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        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 17, 2017, Vol. 18, No. 035


                            Headlines


G E R M A N Y

TUI AG: S&P Raises CCR to 'BB' on Resilient Operating Performance


G R E E C E

NAVIOS MARITIME: Moody's Affirms B3 Corporate Family Rating
YIOULA GLASSWORKS: S&P Suspends 'CCC+' CCR on Lack of Information


I R E L A N D

CARLYLE GLOBAL 2014-2: Fitch Affirms Rating on Cl. E Debt at 'B-'
INFINITY 2007-1: Fitch Lowers Rating on Class C Notes to 'Csf'
NEWHAVEN CLO: Fitch Affirms 'B-sf' Rating on Class F-R Notes
ST. PAUL'S CLO II: Fitch Assigns 'B-sf' Rating to Class F-R Notes
* IRELAND: To Seek EU Funding for Firms Affected by Brexit


K A Z A K H S T A N

SAMRUK-ENERGY JSC: Fitch Affirms 'BB+' LT Issuer Default Rating


L U X E M B O U R G

ARCELORMITTAL: Egan-Jones Hikes Sr. Unsecured Ratings to B+
INTELSAT SA: Egan-Jones Lowers Sr. Unsecured Ratings to CCC


N E T H E R L A N D S

CARLYLE GLOBAL: Moody's Assigns B2 Rating to Cl. E-R Sr. Notes
DRYDEN 39 EURO: S&P Affirms 'B-' Rating on Class F Notes


P O R T U G A L

METROPOLITANO DE LISBOA: S&P Affirms 'BB+' ICR, Outlook Stable


R U S S I A

CB IMONEYBANK: Liabilities Exceed Assets, Assessment Shows
PROMENERGOBANK JSC: Liabilities Exceed Assets, Assessment Shows
TRANSFIN-M OJSC: S&P Revises Outlook to Stable & Affirms B Rating
WESTINTERBANK LLC: Liabilities Exceed Assets, Assessment Shows


S E R B I A

SERBIA: Must Stop Financing Unprofitable State Firms, IMF Says


S P A I N

BANCO POPULAR: Fitch Lowers LT IDR to B+, Outlook Revolving
BANKIA SA: Fitch Affirms BB+ Subordinated Debt Rating
CAJA GRANADA: Fitch Affirms 'CCsf' Rating on Class D Notes

U N I T E D   K I N G D O M

CO-OPERATIVE BANK: Moody's Affirms Caa2 Long-Term Deposit Rating
JTJ WORKPLACE: Enters Into Corporate Voluntary Arrangement
MALLINCKRODT INTERNATIONAL: S&P Rates $1.862MM Sr. Sec. Loan BB+
STANLINGTON NO.1: Moody's Assigns (P)Ba2 Rating to Cl. E Notes
TATA STEEL UK: Workers Vote in Favor of Pension Scheme Changes


X X X X X X X X

* BOOK REVIEW: Risk, Uncertainty and Profit


                            *********



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G E R M A N Y
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TUI AG: S&P Raises CCR to 'BB' on Resilient Operating Performance
-----------------------------------------------------------------
S&P Global Ratings raised its long-term corporate credit rating of
the Germany-based tourism company TUI AG to 'BB' from 'BB-'.  The
outlook is stable.

S&P also raised its issue ratings on TUI's senior unsecured notes
and the revolving credit facility (RCF) to 'BB' from 'BB-'.  The
recovery rating on both instruments remains '3', indicating S&P's
expectation of recovery in the higher half of the 50%-70% range.

The upgrade reflects the resilience the company has demonstrated
in the face of turbulent external events in the tourism industry,
particularly in 2016, its strengthened product and geographic
diversification in recent years, and its steadily improving
operating margins, which are above those of peers.  This has been
achieved despite negative foreign exchange translation effects
after the British pound sterling depreciation against the euro in
2016 as well as terrorist attacks in destination markets like
Tunisia, Turkey, and Egypt from 2014 to 2016.  As such, S&P has
revised its assessment of TUI's business risk profile upward to
the lower end of S&P's fair category, from weak previously.

"In our view, TUI's resilience against negative external events,
which were often the reason for unexpected shortfalls in operating
results in the company's historical financials, has improved,
resulting in increased predictability of earnings and cash flows.
We consider that TUI has made significant progress in recent years
in vertically integrating its business.  This resulted in greater
product diversity than a pure trading company that sells packaged
holidays without having its own hotel or cruise ship business and
greater geographic diversification in its destination markets,
especially outside the Euro-Mediterranean region.  The company now
derives almost 50% of its underlying EBITA from content business,
which includes cruise ships, hotels, and resorts, compared to only
25% four years ago.  This development is supported by strong brand
recognition perceived in its main sourcing markets of Germany and
the U.K," S&P said.

At the same time, the company improved its access to end-customers
in source markets, which allows it to better manage the capacity
utilization of its hotels and cruise ships, optimize selling
prices, and extract higher operating margins relative to peers in
the tour operator industry.  In this respect, S&P also views
positively TUI's increasing direct and online marketing shares
relative to its total marketing activities.  The latter helps the
company manage client relationships in a cost-efficient manner.
In addition, TUI's large size puts it in a favorable negotiating
position with hotel owners and enables it to offer exclusive
locations.

"This said, we assess TUI's business risk profile at the lower end
of our fair category.  This reflects the group's exposure to the
global tourism industry's cyclicality and strong seasonality,
which result in significant event risk.  In addition, TUI is
exposed to changes in discretionary consumer spending that are
linked to general economic developments.  Online competition and
increased comparability of offers and prices pose another source
of risk to the business model," S&P said.

S&P also sees the business as capital intensive given its
investments in hotels, aircraft, and cruise ships; therefore S&P
requires relatively modest financial leverage for TUI's present
rating.  Also, the S&P Global Ratings' adjusted EBITDA margin for
TUI is still lower than for certain other companies S&P rates in
the leisure segment, despite the positive margin trend S&P
observed during the past six years.

With respect to TUI's financial risk profile, as a weighted
average over 2015-2019, S&P estimates S&P Global Ratings' adjusted
funds from operations (FFO) to debt at 25%-28%, which is at the
upper end of the range for S&P's significant category.  S&P notes,
however, that this metric is based on a relatively benign lease
adjustment, reflecting relatively short aircraft lease contracts.
S&P's forecast of debt to EBITDA at 2.6x-2.8x is at the lower end
of the respective ranges for our intermediate financial risk
category.  At the same time, S&P estimates discretionary cash flow
(DCF) to debt of close to 10%, which is also in S&P's significant
category, while its high estimate of capital expenditure (capex)
investments result in a free operating cash flow (FOCF) lower than
our estimated dividend payments for the next two years.

"The stable outlook on TUI reflects our expectation that the
company's operating performance will remain resilient, in spite of
challenging economic, politic, and geopolitical events,
particularly in Europe.  We expect TUI's EBITDA will continue
improving, based on a moderately positive outlook for the industry
in 2017, and that its credit metrics will hover at around current
levels.  We also factor in our expectations that large investments
in cruise ships and hotels, together with dividend payments, will
result in moderately low negative DCF for the next few years.  We
also do not believe that proceeds from a sale of Hapag-Lloyd
shares and Travelopia businesses will be devoted to debt
reduction, and therefore don't expect these transactions will
affect the rating.  We consider that the impact from a potential
cooperation with Etihad concerning the airline business is too
early to assess given the ongoing discussions between the
parties," S&P noted.

S&P would likely lower its ratings on TUI if unexpected operating
setbacks, possibly resulting from a deterioration of the economic
environment due to political or terrorist events, or from a more
aggressive-than-expected financial policy, led to weaker operating
underperformance and S&P Global Ratings' adjusted FFO to debt of
lower than 20%.  S&P could also consider lowering the ratings if
it anticipated that TUI's liquidity would deteriorate to less than
adequate.

S&P sees a further improvement of the rating as unlikely at the
moment, given the company's current business risk profile and
S&P's anticipation of its medium-term capital structure.
Nevertheless, any future upside would need to be predicated on
further strengthening of TUI's business risk profile, which would
improve the resilience of the company's business model to external
shock, coupled with FFO to debt sustainably in the mild-to-higher
end of the 30%-45% range, together with a financial policy
conducive to the maintenance of these ratios, with, among others,
dividend payments not exceeding FOCF.



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G R E E C E
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NAVIOS MARITIME: Moody's Affirms B3 Corporate Family Rating
-----------------------------------------------------------
Moody's Investors Service affirmed the B3 corporate family rating
of Navios Maritime Partners L.P. and assigned a B3 rating to the
proposed $400 million term loan B due 2022 currently being
marketed. Moody's has also changed the outlook for all ratings to
stable from negative.

This rating action follows Navios Maritime Partners' announcement
of a refinancing of its senior secured term loan due 2018 with a
new term loan due 2022. The terms of the new facility are expected
to be similar to the existing instrument with the exception of an
increase in amortization to 2.5% for the first two years and 5%
thereafter; the current facility provides for amortization of 1%
per annum. The transaction was launched with a margin of LIBOR +
450 bps.

"The refinancing is credit positive for Navios Maritime Partners
because it addresses its largest near-term maturity," says Maria
Maslovsky, a Moody's Vice President and lead analyst for the
issuer. "Following debt reduction of approximately $180 million in
2016 and early 2017, Navios' only other maturity beside the term
loan is an approximately $42 million secured bank facility coming
due in November 2017. NMM expects to refinance it on a secured
basis using the existing collateral; in combination with the
proposed term loan, the company will thus address all of its
maturities and strengthen its liquidity," adds Maslovsky.

RATINGS RATIONALE

The rating affirmation reflects Navios' success in reducing its
leverage and extending maturities. NMM has meaningfully de-
leveraged over the past year by prudently suspending its dividends
in the first quarter of 2016 at the trough of the dry bulk market;
it also benefited from the sale of its largest container ship, MSC
Christina. The combination of these approaches allowed Navios to
achieve moderate leverage for the rating category at approximately
4.4x for 2016 and below 4.0x pro forma for the sale of MSC
Christina and debt paydown in January 2017. Positively, NMM's
coverage measured as funds from operations (FFO)+Interest
Expense/Interest Expense is strong relative to similarly rated
peers at 3.7x for 2016.

Navios Maritime Partners' B3 corporate family rating (CFR)
reflects (1) the company's relatively small size with significant
customer concentration; (2) the contagion risks from its parent
which has shown weakness in its financial and liquidity profile;
(3) the significant proportion of charters coming up for renewal
in 2017 in a challenged market environment. More positively, the
rating is supported by (1) Navios Maritime Partners' fairly low
financial leverage relative to its peers; (2) its charter policy
which is based largely on long-term contracts and therefore
provides good revenue visibility; and (3) its low operating costs,
resulting from the fleet-management contract signed with Navios
Holdings.

The dry bulk segment where the majority of Navios' fleet is
deployed has strengthened from its multi-year low in the first
quarter of 2016 as demonstrated by the recovery in the BDI (Baltic
Dry Index); however, Moody's expects the volatility to continue in
2017. This could pose a challenge for Navios which will need to
re-charter 16 out of its 24 dry bulk ships in 2017. Positively,
its container shipping fleet has longer charters with the earliest
coming up for renewal in the second half of 2018.

Pro forma for the refinancing of the term loan B, Navios Maritime
Partners' liquidity is adequate with the only maturity other than
the new term loan occurring in November 2017 when a $32 million
secured facility comes due ($10 million of amortization payments
are due throughout the year). Still, Moody's notes that NMM has no
external liquidity sources and no unencumbered assets. Positively,
the company generated free cash flow of $63 million in 2016.
Presently, Navios Maritime Partners is in compliance with the
covenants under its various credit facilities, although the
headroom is tight in some cases and the company had to make
prepayments and add collateral to its facilities to remain in
compliance over the past year. This is expected to be addressed
with the proposed transaction as the collateral value for the new
term loan will be based on vessel valuations with charters as
opposed to charter-free values in the existing term loan.

STRUCTURAL CONSIDERATIONS

The proposed term loan B is rated at the same level as the
corporate family rating (CFR); it comprises the majority of the
debt. The loan has a loan to value covenant set at 0.8:1 with an
approximately 15% headroom at the outset.

RATIONALE FOR THE STABLE OUTLOOK

The stable outlook reflects the successful debt reduction
accomplished by Navios Maritime Partners' in 2016 and early 2017
and Moody's expectations that leverage will stay within the range
set for the rating, as well as the extension of its debt maturity
profile (pro forma for the new term loan).

