TCREUR_Public/170627.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

           Tuesday, June 27, 2017, Vol. 18, No. 126



RAIFFEISEN BANK: S&P Assigns 'BB' Rating to AT1 Capital Notes


BANK OF CYPRUS: Moody's Hikes Long-Term Deposit Ratings to Caa1


SILLIA VL: Recom Italia Chosen as Preferred Bidder


SUEDZUCKER AG: S&P Raises Rating on EUR700MM Hybrid Bond to BB-


GREECE: Moody's Raises Long-Term Issuer Rating to Caa2
PUBLIC POWER: S&P Raises CCR to 'CCC' on Restored Cash Cushion


MKB BANK: Moody's Raises Deposit Ratings to B2, Outlook Stable


POPOLARE DI VICENZA: Italy Offers Guarantees of EUR17 Billion
POPOLARE DI VICENZA: EU Commissions Approves Liquidation Measures
POPOLARE DI VICENZA: Intesa Acquisition to Affect 3,900 Jobs


CARLYLE GLOBAL 2013-1: S&P Affirms 'B-' Rating on Cl. E-R Notes

* NETHERLANDS: Corporate Bankruptcies Up in May 2017


LENINGRAD OBLAST: S&P Affirms 'BB+' ICR, Outlook Stable
MEGAFON FINANS: Fitch Corrects February 6 Rating Release


CAIXABANK SA: Moody's Rates EUR1BB Add'l Tier 1 Securities B1
EUSKALTEL SA: S&P Affirms 'BB-' CCR, Outlook Stable


DIAMANTBANK: DGF Determines TAScombank as Assuming Bank
PRIVATBANK: EY Confirms Bank's Insolvency in 2016

U N I T E D   K I N G D O M

AI ROBIN: Moody's Assigns (P)B3 Corporate Family Rating
AI ROBIN: S&P Assigns Preliminary 'B' CCR, Outlook Stable
CO-OPERATIVE BANK: Halts Sale Process, Nears Rescue Plan
KIRS MIDCO 3: Moody's Assigns Definitive B3 CFR, Outlook Positive
KIRS MIDCO: Fitch Assigns B- Long-Term IDR, Outlook Positive

MOY PARK: S&P Maintains 'B+' CCR on CreditWatch Negative



RAIFFEISEN BANK: S&P Assigns 'BB' Rating to AT1 Capital Notes
S&P Global Ratings assigned its 'BB' long-term issue rating to
the proposed perpetual additional tier 1 (AT1) capital notes to
be issued by Raiffeisen Bank International AG (RBI;
BBB+/Positive/A-2).  The rating is subject to S&P's review of the
notes' final documentation.

S&P is assigning the issue rating in accordance with its criteria
for hybrid capital instruments, reflecting S&P's analysis of the
proposed instrument and RBI's creditworthiness.

S&P considers RBI a core subsidiary of the Raiffeisen Banking
Group (RBG) and therefore equalize S&P's long-term issuer credit
rating (ICR) on RBI with the RBG's group credit profile, which
S&P assess as 'bbb+'.  Given RBI's core group status, S&P rates
the proposed notes by notching down from our 'BBB+' ICR on RBI,
because S&P believes that support from RBG will flow to these
hybrid capital instruments.  This is in line with the approach
S&P applies in rating RBI's other outstanding subordinated and
hybrid instruments.

The 'BB' issue rating is four notches lower than the ICR,
reflecting the deduction of:

   -- One notch because the notes are contractually subordinated;
   -- Two notches as S&P expects the notes to have a Tier 1
      regulatory capital status; and
   -- One notch because the instrument includes a mandatory
      contingent capital clause that could lead to the full or
      partial temporary write-down of the principal amount.

The instrument has the mandatory write-down, linked to a
regulatory common equity Tier 1 (CET) ratio of 5.125% of the
consolidated RBI or the issuer level.  S&P treats this mandatory
trigger as a "nonviability" trigger and don't apply additional
notching to this instrument.  The reason for this is that Basel
III requirements and market expectations will likely require many
banks to operate with significantly higher capital than a CET 1
ratio of 5.125% implies.

Once the securities have been issued and confirmed as part of the
issuer's tier 1 capital base, S&P expects to assign intermediate
equity content to them.  This reflects S&P's understanding that
the notes are perpetual, regulatory tier 1 capital instruments
that have no step-up.  The payment of coupons is discretionary
and the notes can additionally absorb losses on a going-concern
basis through the write-down feature and the non-payment of
coupons, which is fully discretionary.


BANK OF CYPRUS: Moody's Hikes Long-Term Deposit Ratings to Caa1
Moody's Investors' Service has upgraded Bank of Cyprus Public
Company Limited's (BoC's) long-term local and foreign currency
deposit ratings to Caa1 from Caa2 and its Provisional Senior
Unsecured EMTN ratings to (P)Caa1; and Subordinated and Junior
Subordinated to (P)Caa2. The bank's Not Prime short term ratings
have been affirmed. The rating action is driven by the upgrade of
BoC's Baseline Credit Assessment (BCA) to caa1 from caa2. The
outlook on the long-term deposit ratings remains positive.

The upgrade of BoC's ratings reflects the improvement in the
bank's financial fundamentals- mainly profitability, asset
quality, capitalization and its funding position. Moody's expects
BoC to remain modestly profitable in 2017, following its return
to profitable performance in 2016 after five years of losses. The
rating agency also expects further improvement in the bank's
asset quality metrics as ongoing loan work-outs and collateral
sales are supported by the strong economic recovery.

The positive outlook reflects Moody's expectations of changes
over the next 12 to 18 months in the bank's liability structure,
mainly the issuance of debt.



The upgrade of BoC's BCA to caa1 and long-term deposit ratings to
Caa1 reflects the improvement in the bank's financial metrics,
mainly asset quality, capitalization, profitability and funding.
However, the ratings remain low reflecting the vulnerability of
the bank's capital base owing to the high stock of problem loans.

Moody's expects BoC's continued loan restructurings to lead to
further asset quality improvement. The bank's ratio of NPLs
(defined as loans 90 days past due and impaired loans) to gross
loans continued to decline to 40.0% as of March 2017 from its
peak of 53.2% in December 2014. Although higher, the ratio of
Non-Performing Exposures (the European Banking Authority's more
broad definition of problematic debt) to gross loans also
declined to 51.8% from 62.9% in December 2014. The coverage ratio
also improved with the loan loss reserves to NPLs ratio
increasing to 53.6% as of March 2017 from 38.2% in December 2014.

Moody's expects the bank to remain modestly profitable in 2017
supporting its capital levels. Although pre-provision profit will
continue to be consumed by sustained high credit costs, increased
new lending will likely support net interest income at current
levels. The bank's Common Equity Tier 1 capital ratio was 14.4%
as of March 2017 while the leverage ratio was 13.2%, a level the
rating agency expects the bank to maintain.

BoC's funding profile has also improved following strengthening
depositor confidence which allowed the bank to grow its deposits
and eliminate ELA funding in January 2017. The bank also issued
EUR250 of Tier 2 securities in January 2017 marking its return to
the debt markets. Deposits grew to 85% of liabilities as of March
2017 while the net loans to deposit ratio declined to 95% from
141% as of December 2014.


The positive outlook reflects Moody's expectations of changes in
the bank's liability structure. An increased cushion to
depositors against potential losses, such as through an issuance
of EUR500 million of senior debt, would result in one notch
uplift in the bank's deposit ratings following the application of
Moody's Loss Given Failure.

Factors That Could Lead To An Upgrade

Upward pressure could develop on the ratings following further
improvements in BoC's financial performance, mainly a further
reduction in the volume of NPLs and/or improvement in the
coverage ratio. A change in the bank's liabilities' waterfall
through the issuance of senior or additional subordinated debt
may also positively affect its deposit ratings.

Factors That Could Lead To A Downgrade

The outlook could stabilise if the bank's progress with loan
restructurings stagnates or if economic growth falters leading to
a reversal in the recent improvement to the bank's asset quality
metrics. The outlook may also stabilise if the changes Moody's
expects in the bank's liability structure do not materialise.

Although not currently anticipated given the positive outlook,
BoC's ratings may be downgraded if the bank's financial
fundamentals, mainly asset quality and capital weaken, while at
the same time the changes Moody's expects in the bank's liability
structure do not materialise.


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

List of affected ratings


-- LT Bank Deposits (Foreign Currency and Local Currency),
Upgraded to Caa1 Positive from Caa2 Positive

-- Junior Subordinate Regular Bond/Debenture, Upgraded to Caa2
from Caa3

-- Senior Unsecured MTN, Upgraded to (P)Caa1 from (P)Caa2

-- Subordinate MTN, Upgraded to (P)Caa2 from (P)Caa3

-- Junior Subordinate MTN, Upgraded to (P)Caa2 from (P)Caa3

-- Adjusted Baseline Credit Assessment, Upgraded to caa1
    from caa2

-- Baseline Credit Assessment, Upgraded to caa1 from caa2

-- LT Counterparty Risk Assessment, Upgraded to B1(cr)
    from B2(cr)


-- ST Bank Deposits (Foreign Currency and Local Currency),
Affirmed NP

-- Commercial Paper, Affirmed NP

-- ST Counterparty Risk Assessment, Affirmed NP(cr)


SILLIA VL: Recom Italia Chosen as Preferred Bidder
Emiliano Bellini at pv magazine reports that Recom Italia, the
Italian unit of Germany-based solar manufacturer Recom, was
chosen as preferred bidder for the acquisition of Sillia VL.

pv magazine relates that the announcement was given in a
statement of the Tribunal of Commerce of Lyon. Another offer from
French company FJBJ was considered less credible than that
submitted by the Italian company, the report says.

