TCREUR_Public/170419.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Wednesday, April 19, 2017, Vol. 18, No. 77


                            Headlines


C R O A T I A

AGROKOR DD: Units to Act as Co-Debtors for Liabilities


C Y P R U S

BANK OF CYPRUS: Fitch Affirms B- Long-Term Issuer Default Rating


I T A L Y

BANCA POPOLARE: Fitch Corrects March 17 Rating Release
MONTE DEI PASCHI: In Negotiations with EU Commission on Job Cuts
* ITALY: Europe Should Follow Own Rules on Rescue of Banks


N E T H E R L A N D S

DPX HOLDINGS: Moody's Assigns B2 Rating to $1.133BB Term Loan
SYNCREON GROUP: Moody's Revises Outlook to Neg., Affirms B3 CFR


R U S S I A

ARCELORMITTAL: Fitch Revises Outlook to Stable, Affirms BB+ IDR
GLOBALTRANS INVESTMENT: Moody's Raises CFR to Ba2, Outlook Stable
VSK INSURANCE: Fitch Rates RUB4BB Senior Unsecured Bonds BB-


S P A I N

BBVA CAPITAL: S&P Affirms BB- Rating on Preferred Stock


T U R K E Y

ANTALYA: Fitch Revises Outlook to Negative, Affirms BB+ IDR


U K R A I N E

NAFTOGAZ OF UKRAINE: Fitch Affirms CCC LT Issuer Default Ratings
PRIVATBANK: Finance Ministry to Finalize Rehabilitation Plan
PRIVATBANK: Ex-Owners Responsible for Fraudulent Transactions


U N I T E D   K I N G D O M

FOUR SEASONS: Mulls Sale of Huntercombe Group to Cut Debt


                            *********


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C R O A T I A
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AGROKOR DD: Units to Act as Co-Debtors for Liabilities
------------------------------------------------------
SeeNews reports that units of Croatia's troubled concern Agrokor
will act as co-debtors for the liabilities of their parent
company under a EUR80 million (US$85.2 million) loan deal which
Agrokor signed with several local banks last week.

According to SeeNews, several Agrokor units said in separate
filings with the Zagreb bourse that on April 18, the loan,
maturing in 15 months and carrying an interest rate of 4.97%, was
signed with Zagrebacka banka, Privredna banka,
Erste&Steiermaerkische Bank and the local unit of Austria's
Raiffeisenbank.

Agrokor's units, including ice cream and frozen food producer
Ledo, food company Belje, soft drinks and water bottling company
Jamnica and others, have committed to acting as co-debtors,
SeeNews discloses.

Zagreb-based Agrokor is the biggest food producer and retailer in
the Balkans, employing almost 60,000 people across the region
with annual revenue of some HRK50 billion (US$7billion).

                            *   *   *

The Troubled Company Reporter-Europe reported on April 10, 2017,
that S&P Global Ratings said it lowered its long- and short-term
corporate credit ratings on Croatian retailer Agrokor d.d. to
'CC/C' from 'B-/B'.  The outlook is negative.  At the same time,
S&P lowered the issue rating on the senior unsecured notes to
'CC' from 'B-'.

On April 2, 2017, a spokesperson for the Agrokor group said that
the company reached an agreement with its bank creditors to
freeze debt payments.  The creditor group includes Sberbank, VTB,
and Erste Bank, which together account for most of the EUR2.5
billion loan debt for the Agrokor group, as of Sept. 30, 2016.

The TCR-Europe on March 31, 2017, reported that Moody's Investors
Service downgraded the Croatian retailer and food manufacturer
Agrokor D.D.'s corporate family rating (CFR) to Caa1 from B3 and
its probability of default rating (PDR) to Caa1-PD from B3-PD.
Moody's has also downgraded the senior unsecured rating assigned
to the notes issued by Agrokor and due in 2019 and 2020 to Caa1
from B3. The outlook on the company's ratings remains negative.

"Our downgrade of Agrokor's rating reflects Moody's views that
the company is no longer able to sustain its high level of trade
payables, which may constrain its liquidity position," says
Vincent Gusdorf, a Vice President -- Senior Analyst at Moody's.
"This comes at a time when the company has limited means to raise
additional sources of liquidity owing to its restricted access to
credit markets and its reliance on a limited number of banks."



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C Y P R U S
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BANK OF CYPRUS: Fitch Affirms B- Long-Term Issuer Default Rating
----------------------------------------------------------------
Fitch Ratings has affirmed Bank of Cyprus Public Company Ltd's
(BoC) Long-Term Issuer Default Rating (IDR) at 'B-' and Hellenic
Bank Public Company Limited's (HB) Long-Term IDR at 'B'. The
Outlooks on both banks' Long-Term IDRs are Stable.

KEY RATING DRIVERS
IDRS, VIABILITY RATINGS, BOC's SENIOR DEBT

BoC's and HB's ratings reflect the banks' exceptionally high
levels of non-performing exposures (NPE, as per EBA definition)
and high capital encumbrance by unreserved NPEs. HB's ratings
also factor in the high share of high quality non-loan earning
assets on its balance sheet, supporting its overall asset quality
and liquidity and driving the one-notch difference relative to
BoC's ratings.

Loan quality remains weak at both banks. The NPE to gross loans
ratios remain high at end-2016 at 55% for BoC and 58% for HB
(including suspended interest income on impaired loans), down
from 62% and 59% at end-2015 respectively. Progress in working
out problem assets has been made since the implementation of the
new insolvency and foreclosure frameworks in 2015. The banks
stepped-up their restructuring efforts, significantly increasing
the volume of loan restructurings (to about 30% of gross loans in
2016 at BoC and 16% at HB).

Restructured loans are performing with an acceptable level of re-
defaults, although the record of adequate performance is still
short, in Fitch's view, and crucially depends on the developments
in the broader economy. For HB, Fitch assessments of asset
quality takes into account the high quality of the bank's other
earning assets, in particular a large placement with the ECB
(EUR2 billion or slightly below 30% of total assets).

The banks' reliance on collateral means NPE coverage ratios are
low by international standards (albeit improving), resulting in
high levels of unreserved NPE relative to capital (2.9x Fitch
Core Capital (FCC) for BoC at end-2016 and 2.2x FCC for HB).
Foreclosed real estate equalled further 0.6x of FCC at BoC and
0.2x of FCC at HB. This makes the banks' capitalisation highly
sensitive to even moderate shocks in the property market. Real
estate prices in Cyprus have been stable since the beginning of
2015 but remain around 30% lower than their pre-crisis peak.
Fitch's assessment of the banks' capitalisation factors in
further progress in reducing capital encumbrance.

The stability of customer deposits in Cyprus since the full
removal of capital controls in April 2015 has supported the
banks' funding profiles, although they remain prone to changes in
depositor sentiment. HB has stronger liquidity than BoC. BoC's
liquidity position further improved in January 2017 following
full repayment of the Emergency Liquidity Assistance funding,
achieved mainly through growth of customer deposits. At end-March
2017, BoC achieved compliance with the liquidity coverage ratio
requirement (set at 80% for 2017) and Fitch expects ensuring
compliance with the 100% requirement effective from 2018 to be
one of the key priorities for the management in the near term.

BoC's and HB's earnings remain pressured by high provisioning
needs, although BoC managed to post a small net profit in 2016
for the first time since 2011. Pre-impairment profitability is
inflated by the significant and largely non-cash interest accrued
on the net amount of impaired loans. HB's revenues are also
pressured by its large stock of high quality but low earning
assets. Fitch expects loan impairment charges and the banks'
ability to contain them to be the key drivers of their
profitability in the medium term.

BOC's SUBORDINATED DEBT

BoC's subordinated Tier 2 notes are notched off its Viability
Rating. In accordance with Fitch's criteria, these notes are
notched twice off the Viability Rating for loss severity given
that the layer of subordinated debt is very thin relative to the
size of the bank's potential problem (reflected in the high
volume of unreserved NPE).

SUPPORT RATINGS AND SUPPORT RATING FLOORS

BoC's and HB's Support Ratings of '5' and Support Rating Floors
of 'No Floor' reflect Fitch's view that senior creditors can no
longer rely on receiving full extraordinary support from the
sovereign if BoC or HB become non-viable. The EU's Bank Recovery
and Resolution Directive and the Single Resolution Mechanism for
eurozone banks provide a framework for resolving banks that is
likely to require senior creditors participating in losses, if
necessary, instead of or ahead of a bank receiving sovereign
support.

Furthermore, Fitch believes Cypriot authorities have limited
resources at their disposal, as demonstrated primarily by the
receipt of an international support package of EUR10 billion and
the March 2013 imposition of losses on senior creditors of Bank
of Cyprus and Laiki Popular Bank.

