TCREUR_Public/170210.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Friday, February 10, 2017, Vol. 18, No. 30



BANKA SRPSKE: Serbia's Banking Agency Files Bankruptcy Request


KMB BULGARIA: Declared Bankrupt by Sofia Court


HORIZON HOLDINGS: S&P Affirms 'B' CCR on New PIK Issuance


EIRCOM HOLDINGS: Fitch Raises IDR to B+, Outlook Stable


MERCURY BONDCO: Moody's Assigns (P)B3 Rating to EUR600MM Notes


CAIRN CLO VII: Moody's Assigns B2 Rating to Class F Notes
CAIRN CLO VII: Fitch Assigns B- Rating to EUR9.1MM Class F Notes
ZOO ABS II: S&P Raises Rating on Class C Notes to BB+


COMMERCIAL BANK: S&P Puts 'B/B' Ratings on Watch Negative
ENISEY JSCB: Put on Provisional Administration, License Revoked


TURKIYE IS BANKASI: Fitch Maintains Stable Outlook on DPR


PRIVATBANK: Central Bank Won't Change Stance on Bail-in

U N I T E D   K I N G D O M

BANK OF IRELAND: Moody's Raises LT Deposit Rating from Ba1
MARRACHE & CO: Liquidators Begin Legal Action Against Jyske
RANGERS FOOTBALL: Liquidators Sue Former Administrators

* UK Buy-to-Let RMBS 90-plus Days Delinquencies Slightly Down


* BOOK REVIEW: Hospitals, Health and People



BANKA SRPSKE: Serbia's Banking Agency Files Bankruptcy Request
SeeNews reports that the Banking Agency of Bosnia's Serb Republic
has filed for the bankruptcy of local lender Banka Srpske, which
was earlier placed in liquidation.

According to SeeNews, news portal quoted the bank's
liquidation administrator Petar Micic as saying on Feb. 6 the
Banking Agency decided to submit a bankruptcy request to the
competent court because Banka Srpske is insolvent and the
liquidation process cannot be implemented in a way that would
protect the interests of creditors.

In August 2015, local media reported that an audit at Banka
Srpske found a loss of at least BAM17 million (US$9.3
million/EUR.7 million) in 2014 instead of the stated profit of
BAM298,00, SeeNews relates.  Banka Srpske is 99.95% owned by the
Serb Republic government, SeeNews discloses.

Also in 2015, the Serb Republic's president said the government
was in the final phase of negotiating the sale of 74% Banka
Srpske to an unnamed foreign financial organization, SeeNews
recounts.  However, in November 2015 the Banking Agency of the
Serb Republic appointed an interim administration at the bank,
before a liquidation procedure was announced in May last year,
SeeNews relays.


KMB BULGARIA: Declared Bankrupt by Sofia Court
SeeNews reports that the Sofia Regional Court has declared KMB
Bulgaria, the local operator of Carrefour supermarket chain,
bankrupt as of October 31, 2016, according to the country's
commercial registry.

The court took its decision on Jan. 23 based on a bankruptcy
request filed by Sofia-based ENKO 2013, SeeNews relates.  KMB
Bulgaria has accumulated BGN183 million (US$100 million/EUR93.5
million) in losses since 2011, which cannot be covered by its
capital reserves, the court states in its decision, SeeNews

According to SeeNews, the court decision shows KMB Bulgaria has
an outstanding liability to Greece's Alpha Bank, amounting to
EUR17.5 million.  A debt of BGN6.6 million is owed to Bulgaria's
National Revenue Agency, SeeNews states.


HORIZON HOLDINGS: S&P Affirms 'B' CCR on New PIK Issuance
S&P Global Ratings said that it affirmed its 'B' long-term
corporate credit rating on Horizon Holdings I S.A.S., the France-
based financial holding company for glass packaging manufacturer
Verallia.  S&P also affirmed the 'B' long-term corporate credit
rating on Verallia's finance subsidiary, Verallia Packaging

At the same time, S&P assigned its 'B' long-term corporate credit
rating to finance holding company Horizon Parent Holdings
S.a.r.l. The outlook on all three companies is stable.

S&P is assigning its 'CCC+' issue rating to the proposed EUR350
million payment-in-kind (PIK) toggle notes due in 2022, to be
issued by Horizon Parent Holdings.  The issue rating is two
notches below the corporate credit rating on the consolidated
group, reflecting S&P's recovery rating of '6' and its
expectation of negligible recovery (0%-10%) for the holders of
the new subordinated PIK toggle notes in the event of a payment

At the same time, S&P is affirming the 'B' issue ratings on the
existing EUR500 million senior secured notes, EUR250 million
senior secured revolving credit facility (RCF), and EUR1,375
million term B loan issued by Verallia Packaging, in line with
the corporate credit rating.  S&P's '3' recovery ratings remain
unchanged, reflecting its expectation of meaningful recovery in
the upper half of the 50%-70% range for the secured lenders in
the event of a payment default.  Furthermore, S&P is affirming
the 'CCC+' issue rating on the EUR225 million senior unsecured
notes issued by Horizon Holdings I.  The issue rating is two
notches below the corporate credit rating on the consolidated
group, reflecting S&P's expectation of negligible recovery (0%-
10%) for the holders of the unsecured notes in the event of a
payment default.

The affirmation follows Verallia's announcement that it intends
to raise EUR350 million of PIK toggle notes.  The proceeds are to
be used to fund a EUR280 million distribution to shareholders,
and EUR60 million cash overfunding with Bpifrance, the minority
shareholder, re-investing their proceeds into the issuer of the
PIK notes.  The transaction is completing a EUR230 million
initial distribution started last summer, when the financial
sponsor Apollo tapped the secured notes to fund an early
distribution. With this transaction, Apollo's initial equity
investment will have been largely repaid, just over a year after
it took control of Verallia from Compagnie de Saint-Gobain.

The transaction is similar to that attempted in October 2016,
which was subsequently cancelled, albeit now with reduced
issuance of EUR350 million, as opposed to EUR500 million.  S&P
views the transaction as illustrative of the financial sponsor's
aggressive financial policies, although the deterioration in
credit metrics for the consolidated group is less material, with
adjusted leverage expected to increase to around 6.2x from S&P's
previous expectations of less than 5.5x. In addition, although
the new PIK notes are outside of the restricted group and
subordinated to the existing debt, S&P views them as bearing a
risk of change of control should the sponsor fail to repay or
refinance these instruments, given their shorter maturity than
the restricted group debt and share pledges over Verallia's

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

   -- Eurozone GDP growth of 1.4% in 2017 and around 1.3% in
      2018, with Latin American growth around 2.0% and 2.7%.
   -- Group revenue growth of 0%-2% in 2017 and 2018, closely
      tracking GDP growth in Europe with moderately positive
      organic volume developments, while predominantly driven by
      inflation in Latin America.
   -- Improving margins as a result of cost-reduction measures
      and operating leverage through higher capacity utilization,
      resulting in the S&P Global Ratings-adjusted EBITDA margin
      improving to about 18%-19% over the next two years, up from
      about 17.5% (on a comparable basis) in 2015.
   -- Capital expenditures (capex) of about EUR200 million per
   -- S&P has not factored into its base case the improvements to
      EBITDA from Verallia's planned change in accounting policy
      to capitalize mould costs, although S&P would expect to
      incorporate any adjustment signed off by auditors in future

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

   -- Debt to EBITDA of around 6.3x for 2017, which S&P forecasts
      will trend downward to around 6.0x over the next couple of
      years, owing to increased EBITDA generation.  This compares
       with S&P's previous forecasts of 5.2x-5.5x;
   -- Relatively stable funds from operations (FFO) to debt of
      8.5%-9.0%, down from 11%-12% previously;
   -- Negative discretionary cash flow generation in 2017 owing
      to the debt-funded shareholder returns, but this is likely
      to turn positive in 2018, despite S&P's expectation that
      capex will remain sizable; and
   -- EBITDA and FFO cash interest coverage to remain sound at

The stable outlook reflects S&P's view that credit metrics will
likely remain highly leveraged, with the owners' financial policy
limiting the likelihood of any sustained deleveraging.  The
current rating factors in the risk of a moderate increase in
leverage.  S&P expects operating performance to remain solid,
with limited volume growth and rational pricing, while margins
should increase through Verallia's internal operational
improvement program, and anticipate that this could result in
gradually improving credit metrics over the coming 12-24 months.