According to pv magazine, Recom's offer was limited to the
acquisition of Sillia's 50 MW production site in Lannion, in
northwestern France, and did not include the 150 MW Venissieux's
factory, in the east of the country, which Sillia acquired in
joint venture with French developer Urbasolar from Bosch in mid-

The 128 employees at the facility in Venissieux will receive
severance payments from the German group, while the 44 workers at
the factory in Lannion will maintain their jobs, the report

pv magazine says the employees at the Lannion's facility
published a video on Youtube in April to support the search for
potential investors. In the video, a representative of the
company said it had a potential order intake of 300 MW.

As reported in the Troubled Company Reporter-Europe on March 27,
2017, Renewables Now said the commercial court of Lyon has
placed French photovoltaic (PV) modules maker Sillia VL in

Sillia VL has a manufacturing capacity of 200 MWp. It employs a
total of 176, of which 130 in the commune of Venissieux, eastern
France, and 47 people in the commune of Lannion, northwestern


SUEDZUCKER AG: S&P Raises Rating on EUR700MM Hybrid Bond to BB-
S&P Global Ratings raised its long- and short-term corporate
credit ratings on sugar producer Suedzucker AG to 'BBB/A-2' from
'BBB-/A-3'.  The outlook is stable.

S&P also raised to 'BBB' from 'BBB-' its issue rating on
Suedzucker's senior unsecured notes, and to 'BB-' from 'B+' S&P's
rating on the EUR700 million hybrid bond, both issued by
Suedzucker International Finance B.V.

The upgrade reflects firstly S&P's view that Suedzucker's
improved operating performance in the financial year (FY; ending
February 2017) 2016/2017 led to stable cash flow generation and
improved credit metrics.  Adjusted debt/EBITDA decreased to 2.3x
(compared with 3.1x in the previous year) and funds from
operations (FFO) to debt rose to 37% while free operating cash
flow (FOCF) debt was stable at close to 15%.

Secondly, S&P believes that the rebound in operating performance
should continue, although more gradually, over the next two
years. S&P continues to believe that the end of EU sugar
production quotas in September 2017 should be positive for
revenue growth prospects, as Suedzucker will be able to increase
production volumes and generate export revenues, potentially
through its affiliate sugar trading firm ED&F Man.  The group
will be able to operate with a more flexible operating cost
structure (no regulated minimum beet price paid to farmers) and
higher operating efficiency in its sugar operations (longer
campaign and production volume should improve capacity
utilization and lower operating fixed costs).  S&P also believes
that the expansion of the other divisions outside sugar and
ethanol (namely fruits/juices and special products excluding
ethanol) should increase the share of earnings of more stable

That said, competition in sugar in Europe will likely increase,
sugar market prices are likely to be very volatile, and the
profitability of exports outside the EU will also depend on the
level of competition with lower-cost producers in emerging
markets (notably Brazil) and on the euro/U.S. dollar and
Brazilian real/U.S. dollar exchange rates.

Suedzucker's main business strength is the large size of its
sugar (29 factories and two refineries) and ethanol operations in
Europe, which enables economies of scale.  The production and
distribution facilities are located near the largest and most
productive beet and cereals cultivation areas in Europe (Germany,
France, and Central and Eastern Europe).  The group has long-term
supply relationships with a large supplier base, which includes
16,400 German beet growers who are also its main shareholders.

Suedzucker has leading regional and global market positions in
its main businesses.  In sugar, it is a top-three global producer
by volume and the largest in Europe.  In ethanol it is the
largest producer by volume in Europe.  It is also the global
leader in fruit preparations.  The group's customer base is
overall very diverse, mainly comprising food and beverage

Business weaknesses, in S&P's view, include the fact that the
majority of the group's revenues are derived from sugar and
ethanol, which have volatile market prices and profitability.
These activities are capital intensive, with large seasonal
movements in working capital in sugar, and sourcing is
geographically concentrated in one region.

In terms of its financial policy, S&P believes Suedzucker is
likely to maintain a relatively stable level of borrowings,
continue to favor bolt-on debt-financed acquisitions for its
various businesses, and maintain a consistent shareholder
remuneration policy.

The group's debt structure remains well diversified between
different debt instruments with recent proven access to capital
markets (whether through Suedzucker or its subsidiary Agrana).

S&P's new base case for FY2017/18 and FY2018/19 assumes:

   -- Revenues of EUR6.7 billion-EUR6.8 billion.  In first half
      (H1) FY2017/2018 S&P see revenue growth driven mostly by
      higher sugar prices.  In H2 FY2017/2018 and in FY2018/19,
      S&P sees higher sugar production volumes and export
      revenues offsetting a decline in EU sugar prices due to
      oversupply of sugar in Europe.  S&P assumes revenues from
      special products (outside bioethanol) and fruit
      preparations and juices increasing by about 2% annually.
      An adjusted EBITDA margin of around 12.5%-13.5%, driven
      mostly by higher sugar prices in the first half of
      FY2017/2018 and effects from operating leverage afterwards.
      From October 2017, profitability in sugar should be
      supported by the higher capacity utilization and a more
      flexible operating cost structure, despite likely lower
      sugar prices.  S&P assumes lower profitability in ethanol
      but stable profitability in fruits and juices.

   -- FFO of around EUR650 million-EUR750 million and FOCF of
      about EUR225 million-EUR300 million in 2017/2018 and
      2018/2019, assuming negative working capital movements in
      2017/2018 in sugar and capital expenditure (capex) of about
      EUR350 million-EUR360 million.

   -- Adjusted net debt of about EUR1.7 billion, which includes
      borrowings, subordinated hybrid debt (treated as 50%
      equity, 50% debt), EUR823 million of net pension deficit,
      about EUR200 million-250 million of aggregated debt-
      financed acquisition and cash-dividend payments.  S&P
      applies a 5% haircut to cash balances and marketable
      securities to reflect limited restricted cash within the

Based on these assumptions, S&P projects these credit metrics:

   -- FFO to debt of about 40%-45%;
   -- Debt to EBITDA of about 2.0x; and
   -- FOCF to debt of 15%-20%.

The issue rating on the EUR700 million subordinated hybrid bond
is 'BB-' and S&P assess it as having intermediate equity content
(50% debt, 50% equity).

Based on S&P's base-case scenario, it sees significant headroom
(above 30%) at the next financial covenant test.  S&P projects
that the cash-flow-to-revenues ratio will be close to 10% (versus
a minimum threshold of 5%) by Feb. 28, 2018.  This covenant is
tested annually and a ratio below 5% would trigger mandatory
interest deferral.

The issue rating is four notches below the 'BBB' corporate credit
rating on Suedzucker.  S&P deducts three notches for the
contractual subordination of the bond and the mandatory interest-
deferral features, as per S&P's criteria, plus an additional
notch to reflect the historical and potential volatility in
covenant headroom.  S&P has seen unexpected declines in covenant
headroom in the past due to the volatility of sugar and ethanol
prices translating into diverging revenues and net income for
Suedzucker, as in 2014/2015, when the covenant approached the 5%

The bond covenant is calculated as a ratio of consolidated net
income before minority interests and depreciation (consolidated
cash flow) divided by revenues.  If the ratio falls below 5%,
this does not constitute an event of default or a breach of
Suedzucker's other financial obligations.

The stable outlook reflects S&P's view that Suedzucker should be
able to maintain stable operating performance overall and
generate steady free cash flow over the next two years.  S&P
thinks that its sugar operations should notably benefit from
export opportunities and a more flexible operating cost structure
after the end of EU sugar production quotas at end-September
2017.  S&P also believes the diversification in special products
and fruits may help offset the volatility of the sugar and
ethanol operations.

S&P believes Suedzucker should be able to maintain S&P Global
Ratings-adjusted debt to EBITDA of 2x-3x, FFO to debt of 30%-45%,
and FOCF to debt of 15%-25% on a sustained basis.

S&P could lower the rating if it saw a prolonged decline in cash
flows from lower earnings in the sugar operations.  This could be
due to a sharp drop in market prices in Europe due to continued
large production oversupply and low world market prices after the
removal of EU export quotas in September 2017.  S&P would also
consider a negative rating action if Suedzucker were not able to
manage the high sugar price volatility expected in Europe from H2
2017/2018 by adjusting its operating cost base adequately.

Finally, S&P would take a negative view if Suedzucker developed a
higher pension deficit and more aggressive acquisition and
shareholder remuneration policies.

In terms of credit metrics, S&P could take a negative rating
action if it saw debt to EBITDA rising toward above 3x and FOCF
to debt decreasing toward 10%.

S&P could raise the rating if it saw Suedzucker's FOCF to debt
rising to 25%-40% on a sustained basis and adjusted debt/EBITDA
maintained at 2x.