WHAT COULD CHANGE THE RATING UP/DOWN

Navios Maritime Partners' ratings could be upgraded if the company
were to comfortably sustain through the cycle and assuming the
resumption of dividends its (1) debt/EBITDA ratio below 5.5x and
(2) funds from operations (FFO) interest coverage (i.e., FFO +
interest expense/interest expense) above 3.5x.

Navios Maritime Partners' ratings could be downgraded if the
company's liquidity profile deteriorates. A debt/EBITDA ratio
above 6.5x and (2) FFO interest coverage below 2.5x for a
prolonged period of time could also be triggers for a downgrade.

List of affected ratings:

Assignments:

Issuer: Navios Maritime Partners L.P.

-- Senior Secured Bank Credit Facility, Assigned B3

Affirmations:

Issuer: Navios Maritime Partners L.P.

-- Corporate Family Rating, Affirmed B3

-- Probability of Default Rating, Affirmed B3-PD

Outlook Actions:

Issuer: Navios Maritime Partners L.P.

-- Changed To Stable From Negative

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Global
Shipping Industry published in February 2014.

Navios Maritime Partners L.P. is an international owner and
operator of dry bulk and container vessels. Navios Maritime
Partners is a master limited partnership (MLP) formed in August
2007 under the laws of the Republic of the Marshall Islands by
Navios Holdings. Navios Holdings currently owns 20.1% of Navios
Maritime Partners. In 2016, the company reported total revenues of
$191 million and EBITDA of $118 million.


YIOULA GLASSWORKS: S&P Suspends 'CCC+' CCR on Lack of Information
-----------------------------------------------------------------
S&P Global Ratings suspended its 'CCC+' long-term corporate credit
rating on Greece-based glass container manufacturer Yioula
Glassworks S.A. and its core subsidiary Glasstank B.V.  S&P also
withdrew its 'CCC' issue rating on the EUR185 million senior
secured notes, due 2019, issued by Glasstank.  The notes have been
redeemed.

The suspension reflects the lack of sufficient, timely, and
reliable information to maintain S&P's ratings on Yioula and its
core operating subsidiary Glasstank, the issuer of the
EUR185 million senior secured notes due in 2019.  In October 2016,
the company entered into a sale and purchase agreement to sell the
majority of its assets, including Glasstank's assets, to
Portuguese glass manufacturer BV Vidro S.A.  The acquisition was
subject to standard regulatory approvals and was expected to close
by year-end 2016 with the notes to be redeemed end-January 2017.

While S&P notes that the bonds have been redeemed, it has not
received confirmation that the disposal of the Glasstank assets
has settled.  In addition, without information from Yioula, S&P
cannot assess the credit quality of the remaining business.  If
the company provides sufficient information within the next 30
days, S&P will use it to determine the rating outcome.  However,
if the level of information remains insufficient or is not of
satisfactory quality to form a rating opinion, S&P will withdraw
the ratings.

S&P Global Ratings may suspend a rating, in rare circumstances, if
there is an expectation that the rating is likely to be
reinstated.  The suspension does not imply that Yioula is not
servicing its obligations.  Should sufficiently detailed
information become available, S&P will reconsider an appropriate
rating.



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CARLYLE GLOBAL 2014-2: Fitch Affirms Rating on Cl. E Debt at 'B-'
-----------------------------------------------------------------
Fitch Ratings has assigned Carlyle Global Market Strategies Euro
CLO 2014-2 D.A.C.'s refinancing notes final ratings and affirmed
the others:

EUR234.6m Class A-1 notes: 'AAAsf'; Outlook Stable
EUR31.4m Class A-2A notes: 'AA+sf'; Outlook Stable
EUR11.6m Class A-2B notes: 'AA+sf'; Outlook Stable
EUR26m Class B notes: 'A+sf'; Outlook Stable
EUR21m Class C notes: 'BBB+sf'; Outlook Stable
EUR27.3m Class D notes: affirmed at 'BBsf'; Outlook Stable
EUR11m Class E: affirmed at 'B-'; Outlook Stable
EUR39.1m Subordinated Notes: not rated

The transaction is a cash flow collateralised loan obligation
securitising a portfolio of mainly European leveraged loans and
bonds. The portfolio is managed by CELF Advisors LLP.

KEY RATING DRIVERS

Carlyle Global Market Strategies Euro CLO 2014-2 D.A.C. closed in
June 2014 and is still in in its reinvestment period, which is set
to expire in August 2018. The issuer has issued new notes to
refinance part of the original liabilities. The refinanced notes
have been redeemed in full as a consequence of the refinancing.

The refinancing notes bear interest at a lower margin over EURIBOR
than the notes being refinanced. The remaining terms and
conditions of the refinancing notes (including seniority) will be
the same as the refinanced notes.

The final ratings reflect Fitch's view that the credit risk of the
refinancing notes will be substantially similar to the notes being
refinanced.

The affirmation of the remaining notes reflects the stable
performance since the last review in May 2016. Credit quality has
remained virtually unchanged, with the weighted average rating
factor as calculated by Fitch standing at 32.68, down from 32.71.
Recovery prospects for the portfolio have fallen with a current
Fitch-calculated weighted average recovery rate of 67.78%, down
from 70.24%. However, the current WARR has a 1.15% cushion
compared with the transaction covenant of 66.63%. There have been
no defaults in the portfolio since the May 2016 review.

RATING SENSITIVITIES
A 25% increase in the obligor default probability could lead to a
downgrade of up to three notches for the rated notes. A 25%
reduction in expected recovery rates could also lead to a
downgrade of up to three notches for the rated notes.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY
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 affected the
rating 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 monitoring.

The majority of the underlying assets have ratings or credit
opinions from Fitch and/or other Nationally Recognized Statistical
Rating Organizations and/or European Securities and Markets
Authority registered rating agencies. Fitch has relied on the
practices of the relevant groups within Fitch and/or other rating
agencies to assess the asset portfolio information.

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


INFINITY 2007-1: Fitch Lowers Rating on Class C Notes to 'Csf'
--------------------------------------------------------------
Fitch Ratings has upgraded Infinity 2007-1 (Soprano)'s class A
notes, downgraded the class C notes and affirmed the others:

EUR44.1m class A (FR0010478420) upgraded to 'Asf'; Outlook Stable
from 'BBsf'; Outlook Negative

EUR36m class B (FR0010478438) affirmed at 'CCCsf'; Recovery
Estimate (RE) revised to 95% from 50%

EUR28.1m class C (FR0010478446) downgraded to 'Csf''; RE 0% from
'CCsf''; RE 0%

EUR22.5m class D (FR0010478453) affirmed at 'Csf''; RE0%

EUR28.1m class E (FR0010478479) affirmed at 'Csf'; RE0%

The transaction is a synthetic securitisation of the monetary
rights arising in favour of the protection seller (the issuer)
under originally 15 credit default swaps (CDS) referencing 15
commercial mortgage loans. The protection buyer is Natixis (A/F1).
One loan now remains, secured by four properties in Germany.

KEY RATING DRIVERS

The upgrade reflects the strong likelihood that upon completion of
the sale of three of the remaining four properties (these three
being subject to signed and notarised sale and purchase
agreements), the higher than expected proceeds will be sufficient
to repay the class A notes. Together with expected recoveries from
the final property, Fitch expects the class B notes to recover
around 95% of principal. In case of unexpected obstacles in the
final administrative stages of the sale, Fitch has also tested
that the class A notes' rating of 'Asf' can withstand a full
breakdown of the process.

There has been solid progress in securing recoveries from property
sales as well as the full repayment of three loans since the last
rating action. The downgrade of the class C notes reflects the now
diminished portfolio of assets from which value can be recovered,
making loss inevitable.

The ratings are capped at 'Asf' given the reliance on Natixis for
the cash deposit (yielding 3M Euribor) acting as note collateral
and for its commitment to pay note margins (the premiums under the
CDS).

Since Fitch's last rating action, three loans have repaid in full.
Fitch expected full recovery on the Les Tanneurs and EHE 1B loans
but some loss was projected on the Massy loan. The sole remaining
loan is the EHE 1A loan backed by four assets, down from 23 at
this point last year. The sales achieved over the last year have
exceeded Fitch's 'Bsf' value expectations by around 15% on
average.

Three of the four remaining assets are subject to notarised sale
agreements for a gross purchase price of EUR67.5m, net proceeds of
which are expected to be applied to the loan in April. Although
originally marketed as a portfolio of four assets, the Itzehoe
property was excluded from this portfolio sale. The December lease
expiry of the main tenant (Edeka) in this property (a secondary
shopping centre) is understood to be the reason why prospective
purchasers were uninterested in this asset.

RATING SENSITIVITIES
Better than expected recoveries on the Itzehoe property could see
full repayment of the class B notes.
Fitch estimate Bsf collateral proceeds of EUR79m.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action

DATA ADEQUACY
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
monitoring.

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 and together with the assumptions referred to above,
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.


NEWHAVEN CLO: Fitch Affirms 'B-sf' Rating on Class F-R Notes
------------------------------------------------------------
Fitch Ratings has assigned Newhaven CLO DAC's refinancing notes
final ratings:

EUR1.5m class X notes: 'AAAsf'; Outlook Stable
EUR205.9m class A-1R notes: 'AAAsf'; Outlook Stable
EUR10m class A-2R notes: assigned 'AAAsf'; Outlook Stable
EUR35m class B-R notes: assigned 'AAsf'; Outlook Stable
EUR23.5m class C-R: affirmed at 'Asf'; Outlook Stable
EUR18.6m class D-R: affirmed at 'BBBsf'; Outlook Stable
EUR20.4m class E-R: affirmed at 'BBsf'; Outlook Stable
EUR10.0m class F-R: affirmed at 'B-sf'; Outlook Stable

Newhaven CLO DAC is a cash flow collateralised loan obligation
securitising a portfolio of mainly European leveraged loans and
bonds. Net proceeds from the issuance of the notes are being used
to refinance the current outstanding notes. The portfolio is
managed by Bain Capital Credit Ltd.

KEY RATING DRIVERS
'B' Portfolio Credit Quality
Fitch assesses the average credit quality of obligors to be in the
'B' category. Fitch has public ratings or credit opinions on 106
of 107 obligors in the identified portfolio. The covenanted
maximum The Fitch weighted average rating factor of the identified
portfolio is 32.97.

High Recovery Expectation
At least 90% of the portfolio comprises senior secured
obligations. Recovery prospects for these assets are typically
more favourable than for second-lien, unsecured and mezzanine
assets. The weighted average recovery rate of the identified
portfolio is 67.77%.

Maturity Extension Risk
The deal deviates from other European CLOs as the collateral
manager has the discretion to vote in favour of maturity
extensions up to a cumulative limit of 25% of the initial target
par balance, with the caveat that the extended maturity is no
later than 18 months before the maturity of the notes.

Fitch believes that limiting the extended maturity to 18 months
before the maturity of the notes would prevent the introduction of
long-dated assets in the portfolio, therefore exposing the
transaction to market value risk. Fitch also got comfort from the
fact that the asset manager will only be allowed to vote in favour
of an amendment to avoid distressed situations in the manager's
judgement, caused by limited access to refinancing by the obligors
in the portfolio.

Exposure to Unhedged Non-Euro Assets
The transaction is allowed to invest up to 5% of the portfolio in
non-euro-denominated assets. Unhedged non-euro-denominated assets
are limited to a maximum exposure of 2.5% of the portfolio subject
to principal haircuts, and any other non-euro-denominated assets
will be hedged with FX forward agreements from settlement date up
to 90 days. The manager can only invest in unhedged or forward-
hedged assets if after the applicable haircuts, the aggregate
balance of the assets is above the reinvestment target par
balance. Investment in non-euro-denominated assets hedged with
perfect asset swaps as of the settlement date is allowed up to 30%
of the portfolio.

Limited Interest Rate Risk Exposure
Between 0% and 15% of the portfolio can be invested in fixed-rate
assets, while 97.2% of liabilities pay a floating-rate coupon. In
addition, the issuer may choose to invest in up to 5% or 10% of
the portfolio in fixed-rate assets by changing to the relevant
matrix. Fitch modelled a maximum of 0%, 5%, 10% and 15% fixed-rate
buckets and found that the rated notes can withstand the interest
rate mismatch associated with each scenario.

