategic
subsidiary of the Gazprom group.  This view results in the one-
notch uplift from the SACP that S&P includes in its rating on

Mosenergo's business risk profile continues to reflect inherent
volatility in the spot electricity market, its exposure to an
opaque and short-term heating tariff regime, and a track record of
state interventions into the industry.  Other constraints include
exposure to country risk in Russia, which S&P assess as high, and
below-average profitability due to low return on capital.

Supportive factors include the company's solid competitive
position in the fairly affluent service area of Moscow city and
Moscow oblast (region), and the operational benefits of its
affiliation with and support from Gazprom.  The competitive
position is further underpinned by significant amounts invested
(Russian ruble [RUB] 110 billion in 2011-2015) into modernization
of its generating capacities and into the construction of new more
efficient combined cycle gas turbines, which improves the
company's competitiveness and operating efficiency.  The company
has also acquired some of the heating assets in Moscow from MIPC.
Although relatively weak on a stand-alone basis, these assets and
respective customers will be integrated into Mosenergo's existing
cogeneration capacities network, supporting capacity utilization
and efficiency.

S&P considers that Mosenergo's financial policy framework allows
the company to take a more leveraged position than S&P currently
factors into its base-case scenario, for example, in case of
acquisitions, additional investment projects, or a higher dividend
payout.  S&P reflects this in its negative financial policy
modifier, for which S&P deducts one-notch from the anchor of 'bb+'
that it applies to Mosenergo.

In its base-case scenario for Mosenergo, S&P assumes:

   -- GDP decline of 1.3% in Russia in 2016, with a recovery to
      1% in 2017, and broadly flat electricity consumption in

   -- Low-single-digit revenue growth in 2016-2017, supported by
      moderately growing electricity, capacity, and heat sales on
      the back of recently commissioned generation capacities and
      the acquired heat business from MIPC.

   -- Moderate contraction in EBITDA margins to about 14% due to
      the weaker electricity market.

   -- Annual capex of RUB12 billion-RUB13 billion.

   -- Dividends of about 50% of net income under International
      Financial Reporting Standards.

Based on these assumptions, S&P arrives at these credit measures
for the company:

   -- Adjusted EBITDA of RUB24 billion-RUB26 billion, compared
      with RUB28 billion in 2015.

   -- FFO to debt of 35%-45%.

   -- Debt to EBITDA of about 2x.

The negative outlook mainly reflects that on the ultimate parent,
Gazprom.  It also incorporates, indirectly, S&P's negative outlook
on the Russian Federation.

S&P would lower its rating on Mosenergo if S&P lowers the local or
foreign currency rating on Gazprom, because it would signal
Gazprom's lessened ability to support the company.  In addition,
S&P don't believe Mosenergo can be rated above its ultimate
parent, given Gazprom's majority ownership of the company and its
ability to control the company's strategy and financial policy.

S&P could also lower the rating if it saw significant
deterioration in Mosenergo's SACP, for example, if it made
acquisitions, with debt to EBITDA exceeding 3x and FFO to debt
falling below 30%.

S&P would revise the outlook on Mosenergo to stable if S&P took a
similar action on Gazprom and provided that Mosenergo's
performance remains resilient.  This would include an adjusted
FFO-to-debt ratio above 30% and a debt-to-EBITDA ratio below 3x on
a consistent basis.

SAMARA OBLAST: S&P Assigns 'BB' Rating to RUB10BB Sr. Unsec. Bond
S&P Global Ratings said that it has assigned its 'BB' long-term
global scale issue rating and 'ruAA' Russia national scale rating
to Samara Oblast's proposed Russian ruble (RUB) 10 billion (about
$155 million) eight-year senior unsecured bond.  S&P understands
that Samara Oblast (BB/Negative/--; Russia national scale 'ruAA')
plans to issue the bond on July 1, 2016.

