TCREUR_Public/170608.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

          Thursday, June 8, 2017, Vol. 18, No. 113


                            Headlines


B U L G A R I A

PLOVDIV CITY: S&P Affirms 'BB+' ICR & Revises Outlook to Positive
SOFIA CITY: S&P Affirms 'BB+' ICR & Revises Outlook to Positive
STARA ZAGORA: S&P Revises Outlook to Positive & Affirms 'BB+' ICR


F R A N C E

NOVARTEX SAS: S&P Lowers CCR to 'SD' on Announced Exchange Offer


G E R M A N Y

AUCTIONATA: German Startups Buys Livestream Auction Technology
UNITYMEDIA GMBH: Hessen Transaction No Impact on Moody's B1 CFR


I R E L A N D

ALLIED IRISH: Moody's Ups Pref. Stock Non-cumulative Rating to B1
HALCYON LOAN 2017-1: Moody's Assigns (P)B2 Rating to Cl. F Notes


I T A L Y

ALBAZZURRA HOTEL: July 19 Bid Submission Deadline Set
ILVA SPA: Business to be Acquired by Arcelormittal for EUR1.8BB
POPOLARE DI VICENZA: Italy Working on Recapitalization
SEGUE: Official Receiver Announces July 4 Asset Sale


N O R W A Y

NORSKE SKOG: S&P Cuts CCR to 'CC' on Debt Exchange Offer


R U S S I A

BANK URALSIB: Moody's Hikes Long-Term Deposit Ratings to B3
LOCKO-BANK: Moody's Hikes Deposit Ratings to B1, Outlook Stable
SOVCOMFLOT PAO: Fitch Alters Outlook to Pos. & Affirms BB IDR


S P A I N

BANCO POPULAR ESPANOL: To Be Acquired by Santander for EUR1
BANCO POPULAR ESPANOL: Moody's Cuts Unsec. Debt Rating to B3


U N I T E D   K I N G D O M

LANSDOWNE MORTGAGE NO. 1: Fitch Affirms CC Ratings on 4 Tranches
SAAD INVESTMENTS: June 14 Creditors Meeting Set


                            *********



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


PLOVDIV CITY: S&P Affirms 'BB+' ICR & Revises Outlook to Positive
-----------------------------------------------------------------
S&P Global Ratings revised its outlook on the Bulgarian city of
Plovdiv to positive from stable.  At the same time, S&P affirmed
its 'BB+' long-term issuer credit rating on the city.

As a "sovereign rating" (as defined in EU CRA Regulation
1060/2009 "EU CRA Regulation"), the ratings on the city of
Plovdiv are subject to certain publication restrictions set out
in Art 8a of the EU CRA Regulation, including publication in
accordance with a pre-established calendar.  Under the EU CRA
Regulation, deviations from the announced calendar are allowed
only in limited circumstances and must be accompanied by a
detailed explanation of the reasons for the deviation.  In this
case, the reason for the deviation is the revision of S&P's
outlook on the Republic of Bulgaria to positive from stable on
June 2, 2017.  The next scheduled publication date for S&P's
rating on Plovdiv is Aug. 25, 2017.

                              OUTLOOK

The positive outlook on Plovdiv mirrors that on Bulgaria.

Upside Scenario

Any rating action S&P takes on the sovereign in the next 12
months would likely be followed by a similar action on Plovdiv.

Downside Scenario

S&P would revise the outlook to stable following a similar action
on Bulgaria.  S&P views a downside scenario based on Plovdiv's
stand-alone credit profile (SACP) as unlikely, since the SACP is
higher than the long-term rating on the city.  S&P would revise
its assessment of Plovdiv's SACP downward if S&P saw
deterioration in the city's financial performance, which could
result in debt accumulation beyond S&P's base-case scenario or
depletion of cash reserves such that they no longer cover yearly
debt service.

                          RATIONALE

The outlook revision on Plovdiv follows that on Bulgaria on
June 2, 2017.

The long-term rating on Plovdiv primarily reflects S&P's 'BB+'
long-term sovereign credit rating on Bulgaria.  S&P do not
consider that the city meets the conditions under which S&P would
rate a local or regional government (LRG) higher than the related
sovereign.  S&P consequently caps the long-term rating on Plovdiv
at the level of S&P's long-term rating on Bulgaria.  In S&P's
opinion, Bulgarian cities, including Plovdiv, are not able to
maintain more resilient credit characteristics than the sovereign
in a stress scenario.  In particular, S&P views their autonomy to
be limited by their still-high dependence on central government
grants, which subject local budgets to volatility stemming from
intergovernmental relations, as well as by the still relatively
centralized system, with low predictability on the outcome of
reforms.

S&P continues to assess Plovdiv's SACP at 'bbb-'.  An SACP
assessment is not a rating but a means of evaluating the
intrinsic creditworthiness of an LRG under the assumption that
there is no sovereign rating cap.  The SACP level results from
the combination of our assessment of an LRG's individual credit
profile and the institutional framework in which it operates.

The SACP benefits from Plovdiv's low but increasing tax-supported
debt burden and low contingent liabilities.  S&P also takes into
account the city's average budgetary performance and flexibility,
as well as its adequate liquidity position.  The rating is
somewhat constrained by the still evolving institutional
framework for municipalities in Bulgaria, and by the city's weak
financial management and economy by international standards.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee agreed that all key rating factors were unchanged.

The chair ensured every voting member was given the opportunity
to articulate his/her opinion.  The chair or designee reviewed
the draft report to ensure consistency with the Committee
decision. The views and the decision of the rating committee are
summarized in the above rationale and outlook.  The weighting of
all rating factors is described in the methodology used in this
rating action.

RATINGS LIST

                                     Rating
                                     To           From
Plovdiv (City of)
Issuer Credit Rating
  Foreign and Local Currency         BB+/Pos./--  BB+/Stable/--
Senior Unsecured
  Foreign Currency                   BB+          BB+


SOFIA CITY: S&P Affirms 'BB+' ICR & Revises Outlook to Positive
---------------------------------------------------------------
S&P Global Ratings revised its outlook on Bulgarian city of Sofia
to positive from stable.  At the same time, S&P affirmed its
'BB+' long-term issuer credit rating on the city.

As a "sovereign rating" (as defined in EU CRA Regulation
1060/2009 "EU CRA Regulation"), the ratings on city of Sofia are
subject to certain publication restrictions set out in Art 8a of
the EU CRA Regulation, including publication in accordance with a
pre-established calendar.  Under the EU CRA Regulation,
deviations from the announced calendar are allowed only in
limited circumstances and must be accompanied by a detailed
explanation of the reasons for the deviation.  In this case, the
reason for the deviation is the revision of the outlook on
Bulgaria to positive from stable on June 2, 2017.  The next
scheduled rating publication on the city of Sofia will be on
Sept. 1, 2017.

                               OUTLOOK

The positive outlook on Sofia reflects that on Bulgaria
(BB+/Positive/B).

Upside Scenario

Any rating action S&P takes on the sovereign in the next 12
months would likely be followed by a similar action on Sofia.

Downside Scenario

S&P would revise the outlook to stable in case of a similar
action on Bulgaria.

S&P views an intrinsic downside scenario as highly unlikely
because its assessment of Sofia's stand-alone credit profile
(SACP) is two notches higher than S&P's credit rating on Sofia.

                              RATIONALE

The rating action on Sofia follows S&P's recent revision of the
outlook on Bulgaria to positive from stable.

The long-term ratings on Sofia primarily reflect S&P's 'BB+'
long-term sovereign credit ratings on Bulgaria.  S&P do not
consider that the city meets the conditions under which S&P would
rate a local or regional government higher than the related
sovereign.  S&P consequently caps the long-term rating on Sofia
at the level of S&P's long-term rating on Bulgaria.  In S&P's
opinion, Bulgarian cities, including Sofia, are not able to
maintain more resilient credit characteristics than the sovereign
in a stress scenario.  In particular, S&P views their autonomy to
be limited by the still-high dependence on central government
grants, which subjects local budgets to volatility stemming from
intergovernmental relations, as well as by the still relatively
centralized government system, with low predictability on reform
outcome.

S&P assesses Sofia's SACP at 'bbb'.  The SACP is not a rating but
a means of assessing the intrinsic creditworthiness of a local or
regional government under the assumption that there is no
sovereign rating cap.

The SACP on Sofia reflects S&P's view of the city's robust
liquidity and budgetary flexibility, based on its significant
autonomy in managing local revenues.  This flexibility is
somewhat constrained, however, by the city government's
reluctance to raise taxes and fees.  Sofia's economic wealth is
average compared with international peers', in S&P's view.  The
SACP is constrained by Sofia's still developing institutional
framework.  Combined with weak, albeit strengthening, financial
management, this limits the predictability of the city's
financial performance.  Thanks to a large capital investment
program, S&P believes that the city's budgetary performance will
remain average, but that debt and contingent liabilities will
remain high.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee agreed that all key rating factors were unchanged.

The chair ensured every voting member was given the opportunity
to articulate his/her opinion.  The chair or designee reviewed
the draft report to ensure consistency with the Committee
decision. The views and the decision of the rating committee are
summarized in the above rationale and outlook.  The weighting of
all rating factors is described in the methodology used in this
rating action.

RATINGS LIST

                                     Rating
                                     To            From
Sofia (City of)
Issuer Credit Rating
  Foreign and Local Currency         BB+/Pos./--   BB+/Stable/--


STARA ZAGORA: S&P Revises Outlook to Positive & Affirms 'BB+' ICR
-----------------------------------------------------------------
S&P Global Ratings revised its outlook on the Bulgarian City of
Stara Zagora to positive from stable.  At the same time, S&P
affirmed its 'BB+' long-term issuer credit rating.

As a "sovereign rating" (as defined in EU CRA Regulation
1060/2009 "EU CRA Regulation"), the ratings on the City of Stara
Zagora are subject to certain publication restrictions set out in
Art 8a of the EU CRA Regulation, including publication in
accordance with a pre-established calendar.  Under the EU CRA
Regulation, deviations from the announced calendar are allowed
only in limited circumstances and must be accompanied by a
detailed explanation of the reasons for the deviation.  In this
case, the reason for the deviation has been caused by the
revision of the outlook on the Republic of Bulgaria to positive
from stable on June 2, 2017.  The next scheduled rating
publication on the rating on the City of Stara Zagora will be on
Sept. 15, 2017.