The ratings factor in the risk that the group's relatively
aggressive financial policies could result in a further weakening
of credit metrics as a result of additional large debt-funded
acquisitions or additional shareholder returns, and therefore S&P
sees a further lowering of the rating in the next 12 months as
unlikely.  A downgrade could, however, stem from a significant
shortfall in operating performance compared with S&P's base case.
This could occur as a result of furnace outages or operational
failures caused by technical defects, such that earnings and cash
flow generation lead to weaker liquidity or FFO cash interest
coverage falling below 1.5x.

S&P believes that the likelihood of an upgrade is limited at this
stage, because of Verallia's high tolerance for relatively
aggressive financial policies and high leverage given its
financial sponsor ownership.  An upgrade is therefore more likely
to be driven by an upward reassessment of the company's business
risk profile, although S&P do not anticipate such an action in
the short term.  This could result from a sustained improvement
in profitability metrics, including return on capital over 13%,
track record of meaningful positive cash flow generation, and low
earnings volatility.


EIRCOM HOLDINGS: Fitch Raises IDR to B+, Outlook Stable
Fitch Ratings has upgraded Ireland-based eircom Holdings
(Ireland) Limited's Long-Term Issuer Default Rating (IDR) to 'B+'
from 'B'. The Outlook on the IDR is Stable. Fitch has
simultaneously upgraded eir's senior secured ratings to 'BB-
'/Recovery Rating 'RR3' from 'B+'/'RR3'. A full list of rating
actions is available at the end of this commentary.

The upgrade reflects eir's improved operational performance and
free cash flow (FCF) generation leading to lower leverage as eir
continues its successful business transformation. FCF should
improve further over the medium-term even with stable capex as
EBITDA continues to grow and cash restructuring costs fall,
resulting in a deleveraging profile.

Improving Competitive Position: In spite of a competitive retail
market, eir is able to defend its market position. Recent content
acquisitions have enhanced the company's converged fixed and
mobile offering. Combined with a new corporate brand and an
increased focus on improving customer experience, this should
continue to reduce broadband churn and help curtail retail access
line losses.

Increasing Multi-Play Penetration: eir has been able to increase
multi-play penetration of its customer base to 23% at end-
December 2016, with its high-speed broadband offering, third-
placed mobile position (20% handset subscriber market share) and
a small but growing pay-TV position. Increased focus on content
and bundling is crucial in competing against strong
multinationals such as Virgin Media, Vodafone and Sky.

Fibre and 4G Network Investment: eir has invested heavily in its
fibre network rollout and LTE deployment (now at 95% population
coverage) over the past few years to become Ireland's leading
fibre and fixed-mobile converged network. The company's fibre
network at end-2016 passed 1.6 million premises (68% of Irish
premises) and connected 31% of customers, and is on track to pass
1.9 million premises by end-2018.

This network investment has underpinned the introduction of
higher value customer bundles, which has led to underlying year-
on-year revenue growth of 3.2% for 2Q of the financial year
ending June 2017 in eir's consumer segment. Twenty-three per cent
of eir's fixed line consumer customers are taking either a
triple- or quad-play bundle of services (fixed voice, broadband,
TV and/or mobile), while 42% of eir's consumer mobile customers
are on a post-pay contract.

National Broadband Plan Win Possible: eir is participating in a
bidding process for the government's national broadband plan,
which would see high-speed broadband deployed to approximately
927,000 premises (the current intervention footprint as of July
2016) in the rural part of Ireland. Fitch expects eir to win the
bidding for one of the two regions, which is likely to keep capex
at around current levels over the medium-term.

This is a complex project and Fitch expects the government to
announce contract awards towards end-2017. The government is
still considering how eir's current plans to roll out its fibre-
to-the-home network to approximately 300,000 rural premises may
affect the proposed area covered by the government's intervention

Regulatory Changes: eir's FY17 mobile revenue is going to be
negatively impacted by a decrease in mobile termination rates but
the impact on group EBITDA is going to be neutral. The reduction
in analogue wholesale line rental prices from 1 July 2016 should
be partially offset by the increase in next generation access (ie
fibre) bitstream wholesale prices from 1 September 2016. Fitch
believes this gives eir a higher return on its fibre investment
when its competitors use its network, and should reduce the
intensity of retail fibre price competition.

Improving EBITDA: eir's underlying revenue and EBITDA increased
2% year-on-year in 1HFY17. Reported revenue growth for the same
period was 1%, including mobile termination rate declines and the
FX impact from a small GBP exposure. eir's efficiency programme
focusing on product simplification and rationalisation continues
to support profitability with EBITDA margin improving 0.7pp in
1HFY17. Fitch expects EBITDA to grow slightly over the medium-
term, with EBITDA margin stabilising at 39%.

Growing FCF Generation: Even though Fitch expects capex to remain
stable with further fibre investment, FCF generation should
improve as cash restructuring costs decline over time. As the
restructuring costs normalise and become part of ongoing
operations, these will not be treated as one-off items in Fitch
calculations of eir's credit metrics. eir also benefits from
significant reduction in interest cost following the company's
bond refinancing, and the repricing of its senior credit facility
in October 2016.

We expect eir's FCF margin over the medium-term to be around the
mid-single digit range, leading to funds from operations (FFO)-
adjusted net leverage trending towards 4.5x. Fitch believes eir's
management is committed to reducing leverage, having previously
explored the potential of a public listing, and having made a
EUR52 million voluntary debt repayment in 1HFY17.

Relative to its European telecoms incumbent peers, eir has higher
leverage, a smaller size, a largely domestic focus, and the lack
of leadership in the mobile segment. Its EBITDA margin is similar
to its peers, but pre-dividend FCF margin is lower, mainly due to
higher capex as a percentage of revenue and cash restructuring
costs. No parent/subsidiary linkage or Country Ceiling constraint
is applicable.

Fitch's key assumptions within the rating case for eir include
the following:
- Low single-digit revenue growth through to FY19;
- Stable EBITDA margin of around 39% from FY17 to FY19;
- Cash tax of around EUR20 million p.a. from FY18;
- Cash outflows related to restructuring provisions and onerous
contracts around EUR40 million in FY17 and decreasing thereafter;
- Capex at 22% of revenues in FY17 and FY18, reducing to 21% in
the following two years;
- No material M&A

Positive: Future developments that may collectively lead to an
upgrade include:-
- FFO adjusted net leverage expected to remain at or below 4.5x
on a sustained basis;
- FCF margin expected to be consistently in the mid-single digit
range, with ongoing revenue stability and EBITDA improvement;
- Strengthened operating profile and competitive capability
demonstrated by stable fixed broadband market share with
increasing fibre penetration and mobile market share;

Negative: Future developments that may, individually or
collectively, lead to a downgrade include:-
-FFO adjusted net leverage above 5.0x on a sustained basis;
-Weaker cashflow generation with FCF margin expected to remain
in the low single digit percentages, driven by lower EBITDA or
higher capex;
-Deterioration in the regulatory or competitive environment
leading to a material reversal in positive operating trends.

Strong Liquidity: eir had an undrawn EUR150 million revolving
credit facility (expires 2021) and EUR105 million in cash at end-
2016. The company's growing FCF adds to the company's strong
liquidity position. eir's senior secured notes and credit
facility are due in 2022.


eircom Holdings (Ireland) Limited
- Long-Term IDR upgraded to 'B+' from 'B'; Outlook Stable
eircom Finance Designated Activity Company
- Senior secured rating: upgraded to 'BB-'/'RR3' from 'B+'/RR3
eircom Finco S.a.r.l
-- Senior secured rating: upgraded to 'BB-'/'RR3' from 'B+'/RR3


MERCURY BONDCO: Moody's Assigns (P)B3 Rating to EUR600MM Notes
Moody's Investors Service has assigned a provisional (P)B3 rating
to the new guaranteed EUR600 million Senior Secured PIK Fixed
Rate Toggle Notes due 2021 (the New Notes) to be issued by
Mercury BondCo Plc (Mercury BondCo). Moody's has also affirmed
the B3 instrument rating on the outstanding EUR900 million Senior
Secured Fixed Rate PIK Toggle Notes due 2021 and the EUR200
million Senior Secured Floating Rate PIK Toggle Notes due 2021
issued by Mercury BondCo. Concurrently, Moody's has changed the
outlook on these notes to negative from stable.