RATING SENSITIVITIES
IDRS, VIABILITY RATINGS, BOC's SENIOR DEBT

An upgrade is unlikely in the near term given the banks' asset
quality problems, but a significant reduction of NPE and
demonstrated ability to dispose of foreclosed assets, resulting
in a much lower vulnerability of their capital to stress, could
be rating positive.

The ratings could be downgraded if the banks fail to reduce
capital encumbrance by unreserved NPE or if asset quality
deterioration jeopardises solvency or if there are any unforeseen
shocks to the stability of the banks' deposits. HB's ratings are
more sensitive to a failure to achieve reduction in capital
encumbrance given its higher rating and more limited progress so
far.

SUPPORT RATING AND SUPPORT RATING FLOOR

Fitch believes there is little upside potential for BoC's and
HB's Support Ratings and Support Rating Floors. This is due to
the authorities' limited capacity to provide future support, the
presence of a resolution scheme with bail-in tools that have
already been implemented, but also in light of a clear intention
to reduce implicit state support for financial institutions in
the EU.

BOC's SUBORDINATED DEBT

BoC's subordinated debt ratings are sensitive to changes in the
bank's Viability Rating. They could be upgraded if the layer of
subordinated debt becomes significant relative to the bank's
unreserved NPEs, either through an increase in the amount of
junior debt or through a significant reduction of unreserved
NPEs.

The rating actions are:

Bank of Cyprus
Long-Term IDR: affirmed at 'B-'; Stable Outlook
Short-Term IDR: affirmed at 'B'
Viability Rating: affirmed at 'b-'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Senior debt long-term rating: affirmed at 'B-'/'RR4
Senior debt short-term rating: affirmed at 'B'
Subordinated debt long-term rating: assigned at 'CC'/'RR6'

Hellenic Bank
Long-Term IDR: affirmed at 'B'; Stable Outlook
Short-Term IDR: affirmed at 'B'
Viability Rating: affirmed at 'b'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'


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I T A L Y
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BANCA POPOLARE: Fitch Corrects March 17 Rating Release
------------------------------------------------------
This announcement replaces the version published on March 17,
2017 to correct the net impaired loans to Fitch Core Capital
based on pro-forma end-1H16 data.

Fitch Ratings has downgraded Banca Popolare di Vicenza's
(Vicenza) Long-Term Issuer Default Rating (IDR) to 'CCC' from 'B-
' and Viability Rating (VR) to 'cc' from 'b-'. The Long-Term IDR
has been placed on Rating Watch Evolving (RWE). A full list of
rating actions is at the end of this rating action commentary.

The downgrade of Vicenza's VR to 'cc' reflects Fitch's view that
it is probable that the bank will require fresh capital to
address a material capital shortfall, which under Fitch's
criteria would be a failure.

The downgrade of the Long-Term IDR to 'CCC' reflects Fitch's view
that there is a real possibility that losses could be imposed on
senior bondholders if a conversion or write-down of junior debt
is not sufficient to strengthen capitalisation and if the bank
does not receive fresh capital in a precautionary
recapitalisation.

The RWE reflects the possibility that the Long-Term IDR could be
further downgraded if Fitch concludes that losses to senior
creditors are probable. Conversely, if the bank receives a
precautionary recapitalisation without any senior creditor
suffering a loss, the Long-Term IDR could be upgraded.

KEY RATING DRIVERS
IDRS, VR AND SENIOR DEBT

Vicenza's Long-Term IDR is one notch above the VR to reflect
Fitch's view that the probability that senior creditors will have
to bear losses is lower than the probability of the bank's
failure. This is primarily because if there is a precautionary
recapitalisation senior creditors will not suffer losses.

Vicenza's VR primarily reflects Fitch's view that capitalisation
has clear deficiencies. In Fitch's opinion, the bank will have to
dispose of a significant portion of its impaired exposures to
restore viability, which will likely require material additional
provisions to align doubtful loan coverage levels to current
market valuations for large non-performing loan portfolios. These
provisions would lead to material losses that would hit the
bank's capital.

Vicenza's net impaired loans represented a high 170% of its Fitch
Core Capital based on pro-forma end-1H16 data. This includes a
EUR310m capital injection received in late 2016 from its main
shareholder, the Italian rescue fund Atlante. Fitch does not
believe that Atlante has sufficient resources to inject material
further capital into the bank. To be eligible for a precautionary
recapitalisation from the Italian state, Vicenza has to be deemed
solvent and to meet Pillar 1 regulatory capital requirements by
the supervisory authorities. The authorities will also determine
the amount of any capital shortfall, and any precautionary
recapitalisation is subject to approval by the European
Commission under state aid rules. If it is ineligible for a
precautionary recapitalisation, Fitch believes that Vicenza might
be subject to resolution.

In addition to substantial impaired loans, an important
consideration for the bank's solvency assessment is its material
litigation risk from its shareholders related to past capital
increases. Vicenza is facing challenges in concluding a potential
settlement with shareholders.

Vicenza's VR also reflects its weak asset quality, earnings and
funding. Its deposit base remains highly vulnerable to market
sentiment around the bank and the broader Italian banking sector.
Vicenza's liquidity ratios are highly volatile and balance sheet
encumbrance is at historical highs. The bank recently issued
EUR3bn state-guaranteed senior notes, partly sold to the market
and partly retained to pledge with market counterparties to
generate liquidity.

Vicenza's senior unsecured bonds are rated in line with the
bank's IDR. The Recovery Rating of '4' (RR4) reflects Fitch's
expectation of average recovery prospects in the event of a
default of these instruments.

The Short-term IDR is mapped from the Long-Term IDR.

SUPPORT RATING (SR) AND SUPPORT RATING FLOOR (SRF)
The SR and SRF reflect Fitch's view that although external
support is possible, including through a precautionary
recapitalisation, it cannot be relied upon. Senior creditors can
no longer expect to receive full extraordinary support from the
sovereign in the event that the bank becomes non-viable. The EU's
Bank Recovery and Resolution Directive (BRRD) and the Single
Resolution Mechanism (SRM) for eurozone banks provide a framework
for the resolution of banks that requires senior creditors to
participate in losses, if necessary, instead of or ahead of a
bank receiving sovereign support.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated Tier 2 debt issued by Vicenza is rated 'CC' and
reflects Fitch views that these instruments could be vulnerable
to write down or conversion in the context of a precautionary
recapitalisation or in a resolution scenario. Their Recovery
Rating of '5' (RR5) reflects below average recovery prospects for
subordinated bondholders.

SENIOR STATE-GUARANTEED SECURITIES

The Long-term rating of Vicenza's state-guaranteed debt is based
on Italy's direct, unconditional and irrevocable guarantee for
the issues, which covers payments of both principal and interest.
Italy's guarantee was issued by the Ministry of Economy and
Finance under Law Decree December 23, 2016, n. 237, subsequently
converted into law 15/2017.The ratings reflect Fitch's
expectation that Italy will honour the guarantee provided to the
noteholders in a full and timely manner. The state guarantee
ranks pari passu with Italy's other unsecured and unguaranteed
senior obligations. As a result, the notes' Long-Term ratings are
in line with Italy's 'BBB+' Long-Term IDR.

RATING SENSITIVITIES
IDRS, VR AND SENIOR DEBT

Vicenza's VR is primarily sensitive to the size of any capital
shortfall at the bank and how this shortfall will be addressed.
The VR would likely be downgraded to 'c' if Vicenza requires an
extraordinary intervention to cover a material capital shortfall.
After the receipt of fresh capital, Vicenza's VR would be
downgraded to 'f' before being upgraded to a level commensurate
with the bank's subsequent risk profile and capitalisation. The
VR would also be downgraded to 'f' in the event of resolution.

Vicenza's IDRs would be upgraded if its capitalisation improves
materially to strengthen its viability without any losses for
senior creditors, which could be achieved, for example, through a
precautionary recapitalisation and settlement of outstanding
litigation risk from shareholders. Conversely, if in Fitch's
opinion a resolution of the bank that could involve losses for
senior creditors become more likely the Long-Term IDR would be
downgraded further.

Fitch expects to resolve the RWE on the IDRs when there is
further clarity on how any capital shortfall at the bank will be
addressed. Vicenza will publish its 2016 annual results in late
March, when additional information regarding a restructuring of
the bank and its recapitalisation could become available. The
resolution of the RWE could take longer than the typical six-
month period if the bank's plans and authorisations are delayed.

SR AND SRF

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

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

The ratings of the subordinated securities could be downgraded if
recovery prospects for bondholders deteriorate, which would also
be reflected in a lower recovery rating.