The bond will have 32 quarterly fixed-rate coupons and an
amortizing repayment schedule.  The coupon rate will be disclosed
at the time of issuance.  According to the redemption schedule,
10% of the bond is to be repaid in 2020, 15% in 2021, 25% in 2022,
25% in 2023, and the remaining 25% in 2024.


Samara Oblast
Senior Unsecured
  RUB10 billion bonds due 06/21/2024
   Local Currency                        BB
   Russia National Scale                 ruAA

SCF CAPITAL: Fitch Assigns 'BB' Rating to 5.375% 2023 Notes
Fitch Ratings has assigned SCF Capital Limited's USD750 million
5.375% notes due in 2023 a final senior unsecured rating of 'BB'.
The notes are guaranteed by PAO Sovcomflot (BB/Stable).

The proceeds of the notes are planned to be used for refinancing
of USD660 million of the USD800 million Eurobonds due October 27,
2017 as part of Sovcomflot's proactive debt management policy. As
a result, Fitch does not expect this transaction to significantly
increase the amount of senior unsecured indebtedness. Although the
company has high senior secured debt, we rate the senior unsecured
notes in line with Sovcomflot's Long-Term Issuer Default Rating
(IDR). This is because the ratio of unencumbered assets to
unsecured debt is around Fitch's threshold of 2x.

SCF Capital Limited is indirectly a wholly owned subsidiary of
Sovcomflot, which unconditionally and irrevocably guarantees the
payments under the notes.

Sovcomflot's ratings reflect the steady improvement of its
financial profile, mainly driven by the tanker shipping sector's
recovery, while the company maintains heavy capex plans. The
company continues to benefit from a strong business profile, which
is compatible with the high 'BB' rating category. Sovcomflot's
'BB' Long-Term IDR incorporates a one-notch uplift for state
support to its standalone rating of 'BB-'.


Improving Financials

Sovcomflot outperformed Fitch's expectations for 2015 with
reported funds from operations (FFO) adjusted net leverage of 3.7x
and FFO fixed charge cover of 4.2x. Fitch expects FFO adjusted net
leverage to remain well below 5x and FFO fixed charge cover to
remain above 3x in 2016-2018. Given the volatile nature of freight
rates, Fitch has taken a through-the-cycle approach and assumed
10-year average spot tanker rates for the company's spot
operations from 2016. This forecast is driven mainly by sector
fundamentals and does not take into account the proceeds from the
company's potential IPO.

The improvement in conventional fleet performance, along with the
shift in the company's portfolio to higher-margin segments (eg gas
and offshore) should support higher profitability and visibility
in the medium term.

Improving Tanker Shipping Fundamentals

Fitch said, "We continue to expect better supply/demand balance
for tanker shipping in 2016 due to moderate supply growth
supporting capacity discipline and growing oil consumption,
coupled with regional changes in oil demand patterns having a
positive tonne-mile effect on tanker demand. While the improving
sector fundamentals may lead to higher vessel orders, they are
likely to be contained by limited available funding as banks
remain cautious with shipping exposure and are therefore unlikely
to materially pressure tanker rates over the next two to three

Long-term Contracts

Sovcomflot's business profile benefits from a fairly high share of
long-term contracts coverage with USD8.1bn of contracted revenue,
half of which will be generated over 2015-2022. About two-thirds
of the fleet operated on time charters in 2015. Operational
strength is also underpinned by a gradual shift towards more
profitable segments (eg LNG and offshore), which are expected to
account for half of the company's revenue by 2020, from just over
a third in 2015. Strong operations are also supported by the
company's leading global position as tankers owner and in certain
niche markets, a fairly young fleet and diversified customer base.

Sizeable CAPEX to Continue

Fitch said, "We expect Sovcomflot to remain highly capital-
intensive in the medium term as the company maintains its modern
and technologically advanced fleet, and to support its LNG and
offshore business. Sovcomflot plans to take delivery of eight more
new vessels (including four Icebreakers, three shuttle tankers and
one LNG vessel) over 2016-2017 following the delivery of 1 VLCC
and 4 LNG carriers in 2014 and 2015, respectively. All vessels are
planned for operation under long-term contracts."