Moody's has also affirmed Istituto Centrale delle Banche Popolari
Italiane S.p.A.'s (ICBPI) corporate family rating (CFR) of Ba2,
with a stable outlook.

Moody's issues provisional ratings in advance of the final sale
of securities and these ratings reflect Moody's preliminary
credit opinion regarding the transaction only. Upon a conclusive
review of the final documentation, Moody's will endeavour to
assign a definitive rating to the notes. A definitive rating may
differ from a provisional rating.

The proceeds from the issuance of the New Notes, except for EUR34
million to be retained at Mercury BondCo as cash overfund,
alongside EUR139 million of excess capital from ICBPI will be
used by ICBPI to fund: (1) the acquisition of the merchant
acquiring business of Banca Monte dei Paschi di Siena S.p.A. (MPS
Acquiring); (2) the acquisition of at least 92% of the capital
stock in Bassilichi S.p.A. (Bassilichi Payments), a company
mainly managing point-of-sale (POS) terminals; (3) the
acquisition of the merchant acquiring business of Deutsche Bank
S.p.A. (DB Cards Acquiring); and (4) transaction fees.


Mercury BondCo

The rating affirmation and change in outlook to negative reflects
increased adjusted leverage, calculated with the debt issued by
Mercury BondCo and the EBITDA generated by the operating
subsidiaries of Mercury HoldCo, the parent of ICBPI and Mercury
Processing Internationale, as a result of the debt raised to
finance the new acquisitions. Pro-forma adjusted gross leverage
(pro-forma for the issuance of the new notes and the acquisition
of MPS Acquiring, Bassilichi Payments, and DB Cards Acquiring and
adjusted by Moody's for pension liabilities and certain non-
recurring items but prior to anticipated synergies) will increase
to 7.3x (or 6.6x excluding restructuring charges, which amounted
to c.EUR34 million in the last twelve months (LTM) to 30
September 2016) from 6.2x as of 30 September 2016. Moody's
expects that adjusted leverage will remain elevated at or above
6.5x over the next 24 months, as growth in EBITDA, mainly driven
by growth of ICBPI's co-issuing and merchant acquiring activities
and revenue and cost synergies generated from the integration of
the acquired entities will be partly absorbed by significant
integration/restructuring charges.

The rating action also reflects the weaker pro-forma interest
coverage (as measured by the cover of Mercury BondCo's annual
interest expense by dividends from Mercury HoldCo's operating
subsidiaries) compared with that projected at the closing of the
acquisition of ICBPI by its current shareholders in late 2015.
Moody's projects that net income generated by Mercury HoldCo's
operating subsidiaries will be complemented by the cash overfund
at Mercury BondCo to reach pro forma interest coverage of around
1x for the next 24 months. This compares unfavourably with
Moody's prior assumption at the closing of the acquisition of
ICBPI that this ratio would trend towards 1.5x by the end of this
period. As a significant portion of ICBPI's excess capital will
be used to fund part of the consideration for MPS Acquiring,
Bassilichi Payments, and DB Cards Acquiring, its capital headroom
relative to prudential guidance will decrease to EUR43 million on
a pro forma basis vs. EUR231 million as reported as of end of Q3
2016 and thus reduce the excess liquidity that could have been
used to support Mercury BondCo's obligations.

The New Notes are rated (P)B3, at the same level as the existing
notes and are rated below the CFR, reflecting their structural
subordination to any debt and non-debt liabilities at ICBPI, with
the latter being subject to regulatory requirements constraining
its capacity to upstream dividends. This differential in ratings
between the bonds and the CFR is four notches, reflecting the
high leverage and weak interest cover metrics.

Moody's notes that the probability of default is, however,
limited until the maturity of the bonds thanks to: (1) the PIK
toggle nature of notes, i.e. the interest can be accrued at the
option of the issuer of these notes; (2) the EUR34 million cash
overfunding at Mercury BondCo at the closing of the transaction;
and (3) the EUR100 million revolving credit facility (RCF) at
Mercury BondCo available for interest payments. However, the
rating agency notes that whilst the PIK toggle feature provides
additional flexibility, any use of it will result in increased
leverage; and in a scenario of default, Moody's considers that
the bondholders' ability to exercise their rights under the
existing share pledge would likely, in practice, be constrained
by the need to obtain regulatory approval to new shareholders.

The negative outlook incorporates Moody's view that for the next
24 months Mercury BondCo will operate at adjusted gross leverage
and interest coverage levels outside of or at the lower end of
the range that the rating agency would expect for a B3-rated
instrument. During this period, net income will be constrained as
the businesses will undergo an extensive restructuring and
integration program, implying significant charges.


The affirmation of ICBPI's corporate family rating at Ba2 with a
stable outlook reflects the operating company's: (1) strengthened
position across the payment value chain, although with limited
contribution of net income from its acquisitions; (2) performance
underpinned by favourable market trends; and (3) good liquidity.
These strengths are offset by significant customer concentration
and the leveraged nature of the group.

Moody's views positively ICBPI's increased size in an industry
driven by economies of scale and its greater exposure to the
fast-growing merchant acquiring segment provided by the
acquisitions of MPS Acquiring, DB Cards Acquiring and Bassilichi
Pauments, but notes that Bassilichi Payments will provide limited
contribution in terms of net income due to significant
restructuring costs.

In the first nine months of 2016, EBITDA (as reported by the
company) increased by 11% to EUR169 million. Moody's believes
that growth prospects are good, supported by increasing card
penetration in Italy, growth in e-commerce and government actions
to facilitate a switch away from cash.

Moody's notes that ICBPI has a structural excess of liquidity,
with deposits from securities services of EUR4.5 billion as of
September 2016 funding the card business by EUR1.2 billion and
the remainder primarily invested in a large Italian government
bond portfolio of EUR2.7 billion.

However, constraints on the rating include significant customer
concentration, with the top 10 banking customers accounting for
61% of managed cards. The acquisitions will reduce this
concentration, adding about 100,000 direct relationships with
merchants, largely small and medium-sized enterprises (SMEs).

Additionally, ICBPI's financial flexibility is reduced by the
need to upstream net income to service interest payment on the
acquisition debt. Nonetheless, Moody's believes that ICBPI's
credit profile will continue to benefit from its status as a
regulated bank. Moody's expects the common equity Tier 1 (CET1)
ratio, which was 15% at 30 September 2016, pro-forma for the new
acquisitions, to remain above the prudential minimum of 14% for
the distribution of dividends. Moody's therefore considers that
regulatory supervision continues to mitigate the risk of an
overly aggressive financial policy by protecting ICBPI's own
credit profile.


Mercury BondCo

Moody's could change the outlook on the ratings to stable if
adjusted leverage decreases below 6.5x and interest coverage by
dividends is sustained at a level well above 1x. Conversely,
Moody's could lower the ratings if (1) the company is not able to
reduce leverage to below 6.5x due to a softening of operating
activities and/or higher costs related to the integration and
restructuring plans; or (2) interest coverage by dividends
remains below 1x.


Moody's could upgrade the ratings if ICBPI (1) demonstrates
significant progress in the delivery of the integration and
restructuring plan, such that EBITDA increases significantly as
integration and restructuring charges are phased out; (2)
experiences sustainable and significant organic revenue growth
with high renewal rate for both merchant and institutional client
contracts; and (3) improves the diversification of the deposit
pool for its securities business.

Conversely, Moody's could downgrade the rating if (1) the company
loses large customer contracts or sees increased churn in
merchant acquiring due to increased competition; or (2) deposits
decline materially.

Mercury BondCo is a financing vehicle set up in 2015 to raise
debt to support the acquisition of ICBPI by Advent International,
Bain Capital and Clessidra. ICBPI is the leading operator in the
Italian card issuing, acquiring, payments and securities services
areas, providing a large range of services to financial
institutions and corporates. The company holds a banking license
from the Bank of Italy reflective of its settlement and
depositary activities. ICBPI generated net revenues and EBITDA
(as reported by the company) of EUR508 million and EUR169
million, respectively, in the first nine months ending 30
September 2016.


The principal methodology used in these ratings was Finance
Companies published in December 2016.