SENIOR STATE-GUARANTEED SECURITIES

The notes' ratings are sensitive to changes in Italy's rating.
Any downgrade or upgrade of Italy's Long-Term IDR would be
reflected on the notes' ratings. Italy's rating was last reviewed
on October 21, 2016 (see: Fitch Revises Italy's Outlook to
Negative; Affirms at 'BBB+' available at www.fitchratings.com).
The next scheduled review of Italy's sovereign rating is due on
21 April 2017.

The rating actions are:

Long-Term IDR: downgraded to 'CCC' from 'B-'; placed on RWE
Short-Term IDR: downgraded to 'C' from 'B'; placed on RWE
Viability Rating: downgraded to 'cc' from 'b-'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Long-term senior unsecured notes and EMTN programme: downgraded
to 'CCC/RR4' from 'B-/RR4'; placed on RWE
Short-term rating on EMTN programme: downgraded to 'C' from 'B';
placed on RWE
Subordinated debt: affirmed at 'CC'/'RR5'
State-guaranteed debt: affirmed at 'BBB+'


MONTE DEI PASCHI: In Negotiations with EU Commission on Job Cuts
----------------------------------------------------------------
Silvia Aloisi and Stefano Bernabei at Reuters report that Monte
dei Paschi di Siena on April 12 said it is still negotiating with
the European Commission how many jobs to cut in a radical
restructuring plan that is a condition for a state rescue of the
Italian bank.

The world's oldest bank, whose troubles date back several years,
asked for state support in December after failing to raise EUR5
billion (US$5.3 billion) on the market to shore up its capital,
Reuters recounts.

The European Central Bank has since put the capital shortfall
that the bank must fill at EUR8.8 billion, Reuters notes.  The
Italian government is expected to pump EUR6.6 billion into the
bank, taking a stake of around 70%, Reuters says.

But for state aid to be unlocked, the European Commission must
approve the bank's restructuring and negotiations are dragging
on, Reuters notes.

Monte dei Paschi Chief Executive Marco Morelli's own business
plan, unveiled in October, envisaged 2,600 layoffs -- around 10%
of the bank's employees -- and 500 branch closures, but he said
Brussels is demanding "a much more stringent approach" in terms
of cost cuts and revenue targets, Reuters relays.

According to Reuters, Mr. Morelli told a shareholder meeting on
April 12 he did not know the final number of job cuts.  A source
close to the matter, as cited by Reuters, said the EU was asking
for a staff reduction of more than 5,000 people.

One big hurdle is the bank's mountain of problem loans, which
stand at EUR46 billion on a gross basis -- the highest amount
relative to a bank's capital in Italy, Reuters states.

Monte dei Paschi's failed capital raising last year was designed
to cover losses from the planned disposal of EUR28 billion of its
most toxic soured debts, Reuters discloses.

Mr. Morelli said the bank needed to get rid of such loans as soon
as possible, but also said the timing and details of the sale
were still being discussed as Monte dei Paschi wanted to minimize
further loan losses, Reuters relates.

Banca Monte dei Paschi di Siena SpA -- http://www.mps.it/-- is
an Italy-based company engaged in the banking sector.  It
provides traditional banking services, asset management and
private banking, including life insurance, pension funds and
investment trusts.  In addition, it offers investment banking,
including project finance, merchant banking and financial
advisory services.  The Company comprises more than 3,000
branches, and a structure of channels of distribution.  Banca
Monte dei Paschi di Siena Group has subsidiaries located
throughout Italy, Europe, America, Asia and North Africa.  It has
numerous subsidiaries, including Mps Sim SpA, MPS Capital
Services Banca per le Imprese SpA, MPS Banca Personale SpA, Banca
Toscana SpA, Monte Paschi Ireland Ltd. and Banca MP Belgio SpA.


* ITALY: Europe Should Follow Own Rules on Rescue of Banks
----------------------------------------------------------
Sonia Sirletti, Chiara Albanese and Chiara Vasarri at Bloomberg
News report that Europe should follow its own rules when it looks
at the rescue of Italian banks.

"If Europe gives itself rules, then it should also abide by the
rules," European Central Bank Executive Board member Yves Mersch
said in a Bloomberg Television interview on April 7 at the
Ambrosetti Workshop in Cernobbio, Italy. "That rule respect is a
very important element where Europe has to make a little bit more
progress."

The European Union has enacted procedures for failing banks meant
to end taxpayer bailouts with the so-called "bail-ins", Bloomberg
discloses.

The new rules came after governments used nearly EUR2 trillion
(US$2.12 trillion) in state aid to rescue the financial sector
from 2008 to 2014, Bloomberg recounts.

In their first test, Banca Monte dei Paschi di Siena SpA and
other two small Italian lenders requested a precautionary
recapitalization, which funnels government money to solvent banks
without sending them into resolution, Bloomberg discloses.  It
also addresses a capital gap in a stress test and imposes lower
losses than a full "bail-in" to investors, Bloomberg states.

"This is a process that is still underway," Mr. Mersch said in
the interview with Kevin Costelloe of Bloomberg News.  "The ECB
is involved from the point of view of supervision but we have a
strict separation between the supervisory side and the monetary
policy side.


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N E T H E R L A N D S
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DPX HOLDINGS: Moody's Assigns B2 Rating to $1.133BB Term Loan
-------------------------------------------------------------
Moody's Investors Service assigned B2 ratings to DPx Holdings
B.V.'s recently repriced $1.133 billion USD first lien term loan
due 2024 and EUR463 million EUR first lien term loan due 2024.
DPx Holdings is the primary operating subsidiary of
pharmaceutical outsourcing firm Patheon N.V. The transaction is
credit positive but has no impact on the company's B3 Corporate
Family Rating (CFR) or its stable outlook. The repricing will
push out the term loan maturities by 3 years. Moody's expects the
repricing of these term loans to generate approximately $3
million of interest savings to the company.

Ratings assigned:

DPx Holdings B.V.

Senior secured first lien USD Term Loan due 2024 at B2 (LGD 3)

Senior secured first lien EUR Term Loan due 2024 at B2 (LGD 3)

Ratings to be withdrawn upon close:

DPx Holdings B.V.

Senior secured first lien USD Term Loans due 2021 at B2 (LGD 3)

Senior secured first lien EUR Term Loans due 2021 at B2 (LGD 3)

RATINGS RATIONALE

The B3 CFR is constrained by Patheon's high financial leverage
and negative free cash flow. The rating also reflects high
execution risk associated with Patheon's aggressive acquisition
strategy. The company's earnings and cash flow are volatile due
to its significant fixed cost structure and the capital
intensiveness of its business. The rating also incorporates
Moody's concerns with broader challenges in the contract
manufacturing industry relating to pricing pressures and over
capacity in certain technology platforms.

The B3 CFR is supported by Patheon's large scale, strong
production capabilities and high level of customer and product
diversification, which are all important differentiating factors
in the fragmented CDMO industry. The ratings also reflects
Moody's expectation that demand for contract manufacturing
services will continue to growth over the long-term.

The stable outlook balances Moody's view of the firm's aggressive
financial policies, high financial leverage, and negative free
cash flow with its relatively good business prospects and
liquidity.

Moody's could upgrade the rating if it expects improvement in
profitability, lower earnings volatility and positive free cash
flow. Patheon would also need to demonstrate continued success in
managing its acquisition-led growth strategy. Adjusted debt to
EBITDA would also need to be sustained below 5.5 times for
Moody's to consider an upgrade.

Moody's could downgrade the rating if it expects free cash flow
to remain negative, liquidity to deteriorate, or if Patheon
encounters challenges in executing its acquisition strategy.

The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.

DPx Holdings B.V. is a leading global provider of outsourced
pharmaceutical development and manufacturing services. Sales are
approximately $1.9 billion. JLL Partners Inc. and Royal DSM N.V.
(A3 negative) own more than 70% of the company.


SYNCREON GROUP: Moody's Revises Outlook to Neg., Affirms B3 CFR
---------------------------------------------------------------
Moody's Investors Service changed syncreon Group Holdings B.V.'s
rating outlook to negative from stable and affirmed the company's
B3 Corporate Family Rating ("CFR") and B3-PD Probability of
Default Rating. The $525 million senior secured first lien term
loan at Syncreon Group B.V. was affirmed at B1, and the $225
million senior unsecured notes also at syncreon Group B.V. were
affirmed at Caa2. The outlook at syncreon Group B.V. was also
changed to negative.