This could be driven notably by Suedzucker substantially
developing its earnings base in its food and beverage and food
ingredients businesses.  S&P would also view positively higher
profitability in sugar driven by more operating cost efficiencies
and a less volatile operating margin in the sugar and ethanol


GREECE: Moody's Raises Long-Term Issuer Rating to Caa2
Moody's Investors Service has upgraded Greece's long-term issuer
rating as well as all senior unsecured bond and programme ratings
to Caa2 and (P)Caa2 from Caa3 and (P)Caa3, respectively. The
outlook has been changed to positive from stable.

Greece's short-term ratings have been affirmed, at Not Prime (NP)
and (P)NP.

The key drivers for rating action are:

1. Successful conclusion of the second review under Greece's
adjustment programme and release of a tranche of EUR8.5 billion
in the coming days. Beyond the near-term impact of allowing
Greece to repay upcoming maturities, Moody's considers the
conclusion of the review to be a positive signal regarding the
future path of the programme, as it required the Greek government
to legislate a number of important reform measures.

2. Improved fiscal prospects on the back of 2016 fiscal
outperformance, expected to lead soon to a reversal in the
country's public debt ratio trend. The government posted a 2016
primary surplus of over 4% of GDP versus a target of 0.5% of GDP.
Moody's expects the public debt ratio to stabilize this year at
179% of GDP, and to decline from 2018 onwards, on the back of
continued substantial primary surpluses.

3. Tentative signs of the economy stabilizing. While it is too
early to conclude that economic growth will be sustained, Moody's
expects to see growth this year and next, after three years of
stagnation and a cumulative loss in output of more than 27% since
the onset of Greece's crisis.

The decision to assign a positive outlook to the Caa2 rating
reflects Moody's view that the prospects for a successful
conclusion of Greece's third adjustment programme have improved,
which in turn raises the likelihood of further debt relief. The
euro area creditors have committed to further extend Greece's
repayment terms to the EFSF (European Financial Stability
Facility; senior unsecured Aa1 stable) if needed after August
2018 when the programme ends. Later repayment to official
creditors would improve Greece's capacity to service debt held by
private sector investors, to which Moody's ratings speak.

The long-term country ceilings for foreign-currency and local-
currency bonds have been raised to B3 from Caa2, to reflect the
reduced risk of Greece exiting the euro area, and the long-term
ceiling for foreign-currency and local-currency deposits has been
raised to Caa2 from Caa3. Moody's maintains a two-notch gap
between the bond and the deposit ceilings to reflect the ongoing
capital controls. The short-term foreign-currency bond and bank
deposit ceilings remain unchanged at Not Prime (NP).




The successful conclusion of the second review under Greece's
current programme and the release of an EUR8.5 billion tranche in
the coming days will allow the Greek government to repay upcoming
maturities of EUR6.6 billion in July, including to the ECB
(EUR3.9 billion) and private-sector bondholders (EUR2.3 billion).
It will also allow for the clearance of some of the government's
arrears, thereby injecting much needed liquidity into the

Moody's considers the importance of the second review to go
beyond the short-term financial support it will yield. It
required the Greek government to legislate a number of measures,
some of them politically difficult (such as further tax increases
and pension cuts, changes to employment legislation and some with
the potential to improve Greece's growth prospects over the
coming years (such as those aimed at strengthening the banking

Moody's also considers that the progress made on the Programme
illustrates how the risk of an exit from the euro area has
diminished somewhat. While the events of 2015 illustrate the
volatility of Greek politics, the current political situation is
calmer, and opinion polls indicate a broad-based shift of support
towards parties that are in favour of continued euro area


The government managed to exceed the fiscal targets for 2016,
posting a primary surplus of 4.2% of GDP versus a target of 0.5%
of GDP. Part of the stronger-than-expected performance was due to
temporary factors, but it also reflected improvements in tax
collection that Moody's considers to be more permanent in nature.
Moody's expects primary surpluses this year and next to be
smaller, but still large enough to ensure that the public debt
ratio starts to decline from next year onwards.

The government also legislated additional fiscal measures
totaling 2% of GDP for 2019 and 2020, which go beyond the end of
the current programme and would be activated if needed. These
provide some assurance that the fiscal stance will remain
appropriately tight in the coming years. Moody's expects the debt
ratio to stand at around 176% of GDP by end-2018, compared to the
peak of 179.7% in 2014. That said, the debt trend remains highly
vulnerable to growth and fiscal shocks and the decline will
likely be slow.


While it is too early to conclude that the economy has definitely
turned the corner, Moody's expects to see positive growth this
year, after three years of stagnation and a cumulative loss in
output of more than 27% since the onset of Greece's crisis.
Employment has been rising for more than a year, thereby
supporting private consumption. Investment is expected to get a
boost from an acceleration of EU structural funds that amount to
EUR15.2 billion (8.4% of 2017 GDP) for the 2014-2020 period. On
top of the EU structural funds, significant funding is available
from the European Investment Bank (EIB, Aaa stable) and the
European Bank for Reconstruction and Development (EBRD, Aaa
stable). Importantly, fiscal policy will be significantly less of
a drag on growth than in 2016.


The positive outlook reflects Moody's view that the prospects for
a successful conclusion of Greece's third adjustment programme
have improved. While significant implementation risks remain, the
'heavy lifting' in terms of legislating structural reform
measures has been achieved now, which in turn reduces political
risks related to the stability of the government. Successful
completion would be credit positive for Greece, inter alia
because of the further debt relief which it would likely bring.

Greece's euro area creditors have already committed to
considering a further extension of the weighted average
maturities of the EFSF loans and a further deferral of interest
and amortization on those loans, by up to 15 years. The IMF's
intention to remain involved via a new stand-by agreement and to
continue to press for additional debt relief also supports
Moody's view that steps will be taken to make Greece's debt
burden sustainable. The principle of linking debt relief to
economic growth outcomes -- which the Eurogroup will consider --
would be a further positive step for the country.


That said, Greece's economic, fiscal and political risks remain
very elevated. Negative scenarios -- in particular linked to
political events and delays in implementing the agreed measures -
- are entirely plausible. They are the key reason why Moody's
considers that a Caa2 rating remains appropriate, at least until
the means and extent of the promised medium-term debt relief has
been fully clarified, the conditions for any such debt relief are
clear, and a longer and stronger track record of parliamentary
and electoral acquiescence in reform implementation has been


Greece's ratings could be upgraded further if there was clear
evidence that the economy was on a sustained and reasonably
strong growth path, associated with solid implementation of
agreed reforms, including measures to address asset quality
problems in the banking sector. Agreement by Greece's official-
sector creditors to implement material further debt relief which
rendered Greece's debt burden more sustainable over the medium to
long-term would also place upward pressure on the rating,
provided there remained broad support for the fiscal and other
conditions associated with such relief.


Downward pressure on the ratings would emerge if there are signs
that the willingness of the Greek authorities to implement the
agreed measures wanes or a renewed lengthy period of political
uncertainty hampers the economic recovery and leads to a material
deviation from the fiscal targets.

GDP per capita (PPP basis, US$): 26,669 (2016 Actual) (also known
as Per Capita Income)

Real GDP growth (% change): 0% (2016 Actual) (also known as GDP

Inflation Rate (CPI, % change Dec/Dec): 0% (2016 Actual)

Gen. Gov. Financial Balance/GDP: 0.7% (2016 Actual) (also known
as Fiscal Balance)

Current Account Balance/GDP: -0.6% (2016 Actual) (also known as
External Balance)

External debt/GDP: [not available]

Level of economic development: Low level of economic resilience

Default history: At least one default event (on bonds and/or
loans) has been recorded since 1983.

On June 20, 2017, a rating committee was called to discuss the
rating of the Greece, Government of. The main points raised
during the discussion were: The issuer's economic fundamentals,
including its economic strength, have not materially changed. The
issuer's institutional strength/framework, have materially
increased. The issuer's fiscal or financial strength, including
its debt profile, has materially increased. The issuer's
susceptibility to event risks has not materially changed.

The principal methodology used in these ratings was Sovereign
Bond Ratings published in December 2016.

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



Issuer: Greece, Government of

-- LT Issuer Rating, Upgraded to Caa2 from Caa3

-- Senior Unsecured Regular Bond/Debenture, Upgraded to Caa2
    from Caa3

-- Senior Unsecured Medium-Term Note Program, Upgraded to
    (P)Caa2 from (P)Caa3

-- Senior Unsecured Shelf, Upgraded to (P)Caa2 from (P)Caa3


Issuer: Greece, Government of

-- Commercial Paper, Affirmed at NP

-- Other Short Term , Affirmed at (P)NP


Issuer: Greece, Government of

-- LT Country Ceiling Bank Deposit Rating, Raised to Caa2
    from Caa3

-- LT Country Ceiling Bond Rating, Raised to B3 from Caa2


Issuer: Greece, Government of

-- ST Country Ceiling Bond Rating, Remains at NP

-- ST Country Ceiling Bank Deposit Rating, Remains at NP

Outlook Actions:

Issuer: Greece, Government of

-- Outlook, Changed to Positive from Stable

PUBLIC POWER: S&P Raises CCR to 'CCC' on Restored Cash Cushion
S&P Global Ratings said that it had raised its long-term
corporate credit rating on Greek utility Public Power Corp. S.A.
(PPC) to 'CCC' from 'CCC-'.  The outlook is negative.