                              OUTLOOK

The positive outlook reflects that on Bulgaria.

Upside Scenario

Any rating action S&P takes on the sovereign in the next 12
months would likely be followed by a similar action on Stara
Zagora.

Downside Scenario

S&P would revise the outlook to stable in case of a similar
action on Bulgaria.

S&P views a downside scenario based on our assessment of Stara
Zagora's stand-alone credit profile (SACP) as unlikely, since the
SACP is higher than the long-term rating on the city.  S&P could
revise down the SACP if Stara Zagora materially missed its
financial targets and reported persistently high deficits after
capital accounts, leading to increased debt and pressure on
liquidity.

                             RATIONALE

The rating action on Stara Zagora follows S&P's recent outlook
revision on Bulgaria.

The long-term rating on Stara Zagora primarily reflects S&P's
'BB+' long-term sovereign credit rating on Bulgaria.  S&P do not
consider that the city meets the conditions under which S&P would
rate a local or regional government (LRG) higher than the related
sovereign.  S&P consequently caps the long-term rating on Stara
Zagora at the level of S&P's long-term rating on Bulgaria.  In
S&P's opinion, Bulgarian cities, including Stara Zagora, are not
able to maintain more resilient credit characteristics than the
sovereign in a stress scenario.  In particular, S&P views their
autonomy to be limited by the still-high dependency on central
government grants, which subjects local budgets to volatility
stemming from intergovernmental relations, as well as by the
still relatively centralized system, with low predictability on
the outcome of reforms.

S&P continues to believe that Stara Zagora's SACP, which S&P
assess at 'bbb-', remains burdened by possible volatility in
financial indicators due to the city's small size.  An SACP
assessment is not a rating but a means of evaluating the
intrinsic creditworthiness of an LRG under the assumption that
there is no sovereign rating cap.  The SACP level results from
the combination of S&P's assessment of an LRG's individual credit
profile and the institutional framework in which it operates.

Stara Zagora's SACP is supported by its very low debt burden and
low contingent liabilities.  Furthermore, in S&P's view, the city
has average budgetary flexibility, reflecting its high autonomy
to set taxes, although this is offset by constrained expenditure
flexibility.  In addition, Stara Zagora reports strong budgetary
performance and, in turn, enjoys adequate liquidity, in S&P's
view.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.

The committee agreed that all key rating factors were unchanged.

The chair ensured every voting member was given the opportunity
to articulate his/her opinion.  The chair or designee reviewed
the draft report to ensure consistency with the Committee
decision. The views and the decision of the rating committee are
summarized in the above rationale and outlook.  The weighting of
all rating factors is described in the methodology used in this
rating action.

RATINGS LIST

                                 Rating
                                 To               From
Stara Zagora (City of)
Issuer Credit Rating
  Foreign and Local Currency     BB+/Pos./--      BB+/Stable/--



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F R A N C E
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NOVARTEX SAS: S&P Lowers CCR to 'SD' on Announced Exchange Offer
----------------------------------------------------------------
S&P Global Ratings lowered its long-term corporate credit rating
on Novartex S.A.S., the parent company of France-based mass-
market apparel and footwear retailer Vivarte Group, to 'SD'
(selective default) from 'CC'.

At the same time, S&P lowered its issue rating on the EUR500
million super senior bonds issued by Novartex's subsidiary
Vivarte to 'D' (default) from 'CC'.  The recovery rating on these
notes remains '4', reflecting S&P's expectation of average
recovery (30%-50%; rounded estimate 30%) for creditors in the
event of a default.

S&P also lowered its issue rating on the EUR780 million senior
reinstated debt issued by Novartex's subsidiary, Novarte, to 'D'
from 'C'.  The recovery rating on these notes is '6', reflecting
S&P's expectation of negligible recovery (0%-10%; rounded
estimate 0%) for creditors in the event of a default.  Once the
transaction is completed, S&P will withdraw the rating.

The downgrade follows the close of Vivarte's restructuring
whereby the group is converting into equity EUR780 million of
reinstated debt alongside convertible bonds worth EUR800 million,
and extending the maturity of its EUR500 million super senior
bonds by two years, with unchanged interest rate assumptions.

S&P considers such a debt restructuring to be tantamount to a
default, for both the reinstated debt and the super senior bonds,
because, for both instruments, lenders are to receive less than
originally promised.

Vivarte operates in the challenging mass market apparel and
footwear segment in France.  Its operating performance is weak,
and S&P expects it will remain this way for the next couple of
years, since S&P anticipates that the group's current
restructuring of its operating model will create additional
one-off costs that will weigh on free cash flow generation.

S&P intends to raise the corporate credit rating once it has
reevaluated the company's creditworthiness following the
implementation of the new capital structure.  S&P's analysis will
incorporate its view of the company's liquidity and high leverage
following its restructuring initiatives, as well as the
challenging operating environment.



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


AUCTIONATA: German Startups Buys Livestream Auction Technology
--------------------------------------------------------------
Thomas Ohr at EU-Startups reports that German Startups Group, one
of Germany's most active private venture capital investors, has
acquired the entire software technology for online livestream
auctions from the liquidator of the insolvency estate of
Auctionata Paddle8 AG.

Auctionata was a formerly very successful, internationally active
Berlin-based startup with over 300 employees, which had to file
for bankruptcy in the beginning of 2017, EU-Startups discloses.
Auctionata invested a double-digit million amount in the
development of its unique, patented software technology in the
time period from 2012 through 2016, EU-Startups relates.

German Startups Group (GSG) was able to purchase the entire
technology for only about EUR80,000, EU-Startups relays, citing
well-informed sources.

EU-Startups also heard rumors that GSG is in advanced
negotiations with the core development team of Auctionata about
the joint creation of a new company.  The goal of the new
business would be to provide third-parties with the livestream
technology as a sort of "livestream as a service", EU-Startups
states.

Since the domain Auctionata.com was already sold to a Berlin-
based auction house called Historia, the new company would
definitely also need a new name, according to EU-Startups.

Christoph Gerlinger, CEO of German Startups Group, didn't comment
on the purchase price or the rumors about concrete future plans
regarding the technology, EU-Startups notes.

Instead, Mr. Gerlinger, as cited by EU-Startups, said: "Auctions
are a core pricing mechanism within the market economy and
applied in countless areas.  They will increasingly take place
online since, across national borders, a much higher number of
bidders can be reached.  This is why we strongly believe in the
value of a leading software technology for livestream auctions.
It provides a basis for the digitalization of the auction
business.  With its help, online auctions in all branches are
possible -- ranging from art, antiquities, jewelry, watches,
vintage cars, and wines to estates, inventories, special items,
real estate, and securities."


UNITYMEDIA GMBH: Hessen Transaction No Impact on Moody's B1 CFR
---------------------------------------------------------------
Moody's Investors Service has assigned a Ba3 rating to the
proposed USD620 million new Term Loan (due 2025) being issued by
Unitymedia Finance LLC. Unitymedia Finance LLC is a new entity
that will be incorporated in Delaware and will become a 100%
owned subsidiary of Unitymedia Hessen GmbH & Co. KG, the issuer
of the existing Ba3 rated senior secured debt for the Unitymedia
group.

The B1 corporate family rating (CFR) and B1-PD probability of
default rating (PDR) at Unitymedia GmbH ('UM'; the top-most
entity of the ring-fenced group) as well as all the existing debt
ratings within the group remain unaffected by this transaction.
The outlook on all ratings is stable.

The proceeds from the new Term Loan will be used to refinance the
existing EUR527 million senior secured notes (due 2022) issued by
Unitymedia Hessen GmbH & Co. KG, including related premiums and
expenses. The refinancing transaction is leverage neutral and
will improve the group's debt maturity profile.

The Ba3 rating on the new Term Loan reflects the fact that it
benefits from the same security and guarantees package as the
existing rated senior secured debt at Unitymedia Hessen (also
rated Ba3).

RATINGS RATIONALE

The Ba3 rating on the new Term Loan and the existing senior
secured debt is one notch higher than the group's B1 CFR
reflecting the cushion provided by the structurally subordinated
senior notes (rated B3) at UM.

UM's B1 CFR takes into account (1) its solid operating
performance, evidenced by strong revenue and EBITDA growth; (2)
Moody's expectation that the company's strategic focus on
integrated bundle offerings, transitioning of customers from
analogue to digital TV, network expansion and regular price
increases should yield continued growth in revenue generating
units ("RGU") and Average Revenue Per User ("ARPU"); (3) the
competitive advantages from the company's high capacity network;
and (4) the benefits for UM of operating in some of the more
affluent areas of Germany Europe's largest cable market.

The rating also factors in (1) the company's significant leverage
(UM's Debt/EBITDA ratio - as calculated by Moody's stands at
around 5.9x for the last twelve months ("LTM") ending March 31,
2017); (2) its high capex requirements (PPE additions of 28% of
revenues for the first three months to March 31, 2017); (3) the
strong competition in the multi-dwelling units ("MDU") business,
in particular for larger housing association contracts; (4) the
absorption of the company's free cash flow ("FCF") by parent
company distributions; and (5) continued net video subscriber
losses, albeit at a moderate rate.

RATING OUTLOOK

The stable outlook is based on Moody's expectations that UM will
continue to maintain visible revenue and EBITDA growth.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward ratings pressure could develop if (1) the company's
operating performance remains solid; (2) Moody's adjusted Gross
Debt/ EBITDA ratio improves towards 5.25x (as calculated by
Moody's); and (3) Moody's adjusted cash flow from operations
("CFO")/ Debt ratio is sustained above 14%.

Downward ratings pressure could ensue if: (1) the company
experiences a marked deterioration in operating performance; (2)
leverage rises above 6.0x Gross Debt/ EBITDA (as adjusted by
Moody's); and (3) Moody's adjusted CFO/ Debt falls below 8% for a
sustained period of time.

LIST OF AFFECTED RATINGS

Assignments:

Issuer: Unitymedia Finance LLC

-- Backed Senior Secured Bank Credit Facility, Assigned Ba3

Outlook Actions:

Issuer: Unitymedia Finance LLC

-- Outlook, Assigned Stable

PRINCIPAL METHODOLOGY

The principal methodology used in this rating was Global Pay
Television - Cable and Direct-to-Home Satellite Operators
published in January 2017.