"The negative outlook reflects worse than anticipated operating
performance and Moody's expectation for weak liquidity and credit
metrics over the next 12-18 months as syncreon faces near term
headwinds associated with investments in the company's recently
announced growth strategy" said Moody's Analyst Dan Altieri.
Moody's estimates lease adjusted leverage in the mid-6 times
range for the LTM period ended December 31, 2016, with interest
coverage (EBIT/Interest Expense) below 1 time. However leverage
for funded debt is in excess of 10 times.

The affirmation of the B3 CFR reflects the potential long term
benefits of the company's growth strategy that should support
topline growth driven by new and expanded contract wins. Moody's
also notes the additional equity contributed at syncreon's parent
company, syncreon Global Holdings Limited ("HoldCo"), could be
used to help fund expected investments in the business. However,
since HoldCo lies outside of the restricted group of the credit
facility, lenders do not have a claim on those assets (cash and
notes). As a result, Moody's did not consider those assets in
Moody's liquidity analysis.

syncreon's weak liquidity profile reflects Moody's expectation
for negative free cash flow over the next 12-18 months driven by
increased capital investments and SG&A costs associated with the
roll out of the company's growth strategy. Moody's expects
greater reliance on its $100 million revolving credit facility
will be required to fund this initiative, which will pressure
covenant compliance on its springing senior secured net leverage
test and result in higher cash interest expense. In addition, the
revolver expires in October 2018 so the company will need to
address this maturity (either through a repayment or maturity
extension) during a period of anticipated flat operating
performance and higher borrowings on the facility.

Moody's expects the company will trigger its springing senior
secured leverage covenant over the next 12-18 months and covenant
compliance will be highly dependent on the company's ability to
execute on its growth strategy as planned. If violated, cash
equity contributed from HoldCo could be used to cure the
violation, however, as noted previously, those funds are outside
the restricted group, and there are limitations on the number of
equity cures allowed per the terms of the credit agreement. As of
December 31, 2016 syncreon had approximately $4 million
outstanding on the facility with approximately $77 million
available for borrowing after accounting for letters of credit.
The covenant is tested when borrowings exceed $30 million.

Moody's took the following rating actions:

Issuer: syncreon Group Holdings B.V.

Corporate Family Rating, Affirmed at B3

Probability of Default Rating, Affirmed at B3-PD

Outlook, Changed to Negative from Stable

Issuer: syncreon Group B.V.

$525 million backed senior secured term loan due 2020 ($509
million outstanding), Affirmed at B1, LGD-2

$225 million 8.625% senior unsecured notes due 2021, Affirmed at
Caa2, LGD-5

Outlook, Changed to Negative from Stable

RATINGS RATIONALE

syncreon's B3 CFR reflects the company's weak liquidity, high
lease adjusted leverage, and weak interest coverage, as well as
Moody's expectation that credit metrics and liquidity will remain
under pressure over the next 12-18 months as the company rolls
out its growth strategy that will require increased capital
investments and SG&A costs. The rating also reflects the
company's heavy concentration in two industry segments
(technology and automotive) and an aggressive financial policy
that has resulted in high debt levels. The rating is supported by
Moody's expectation that syncreon will be able to add new and
expanded contracts, which should support topline growth. However,
the start-up of new operations requires time, and the
profitability in the initial phase of new operations can be
affected by inherent launch inefficiencies which will be another
headwind for near term earnings growth.

The B1 rating on the senior secured term loan due 2020 is two
notches above the B3 CFR. This reflects the senior position that
this class of debt holds in syncreon's capital structure, as well
as the substantial amount of senior unsecured debt, notably the
$225 million senior unsecured notes due 2021. This results in a
higher estimated recovery rate for this secured facility as
assessed using Moody's Loss Given Default ("LGD") methodology.

The Caa2 rating on the senior unsecured notes due 2021 is two
notches below the CFR, reflecting the substantial level of
secured debt that is senior in claim to these notes. Moody's
estimates that the notes would incur substantial loss in the
event of default, as implied by a Loss Given Default assessment
of LGD5.

Ratings could be downgraded if the company fails to execute on
its proposed growth strategy, if significant price concessions
are made to renew or win contracts, or if the company pursues
aggressive financial policies resulting in deteriorating
profitability or credit metrics sustained at current levels.
Specifically, a downgrade could be warranted if debt-to-EBITDA is
sustained above 6.5 times, or if FFO + Interest-to-Interest
weakens to 1.5 times or less, from currently just over 2.0 times.
A weakened liquidity position, including higher than anticipated
reliance on the credit facility, or concerns around covenant
compliance could also result in a ratings downgrade.

Given the negative outlook an upgrade over the near term is not
likely. However, over the longer term, the ability to expand the
company's revenue base, improvements in operating margins or de-
leveraging that would result in debt-to-EBITDA of less than 5.5
times and FFO + Interest-to-Interest approaching 3 times, along
with consistent positive free cash flow generation would be
factors that could lead to a rating upgrade. Likewise, if
syncreon can improve operating performance and demonstrate
consistent EBITDA growth resulting in interest coverage
(EBIT/Interest expense) sustained above 1.0 time, moderating
leverage, and an improved liquidity profile, the outlook could
stabilize.

The principal methodology used in these ratings was Global
Surface Transportation and Logistics Companies published in April
2013.

syncreon Group Holdings B.V. (`syncreon') is an international
provider of specialized logistics and supply chain solutions to
customers primarily in the technology and automotive sectors.
Revenues for the last 12 months ended December 31, 2016 were
approximately $931 million. The company is majority owned by
GenNx360 Capital Partners and Centerbridge Partners.


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R U S S I A
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ARCELORMITTAL: Fitch Revises Outlook to Stable, Affirms BB+ IDR
---------------------------------------------------------------
Fitch Ratings has revised the Outlook on ArcelorMittal's (AM)
Long-Term Issuer Default Rating (IDR) to Stable from Negative.
Fitch has also affirmed AM's Long-Term IDR and senior unsecured
rating at 'BB+'. The Short-Term IDR has been affirmed at 'B'.

The Outlook revision reflects better deleveraging prospects for
AM compared to a year ago, due to an improvement in the global
steel industry. As a result, the company is well placed to
achieve credit metrics in line with a 'BB+' rating before end-
2018. The recovery in the steel industry and positive debt
protection measures AM took in 2016 has resulted in a material
improvement in the company's financial profile. Fitch now expects
AM to use the bulk of its projected free cash flow of around USD1
billion in 2017 and 2018 for debt repayment.

KEY RATING DRIVERS

Improved Credit Metrics: In 2016, AM's FFO adjusted gross
leverage fell to 4.1x from 7.4x. The large drop in leverage is
because of an increase in reported EBITDA by 20% and AM's efforts
to strengthen its balance sheet which included a USD3 billion
rights issue, the USD1 billion sale of Gestamp and AM's 'Action
2020' plan.

Fitch expects EBITDA to be about USD7 billion through to end-2018
and working capital investment of USD1 billion in 2017. These
along with a resumption in dividend payments in 2018 should
result in FCF of about USD1 billion in both 2017 and 2018, a
majority of which would be used for debt repayments. This will
result in a gradual decrease in leverage to just below 3.5x in
2018.

End-Market Demand Positive: Fitch expects the underlying end-
market demand for AM's products in a majority of its core markets
to be strong in 2017. Fitch projects the strongest increase in
steel demand coming from the US and Brazil. Fitch expects AM's
total steel shipments in 2017 to increase to 85 million metric
tonnes from 84 million tonnes in 2016.

Stable Steel Outlook: Fitch changed the sector outlook for
Western Europe steel to stable for 2017 from negative in 2016.
This reflects Fitch views that demand for steel from key
consuming sectors will continue to grow and that imports of key
steel products have probably peaked. In the US Fitch expects an
improvement due to the end of the destocking phase of 2016, a
pick-up in the construction industry and an increase in
investment in energy sector as oil prices increase. Fitch
projections include a mild recovery in Brazil after a period of
contraction and a small increase in the CIS region.

Ore, Coal Drive Steel Prices: Fitch expects raw material price
movements to be the main driver for steel prices in 2017 and
forecast a gradual decline throughout the year, from current
highs. Steel prices have increased since November 2015; recent
price rises have been driven by an increase in raw material
prices, particularly coking coal. While Fitch are seeing positive
signs from anti-dumping measures, which Fitch believes may
support steel prices in the longer term, in the short term Fitch
expects changes in raw material prices to have a stronger impact
on prices.

Cost-Cutting Measures: AM outlined its "Action 2020" plan at the
start of last year, which includes further structural
improvements. This, together with previously announced cost-
cutting measures, is planned to result in a USD3 billion
improvement in EBITDA and annual free cash-flow generation of
USD2 billion. In 2016, the Action 2020 plan had a USD0.9 billion
impact on EBITDA. Fitch do believes that AM will be able to
achieve the targets set by this plan as the company has room for
cost improvements and has a good track-record in this regard --
as evident in its 2016 results.