CAIRN CLO VII: Moody's Assigns B2 Rating to Class F Notes
Moody's Investors Service announced that it has assigned the
following definitive ratings to notes issued by Cairn CLO VII

-- EUR203,900,000 Class A-1 Senior Secured Floating Rate Notes
due 2030, Assigned Aaa (sf)

-- EUR10,000,000 Class A-2 Senior Secured Fixed Rate Notes due
2030, Assigned Aaa (sf)

-- EUR40,800,000 Class B Senior Secured Floating Rate Notes due
2030, Assigned Aa2 (sf)

-- EUR19,700,000 Class C Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned A2 (sf)

-- EUR17,900,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned Baa2 (sf)

-- EUR22,400,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned Ba2 (sf)

-- EUR9,100,000 Class F Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned B2 (sf)


Moody's definitive rating of the rated notes addresses the
expected loss posed to noteholders by the legal final maturity of
the notes in 2030. The definitive ratings reflect the risks due
to defaults on the underlying portfolio of loans given the
characteristics and eligibility criteria of the constituent
assets, the relevant portfolio tests and covenants as well as the
transaction's capital and legal structure. Furthermore, Moody's
is of the opinion that the collateral manager, Cairn Loan
Investments LLP ("Cairn Loan Investments"), has sufficient
experience and operational capacity and is capable of managing
this CLO.

Cairn CLO VII B.V. is a managed cash flow CLO. At least 90% of
the portfolio must consist of senior secured loans and senior
secured bonds and up to 10% of the portfolio may consist of
unsecured obligations, second-lien loans, mezzanine loans and
high yield bonds. The bond bucket gives the flexibility to Cairn
CLO VII B.V. to hold bonds if Volcker Rule is changed. The
portfolio is expected to be approximately 60-70% ramped up as of
the closing date and to be comprised predominantly of corporate
loans to obligors domiciled in Western Europe.

Cairn Loan Investments will manage the CLO. It will direct the
selection, acquisition and disposition of collateral on behalf of
the Issuer and may engage in trading activity, including
discretionary trading, during the transaction's four-year
reinvestment period. Thereafter, purchases are permitted using
principal proceeds from unscheduled principal payments and
proceeds from sales of credit risk and credit improved
obligations, and are subject to certain restrictions.

In addition to the seven classes of notes rated by Moody's, the
Issuer issued EUR 17.65m of subordinated M-1 notes and EUR 21.12m
of subordinated M-2 notes, which are not rated.

The transaction incorporates interest and par coverage tests
which, if triggered, divert interest and principal proceeds to
pay down the notes in order of seniority.

Factors that would lead to an upgrade or downgrade of the

The rated notes' performance is subject to uncertainty. The
notes' performance is sensitive to the performance of the
underlying portfolio, which in turn depends on economic and
credit conditions that may change. Cairn Loan Investments'
investment decisions and management of the transaction will also
affect the notes' performance.

Loss and Cash Flow Analysis:

Moody's modeled the transaction using CDOEdge, a cash flow model
based on the Binomial Expansion Technique, as described in
Section 2.3 of the "Moody's Global Approach to Rating
Collateralized Loan Obligations" rating methodology published in
October 2016. The cash flow model evaluates all default scenarios
that are then weighted considering the probabilities of the
binomial distribution assumed for the portfolio default rate. In
each default 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 default
scenario and (ii) the loss derived from the cash flow model in
each default scenario for each tranche. As such, Moody's
encompasses the assessment of stressed scenarios.

Moody's used the following base-case modeling assumptions:

Par amount: EUR 350,000,000

Diversity Score: 36

Weighted Average Rating Factor (WARF): 2850

Weighted Average Spread (WAS): 4.00%

Weighted Average Recovery Rate (WARR): 43%

Weighted Average Life (WAL): 8 years.

Moody's has analysed the potential impact associated with
sovereign related risk of peripheral European countries. As part
of the base case, Moody's has addressed the potential exposure to
obligors domiciled in countries with local currency country risk
ceiling of A1 or below. Following the effective date, and given
the portfolio constraints and the current sovereign ratings in
Europe, such exposure may not exceed 10% of the total portfolio.
As a result and in conjunction with the current foreign
government bond ratings of the eligible countries, as a worst
case scenario, a maximum 10% of the pool would be domiciled in
countries with A3. The remainder of the pool will be domiciled in
countries which currently have a local or foreign currency
country ceiling of Aaa or Aa1 to Aa3.

Stress Scenarios:

Together with the set of modeling assumptions above, Moody's
conducted additional sensitivity analysis, which was an important
component in determining the definitive rating assigned to the
rated notes. This sensitivity analysis includes increased default
probability relative to the base case. Below is a summary of the
impact of an increase in default probability (expressed in terms
of WARF level) on each of the rated notes (shown in terms of the
number of notch difference versus the current model output,
whereby a negative difference corresponds to higher expected
losses), holding all other factors equal.

Percentage Change in WARF: WARF + 15% (to 3278 from 2850)

Ratings Impact in Rating Notches:

Class A-1 Senior Secured Floating Rate Notes: 0

Class A-2 Senior Secured Fixed Rate Notes: 0

Class B Senior Secured Floating Rate Notes: -2

Class C Senior Secured Deferrable Floating Rate Notes: -2

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: 0

Percentage Change in WARF: WARF +30% (to 3705 from 2850)

Ratings Impact in Rating Notches:

Class A-1 Senior Secured Floating Rate Notes: -1

Class A-2 Senior Secured Fixed Rate Notes: -1

Class B Senior Secured Floating Rate Notes: -4

Class C Senior Secured Deferrable Floating Rate Notes: -4

Class D Senior Secured Deferrable Floating Rate Notes: -3

Class E Senior Secured Deferrable Floating Rate Notes: -2

Class F Senior Secured Deferrable Floating Rate Notes: -2

Further details regarding Moody's analysis of this transaction
may be found in the upcoming new issue report, available soon on

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in October 2016.

CAIRN CLO VII: Fitch Assigns B- Rating to EUR9.1MM Class F Notes
Fitch Ratings has assigned Cairn CLO VII B.V.'s notes final
ratings, as follows:

EUR203.9m Class A-1: 'AAAsf'; Outlook Stable
EUR10m Class A-2: 'AAAsf'; Outlook Stable
EUR40.8m Class B: 'AAsf'; Outlook Stable
EUR19.7m Class C: 'Asf'; Outlook Stable
EUR17.9m Class D: 'BBBsf'; Outlook Stable
EUR22.4m Class E: 'BBsf'; Outlook Stable
EUR9.1m Class F: 'B-sf'; Outlook Stable
EUR17.65m Class M-1 Sub: unrated
EUR21.12m Class M-2 Sub: unrated

Cairn CLO VII B.V. (the issuer) is a cash flow collateralised
loan obligation (CLO). Net proceeds from the issuance of the
notes were used to purchase a EUR350m portfolio of mostly
European leveraged loans and bonds. The portfolio is managed by
Cairn Loan Investments LLP. The transaction includes a four-year
reinvestment period.

'B' Portfolio Credit Quality
Fitch expects the average credit quality of obligors to be in the
'B' range. Fitch has public ratings or credit opinions on 69 of
the 70 assets in the identified portfolio. The Fitch weighted
average rating factor of the identified portfolio is 32.2, below
the pricing point maximum covenant of 33.29.

High Recovery Expectations
At least 90% of the portfolio will comprise senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. Fitch has assigned Recovery Ratings (RRs) to 69 of the 70
assets in the identified portfolio. The Fitch weighted average
recovery rate of the identified portfolio is 67.0%, above the
pricing point minimum covenant of 66%.

Limits Set For Obligor Concentration
The transaction contains three Fitch test matrices based on the
concentration of the top 10 obligors. The manager can choose
between a matrix with no limit on the top 10 obligors, a
limitation of 23% or a limitation of 20%. In this way the manager
can reduce the minimum weighted average recovery rate required by
moving to the same weighted average rating factor and weighted
average spread point in a matrix with a reduced top 10 obligor
concentration. The combination of covenant thresholds can be
changed by the asset manager at any time provided the collateral
quality tests are satisfied at their new thresholds.

Limited Interest Rate Risk Exposure
Between 0% and 5% of the portfolio can be invested in fixed-rate
assets while fixed rate liabilities represented 3.1% of the rated
note balance at origination. Fitch modelled both 0% and 5% fixed-
rate buckets and found that the rated notes can withstand the
interest rate mismatch associated with each scenario.