UM, an indirectly wholly-owned subsidiary of Liberty Global plc
("Liberty Global", rated Ba3/Stable), is the second largest cable
operator (provider of basic and enhanced video, Internet and
telephony services) in Germany by number of customers. For the
year ended December 31, 2016, the company generated EUR2.28
billion in revenues and EUR1.44 billion in EBITDA as adjusted by
the company.



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I R E L A N D
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ALLIED IRISH: Moody's Ups Pref. Stock Non-cumulative Rating to B1
-----------------------------------------------------------------
Moody's Investors Service has upgraded the long-term debt and
deposit ratings of two Irish banks - Bank of Ireland (BOI) and
Allied Irish Banks, p.l.c. (AIB). As part of the same action,
Moody's upgraded the baseline credit assessments (BCAs) of AIB
and BOI.

The rating upgrades reflect a range of positive factors,
including further reduction in non-performing loans, improved
capital ratios and achievement of stable core profitability" said
Irakli Pipia, Vice President-Senior Credit Officer. "However,
AIB's higher stock of problem loans, continues to justify a
difference in the base line credit assessment of AIB relative to
BOI".

Moody's maintained a positive outlook on BOI's long-term senior
unsecured debt and deposit ratings. The agency revised the
outlook on AIB's long-term senior unsecured debt and deposit
ratings to stable from positive.

RATINGS RATIONALE

Bank Of Ireland

BCA

The upgrade of BOI's long-term debt and deposit ratings was
driven by the revision of the bank's BCA to baa3 from ba1.

The upgrade of BOI's BCA reflects the following trends: (1)
further improvements in asset quality, as shown by the bank's
problem loan ratio, which fell to 7.9% as at end-2016 from 11% a
year earlier; (2) improving trend in capital ratios despite non-
operational factors, (e.g. negative impact of the defined benefit
plan deficit volatility), with Tangible Common Equity (TCE) as
percentage of Risk Weighted Assets (RWAs) at 13.4% as at end-
2016, up from 13.2% a year earlier; (3) stable core profitability
and net interest margin, with reduced reliance on one-off items;
and (4) a good funding profile, reflected in an improved loan-to-
deposit ratio of 108% as at end-2016 down, from 112% a year
earlier.

At the same time, the current BCA takes into account the
remaining sizeable stock of non-performing loans in addition to a
significant stock of forborne loans with an expectation of a
slower rate of amortization going forward. The bank's problem
loans as a percentage of its capital and loan loss reserves at
60% as at end-2016 still compares unfavorably to similarly rated
peers. Overall, these factors expose the bank to asset quality
challenges if the current benign operating environment in Ireland
were to weaken unexpectedly.

LONG-TERM RATINGS

The long-term senior unsecured debt and deposit ratings were
upgraded to Baa1 and A3, respectively from Baa2 and Baa1,
reflecting the upgrade of the bank's BCA as well as the uplift
resulting from Moody's Advanced Loss Given Failure (LGF)
analysis. The senior unsecured debt rating benefits from one
notch of uplift and bank deposit rating benefits from two notches
of uplift from Moody's Advanced LGF analysis. In addition, the
long-term ratings incorporate one notch of government support,
which remains unchanged. The bank's short-term ratings were
affirmed at Prime-2.

The long-term senior unsecured debt and deposit ratings were
upgraded to Baa1 and A3, respectively from Baa2 and Baa1, as a
result of the upgrade of the bank's BCA, with uplift resulting
from Moody's Advanced Loss Given Failure (LGF) analysis remaining
unchanged. The senior unsecured debt rating and bank deposit
rating benefit from one notch and two notches of uplift
respectively, given their different positioning in the bank's
liability structure and, consequently, different amount of
subordination supporting loss-rates. The bank's senior unsecured
debt is likely to face loss-given-failure supported by the loss
absorption provided by its own volume and the amount of junior
debt subordinated to it. The bank's deposits are likely to face
lower loss-given-failure, as expressed in the two notches of
uplift, due to the loss absorption provided by subordinated debt
and, potentially, by a sizeable amount of senior unsecured debt
should deposits be treated preferentially in a resolution. In
addition, the long-term ratings incorporate one notch of
government support, which also remains unchanged.

The positive outlooks on BOI's long-term deposits and senior
unsecured debt ratings reflect Moody's expectation of debt to be
issued by a new holding company over the outlook period which if
carried out as planned, will increase the level of protection for
both bank's deposits and its own senior debt.

CR Assessment (CRA)

The bank's CRA was affirmed at A3(cr)/Prime-2(cr). The CRA
incorporates three notches of uplift from the bank's BCA given
the protection provided by subordinated debt, senior debt and
wholesale deposits, bringing it the same level Moody's rating on
the Government of Ireland. Given this, a moderate probability of
government support for the bank's operating obligations does not
give rise to any further uplift and the long-term and short-term
CRAs remain A3(cr) and Prime-2(cr) respectively.

WHAT COULD MOVE THE RATINGS UP/DOWN

BOI's long-term debt and deposit ratings could be upgraded as a
result of (1) an upgrade in its standalone BCA; or (2) a
significant increase in the bank's bail-in-able debt. The bank's
BCA could be upgraded following (1) further significant
reductions in non-performing loans and/or improving provisioning
coverage; (2) improving capitalisation and risk absorption
capacity, while maintaining (3) stable profitability, funding and
liquidity metrics.

BOI's ratings could be downgraded as a result of (1) a downgrade
of its standalone BCA; or (2) the redemption of maturing
subordinated instruments without their replacement. BOI's BCA
could be downgraded due to (1) a significant deterioration in the
bank's asset quality; (2) a significant and sustained drop in the
bank's capitalisation; (3) a deterioration in its core
profitability metrics; or (4) a significant increase in the use
of confidence-sensitive wholesale funding or a material reduction
in liquid assets.

RATINGS RATIONALE -- AIB

BCA

The upgrade of AIB's long-term debt and deposit ratings was
driven by the revision of the bank's BCA to ba1 from ba2.

The upgrade of AIB's BCA to ba1 reflects the following trends:
(1) on-going improvement in asset quality reflected in the
reduction of the percentage of problem loans to total loans at
14% as at end-2016 from 18.6% a year earlier; (2) improvement in
capital levels, with a relatively high tangible common equity
(TCE) over risk-weighted assets (RWA) ratio of 15.6% as at end-
2016, up from 14.5% a year earlier; (3) stabilising its core
profitability with improved earnings quality and increasing net
interest margin; and (4) a funding profile exhibiting lower
reliance on market funds than in previous periods and a
comfortable liquidity position.

At the same time, the BCA takes into account AIB's higher non-
performing asset ratio and lower provisioning coverage when
compared with similarly-rated peers. The BCA also incorporates
the bank's higher problem loans as a percentage of its capital
and loan loss reserves, at 69% as at end-2016. In Moody's view
these features constrain further upside potential of the bank's
BCA over the outlook horizon.

LONG-TERM RATINGS

The upgrade of AIB's long-term senior unsecured debt and deposit
ratings to Baa2 and Baa1 from Baa3 and Baa2, respectively,
reflect the upgrade of the bank's BCA and include uplift
resulting from Moody's LGF analysis. The senior unsecured debt
and deposit ratings continue to benefit from one notch and two
notches of uplift respectively under the LGF analysis, given
their different weights in the bank's liability structure. In
addition, the long-term ratings incorporate one notch of
government support, which also remains unchanged. The bank's
short-term ratings were affirmed at Prime-2.

The stable outlooks on AIB's long-term deposit and senior
unsecured debt ratings reflect the limited upside for the bank's
standalone BCA during the outlook period given its relatively
high stock of non-performing loans and modest provisioning
coverage compared to its peers. While Moody's expects the group
to issue debt from a planned holding company, which would provide
additional protection for the bank's senior unsecured debt and
deposits, the rating agency does not believe that this will be
sufficient to lead to higher ratings over the outlook horizon.

CR Assessment (CRA)

The bank's long-term CRA was upgraded to A3(cr) from Baa1(cr),
one notch above the bank's PRA and at the same level as Ireland's
sovereign rating of A3. Short-term CRA was affirmed at Prime-
2(cr). The CRA includes three notches of uplift under the LGF
analysis, given significant volume of subordinated debt, senior
debt and wholesale deposits, and one notch of government support.

WHAT COULD MOVE THE RATINGS UP/DOWN

AIB's long-term debt and deposit ratings could be upgraded as a
result of (1) an upgrade in its standalone BCA; or (2) a
significant increase in the bank's bail-in-able debt. The bank's
BCA could be upgraded because of (1) a further material reduction
in non-performing loans; (2) an improvement in stressed-capital
resilience above Moody's expectations; or (3) a sustained
improvement in core profitability.

AIB's ratings could be downgraded as a result of (1) a downgrade
of its standalone BCA; or (2) redemption of maturing subordinated
instruments without their replacement. AIB's BCA could be
downgraded because of (1) a significant deterioration in the
bank's asset risk metrics; (2) a weakening of its solvency
profile; or (3) a worsening of its core profitability ratios.

LIST OF AFFECTED RATINGS

Issuer: Allied Irish Banks, p.l.c.