Fitch said, "As a result, we do not expect a significant reduction
of average annual capex, which will remain around USD500m.
Maintenance capex is low at around USD40m annually. As a result of
the intensive capex programme, we forecast that Sovcomflot will
remain free cash flow (FCF) negative over 2016-2018, despite
rather solid cash flow from operations. This implies that a large
portion of its capex is debt-funded."

Diversified Customer Base

Sovcomflot has a diversified customer base consisting of large
international and Russian oil and gas players. Exposure to any
counterparty is limited to about 10% of revenue. The company has
purchased all of its LNG vessels for projects which are currently
operational, except for one vessel, which is on order now for the
Yamal project. According to Sovcomflot, the rate under long-term
contracts is set for the duration of the contract and not
dependent on oil or gas prices dynamics.

One-Notch Uplift for State Support

Sovcomflot's 'BB' Long-Term IDR incorporates a one-notch uplift to
its standalone rating of 'BB-' for state support as Fitch assesses
the strategic, operational and, to a lesser extent, legal ties
between the group and its 100% parent (the state) to be moderately
strong, despite the planned partial privatization of the company.
The strength of the ties is supported by Sovcomflot being integral
to the Russian government's energy strategy, Russia's growing oil
and gas market, close working relationship with state-owned oil
and gas companies and previous tangible financial support.

Senior Unsecured Rating

The rating of the senior unsecured notes remains aligned with the
company's Long-Term IDR, given adequate unencumbered assets, the
value of which is around 2x of unsecured debt. However, Fitch
would consider decoupling the ratings, should the amount of
unencumbered assets fall below this level.


Fitch's key assumptions within the rating case for Sovcomflot

-- No proceeds received by the company from potential IPO.
-- 10-year average freight rates for spot operations from 2016;
    contractual rates for time charters.
-- Capex and capacity expansion as per management business plan.


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

-- Material improvement of the company's credit metrics, with
    FFO adjusted net leverage well below 4.5x and FFO fixed
    charge cover above 3.5x on a sustained basis, due to, among
    other things, strong recovery of the tanker industry,
    significant downsizing of the capex program and/or
    reinvestment of IPO proceeds.

-- Evidence of stronger state support.

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

-- Decline of tanker rates and/or more sizeable capex resulting
    in deterioration of the company's credit metrics (eg FFO
    adjusted net leverage above 5.5x and FFO fixed charge
    coverage below 2.5x on a sustained basis).
-- Evidence of weaker state support.
-- Unencumbered assets falling below 2x of unsecured debt, which
    would lead to a downgrade of the senior unsecured rating.


Fitch views Sovcomflot's liquidity as adequate. The company's
unrestricted cash position of USD409.8 million at end-1Q16, along
with its undrawn portion of committed credit lines at USD806
million (85% of which is due in 2029), was sufficient to cover its
short-term debt of USD285.7 million. Its debt repayment schedule
is well balanced with a peak in 2017 due to the maturity of its
USD800 million eurobonds, USD660 million of which the management
plans to refinance with the USD750 million bond issuance. As a
global tanker shipping player, the company has demonstrated good
access to financial markets, having raised USD1,260m in bank
financing during December 2014-December 2015. Fitch expects
Sovcomflot to remain FCF negative over 2016-2018.

FX risk is low due to natural hedge as the company generates
revenue and cash flow in USD and raises debt in USD. Capex is also
USD-denominated, while most of operating costs are in USD.


ABANCA CORPORACION: Moody's Raises Long-Term Deposit Rating to B2
Moody's Investors Service has upgraded ABANCA Corporacion
Bancaria, S.A.'s long-term deposit ratings to B2 from Caa1.  The
rating agency has also upgraded the bank's baseline credit
assessment (BCA) and adjusted BCA to b2 from b3.  The bank's CR
Assessment has been upgraded to Ba3(cr) from B2(cr).  The outlook
on the long-term deposit ratings remains positive.