At the same time, S&P also raised the rating on PPC's senior
unsecured debt to 'CCC' from 'CCC-'.

The ratings were removed from CreditWatch with negative
implications, where S&P placed them on Feb. 9, 2017.

The upgrade reflects S&P's view of PPC's restored cash cushion,
thanks to about EUR625 million cash paid for the unbundling
process of IPTO, the national electricity transmission grid.

On June 20, 2017, the Greek government paid EUR295.6 million in
cash for a 25% direct stake in IPTO and State Grid paid EUR327.6
million for a 24% stake. PPC no longer holds a stake in IPTO.

The successful closing of the transaction has in fact temporarily
improved PPC's cash sources.  For this reason, S&P now expects
liquidity to be covered for the remainder of 2017.  However, a
potential liquidity shortfall could arise from the second quarter
of 2018 absent a roll-over of ongoing debt maturities.

That said, S&P notes that the company may have some leeway for
bridging 2018, which S&P don't currently account for in its base
case, such as:

   -- The disposal of the lignite plant and mines;
   -- A further increase of trade payables;
   -- A faster recovery of trade receivable from municipalities
      than expected;
   -- Postponements of capital expenditures (capex) of EUR100
      million-EUR150 million;
   -- The recently announced business streamline process aimed at
      reducing costs; and
   -- A potential receivable securitization transaction.

In 2018, the company will have to amortize around EUR500 million
of debt, of which S&P assumes only a small part will be
refinanced (around EUR50 million).

After 2018, S&P sees an extremely challenging liquidity situation
with about EUR2.0 billion debt maturing in the first six months
of 2019, comprising EUR500 million notes and a EUR1.2 billion
syndicated loan with Greek banks, both maturing in April 2019.
At this stage, S&P cannot exclude that the company will undertake
a debt restructuring to address its refinancing need, as clearly
the cash generated by operations is not enough to source all
PPC's contractual obligations.  Bank support seems unlikely in
S&P's view, as highlighted in April 2017, when the Greek banks
delayed the process of refinancing of the EUR200 million notes
due May 1, 2017, forcing the company to postpone its payables for
being able to honor such maturity.

Moreover, S&P understood that the Greek systemic banks not only
requested and obtained a guarantee on the new EUR200 million
financing under the form of 125% coverage from current and future
receivables, but also extended their request for a guarantee on
the existing indebtedness to a total of EUR300 million, which is
still under negotiation between PPC and banks.

In addition to that, S&P thinks PPC's cash generation from
operations will shrink substantially in 2017 due to:

   -- Loss of IPTO cash contribution from dividends;
   -- Negative impact of renewable subsidies borne by PPC; and
   -- Increasing market liberalization with new incumbents
      providing new services and selecting the best consumers
      progressively eroding PPC's market share.

PPC's working capital evolution remains highly uncertain, with a
continued very sizable amount of overdue receivables, there were
some positive changes in 2016 as the company started delaying
payments to its trade creditors.

S&P revised up its assessment of PPC's liquidity to less than
adequate from weak, mirroring the EUR625 million cash intake for
the IPTO unbundling, which provides visibility over cash outlays
for the 12 months started April 1, 2017.

The negative outlook reflects that a further liquidity shortage
could happen in 2018 if PPC were not able to properly address its
upcoming debt maturities with additional asset disposals or
internal actions.  It equally reflects the uncertainty
surrounding a timely plan to address the April 2019 refinancing
comprising the EUR500 million unsecured notes and the EUR1.2
billion syndicated loan with Greek Banks.

A downgrade could occur, most likely in 2018, if:

   -- PPC is unable to realize additional sources of cash with
      asset disposals, receivable securitizations, or further
      improvement of its cash balances through better cash flow
      generation or refinancing of amortizing debt maturities;

   -- PPC proves unable to secure a timely refinancing for the
      EUR500 million notes due April 2019; or

   -- If the company were to announce a debt renegotiation or

A revision of the outlook to stable is very unlikely, absent
increased visibility on how the company can address the sizable
April 2019 debt maturities.


MKB BANK: Moody's Raises Deposit Ratings to B2, Outlook Stable
Moody's Investors Service has upgraded to B2 from B3 the long-
term local and foreign-currency deposit ratings of MKB Bank Zrt.
(MKB). Concurrently, the bank's baseline credit assessment (BCA)
and its adjusted BCA were upgraded to caa1 from caa2 and its
long-term Counterparty Risk Assessment (CRA) was upgraded to
B1(cr) from B2(cr). The outlook on the bank's long-term deposit
ratings remains stable. MKB's short-term Not Prime deposit
ratings and Not Prime(cr) CRA are unaffected.

According to Moody's, the upgrade of MKB's ratings primarily
reflects the gradual improvement in the bank's financial
fundamentals, albeit at still weak levels, particularly the
continued reduction in problem loans and recovering


The upgrade of MKB's long-term deposit ratings to B2 from B3 was
driven by: (1) the upgrade of the bank's BCA to caa1 from caa2;
(2) maintaining two notches of rating uplift for deposit ratings
from Moody's Advanced Loss Given Failure (LGF) analysis; and (3)
no rating uplift from government support.

The upgrade of MKB's BCA reflects the reduced risks to the bank's
solvency owing to improvements in asset quality and return to
profitability in 2016 after six years of losses. The bank's
problem loans ratio declined to 21.5% in December 2016 from 30.1%
in December 2015 mostly due to a sizable reduction in the bank's
troubled commercial real estate (CRE) loans. Nevertheless, the
coverage of problem loans is modest at 54% and thus constrains
the bank's solvency. MKB lowered its non-core CRE portfolio to
HUF104 billion in December 2016 from HUF240 billion in December
2015. The bank has committed to reduce the size of this exposure
to less than HUF60 billion by 2019 as part of its strategy to
focus on small and midsize enterprise and retail lending and on
private banking services.

MKB's improving asset quality resulted in an 84% reduction in
loan-loss provisions in 2016, the main driver behind the
turnaround in profitability. The bank's return on average assets
rose to 0.47% in 2016 from negative 3.98% in 2015. Despite a 6.9%
increase in the net loan book during the past year, MKB's
operating income contracted by 18% as lower interest rates
constrained net interest income. Nevertheless, the bank's
earnings benefited from a 28% reduction in operating expenses
owing to efforts to improve operating efficiency through
organisational restructuring and automation.

Although positive earnings moderately improved MKB's reported
Tier 1 ratio to 12.04% in December 2016 from 11.28% in December
2015, leverage remains high compared with most of its Hungarian
peers, with the bank's shareholders' equity-to-assets ratio at
5.97%, versus a 10.54% average for the Hungarian banking system.
Moody's expects that the benign operating environment in Hungary
will continue to benefit the credit quality of Hungarian banks,
including MKB, over the next 12-18 months. MKB's ongoing loan
portfolio clean-up and rising lending levels will gradually
benefit the bank's financial fundamentals, albeit at weak levels.

MKB was privatised in July 2016 just before the completion of its
resolution. The bank's still weak financial profile and evolving
business model under new ownership and management remain key
challenges for a successful turnaround of the bank. The stable
outlook reflects Moody's view that the upside and downside risks
to MKB's ratings will be balanced in the next 12-18 months.


A further reduction in problem loans while improving
profitability and capitalisation could positively affect MKB's

Downward rating pressure could emerge if the bank's asset
quality, profitability and capital adequacy deteriorate

A change in the bank's liability structure may change the uplift
provided by Moody's Advanced LGF analysis and lead to a higher or
lower notching from the bank's adjusted BCAs, thereby affecting
deposit ratings.


Issuer: MKB Bank Zrt.


-- Adjusted Baseline Credit Assessment, upgraded to caa1 from

-- Baseline Credit Assessment, upgraded to caa1 from caa2;

-- Long-term Counterparty Risk Assessment, upgraded to B1(cr)
from B2(cr);

-- Long-term Bank Deposits (Local & Foreign Currency), upgraded
to B2 Stable from B3 Stable

Outlook Action:

-- Outlook remains Stable


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


POPOLARE DI VICENZA: Italy Offers Guarantees of EUR17 Billion
Rachel Sanderson, Alex Barker and Claire Jones at The Financial
Times report that Italy has moved to shore up confidence in its
fragile banking system after agreeing to pump EUR5 billion of
taxpayers' money into two failed mid-sized banks while handing
their good assets to Intesa Sanpaolo, the country's strongest

Pier Carlo Padoan, Italy's economy minister, said on June 25 that
the state would offer additional guarantees of up to EUR12
billion -- meaning a possible total of EUR17 billion -- to cover
losses from the two banks' bad loans, the FT relates.  According
to the FT, he said the initial EUR5.2 billion included EUR4.8
billion for Intesa to maintain its capital ratios following the
acquisition of the Veneto banks, as well as a further EUR400
million in guarantees against the risk that some of the credits
acquired by Intesa turn sour.

Italy's financial system has already put EUR3.5 billion into the
Veneto banks in the past year via the government-sponsored
backstop fund Atlante, the FT discloses.

The government decided to wind down Veneto Banca and Banca
Popolare di Vicenza, based in the country's prosperous industrial
north-eastern Veneto region, after the European Central Bank on
June 23 said they were failing, the FT notes.