Upgrades:

-- LT Bank Deposits (Local & Foreign Currency), Upgraded to Baa1
    from Baa2, Outlook Changed To Stable From Positive

-- Senior Unsecured Regular Bond/Debenture, Upgraded to Baa2
    from Baa3, Outlook Changed To Stable From Positive

-- Subordinate, Upgraded to Ba2 from Ba3

-- Pref. Stock Non-cumulative, Upgraded to B1(hyb) from B2(hyb)

-- Senior Unsecured MTN Program, Upgraded to (P)Baa2 from
   (P)Baa3

-- Subordinate MTN Program, Upgraded to (P)Ba2 from (P)Ba3

-- Junior Subordinate MTN Program, Upgraded to (P)Ba3 from (P)B1

-- Other Short Term, Upgraded to (P)P-2 from (P)P-3

-- Adjusted Baseline Credit Assessment, Upgraded to ba1 from ba2

-- Baseline Credit Assessment, Upgraded to ba1 from ba2

-- LT Counterparty Risk Assessment, Upgraded to A3(cr) from
    Baa1(cr)

Affirmations:

-- ST Bank Deposits (Local & Foreign Currency), Affirmed P-2

-- ST Counterparty Risk Assessment, Affirmed P-2(cr)

Issuer: Bank of Ireland

Upgrades:

-- LT Issuer Rating (Local Currency), Upgraded to Baa1 from
    Baa2, Outlook Remains Positive

-- LT Bank Deposits (Local & Foreign Currency), Upgraded to A3
    from Baa1, Outlook Remains Positive

-- Senior Unsecured Regular Bond/Debenture, Upgraded to Baa1
    from Baa2, Outlook Remains Positive

-- Subordinate, Upgraded to Ba1 from Ba2

-- Junior Subordinate, Upgraded to Ba2(hyb) from Ba3(hyb)

-- Pref. Stock, Upgraded to Ba3(hyb) from B1(hyb)

-- Pref. Stock Non-cumulative, Upgraded to Ba3(hyb) from B1(hyb)

-- Senior Unsecured MTN Program, Upgraded to (P)Baa1 from
   (P)Baa2

-- Subordinate MTN Program, Upgraded to (P)Ba1 from (P)Ba2

-- Adjusted Baseline Credit Assessment, Upgraded to baa3 from
    ba1

-- Baseline Credit Assessment, Upgraded to baa3 from ba1

Affirmations:

-- ST Bank Deposits (Local & Foreign Currency), Affirmed P-2

-- Commercial Paper, Affirmed P-2

-- ST Deposit Note/CD Program, Affirmed P-2

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

-- LT Counterparty Risk Assessment, Affirmed A3(cr)

-- ST Counterparty Risk Assessment, Affirmed P-2(cr)

Issuer: Bank of Ireland UK Holdings Plc

Upgrade:

-- BACKED Pref. Stock, Upgraded to Ba2(hyb) from Ba3(hyb)

Issuer: Bristol & West plc

Upgrade:

-- Subordinate, Upgraded to Ba1 from Ba2

Issuer: EBS d.a.c.

Upgrades:

-- LT Bank Deposits (Local & Foreign Currency), Upgraded to Baa1
    from Baa2, Outlook Changed To Stable From Positive

-- Adjusted Baseline Credit Assessment, Upgraded to ba1 from ba2

-- Baseline Credit Assessment, Upgraded to ba1 from ba2

-- LT Counterparty Risk Assessment, Upgraded to A3(cr) from
    Baa1(cr)

Issuer: EBS d.a.c.

Affirmations:

-- ST Bank Deposits (Local & Foreign Currency), Affirmed P-2

-- ST Counterparty Risk Assessment, Affirmed P-2(cr)

Outlook Actions:

Issuer: Allied Irish Banks, p.l.c.

-- Outlook, Changed To Stable From Positive

Issuer: Bank of Ireland

-- Outlook, Remains Positive

Issuer: EBS d.a.c.

-- Outlook, Changed To Stable From Positive

PRINCIPAL METHODOLOGY

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


HALCYON LOAN 2017-1: Moody's Assigns (P)B2 Rating to Cl. F Notes
----------------------------------------------------------------
Moody's Investors Service assigned the following provisional
ratings to notes to be issued by Halcyon Loan Advisors European
Funding 2017-1 Designated Activity Company:

-- EUR190,000,000 Class A Senior Secured Floating Rate Notes
    due 2030, Assigned (P)Aaa (sf)

-- EUR34,000,000 Class B-1 Senior Secured Floating Rate Notes
    due 2030, Assigned (P)Aa2 (sf)

-- EUR10,000,000 Class B-2 Senior Secured Fixed Rate Notes due
    2030, Assigned (P)Aa2 (sf)

-- EUR22,500,000 Class C Senior Secured Deferrable Floating
    Rate Notes due 2030, Assigned (P)A2 (sf)

-- EUR16,500,000 Class D Senior Secured Deferrable Floating
    Rate Notes due 2030, Assigned (P)Baa2 (sf)

-- EUR18,200,000 Class E Senior Secured Deferrable Floating
    Rate Notes due 2030, Assigned (P)Ba2 (sf)

-- EUR9,500,000 Class F Senior Secured Deferrable Floating Rate
    Notes due 2030, Assigned (P)B2 (sf)

Moody's issues provisional ratings in advance of the final sale
of financial instruments, but these ratings only represent
Moody's preliminary credit opinions. Upon a conclusive review of
a transaction and associated documentation, Moody's will
endeavour to assign definitive ratings. A definitive rating (if
any) may differ from a provisional rating.

RATINGS RATIONALE

Moody's provisional rating of the rated notes addresses the
expected loss posed to noteholders by legal final maturity of the
notes in 2030. The provisional 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, Halcyon Loan
Advisors (UK) LLP ("Halcyon"), has sufficient experience and
operational capacity and is capable of managing this CLO.

Halcyon Loan Advisors European Funding 2017-1 Designated Activity
Company is a managed cash flow CLO. At least 90% of the portfolio
must consist of senior secured obligations and up to 10% of the
portfolio may consist of senior unsecured obligations, second-
lien loans, mezzanine obligations and high yield bonds. The
portfolio is expected to be 60% ramped up as of the closing date
and to be comprised predominantly of corporate loans to obligors
domiciled in Western Europe. The remainder of the portfolio will
be acquired during the six month ramp-up period in compliance
with the portfolio guidelines.

Halcyon 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 obligations or credit improved obligations, and are subject
to certain restrictions.

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR 37,200,000 of subordinated notes, which
will not be 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. Halcyon's investment decisions
and management of the transaction will also affect the notes'
performance.

Loss and Cash Flow Analysis:

Moody's modeled the transaction using CDOEdge, a cash flow model
based on the Binomial Expansion Technique, as described in
Section 2.3 of the "Moody's Global Approach to Rating
Collateralized Loan Obligations" rating methodology published in
October 2016. The cash flow model evaluates all default scenarios
that are then weighted considering the probabilities of the
binomial distribution assumed for the portfolio default rate. In
each default scenario, the corresponding loss for each class of
notes is calculated given the incoming cash flows from the assets
and the outgoing payments to third parties and noteholders.

Therefore, the expected loss or EL for each tranche is the sum
product of (i) the probability of occurrence of each default
scenario and (ii) the loss derived from the cash flow model in
each default scenario for each tranche.

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

Par Amount: EUR 325,000,000

Diversity Score: 40

Weighted Average Rating Factor (WARF): 2775

Weighted Average Spread (WAS): 3.70%

Weighted Average Coupon (WAC): 4.75%

Weighted Average Recovery Rate (WARR): 43.5%

Weighted Average Life (WAL): 8 years

As part of the base case, Moody's has addressed the potential
exposure to obligors domiciled in countries with local currency
country risk ceiling (LCC) of A1 or below. As per the portfolio
constraints, exposures to countries with local currency country
risk ceiling rating of A1 or below cannot exceed 10%, with
exposures to countries local currency country risk ceiling rating
of Baa1 to Baa3 further limited to 5%. Following the effective
date, and given these portfolio constraints and the current
sovereign ratings of eligible countries, the total exposure to
countries with a LCC of A1 or below may not exceed 10% of the
total portfolio. As a worst case scenario, a maximum 5% of the
pool would be domiciled in countries with LCC of A3 and 5% in
countries with LCC of Baa3. The remainder of the pool will be
domiciled in countries which currently have a LCC of Aa3 and
above. Given this portfolio composition, the model was run with
different target par amounts depending on the target rating of
each class of notes as further described in the methodology. The
portfolio haircuts are a function of the exposure size to
countries with a LCC of A1 or below and the target ratings of the
rated notes and amount to 0.75% for the Class A notes, 0.50% for
the Class B notes, 0.375% for the Class C notes and 0% for
Classes D, E and F.

Stress Scenarios:

Together with the set of modelling assumptions above, Moody's
conducted an additional sensitivity analysis, which was an
important component in determining the provisional 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 3191 from 2775)

Ratings Impact in Rating Notches:

Class A Senior Secured Floating Rate Notes: 0

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

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

Class C Senior Secured Deferrable Floating Rate Notes: -2

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: 0

Percentage Change in WARF: WARF +30% (to 3608 from 2775)

Ratings Impact in Rating Notches:

Class A Senior Secured Floating Rate Notes: 0

Class B-1 Senior Secured Floating Rate Notes: -3

Class B-2 Senior Secured Fixed Rate Notes: -3

Class C Senior Secured Deferrable Floating Rate Notes: -4

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: -2

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.



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


ALBAZZURRA HOTEL: July 19 Bid Submission Deadline Set
-----------------------------------------------------
The Court-appointed Liquidator of Arrangement with Creditors no.
8/2012 of Albazzurra Hotel & Resort s.r.l. proposes the sale,
through a competitive bidding process, of the hotel complex
composed of the Capo dei Greci and Magna Grecia units located in
Sant'Alessio Siculo, Via Nazionale 421, Contrada Santa Margherita
(Me), Riviera di Taormina, as well as the related fittings.

Starting price for the joint sale of the two units:
EUR46,575,821.00 in addition to tax.

Starting price for the Capo dei Greci unit:
EUR24,144,905.00 in addition to tax.

Starting price for the Magna Grecia unit:
EUR22,430,915.00 in addition to tax.

Applications must be sent electronically and digitally signed via
certified e-mail to: albazzurrahotel@pec.it ,
cp8.2012messina@pecfallimenti.it , according to the format
published on the website www.albazzurrarealestate.it, allowing
access to the virtual data room (containing the full sale rules,
the formats for requesting access to the data room, the
irrevocable purchase bid with bid deposit, the appraisals and
other documents relevant to the sale).  Where no request is made
to access the virtual data room, bidders may, nonetheless, submit
by 8:00 p.m. on July 19, 2017, an irrevocable purchase bid with
bid deposit (the "Binding Purchase Bid"), valid until the
deadline set for the final awarding, according to the format
published on www.albazzurrarealestate.it, which must be sent
digitally signed via certified e-mail to albazzurrahotel@ pec.it
, cp8.2012messina@pecfallimenti.it ,
paola.totaro@postacertificata.notariato.it , and must also file
their bid on paper by the same deadline -- 8:00 PM on July 19,
2017 -- with the office of Notary Paola Totaro in Via Romagnosi
7, Messina, accompanied by a crossed bank draft in the name of
"C.P. Albazzura Hotel & Resort s.r.l. n. 8/2012 Tribunale di
Messina" amounting to EUR2,500,000.00 or to EUR1,250,000.00 if
the bid regards a single unit.