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

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

Based on the pricing point a 25% increase in the obligor default
probability would lead to a downgrade of up to two notches for
the rated notes. A 25% reduction in expected recovery rates would
lead to a downgrade of up to three notches for the rated notes.

ZOO ABS II: S&P Raises Rating on Class C Notes to BB+
S&P Global Ratings raised its credit ratings on ZOO ABS II B.V.'s
class A-2, B, and C notes.  At the same time, S&P has affirmed
its ratings on the class A-1, D, and E notes.

The rating actions follow S&P's assessment of the transaction's
performance, using data from the Dec. 15, 2016 trustee report and
applying S&P's relevant criteria.

Since S&P's March 3, 2016, review of the transaction, the
portfolio's average credit quality and weight-average spread have
remained consistent at 'BB+' and 1.39%, respectively.  In terms
of the portfolio's composition, residential mortgage-backed
securities (RMBS) comprise 81.5% of the portfolio balance, while
corporate collateralized debt obligations (CDOs) make up 10.1%.
The portfolio's largest country exposure is to Italy (65.5%).

The available credit enhancement has increased for all of the
rated notes, except the class E notes, due to the senior notes'
structural deleveraging.  The class A-1 notes have received
principal paydowns of EUR25.53 million since our previous review
and have a note factor (the current notional amount divided by
the notional amount at closing) of 9.35%.  The upgrades of the
class A-2, B, and C notes reflect the increased credit

All overcollateralization tests currently comply with the
required levels under the transaction documents.  At S&P's
previous review, the class E par value test did not comply with
the required levels.

As the transaction continues to deleverage, the weighted-average
cost of the liabilities is increasing as the relatively less
expensive senior notes are repaid.  As a result, interest
proceeds received from the collateral are not sufficient to pay
interest due on the more expensive junior class E notes, which
have begun to defer interest (currently EUR39,000 of unpaid
interest outstanding).  Consequently, the class D and E interest
coverage tests are now failing, with the class E interest
coverage ratio of 40.37% significantly below the trigger level of
101.5% and the class D ratio at 73.97% compared to a trigger
level of 104.00%.  As long as the class D interest coverage test
remains out of compliance, the class E notes will continue to
capitalize interest and will only be fully repaid if principal
proceeds are sufficient to pay the deferred interest following
repayment of all notes senior to the class E.

Obligor concentration in the portfolio has increased due to
portfolio deleveraging, with 26 performing distinct obligors,
down from 39 in S&P's previous review.  The proportion of assets
that S&P considers to be rated in the 'CCC' category ('CCC+',
'CCC', or 'CCC-') has increased on a notional and proportional
basis since S&P's previous review.  Of the five assets in the
'CCC' rating bucket at S&P's previous review, two have been
either redeemed or sold, two have migrated to the default bucket
(assets rated 'CC', 'C', 'SD' [selective default], and 'D'), and
one remains.  In addition to this remaining asset, two other
assets have migrated into the bucket since S&P's previous review.
The notional of the bucket has therefore risen to EUR8.0 million
from EUR5.1 million. As a result of these two assets migrating to
the default bucket from the 'CCC' bucket, the notional balance of
defaults in the transaction has increased to EUR13.4 million from
EUR10.3 million.

S&P subjected the capital structure to a cash flow analysis to
determine the break-even default rate (BDR) for each rated class
at each rating level.  The BDR represents S&P's estimate of the
maximum level of gross defaults, based on its stress assumptions,
that a tranche can withstand and still fully repay the
noteholders.  In S&P's analysis, it used the portfolio balance
that it considers to be performing (EUR74 million), the current
weighted-average spread (1.39%), and the weighted-average
recovery rates calculated in line with S&P's criteria.  S&P
applied various cash flow stresses, using its standard default
patterns, in conjunction with different interest rate stress

The increase in available credit enhancement for the class A-2,
B, and C notes has resulted in each class of notes achieving
higher ratings in S&P's cash flow analysis.  The results of S&P's
cash flow analysis indicate that these classes of notes are able
to sustain defaults at higher rating levels than those currently
assigned.  S&P has therefore raised its ratings on the class A-2,
B, and C notes.  At the same time, S&P has affirmed its 'A (sf)'
rating on the class A-1 notes, S&P's 'CCC (sf)' rating on the
class D notes, and 'CCC- (sf)' rating on the class E notes as the
available credit enhancement is commensurate with the currently
assigned ratings.

In line with S&P's structured finance ratings above the sovereign
criteria, it applied a sovereign stress to any exposure in
countries above S&P's pre-defined thresholds.  Due to excessive
Italian exposure (65.5% of the asset pool), S&P applied a
sovereign stress to 50.51% (total exposure minus our 15%
threshold) of assets in rating scenarios 'A+' and above (four
notches above the long-term sovereign rating on Italy).  As a
result, despite the deleveraging, the class A-1 notes' available
credit enhancement is not commensurate with a higher rating than
that currently assigned, and significant credit enhancement
growth would be required for any of the rated notes to be rated
'A (sf)'.  S&P would therefore expect a clustering of the rated
notes at this rating level should portfolio default rates remain

According to S&P's analysis, the portion of performing assets not
rated by S&P Global Ratings is 4.3%.  In this case, S&P applies
its third-party mapping criteria to map notched ratings from
another ratings agency and to infer S&P's rating input for the
purpose of inclusion in CDO Evaluator.  In performing this
mapping, S&P generally applies a three-notch downward adjustment
for structured finance assets that are rated by one rating agency
and a two-notch downward adjustment if the asset is rated by two
rating agencies.

ZOO ABS II is a cash flow CDO of asset-backed securities (ABS)
transaction that securitizes structured finance securities,
mostly RMBS and CDOs.  The transaction closed in December 2005
and is managed by P&G SGR SpA.


Class               Rating
            To                From

EUR255.5 Million Senior Delayed Drawdown and Deferrable-Interest
Secured Floating-Rate Notes

Ratings Raised

A-2         A- (sf)           BBB- (sf)
B           BBB+ (sf)         BB (sf)
C           BB+ (sf)          BB- (sf)

Ratings Affirmed

A-1         A (sf)
D           CCC (sf)
E           CCC- (sf)


COMMERCIAL BANK: S&P Puts 'B/B' Ratings on Watch Negative
S&P Global Ratings placed its 'B/B' long- and short-term
counterparty credit ratings and 'ruBBB+' Russia national scale
rating on Russia-based Commercial Bank National Standard LLC
(NSB) on CreditWatch with negative implications.

The CreditWatch placement reflects the bank's weakened business
position and additional pressure on its capital and
profitability, which constrains the bank's loss-absorption
capacity amid the challenging operating environment in Russia, in
S&P's view.

S&P observes that in 2016 the bank experienced a structural
decline in the earnings power and the dynamism of its core
business, resulting in net losses of Russian ruble (RUB) 820
million (about $13 million) for the first nine months of 2016
under International Financial Reporting Standards (IFRS), or
about 15% of the bank's reported shareholder equity as of Sept.
30, 2016.  Annualized credit costs for the first nine months of
2016 comprised a high 6.9% of the bank's average gross loan
portfolio for the same period, which is worse than system-wide
average metric.

S&P estimates that the bank's gross loan book will have
contracted by about 25% in 2016 under IFRS, and consider that
single-name concentrations are even more visible.  The top-20
borrowers accounted for about 80% of the bank's loan portfolio as
of Jan. 1, 2017, under Russian general accepted accounting
principles, which is higher than the sector average for Russian

"Therefore, we revised our assessment of the bank's business
position to weak from moderate.  This resulted in our revising
downward our assessment of its stand-alone credit profile to 'b-'
from 'b'.  We expect that NSB's business franchise will remain
relatively narrow in the next 12-18 months, given its cautious
expansion strategy.  We think that NSB's business model is
currently poorly diversified, as demonstrated by high
concentrations on both sides of its balance sheet.  The bank's
clientele still mostly consists of large and midsize Russian
corporations, though the bank aims to diversify its business by
focusing on small and midsize enterprises in regions where it
operates instead of large corporates, as was previously the case.
We understand that it will likely take time to improve the
diversity of its business activity and restore earnings power.
At the same time, we believe that the bank is in transition
period and deterioration in its financial performance is largely
a result of a continued shift in its strategy and business model.
As such, we have included a one-notch positive adjustment for
additional factors into the rating," S&P noted.