Cash Outflows: Fitch expects the cash needs for the company to
increase in 2017, mainly due to an increase in capex to USD2.9
billion. Fitch projects a working capital outflow of USD1
billion -- in line with that of 2016. After 2017, Fitch projects
more moderate working capital outflows and capex to increase
gradually, reflecting the capital intensive nature of AM's
business. While Fitch currently do not expect AM's Fitch-adjusted
credit metrics to be in line with an investment grade rating over
the next two to three years, Fitch assumes in Fitch model that
the company will likely re-instate dividends in 2018.

Ilva Acquisition: In March, AM and Marcegaglia submitted an offer
for Ilva. If this transaction completes it will strengthen AM's
position in southern Europe. However in addition to the purchase
price, the deal will require AM and Marcegaglia to invest over
EUR2.3 billion.

Significant Scale and Diversification: The ratings continue to
reflect AM's position as the world's largest steel producer. AM
is also the world's most diversified steel producer in product
and geography, and benefits from a solid and increasing level of
vertical integration into iron ore.

DERIVATION SUMMARY

Compared to European Peers: The key rated European peer is
ThyssenKrupp (BB+/Stable). Like AM, ThyssenKrupp has a strong
market position in many of its segments and but has a relatively
higher value added product mix. ThyssenKrupp also has a portfolio
of capital goods related businesses which provides relative
stability. AM is more geographically diversified.
Compared to Russian Peers: The leading Russian steel companies
(NLMK, Severstal and MMK) are less diversified, low cost
integrated players with a lower value added product mix in
comparison to AM. However, the balance sheets of the Russian
steel companies are relatively strong, as they have benefited
from the weakening of the rouble relative to the US dollar; this
is reflected in their higher ratings.

KEY ASSUMPTIONS

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

- Total shipments increase to around 85 million metric tonnes;
- Average selling price slightly higher in 2017;
- Continued reduction in cash costs going forward to support
   profitability;
- Iron ore price of USD55/t in 2017 and USD45/t thereafter;
- Capex of USD2.9 billion in 2017;
- Dividends reinstated in 2018.

RATING SENSITIVITIES

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

- FFO gross leverage below 3.0x
- Recovery in EBIT margins to at least 8%
- Positive FCF across the cycle

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

- EBIT margin below 4%
- FFO gross leverage sustained above 3.5x
- Persistently negative free cash flow

LIQUIDITY

At December 31, 2016, AM had a cash of USD1.5 billion (Fitch has
adjusted reported cash position by USD1 billion, which relates to
non-readily available cash) and undrawn long-term credit lines of
USD5.5 billion, or which USD2.3 billion matures in December 2019
and USD3.2 billion in December 2021. This is more than adequate
to cover its short-term debt of USD1.9 billion. Fitch views AM's
liquidity as strong and supportive for the ratings, given that
the company is actively managing its debt maturity profile and
paying down debt as evident in the recent bond redemption.


GLOBALTRANS INVESTMENT: Moody's Raises CFR to Ba2, Outlook Stable
-----------------------------------------------------------------
Moody's Investors Service has upgraded to Ba2 from Ba3 the
corporate family rating (CFR) and to Ba2-PD from Ba3-PD the
probability of default rating (PDR) of Globaltrans Investment
PLC, one of the largest freight and logistics rail transportation
groups operating in Russia and the Commonwealth of Independent
States. The outlook on all the ratings is stable.

"Our decision to upgrade Globaltrans' ratings reflects its strong
financial performance thanks to its business model, which proved
to be relatively resilient to the market downturn in Russia. The
upgrade is also an acknowledgement of the clearly articulated and
balanced dividend policy, which the company made public at the
end of March this year", says Julia Pribytkova, a Vice President
-- Senior Analyst at Moody's.

RATINGS RATIONALE

The upgrade of Globaltrans' CFR to Ba2 with stable outlook
reflects the strengthening of its credit metrics as a result of
substantial deleveraging over 2015-16. Thanks to its business
model, whereby two-thirds of net revenues from operations of
rolling stock come from long-term service contracts, of which the
largest are with PJSC Oil Company Rosneft (Ba1 stable), JSC
Holding Company METALLOINVEST (Ba2 stable) and Magnitogorsk Iron
& Steel Works (Ba1 stable). These contracts allowed Globaltrans
to maintain stable freight transportation volumes during Russia's
recent recession and defend its profitability at a time when
gondola railcar daily rates came under pressure as a result of
railcar surplus on the market.

Globaltrans' modern railcar fleet (43,276 gondola cars, 22,475
tank cars, 75 locomotives and 2,685 other railcars including
petrochemical tank containers) with an average age of owned fleet
of 10.3 years at the end of 2016, is minimally impacted by the
new regulation that prescribes a compulsory scrappage of railcars
by operators after the expiry of their useful life (22 years for
gondola cars and 32 years for tank cars). While detrimental for
owners of older fleets, the law drove a significant reduction in
gondola cars numbers and a subsequent upsurge in daily rates. A
slowdown in domestic production of new railcars and a recovery in
demand for transportation of non-oil cargoes, allowed Globaltrans
to grow revenue and deliver solid profitability. Moody's expects
rates for universal gondola cars, mostly used for metals and
other bulk products to further rise in 2017-18, as around 20,000
gondola cars (4% of overall gondola fleet) will reach the end of
their useful life in 2017, and new additions will likely be
limited. Tank car segment will continue to suffer in 2017 despite
continued scrappage (around 14,000 tank cars, or 5% of overall
tank fleet in 2017) due to the weak demand as more oil and oil
products are transported via newly-launched pipelines, and
refined oil products output is on the decline.

Moody's expects Globaltrans' Moody's-adjusted operating margin to
recover to 17%-19% during 2017-18, thanks to an increase in
revenue, driven by higher rates and growth in freight turnover.
Along with a material reduction in debt, the improvement in
operating margin will positively affect coverage and leverage
metrics, which will, however, mostly remain in the same rating
categories.

Globaltrans' leverage, measured by adjusted debt/EBITDA, improved
to 1.2x as of end-2016 as a result of a reduction in debt.
Moody's expects it to remain at this or lower level in the next
12-18 months as the company's current investment plan is modest
and envisages generation of a positive free cash flow.

The agency notes that Globaltrans intends to pay a higher-than-
average dividend in 2017 in the amount of RUB7.0 billion to
compensate for lower payments in the previous two years (nil in
2015, RUB2.2 billion in 2016). The distribution will be funded
with cash balances of around RUB4.8 billion as of end-2016, and
the company's ample committed credit facilities. Going forward
Moody's expects the company to distribute dividends in line with
its recently announced dividend policy, which links the
distributable amount to the company's leverage and availability
of funding for basic cash obligations including debt payments,
and business expansion. The policy specifically mentions
maintenance of the company's credit ratings as one of the
considerations when determining the level of shareholder
distributions.

RATIONALE FOR THE STABLE OUTLOOK

The stable outlook reflects the agency's view that Globaltrans is
adequately positioned in its rating category.

WHAT COULD CHANGE THE RATING UP/DOWN

Given Globaltrans' scale of operations (annual revenue of $1.2-
$1.5 billion), there is a limited potential for an upgrade to a
higher Ba category at this stage. A material increase in scale of
operations alongside maintenance of robust credit metrics and
conservative financial policy could put positive pressure on the
rating over time.

Conversely, Globaltrans' rating could be downgraded if the
company's liquidity profile, and operating and financial
performance materially deteriorate, with debt/EBITDA increasing
above 2.5x (Moody's-adjusted) on a sustained basis.

The principal methodology used in these ratings was Global
Surface Transportation and Logistics Companies published in April
2013.

Globaltrans Investment PLC is one of the largest freight and
logistics rail transportation groups operating in Russia and the
Commonwealth of Independent States. In 2016, the company
generated approximately RUB69.5 billion of revenue and RUB18.5
billion of EBITDA (Moody's-adjusted). Globaltrans is a public
company that has been listed on the London Stock Exchange since
2008. The company is 40.8% owned by its co-founders, 0.2% by
management and independent directors, and 59% is in free float.


VSK INSURANCE: Fitch Rates RUB4BB Senior Unsecured Bonds BB-
------------------------------------------------------------
Fitch Ratings has assigned Russia-based VSK Insurance Joint Stock
Company's (VSK) RUB4 billion issue of senior unsecured bonds a
'BB-'rating. The bonds are rated in line with VSK's Issuer
Default Rating (IDR) of 'BB-', which has a Stable Outlook, to
reflect average recovery expectations, in line with Fitch's
notching criteria.