From February 2018, the issuer will purchase an interest rate cap
to hedge the transaction against rising interest rates. The
notional of the cap is EUR20m (representing 5.7% of the target par
amount) and the strike rate is 4%. The cap will expire in November
2025.

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
maturity.

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

TRANSACTION SUMMARY
The issuer has amended the capital structure and extended the
maturity of the notes and the reinvestment period. The transaction
features a four-year reinvestment period, which is scheduled to
end in 2021. The maturity has been extended by two years to 2030.

The issuer has introduced the new class X notes, ranking senior to
the class A notes. Principal on these notes is scheduled to
amortise in equal instalments during the first two payment dates.
Class X notional is excluded from the OC tests calculation, but a
breach of this test will divert interest and principal proceeds to
the repayment of the class X notes. Non-payment of scheduled
principal on the class X notes on the specific dates will not
represent an event of default according to the transaction
documents and unpaid principal will be due at the next payment
date.

RATING SENSITIVITIES
A 25% increase in the obligor default probability could lead to a
downgrade of up to two notches for the rated notes. A 25%
reduction in expected recovery rates could lead to a downgrade of
up to three notches for the rated notes.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY
The majority of the underlying assets have ratings or credit
opinions from Fitch and/or other Nationally Recognised Statistical
Rating Organisations and/or European Securities and Markets
Authority registered rating agencies. Fitch has relied on the
practices of the relevant groups within Fitch and/or other rating
agencies to assess the asset portfolio information.

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


ST. PAUL'S CLO II: Fitch Assigns 'B-sf' Rating to Class F-R Notes
-----------------------------------------------------------------
Fitch Ratings has assigned St. Paul's CLO II Designated Activity
Company's notes final ratings:

EUR241.5 million Class A-R notes due 2030: 'AAAsf'; Outlook Stable

EUR40 million Class B-R notes due 2030: 'AAsf'; Outlook Stable

EUR28.5 million Class C-R notes due 2030: 'Asf'; Outlook Stable

EUR21.5 million Class D-R notes due 2030: 'BBBsf'; Outlook Stable

EUR25 million Class E-R notes due 2030: 'BBsf'; Outlook Stable

EUR11 million Class F-R notes due 2030: 'B-sf'; Outlook Stable

St. Paul's CLO II Designated Activity Company is a cash flow
collateralised loan obligation (CLO). The portfolio is managed by
Intermediate Capital Managers Limited. The issuer has issued new
notes to refinance part of the original liabilities and amendments
to the structure have been made.

KEY RATING DRIVERS
'B' Portfolio Credit Quality
Fitch assesses the average credit quality of obligors at the 'B'
category. The Fitch calculated weighted average rating factor
(WARF) of the underlying portfolio is 32.7, below the maximum
covenanted WARF of 34.5. The aggregate collateral balance is
EUR402.2 million, which is above the target par of EUR401 million.

High Recovery Expectations
At least 90% of the portfolio comprises senior secured
obligations. Recovery prospects for these assets are typically
more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch calculated weighted average recovery rate (WARR)
of the identified portfolio is 69.6%, above the minimum covenanted
WARR of 68%.

Diversified Asset Portfolio
The issuer did not change the portfolio covenants, including a
minimum of 65 obligors. The 10 largest obligors now represent 20%
of the portfolio, down from 22.5% at pricing. The maximum Fitch
industry exposure is unchanged and slightly below the current
market standards with a top one industry limit at 15% (vs. market
17.5%), top two at 27.5% and top three at 37.5% (vs. market 40%).

Limited Interest Rate Risk
Unhedged fixed rate assets cannot exceed 10% of the portfolio
while there are no fixed-rate liabilities. The impact of unhedged
interest rate risk was assessed in the cash flow model analysis.

TRANSACTION SUMMARY
Following the issuance of refinancing notes, the refinanced notes
were repaid in full on 15 February 2017. The issuer has amended
the capital structure and extended the maturity of the notes. The
class F-R notes have been introduced and the obligor concentration
limits have been slightly reduced for the top 10 obligors to 20%
of the portfolio, down from 22.5% at pricing and 25% initially,
and per obligor to 2.5% from 3%. A limit of 3% for the top three
obligors has been introduced.

A frequency switch mechanism was introduced following the change
in payment frequency of the notes to quarterly from semi-annually.
The transaction features a four-year reinvestment period, which is
scheduled to end in 2021. The subordinated notes have not been
refinanced. However, the maturity will be extended. The target par
amount of the portfolio has been increased since pricing by EUR1m
to EUR401m.

Fitch's Test Matrix will be provided after closing. However, until
this is finalised, the issuer has to comply with the following
collateral quality tests: WARF of 34.5, WARR of 68%, weighted
average spread of 3.95% and weighted average coupon of 4.5%.

RATING SENSITIVITIES
A 25% increase in the probability of default would cause a
downgrade up to two notches for the rated notes. A 25% decrease in
recovery prospects would cause a downgrade up to three rating
notches for the rated notes.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY
The majority of the underlying assets have ratings or credit
opinions from Fitch and/or other Nationally Recognized Statistical
Rating Organizations and/or European Securities and Markets
Authority registered rating agencies. Fitch has relied on the
practices of the relevant groups within Fitch and/or other rating
agencies to assess the asset portfolio information.

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


* IRELAND: To Seek EU Funding for Firms Affected by Brexit
----------------------------------------------------------
Global Insolvency reports that the Irish government will seek EU
funding to help businesses affected by the UK's departure from the
union, the Taoiseach said on Feb. 15, in a major speech on the
Coalition's Brexit policy.

Speaking at an Institute of International and European Affairs
event at the Mansion House in Dublin, the Taoiseach said that
"stabilization and adjustment measures" for the businesses most
affected by Brexit will be funded by the Government, Global
Insolvency relays, citing the Irish Times.  He said support for
these measures will be sought from Brussels, Global Insolvency
notes.

According to Global Insolvency, in a wide-ranging speech,
Mr. Kenny said that Brexit poses "unprecedented political,
economic and diplomatic challenges for Ireland" and warned that
the negotiations on the UK's exit will be "the most important
negotiations in our history as an independent state."



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


SAMRUK-ENERGY JSC: Fitch Affirms 'BB+' LT Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has affirmed Kazakhstan-based JSC Samruk-Energy's
Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB+',
and foreign-currency senior unsecured rating at 'BB'. The Outlooks
on the IDRs are Stable.

The affirmation reflects continued strong strategic and
operational ties between the company the Kazakh state and Fitch
expectations that the company would refinance its USD500 million
Eurobonds falling due in December 2017 or the government would
provide timely financial support to Samruk-Energy, in case of
insufficient cash inflows.

Fitch views Samruk-Energy's liquidity at end-2016 as mostly
dependent on the credit facilities to fully cover the forthcoming
Eurobond repayment and failure by the company to secure
refinancing may result in negative rating action. Samruk-Energy's
standalone profile remains weak due to a heavy debt burden and
high exposure to FX.

KEY RATING DRIVERS

Eurobond Repayment: Samruk-Energy's cash and deposits of KZT57.4
billion (KZT32.4 billion of which is held at holding level) at
end-2016, together with available credit facilities and
privatisation proceeds, are sufficient to cover short-term
repayments of KZT193 billion, including KZT167 billion (USD500
million) of maturing Eurobonds at holding level.

The company has committed credit facilities at holding level from
EBRD of KZT35 billion or EUR100 million, as well as uncommitted
credit lines from several local banks totalling KZT104 billion.
Samruk-Energy also expects privatisation proceeds of KZT40.5
billion and has already received bids for most of this amount.

We expect the Kazakh state to support the company in case cash
inflows are insufficient. Samruk-Kazyna plans to issue a comfort
letter stipulating the ability to provide Samruk-Energy funds in
the form of equity injection or a loan at subsidised interest
rates.

Standalone Profile Remains Weak: Fitch views Samruk-Energy's
standalone profile as weak and commensurate with the mid 'B'
rating category, significantly below the government-supported IDR.
The credit profile is constrained by weak credit metrics, high
exposure to FX and by the operating and regulatory environment in
Kazakhstan. Fitch expects Samruk-Energy's funds from operations
(FFO) adjusted gross leverage to remain on average at around 6.0x
in 2017-2020, and its FFO fixed charge cover to average around
2.5x in 2017-2020.

Tight Covenants: The company's debt/EBITDA covenant set in the
loan agreement with the EBRD is tight due to Samruk-Energy's weak
financials. The covenant is currently set at 4.5x and Samruk-
Energy had already received a waiver for 2016. Fitch expects
covenant pressure to persist in the following years. This will be
more reflective of the company's standalone mid 'B' category
profile. Failure to obtain a waiver or revise the covenant may
lead to a multi-notch downgrade of ratings.

Privatisation Impact on Leverage Neutral: At end-2016 Samruk-
Energy announced a tender for the sale of its power distribution
assets, ie, MEDNC (BB/Negative) and VK REK including supply
company Shygysenergotrade, Aktobe CHP power plant and greenfield
gas producer Tegis Munay for the total initial price of at least
KZT40.5 billion.

Samruk-Energy has received bids for MEDNC, VK REK and Aktobe CHP.
At end-September 2016 these subsidiaries accounted for 3% of
Samruk-Energy's debt and 10% of the company's EBITDA. Fitch rating
case envisages the privatisation of MEDNC, VK REK and Aktobe CHP
in 2017. After deconsolidating debt of disposed companies and
accounting for privatisation proceeds, Fitch expects the leverage
impact will be neutral.

Top-Down Approach: Fitch continues to view the operational and
strategic links between Samruk-Energy and the state as strong,
which supports the application of Fitch top-down rating approach.
The strength of the ties is underpinned by the company's strategic
importance to the Kazakh economy as the company controls about 40%
of total installed electricity generation capacity and 36% of
total coal output in the country. On the other hand, Samruk-Energy
has weaker strategic and operational ties with the state than JSC
National Company KazMunayGas (BBB-/Stable) and JSC National
Company Kazakhstan Temir Zholy (BBB-/Stable), and has less
guaranteed debt than KEGOC (BBB-/Stable). Therefore, a difference
of two notches is deemed appropriate.

Continued State Support: The government demonstrated its support
through equity injections of around KZT18 billion in 2016 and
through lowering the interest rate in 2015 on Samruk-Kazyna's
KZT100 billion loan to 1% from 9%. Failure to support Eurobond
repayment, if needed, may lead us to revise Fitch approach to
bottom-up and may lead to a multi-notch downgrade.

DERIVATION SUMMARY
Samruk-Energy's closest peers are Kazakhstan-based regional
players Joint Stock Company Central-Asian Electric-Power
Corporation (CAEPCo, B+/Stable) and Kazakhstan Utility Systems
(KUS, BB-/Stable) and Russian-based Inter RAO (BBB-/Stable), the
latter also consolidated state-owned assets in the past. Samruk-
Energy and its peers are subject to regulatory uncertainties
influenced by macroeconomic shocks and possible political
interference. CAEPCo and KUS are rated on a standalone basis, and
Inter RAO is 'BB+' standalone plus one-notch uplift for state
support. Samruk-Energy's standalone profile is in the mid 'B'
category due to a heavy debt burden and high exposure to FX.
Samruk-Energy's strong operational and strategic links with the
government justify a top-down approach.

KEY ASSUMPTIONS

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

- 0% tariff growth in electricity generation for 2017-2018 and
   3% growth thereafter;
- Electricity production to increase at 2% in 2017 and 3%
   thereafter, in line with GDP growth rate;
- Inflation-driven cost increase (including coal);
- Privatisation of MEDNC, VK REK and Aktobe CHP; privatisation
   of Tegis Munay not considered;
- 30% dividend payout ratio;
- Average capex of KZT60 billion over 2017-2020, above
   management's guidance.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action

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

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action

- Negative sovereign rating action.
- Fitch may consider changing the rating approach to bottom-up
   in case of diminishing or irregular state support, which may
    result in further deterioration of the company's credit
    profile, tight liquidity position and failure of timely debt
    repayments.

LIQUIDITY AND DEBT STRUCTURE
High Prior Ranking Debt: The ratio of secured and prior-ranking
debt at operating company level is estimated at 2.0x of trailing
9M2016 EBITDA. Fitch forecasts that it would have exceeded Fitch's
threshold of 2x at end-2016. This, along with uncertainties
regarding planned asset disposals and lack of clarity and
consistency in group debt management, leads to notching the
foreign-currency senior unsecured rating down by one level from
Samruk-Energy's Long-Term Foreign-Currency IDR.