S&P believes that the bank's risk-adjusted capital (RAC) ratio is
likely to remain above 5% over S&P's outlook horizon of 12-18
months.  At the same time, S&P notes that the bank's total
regulatory capital adequacy ratio was at a high 27.9% on Jan. 1,
2017, comfortably above the regulatory minimum of 8%.

As of Jan. 1, 2017, cash and equivalents including interbank
placements accounted for 8% of the bank's total assets.  At the
same date, NSB's unpledged portfolio of highly-liquid bonds
amounted to RUB6.5 billion (or almost one-quarter of the bank's
total assets).  The bank is mainly funded by customer deposits,
which made up 60% of its total liabilities on Sept. 30, 2016.
The depositor base is fairly concentrated with the top-20
depositors amounting to about 40% of total deposits.  The ratio
of broad liquid assets to short-term wholesale funding stood at
1.65x as of Sept. 30, 2016, which is not materially worse than
that of the bank's peers.

The CreditWatch placement with negative implications reflects
S&P's concerns regarding the bank's ability to restore weakened
earning power and business sustainability amid the still-
challenging economic conditions in Russia.

S&P plans to resolve the CreditWatch placement within the next
three months.  During this period, S&P is going to assess the
bank's implementation of its strategy and its ability to curb
credit costs, and restore earnings capacity while improving the
diversity of its business activity.

If S&P was to see its franchise and business continues to
deteriorate despite management's efforts to implement the new
strategy, S&P could downgrade NSB to 'B-' from 'B'.  S&P could
also lower the ratings by one notch if NSB's capitalization were
to decline, with our RAC ratio before adjustment for
concentration and diversification falling well below 5%.

S&P could affirm the ratings and take them off CreditWatch if it
receives strong evidence that the bank's new strategy is viable
and improving its business sustainability and diversity while
asset-quality metrics do not deteriorate.

ENISEY JSCB: Put on Provisional Administration, License Revoked
The Bank of Russia, by its Order No. OD-369, dated February 9,
2017, revoked the banking license of Krasnoyarsk-based credit
institution Joint-stock commercial bank ENISEY (public joint-
stock company) or JSCB ENISEY (PJSC) (Registration No. 474) from
February 9, 2017, according to the press service of the Central
Bank of Russia.

The Bank of Russia took such an extreme measure -- revocation of
the banking license -- because of the credit institution's
failure to comply with federal banking laws and Bank of Russia
regulations, establishment of facts of material financial
misstatements, repeated application within a year of measures
envisaged by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)", and considering the existence of a
real threat to the interests of the bank's creditors and

The credit institution implemented high-risk lending policy
connected with the placement of funds into poor quality assets.
An adequate assessment of the risks assumed and a reliable
recognition of the bank's assets resulted in a total loss of the
bank's capital.  JSCB ENISEY failed to comply with supervisor's
requirements to establish loan loss provisions and submit
statements on its actual financial status and the existence of
grounds to revoke the banking license.

Both management and owners of the credit institution did not take
any effective measures to bring its activities back to normal.
Under these circumstances, the Bank of Russia took a decision to
revoke the banking licence from JSCB ENISEY (PJSC).

The Bank of Russia, by its Order No. OD-370, dated February 9,
2017, appointed a provisional administration to JSCB ENISEY
(PJSC) for the period until the appointment of a receiver
pursuant to the Federal Law "On Insolvency (Bankruptcy)" or a
liquidator under Article 23.1 of the Federal Law "On Banks and
Banking Activities".  In accordance with federal laws, the powers
of the credit institution's executive bodies are suspended.

JSCB ENISEY (PJSC) is a member of the deposit insurance system.
The revocation of the banking license is an insured event as
stipulated by Federal Law No. 177-FZ "On the Insurance of
Household Deposits with Russian Banks" in respect of the bank's
retail deposit obligations, as defined by legislation.  The said
Federal Law provides for the payment of indemnities to the bank's
depositors, including individual entrepreneurs, in the amount of
100% of the balance of funds but not more than RUR1.4 million per

According to the financial statements, as of January 1, 2017,
JSCB ENISEY (PJSC) ranked 254th by assets in the Russian banking


TURKIYE IS BANKASI: Fitch Maintains Stable Outlook on DPR
Fitch Ratings has downgraded three Turkish diversified payment
rights (DPR) programme ratings and affirmed three others. At the
same time, the agency has maintained the Stable Outlook on two of
the programmes and revised the Outlooks on four programmes to
Stable from Negative.

The DPR programmes are A.R.T.S. Ltd. (ARTS, originated by Akbank
T.A.S.; rated BB+/Stable/B), Bosphorus Financial Services Limited
(Bosphorus, originated by Finansbank A.S.; rated BBB-/Stable/F3),
Garanti Diversified Payment Rights Finance Company (Garanti DPR,
originated by Turkiye Garanti Bankasi A.S.; rated BBB-
/Stable/F3), TIB Diversified Payment Rights Finance Company (TIB
DPR, originated by Turkiye Is Bankasi A.S.; rated BB+/Stable/B),
VB DPR Finance Company (VB DPR, originated by Turkiye Vakiflar
Bankasi T.A.O.; rated BB+/Stable/B) and Yapi Kredi Diversified
Payment Rights Finance Company Ltd Company (Yapi DPR, originated
by Yapi ve Kredi Bankasi A.S.; rated BBB-/Stable/F3).

The review followed the recent rating actions on Turkish banks,
and the downgrade of Turkey's Long-Term IDR to 'BB+' from 'BBB-'.

The DPR programmes are financial future flow securitisations
backed by originating bank's generation of hard currency flows
arising from DPRs. DPRs are payment orders processed by
correspondent banks and mainly reflect payments due on the export
of goods and services, capital flows and personal remittances
(typically SWIFT-related payments).

Fitch maintains the Going Concern Assessment (GCA) scores
assigned to the originating banks. While Finansbank A.S. has been
assigned a GC2 score based on its highly rated parent (Qatar
National Bank, AA-/Stable/F1+), all other banks subject to this
rating action have a GC1 score.

One-notch downgrade of the ratings of Bosphorus and ARTS - whose
ratings were on Negative Outlook - reflects the recent downgrade
of the Local Currency (LC) IDR of the originating banks. By doing
so, Fitch has maintained the two-notch differential between the
bank's LC IDR and the rating of the programme for Bosphorus based
on the originator's GC2 score and the parent support driven LC
IDR. The notching uplift from LC IDR has been maintained at three
notches for ARTS as its proportion of future flow debt to the
total debt of the originator is relatively high.

The agency has narrowed the notching uplift from three to two
notches for VB DPR given that its debt service coverage ratios
(DSCRs) have not been in line with Fitch's expectation for DPR
programmes rated in the 'A' category and also have been lower
than the peer programmes. The smaller notching uplift also
factors in that the originating bank's LC IDR and GCA are driven
by state support.

Fitch has widened the notching differential between the LC IDR
and the rating for TIB DPR to four from three notches since its
DSCRs, programme size relative to the bank's total liabilities
and flow characteristics are deemed to warrant a higher uplift.

The affirmations of ratings of Garanti DPR and Yapi DPR, on the
other hand, are driven by the LC IDRs of the originating banks
and their GC1 scores. The agency has increased the uplifts from
the respective bank's LC IDR from two to three notches for Yapi
DPR and Garanti DPR by considering their DSCRs, programme size
relative to the respective banks' balance sheets and also flow

The revisions on the Outlooks from Negative to Stable on ratings
of VB DPR, ARTS, Yapi DPR and Bosphorus mirror that on the
originating banks. Further, Fitch has maintained the Stable
Outlook on Garanti DPR, reflecting the same on the originator.

The rating will be under pressure for Garanti DPR should the
future flow debt relative to the bank's liabilities increase or
its flow amounts decrease. Also, a sustained material reduction
in Yapi DPR's coverage ratios may put the DPR ratings under
pressure while TIB DPR is expected to withstand a significant
flow decline without warranting a rating action as the programme
has been reporting particularly strong coverage ratios.

The DSCRs based on offshore DDB flows which the agency considers
in its analysis, were about 115x (TIB DPR), 60x (Yapi DPR), 40x
(Garanti DPR), 50x (ARTS), 28x (VB DPR) and 33x (Bosphorus DPR)
after applying Fitch's interest rate stresses for the
corresponding ratings. The current DSCRs of all programmes are
well above the trigger ratios in the transaction documents.