Paolo Gentiloni, Italy's prime minister, said the intervention
was "important, urgent and necessary" to prevent a "disorderly
failure" of the two banks, according to the FT.

The move by Italian authorities, which spent the weekend
frantically drawing up the complicated decree, will in effect
mean that the Veneto banks' branches and employees will be part
of Intesa Sanpaolo by June 26, a move considered crucial to avoid
a deposit run, say people briefed on the discussions, the FT
states.  The decree still needs to be voted into law by
parliament within 60 days, the FT says.

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

POPOLARE DI VICENZA: EU Commissions Approves Liquidation Measures
The European Commission has approved, under EU rules, Italian
measures to facilitate the liquidation of BPVI and Veneto Banca
under national insolvency law.  These measures involve the sale
of some of the two banks' businesses to be integrated into Intesa
Sanpaolo. Deposits remain fully protected.

This announcement follows the declaration by the European Central
Bank (ECB), in its capacity as supervisory authority, of June 23,
2017, that Banca Popolare di Vicenza (BPVI) and Veneto Banca were
failing or likely to fail and the decisions by the Single
Resolution Board (SRB), the competent resolution authority, that
resolution action is not warranted in the public interest in
either case.  EU law foresees that, in such circumstances,
national insolvency rules apply and it is for the responsible
national authorities to wind up the institution under national
insolvency law.  In this context, if Member States consider
public support necessary to mitigate the effects of a bank's
market exit, EU State aid rules apply, in particular the 2013
Banking Communication, requiring that shareholders and
subordinated bondholders fully contribute to the costs (so-called
"burden-sharing") and competition distortions are limited. Senior
bondholders do not have to contribute and depositors remain fully
protected in line with EU rules.

Commissioner in charge of competition policy, Margrethe Vestager,
said: "Italy considers that State aid is necessary to avoid an
economic disturbance in the Veneto region as a result of the
liquidation of BPVI and Veneto Banca, who are exiting the market
after a long period of serious financial difficulties.  The
Commission decision allows Italy to take measures to facilitate
the liquidation of the two banks: Italy will support the sale and
integration of some activities and the transfer of employees to
Intesa Sanpaolo.  Shareholders and junior creditors have fully
contributed, reducing the costs to the Italian State, whilst
depositors remain fully protected.  These measures will also
remove EUR18 billion in non-performing loans from the Italian
banking sector and contribute to its consolidation."

The SRB has concluded that resolution action is not warranted in
the public interest for either BPVI or Veneto Banca, which means
that Italian authorities have to wind-down the banks under
Italian national insolvency procedures.  In this context, Italy
has determined that the winding up of these banks has a serious
impact on the real economy in the regions where they are most
active.  Outside the European banking resolution framework, EU
rules foresee a possibility for Italy to seek Commission approval
for the use of national funds to facilitate the liquidation by
mitigating such regional economic effects.  As the aided banks
exit the market there should be no distortion of competition in
European banking markets.

On June 24, 2017, Italy notified to the Commission its plans to
grant State aid to wind-down BPVI and Veneto Banca.  The measures
will enable the sale of parts of the two banks' activities to
Intesa, including the transfer of employees.  Italy selected
Intesa Sanpaolo (Intesa) as the buyer in an open, fair and
transparent sales procedure: The measures will also enable the
wind down of the remaining liquidation mass, financed by loans
provided by Intesa.

In particular, the Italian State will grant the following

Cash injections of about EUR4.785 billion; and
State guarantees of a maximum of about EUR12 billion, notably on
Intesa's financing of the liquidation mass.  The State guarantees
would be called upon notably, if the liquidation mass is
insufficient to pay back Intesa for its financing of the
liquidation mass.

Both guarantees and cash injections are backed up by the Italian
State's senior claims on the assets in the liquidation mass.
Correspondingly, the net costs to the Italian State will be much
lower than the nominal amounts of the measures provided.

The Commission found these measures to be in line with EU State
aid rules, in particular the 2013 Banking Communication.
Existing shareholders and subordinated debt holders have fully
contributed to the costs, reducing the cost of the intervention
for the Italian State.  Both aid recipients, BPVI and Banca
Veneto, will be wound up in an orderly fashion and exit the
market, while the transferred activities will be restructured and
significantly downsized by Intesa, which in combination will
limit distortions of competition arising from the aid.
The subsequent deep integration by Intesa will return the sold
parts to viability.  The Commission also confirmed that the
measures do not constitute aid to Intesa, because it was selected
after an open, fair and transparent sales process, fully managed
by Italian authorities, ensuring that the activities were sold at
the best offer available.


Banca Popolare di Vicenza is a small Italian commercial bank,
located in the Veneto Region, which mainly operates in the north-
eastern regions of Italy.  As of December 31, 2016, Banca
Popolare di Vicenza had around 500 branches and a market share in
Italy of around 1% in terms of deposits and around 1.5% in terms
of loans.  As of December 2016 the bank had total assets of
slightly below EUR35 billion.

Veneto Banca is a small Italian commercial bank, located in the
Veneto Region, which mainly operates in the North of the country.
As of 31 December 2016, Veneto Banca had around 400 branches and
a market share in Italy of around 1% in terms of deposits and in
terms of loans.  As of December 2016 the bank had EUR28 billion
of total assets.

In March 2017, BPVI and Veneto Banca made requests to the Italian
State for a "precautionary recapitalisation" to address their
capital shortfalls, which were then subject to discussion between
the Commission and the Italian authorities.  The EU banking
framework foresees that this exceptional possibility is subject
to strict conditions, including that the State support is
temporary and cannot be used to offset losses that the bank has
incurred or is likely to incur in the future.  A bank that is
declared as failing or likely to fail by the ECB is not eligible
for a precautionary recapitalisation.

Both BPVI and Veneto Banca have a very high amount of non-
performing loans (37% compared to Italian average of 18%) and
high operating costs.  They have been loss-making for a number of
years. The 2014 ECB comprehensive assessment identified capital
shortfalls, following which the two banks were put under
monitoring by the ECB.  In 2016, the Atlante fund invested
approximately EUR3.5 billion in BPVI and Veneto Banca.  However,
the financial position of the two banks deteriorated further in
2017, and the measures were insufficient to overcome the long-
lasting structural problems.  Furthermore, BPVI and Veneto Banca
have not yet completed the process of adjusting their balance
sheet to the requirements of the BRRD, which are aimed among
other things at limiting the impact of resolution or orderly
liquidation on the economy.

As a result of their financial difficulties, over the last two
years, the banks suffered from continuous outflow of deposits
(between June 2015 and March 2017 the banks lost 44% of their
deposit base).  To stabilise the liquidity situation, Italy
requested liquidity support measures in the form of State
guarantees, amounting to about EUR10 billion, approved by the
Commission in January 2017 and April 2017.
Procedural Background

Under EU rules, a failing bank should in principle be liquidated
under normal insolvency proceedings, except in cases where the
SRB considers that there is a public interest in placing the
institution under resolution because liquidation under normal
insolvency proceedings might jeopardise financial stability,
interrupt the provision of critical functions, and affect the
protection of depositors (see recital 45 of the BRRD).

If in the context of such national insolvency proceedings, Member
States consider public support necessary to mitigate the effects
of a bank's market exit, EU State aid rules apply, in particular
the 2013 Banking Communication.  These rules are temporary crisis
rules, based on an exceptional rule of the Treaty on the
Functioning of the European Union, Article 107(3)(b).
The non-confidential version of the decision will be made
available under the case number SA.45664 in the State Aid
Register on the competition website once any confidentiality
issues have been resolved.

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

POPOLARE DI VICENZA: Intesa Acquisition to Affect 3,900 Jobs
Reuters reports that Popolare di Vicenza reports that Intesa
Sanpaolo said on June 26 its planned acquisition of the good
assets of Banca Popolare di Vicenza and Veneto Banca could lead
to the closure of around 600 branches and the departure, on a
voluntary basis, of around 3,900 staff.

Intesa Sanpaolo said on June 26 its planned acquisition of the
good assets of Banca Popolare di Vicenza and Veneto Banca could
lead to the closure of around 600 branches and the departure, on
a voluntary basis, of around 3,900 staff, Reuters relates.

Italy began winding up the two failed regional banks on June 25
in a deal that could cost the state up to EUR17 billion (US$19
billion) and will leave the lenders' good assets in the hands of
Intesa, the nation's biggest retail bank, Reuters discloses.

Rome spent the weekend drafting an emergency decree to liquidate
the two banks, which collapsed after years of mismanagement and
poor lending, Reuters recounts.  According to Reuters, the decree
will have to be voted into law by parliament within 60 days.