VSK issued RUB4 billion bonds on 11 April 2017. The bonds have a
five-year maturity and carry a coupon of 11.05%. The proceeds
from the bonds are expected to be used by VSK to support further
growth.

KEY RATING DRIVERS

Fitch have applied a baseline recovery assumption of 'average' to
the bonds, as they constitute senior and unsecured obligations of
the company. As a result, the rating of the bonds is aligned with
VSK's 'BB-' IDR.

Prior to the issuance of the bonds, VSK did not hold any long-
term debt. Based on provisional end-2016 results, the issuance of
this debt will result in a financial leverage ratio of around
21%, and a fixed charge coverage ratio of around 12x. Based on
five-year average earnings, the fixed charge coverage ratio would
be around 5x. Therefore Fitch's assessment is that VSK's
financial leverage and debt service capabilities remain
supportive of its ratings.

RATING SENSITIVITIES

The rating of the bonds is subject to the same sensitivities that
may affect VSK's Long-Term IDR.


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


BBVA CAPITAL: S&P Affirms BB- Rating on Preferred Stock
-------------------------------------------------------
S&P Global Ratings said that it has revised to positive from
stable its outlook on the long-term ratings on Spain-based Banco
Bilbao Vizcaya Argentaria S.A. (BBVA) and its core subsidiary
BBVA Global Markets B.V.  At the same time, S&P affirmed its
long- and short-term counterparty credit ratings on both entities
at 'BBB+/A-2'.

S&P also revised to positive from stable its outlook on the long-
term ratings on Santander Consumer Finance S.A. (SCF), a highly
strategic subsidiary of Banco Santander S.A., and that of its
German-based core subsidiary Santander Consumer Bank AG (SCB).
S&P also affirmed its long- and short-term counterparty credit
ratings on both entities at 'BBB+/A-2'.

                            RATIONALE

BBVA AND BBVA GLOBAL MARKETS

The rating action follows S&P's positive outlook revision on
Spain on March 31, 2017.  A strengthening of Spain's sovereign
creditworthiness would mean that, if BBVA's stand-alone
creditworthiness improved, S&P could raise the long-term rating
on BBVA as it would not be constrained by our assessment of
Spain's creditworthiness.

In turn, the outlook revision on BBVA results in the same action
on core subsidiary BBVA Global Markets, whose ratings are
equalized to and move in tandem with those on its parent.

At present, S&P's stand-alone credit profile (SACP) for BBVA
stands at 'bbb+', reflecting the bank's strong and geographically
diversified retail banking profile, sound and resilient operating
profitability, and solid capitalization compared to its risk
profile.  These strengths are balanced by the higher-than-average
economic risk of the countries in which BBVA operates, as well as
by the still-weak profitability of its Spanish operations, which
account for about half of its asset base.

In S&P's view, BBVA's SACP could improve if risks in the domestic
environment were to ease, while emerging risks in other
markets -- namely Turkey and Mexico -- remain under control, or
if S&P was to improve its assessment of industry risks in the
Spanish banking system.  S&P's assessment of both the Spanish
banking system's economic and industry risks currently carry
positive trends.  The materialization of any of these positive
trends would very likely lead, all other things being equal, to
an improvement in BBVA's anchor to 'bbb' and thus to a stronger
SACP for the bank.

Until now, S&P had a stable outlook on BBVA because, in S&P's
view, despite acknowledging that the bank's creditworthiness
could improve in the context of a potentially more supportive
economic and operating environment in Spain, BBVA's high business
concentration in the country -- which accounts for almost half of
its loan book -- means it would be unlikely that the bank would
continue to meet its obligations in a timely manner in the
hypothetical event of a Spanish sovereign default.

S&P's outlook on BBVA's U.S. intermediate holding company, BBVA
Compass Bancshares, Inc. (BBB+/A-2), remains stable and is not
affected by BBVA's outlook revision to positive.  S&P would not
upgrade BBVA Compass if its parent was upgraded to 'A-' because,
as a highly strategic subsidiary, S&P would still cap BBVA
Compass' rating at its unsupported group credit profile of
'bbb+'. This assessment reflects BBVA Compass' solid market
position as a Texas-based regional banking company with $87
billion in assets, its strong capital ratios, and S&P's
expectation that its asset quality will continue to stabilize
because of reduced energy loan exposures and the improved energy
pricing environment.

                             SCF AND SCB

The outlook revision on SCF follows a similar revision on the
outlook on Spain.  A potential strengthening of Spain's sovereign
creditworthiness would facilitate an upgrade of SCF if its parent
company, Banco Santander was also upgraded.

SCF is a highly strategic subsidiary of Banco Santander and, as
such, the ratings on SCF stand one notch below the parent's 'a-'
group credit profile (GCP).  In S&P's view, there is potential
for the ratings on Banco Santander and its GCP to improve as the
bank progresses with its plan to build a large buffer of
instruments eligible to absorb losses in resolution.  If that
were the case, SCF would also be eligible for an upgrade, but for
that to happen the sovereign credit ratings on Spain would also
have to be raised.  That is because, based on group support, S&P
would not rate noncore subsidiaries above the sovereign ratings
on the country where they are based, unless they have less than
10% exposure to that jurisdiction which SCF moderately exceeds.
The outlook revision on Spain therefore increases the likelihood
that S&P could raise the long-term rating on SCF in the next 12-
24 months.

The outlook revision of SCB mirrors the action on its parent SCF.
S&P sees SCB as a core subsidiary of SCF and, as such, S&P
expects the ratings to move in tandem with those on its parent.

                              OUTLOOK

BBVA

The positive outlook on BBVA reflects the possibility that S&P
could raise the long-term rating over the next 12-24 months if
these two conditions are met:

   -- The bank's creditworthiness strengthens, driven either by a
      more supportive economic environment at home, while
      emerging risks in other markets -- namely Turkey and Mexico
      -- remain under control; or by an improvement of S&P's
      assessment of Spain's banking system industry risks, most
      likely because of lower funding risks; and

   -- Spain is upgraded.

Conversely, the outlook could be revised back to stable if S&P no
longer sees the two positive developments cited above
materializing.

                               SCF

The positive outlook on SCF mirrors the outlook on its parent,
Banco Santander, as well as the positive outlook on Spain.  It
therefore reflects the possibility that S&P could raise the long-
term rating on SCF in the next 12-24 months if the ratings on its
parent and Spain were raised.

The outlook could be revised back to stable if S&P perceives that
either Banco Santander or Spain were unlikely to be upgraded.

                                SCB

The positive outlook on SCB mirrors that on its parent SCF.  If
S&P was to upgrade SCF, S&P would also likely upgrade SCB as S&P
expects it to remain a core subsidiary for its parent.  The
outlook could be revised to stable if a similar action was taken
on SCF.

RATINGS LIST

Ratings Affirmed; Outlook Action
                                        To                 From
BBVA Global Markets B.V.
Banco Bilbao Vizcaya Argentaria S.A.
Santander Consumer Bank AG
Santander Consumer Finance S.A.
Counterparty Credit Rating        BBB+/Pos./A-2  BBB+/Stable/A-2

Ratings Affirmed

Banco Bilbao Vizcaya Argentaria S.A.
Senior Unsecured                       BBB+
Subordinated                           BBB-
Certificate Of Deposit                 A-2
Commercial Paper                       A-2
Certificate Of Deposit                 BBB+/A-2

BBVA Global Markets B.V.
Senior Unsecured [1]                   BBB+
Senior Unsecured [1]                   BBB+p

B.B.V. Finance (DE) Inc.
Commercial Paper [1]                   A-2

BBVA Capital Finance, S.A. Unipersonal
Preferred Stock [1]                    BB-
Preference Stock [1]                   BB-

BBVA Commercial Paper Ltd.
Commercial Paper [1]                   A-2

BBVA Global Finance Ltd.
Senior Unsecured [1]                   BBB+
Subordinated [1]                       BBB-

BBVA International Ltd.
Preference Stock [1]                   BB-

BBVA International Preferred, S.A. Unipersonal
Preferred Stock [1]                    BB-

BBVA Senior Finance, S.A. Unipersonal
Senior Unsecured [1]                   BBB+
Senior Unsecured [1]                   BBB+p

BBVA Subordinated Capital, S.A. Unipersonal
Subordinated [1]                       BBB-

BBVA U.S. Senior, S.A. Unipersonal
Commercial Paper [1]                   A-2

Bex America Finance Inc.
Commercial Paper [1]                   A-2

Santander Consumer Finance S.A.
Senior Unsecured                       BBB+
Commercial Paper                       A-2

Santander Consumer Bank AS
Senior Unsecured [2]                   BBB+

[1] Guaranteed by Banco Bilbao Vizcaya Argentaria S.A.
[2] Guaranteed by Santander Consumer Finance S.A.