On July 24, 2017, beginning from 9:00 a.m., before said Notary at
her office in Via Romagnosi 7, Messina, the competitive bidding
process will take place, with a starting price corresponding to
the highest purchase bid, and with a minimum bid increment equal
to 5% of the starting price.

The Liquidator will assess any expressions of interest in the
purchase that are non-binding for the Procedure, submitted in the
above time limits, including at a price lower than the
established sale price.

The notice does not constitute an irrevocable offer, public
offering or solicitation of public savings, nor does it in any
way commit the Court-appointed Liquidator to contract with the
bidders.

The Bankruptcy Judge is Giuseppe Minutoli of the Court of Messina
Bankruptcy Division.

The Court-appointed Receiver is Angelo Vitarelli.

The Court-appointed Liquidator is Giuseppe Biondi.


ILVA SPA: Business to be Acquired by Arcelormittal for EUR1.8BB
---------------------------------------------------------------
Michael Pooler at The Financial Times reports that a group led by
ArcelorMittal has won the race to buy Ilva, the Italian owner of
Europe's biggest steel plant that was nationalized after an
alleged environmental disaster.

Carlo Calenda, Italy's economic development minister, signed a
decree on June 5 approving the EUR1.8 billion offer, led by the
world's largest steelmaker, in a move that will deliver the
century-old industrial concern back into private ownership, the
FT relates.

Ilva includes the Taranto steelworks in southern Italy, the
continent's largest by output capacity, which was accused of
toxic emissions linked to high cancer rates in the area, as well
as another plant in Genoa among other facilities, the FT
discloses.

According to the FT, the sale by the Italian government is aimed
at ending a saga that has dragged on for years in which the debt-
laden business fell into insolvency, putting 14,000 jobs in
jeopardy.

The successful bid for Ilva by the AM Investco consortium, which
also includes Marcegaglia, the Italian steel processor, and Banca
Intesa Sanpaolo, saw off a rival offer from a grouping led by
JSW, Sajjan Jindal's Indian steel group, the FT states.

Negotiations will now begin between the winning consortium and
officials with a view to fine-tuning some aspects of the deal,
the FT says.

As part of the tender process, officials examined the prospective
buyers' environmental clean-up plans as well as their industrial
blueprints for the business, the FT relays.

The winning party has pledged to make investments of EUR2.4
billion until 2023 on top of the EUR1.8 billion price tag,
according to the FT.

According to the government statement, the winning consortium was
open to talks about keeping job numbers at roughly 10,000, a
higher level than it originally had proposed as part of its plan,
the FT notes.


POPOLARE DI VICENZA: Italy Working on Recapitalization
------------------------------------------------------
Ross Larsen at Bloomberg News reports that Italy continues to
work on a recapitalization of Banca Popolare di Vicenza SpA and
Veneto Banca SpA, a Treasury official said after a newspaper
reported that authorities are considering winding down the
lenders.

The two banks are seeking approval from European regulators for a
government-backed rescue, Bloomberg discloses.

According to Bloomberg, people familiar with the matter said on
June 6 that Italy's preferred solution would be the sale of at
least EUR600 million (US$676 million) of bonds with a state
guarantee.

Corriere della Sera, citing unidentified people with knowledge of
the matter, reported on June 7 that Italian and European
officials are looking at an orderly liquidation that eases the
banks out of the market without triggering European resolution
rules that require investors to take losses, Bloomberg relays.

The Veneto-based banks, which are seeking to merge, turned to the
government after failing to find investors willing to buy stock
to plug a capital shortfall, Bloomberg recounts.

Banca Popolare di Vicenza (BPVi) is an Italian bank.  The bank
was the 13th largest retail and corporate bank of Italy by total
assets, according to Mediobanca.

                         *     *     *

As reported by the Troubled Company Reporter-Europe on Mar 21,
2017, Fitch Ratings 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).

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.


SEGUE: Official Receiver Announces July 4 Asset Sale
-----------------------------------=----------------
Andrea Frazzi, the Official Receiver of Segue, disclosed that on
July 4, 2017, at 12:00 noon, a sale through irrevocable bid will
take place before Notary Vincenzo Gunnella at his office in Via
Masaccio 187, Florence, with a tender, if the case, on the assets
described below:

Trademark "Segue . . .", a fashion accessories business
registered on a national, European and international level.

Starting price                     EUR850,000

Minimum bid increment              EUR10,000

Deposit                            EUR85,000

Starting price for remaining bids  EUR680,000

The deposit will remain unchanged in the event of the submission
of a residual bid.

This is an enforced sale, therefore, it is not subject to the
rules governing warranties for defects or lack of quality
pursuant to art. 2922 of the Italian Civil Code.

The sale will be held by the Appointed Notary by electronic means
on the Notary Auctions Network of the National Council of
Notaries (www.notario.it).

For information on the procedures for system registration,
submission of irrevocable purchase bids, participation in the
tender and awarding, transfer of the assets, and taxation applied
to the sale, one may contact the office of Official Receiver
Andrea Frazzi or visit the Website, www.astegiudiziarie.it  The
Receiver may be reached at:

     Andrea Frazzi
     Official Receiver
     Tel No.: 055-367428
     E-mail: andrea.frazzi@studioficofrazzi.it



===========
N O R W A Y
===========


NORSKE SKOG: S&P Cuts CCR to 'CC' on Debt Exchange Offer
--------------------------------------------------------
S&P Global Ratings lowered its long-term corporate credit rating
on Norwegian paper producer Norske Skogindustrier ASA (Norske
Skog) to 'CC' from 'CCC+'.  S&P affirmed its 'C' short-term
corporate credit rating on the company.

In addition, S&P lowered its issue rating on Norske Skog's senior
secured notes to 'CC' from 'CCC+'.  The recovery rating on these
notes remains unchanged at '3', reflecting S&P's expectation of
meaningful recovery (50%-70%; rounded estimate 60%) in the event
of a default.

S&P also lowered its issue ratings on Norske Skog's senior
unsecured notes to 'C' from 'CCC-'.  The recovery rating is
unchanged at '6', indicating S&P's expectation of negligible
recovery (0%-10%; rounded estimate 0%) in a default scenario.

S&P has placed all of the ratings on Norske Skog and its debt on
CreditWatch with negative implications.

The downgrade and CreditWatch placement follow Norske Skog's
launch of a debt-exchange offer that covers nearly all of the
group's capital structure, including an amendment to the terms of
the group's senior secured notes and a debt-to-equity swap for
the group's senior unsecured and previous exchange notes. In
total, about 93% of the group's capital structure is affected by
the proposed transaction, which would follow a previous debt-
exchange offer completed in 2016.

Norske Skog offers to modify the EUR290 million senior secured
notes due in 2019 by pushing the maturity to 2021 and revising
the interest rate to 8.0% from 11.8%.  While the company will pay
a premium of 102% on the secured notes, S&P considers this
extension to be a distressed exchange offer and therefore
tantamount to a default, given the reduced interest fees and low
likelihood of the instrument being refinanced ahead of the rest
of the group's unsecured debt.

In addition, Norske Skog proposes to convert all of its unsecured
bond debt (excluding about EUR15 million in finance leases and
some minor credit facilities) to equity -- which includes the
EUR114 million senior unsecured notes due 2026, $200 million due
2033, EUR159 million due 2021, $61 million prior exchange notes
due 2023, and EUR100 million hybrid perpetual notes (unrated) due
2115.  The equity value is being offered at a slight premium to
current distressed trading values, but still represents a
substantial discount to par value.

S&P believes that the noteholders will likely accept the offer,
based on the group's unrealistic prospects of refinancing the
2019 secured debt given its subsequent unsecured maturities, low
recovery prospects on the unsecured debt, and the still
substantial, albeit not immediate, default risk.

In S&P's view, Norske Skog's business prospects remain
constrained due to the still-difficult operating environment for
newsprint and magazine paper, as well as the group's high
leverage and refinancing wall.  If this transaction goes through,
however, it will substantially alleviate Norske Skog's interest
burden, allowing the group to reinvest its cash flows into growth
projects outside of publication paper.

S&P aims to resolve the CreditWatch following the completion of
the debt exchange.  If the offer is completed as planned, S&P
expects to lower the long- and short-term ratings on Norske Skog
to 'SD' (selective default), given that the group will be
conducting a distressed exchange offer.  S&P would also lower the
issue ratings on the group's senior secured and senior unsecured
notes to 'D' (default).

If Norske Skog does not complete the offer or fails to receive
the minimum consents required, S&P will assess the company's
creditworthiness primarily based on S&P's view of the likelihood
of a further distressed exchange offer.



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


BANK URALSIB: Moody's Hikes Long-Term Deposit Ratings to B3
-----------------------------------------------------------
Moody's Investors Service has upgraded the long-term local- and
foreign-currency deposit ratings of Bank Uralsib to B3 from Caa1.
The outlook on the bank's long-term deposit ratings remains
positive. Concurrently, Moody's upgraded the bank's baseline
credit assessment (BCA) and adjusted BCA to b3 from caa2.
Uralsib's Not Prime short-term local- and foreign-currency
deposit ratings were affirmed. The overall outlook on Uralsib's
long-term ratings is positive.

Moody's has also upgraded Uralsib's long-term Counterparty Risk
Assessment (CR Assessment) to B2(cr) from B3(cr) and affirmed the
bank's short-term CR Assessment of Not Prime(cr).

The rating action is primarily based on Uralsib's audited
financial statements for 2016 and unaudited financial statements
for the first quarter of 2017 prepared under International
Financial Reporting Standards (IFRS).

RATINGS RATIONALE

RATIONALE FOR RATING UPGRADE

Moody's upgrade of Uralsib's ratings reflects (1) improving
trends in the bank's profitability and capital levels; (2) its
stabilised - albeit still weak - asset quality metrics; as well
as (3) the bank's sustainable funding profile and conservative
liquidity management.

Over 2016, Uralsib returned to operational profitability, as its
recurring income, formed by net interest income and net fee-and-
commission income, started to fully cover operating expense. The
revenue generation was supported by an improved net interest
margin which widened to 4.4% in 2016 from 2.2% a year earlier.
Although in 2016 Uralsib recorded elevated loan loss provisions
of 4.4% of average gross loans, the bank was able to post
marginal bottom-line profits for 2016 translating to return on
average assets (ROAA) of 0.4%. In the first quarter of 2017,
Uralsib reported ROAA of 0.5%, compared to negative ROAA of -0.1%
in the first quarter of 2016 (both annualized, Moody's
computations). The 2016 and 1Q 2017 financial performance was
predominantly driven by recurring income streams, as distinct
from the 2015 situation when the bank reported large one-off
gains related to the bail-out package, including long-term
facilities from Russia's state Deposit Insurance Agency (DIA)
provided at lower-than-market interest rate and a write-off of
subordinated debt.