FX, Local Banks Exposure: Samruk-Energy is exposed to currency
risk as about 60% of the company's KZT387billion debt at end-2016
was in foreign currencies (USD) while all revenue is generated in
tenge. The company does not use hedging, and the currency mismatch
risk is only partly mitigated by holding KZT36billion of USD-
denominated cash and bank deposits. The vulnerability to FX
fluctuations will be lower by end-2017 as the majority of
refinancing sources currently considered by the company are tenge-
denominated. The cash and deposits are mostly kept in local banks,
including Halyk Bank of Kazakhstan (BB/Stable), Tsesnabank
(B/Stable), etc.

FULL LIST OF RATING ACTIONS

Long-Term Foreign and Local Currency IDR affirmed at 'BB+';
Outlook Stable

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

National Long-Term Rating affirmed at 'AA(kaz)'; Outlook Stable

Foreign and local currency senior unsecured rating affirmed at
'BB'

National senior unsecured rating affirmed at 'AA-(kaz)'



===================
L U X E M B O U R G
===================


ARCELORMITTAL: Egan-Jones Hikes Sr. Unsecured Ratings to B+
-----------------------------------------------------------
Egan-Jones Ratings, on Jan. 23, 2017, raised the senior unsecured
ratings on debt issued by ArcelorMittal to B+ from B.

ArcelorMittal S.A. is a Luxembourg-based multinational steel
manufacturing corporation headquartered in Boulevard d'Avranches,
Luxembourg. It was formed in 2006 from the takeover and merger of
Arcelor by Mittal Steel.


INTELSAT SA: Egan-Jones Lowers Sr. Unsecured Ratings to CCC
-----------------------------------------------------------
Egan-Jones Ratings, on Jan. 25, 2017, downgraded the senior
unsecured debt ratings on debt issued by Intelsat SA to CCC from
CCC+.

Headquartered in Luxembourg, Intelsat S.A. is a satellite
services company that provides diversified communications
services to the world's leading media companies, fixed and
wireless telecommunications operators, data networking service
providers for enterprise and mobile applications, multinational
corporations and Internet service providers.



=====================
N E T H E R L A N D S
=====================


CARLYLE GLOBAL: Moody's Assigns B2 Rating to Cl. E-R Sr. Notes
--------------------------------------------------------------
Moody's Investors Service has assigned definitive ratings to six
classes of debts issued by Carlyle Global Market Strategies Euro
CLO 2013-1 B.V.:

-- EUR236,000,000 Class A-1-R Senior Secured Floating Rate Notes
due 2030, Definitive Rating Assigned Aaa (sf)

-- EUR56,000,000 Class A-2-R Senior Secured Floating Rate Notes
due 2030, Definitive Rating Assigned Aa2 (sf)

-- EUR24,000,000 Class B-R Senior Secured Deferrable Floating
Rate Notes due 2030, Definitive Rating Assigned A2 (sf)

-- EUR23,000,000 Class C-R Senior Secured Deferrable Floating
Rate Notes due 2030, Definitive Rating Assigned Baa2 (sf)

-- EUR20,000,000 Class D-R Senior Secured Deferrable Floating
Rate Notes due 2030, Definitive Rating Assigned Ba2 (sf)

-- EUR10,000,000 Class E-R Senior Secured Deferrable Floating
Rate Notes due 2030, Definitive Rating Assigned B2 (sf)

RATINGS RATIONALE

Moody's definitive ratings of the rated notes address 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, CELF Advisors LLP ("CELF Advisors") has
sufficient experience and operational capacity and is capable of
managing this CLO.

The Issuer issued the Refinancing Notes in connection with the
refinancing of the following classes of notes: Class A Notes,
Class B-1 Notes, Class B-2 Notes, Class C-1 Notes, Class C-2
Notes, Class D-1 Notes, Class D-2 Notes and Class E Notes due 2025
(the "Original Notes"), previously issued June 2013 (the "Original
Closing Date"). Moody's did not rate the Original Notes. On the
Refinancing Date, which is also a payment date, the Issuer will
use the proceeds from the issuance of the Refinancing Notes to
redeem in full its respective Original Notes. On the Original
Closing Date, the Issuer also issued the Class S-1 and Class S-2
Subordinated Notes, which will remain outstanding.

CGMSE 2013-1 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
senior loans, second-lien loans, mezzanine obligations and high
yield bonds. The portfolio is expected to be at least 81% ramped
up as of the closing date and to be comprised predominantly of
corporate loans to obligors domiciled in Western Europe. The
remaining of the portfolio will be acquired during the 4 month
ramp-up period.

CELF Advisors 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 six classes of notes rated by Moody's and the
Class S-1 and Class S-2 Subordinated Notes, the Issuer issued EUR
4,200,000 of Class S-3 Subordinated Notes which is 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 ratings:

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. CELF Advisors' investment decisions and
management of the transaction will also affect the notes'
performance.

Loss and Cash Flow Analysis:

Moody's modelled 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 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 modelling assumptions:

Par Amount: EUR 400,000,000

Diversity Score: 42

Weighted Average Rating Factor (WARF): 2850

Weighted Average Spread (WAS): 3.80%

Weighted Average Coupon (WAC): 6.0%

Weighted Average Recovery Rate (WARR): 44.5%

Weighted Average Life (WAL): 8 years

Stress Scenarios:

Together with the set of modelling 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-R Senior Secured Floating Rate Notes due 2030: 0

Class A-2-R Senior Secured Floating Rate Notes due
2030: -1

Class B-R Senior Secured Deferrable Floating Rate Notes due
2030: -2

Class C-R Senior Secured Deferrable Floating Rate Notes due
2030: -2

Class D-R Senior Secured Deferrable Floating Rate Notes due
2030: -1

Class E-R Senior Secured Deferrable Floating Rate Notes due
2030: 0

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

Ratings Impact in Rating Notches:

Class A-1-R Senior Secured Floating Rate Notes due 2030: -0

Class A-2-R Senior Secured Floating Rate Notes due 2030: -3

Class B-R Senior Secured Deferrable Floating Rate Notes due
2030: -3

Class C-R Senior Secured Deferrable Floating Rate Notes due
2030: -3

Class D-R Senior Secured Deferrable Floating Rate Notes due
2030: -1

Class E-R Senior Secured Deferrable Floating Rate Notes due
2030: -1

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.


DRYDEN 39 EURO: S&P Affirms 'B-' Rating on Class F Notes
--------------------------------------------------------
S&P Global Ratings affirmed its credit ratings on Dryden 39 Euro
CLO 2015 B.V.'s class A to F notes.

The affirmations follow S&P's assessment of the transaction's
performance using data from the latest trustee report available
and the application of its relevant criteria.

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, the current weighted-average
spread, and the weighted-average recovery rates calculated in line
with S&P's corporate collateralized debt obligation (CDO)
criteria.  S&P applied various cash flow stresses, using its
standard default patterns, in conjunction with different interest
rate stress scenarios.

Since S&P's effective date analysis in April 2016, the aggregate
collateral balance has increased by about EUR3.7 million.  In
S&P's view, this has increased the available credit enhancement
for all of the rated classes of notes.  Currently there are no
defaulted assets in the portfolio.

Taking into account the results of S&P's credit and cash flow
analysis, it considers that the available credit enhancement for
all classes of notes is commensurate with the currently assigned
ratings.  S&P has therefore affirmed its ratings on all classes of
notes.

Dryden 39 Euro CLO 2015 is a European cash flow corporate loan CLO
securitization of a revolving pool, comprising primarily euro-
denominated senior secured loans and bonds granted to broadly
syndicated corporate borrowers.

RATINGS LIST

Class     Rating

Dryden 39 Euro CLO 2015 B.V.
EUR415.115 Million Floating- And Fixed-Rate Notes (Including
EUR42.50 Million Subordinated Notes)

Ratings Affirmed

A-1       AAA (sf)
A-2       AAA (sf)
B-1       AA (sf)
B-2       AA (sf)
C-1       A (sf)
C-2       A (sf)
D         BBB (sf)
E         BB (sf)
F         B- (sf)



===============
P O R T U G A L
===============


METROPOLITANO DE LISBOA: S&P Affirms 'BB+' ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' long-term issuer credit
rating on Portuguese subway operator Metropolitano de Lisboa, E.P.
(Metro).  The outlook is stable.

S&P equalizes its long-term rating on Metro with that on Portugal,
based on S&P's view of the almost certain likelihood that Metro
would receive timely and sufficient extraordinary support from the
Portuguese government in the event of financial distress.

S&P regards Metro as a government-related entity (GRE).  S&P bases
its assessment of the likelihood of government support on S&P's
view of Metro's critical role for and integral link with Portugal,
the company's 100% owner.

S&P considers Metro's role for Portugal is critical because the
company is vital to implementing the government's policy of
fostering urban mobility in the capital city of Lisbon.  The
government has also guaranteed Metro's debt, which contains cross-
default clauses regarding all of the company's financial
obligations.  Furthermore, S&P considers that the Portuguese
government's level of contingent liabilities would not constrain
its capacity and willingness to support Metro in a timely manner
if it were in financial distress.  More generally, S&P do not
doubt the government's general propensity to support the GRE
sector.

Since June 2011, the government has enabled timely payment of
Metro's financial obligations through what S&P sees as sufficient,
continuing, and well-coordinated extraordinary support.  The
government has also set up a legal framework and secured
sufficient budgetary allocations to facilitate the provision of
this support on a timely basis.  This track record of active
support leads S&P to consider that a default by Metro would have a
pronounced impact on the government, and it underscores Metro's
critical role for the government.

S&P thinks that Metro has an integral link with the government.
S&P continues to see Metro as an extension of the Portuguese
government, in charge of managing and enlarging the subway network
in the Lisbon area, in strict accordance with government plans.

Metro builds and operates under a strategy defined and monitored
by the government.  As an "entidade publica empresarial" (EP;
public enterprise entity), Metro enjoys a stronger legal status
than "sociedades anonimas" (public limited companies).  Even
though EPs are generally subject to private law (to gain
flexibility and efficiency), they are not subject to the
bankruptcy laws applicable to sociedades anonimas.  Only the
central government can liquidate an EP.

Metro cannot be privatized unless its legal status is changed.
That said, in 2015, the Portuguese government tendered out Metro's
operations to a private contractor, while retaining responsibility
for the company's debt.  Had it been carried out, this plan would
have turned Metro into a debt holding company and contract
manager, with no direct responsibility for managing operations.
In the event, the Portuguese government cancelled the concession
and retained control over Metro's operations.

All of Metro's debt falls under the central government's
consolidation scope, under European System of National and
Regional Accounts (ESA 2010) rules.  In S&P's view, the central
government remains committed to servicing Metro's debt, given the
outstanding government guarantee on all of its debt.

S&P assess Metro's stand-alone credit profile (SACP) at 'cc'.  S&P
assigns a 'cc' SACP to an issuer when we consider default to be a
virtual certainty unless the issuer receives extraordinary support
from a parent or government.  In Metro's case, S&P classifies
government support to the company as extraordinary because timely
payment of debt service relies on government loans and transfers
that are included in each annual budget, rather than contemplated
in a stable, multiyear financial framework of ongoing support.

The 'cc' SACP stems from our assessment that Metro lacks the
capacity to generate cash flow commensurate with its debt service
requirements.  S&P understands Metro generated free cash flow of
about EUR8 million in 2016, and that its debt service was about
EUR357 million.  Metro is not allowed to sign credit lines or
issue new debt in the capital markets.  Therefore, in the absence
of government support, S&P considers that default would be
certain.

Metro has signed a contract with the central government giving the
treasury the mandate to manage the company's derivatives.  The
treasury ultimately meets the swap payments.  In 2013, the
treasury agreed with swap counterparties to cancel some contracts.
S&P understands that the government intends to renegotiate the
remaining swaps.  S&P sees these agreements and renegotiations as
opportunistic; they have no impact on S&P's rating on Metro.
According to S&P's understanding, ongoing disputes in the English
courts regarding four swap contracts can be described as "bona
fide".  S&P understands that, despite an unfavorable ruling in
December 2016, the Portuguese government has not yet exhausted all
legal avenues available to contest these contracts.