Overall, security and political developments have undermined
economic performance and impacted the hard-currency money
transfers into and out of Turkey which have put pressure on DPR
volumes in 2016 as expected. While the declining trend in flow
amounts seems to be reversing for some programmes based on their
reported performance since September, more data are required to
opine on the matter.

The most significant variables affecting the transactions'
ratings are the credit quality of the originating bank, the
impact of the parent on the bank's Long-Term LC IDR, the GCA
score, and DSCR. A change in any of these variables will be
analysed for their impact on the transaction's ratings.

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action

Fitch has checked the consistency and plausibility of the
information it has received about the performance of the DPR
programmes. There were no findings that were material to this
analysis. Fitch has neither requested any third party assessment
of the information about DPR flows nor conducted a review of
origination files because there is no existing asset portfolio to
assess in future flow transactions.

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.

The information below was used in the analysis.
  - Investor reports and information provided by Akbank T.A.S. as
at 6 February 2017
  - Investor reports and information provided by Finansbank A.S.
as at 6 February 2017
  - Investor reports and information provided by Turkiye Garanti
Bankasi A.S. as at 6 February 2017
  - Investor reports and information provided by Turkiye Is
Bankasi A.S. as at 6 February 2017
  - Investor reports and information provided by Turkiye Vakiflar
Bankasi T.A.O. as at 6 February 2017
- Investor reports and information provided by Yapi ve Kredi
Bankasi A.S. as at 6 February 2017


PRIVATBANK: Central Bank Won't Change Stance on Bail-in
Natalia Zinets at Reuters reports that Ukraine's central bank is
ready to meet bondholders of recently nationalized Privatbank,
but it will not change its position that a bail-in of their bonds
was justified and legal.

Ukraine took Privatbank, the country's largest lender, under
state control in December, but a group of the lender's creditors
has protested against a decision to convert US$555 million worth
of Eurobonds into equity and threatened legal action, Reuters

"We are prepared to meet with representative of the bondholders.
We are prepared to lay out our position and believe that our
position is legal and reasonable from a banking practice
perspective," Reuters quotes deputy central bank chief
Kateryna Rozhkova as saying.

Privatbank was taken under state control with the backing of the
International Monetary Fund, with which Ukraine has agreed a
reform program in exchange for loans worth US$17.5 billion,
Reuters recounts.

The nationalization has so far cost taxpayers US$4.3 billion and
an upcoming audit will reveal how much more might be added to the
bill, Reuters notes.

                           *   *   *

As reported by the Troubled Company Reporter-Europe on Jan. 16,
2017, S&P Global Ratings revised its counterparty credit ratings
on Ukraine-based PrivatBank to 'SD' (selective default) from 'R'.
The rating action follows the Deposit Guarantee Fund's
announcement that PrivatBank's three outstanding loan
participation notes have been bailed in following the placing of
the bank under temporary administration in late December 2016.

U N I T E D   K I N G D O M

BANK OF IRELAND: Moody's Raises LT Deposit Rating from Ba1
Moody's Investors Service has upgraded the long-term deposit
ratings of Bank of Ireland (UK) Plc (BOI UK) to Baa3 from Ba1.
Moody's also upgraded the bank's baseline credit assessment (BCA)
and adjusted BCA to baa3 from ba1 and its long-term counterparty
risk assessment (CR Assessment) to A3(cr) from Baa1(cr). The
short-term CR Assessment was confirmed at Prime-2(cr). The
outlook on the bank's long-term deposit ratings is positive. The
bank's short-term deposit ratings were upgraded to Prime-3 from
Not Prime.

The upgrade of BOI UK's ratings reflects 1) the progress it has
made towards reducing financial and operational linkages with
Bank of Ireland (BOI) and therefore reducing its likelihood of
failure; and 2) relatively strong financials compared with those
of its parent, Bank of Ireland (BOI, LT deposit ratings Baa1/LT
issuer ratings Baa2 with positive outlook, BCA ba1).

The rating action concludes a review process initiated in October



The upgrade of BOI UK's BCA and adjusted BCA to baa3, one notch
above the BCA of BOI, reflects the assessment of reduced
financial and operational linkages with the bank's Irish parent
and improved financials.

In Moody's view, BOI UK's financial and operational independence
from BOI has increased, and the standalone creditworthiness of
BOI is less of a constraint upon that of BOI UK. Since 2014, BOI
UK generates all of its own business in the UK, using its excess
liquidity to fund its own growth. Prior to this, BOI UK entered
into a number of asset transfers and related capital transactions
with its parent. In addition, exposure to BOI via interest rate
hedging transactions has materially reduced with hedging now
being structured through derivative transactions. Moody's further
expects that capital transfers between the entities will now be
limited to dividend payments, which would require board approval
subject to compliance with regulatory capital requirements.

BOI UK is largely funded by customer deposits as well as making
some use of the Bank of England's term funding facilities, and
its use of funding from BOI is immaterial. Beyond this, the bank
has also developed and implemented its own transfer pricing
mechanism, having previously relied on BOI's methodology.

Nevertheless, Moody's believes that some significant connections
between BOI UK and its parent remain, in particular (1) its
reliance on BOI for the provision of some crucial operational and
IT services through Service Level Agreements; (2) their continued
close strategy and business planning interlinkages together with
shared risk governance within the group's risk appetite
framework; and (3) brand association and reputational risk-

In addition to greater operational independence from BOI, the
rating upgrade was supported by the improving trends in the
standalone financial fundamentals of BOI UK, namely: (1) its
improving asset risk metrics, despite the downside risk arising
from the bank's relatively high average loan-to-value (LTV) ratio
compared to other UK lenders and its legacy commercial loan book;
(2) its solid capital position; (3) its improved profitability,
although business volumes and interest margins could be
challenged by an uncertain operating environment in the wake of
the UK's decision to leave the EU; and (4) a stable funding
profile and a broad deposit base, reinforced by the bank's
strategic partnerships with the Post Office and the Automobile
Association (AA).

The assessment of these factors led Moody's to position BOI UK's
BCA at baa3, one notch above the BCA of BOI thus introducing a
differential between the standalone ratings of the parent and
subsidiary. This positioning of the BCA acknowledges the stronger
financial profile of the UK subsidiary compared with its parent
as expressed in BOI UK's scorecard range at baa2-a3 based on the
latest financials. Nevertheless, the remaining linkages with the
parent, as noted above, limit this differential to one notch.


The Baa3 long-term deposit ratings incorporate the results of
Moody's Advanced Loss Given Failure (LGF) analysis, which
indicates that BOI UK's deposits are likely to face a moderate
loss-given-failure. A low level of subordinated debt in the
liability structure, that would otherwise provide a loss
absorbing cushion for deposits, and a relatively modest layer of
junior deposits in the liability structure, given the bank's
largely retail depositor base, result in no uplift from the BCA
level for deposit ratings.


The outlook on BOI UK's long-term deposit rating is positive, in
line with the outlook on BOI's ratings. BOI UK's own metrics may
come under some pressure given an expected slowdown in the UK
resulting from the process of leaving the EU. However a more
positive dynamic in Ireland will likely benefit its parent BOI's
creditworthiness, which would therefore be a lesser constraint on
that of BOI UK's BCA. As such an upgrade in BOI's BCA would
likely lead to an upgrade in BOI UK's BCA and its deposit rating.

Counterparty Risk (CR) Assessment

The CR Assessment was upgraded and positioned at A3(cr)/ Prime
2(cr), three notches above the BOI UK's BCA of baa3, based on the
cushion against default provided to the senior obligations
represented by the CR Assessment by subordinated instruments.


BOI UK's deposit ratings could be upgraded following (1) an
upgrade in the BCA of its parent BOI, which would likely lead to
an upgrade in BOI UK's own BCA; or (2) a material increase in the
bank's bail-in-able debt.

Given the positive outlook, a downgrade of the ratings is
currently unlikely. But BOI UK's deposit ratings could be
downgraded as a result of a downgrade of its baa3 BCA driven by
asset quality deterioration, unexpected losses that lead BOI UK's
capitalisation to decline significantly, or a material reduction
in its profitability.


The principal methodology used in these ratings was Banks
published in January 2016.