===========
T U R K E Y
===========


ANTALYA: Fitch Revises Outlook to Negative, Affirms BB+ IDR
-----------------------------------------------------------
Fitch Ratings has revised the Outlook on the Metropolitan
Municipality of Antalya to Negative from Stable and affirmed its
Long-Term Foreign- and Local-Currency Issuer Default Ratings
(IDR) at 'BB+'. Fitch has affirmed the National Long-Term rating
at 'AA+(tur)' and Short-Term Foreign- and Local-Currency IDRs at
'B'.

The revision of the Outlooks to Negative reflects Antalya's
expected high capex and weaker than expected budgetary
performance. This was caused by a deteriorating current balance
in light of the weakening national and local economic
performance. The revision also factors in the increasing interest
costs and a capex-induced rise in debt, leading to a large
budgetary deficit before financing.

KEY RATING DRIVERS

The Outlook revision reflects the following rating drivers and
their relative weights:

HIGH

Fitch expects the operating margin will decrease on average to
18% yoy (2016: 24%) on the back of opex pressure, which Fitch
estimate to surpass the operating revenue growth at a CAGR of
2.7% in 2017-2019. Subdued local economic growth will not be
conducive to generating strong fiscal revenues to offset the hike
in opex.

A weakened operating balance and increasing interest costs as a
result of a capex-induced debt increase means the current balance
will be under pressure and cover on average 23% of the expected
capex (2016: 41%). This will lead to a large budget deficit
before financing, averaging 18% of total revenue.

At end-2016, opex had increased 36% yoy due to a continued
increase in staff and goods and services costs mainly related to
its new responsibilities as well as one-off costs for EXPO 2016.
However, operating revenue growth remained subdued at 10% due to
adverse effects from the national economy.

Significant capex led to a large deficit before financing at 23%
of the total revenue in 2016. In Fitch's view, strict control of
opex and moderate capex, coupled with continued moderate
operating revenue growth, would help decrease the deficit before
financing to 5% of total revenue over the medium term.

Fitch expects a more challenging operating environment for
Antalya compared with its international peers as a result of the
weakening national economic performance due to political
volatility and security challenges. This will have a greater
adverse effect on local economic activities given the high
reliance on tourism. Antalya is the nation's sixth-largest GDP
contributor, but the concentration of its local economy on
tourism and agriculture makes the city more vulnerable to adverse
shocks.

According to official statistics, foreign tourist arrivals
dropped further by 8.12% yoy in the first two months of 2017. On
average, Antalya hosts 30% of Turkey's tourist arrivals and the
services sector contributes 70% to its local GDP.

MEDIUM

Fitch expects direct debt to increase moderately, to 55% of the
current revenue over the medium term (2016: 46%), driven by the
increased capex investments prior to the upcoming elections.
However, an expected weaker operating balance and increasing
interest costs will put pressure on the current balance. This
will lead to a direct debt to current balance, which is a measure
of debt sustainability, to increase to an average 3.4 years in
2017-2019, which is still in line with the 'BB' category.

Expected currency volatility could increase the fiscal pressure
on the debt servicing costs of its unhedged FX liabilities, which
will make up 74% of its total debt stock in 2017-2019, in the
wake of the weakened current balance. The projected annual
external debt servicing costs under the expected Turkish lira
depreciation will absorb a relatively high share of expected
current balance on average 20%, but this would be still
manageable for Antalya.

The relatively lengthy weighted average maturity of Antalya's
external debt, at about 12.5 years, and predictable monthly cash
flows with a Treasury repayment guarantee mitigate any immediate
refinancing risk.

Antalya's ratings also reflect the following key rating drivers:

Antalya's credit profile is constrained by the weak Turkish
institutional framework, reflecting a short track record of a
stable intergovernmental relationship between the central
government and the local governments with regard to allocation of
revenues and responsibilities in comparison with their
international peers.

RATING SENSITIVITIES

A sharp increase in local and external debt with an increase of
debt to current revenue above 60% and an inability to restore the
budget deficit below 5% of the total revenue over the near term
could prompt a downgrade. A downgrade of the sovereign could also
put Antalya's ratings under pressure.


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NAFTOGAZ OF UKRAINE: Fitch Affirms CCC LT Issuer Default Ratings
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Fitch Ratings has affirmed NJSC Naftogaz of Ukraine's (Naftogaz)
Long-Term Foreign-and Local-Currency Issuer Default Ratings (IDR)
at 'CCC'.

Naftogaz's financial profile has improved over the last year as
the state has brought domestic natural gas prices in line with
the import parity level; further, in 2016 the company did not
require cash injections from the state for the first time in
recent years. Fitch also note improvements regarding Naftogaz's
corporate governance. Naftogaz's rating is currently constrained
by legal risks related to its multi-billion dollar litigations
with Gazprom, worsening collectability of accounts receivables
and some uncertainty regarding its financial structure after the
planned unbundling of the natural gas transit segment into a
separate company.

Naftogaz is Ukraine's major natural gas production, supply and
transit company. In 2016, it produced 15.9 billion cubic meters
(bcm) of gas and imported 8.2bcm from the EU.

KEY RATING DRIVERS

Litigation with Gazprom: Naftogaz's strained relations with its
former major supplier PAO Gazprom (BBB-/Stable) mirror the
political tensions between Russia and Ukraine and negatively
affect Naftogaz's credit quality. The Stockholm Arbitration Court
is considering two cases initiated by both Naftogaz and Gazprom
against each other, with the final decisions being expected in
2Q17.

The outcome of the proceedings will have a significant impact on
Naftogaz's financial position, and is currently the major risk
for the company. Gazprom's claims against Naftogaz amount to
around USD46 billion, while Naftogaz's counterclaims total USD30
billion.

Improved Cash Flows: Naftogaz's cash flow generation ability
significantly improved in 2016 as the state proceeded with the
liberalisation of natural gas prices. In 2016, Naftogaz's
standalone funds from operations increased to around USD1.4
billion, from USD93 million in 2015; its free cash flow improved
to USD1.1 billion, compared to a negative USD756 million in 2015.
In 2012-14 the company's operating cash flows were consistently
negative due to a disparity between imported and average domestic
gas prices. However, this progress was somewhat offset by the
worsening collectability of accounts receivables from households
and heat generation utilities.

Naftogaz's further financial performance will depend on the
company's ability to improve the collectability of accounts
receivables, and the government's commitment to maintain domestic
natural gas prices in line with imported gas prices. These
factors will be increasingly important in 2018, when management
expects its highly profitable natural gas transit segment to be
spun off into a separate company.

Public Service Obligations: As an interim measure, Naftogaz is
obliged to supply gas to certain groups of customers under the
Public Service Obligation (PSO) regime. This means that Naftogaz
is legally prevented from disconnecting its non-paying customers,
which negatively affects the collectability of receivables.
Naftogaz expects the PSO regime to be cancelled in 2018; however,
Fitch believes that there is a risk that the regime could be
extended, as the issue is politically sensitive.

Upcoming Reorganisation: Ukraine's government has committed to
reform the energy sector, in line with the EU Third Energy
Package; this implies marked liberalisation and the unbundling of
the trading and production functions from gas transit.

Naftogaz expects that the gas transit function will be handed
over to a separate company outside of the Naftogaz consolidation
perimeter in early 2018; this will deprive Naftogaz of around
USD2 billion in transit fees and USD1 billion in EBITDA. It is
not yet clear whether Naftogaz will receive compensation for the
transfer, and whether the company's debt portfolio will be split.
This creates risks for Naftogaz's financial position in 2018 and
beyond.

Improving Corporate Governance: Naftogaz is undergoing a
corporate governance reform, which is having a positive impact on
the company's credit quality. Naftogaz has established a
supervisory board, with a majority of independent directors. The
transparency of its information has improved, and the company has
started to publish regular operational updates, as well as
detailed annual reports. Naftogaz has also replaced the
management teams in its key subsidiaries, to have more
operational and strategic control over them.

Links With the State: Naftogaz is controlled by the state and is
strategically important to Ukraine as the largest national gas
trader and producer in the country. The state guarantees a
significant part of Naftogaz's debt, and its performance is
closely monitored by IMF, Ukraine's major lender, which creates
incentives for the state to keep Naftogaz adequately funded. In
the past, the state has supported Naftogaz financially, and Fitch
expects the government to step in should the need arise (eg if
the collectability of accounts receivables worsens).