Abanca's Not-Prime short-term deposit ratings were unaffected by
today's rating action as well as the short-term CR Assessment of

This rating action reflects the improvement of Abanca's credit
fundamentals, primarily in terms of asset risk, capital and
liquidity metrics, as well as the result of Moody's Advanced Loss
Given Failure analysis, which indicates a lower loss-given-failure
to be faced by deposits in light of the bank's deleveraging and
deposit growth.

The positive outlook on Abanca's long-term deposit ratings
reflects the positive pressure that could develop on its ratings
if the improving trend observed on the bank's credit fundamentals
consolidates over the next 12-18 months.



The upgrade of Abanca's BCA to b2 from b3 is driven by
improvements in the bank's asset risk, capital and liquidity.  In
2015, Abanca materially reduced the volume of non-performing loans
(NPLs), which translated into a decline in the NPL ratio to 9.6%
in December 2015 from 13.4% in December 2014.  Although the
improvement did not translate to the volume of repossessed real
estate assets, which even increased throughout the year, the
bank's non-earning asset ratio (which combines NPLs and real
estate assets) still reduced to 13.9% from 16.6% over the period.

In terms of capital, Moody's calculated Tangible Common Equity
(TCE) ratio improved by 86 basis points to 8.8% at end-December
2015 from 7.9% at end-December 2014.  The improvement was due to
internal capital generation and the lower risk weighted assets
that Moody's assigns to the bank's sovereign exposure, following
the disposal of a large part of the sovereign debt portfolio in
the year.  Moreover, the improvement has been more visible in
terms of leverage, given the decline in total assets after the
portfolio sale.  Moody's calculated leverage ratio improved to
5.8% at end 2015 from 4.8% at end 2014.  From a regulatory
standpoint, Abanca's Common Equity Tier 1 ratio stood at 14.8% at
end 2015, above the system average of 12.6% as of the same date.

Similarly, Abanca's liquidity position materially improved
throughout 2015, as the bank was able to grow deposits which, at
the end of 2015, represented 71% of total funding compared to 59%
a year ago.  The sale of the sovereign debt portfolio also
translated into lower reliance on short-term funding, with
interbank and repos with customers representing less than 6% of
total funding at the end of 2015.

Despite the mentioned improvements, Abanca's BCA of b2 also
reflects the entity's weak recurring profitability, with net
interest income declining by 25% in 2015 and a pre-provision
income highly reliant on non-recurrent capital gains.  At the same
time, we note the still very high volume of problematic exposures
(measured as the addition of NPLs, foreclosed real estate assets
and refinanced loans classified as performing), which accounted
for 96% of the bank's shareholder equity plus loan loss reserves
as of end-December 2015.


The two-notch upgrade of Abanca's long-term deposit ratings to B2
from Caa1 reflects: (1) The upgrade of the bank's adjusted BCA to
b2 from b3; and (2) the result from the rating agency's updated
Advanced Loss-Given Failure (LGF) analysis, which provides a more
favorable outcome as a consequence of the decline in total assets
and the growth in deposits observed in 2015.  Moody's updated LGF
analysis indicates a moderate loss-given-failure for deposits
which translates into a one notch of uplift, compared to a high
loss-given-failure and one notch of negative uplift previously.
The B2 long-term deposit ratings also take into account Moody's
assessment of a low probability of government support, which
results in no uplift.

As part of today's rating action, Moody's has also upgraded by two
notches the CR Assessment of Abanca to Ba3(cr) from B2(cr), two
notches above the adjusted BCA of b2.  The CR Assessment is driven
by the banks' adjusted BCA, low likelihood of government support
and by the cushion against default provided to the senior
obligations represented by the CR Assessment by subordinated
instruments amounting to 8.5% of tangible banking assets.

he outlook on Abanca's long-term deposit ratings is positive,
reflecting the positive pressure that could develop on its ratings
if the improving trend observed on the bank's credit fundamentals
consolidates over the next 12-18 months.