The recovery of Uralsib's internal capital generation is critical
for the bank to restore its capital adequacy levels undermined by
material write-downs on non-core assets made in 2015 upon request
of the regulator. As of the year-end 2016, Uralsib's IFRS
tangible common equity ratio equaled 14.2%, which was supported
by one-off gains derived from the bail-out package. Local GAAP
accounting standards provide for different accounting treatment,
therefore, at April 1, 2017, Uralsib's statutory consolidated
total capital adequacy ratio (CAR) and Tier 1 CAR stood at 7.0%
and 5.5%, respectively (below the regulatory minimums of 8% and
6%). As prescribed by Russia's banking law, Uralsib is granted
regulatory forbearance for some of the statutory requirements, as
it undergoes an official financial rehabilitation procedure.

Moody's also observes some stabilisation of Uralsib's asset
quality dynamics. Although the bank's problem loan ratio
increased to 29% of gross loans in 2016 from 24% in 2015, this
increase is largely due to the 13% shrinkage of the bank's loan
portfolio over the same period. Furthermore, more than one third
of problem loans are comprised by "impaired but not overdue"
loans which continue to perform. The rating agency considers the
bank's 67% coverage of problem loans (including impaired but not
overdue loans) by loan loss reserves as sufficient, being close
to the sector average. In 2017, Moody's expects Uralsib's asset
quality trends to reverse to positive as the bank currently
applies sufficiently strict underwriting standards for new
lending, which is now gaining momentum, while legacy problem
assets have all been identified.

Uralsib has a stable funding profile: at April 1, 2017, 70% of
its total liabilities came from core customer deposits, another
11% were formed by long-term funding from DIA. This funding
profile is matched by conservative liquidity management with the
bank's non-encumbered liquidity cushion exceeding 40% of total
assets as of the same reporting date.

RATIONALE FOR GOVERNMENT SUPPORT

Moody's assesses the likelihood of government support to Uralsib
as low, because the rating agency does not expect the state bail-
out package to be expanded from the levels already provided to
the bank in 2015. As such, Moody's no longer incorporates any
notches of government support uplift in Uralsib's ratings.

RATIONALE FOR POSITIVE OUTLOOK

Moody's positive outlook on Uralsib's long-term ratings derives
from the rating agency's expectation that the bank's solvency
metrics will continue to improve in the medium term, as Uralsib
gradually fills-in its balance sheet with newer, better
performing loans, while simultaneously continuing to implement
cost-cutting measures. Moody's also expects Uralsib to continue
its conservative liquidity management practices, while the bank's
funding base will likely remain stable.

WHAT COULD MOVE THE RATINGS UP / DOWN

The positive outlook on Uralsib's long-term deposit ratings might
translate to a ratings upgrade over the next 12 to 18 months if
the bank demonstrates a sustainable track record of profitable
performance coupled with improved asset quality and capital
metrics.

Moody's does not anticipate any negative rating action on Uralsib
over the next 12 to 18 months, given the positive outlook
assigned to the bank's ratings. However, the outlook could be
reversed to stable if the bank's performance proves to be weaker
than Moody's current expectations.

PRINCIPAL METHODOLOGY

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

Headquartered in Moscow, Russia, Bank Uralsib reported -- under
its 2016 audited IFRS financial statement -- total assets of
RUB382 billion and total equity of RUB63 billion. The bank's IFRS
profits for 2016 stood at RUB2.0 billion.


LOCKO-BANK: Moody's Hikes Deposit Ratings to B1, Outlook Stable
---------------------------------------------------------------
Moody's Investors Service has upgraded Moscow-based Locko-bank's
long-term local and foreign-currency deposit ratings to B1 from
B2, reflecting its robust financial fundamentals and its
demonstrated resilience to the economic and banking downturn of
2014-15. The outlook on these deposit ratings remains stable.

The rating agency has also upgraded Locko-bank's baseline credit
assessment (BCA)/adjusted BCA to b1 from b2 and its Counterparty
Risk Assessment (CR Assessment) to Ba3(cr) from B1(cr).
Concurrently, Moody's affirmed the bank's Not Prime short-term
local and foreign-currency deposit ratings and its Not Prime(cr)
short-term CR Assessment. The overall outlook on the bank's
ratings remains stable.

RATINGS RATIONALE

The upgrade takes into account Locko-bank's consistently strong
profitability, with average pre-provision income at 4.1% of its
assets, average net interest margin of 5.1% and average return on
average assets (ROAA) of 2.0% in 2012-16. The bank has a solid
capital buffer (Basel I Tier 1 of 19.1% as of January 1, 2017),
which strengthened as a result of the recent loan book
contraction, in line with the sector trend.

Locko-bank's funding and liquidity profile is solid, with its
dependence on wholesale funding reduced to just 14% of tangible
assets, and unencumbered liquid assets amounting to almost 30% of
total assets, as of January 1, 2017.

According to Moody's, the key challenges for Locko-bank in the
next 12-18 months will include (1) improving the coverage of its
problem loans with loan loss reserves, which in 2016 fell to 78%
from 91%, and (2) managing its asset quality amid the recent
rapid growth of consumer loans (+94% in 2016) and ambitious
lending growth plans for 2017. However, Moody's believes these
risks are manageable, given the bank's strong capital cushion and
pre-provision profitability, which are currently better than the
average for b1- rated peers.

WHAT COULD CHANGE THE RATINGS UP/DOWN

A pre-requisite for a further positive rating action would be
Locko-bank's demonstrated ability to sustain its profitable
performance and keep good control of asset quality after its
current rapid expansion into retail lending is completed.

Locko-bank's ratings could be downgraded if its asset quality
deteriorates beyond Moody's current expectations, leading to
significant erosion of the bank's capital cushion.

PRINCIPAL METHODOLOGY

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

Headquartered in Moscow, Russia, Locko-bank reported, at January
1, 2017, total IFRS assets of RUB79.6 billion and total equity of
RUB13.5 billion. The bank's IFRS profits for 2016 amounted to
RUB2.0 billion.


SOVCOMFLOT PAO: Fitch Alters Outlook to Pos. & Affirms BB IDR
-------------------------------------------------------------
Fitch Ratings has revised the Outlook on Russia-based PAO
Sovcomflot's Long-Term Issuer Default Rating (IDR) to Positive
from Stable. Fitch has also affirmed Sovcomflot's Long-Term IDR
and SCF Capital Designated Activity Company's (formerly SCF
Capital Limited) senior unsecured notes, which are guaranteed by
Sovcomflot, at 'BB'.

The revision of Outlook reflects the improving quality of the
company's long-term contracts as the delivery of new LNG and
offshore vessels will be completed in 2017 and the company will
fully benefit from longer-term contracted revenue from 2018. This
is somewhat offset by growing market risk exposure in crude oil
and oil product tankers segments, and continuously sizable capex.
An upgrade may be driven by the improvement in the company's
business mix if it is able to demonstrate its ability to sustain
healthy cash flow also from conventional segments in crude oil
and oil product segments and/or lower capex spending.

The 'BB' rating continues to incorporate a one-notch uplift to
its 'BB-' standalone rating for parental links with its sole
shareholder, the Russian state (BBB-/Stable).

KEY RATING DRIVERS

Portfolio Optimisation: Fitch positively views the company's
gradual portfolio shift to industrial segments including LNG/LPG
shipping and offshore projects in the medium term. This is
because they are generally more profitable and are under longer-
term, fixed-rate contracts compared with crude oil and oil
product transportation, enhancing Sovcomflot's business mix and
cash flow visibility. This will partially mitigate Sovcomflot's
exposure to market risk in the tanker shipping business, which is
expected to generate about half of Time Charter Equivalent (TCE)
revenue, largely on spot.

Gas/Offshore to Increase Revenue Share: During 2013-2017, the
company is introducing 16 new vessels, all under long-term
contracts lasting between seven to 30 years. Most of these
vessels are either LNG/LPG or offshore services vessels (two LPG,
five LNG and seven offshore service vessels) and Fitch expects
gas and offshore services will generate about 45% of total TCE
revenue from 2017 (about 35% in 2016).

Healthy Credit Metrics: Fitch expects the company's credit
metrics to remain strong for the rating over the next 4 years.
Fitch estimates funds flow from operation (FFO) adjusted net
leverage to be 4.5x on average and FFO fixed charge coverage to
be 3.6x on average over 2016-2020. The credit metrics are
supported by stable TCE revenue with a healthy portion of long-
term contracts, robust performance and a more balanced segmental
portfolio. They are, however, constrained by sizeable expected
capex of around USD710 million in 2017 and at about USD500
million annually thereafter, slow recovery of tanker rates and
additional purchase of used vessels.

Given the volatile nature of freight rates, Fitch has taken a
through-the-cycle approach and assumed 10-year average spot
tanker rates for the company's spot operations over 2017-2020.
Fitch does not includes any potential IPO proceeds in Fitch
projections.

Diversified Customer Base: Sovcomflot has a diversified customer
base consisting of large international and Russian oil and gas
players. Its policy provides for limiting exposure to any
counterparty to around 10% of revenue. The company purchased all
of its LNG vessels for the projects that are already operational.
According to Sovcomflot, the rates under long-term contracts are
set for the duration of the contract and are not dependent on oil
or gas prices dynamics.

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

Solid Business Profile: Sovcomflot's business profile is
underpinned by a fairly high share of long-term contracts, with
about USD7.7 billion of contracted revenue (excluding JVs), and
with about two-thirds of the fleet being on time charters in
2016. Strong operations are also supported by the company's
leading global position as tanker owner and in certain niche
markets, a fairly young fleet and diversified customer base.

Senior Unsecured in Line with IDR: Fitch continues to align the
senior unsecured rating with the company's Long-Term IDR. As the
company's secured debt-to-EBITDA ratio of about 3.4x is above
Fitch's threshold of 2.5x Fitch also take into consideration the
unencumbered assets-to-unsecured debt ratio. This ratio is
temporarily weaker at just below 2x due to the timing difference
in the repayment of the outstanding notes after refinancing.
However, Fitch would considers decoupling the ratings if the
amount of unencumbered assets falls below 2x on a sustained
basis.