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


CARLYLE GLOBAL 2013-1: S&P Affirms 'B-' Rating on Cl. E-R Notes
S&P Global Ratings affirmed its credit ratings on Carlyle Global
Market Strategies Euro CLO 2013-1 B.V.'s class A-1-R, A-2-R, B-R,
C-R, D-R, and E-R notes following the transaction's effective

Most European cash flow collateralized loan obligations (CLOs)
close before purchasing the full amount of their targeted level
of portfolio collateral.  On the closing date, the collateral
manager typically covenants to purchase the remaining collateral
within the guidelines specified in the transaction documents to
reach the target level of portfolio collateral.  Typically, the
CLO transaction documents specify a date by which the targeted
level of portfolio collateral must be reached.  The "effective
date" for a CLO transaction is usually the earlier of the date on
which the transaction acquires the target level of portfolio
collateral, or the date defined in the transaction documents.
Most transaction documents contain provisions directing the
trustee to request the rating agencies that have issued ratings
upon closing to affirm the ratings issued on the closing date
after reviewing the effective date portfolio (typically referred
to as an "effective date rating affirmation").

"An effective date rating affirmation reflects our opinion that
the portfolio collateral purchased by the issuer, as reported to
us by the trustee and collateral manager, in combination with the
transaction's structure, provides sufficient credit support to
maintain the ratings that we assigned on the transaction's
closing date.  The effective date reports provide a summary of
certain information that we used in our analysis and the results
of our review based on the information presented to us," S&P

S&P believes the transaction may see some benefit from allowing a
window of time after the closing date for the collateral manager
to acquire the remaining assets for a CLO transaction.  This
window of time is typically referred to as a "ramp-up period".
Because some CLO transactions may acquire most of their assets
from the new-issue leveraged loan market, the ramp-up period may
give collateral managers the flexibility to acquire a more
diverse portfolio of assets.

For a CLO that has not purchased its full target level of
portfolio collateral by the closing date, S&P's ratings on the
closing date and prior to its effective date review are generally
based on the application of S&P's criteria to a combination of
purchased collateral, collateral committed to be purchased, and
the indicative portfolio of assets provided to S&P by the
collateral manager, and may also reflect its assumptions about
the transaction's investment guidelines.  This is because not all
assets in the portfolio have been purchased.

"When we receive a request to issue an effective date rating
affirmation, we perform quantitative and qualitative analysis of
the transaction in accordance with our criteria to assess whether
the initial ratings remain consistent with the credit enhancement
based on the effective date collateral portfolio.  Our analysis
relies on the use of CDO Evaluator to estimate a scenario default
rate at each rating level based on the effective date portfolio,
cash flow modeling to determine the appropriate percentile break-
even default rate at each rating level, the application of our
supplemental tests, and the analytical judgment of a rating
committee," S&P said.

On an ongoing basis after S&P issues an effective date rating
affirmation, it will periodically review whether, in its view,
the current ratings on the notes remain consistent with the
credit quality of the assets, the credit enhancement available to
support the notes, and other factors, and take rating actions as
S&P deems necessary.

Carlyle 2013-1 is a European cash flow corporate loan
collateralized loan obligation (CLO) securitization of a
revolving pool, comprising euro-denominated senior secured loans
and bonds issued mainly by European borrowers.  CELF Advisors LLP
is the collateral manager.


Class             Rating

Carlyle Global Market Strategies Euro CLO 2013-1 B.V.
EUR415.2 Million Fixed- And Floating-Rate Notes (Including
EUR46.2 Million Unrated Notes)

Ratings Affirmed

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

* NETHERLANDS: Corporate Bankruptcies Up in May 2017
Statistics Netherlands reports that the number of corporate
bankruptcies in the country has risen.

In May 2017, it was 17 up from April, Statistics Netherlands
discloses.  The number of bankruptcies in April was the lowest in
over nine years, Statistics Netherlands notes.  The largest
increase in May was recorded in the sectors manufacturing, trade,
and information and communication, Statistics Netherlands says.

In the first five months of 2017, the number of bankruptcies was
around 25% down from the first five months of 2016, Statistics
Netherlands relays.

According to Statistics Netherlands, if the number of court
session days is not taken into account, 318 businesses and
institutions (excluding one-man businesses) were declared
bankrupt in May 2017.

With a total of 55, the trade sector suffered most, Statistics
Netherlands notes.

The number of bankruptcies also increased across most other
sectors, with the exception of the sector business services where
the number of bankruptcies decreased, Statistics Netherlands


LENINGRAD OBLAST: S&P Affirms 'BB+' ICR, Outlook Stable
S&P Global Ratings affirmed its 'BB+' long-term issuer credit
rating on the Russian region Leningrad Oblast.  The outlook is


The stable outlook on Leningrad Oblast reflects S&P's expectation
that, over the next 12 months, the region will maintain its
strong liquidity position and high operating balances.

Downside Scenario

S&P could lower the rating on Leningrad Oblast if the oblast's
budgetary performance and liquidity weakened as a result of a
pronounced reduction in tax revenues or a looser spending policy
at the oblast level.

Upside Scenario

S&P could raise the rating on Leningrad Oblast in the next 12
months if stronger revenue and expenditure management enabled the
oblast to structurally post surpluses.


S&P continues to assume that, in the coming three years,
Leningrad Oblast will post high operating balances that will help
contain its structural deficits.  Furthermore, S&P believes the
oblast will lean on cash to help narrow its deficits, thereby
maintaining a very limited debt burden.  Despite the use of cash
reserves, S&P expects the oblast will continue to post strong

A relatively weak economy in the context of a volatile
institutional framework.  Like other Russian regions, Leningrad
Oblast has very limited control over its revenues and
expenditures within the centralized institutional framework,
which remains unpredictable, with frequent changes to taxing
mechanisms affecting regions.  The federal government regulates
the rates and distribution shares for most taxes and transfers,
leaving only about 5% of operating revenues that the region can
manage.  The application of the consolidated-tax-payer-group, the
tax payment scheme used by corporate tax payers since 2012,
continues to undermine predictability of corporate profit tax
(CPT) payments. However, earlier this year the government placed
limits on the amount of losses interregional holdings are allowed
to apply to the tax base.  The change will likely support CPT
collections in the near term, in S&P's opinion, and partly
alleviate the impact from the decrease in the CPT redistribution
to local and regional governments (LRGs) from the federal level
by 1%; LRGs lost about Russian ruble (RUB3) billion (about US$50
million) in 2017.

Leningrad Oblast's economy benefits from its favorable location
surrounding the City of St. Petersburg and on the transit routes
to the EU, as well as from a continued inflow of investments into
transport and energy infrastructure and the manufacturing sector.
However, S&P believes that gross regional product per capita will
remain below US$10,000 over the next three years.

Similar to those of most Russian LRGs, Leningrad Oblast's
modifiable revenues (mainly transport tax and nontax revenues)
are low and don't provide much flexibility.  S&P forecasts that
modifiable revenues will account for less than 10% of the
oblast's operating revenues on average over the next three years.
On the expenditure side, the oblast's leeway remains limited by
the large share of inflexible social spending and the small size
of its self-financed capital program, which will account for
about 10% of total expenditures over 2017-2019.

S&P regards Leningrad Oblast's financial management as weak, as
we do for most Russian regional governments, mainly because of
unreliable long-term financial planning and weak management of
government-related entities compared with international peers.
At the same time, S&P views debt and liquidity management as
prudent and more sophisticated than that of most Russian peers.

Tighter balances but low debt, thanks to an important cash
cushion.  S&P believes that the oblast's operating margins will
tighten to about 5% of operating revenues in the coming three
years as revenue growth decelerates, compared with the previous
three years, in line with more stable ruble exchange rates; while
expenditures will remain relatively high, resulting in a modest
deficit after capital accounts of below 5% of total revenues.
S&P anticipates that, in the near term, CPT -- the oblast's key
revenue source -- will continue to account for about 50% of
operating revenues and remain volatile due to its strong link
with the cyclical oil industry.

Nevertheless, S&P thinks that in the coming years the oblast's
budgetary performance will be supported by growth in non-
commodity sectors (manufacturing, food, and transportation).  S&P
anticipates that growth will accelerate further in 2019 when a
new nuclear facility in the oblast will ramp up, positively
affecting both CPT and property tax collections.  S&P also
believes that, in line with lower growth in revenues in the
coming three years, management will tighten austerity measures on
expenditures by reducing the amount of subsidies granted, saving
on maintenance and repairs, and capitalizing on some downsizing
of the public sector.  The oblast has a track record of budgetary
discipline, and S&P thinks it will also need to maintain measures
of budget consolidation to keep its access to low interest budget
loans, because this government support hinges on keeping low
deficits and limited debt.

S&P anticipates that, in 2017-2019, the oblast will use its
accumulated cash to finance deficits.  Tax-supported debt will
therefore not exceed 10% of consolidated operating revenues
before 2019.  Excluding direct debt, S&P factors into the
oblast's tax-supported debt the guarantees that the oblast
provided to its government-related entities.  The oblast's
largest outstanding guarantee of RUB1.3 billion (about US$22
million), maturing in 2019, was granted to the oblast-owned hotel
Zvezdny in Sochi.

S&P views the oblast's contingent liabilities as very low, due to
the oblast's minimal involvement in the local economy.

S&P assumes that in the next 12 months, the oblast's average free
cash, net of the anticipated deficit after capital accounts, will
exceed its very low debt service, which S&P estimates at RUB1.6
billion (about US$27 million).  Similar toother Russian LRGs, in
our opinion, Leningrad Oblast's access to external liquidity is
limited, given the weaknesses of the domestic capital market and
the banking system.

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

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 that all rating factors remained

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.