An upgrade of Abanca's deposit ratings could arise as a result of
changes in the liability structure, which indicates a lower loss-
given-failure to be faced by deposits.

In terms of BCA, the ratings could be upgraded primarily as a
consequence of: (1) A sustained improvement of recurrent
profitability; (2) a further decline in the volume of problematic
assets; and/or (3) stronger capital and leverage ratios.


Given the positive outlook, Abanca's ratings show limited downward
pressure.  Nevertheless, Abanca ratings could be downgraded as a
result of: (1) A reversal in current asset risk trends translating
into an increase in the volume of problematic assets; (2) a
weakening of the bank's risk-absorption capacity as a result of
subdued profitability levels; and/or (3) any worsening, beyond our
current expectations, in operating conditions in the Spanish
operating environment, particularly in the region of Galicia.

Abanca's deposit ratings could also change as a result of changes
in the liability structure, which would indicate a higher loss-
given-failure to be faced by deposits.


Issuer: ABANCA Corporacion Bancaria, S.A.

  Adjusted Baseline Credit Assessment, upgraded to b2 from b3
  Baseline Credit Assessment, upgraded to b2 from b3
  Long-term Counterparty Risk Assessment, upgraded to Ba3(cr)
   from B2(cr)
  Long-term Deposit Ratings, upgraded to B2 from Caa1 , outlook
   remains Positive

Outlook Actions:
  Outlook remains Positive

CAIXABANK CONSUMO 2: Moody's Assigns B3 Rating to Series B Notes
Moody's Investors Service has assigned these definitive ratings to

  EUR1,170.0 million Series A Floating Rate Asset Backed Notes
   due April 2060, Definitive Rating Assigned Aa3(sf)

  EUR130.0 million Series B Floating Rate Asset Backed Notes due
   April 2060, Definitive Rating Assigned B3 (sf)

                         RATINGS RATIONALE

The transaction is a static cash securitization of unsecured
consumer loans as well as consumer loans backed by mortgages and
consumer drawdowns of related mortgage lines of credit extended to
obligors in Spain by CaixaBank S.A. (Baa1(cr)/P-2(cr), Baa2 LT
Bank Deposits).

The provisional portfolio of underlying assets consists of
unsecured and secured debt obligations originated in Spain for a
total balance of EUR1.39 bil., from which a final pool will be
selected, based on certain eligibility criteria, funded by the
issued notes equal to an amount of EUR1.30 bil.

Moody's expects the total balance of the final portfolio of
underlying assets consisting on unsecured and secured debt
obligations originated in Spain to be EUR1.3 bil.  Final pool will
be funded by the issued notes equal to an amount of
EUR1.3 bil.

As at May 2016, the provisional pool cut contains 145,036
contracts with a weighted average seasoning of 2.5 years.  The
portfolio consists of unsecured consumer loans and consumer loans
backed by mortgages or consumer drawdowns of related mortgage
lines of credit.  Loans are used for several purposes, such as new
or used car acquisition or repair, property improvement and other
undefined or general purposes.  Approximately 26.5% of the pools
is composed of vehicle related loans.  Consumer mortgage loans
constitute 15.82% of the pool, and drawdowns of mortgage lines of
credit make up 9.16%.

According to Moody's, the transaction benefits from credit
strengths such as the granularity of the portfolio, the high
excess spread and the financial strength and securitization
experience of the originator.  However, Moody's notes that the
transaction features some credit weaknesses such as commingling
risk and the high degree of linkage to CaixaBank.  In addition,
the transaction is exposed to interest rate risk due to the
absence of a swap, given that the notes pay floating and the
assets pay a mixture of fixed rates and floating rates referencing
a variety of indices.  Commingling risk is partly mitigated by the
transfer of collections to the issuer account on a daily basis.