The stable outlook on Metro reflects that on Portugal.  S&P
expects its long-term issuer credit rating on Metro to move in
tandem with S&P's long-term rating on Portugal.

Although highly unlikely at this stage, S&P could downgrade Metro
if S&P revised downward its view of the likelihood of
extraordinary support from the Portuguese government.  This is
mostly likely to happen if S&P considers that the Portuguese
government's commitment to supporting Metro's debt service through
timely and sufficient capital injections has diminished.

S&P could also downgrade Metro if S&P believed that, having
exhausted all legal avenues with regards to the ongoing disputes
about its swap contracts, the company had failed to comply with
the terms of a final court ruling.



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


CB IMONEYBANK: Liabilities Exceed Assets, Assessment Shows
----------------------------------------------------------
During the inspection of financial standing of LLC CB IMoneyBank,
the provisional administration of the credit institution,
appointed by Bank of Russia Order No. OD-3415, dated October 5,
2016, due to the revocation of its banking license, revealed a low
quality of the bank's loan portfolio resulting from extending
loans to shell companies totalling about RUR0.9 billion, according
to the press service of the Central Bank of Russia.

Besides, the provisional administration identified transactions
aimed at imitating the servicing of households' loans worth over
RUR3.9 billion.

According to the provisional administration estimates, the asset
value of LLC CB IMoneyBank does not exceed RUR8.2 billion, while
its liabilities to creditors amount to RUR22.3 billion, including
RUR21.3 billion of liabilities to individuals.

On January 19, 2017, the Court of Arbitration of the city of
Moscow took a decision to recognise LLC CB IMoneyBank bankrupt
with the state corporation Deposit Insurance Agency appointed as a
receiver.

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


PROMENERGOBANK JSC: Liabilities Exceed Assets, Assessment Shows
---------------------------------------------------------------
During the inspection of financial standing of JSC Promenergobank,
the provisional administration of the credit institution,
appointed by Bank of Russia Order No. OD-2525, dated August 5,
2016, due to the revocation of its banking license, revealed the
signs of moving out assets through extending loans by the former
management and owners of the bank to borrowers incapable of
honouring their liabilities in the total amount of over RUR2.4
billion, according to the press service of the Central Bank of
Russia.

Besides, when the bank experienced solvency problems, it carried
out operations bearing evidence of preferential honouring of
liabilities to certain creditors to the detriment of others.

According to the provisional administration estimates, the asset
value of JSC Promenergobank does not exceed RUR1.6 billion, while
its liabilities to creditors amount to RUR2.5 billion, including
over RUR2 billion of liabilities to individuals.

On October 19, 2016, the Court of Arbitration of the Vologda
Region took a decision to recognise JSC Promenergobank insolvent
(bankrupt) with the state corporation Deposit Insurance Agency
appointed as a receiver.

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


TRANSFIN-M OJSC: S&P Revises Outlook to Stable & Affirms B Rating
-----------------------------------------------------------------
&P Global Ratings revised its outlook on Russia-based financial
leasing Company OJSC TransFin-M to stable from negative.  At the
same time, S&P affirmed its 'B' long-term counterparty credit
rating on the company.

S&P also raised its short-term counterparty credit rating on
TransFin-M to 'B' from 'C'.  S&P raised its long-term Russia
national scale rating on the company to 'ruA-' from 'ruBBB+'.

The rating actions reflect S&P's view that despite the continued
tough operating environment for leasing companies in Russia,
TransFin-M has shown more resilience to adverse market conditions
than S&P initially envisaged.  This results from its experienced
management; better asset quality than other rated leasing
companies, with no nonperforming loans as of Sept. 30, 2016; and
continued funding support from its ultimate shareholder.
Therefore, S&P now considers that the risk of deterioration of the
financial profile, which had underpinned our previously negative
outlook on the company, is receding.

TransFin-M's aggregate amount of repossessed and nonperforming
assets (the amount of net finance lease receivables on rescinded
contracts) equaled 2.3% of total assets as of Sept. 30, 2016,
(versus its peers' average of 9.5%), compared with 8.6% at the
beginning of the year.  S&P do not expect any significant asset
quality deterioration over the next 12-18 months, based on S&P's
view of gradually improving business prospects in the railway
transportation sector, with tariff increase that should support
incoming cash flows from leaseholders and ultimately stable
returns on the company's assets (above 1%).  In addition, S&P
anticipates an only moderate increase in net investments in
leasing.

The railway sector represents 86% of TransFin-M's leasing
portfolio, with the top-20 exposures together comprising almost
100% of the portfolio as of end-September 2016.  Although
TransFin-M aims to diversify its business, S&P believes that
concentration risk will likely remain and continue to be one of
the main constraints on the ratings over the next year.

Currently, S&P anticipates leasing portfolio growth of about 10%
over the next two years and expect Russian ruble (RUB)10 billion
(US$167 million) convertible bonds issued over 2014-2016 will
support TransFin-M's capitalization.  S&P thinks that the optional
conversion feature of these bonds provides TransFin-M with loss-
absorption capacity, as long as it remains a going concern, which
is consistent with S&P's assignment of intermediate equity content
to these instruments.  Therefore, S&P includes the bonds in its
calculation of total adjusted capital, up an amount equating to
33% of TransFin-M's consolidated adjusted common equity.  S&P
consequently projects its risk-adjusted capital (RAC) ratio for
TransFin-M will be 6.6%-7.0% over the next 12-18 months.

In S&P's view, TransFin-M's funding profile benefits from ongoing
shareholder support, and S&P do not expect this to change.  The
good funding position supports TransFin-M's business performance,
and the company can easily manage its liquidity.  Total funding
from shareholders accounted for about 50% of TransFin-M's total
funding as of end-September 2016, with repayments beyond 2019.

TransFin-M's stable funding ratio has exceeded 80% over the past
four years and stood at 98% at end-September 2016, based on
quantitative metrics.  At the same time, S&P notes that the
company adequately balances the maturity of its assets and
liabilities, effectively managing its liquidity gap.  In S&P's
view, TransFin-M generates enough cash inflows to cover interest
payments and other costs on a monthly basis in S&P's base-case
scenario.  S&P's cash flow analysis shows that TransFin-M's
minimum liquidity coverage indicator over a one-year horizon is
2.0x.  S&P's overall assessment is also supported by the
availability of liquidity support from the shareholders.  S&P
considers the shareholders as supportive of the company's
creditworthiness.  The one-notch positive adjustment S&P factors
into its rating on TransFin-M reflects the tangible ongoing
benefits from the company's current ownership, compared with peers
without a supportive shareholder.  These benefits translate into
some structurally stronger metrics and, above all, greater
predictability and resilience of the business and financial
profiles, especially in stressed times.

The stable outlook on TransFin-M reflects S&P's view that in the
next 12 months the company will withstand the still-negative,
albeit gradually easing, economic trends in Russia, while
maintaining its good asset quality and overall credit profile.

S&P could consider a negative rating action in the next 12-18
months if it anticipated that TransFin-M's capitalization was
going to weaken in the coming 12 months, with S&P's anticipated
RAC ratio decreasing below 5%.  This could happen if TransFin-M
shows significantly higher in leases and total assets without
similar profit growth or capital injections.  Additionally, S&P
could consider a downgrade if TransFin-M stops receiving ongoing
support from its main shareholder, putting pressure on the
company's funding and liquidity positions.

A positive rating action is currently a remote possibility given
the inherent concentration risks to TransFin-M's business model
and its lease portfolio.


WESTINTERBANK LLC: Liabilities Exceed Assets, Assessment Shows
--------------------------------------------------------------
During the inspection of financial standing of LLC Westinterbank,
the provisional administration of the credit institution,
appointed by Bank of Russia Order No. OD-3672, dated October 27,
2016, due to the revocation of its banking license, revealed a low
quality of the bank's loan portfolio resulting from extending
loans to shell companies, according to the press service of the
Central Bank of Russia.

Besides, the provisional administration identified transactions of
moving out liquid assets from the insolvent bank and replacing
them with a non-liquid property, as well as operations of
withdrawing assets through giving out cash to a stakeholder from
the till and transferring funds from its current accounts in the
bank to another credit institution.

According to the provisional administration estimates, the asset
value of LLC Westinterbank does not exceed RUR150.6 million, while
its liabilities to creditors amount to RUR536.9 million, including
RUR500 million of liabilities to individuals.

On December 19, 2016, the Court of Arbitration of the city of
Moscow took a decision to recognise LLC Westinterbank bankrupt
with the state corporation Deposit Insurance Agency appointed as a
receiver.

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



===========
S E R B I A
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SERBIA: Must Stop Financing Unprofitable State Firms, IMF Says
--------------------------------------------------------------
Gordana Filipovic at Bloomberg News reports that Sebastian Sosa,
the local head of the International Monetary Fund, said Serbia
needs to stop subsidizing unprofitable state companies to lock in
progress the largest former Yugoslav republic has made in cutting
the budget, staunching one of the largest drains on state coffers.

"Fiscal costs from loss-making state-owned enterprises need to be
plugged," Bloomberg quotes Mr. Sosa as saying in an Belgrade
interview on Feb. 14, ahead of the IMF's staff visit that starts
on Feb. 27 and runs through March 6.

Prime Minister Aleksandar Vucic promised the IMF to restructure,
close or sell hundreds of money-losing companies that robbed the
budget of as much as US$1 billion a year, Bloomberg relates.  The
list includes coal miner JP PEU Resavica, the Rudarsko-
topionicarski basen Bor copper miner, and chemical producers
Azotara doo and Metanolsko Sircetni Kompleks MSK, Bloomberg
discloses.

Serbia needs to "stop with subsidies, debt repayment, financing
these companies through arrears for electricity or gas, or arrears
for social security payments" and find "a permanent solution,"
Bloomberg quotes Mr. Sosa as saying.

Ms. Sosa, as cited by Bloomberg, said the IMF mission will study
budget spending and how that will affect this year's fiscal
outlook.



=========
S P A I N
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BANCO POPULAR: Fitch Lowers LT IDR to B+, Outlook Revolving
-----------------------------------------------------------
Fitch Ratings has downgraded Banco Popular Espanol S.A.'s
Long-Term Issuer Default Rating (IDR) to 'B+' from 'BB-' and its
Viability Rating (VR) to 'b+' from 'bb-'. The Outlook is Evolving.

The downgrades reflect worse than expected losses and the
recognition of sizeable additional problem assets in 2016. As a
result the bank's asset quality and capitalisation metrics have
deteriorated significantly leaving only a modest margin to absorb
any unexpected losses. Fitch believes that a revision of the
bank's strategic plan is likely to follow the appointment of the
new chairman in February 2017.

However, Fitch believes the bank's weakened balance sheet, with a
very high stock of net problem assets and coverage levels that are
still below levels originally anticipated by the bank and those of
peers, represents a substantial strategic challenge for the
incoming chairman at a time when other banks are also under
regulatory and investor pressure to accelerate disposals of
problem assets. Of note, net problem assets are far higher than
Fitch had previously anticipated at this stage of the bank's
strategic plan and above peers rated in the 'bb' range. In the
context of its high net non-performing assets, Popular's fully
loaded common equity Tier 1 (CET1) ratio of just 8.2% is also
weaker than peers.

KEY RATING DRIVERS
IDRS, VR AND SENIOR DEBT
Popular's Long-Term IDRs and senior debt ratings are driven by the
bank's standalone creditworthiness, as captured by the VR. Asset
quality and capital have high influence on the VR, which reflects
the bank's very weak asset quality metrics undermined by its large
problematic exposure to real estate developers and its thin
capital buffers relative to peers. The VR also factors in the
bank's stable retail-based funding profile, which has moderate
influence on the rating.

Popular's asset quality indicators are the weakest among rated
Spanish banks. The stock of problem assets (NPLs and net
foreclosed assets) totalled EUR29.2bn and accounted for a very
high 27% of gross loans and foreclosures at end-2016. The reserve
coverage for problem assets increased following the large
impairment charges booked in 4Q16 but remained slightly below
domestic peers at around 45% at end-2016. Apart from loan and
foreclosed asset impairment charges Popular also had several
negative one-off items in 2016, including provisions to cover the
full retroactivity of interest rate floor clauses, restructuring
costs and goodwill impairments.

These one-offs meant the bank reported a net loss of EUR3.5bn in
2016, exceeding the EUR2.5bn capital increase the bank completed
in June 2016. The bank's fully loaded CET1 ratio fell to a low
8.2% and net problem assets accounted for 3.7x fully loaded CET1
at end-2016. Although the bank currently meets regulatory capital
requirements, Fitch believes its solvency is highly vulnerable to
further asset quality shocks.