                                     To              From
Leningrad Oblast
Issuer Credit Rating
  Foreign and Local Currency     BB+/Stable/-- BB+/Stable/--

MEGAFON FINANS: Fitch Corrects February 6 Rating Release
This commentary replaces the version published on February 6,
2017 to include the withdrawal of Russian National Scale Ratings
for MegaFon Finans LLC

Fitch Ratings has simultaneously affirmed and withdrawn Russian
National Scale ratings for non-financial corporate issuers. Of
this, one remained on Rating Watch Evolving at the time of
withdrawal. This rating action does not affect any existing
international ratings for non-financial corporates. The rating
actions are detailed in the Rating Action Report accessible by
the link provided.

The rating actions summarised in the attached Rating Action
Report follow the announcement by Fitch on December 23, 2016 that
it is to withdraw its National Scale Ratings in the Russian
Federation, following the introduction of a new regulatory
framework of the credit rating industry in Russia.


See relevant issuer Rating Action Commentary (RAC) cited


See relevant issuer RAC cited


See relevant issuer RAC cited


See relevant issuer RAC cited


See relevant issuer RAC cited

Links to recent RACs for issuers whose Russian National Scale
Ratings are being withdrawn are:

Fitch Affirms Aeroflot at 'B+'; off RWN; Outlook Stable
Fitch Affirms Russia's Miratorg at 'B+'; Outlook Stable
Fitch Affirms Metalloinvest at 'BB'; Outlook Stable
Fitch Affirms Atomenergoprom at BBB-; Outlook Negative
Fitch Assigns First-Time 'BB+' Ratings to Enel Russia; Outlook
Fitch Downgrades Russia's FESCO to 'RD'
Fitch Affirms Federal Passenger Company at 'BB+'; Outlook
Fitch Affirms PJSC Federal Grid Company UES at 'BBB-'; Outlook
Fitch Revises UCL Rail and Freight One Outlook to Stable; Affirms
at 'BB+'
Fitch Affirms Russia's Globaltrans at 'BB'; Outlook Stable
Fitch Affirms PJSC Inter RAO at 'BBB-'; Outlook Negative
Fitch Revises United Confectioners' Outlook to Stable; Affirms at
Fitch Affirms Eurochem Group AG at 'BB'; Outlook Negative (20 Sep
Fitch Upgrades Lenta to 'BB'; Outlook Stable
Fitch Affirms PJSC MegaFon at 'BB+'; Outlook Stable
Fitch Revises MMK's Outlook to Positive; Affirms at 'BB+'
Fitch Affirms MOESK at 'BB+'; Outlook Stable
Fitch Upgrades PJSC Mosenergo to 'BBB-'; Outlook Stable
Fitch Affirms MTS at 'BB+'; Outlook Stable
Fitch Affirms NLMK at 'BBB-'; Outlook Negative
Fitch Affirms Russia's Novatek at 'BBB-', Outlook Negative
Fitch Affirms OGK-2 at 'BB'; Outlook Stable
Fitch Affirms Russia's O'Key at 'B+'; Outlook Stable
Fitch Affirms Gazprom at 'BBB-'; Outlook Negative
Fitch Revises Synergy's Outlook to Stable; Affirms at 'B+';
Outlook Stable
Fitch Revises Acron's Outlook to Positive; Rates Bond Programme
at 'BB-(EXP)'
Fitch Affirms Russia's Gazprom Neft at 'BBB-'; Outlook Stable
Fitch Affirms PhosAgro at 'BB+'; Stable Outlook
Fitch Places Russia's Bashneft on Rating Watch Evolving on
Acquisition by Rosneft
Fitch Affirms Evraz at 'BB-'; off Watch Negative
Fitch Affirms Rostelecom PJSC at 'BBB-'; Outlook Stable
Fitch Affirms RusHydro at 'BB+'; Outlook Negative
Fitch Upgrades Russian Helicopters to 'BB+'; Outlook Stable
Fitch Upgrades Severstal to 'BBB-'; Outlook Negative
Fitch Affirms Sistema at 'BB-', Outlook Stable
Fitch Affirms Sukhoi Civil Aircraft at 'BB-'; Outlook Negative
Fitch Revises Russia's T2 RTK Outlook to Negative; Affirms IDR
Fitch Affirms Russia's TransContainer at 'BB+'/Stable
CJSC Transtelecom Co.'s Outlook Revised to Stable From Negative
Fitch Affirms Russia's Ventrelt at 'BB-'; Outlook Stable
Fitch Rates Russian X5 Finance's RUB15bn Bond 'BB
Fitch Affirms Eurasia Drilling Company at 'BB'; Outlook Negative


CAIXABANK SA: Moody's Rates EUR1BB Add'l Tier 1 Securities B1
Moody's Investors Service has assigned a B1(hyb) rating to the
EUR1 billion Additional Tier 1 non-viability contingent capital
securities issued by CaixaBank, S.A. (CaixaBank) (Baa2
positive/Baa2 stable, ba1).

The B1(hyb) rating assigned to the notes is based on CaixaBank's
standalone creditworthiness and is positioned three notches below
the bank's ba1 adjusted baseline credit assessment (BCA): one
notch below to reflect high loss severity under Moody's Advanced
Loss Given Failure (LGF) analysis; and a further two notches
below to reflect the higher payment risk associated with the non-
cumulative coupon skip mechanism, as well as the probability of
the bank-wide failure. The LGF analysis also takes into
consideration the conversion feature, in combination with the
Tier 1 notes' deeply subordinated claim in liquidation.


According to Moody's framework for rating non-viability
securities under its bank rating methodology, the agency
typically positions the rating of Additional Tier 1 securities
three notches below the bank's adjusted BCA. One notch reflects
the high loss-given-failure that these securities are likely to
face in a resolution scenario, due to their deep subordination,
small volume and limited protection from residual equity. Moody's
also incorporates two additional notches to reflect the higher
risk associated with the non-cumulative coupon skip mechanism,
which could precede the bank reaching the point of non-viability.

The notes are unsecured and perpetual, subordinated to
unsubordinated and subordinated instruments that do not
constitute AT1 capital, and senior to ordinary shares. They have
a non-cumulative optional and a mandatory coupon-suspension
mechanism. A conversion into common shares is triggered if the
group's or the bank's transitional Common Equity Tier 1 (CET1)
capital ratio falls below 5.125%, which Moody's views as close to
the point of non-viability. At March 31, 2017, CaixaBank's
consolidated CET1 ratio stood at 11.9%, while its standalone CET1
ratio stood at 12.4%.


Any changes in the ba1 adjusted BCA of the bank would likely
result in changes to the B1(hyb) rating assigned to these
securities. In addition, any increase in the probability of a
coupon suspension would also lead us to reconsider the rating

Upward pressure on CaixaBank's BCA could be driven by a further
sustained improvement on its key financial metrics. Conversely,
downward pressure on the bank's standalone BCA could arise if
CaixaBank's credit profile weakens as a consequence of an
unexpected deterioration of any of its financial fundamentals.


The principal methodology used in this rating was Banks published
in January 2016.

EUSKALTEL SA: S&P Affirms 'BB-' CCR, Outlook Stable
S&P Global Ratings said it has affirmed its 'BB-' long-term
corporate credit rating on Euskaltel S.A.  The outlook is stable.

S&P is also affirming its 'BB-' issue rating on Euskaltel's term
loan B3.  The recovery rating is unchanged at '3', reflecting
significant recovery (50%-70%; rounded estimate: 55%) in the
event of default.

The affirmation reflects S&P's view that the acquisition of
Telecable will have a limited impact on the company's credit
quality, mainly due to the balanced funding split of debt and
equity, and the company's business risk profile remaining
constrained by its limited scale in comparison with peers.
Additionally, the affirmation is supported by the company's
continued solid operating performance, slightly outperforming
S&P's previous base case.

Euskaltel recently announced that it has entered into an
agreement to acquire full control over Telecable de Asturias,
S.A.U., a regional cable operator in Asturias, for a total value
of EUR686 million.  The acquisition will be funded through a
combination of cash and new term loans, as well as a capital
increase of EUR255 million subscribed by Telecable's current
shareholders, Zegona. The transaction is expected to close during
the third quarter of 2017.

While S&P currently forecasts a slight increase in Euskaltel's
leverage in 2017 to about 4.6x (up from 4.4x in 2016), the
company continues to display solid short-term deleveraging
prospects to comfortably less than the 4.5x threshold for the
rating through its growing free cash flow generation.
Additionally, S&P expects reduced leverage to be supported by
continued improvement in macroeconomic trends in Spain,
contributing to revenue growth, as well as transaction related
cost synergies, which will be realized over the 18 months after
the closing of the transaction.  Combined, this should enable
Euskaltel to reduce its adjusted debt to EBITDA toward 4x by
2018, despite S&P's assumption of continued and growing dividend
distributions in line with the company's guidance.