Moody's analysis focused, amongst other factors, on (i) an
evaluation of the underlying portfolio of loans and the
eligibility criteria; (ii) historical performance information of
the total book and past ABS and RMBS transactions; (iii) the
credit enhancement provided by subordination and the reserve fund;
(iv) the static structure of the transaction (v) the liquidity
support available in the transaction by way of principal to pay
interest and the reserve fund; and the (vi) overall legal and
structural integrity of the transaction.

                      MAIN MODEL ASSUMPTIONS

Moody's determined a portfolio lifetime expected mean default rate
of 6.5%, expected recoveries of 35% and Aa2 portfolio credit
enhancement ("PCE") of 18% related to the combined pool of
unsecured and secured receivables.  The expected defaults and
recoveries capture our expectations of performance considering the
current economic outlook, while the PCE captures the loss we
expect the portfolio to suffer in the event of a severe recession
scenario.  Expected defaults and PCE are parameters used by
Moody's to calibrate its lognormal portfolio loss distribution
curve and to associate a probability with each potential future
loss scenario in its ABSROM cash flow model to rate consumer ABS


The principal methodology used in these ratings was "Moody's
Approach to Rating Consumer Loan-Backed ABS" published in
September 2015.

The ratings address the expected loss posed to investors by the
legal final maturity of the notes.  In Moody's opinion, the
structure allows for timely payment of interest and ultimate
payment of principal by the legal final maturity of the Class A
notes only.  Moody's ratings address only the credit risks
associated with the transaction.  Other non-credit risks have not
been addressed but may have a significant effect on yield to


Factors that may cause an upgrade of the ratings include a
significantly better than expected performance of the pool
together with an increase in credit enhancement of the notes.
Factors that may cause a downgrade of the ratings include a
decline in the overall performance of the pool and a significant
deterioration of the credit profile of the originator CaxiaBank


Moody's used its cash flow model ABSROM as part of its
quantitative analysis of the transaction.  ABSROM enables users to
model various features of a standard European ABS
transaction -- including the specifics of the loss distribution of
the assets, their portfolio amortization profile, yield as well as
the specific priority of payments, swaps and reserve funds on the
liability side of the ABS structure.  The model is used to
represent the cash flows and determine the loss for each tranche.
The cash flow model evaluates all loss scenarios that are then
weighted considering the probabilities of the lognormal
distribution assumed for the portfolio loss rate.  In each loss
scenario, the corresponding loss for each class of notes is
calculated given the incoming cash flows from the assets and the
outgoing payments to third parties and noteholders.  Therefore,
the expected loss or EL for each tranche is the sum product of (i)
the probability of occurrence of each loss scenario; and (ii) the
loss derived from the cash flow model in each loss scenario for
each tranche.


In rating consumer loan ABS, the mean default rate and the
recovery rate are two key inputs that determine the transaction
cash flows in the cash flow model.  Parameter sensitivities for
this transaction have been calculated in the following manner:
Moody's tested 9 scenarios derived from the combination of mean
default: 6.5% (base case), 7.5% (base case +1%), 8.5% (base case +
2.0%) and recovery rate: 35.0% (base case), 30% (base case - 5%),
25% (base case - 10.0%). The 6.5%/35% scenario would represent the
base case assumptions used in the initial rating process. At the
time the rating was assigned, the model output indicated that
Class A would have achieved Baa2 even if the mean default was as
high as 8.5% with a recovery as low as 15% (all other factors
unchanged).  Class B would have achieved Caa2 in the same

U N I T E D   K I N G D O M

BHS GROUP: FRC Opens Probe Into PwC's Audit Prior to Collapse
David Casey at Insider Media reports that the UK accountancy
watchdog has opened an investigation into
PricewaterhouseCoopersP's audit of BHS Group in the year before
the collapsed retailer was sold by Sir Philip Green's Arcadia

The Financial Reporting Council said its probe was into the year
ending August 30, 2014, Insider Media relates.