Popular's profitability is undermined by its large exposure to the
real estate and construction sectors. Excluding these, the bank's
core SME banking business remains resilient amid the low interest
rate and volume environment thanks to its strong nationwide
franchise. Nonetheless, pre-provision earnings fell in 2016 due to
lower net interest income and trading gains. The bank's recent
cost-cutting measures, which included a voluntary exit scheme and
the closure of branches, will improve operating efficiency.

The bank's funding profile is underpinned by its retail deposit
base. At end-2016 the gross loans/deposits ratios was 125% and
available liquidity buffers were acceptable in light of upcoming
wholesale debt maturities. The bank reported a regulatory
liquidity coverage ratio of 135% at end-2016.

The 'RR4' Recovery Rating reflects average recovery assumptions
for senior debt.

SUPPORT RATING AND SUPPORT RATING FLOOR
Popular's Support Rating (SR) of '5' and Support Rating Floor
(SRF) of 'No Floor' reflect Fitch's belief that senior creditors
can no longer rely on receiving full extraordinary support from
the sovereign in the event that the bank becomes non-viable.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
Popular's subordinated (lower Tier 2) debt issues are rated one
notch below the bank's VR to reflect the below-average loss
severity of this type of debt compared with average recoveries.
Popular's preferred stock and additional tier 1 high trigger
contingent convertible perpetual preferred securities are rated
three notches below the bank's VR to reflect the higher loss
severity risk of these securities (two notches) compared with
average recoveries as well as moderate incremental risk of non-
performance relative to its VR (one notch).

RATING SENSITIVITIES
IDRS, VR AND SENIOR DEBT
The Evolving Outlook reflects Fitch's opinion that there are both
positive and negative trends that could affect the rating. A
decisive new strategy to strengthen capital and accelerate the
reduction of non-performing loans could, over time, lead to an
upgrade of the VR and Long-Term IDR if complemented by an extended
track record of profit generation and more positive ongoing asset
quality dynamics (loan impairment charge rates, non-performing
loan and foreclosed asset flows). Conversely, Popular's VR and
Long-Term IDR could be downgraded if its weakened balance sheet
impedes its plans to reduce non-performing assets at a time when
other banks are also looking to reduce problem assets and the low
interest rate environment and intense competition is likely to
maintain pressure on pre-provision earnings. The long-term senior
debt ratings are additionally sensitive to changes in recovery
expectations.

SR AND SRF
An upgrade of the SR and upward revision of the SRF would be
contingent on a positive change in the sovereign's propensity to
support the senior creditors of bank. This is highly unlikely, in
Fitch's view.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
These ratings are primarily sensitive to changes in Popular's VR.

Fitch has taken the following rating actions:

Popular:

Long-Term IDR: downgraded to 'B+' from 'BB-', Outlook Evolving

Short-Term IDR: affirmed at 'B'

Viability Rating: downgraded to 'b+' from 'bb-'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'NF'

Long-term senior unsecured debt programme: downgraded to
'B+'/RR4 from 'BB-'

Short-term senior unsecured debt programme and commercial paper:
affirmed at 'B'

Subordinated lower Tier 2 debt: downgraded to 'B'/RR5 from 'B+'

Preferred Stock: downgraded to 'CCC'/RR6 from 'B-

BPE Financiaciones S.A.:

Long-term senior unsecured debt and debt programme (guaranteed
by Popular): downgraded to 'B+'/RR4 from 'BB-'

Short-term senior unsecured debt programme (guaranteed by
Popular): affirmed at 'B'

Popular Capital, S.A.:

Preference shares: downgraded to 'CCC'/RR6 from 'B-'


BANKIA SA: Fitch Affirms BB+ Subordinated Debt Rating
-----------------------------------------------------
Fitch Ratings has affirmed Bankia, S.A.'s Long-Term Issuer Default
Rating (IDR) at 'BBB-' and parent company, BFA, Tenedora de
Acciones, S.A.U.'s (BFA) Long-Term IDR at 'BB+'. Their Outlooks
are Stable.

KEY RATING DRIVERS
IDRS, VR AND SENIOR DEBT
Bankia
The IDRs of Bankia are driven by its standalone strength as
expressed by its Viability Rating (VR). The VR reflects the bank's
turnaround since recapitalisation, led by experienced management,
a large national retail franchise, average risk appetite,
strengthened capitalisation and internal capital generation, as
well as an improved funding and liquidity profile. The VR also
reflects its weak, albeit improving, asset quality indicators and
lower earnings diversification than peers.

Bankia's problem assets (non-performing loans (NPLs) and
foreclosed assets) declined 13% in 2016, due to lower NPL entries
and asset sales, and the ratio of problem assets/loans and
foreclosed assets improved to 11.5% at end-2016 from 12.5% a year
ago. This ratio remains high for the rating, but Fitch assessment
of asset quality also considers the bank's adequate NPL reserve
coverage (around 55%), a supportive domestic operating environment
and the bank's commitment to actively manage down problem assets.

Capitalisation has improved steadily in recent years, with Bankia
reporting a fully loaded common equity tier 1 ratio of 13% at end-
2016. In Fitch assessment of capital, Fitch believes that Bankia
will likely operate with a somewhat lower CET1 capital ratio in
future, and that excess capital could be used to acquire Banco
Mare Nostrum or be returned to shareholders and replaced by hybrid
capital instruments. Fitch nevertheless believe that the bank's
solvency will be maintained at a level commensurate with an
investment-grade rating, including capital exposure to unreserved
problem assets at below 100% of fully loaded CET1 (70% at end-
2016).

The bank's profitability is supported by good cost efficiency and
much reduced loan impairment charges (LICs), partly mitigating
revenue pressure from low interest rates and competition. Revenue
generation is largely derived from net interest income, reflecting
Bankia's retail nature, but this has a larger contribution from
interest earned on securities than peers. The bank is gradually
expanding its business in SMEs and consumer lending, increasing
cross-selling and reducing deposit costs to support its banking
earnings, but Fitch would look for further improvements to be
accompanied by higher banking activity.

Bankia's funding and liquidity profile continued to improve in
2016, benefiting from loan shrinkage and steady growth in
deposits, which enhanced the bank's loan-to-deposit ratio to 111%
at end-2016 from 121% at end-2015. Customer deposits are the
bank's main funding source, representing about 60% of total
funding. The rest is largely secured in the form of covered bonds,
ECB's TLTRO or repos, which are used to fund a large stock of
legacy debt securities. Liquidity reserves are adequate for
scheduled debt repayments.

BFA
BFA is wholly owned by Spain's Fund for Orderly Bank Restructuring
(FROB), and it retained a 65.9% controlling stake in Bankia at
end-2016.

BFA's IDRs and senior debt ratings are based on the institution's
VR, which is in turn driven by the VR of Bankia as the latter is
one of BFA's principal assets, representing about 36% of BFA's
unconsolidated balance-sheet at end-1H16. The other large item on
BFA's balance sheet is Spanish sovereign bond holdings. BFA's VR
is notched down once from Bankia's to reflect Fitch's belief that
BFA's strategy is to gradually reduce its majority ownership,
although the timing is uncertain as there is no deadline set out
in its restructuring plan. BFA's VR also reflects low double
leverage of 86% at end-1H16 and manageable indebtedness given the
institution's stock of unencumbered assets.

As part of the group's restructuring process, BFA surrendered its
banking license in early 2015, but remains the group's
consolidating entity and is supervised by the banking authorities
on a consolidated basis given its stake in Bankia. BFA's fully
loaded CET1 ratio was 13.7% at end-1H16.

SUPPORT RATING AND SUPPORT RATING FLOOR
Bankia's and BFA's Support Rating (SR) of '5' and Support Rating
Floor (SRF) of 'No Floor' reflect Fitch's belief that senior
creditors can no longer rely on receiving full extraordinary
support from the sovereign in the event that they become non-
viable. For BFA, Fitch also takes into account its role as holding
company.

SUBORDINATED DEBT
Bankia's subordinated (lower Tier 2) debt issue is rated one notch
below its VR to reflect the below-average loss severity of this
type of debt.

RATING SENSITIVITIES
IDRS, VR AND SENIOR DEBT
Bankia
Upside could arise in the medium term from further improvement in
asset quality, combined with further strengthening of
profitability. These factors will ultimately support Bankia's
capitalisation, either through internal capital generation or
reduced capital at risk from unreserved problem assets.

Downgrade pressure could come from loan quality and capital shocks
as well as significant increase in risk appetite, for example
through material acquisitions or expansion into higher- risk
lending.

BFA
The parent holding company's IDR, VR and senior debt ratings
remain sensitive to the same factors affecting the operating
bank's VR. Its ratings would also suffer from an ownership
dilution that results in a loss of control over its bank or
changes in the regulatory supervision approach of the group.
Downside could also arise from write-downs of assets or higher
debt or double leverage.

SUPPORT RATING AND SUPPORT RATING FLOOR (ALL BANKS)
An upgrade of the SRs and upward revision of the SRFs would be
contingent on a positive change in the sovereign's propensity to
support domestic banks. While not impossible, this is highly
unlikely, in Fitch's view.

SUBORDINATED DEBT
The rating of Bankia's subordinated debt is primarily sensitive to
a change in the bank's VR, which drive the ratings, but also to a
change in Fitch's view of non-performance or loss severity risk
relative to the bank's viability.

Fitch has taken the following rating actions:

Bankia:

Long-Term IDR affirmed at 'BBB-'; Outlook Stable

Short-Term IDR affirmed at 'F3'

Viability Rating: affirmed at 'bbb-'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

Long-term senior unsecured debt and debt programme: affirmed at
'BBB-'

Short-term senior unsecured debt programme and commercial paper:
affirmed at 'F3'

Subordinated debt: affirmed at 'BB+'

BFA:

Long-Term IDR affirmed at 'BB+'; Outlook Stable

Short-Term IDR affirmed at 'B'

Viability Rating: affirmed at 'bb+'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

Long-term senior unsecured debt: affirmed at 'BB+'


CAJA GRANADA: Fitch Affirms 'CCsf' Rating on Class D Notes
----------------------------------------------------------
Fitch Ratings has upgraded one tranche of AyT CGH Caja Granada,
downgraded two tranches of AyT Caja Murcia Hipotecario II, and
affirmed the others:

AyT CGH Caja Granada
Class A notes (ISIN ES0312273164): affirmed at 'A-sf'; Outlook
Stable
Class B notes (ISIN ES0312273172): upgraded to 'BB+sf' from 'Bsf';
Outlook Stable
Class C notes (ISIN ES0312273180): affirmed at 'CCCsf'; Recovery
Estimate (RE) 45%
Class D notes (ISIN ES0312273198): affirmed at 'CCsf'; RE 0%

AyT Caja Murcia Hipotecario II
Class A notes (ISIN ES0312272000): downgraded to 'A+sf' from 'AA-
sf'; Outlook Stable
Class B notes (ISIN ES0312272018): downgraded to 'BBB+sf' from
'A+sf''; Outlook Stable
Class C notes (ISIN ES0312272026): affirmed at 'BB+sf'; Outlook
Stable

The transactions comprise prime Spanish residential mortgages
serviced by Banco Mare Nostrum S.A (BMN; BB/Stable/B), originally
issued in 2006 and 2007.

KEY RATING DRIVERS

Credit Enhancement (CE) Trends
Fitch anticipates structural CE to continue increasing for AyT CGH
Caja Granada's senior notes, as the transaction is expected to
maintain sequential paydown over the coming years. The class A and
B notes benefit from the build-up of structural CE, which had
reached 30.8% and 12.0%, respectively as of the last interest
payment date. CE is expected to remain stable at around 9.6% for
the most senior tranche of AyT Murcia Hipotecario II as the pro-
rata amortisation logic is likely to remain in place.

Interest Deferability Not Effective
The downgrade of AyT Caja Murcia Hipotecario II classes A and B
notes reflects the ineffective junior interest deferability
triggers in stress scenarios, and the stable CE projected for the
coming years. Fitch anticipates the deferability mechanism will
not become effective as its application is conditioned on a
minimum volume of cumulative defaults of 4.6% and 6.7% for class B
and C, respectively. This is highly unlikely in light of the low
current portfolio balance of just 24% relative to the initial
amount and the current low volume of cumulative defaults of 0.2%.