DERIVATION SUMMARY

Fitch rates Naftogaz on a standalone basis. The links of the
company with the state remain strong; however, Fitch do not
equalise the ratings in view of the legal risks related to
Naftogaz's multi-billion dollar litigation with Gazprom, as well
as some uncertainty around its financial structure after the
planned unbundling. The company's financial position improved in
2016 as the state adjusted domestic natural gas prices in line
with the import parity level; however, the collectability of
accounts receivables worsened, which somewhat offset these
achievements.

KEY ASSUMPTIONS

Fitch's key assumptions within Fitch ratings case for the issuer
include:
- Domestic natural gas tariffs remain broadly in line with the
import parity level

- USD/UAH: 25.6 in 2016; 27.9 in 2017 and 29.3 in 2018
- Gradual progress with the receivables collectability issue
- No massive fines or penalties imposed as a result of the
   dispute with Gazprom
- Unbundling of the transit business in early 2018

RATING SENSITIVITIES

Future developments that may, individually or collectively, lead
to negative rating action include:

- unfavourable resolution of the legal dispute with Gazprom
- deteriorating liquidity
- reversal of the progress made as regards market liberalisation
   eg due to domestic political pressure

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

- favourable resolution of the legal dispute with Gazprom
- removal of uncertainty regarding Naftogaz's financial
   structure, after the unbundling of the natural gas transit
   segment
- continued indexation of domestic gas prices, in line with the
   import parity level
- improved receivables collection process, leading to
   consistently positive free cash flow in the trading segment

LIQUIDITY

Liquidity Improved But Stretched: Naftogaz's liquidity has
improved on the back of positive free cash flow in 2016, but
remains stretched. At end-2016, its standalone cash balances were
at UAH17.7 billion (USD650 million) compared to short-term debt
of UAH44.9 billion (USD1.7 billion). Fitch expects that Naftogaz
will continue to service its external debt, including the USD835
million Gazprombank loan due 2018 and the recently received
USD300 million EBRD and USD500 million World Bank credit lines.
Fitch also expects that Ukraine's domestic banks will refinance
Naftogaz's loans falling due, as has been the case in recent
years.

FULL LIST OF RATING ACTIONS

NJSC Naftogaz of Ukraine
Long-Term Foreign-Currency IDR: affirmed at 'CCC'
Long-Term Local-Currency IDR: affirmed at 'CCC'


PRIVATBANK: Finance Ministry to Finalize Rehabilitation Plan
------------------------------------------------------------
Interfax-Ukraine reports that Ukraine's Finance Ministry by late
May would approve the final steps to complete rehabilitation of
PrivatBank.

This is outlined in the action plan approved by the Cabinet of
Ministers of Ukraine at a government meeting on April 12 to
implement the letter of intent of the government and the National
Bank of Ukraine (NBU) sent to the International Monetary Fund
(IMF) and the memorandum of economic and financial policies dated
March 2, 2017, Interfax-Ukraine discloses.

According to Interfax-Ukraine, the action plan to finish
rehabilitation of the financial institution drawn up on the basis
of the comprehensive inspection and the business plan of the bank
drafted by its supervisory board and the board of directors would
include the coverage of the bank's need in capital.

The Ukrainian government on December 18, 2016 decided to
nationalize Ukraine's No. 1 bank, Dnipro-based PrivatBank,
Interfax-Ukraine recounts.  It became wholly owned by the state,
Interfax-Ukraine notes.  After the government became its owner,
the Finance Ministry additionally injected UAH 116.8 billion into
it, including UAH 9.8 billion in 2017, Interfax-Ukraine
discloses.

Early in February 2017, PrivatBank CEO Oleksandr Shlapak did not
rule out there could be additional capitalization after the audit
of its capital, Interfax-Ukraine states.

                        About PrivatBank

PrivatBank is the largest commercial bank in Ukraine, in terms of
the number of clients, assets value, loan portfolio and taxes
paid to the national budget.  PrivatBank has its headquarters in
Dnipropetrovsk, in central Ukraine.

                          *   *   *


The Troubled Company Reporter-Europe reported on April 12, 2017,
that Moody's Investors Service downgraded the long-term foreign-
currency senior unsecured debt rating of Privatbank to C from Ca.
The bank's baseline credit assessment ("BCA"), adjusted BCA, long
and short-term local and foreign currency deposit ratings, and
its long and short-term Counterparty Risk Assessments were
unaffected by rating action.

The downgrade of Privatbank ' senior unsecured debt rating to C
from Ca primarily reflects Moody's expectation that senior debt
holders will sustain material losses as a result of bail-in and
conversion into equity.

The C senior unsecured debt rating does not carry outlooks.
Moody's will then withdraw the C foreign currency senior
unsecured debt rating of Privatbank.

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


PRIVATBANK: Ex-Owners Responsible for Fraudulent Transactions
-------------------------------------------------------------
bne IntelliNews reports that former owners of Ukraine's
PrivatBank, oligarchs Ihor Kolomoisky and Hennady Boholyubov,
were responsible for more than UAH16 billion (EUR561 million) in
fraudulent transactions performed the "last night" before the
lender's nationalization last December, National Bank of Ukraine
(NBU) governor Valeriya Gontareva alleged on April 10.

In December, the government announced the nationalization of
PrivatBank after it failed to fulfill a three-year
recapitalisation plan, bne IntelliNews recounts, bne IntelliNews
dislcoses.  The bank was found to have a UAH148 billion (EUR5.1
billion) hole in its balance sheet as of early December, at the
time said to be almost entirely due to related party financing.
Privatbank's owners have always denied any wrongdoing, bne
IntelliNews relays.

According to bne IntelliNews, Mr. Gontareva also told a news
briefing that the post-nationalisation audit of the bank
established that not 97%, but 100% of the corporate portfolio was
issued to related parties.

To cover the capital shortfall the Ukrainian government injected
capital of UAH117 billion (EUR4.1 billionn) and bailed-in
PrivatBank's non-deposit unsecured creditors for the amount of
UAH29.4bn ($1.1bn), including bondholders for the amount of
US$595 million, bne IntelliNews discloses.

Meanwhile, NBU deputy governor Kateryna Rozhkova said the results
of PrivatBank's audit will be published late April or early May,
bne IntelliNews relates.

                     About PrivatBank

PrivatBank is the largest commercial bank in Ukraine, in terms of
the number of clients, assets value, loan portfolio and taxes
paid to the national budget.  PrivatBank has its headquarters in
Dnipropetrovsk, in central Ukraine.

                          *   *   *


The Troubled Company Reporter-Europe reported on April 12, 2017,
that Moody's Investors Service downgraded the long-term foreign-
currency senior unsecured debt rating of Privatbank to C from Ca.
The bank's baseline credit assessment ("BCA"), adjusted BCA, long
and short-term local and foreign currency deposit ratings, and
its long and short-term Counterparty Risk Assessments were
unaffected by rating action.

The downgrade of Privatbank ' senior unsecured debt rating to C
from Ca primarily reflects Moody's expectation that senior debt
holders will sustain material losses as a result of bail-in and
conversion into equity.

The C senior unsecured debt rating does not carry outlooks.
Moody's will then withdraw the C foreign currency senior
unsecured debt rating of Privatbank.

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


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U N I T E D   K I N G D O M
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FOUR SEASONS: Mulls Sale of Huntercombe Group to Cut Debt
---------------------------------------------------------
City A.M. reports that Four Seasons Healthcare, Britain's largest
care home operator, is planning to sell its mental health
division, Huntercombe Group.

This forms part of an overall restructuring effort to gain long-
term financial security for the firm, City A.M. notes.

The sale is predicted to bring in tens of millions of pounds and
reduce Four Seasons' debt of more than GBP500 million,
City A.M. says.  It faces an annual debt interest bill of around
GBP50 million, City A.M. discloses.

Advisory firm PJT Partners is working on the restructuring
process and has been hired to deal with the Huntercombe sale,
City A.M. relays, citing Sky News.

The restructuring is due to cost pressures rising from the
introduction of the National Living Wage, local authority funding
constraints and a shortage of nursing staff, City A.M. states.

According to City A.M., one of the expected bidders for
Huntercombe is Elysium, which acquired the hospital chain Priory
last year.

Four Seasons, as cited by City A.M., said it currently has enough
funds to meet creditors' demands for the time being, but analysts
have said it is likely the company will be passed off to its
lenders in the future.



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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,
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Peter A. Chapman, Editors.

Copyright 2017.  All rights reserved.  ISSN 1529-2754.

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