MARRACHE & CO: Liquidators Begin Legal Action Against Jyske
Gabriella Peralta at Gibraltar Chronicle reports that liquidators
of collapsed law firm Marrache & Co on Feb. 8 began court
proceedings alleging Jyske Bank "dishonestly assisted" Marrache
brothers Benjamin, Isaac and Solomon as they defrauded clients of
their firm.

According to Gibraltar Chronicle, Edgar Lavarello and Adrian
Hyde, the liquidators, claim Jyske should have detected that the
Marrache brothers were using client accounts to repay loans owed
to the bank.

At the opening of a month-long legal dispute on Feb. 8, lawyers
on behalf of the liquidators aim to recover some of the losses
incurred during the collapse of solicitors firm Marrache & Co.,
Gibraltar Chronicle relays.

Court documents in the case indicate the liquidators expect to
recover GBP300,000 from the bank, Gibraltar Chronicle discloses.

Marrache & Co opened client and office accounts with Jyske Bank
in 2001, which remained open until its collapse in 2009,
Gibraltar Chronicle recounts.

The court heard how accounts were regularly overdrawn with large
sums of cash moving between the Marrache's office and personal
accounts and their client accounts, Gibraltar Chronicle relates.

RANGERS FOOTBALL: Liquidators Sue Former Administrators
Scottish Daily Mail reports that the liquidators of Rangers FC
have launched a GBP28.9 million legal action against the club's
former administrators.

BDO have sued Paul Clark and David Whitehouse, who worked with
accountancy firm Duff & Phelps when the football club entered
administration in 2012, Scottish Daily Mail relates.

According to Scottish Daily Mail, the claim at the Court of
Session in Edinburgh centers on the strategy taken by the
administrators when the club went bust.

Four months after Rangers went into administration, the business
and assets were sold to a consortium led by Charles Green for
GBP5.5 million, Scottish Daily Mail recounts.  BDO were then
appointed as liquidators, Scottish Daily Mail relays.

A BDO spokesman, as cited by Scottish Daily Mail, said:
"Questions have arisen which have not adequately answered.  The
liquidators have been left with no option but to pursue the
matter via the Scottish Court.  It is understood that Duff &
Phelphs gave BDO a 37-page response to questions raised last
April, but had no response."

"BDO is alleging that as the administrators we should have
achieved a better return for creditors by selling the club's
assets on a piecemeal basis," Scottish Daily Mail quotes
Mr. Whitehouse, Duff & Phelphs managing director, as saying.

* UK Buy-to-Let RMBS 90-plus Days Delinquencies Slightly Down
The 90-plus days delinquencies of UK buy-to-let residential
mortgage-backed securities (RMBS) slightly decreased to 0.4% from
0.5% in the three-month period ended November 2016, according to
the latest indices published by Moody's Investors Service.

Cumulative losses decreased to 0.3% of original pool balance in
November 2016 from 0.9% in August 2016. Aire Valley terminated in
November 2016 leading to the reduction in losses.

The total redemption rate decreased to 12% from 11.4% in the same
period, about at the same level as the 12-months average of

Moody's expects that the collateral performance of UK buy-to-let
RMBS will remain stable given expected GDP growth of 1.0% in
2017, low interest rates, and low unemployment levels (see
"Government of United Kingdom -- Aa1 Negative", January 2017, and
RMBS and ABS - EMEA Outlook, December 2016,

As of November 2016, the total outstanding pool balance of the 37
UK BTL RMBS transactions rated by Moody's was GBP21.5 billion
compared to GBP28.6 billion in August 2016.


* BOOK REVIEW: Hospitals, Health and People
Author: Albert W. Snoke, M.D.
Publisher: Beard Books
Softcover: 232 pages
List Price: $34.95
Review by Francoise C. Arsenault
Order your personal copy today at
Hospitals, Health and People is an interesting and very readable
account of the career of a hospital administrator and physician
from the 1930's through the 1980's, the formative years of
today's health care system. Although much has changed in
hospital administration and health care since the book was first
published in 1987, Dr. Snoke's discussion of the evolution of
the modern hospital provides a unique and very valuable
perspective for readers who wish to better understand the forces
at work in our current health care system.

The first half of Hospitals, Health and People is devoted to the
functional parts of the hospital system, as observed by Dr.
Snoke between the late 1930's through 1969, when he served first
as assistant director of the Strong Memorial Hospital in
Rochester, New York, and then as the director of the Grace-New
Haven Hospital in Connecticut. In these first chapters, Dr.
Snoke examines the evolution and institutionalization of a
number of aspects of the hospital system, including the
financial and community responsibilities of the hospital
administrator, education and training in hospital
administration, the role of the governing board of a hospital,
the dynamics between the hospital administrator and the medical
staff, and the unique role of the teaching hospital.
The importance of Hospitals, Health and People for today's
readers is due in large part to the author's pivotal role in
creating the modern-day hospital. Dr. Snoke and others in
similar positions played a large part in advocating or forcing
change in our hospital system, particularly in recognizing the
importance of the nursing profession and the contributions of
non-physician professionals, such as psychologists, hearing and
speech specialists, and social workers, to the overall care of
the patient. Throughout the first chapters, there are also many
observations on the factors that are contributing to today's
cost of care. Malpractice is just one example. According to
Dr. Snoke, "malpractice premiums were negligible in the 1950's
and 1960's. In 1970, Yale-New Haven's annual malpractice
premiums had mounted to about $150,000." By the time of the
first publication of the book, the hospital's premiums were
costing about $10 million a year.

In the second half of Hospitals, Health and People, Dr. Snoke
addresses the national health care system as we've come to know
it, including insurance and cost containment; the role of the
government in health care; health care for the elderly; home
health care; and the changing role of ethics in health care. It
is particularly interesting to note the role that Senator Wilbur
Mills from Arkansas played in the allocation of costs of
hospital-based specialty components under Part B rather than
Part A of the Medicare bill. Dr. Snoke comments: "This was
considered a great victory by the hospital-based specialists. I
was disappointed because I knew it would cause confusion in
working relationships between hospitals and specialists and
among patients covered by Medicare. I was also concerned about
potential cost increases. My fears were realized. Not only
have health costs increased in certain areas more than
anticipated, but confusion is rampant among the elderly patients
and their families, as well as in hospital business offices and
among physicians' secretaries." This aspect of Medicare caused
such confusion that Congress amended Medicare in 1967 to provide
that the professional components of radiological and
pathological in-hospital services be reimbursed as if they were
hospital services under Part A rather than part of the copayment
provisions of Part B.

At the start of his book, Dr. Snoke refers to a small statue,
Discharged Cured, which was given to him in the late 1940's by a
fellow physician, Dr. Jack Masur. Dr. Snoke explains the
significance the statue held for him throughout his professional
career by quoting from an article by Dr. Masur: "The whole
question of the responsibility of the physician, of the
hospital, of the health agency, brings vividly to mind a small
statue which I saw a great many years is a pathetic
little figure of a man, coat collar turned up and shoulders
hunched against the chill winds, clutching his belongings in a
paper bag-shaking, tremulous, discouraged. He's clearly unfit
for work-no employer would dare to take a chance on hiring him.
You know that he will need much more help before he can face the
world with shoulders back and confidence in himself. The
statuette epitomizes the task of medical rehabilitation: to
bridge the gap between the sick and a job."

It is clear that Dr. Snoke devoted his life to exactly that
purpose. Although there is much to criticize in our current
healthcare system, the wellness concept that we expect and
accept today as part of our medical care was almost nonexistent
when Dr. Snoke began his career in the 1930's. Throughout his
50 years in hospital administration, Dr. Snoke frequently had to
focus on the big picture and the bottom line. He never forgot
the importance of Discharged Cured, however, and his book
provides us with a great appreciation of how compassionate
administrators such as Dr. Snoke have contributed to the state
of patient care today.

Albert Waldo Snoke was director of the Grace-New Haven Hospital
in New Haven, Connecticut from 1946 until 1969. In New Haven,
Dr. Snoke also taught hospital administration at Yale University
and oversaw the development of the Yale-New Haven Hospital,
serving as its executive director from 1965-1968. From 1969-
1973, Dr. Snoke worked in Illinois as coordinator of health
services in the Office of the Governor and later as acting
executive director of the Illinois Comprehensive State Health
Planning Agency. Dr. Snoke died in April 1988.


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, Julie Anne L. Toledo, Ivy B. Magdadaro, and
Peter A. Chapman, Editors.

Copyright 2017.  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,
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members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
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