DERIVATION SUMMARY

Sovcomflot's ratings are underpinned by a robust business profile
supported by large-scale business, a healthy share of long-term
contracts, improved credit metrics, a fairly young and
specialised fleet and diversified customer base. The company
enjoys a one-notch uplift due to strong support from the Russian
government. No country-ceiling and operating environment aspects
impact the ratings.

KEY ASSUMPTIONS

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

- 10-year average freight rates for spot operations from 2017;
   contractual rates for time charters;

- Capex of USD710 million in 2017 and USD500 million annually
   thereafter;

- Capacity expansion as per management business plan.

RATING SENSITIVITIES

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

- FFO adjusted net leverage well below 4.5x and FFO fixed charge
cover above 3.5x on a sustained basis, due to, among other
things, strong recovery of the tanker industry, significant
downsizing of the capex programme or reinvestment of IPO
proceeds.

- Evidence of stronger state support.

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

- Decline of tanker rates or more sizeable capex resulting in
deterioration of the company's credit metrics (eg FFO adjusted
net leverage above 5.5x and FFO fixed charge coverage below 2.5x
on a sustained basis).

- Evidence of weaker state support.

- Unencumbered assets falling below 2x of unsecured debt on a
sustained basis, which would lead to a downgrade of the senior
unsecured rating.

LIQUIDITY

Strong Liquidity Position: Fitch views Sovcomflot's liquidity as
adequate as the company's unrestricted cash position of USD433
million at end-2016 along with its undrawn portion of committed
credit lines at USD711 million (95% of which is due in or after
2022) is sufficient to cover short-term debt of USD604 million in
2017. Its debt repayment schedule is well-balanced as the
remaining share of USD140 million of its USD800 million Eurobonds
due in 2017 has been refinanced with a new tap issue of USD150
million Eurobonds due in 2023 placed in 2Q17.

As a global tanker shipping player, the company has demonstrated
good access to financial markets, having raised USD1.4 billion in
bank financing during June 2015-September 2016. Fitch expects
Sovcomflot to remain free cash flow- negative given capex of
USD710 million in 2017 and at around USD500 million per annum
thereafter. FX risk is low due to natural hedge as the company
generates revenue and cash flow in USD and raises debt in USD.
Capex is also denominated in USD, while operating costs are
mostly in USD.



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


BANCO POPULAR ESPANOL: To Be Acquired by Santander for EUR1
-----------------------------------------------------------
Ben Martin at The Telegraph reports that Spanish banking giant
Banco Santander SA has stepped in to the rescue ailing rival
Banco Popular Espanol SA by taking over the failing lender for
EUR1 in a watershed deal masterminded by EU regulators to avoid a
damaging collapse.

According to The Telegraph, Santander will tap its shareholders
for EUR7 billion in a rights issue to raise the capital needed to
shore-up Popular's finances in a dramatic private sector rescue
of Spain's sixth-largest lender.

It will inflict losses of approximately EUR3.3 billion on bond
investors and shareholders but crucially will avoid a taxpayer
bailout, The Telegraph discloses.

There has been growing concern about loss-making Popular amid
fears it would collapse under EUR37 billion of bad property loans
it has made, The Telegraph states.  Customers have been
withdrawing deposits in a run that has seen billions of euros
pulled in recent weeks and efforts by its new chairman, Emilio
Saracho, to sell the bank had come to naught, The Telegraph
relays.

With Popular's position looking increasingly precarious, the
European Central Bank (ECB) decided overnight that the lender was
"failing or likely to fail" and called in the Single Resolution
Board (SRB), which orchestrated the forced sale to Santander, The
Telegraph relates.

"The significant deterioration of the liquidity situation of the
bank in recent days led to a determination that the entity would
have, in the near future, been unable to pay its debts or other
liabilities as they fell due," The Telegraph quotes the ECB as
saying.

Banco Popular Espanol SA is a Spain-based commercial bank.  The
Bank divides its business into four segments: Commercial Banking,
Corporate and Markets; Insurance Activity, and Asset Management.
The Bank's services and products include saving and current
accounts, fixed-term deposits, investment funds, commercial and
consumer loans, mortgages, cash management, financial assessment
and other banking operations aimed at individuals and small and
medium enterprises (SMEs).  The Bank is a parent company of Grupo
Banco Popular, a group which comprises a number of controlled
entities, such as Targobank SA, GAT FTGENCAT 2005 FTA, Inverlur
Aguilas I SL, Platja Amplaries SL, and Targoinmuebles SA, among
others.  In January 2014, the Company sold its entire 4.6% stake
in Inmobiliaria Colonial SA during a restructuring of the
property firm's capital.


BANCO POPULAR ESPANOL: Moody's Cuts Unsec. Debt Rating to B3
------------------------------------------------------------
Moody's Investors Service downgraded Banco Popular Espanol,
S.A.'s long-term deposit ratings to B2 from Ba3 and the bank's
and its supported entities' long-term senior unsecured debt
ratings to B3 from B1 with a negative outlook. At the same time,
the rating agency downgraded: (1) the bank's standalone baseline
credit assessment (BCA) to caa1 from b3; and (2) its long-term
counterparty risk assessment (CR Assessment) to Ba3(cr) from
Ba2(cr).

The rating action was prompted by recent market developments and
the impact that these may have on Banco Popular's financial
fundamentals. Moody's believes that the continued negative
newsflow related to the future of Banco Popular has negatively
impacted customers' and investors' confidence. Banco Popular is
under increasing pressure to improve its risk-absorption capacity
and accelerate the execution of its de-risking strategy.

In downgrading the senior debt and deposit ratings of Banco
Popular, Moody's has also considered the changes in the bank's
liability structure over the last year. This, combined with the
rating agency's expectation of the evolution of the bank's
balance sheet, has resulted in a higher loss given failure for
these type of instruments.

As part of rating action, Banco Popular's subordinated debt
ratings were downgraded to Caa2 from Caa1 as well as various
ratings of preference stock to Ca(hyb) from Caa3(hyb), which are
guaranteed by Banco Popular and issued by several issuing
vehicles. The bank's short-term debt and deposit ratings of Not
Prime, as well as the bank's short-term CRA of Not Prime(cr),
were unaffected.

RATINGS RATIONALE

RATIONALE FOR THE DOWNGRADE OF THE STANDALONE BCA

The downgrade of Banco Popular's standalone BCA and adjusted BCA
to caa1 reflects Moody's rising concerns about the bank's
financial profile, following the continued negative newsflow
related to the immediate future of the bank and the impact this
may have on the bank's weak financial fundamentals. Moody's
believes that Banco Popular is increasingly pressured to enhance
its solvency levels and accelerate the reduction of its stock of
problematic assets.

Deposit funding has traditionally been Banco Popular's main
funding source (65% of total funding at end-March 2017). However,
Moody's notes that the bank's customer deposits declined to
EUR78.5 billion in 2016 (EUR82.2 billion a year earlier) and
continued declining to EUR77.2 billion in Q1 2017.

Banco Popular's capital position deteriorated in 2016, after the
bank reported an EUR3.5 billion loss for the year, which exceeded
the EUR2.5 billion capital raised by the bank in June. At end-
March 2017, Banco Popular's phased-in Common Equity Tier 1 (CET1)
ratio stood at 10.0%, down from 12.8% a year earlier, and its
total capital ratio (TCR) at 11.9%, down from 13.5%. Moody's
notes that this ratio is closer to the bank's 2017 Pillar II
supervisory review and evaluation process (SREP) total capital
requirement of 11.375%. The bank had a tight buffer of around 53
basis points against this regulatory capital ratio, equal to
approximately EUR326 million.

Since the announcement of the revised strategic targets last
year, Banco Popular has managed to make only limited progress in
its assets disposal plan. The bank's non-performing assets (NPAs;
defined as non-performing loans and real estate assets) ratio
stood at 32% at end-March 2017, up from 30% a year earlier and
largely exceeding the system average of around 15%. Furthermore,
when aggregating refinanced loans which are not already captured
in the NPA ratio, the overall ratio increases to 36%, indicating
the magnitude of the existing balance-sheet pressures.

The rating agency acknowledges that the increase in coverage of
NPAs in 2016 to 45% is supportive of the bank's efforts to reduce
NPAs. However, this coverage level remains below that of its
domestic peers (average for the system at 50%) and Moody's views
that it will still be challenging for Banco Popular to sell parts
of its NPA portfolios without additional haircuts.

RATIONALE FOR THE DOWNGRADE OF THE LONG-TERM SENIOR RATINGS

The downgrades of Banco Popular's long-term deposit ratings to B2
from Ba3 and the bank and its supported entities' senior
unsecured debt ratings to B3 from B1 reflect: (1) the downgrade
of the bank's BCA and adjusted BCA to caa1; (2) the result of the
rating agency's Advanced Loss-Given Failure (LGF) analysis, which
now results in a one notch of uplift for the deposit ratings and
no uplift for the senior debt ratings from two and one notches of
uplift respectively previously; and (3) Moody's assessment of
moderate probability of government support for Banco Popular,
which results in an unchanged further one notch of uplift for
both the deposit and the senior debt ratings.

The rating action reflects the changes in Banco Popular's
liability structure over the last year, in particular the lower
volume of deposits and senior debt. This, together with Moody's
expectations of the evolution of the bank's balance sheet, has
resulted in a higher loss given failure for deposit and senior
debt instruments.

RATIONALE FOR THE NEGATIVE OUTLOOK

The negative outlook on the long-term deposit and backed debt
ratings captures the downward rating pressure that could develop
if the bank fails to restore solvency levels and reduce the stock
of problematic assets. Any deterioration in the bank's liquidity
position beyond Moody's expectations could also exert downward
pressure on the ratings.

RATIONALE FOR DOWNGRADING THE CR ASSESSMENT

As part of rating actions, Moody's also downgraded by one notch
the long-term CR Assessment of Banco Popular to Ba3(cr) from
Ba2(cr), four notches above the adjusted BCA of caa1. The CR
Assessment is driven by the bank's caa1 adjusted BCA, the cushion
against default provided to the senior obligations represented by
the CR Assessment by subordinated instruments amounting to 16% of
tangible banking assets providing three notches of uplift and a
moderate likelihood of systemic support, leading to another notch
of uplift for the CR Assessment.