Dissimilar Performance
AyT CGH Caja Granada has shown weaker asset performance compared
with other Spanish RMBS transactions. The level of three-months
plus arrears (excluding defaults) as a percentage of the current
pool balance was 1.7% as of November 2016. This ratio has been
decreasing since 2012, but it remains above Fitch's prime index of
below 1.0%. Excess spread has not always been sufficient to cover
defaults, leading to reserve fund drawings. The reserve fund has
been completely depleted since November 2014.

In contrast, AyT Murcia Hipotecario II continues to show a strong
credit performance, with three-months plus arrears of just 0.3% of
portfolio balance as of October 2016, and a fully funded reserve
fund.

Payment Interruption Risk
Both transactions have dedicated cash reserves aimed to mitigate
payment interruption risk in the event of servicer disruption.
Fitch views AyT Murcia II's reserve offers sufficient protection
under a scenario of stress, but views AyT CGH Caja Granada's
dynamic reserve as insufficient considering it does not account
for replacement servicer fees or net swap payments, and potential
top ups associated with higher interest rate scenarios depend on
BMN's financial ability to implement them. Therefore, AyT CGH Caja
Granada's class A notes' rating is capped at 'A-sf', five notches
above the rating of the collection account bank.

The rating cap also applied for the other mezzanine securitisation
notes because the dedicated cash reserves of both transactions are
only available for the class A notes.

Fitch believes that the transactions are exposed to potential
commingling losses because cash collections from the underlying
mortgages are clustered in few particular dates within every
month. While Fitch believes that AyT Murcia II's cash reserve is
sufficient to mitigate this additional stress, the agency has
modelled such stress as a loss under its analysis of AyT CGH Caja
Granada and found the current and projected CE to be sufficient to
mitigate the risk.

RATING SENSITIVITIES

If payment interruption risk was fully mitigated in AyT CGH Caja
Granada, the class A notes could be upgraded to the 'AAsf'
category all else being equal.

If AyT Caja Murcia Hipotecario II reverted to sequential
amortisation, the class A notes could be upgraded as structural CE
would increase, all else being equal.

A worsening of the Spanish macroeconomic environment especially
employment conditions, or an abrupt shift of interest rates could
jeopardise the underlying borrowers' affordability. This could
have negative rating implications, especially for junior tranches
that are less protected by structural CE.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset
pools and the transactions. 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
monitoring.

Fitch did not undertake a review of the information provided about
the underlying asset pools ahead of the transactions' initial
closing. The subsequent performance of the transactions 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.



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


CO-OPERATIVE BANK: Moody's Affirms Caa2 Long-Term Deposit Rating
----------------------------------------------------------------
Moody's Investors Service has affirmed Co-operative Bank Plc's
long-term deposit rating at Caa2, and downgraded the senior
unsecured debt ratings to Ca from Caa2. The outlook on both
ratings was changed to developing from positive, reflecting
Moody's expectation that efforts to address the current challenges
the bank faces in terms of its solvency may result in a range of
different outcomes. The short-term ratings were affirmed at Not
Prime.

Moody's also downgraded the bank's standalone baseline credit
assessment (BCA) to ca from caa2.

At the same time the bank's long-term Counterparty Risk Assessment
(CR Assessment) was downgraded to Caa1(cr)from B2(cr), the short-
term CR Assessment was affirmed at NP(cr).

The rating action follows the announcements made by the bank that
its common equity tier 1 ratio will remain below 10% in the medium
term (26 January 2017) and that, in light of its difficulty in
generating capital organically, its board has agreed to commence a
sale process to external parties (13 February 2017), as well as
considering other options to build capital, such as equity
injections by existing shareholders and/or a liability management
exercise upon existing debt obligations.

RATINGS RATIONALE

-- RATIONALE FOR THE BCA

The downgrade of the bank's BCA to ca reflects Moody's view that
the bank's standalone creditworthiness is increasingly challenged
and that the bank will not be able to restore its declining
capital position without external assistance. The bank has been
loss-making for the last five years and, despite some improvement
in cost management, Moody's expects it to remain so until 2018.
The bank is also facing higher than anticipated transformation and
conduct remediation costs while its interest income is pressured
by the prolonged low interest rate environment.

Due to on-going losses, the bank expects its common equity tier 1
(CET1) ratio to fall below 10% and remain below its Individual
Capital Guidance (ICG, i.e. Pillar 1 + 2A requirements set by the
Bank of England) in the medium term. The bank has been benefitting
from regulatory forbearance in relation to its compliance with its
ICG and capital buffer requirements (Pillar 2B) since 2013.
Although the regulator put out its own statement indicating that
they had discussed the board's decision with the bank and welcomed
the proposed sale, the likelihood of this forbearance remaining in
place in the medium-term is not certain.

Although Moody's considers that a sale of the whole bank to
strategic investors willing to recapitalise the bank would be
positive for the bank's creditworthiness, the process has just
been initiated and, in Moody's view, completion of a sale of the
bank either as a whole or in part is not certain. Given the bank's
weak profitability and remaining high stock of non-performing
loans in its non-core porfolio, a sale of the bank as a whole may
prove challenging, causing the bank's board to consider
alternative options to restore its solvency. According to the bank
such options could include raising equity from existing
shareholders and/or a liability management exercise upon its
outstanding public debt. As at June 2016, the bank had GBP405
million of senior unsecured debt outstanding, maturing in
September 2017, together with GBP 456 million of subordinated debt
(unrated) maturing after 2023. Moody's would likely consider a
liability management exercise resulting in a diminished value
relative to a debt obligation's original promise to be a default.

These developments suggest a high risk that the bank will be
unable to restore its capital levels to required regulatory levels
on a sustainable basis without recourse to external support or
imposing losses on bondholders, challenges consistent with a BCA
of ca.

-- RATIONALE FOR SENIOR DEBT AND DEPOSIT RATINGS

The downgrade of the senior unsecured debt rating to Ca reflects
Moody's view that senior unsecured bond holders could experience
losses in case of a bank failure or as part of a standalone
liability management exercise. The rating agency believes that if
such losses were to arise, they would likely be in the range of
35%-65%. In Moody's view, the remaining GBP 456 million of
subordinated debt (unrated) outstanding as of June 2016 is
unlikely to be sufficient by itself to address the capital
shortfall and shield senior unsecured debt-holders from losses.

The affirmation of the long-term deposit rating at Caa2 is based
on Moody's expectation that junior deposits are unlikely to incur
losses at the same level as senior unsecured bond holders if they
are included in a liability management exercise. The Caa2 rating
is consistent with an expectation of losses of up to 20% of
principal in the event of the bank's default.

RATIONALE FOR THE DEVELOPING OUTLOOK

The outlook on all ratings is developing, reflecting Moody's
expectation that efforts to address the current challenges in
terms of solvency may lead to one of a number of outcomes with
different credit implications for the bank's creditors. In case of
a successful sale or equity raising, restoring its capital without
affecting debt holders, the long-term debt and deposit ratings
would likely be upgraded. Conversely, a failure to raise capital,
higher than expected losses on debt and deposits, or an increased
likelihood of formal resolution proceedings may lead to rating
downgrades.

RATIONALE FOR THE CR ASSESSMENT

As part of action, Moody's also downgraded the bank's long-term CR
Assessment to Caa1(cr), three notches above the bank's BCA of ca.
The CR Assessment is driven by the banks' standalone assessment
and by the considerable amount of subordination from bail-in-able
deposits and debt in the liability structure which the agency
believes will allow the bank to continue to meet its operating
obligations even if it were to default on certain debt
liabilities.

WHAT COULD CHANGE THE RATINGS UP/DOWN

Given the low standalone BCA, scope for further downgrade is
limited, but would be likely in the event that current attempts to
restore the bank's solvency prove unsuccessful and the authorities
place the bank into a resolution process. This or the prospect of
larger-than-expected losses on senior unsecured debt or deposits
would likely result in lower ratings.

The BCA could be upgraded if the bank demonstrates further
progress in improving its capitalisation on a sustainable basis
without resorting to a liability management exercise. A positive
change in the BCA would likely lead to an upgrade in all ratings.

LIST OF AFFECTED RATINGS

Issuer: Co-Operative Bank Plc

Downgrades:

-- Long-term Counterparty Risk Assessment, downgraded to Caa1(cr)
from B2(cr)

-- Senior Unsecured Regular Bond/Debenture, downgraded to Ca
Developing from Caa2 Positive

-- Senior Unsecured Medium-Term Note Program, downgraded to (P)Ca
from (P)Caa2

-- Adjusted Baseline Credit Assessment, downgraded to ca from
caa2

-- Baseline Credit Assessment, downgraded to ca from caa2

Affirmations:

-- Short-term Counterparty Risk Assessment, affirmed NP(cr)

-- Long-term Deposit Ratings, affirmed Caa2, outlook changed to
Developing from Positive

-- Short-term Deposit Ratings, affirmed NP

-- Other Short Term, affirmed (P)NP

-- Commercial Paper, affirmed NP

Outlook Action:

-- Outlook changed to Developing from Positive

PRINCIPAL METHODOLOGY

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


JTJ WORKPLACE: Enters Into Corporate Voluntary Arrangement
----------------------------------------------------------
Alix Robertson and Jude Burke at FE Week reports that three
colleges have insisted they will stand by a multi-million pound
subcontractor, despite it entering into insolvency arrangements.

JTJ Workplace Solutions Limited owed more than GBP500,000 to HM
Revenue and Customs, and GBP246,000 to Pearson, FE Week discloses.

This is according to the report of a meeting approving it entering
into a corporate voluntary arrangement, published on Companies
House last December, FE Week notes.

The total amount due to the company's 12 creditors was GBP938,366
and the CVA has shored up its finances for the time being, with
structured repayment arrangements in place, FE Week discloses.

FE Week approached the 10 colleges with GBP6.4 million of
subcontracted provision, as of January this year, to ask if they
planned to continue with the arrangements in view JTJ's financial
problems, FE Week relates.

The three that confirmed they are still subcontracting with JTJ,
told FE Week they had no intention of cancelling the arrangement.

According to FE Week, Gateshead College, with a contract worth
around GBP2.5 million with JTJ; West Nottinghamshire College, with
GBP810,000; and the Grimsby Institute of Further and Higher
Education, with GBP345,000, each confirmed they were aware of the
situation but would continue with JTJ.

Adam Hayes, one of the directors of JTJ, told FE Week that the
company was fine to continue with the provision.

It is still trading with "most of the creditors in the CVA (100%
of creditors supported the CVA)", expects "to deliver over 4,000
apprenticeships over the next 12 months" and is "enrolling more
learners", FE Week notes.


MALLINCKRODT INTERNATIONAL: S&P Rates $1.862MM Sr. Sec. Loan BB+
----------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' issue-level rating and '1'
recovery rating to the proposed $1.862 million senior secured term
loan B co-issued by Mallinckrodt International Finance S.A. and
Mallinckrodt CB LLC and guaranteed by parent Mallinckrodt PLC.

Proceeds will be used to refinance two of the company's
outstanding senior secured term loans of equal amount.  The
recovery rating of '1' reflects S&P's expectation of very high
(90% to 100%) recovery in the event of payment default.  In
addition, the 'BB+' issue-level rating and '1' recovery rating on
Mallinckrodt's senior secured debt will remain unchanged after the
proposed increase in the secured revolving credit facility to
$1 billion.

The 'BB-' issue-level ratings and '3' recovery ratings on the
senior unsecured notes also remain unchanged.  However, the higher
level of projected senior secured debt in the event of default,
resulting from the revolver upsizing, has moved S&P's recovery
expectation for the senior unsecured notes toward the lower end of
the 50%-70% range.

The 'B' issue-level rating and '6' recovery rating on the
$300 million 3.50% senior unsecured notes due April 2018 and the
$600 million 4.75% senior unsecured notes due April 2023 are also
unchanged. Lower recovery ratings on those tranches of senior
unsecured notes reflect the guarantee from parent Mallinckrodt PLC
and the absence of guarantees from its subsidiaries.

Given Mallinckrodt's strong cash flow generation and the recently
received $574 million from the sale of the nuclear imaging
business, S&P don't view the revolver upsizing as a signal of
anticipated liquidity difficulties.  In addition, the new revolver
size is in line with S&P's expectation for Mallinckrodt's
financial policy that includes moderate amounts of business
development activity.  S&P thinks Mallinckrodt will maintain
adequate liquidity levels and sustain leverage in the 4.0x-5.0x
range going forward.