A spokesman for PwC, as cited by Insider Media, said: "We will co-
operate fully with the FRC in its inquiries."

According to Insider Media, the Big Four firm stepped down as
auditor in March 2015 after Sir Philip sold the department store
chain to Retail Acquisitions for GBP1.

In March 2016, BHS agreed a company voluntary arrangement with its
creditors, but collapsed into administration just a month later,
Insider Media relays.

Since then, the joint administrators from Duff and Phelps have
confirmed that all the retailer's 163 stores will be closed with
thousands of job losses, Insider Media discloses.

The conduct of directors and advisers in the run up to the
insolvency has also come under increasing scrutiny by MPs, Insider
Media notes.

BHS Group is a department store chain.  The company employs 10,000
people and has 164 shops.

HEALTHCARE SUPPORT: S&P Keeps 'B+' Rating on CreditWatch Positive
S&P Global Ratings said that it has kept its 'B+' issue rating on
senior secured debt issued by U.K.-based special-purpose vehicle
Healthcare Support (Newcastle) Finance PLC (ProjectCo) on
CreditWatch with positive implications.  The debt comprises a
GBP115 million senior secured European Investment Bank loan due
March 2038, and GBP197.82 million of senior secured bonds due
September 2041.

Both debt tranches benefit from an unconditional and irrevocable
payment guarantee of scheduled interest and principal provided by
Syncora Guarantee U.K. Ltd.  According to S&P's criteria, the
issue rating on debt guaranteed by a monoline insurer is the
higher of the rating on the insurer and the Standard & Poor's
underlying rating (SPUR).  Because S&P's do not rate Syncora, the
rating on the issues reflect the SPUR.

The recovery rating remains at '2', but S&P has revised its
recovery expectations to the lower half of the 70%-90% range to
reflect S&P's downside stress default scenario.  To date, however,
the U.K. private finance initiative sector has had limited
experience of defaults or losses.

The CreditWatch reflects S&P's view of continuing progress in
resolving the ongoing dispute between ProjectCo, the Newcastle
Upon Tyne Hospitals NHS Foundation Trust (the Trust), and the
project's construction contractor, Laing O'Rourke, relating to the
completion sign-off of the clinical office block and to
unavailability and performance deductions.  The final agreement is
expected to mark the end of the project's construction phase and
the transition to the operations phase, ending the dispute that
has strained relationships and overshadowed the project since the
original targeted construction completion date of May 2012.
Successful conclusion of the negotiations will, in S&P's opinion,
diminish the threat of project termination by the Trust.

The length of time it has taken to conclude the settlement
agreement reflects the complexity of negotiations and the decision
to include the facility management services provider, Interserve
FM, in the discussions.  S&P understands, however, that a heads-
of-terms agreement has now been signed and S&P expects a final
agreement to be signed within the next 90 days.

S&P expects to resolve the CreditWatch over the next 90 days or as
soon as the negotiations are complete.  The magnitude of the
rating change will depend upon the terms of the settlement

S&P could raise the ratings by one or several notches if the
settlement is concluded successfully and maps out a route to end
the project's construction phase.  An upgrade would reflect that,
following the dispute's resolution, the relationship between
ProjectCo and the Trust was improving, termination risk had
reduced, and the project was transitioning to its operational
phase.  S&P notes that the timing of an upgrade to reflect the
operations phase stand-alone credit profile (SACP) will depend on
many factors.  These include evidence that all parties can work
constructively together to minimize the risk of future
relationship issues and material penalty deductions.