WHAT COULD CHANGE THE RATING UP/DOWN

An upgrade of Banco Popular's ratings is currently unlikely given
the negative outlook. However, the bank's BCA could be upgraded
as a consequence of: (1) a significant improvement of asset risk
indicators coupled with a higher than expected improvement in the
bank's risk-absorption capacity; and (2) a sustained recovery of
recurrent profitability levels. Furthermore, Banco Popular's
ratings could benefit if it were to be acquired by a stronger
peer.

Downward pressure could be exerted on Banco Popular's BCA if: (1)
the bank fails to improve its risk-absorption capacity due to
continued asset quality weakening and/or additional provisioning
efforts in excess of its organic and inorganic capital generation
capacity; and/or (2) the bank's liquidity profile deteriorates
beyond Moody's expectations.

Any change to the BCA would likely also affect debt and deposit
ratings, as they are linked to the BCA. Banco Popular's senior
unsecured debt and deposit ratings could also change as a result
of changes in the loss-given-failure faced by these securities.

In addition, any changes to Moody's considerations of government
support could trigger downward pressure on the bank's deposit and
debt ratings.

LIST OF AFFECTED RATINGS

Issuer: Banco Popular Espanol, S.A.

Downgrades:

-- Long-term Counterparty Risk Assessment, downgraded to Ba3(cr)
    from Ba2(cr)

-- Long-term Bank Deposits, downgraded to B2 from Ba3, outlook
    remains Negative

-- Senior Unsecured Medium-Term Note Program, downgraded to
   (P)B3 from (P)B1

-- Subordinate Regular Bond/Debenture, downgraded to Caa2 from
    Caa1

-- Subordinate Medium-Term Note Program, downgraded to (P)Caa2
    from (P)Caa1

-- Preferred Stock Non-cumulative, downgraded to Ca(hyb) from
    Caa3(hyb)

-- Adjusted Baseline Credit Assessment, downgraded to caa1 from
    b3

-- Baseline Credit Assessment, downgraded to caa1 from b3

Outlook Action:

-- Outlook remains Negative

Issuer: BPE Finance International Limited

Downgrades:

-- Backed Senior Unsecured Regular Bond/Debenture, downgraded to
    B3 from B1, outlook remains Negative

Outlook Action:

-- Outlook remains Negative

Issuer: BPE Financiaciones, S.A.

Downgrades:

-- Backed Senior Unsecured Regular Bond/Debenture, downgraded to
    B3 from B1, outlook remains Negative

-- Backed Senior Unsecured Medium-Term Note Program, downgraded
    to (P)B3 from (P)B1

-- Backed Subordinate Regular Bond/Debenture, downgraded to Caa2
    from Caa1

-- Backed Subordinate Medium-Term Note Program, downgraded to
    (P)Caa2 from (P)Caa1

Outlook Action:

-- Outlook remains Negative

Issuer: Banco Pastor, S.A.

Downgrade:

-- Subordinate Regular Bond/Debenture, downgraded to Caa2 from
    Caa1, (assumed by Banco Popular Espanol, S.A.)

Outlook Action:

-- No Outlook assigned

Issuer: Pastor Particip. Preferent., S.A. Unipersonal

Downgrade:

-- Backed Preferred Stock Non-cumulative, downgraded to Ca(hyb)
    from Caa3(hyb)

Outlook Action:

-- No Outlook assigned

Issuer: Popular Capital, S.A.

Downgrades:

-- Backed Preferred Stock Non-cumulative, downgraded to Ca(hyb)
    from Caa3(hyb)

Outlook Action:

-- No Outlook assigned

PRINCIPAL METHODOLOGY

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



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


LANSDOWNE MORTGAGE NO. 1: Fitch Affirms CC Ratings on 4 Tranches
----------------------------------------------------------------
Fitch Ratings has affirmed all tranches of Lansdowne Mortgage
Securities No. 1 Plc (LMS1) and Lansdowne Mortgage Securities No.
2 Plc (LMS2). Both transactions contain pre-crisis Irish non-
conforming mortgages loans originated by Start Mortgages Ltd.

KEY RATING DRIVERS

Asset Performance and Restructures
The reported loss severity rates in both transactions are
significantly higher than Fitch's expectations. Fitch therefore
increased its market value decline (MVD) assumption by 50%. Fitch
used the loan-by-loan data provided to apply its foreclosure
frequency assumptions. For restructured loans the loan level data
regarding restructure type was limited compared with Fitch's
criteria. Fitch applied conservative assumptions when re-
categorising each loan in line with its criteria, resulting in
around 60% of both pools being classified as restructured, with
the majority of such loans receiving a foreclosure frequency
increase of at least 70%. These assumptions have directly
supported the affirmation of the note ratings.

Loans that are three or more months in arrears, stood at around
54% for both transactions, as at March 2017. This is a
considerable reduction of around 14pp for LMS1 and 12pp for LMS2
from March 16, which in Fitch's opinion has been driven by loan
restructuring, an improving economic environment and loans being
transferred to possession.

As at March 2017, the stock of possession loans stood at around
0.9% and 2.3% of the current pool balance of LMS1 and LMS2,
respectively.

Payment Interruption Risk
The transactions may be unable maintain timely payments on the
most senior notes outstanding in a payment interruption event.
This is because current reserve fund balances are expected to be
depleted by losses going forward. As there is no dedicated
liquidity, note payments will be exposed to payment interruption
in such event. This has constrained some of the senior note
ratings.

Credit Enhancement (CE) Build-up
CE on the most senior note during March 2016-March 2017 has
increased to 45.1% from 42.2% for LMS1 and 27.2% from 25.7% for
LMS2, resulting in affirmations. The transactions are expected to
continue paying sequentially and CE is expected to continue to
grow, subject to reserve fund draws to cover for losses.

VARIATIONS FROM CRITERIA

Due to higher-than-expected reported loss severity rates and
insufficient detailed information to analyse underlying recovery
performance Fitch applied a 50% increase in the MVD assumption
relative to its criteria assumption. For example, at 'Bsf' a MVD
of 72.9% was assumed for properties in Dublin.

RATING SENSITIVITIES

If the transactions continue to report decreasing late stage
arrears, Fitch may reduce its foreclosure frequency assumptions.
This may result in an upgrade of the note ratings if credit
enhancement levels are maintained.

Fitch has affirmed the following ratings:

Lansdowne Mortgage Securities No. 1 Plc
Class A2 (XS0250832614): affirmed at 'CCCsf': Recovery Estimate
(RE) 100%
Class M1 (XS0250833695): affirmed at 'CCsf': RE 90%
Class M2 (XS0250834073): affirmed at 'CCsf': RE 0%
Class B1 (XS0250834404): affirmed at 'CCsf': RE 0%
Class B2 (XS0250835120): affirmed at 'CCsf': RE 0%

Lansdowne Mortgage Securities No. 2 Plc
Class A2 (XS0277482286): affirmed at 'CCCsf': RE revised to 90%
from 100%
Class M1 (XS0277482526): affirmed at 'CCsf': RE revised to 0%
from 90%
Class M2 (XS0277482955): affirmed at 'CCsf': RE 0%
Class B (XS0277483417): affirmed at 'CCsf': RE 0%


SAAD INVESTMENTS: June 14 Creditors Meeting Set
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A meeting of creditors of Saad Investments Company Limited,
registration number 36729 whose registered office is situated at
Grant Thornton Specialist Services (Cayman) Limited, 10 Market
Street, PO Box #765, Camana Bay, Grand Cayman, KY1 9006, Cayman
Islands is to be held on Wednesday, June 14, 2017, at 9:00 a.m.
Cayman time at the offices of Grant Thornton Specialist Services
(Cayman) Limited, 48 Market Street, 2nd Floor, Suite 4290,
Canella Court, Camana Bay, Grand Cayman, Cayman Islands.

Creditors may also attend the office of Linklaters LLP, 1 Silk
Street, London EC2Y 8HQ (at 3:00 p.m. UK time) where a conference
call will be established to the meeting in Cayman.  One of the
Joint Official Liquidators (JOLs) will be in attendance at the
London venue.

Attendance by telephone conference will also be possible.  Those
creditors wishing to attend the meeting by this means are
required to advise the JOLs of their intention to do so, and
apply for confidential dial-in details, by no later than 12:00
p.m. Cayman time (6:00 p.m. UK time) on Monday, June 12, 2017, by
contacting the JOLs on one of the following:

E-mail: SICLcreditorsmeeting@uk.gt.com
Tel No.: +1(345)769-7217 (contact Ms. Michal Segal)

Any creditor who fails to notify the JOLs of its intention to
participate in the meeting vial telephone conference may not be
granted access to the meeting.

In order for a creditor to attend and vote at the meeting,
whether in person or by telephone conference, the creditor is
required to complete and submit to the JOLs, by no later than
12:00 p.m. Cayman time (6:00 p.m. UK time) on Monday, June 12,
2017, a proof of debt form together with all supporting
documentation, if they have not done so previously.  Should you
require a proof of debt form please contact the JOLs using the
details provided below.

Those creditors who elect to participate in the meeting in
person, should also bring with them to whichever venue they
nominate a suitable form of identification.

Corporate creditors entitled to attend the meeting in person or
by telephone conference must appoint a proxy by completing and
returning a proxy form, which they may obtain by contacting the
JOLs on the details below.

Please note that both the proof of debt (unless previously
submitted) and proxy form are to be submitted to the JOLs by
returning the completed forms to either of the addresses for
service detailed below or by emailing the documents to the e-mail
address provided by 12:00 p.m. Cayman time (6:00 p.m. UK time) on
Monday, June 12, 2017.

Contact for Enquiries: Michal Segal,
Tel No: +1(345)769-7217
E-mail: michal.segal@uk.gt.com

Addresses for delivery of proofs of debt and proxy forms:

E-mail: SICLcreditorsmeeting@uk.gt.com

     -- or --

c/o Grant Thornton Specialist Services (Cayman) Limited
10 Market Street, PO Box #765
Camana Bay, Grand Cayman, KY1 9006
Cayman Islands
For the attention of Michal Segal

     -- or --

c/o Grant Thornton UK LLP
30 Finsbury Square, London EC2P 2YU
England
For the attention of Andrew Philpot



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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.


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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,
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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members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Joseph Cardillo at
856-381-8268.


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