RATINGS LIST

Mallinckrodt PLC
Corporate Credit Rating        BB-/Stable/--

New Ratings
Mallinckrodt International Finance S.A.
Mallinckrodt CB LLC
$1.862 million senior secured term loan B       BB+
  Recovery rating                               1

Recovery Expectations Revised
Mallinckrodt International Finance S.A.
Mallinckrodt CB LLC
Senior unsecured notes             BB-           BB-
   Recovery rating                 3L            3H


STANLINGTON NO.1: Moody's Assigns (P)Ba2 Rating to Cl. E Notes
---------------------------------------------------------------
Moody's Investors Service has assigned provisional long-term
credit ratings to Notes to be issued by Stanlington No.1 PLC:

-- GBP [ ]M Class A Floating Rate Notes due [June 2046],
    Assigned (P) Aaa (sf)

-- GBP [ ]M Class B Floating Rate Notes due [June 2046],
    Assigned (P) Aa1 (sf)

-- GBP [ ]M Class C Floating Rate Notes due [June 2046],
    Assigned (P) A2 (sf)

-- GBP [ ]M Class D Floating Rate Notes due [June 2046],
    Assigned (P) Baa2 (sf)

-- GBP [ ]M Class E Floating Rate Notes due [June 2046],
    Assigned (P) Ba2 (sf)

Moody's has not assigned ratings to the GBP [ ]M Class X Notes due
[June 2046] and GBP [ ]M Class Z Notes due [June 2046].

The portfolio backing this transaction consists of UK non-
conforming residential loans originated by multiple lenders: GMAC-
RFC Limited (currently known as Paratus AMC Limited, [62.5]% of
the loans), Victoria Mortgages Funding Limited (not rated, [37.4]%
of the loans), Amber Homeloans Limited (not rated) and First
Alliance Mortgage Company Limited (not rated) together
representing [0.1]% of the loans).

On the closing date, Paratus AMC Limited will sell the portfolio
to Stanlington No.1 PLC.

RATINGS RATIONALE

The ratings take into account the credit quality of the underlying
mortgage loan pool, from which Moody's determined the MILAN Credit
Enhancement (CE) and the portfolio expected loss, as well as the
transaction structure and legal considerations. The expected
portfolio loss of [7.0]% and the MILAN CE of [27.0]% serve as
input parameters for Moody's cash flow model, which is based on a
probabilistic lognormal distribution.

The portfolio expected loss of [7.0]%, which is higher than other
recent UK Non-Conforming transactions and takes into account: (i)
the number of loans in arrears at closing including the
performance of the pool since January 2010. [24.2]% of the pool is
in arrears at the end of November 2016, of which [8.3]% is more
than 90 days in arrears, (ii) the WA current LTV of [81.9]% (iii)
the limited historical performance information available for some
originators in the portfolio, (iv) the current macroeconomic
environment and Moody's views of the future macroeconomic
environment in the UK, and (v) benchmarking with similar
transactions in the UK Non-Conforming Sector.

The MILAN CE for this pool is [27.0%], which is higher than other
recent UK Non-Conforming transactions and takes into account: (i)
the high WA current LTV of [81.9%], (ii) the presence of [86.5]%
loans where the borrowers' income is either self-certified or was
not verified, (iii) borrowers with bad credit history with [14.5]%
of the pool containing borrowers with CCJ's, (iv) the presence of
[2.7]% of right to buy loans in the pool, (v) the weighted average
seasoning of the pool of [10.0] years and (vi) the level of
arrears around [24.2]% at the end of November 2016.

The reserve fund will consist of two components and will be
partially funded at closing. The first is a liquidity component,
which will be funded at closing and is sized at [2.25]% of Class A
and B note balance at closing. The liquidity component of the
reserve fund will amortise to the lesser of [2.25]% of Class A and
B note balance at closing and [3.0]% of the currently outstanding
balance of Class A and B notes during the life of the transaction.
The liquidity component of the reserve will be available to cover
senior fees and interest on Class A and B (subject to no PDL on
the Class B). The liquidity component of the reserve will be
replenished in the revenue waterfall below the Class B interest
payments.

The second component of the reserve fund, which is not funded at
closing, is non amortising and is sized at [2.05]% of the pool
balance at closing minus the balance of the liquidity reserve
component from time to time. The general component of the reserve
fund will not be funded at closing, but will be built up at a
junior position in the waterfall below Class X interest. The
general component of the reserve fund is available upon conditions
to cover both credit and interest and senior fee shortfalls.

Operational Risk Analysis: Paratus AMC Limited ("Paratus") will be
acting as servicer and is not rated by Moody's. In order to
mitigate the operational risk, the transaction will have a back-up
servicer facilitator (Intertrust Management Limited (Not rated)).
Elavon Financial Services DAC, UK Branch will be acting as an
independent cash manager from closing. To ensure payment
continuity over the transaction's lifetime, the transaction
documents incorporate estimation language whereby the cash manager
can use the three most recent servicer reports to determine the
cash allocation in case no servicer report is available. Class A
notes benefit from principal to pay interest, and the liquidity
component of the reserve fund. The liquidity component of the
reserve provides the Class A notes with the equivalent of just
over [1] quarter of liquidity assuming a LIBOR rate of 5.7%.

Interest Rate Risk Analysis: The transaction is unhedged with
[27.1]% of the pool balance linked to Bank of England Base Rate
(BBR), [56.7]% linked to three-month LIBOR and [16.2]% SVR-linked
loans. Moody's has taken the absence of basis swap into account in
its cashflow modelling.

The provisional 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 at par on or before the rated final
legal maturity date for the rated notes. Moody's issues
provisional ratings in advance of the final sale of securities,
but these ratings represent only Moody's preliminary credit
opinions. Upon a conclusive review of the transaction and
associated documentation, Moody's will endeavour to assign
definitive ratings to the Notes. A definitive rating may differ
from a provisional rating. Other non-credit risks have not been
addressed, but may have a significant effect on yield to
investors.

Moody's Parameter Sensitivities: If the portfolio expected loss
was increased from [7.0]% to [10.5]% of current balance, and the
MILAN CE was kept constant at [27.0]%, the model output indicates
that the Class A notes would still achieve (P) Aaa (sf) assuming
that all other factors remained equal. Moody's Parameter
Sensitivities quantify the potential rating impact on a structured
finance security from changing certain input parameters used in
the initial rating. The analysis assumes that the deal has not
aged and is not intended to measure how the rating of the security
might change over time, but instead what the initial rating of the
security might have been under different key rating inputs.

Parameter Sensitivities for the typical EMEA RMBS transaction are
calculated by stressing key variable inputs in Moody's primary
rating model.

The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
September 2016.

The analysis undertaken by Moody's at the initial assignment of
ratings for RMBS securities may focus on aspects that become less
relevant or typically remain unchanged during the surveillance
stage.

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

Significantly different loss assumptions compared with Moody's
expectations at close due to either a change in economic
conditions from Moody's central scenario forecast or idiosyncratic
performance factors would lead to rating actions. For instance,
should economic conditions be worse than forecast, the higher
defaults and loss severities resulting from a greater
unemployment, worsening household affordability and a weaker
housing market could result in downgrade of the ratings.
Deleveraging of the capital structure or conversely deterioration
in the notes available credit enhancement could result in an
upgrade or a downgrade of the ratings, respectively.


TATA STEEL UK: Workers Vote in Favor of Pension Scheme Changes
--------------------------------------------------------------
Alan Tovey at The Telegraph reports that Tata Steel workers have
voted in favor of changes to their pension scheme that will mean
less generous retirement payouts but guarantee jobs and secure
investment in the UK steel-making business.

According to The Telegraph, unions balloted members working at
Tata over proposals that would move them from a final-salary
scheme to a defined-contribution system.

In return, the company pledged no compulsory redundancies, GBP1
billion of investment over 10 years, and a commitment to keep open
two blast furnaces at Tata's sprawling Port Talbot site into the
next decade, The Telegraph relates.

The new deal would replace the current pension scheme with an
arrangement under which the maximum contribution from Tata would
be 10%, plus a 6% contribution from staff, The Telegraph
discloses.

Tata had warned that the huge GBP15 billion British Steel Pension
Scheme could risk the future of its UK steel business, The
Telegraph notes.

Trustees of the pension said the 140,000-member scheme could
report a deficit of between GBP1 billion and GBP2 billion at its
next valuation, The Telegraph relays.

Tata would have to pay as much as GBP200 million a year for 15
years to plug this funding gap, and trustees, as cited by The
Telegraph, said they had been told by the business it could not
afford these contributions and would likely collapse as a result.

In the event of a Tata collapse, steelworkers would see their
retirement scheme dropped into the pension protection fund
"lifeboat", possibly meaning even smaller payouts, The Telegraph
states.

Tata Steel is the UK's biggest steel company.



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


* BOOK REVIEW: Risk, Uncertainty and Profit
-------------------------------------------
Author: Frank H. Knight
Publisher: Beard Books
Softcover: 381 pages
List Price: $34.95

Review by Gail Owens Hoelscher
Order your personal copy today at
http://www.beardbooks.com/beardbooks/risk_uncertainty_and_profit.h
tml
The tenets Frank H. Knight sets out in this, his first book,
have become an integral part of modern economic theory. Still
readable today, it was included as a classic in the 1998 Forbes
reading list. The book grew out of Knight's 1917 Cornell
University doctoral thesis, which took second prize in an essay
contest that year sponsored by Hart, Schaffner and Marx. In it,
he examined the relationship between knowledge on the part of
entrepreneurs and changes in the economy. He, quite famously,
distinguished between two types of change, risk and uncertainty,
defining risk as randomness with knowable probabilities and
uncertainty as randomness with unknowable probabilities. Risk,
he said, arises from repeated changes for which probabilities
can be calculated and insured against, such as the risk of fire.
Uncertainty arises from unpredictable changes in an economy,
such as resources, preferences, and knowledge, changes that
cannot be insured against. Uncertainty, he said "is one of the
fundamental facts of life."

One of the larger issues of Knight's time was how the
entrepreneur, the central figure in a free enterprise system,
earns profits in the face of competition. It was thought that
competition would reduce profits to zero across a sector because
any profits would attract more entrepreneurs into the sector and
increase supply, which would drive prices down, resulting in
competitive equilibrium and zero profit.

Knight argued that uncertainty itself may allow some
entrepreneurs to earn profits despite this equilibrium.
Entrepreneurs, he said, are forced to guess at their expected
total receipts. They cannot foresee the number of products they
will sell because of the unpredictability of consumer
preferences. Still, they must purchase product inputs, so they
base these purchases on the number of products they guess they
will sell. Finally, they have to guess the price at which their
products will sell. These factors are all uncertain and
impossible to know. Profits are earned when uncertainty yields
higher total receipts than forecasted total receipts. Thus,
Knight postulated, profits are merely due to luck. Such
entrepreneurs who "get lucky" will try to reproduce their
success, but will be unable to because their luck will
eventually turn.

At the time, some theorists were saying that when this luck runs
out, entrepreneurs will then rely on and substitute improved
decision making and management for their original
entrepreneurship, and the profits will return. Knight saw
entrepreneurs as poor managers, however, who will in time fail
against new and lucky entrepreneurs. He concluded that economic
change is a result of this constant interplay between new
entrepreneurial action and existing businesses hedging against
uncertainty by improving their internal organization.

Frank H. Knight has been called "among the most broad-ranging
and influential economists of the twentieth century" and "one of
the most eclectic economists and perhaps the deepest thinker and
scholar American economics has produced." He stands among the
giants of American economists that include Schumpeter and Viner.
His students included Nobel Laureates Milton Friedman, George
Stigler and James Buchanan, as well as Paul Samuelson. At the
University of Chicago, Knight specialized in the history of
economic thought. He revolutionized the economics department
there, becoming one the leaders of what has become known as the
Chicago School of Economics. Under his tutelage and guidance,
the University of Chicago became the bulwark against the more
interventionist and anti-market approaches followed elsewhere in
American economic thought. He died in 1972.



                            *********

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

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

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


                            *********


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

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez,
Joy A. Agravante, Julie 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
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Information contained herein is obtained from sources believed to
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The TCR Europe subscription rate is US$775 per half-year,
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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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                 * * * End of Transmission * * *