S&P could assign a negative outlook or lower the ratings if the
settlement negotiations were to break down.  This scenario is
likely to lead to a significant increase in availability and
performance deductions and a heightened chance of project

SANDWELL COMMERCIAL 2: Fitch Hikes Class B Debt Rating to 'BBsf'
Fitch Ratings has upgraded Sandwell Commercial Finance No. 1 plc's
(Sandwell 1) class C notes and Sandwell Commercial Finance No. 2
plc's (Sandwell 2) class A and B notes and affirmed the others, as

Sandwell 1 FRNs due 2039:

GBP12.5 million class C (XS0191372522) upgraded to 'BBBsf' from
'BBsf'; Outlook Stable

GBP10 million class D (XS0191373686) affirmed at 'CCsf'; Recovery
Estimate (RE) 65%

GBP5 million class E (XS0191373926) affirmed at 'Csf'; RE0%

Sandwell 2 FRNs due 2037:

GBP20.3 million class A (XS0229030126) upgraded to 'BBBsf' from
'BBsf'; Outlook Stable

GBP12.6 million class B (XS0229030472) upgraded to 'BBsf' from
'Bsf'; Outlook Stable

GBP11.5 million class C (XS0229030712) affirmed at 'CCCsf'; RE90%
from RE80%

GBP14.5 million class D (XS0229031017) affirmed at 'CCsf'; RE0%

GBP9.4 million class E (XS0229031280) affirmed at 'Csf'; RE0%

The transactions are securitizations of commercial mortgage loans
originated in the UK by West Bromwich Building Society


The upgrades reflect reductions in average loan and senior bond
leverage as a result of continued scheduled amortization applied
sequentially. There are fewer watch-listed loans, and higher than
expected recoveries have been realised on defaulted loans. The
most senior bonds for both transactions now have strong debt
yields in excess of 25%, reflecting considerable protection from
downside risk. While sequential payment mitigates adverse
selection risk for senior investors, both transactions
(particularly Sandwell 1) are now concentrated.

Most properties have been revalued between 2010 and 2015.
Following a market-wide correction in UK secondary quality
property values after 2007, loan-to-value ratios (LTVs) increased
sharply. Since then amortization and completed loan workouts have
reduced the weighted average (WA) LTV in Sandwell 1 to 84.9% from
89.4% and in Sandwell 2 to 87.8% from 91.8%, in both cases since
the last rating actions. With sequential payment, this
deleveraging has been magnified for the senior bonds.

The recovery has been aided by low interest rates, which allow the
servicer time to work out distressed unhedged floating-rate loans.
The WA interest coverage ratio for the Sandwell 1 and 2 portfolios
are 4.26x and 3.59x, respectively, up from 4.15x and 2.77x a year

As of the April/March 2016 reporting cycle, Sandwell 1 had seven
of its 20 remaining loans in various stages of enforcement,
compared with 10 out of 41 in Sandwell 2. Nevertheless, the credit
performance of the Sandwell 2 loans is overall weaker, as
highlighted by the material debit balance on the principal
deficiency ledger (PDL) on its class E notes.

Losses in Sandwell 1 total GBP5.5m and have so far been largely
absorbed by the reserve account, which is now exhausted. However,
in the last 12 months a PDL of GBP333,000 has been applied to the
class E notes. With Sandwell 2's GBP19.8m loan losses, the reserve
fund is also depleted, leaving a GBP8.8m debit balance on the PDL
for the class E bonds. While excess spread can be used to
replenish principal deficiencies, Fitch expects the class D and E
bonds from both issuers to be ultimately written off as more loan
losses are realised.


Given the collateral type and quality, and reporting standards
commensurate with a former granular portfolio profile, Fitch is
unlikely to upgrade the notes above the 'BBBsf' category. Bonds
rated 'CCCsf' or 'CCsf' face the prospect of downgrades unless
recoveries are higher than expected.


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


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

Fitch did not undertake a review of the information provided about
the underlying asset pool ahead of the transaction's initial
closing. The subsequent performance of the transaction over the
years is consistent with the agency's expectations given the
operating environment and Fitch is therefore satisfied that the
asset pool information relied upon for its initial rating analysis
was adequately reliable.

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


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

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

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


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

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

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