The addition of Telecable will somewhat increase the company's
scale and geographic reach, with pro forma group revenues growing
by about 24%.  However, Euskaltel's scale and reach after the
acquisition remains significantly smaller than its cable peers.
Additionally, S&P's assessment of the business risk profile
remains constrained by the highly competitive Spanish telecoms
market, with competition mainly from significantly larger and
better capitalised companies (e.g. Telefonica, Orange, and

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

   -- Revenue increase of about 1%-2% in 2017-2018 as a result of
      higher penetration of bundled products and ongoing customer
      up-sell in broadband, but somewhat offset by the loss of
      the Basque country contract and continued competition;

   -- EBITDA margin of about 49% in 2017 improving to nearly 51%
      in 2018, mainly thanks to the realization of cost

   -- Capital expenditures (capex) to sales of about 17.0%; and

   -- Dividend payments of EUR55 million in 2017, growing further
      in 2018.

Based on these assumptions, S&P arrives at these credit measures
in 2017:

   -- Adjusted debt to EBITDA of 4.6x in 2017, declining to about
      4.1x in 2018;

   -- Adjusted funds from operations (FFO) to debt of about 17%
      in 2017, increasing to about 19% in 2018; and

   -- Free operating cash flows (FOCF) to debt of more than
      6%-7%, increasing to more than 10% in 2018.

The stable outlook reflects S&P's anticipation that Euskaltel
will rapidly reduce leverage toward 4x over the short term
through improved market conditions, merger-related cost
efficiencies, and free cash flow generation.  It also reflects
S&P's view that there is a limited risk that the company will
increase balance sheet leverage over the medium term, given its
declared financial policy.

S&P sees the potential for a downgrade as limited over the next
12 months as that would require significant underperformance
compared with S&P's base-case scenario, given that the company's
solid free cash flow generation is contributing to short-term
debt reduction. S&P could lower the rating if adjusted leverage
remains sustainably higher than 4.5x, with no short-term prospect
of a reduction in leverage, and FOCF to debt declines to less
than 5%. This could happen if the company faced a significant
increase in competition, leading to meaningful erosion in prices
and customer losses.

Over the longer term, S&P could raise the rating if it assess the
combined company's business positioning more favorably, for
example, if it is successful in improving its EBITDA margins to
more than 50% while maintaining a very low churn rate, despite
increasing fiber coverage by its competitors.  S&P would also
expect the company to maintain adjusted leverage at or below 4x
and free cash flow to debt exceeding 10%.


DIAMANTBANK: DGF Determines TAScombank as Assuming Bank
Interfax-Ukraine reports that the Individuals' Deposit Guarantee
Fund has satisfied an offer made by TAScombank, owned by ex-head
of the National Bank of Ukraine Sergiy Tigipko, to act as an
assuming bank for part of the assets and liabilities of insolvent
Diamantbank, ex-head of Diamantbank Oleh Khodachuk has said.

"The Individuals' Deposit Guarantee Fund has just made the
decision on the assuming bank for the Diamantbank assets.
TAScombank was determined as an assuming bank," he wrote on his
Facebook page, Interfax-Ukraine relates.

According to Interfax-Ukraine, Mr. Khodachuk said the volume of
assets that is transferred will allow to fully compensate the
entire amount of deposits of up to UAH200,000. He noted at the
time of temporary administration introduction this amount was
UAH1.24 billion.

"But the most important news for depositors with the deposits
exceeding UAH200,000 is that the fund has kept the overall amount
of cash that was on the accounts and in the cash department of
the bank! At the time of administration introduction the figure
stood at almost UAH600 million," Interfax-Ukraine quotes Mr.
Khodachuk as saying.

The National Bank of Ukraine (NBU) on April 24, 2017, recognized
Diamantbank (Kyiv) insolvent.  Interfax-Ukraine said the NBU
board made corresponding decision No. 264-RSh/BT as by April 1
the bank failed to achieve the minimum level of regulatory
capital adequacy at a ratio of 5% established by the central
bank.  Following the National Bank's decision, the Individuals'
Deposit Guarantee Fund decided to withdraw the bank from the
market by introducing temporary administration for one month -
until May 23, 2017.

Tetiana Startseva has been appointed temporary administrator in
the bank

Diamantbank ranked 24th among 93 operating banks as of January 1,
2017, in terms of total assets worth UAH7.414 billion, according
to the NBU.

PRIVATBANK: EY Confirms Bank's Insolvency in 2016
Interfax-Ukraine reports that international audit firm EY has
confirmed PrivatBank's negative balance capital for work in 2016
at the level of UAH700 million, despite the fact that the Finance
Ministry had already channeled UAH107 billion into the bank's
capital before the reporting date.

Relevant data is contained in a report by EY after a
comprehensive audit of PrivatBank's financial statements and
liabilities, which was posted on the website of the creative
producer of the Channel 1+1 investigative journalism department,
editor of the TV program Groshi Oleksandr Dubinskyi, Interfax-
Ukraine says.

As an informed source told Interfax-Ukraine, the published report
is one of the working drafts. The final report whose publication
is expected in the near future states that the amount of the
bank's negative balance capital was UAH880 million.

A respective article on Dubinskyi's website also indicates that
the amount of PrivatBank's reserves for depreciation of loans in
2016 was UAH184.34 billion, including UAH154.5 billion accrued in
2016, Interfax-Ukraine states. At the same time, the bank's total
loan portfolio by the end of 2016 had amounted to UAH227.9
billion, which implies that more than 80% of the bank's loans
were non-performing loans.

Interfax-Ukraine relates that the source of the agency specified
that the indicators mentioned by the journalist approximately
correspond to those contained in the final report.

EY notes that it could not determine the period when the
depreciation of the loans by UAH154.5 billion occurred, according
to Interfax-Ukraine.

Balance capital, or equity, in bank accounting is a sum total of
paid-in charter capital, additional capital, reserve funds and
profits of previous years and the reporting period, Interfax-
Ukraine notes. Most often it is used for assessment and
comparison of capitalization to determine market value.

U N I T E D   K I N G D O M

AI ROBIN: Moody's Assigns (P)B3 Corporate Family Rating
Moody's Investors Service has assigned a first-time provisional
(P)B3 corporate family rating (CFR) to AI Robin Limited
("group"), an intermediate holding company of the merged group
following UK-based industrial products distributer Brammer
Limited's (Brammer) proposed acquisition of French IPH S.A.S.
Concurrently, Moody's has assigned provisional (P)B2 ratings to
the proposed EUR765 million senior secured first-lien term loan B
(maturing 2024) and EUR135 million equivalent senior secured
revolving credit facility (RCF, maturing 2023), to be raised by
AI Robin Finco Limited, a direct subsidiary of the group. The
outlook on all ratings is stable.

The new financing, which also comprises a EUR187 million second
lien term loan (unrated), in combination with common equity and
GBP140 million of preferred equity, will be used to fund the
acquisition of IPH from PAI Partners by funds advised by Advent
International (Advent), as well as to refinance existing debt at
Brammer. The transaction still requires regulatory and customary

Moody's issues provisional ratings in advance of the final sale
of securities. Upon closing of the transaction and a conclusive
review of the final documentation, Moody's will endeavour to
assign definitive ratings. Definitive ratings may differ from
provisional ratings.

"The assigned (P)B3 CFR with a stable outlook balances the
group's very high initial leverage pro forma for the proposed
acquisition of IPH, its moderate geographic diversity and
execution risk as to initiated cost reduction measures, with its
leading position as the number one industrial parts distributer
in Europe, expected earnings improvements thanks to merger
related synergies and positive free cash flow generation", says
Goetz Grossmann, Moody's lead analyst for Brammer/IPH.


The provisional (P)B3 CFR assigned to the combined Brammer/IPH
group is constrained by (1) a highly elevated Moody's-adjusted
leverage of around 7.8x debt/EBITDA expected at year-end 2017 pro
forma for the proposed transaction, although which Moody's
expects to decline towards 6.5x over the next 18 months, (2) the
group's geographic focus on certain western European markets such
as France, Germany and the UK (together almost 70% of combined
revenues), resulting in some sensitivity to economic cyclicality,
(3) operational issues at the level of Brammer, which have
weighed on profitability in 2016 and need to be resolved in a
timely manner to achieve anticipated profitability improvements,
(4) margin pressure due to higher customer rebates and price
pressure from key accounts in some regions, also in the context
of growing e-businesses, which adds to price transparency and
increased competition in some product segments, (5) high one-time
costs associated with initiated cost saving measures (e.g.
workforce reductions, branch network optimizations) and the
integration of IPH as well as potential future acquisitions, (6)
the challenge to expand e-commerce capabilities as planned by
management, in order to keep up with online competitors and to
meet rising demands of key accounts (e.g. system-integrated order
placements), and (7) risk of debt-funded strategic acquisitions,
which might lead to a delay in forecast de-leveraging and
potentially negative rating pressure.

Key credit strengths incorporated in the rating relate to (1) the
combined group's leading position as number one industrial parts
distributor in Europe, with (2) a dense distribution network
across Europe and large product offering (over 5 million SKUs),
which ensures product availability and fast delivery times,
together with numerous after-sales services resulting in high
customer retention, (3) more stable demand in the group's key
maintenance, repair and operations (MRO) segment (c.75% of group
sales), (4) fairly resilient margins historically and
profitability, which Moody's expects to improve over the next two
years as the operational issues at Brammer are addressed and
synergies from the IPH acquisition realised, (5) entrenched
relationship with a diverse base of customers (local to key
accounts) from different industries (e.g. general industry,
automotive, food, metals/steel, aerospace, packaging), (6)
adequate liquidity with forecast positive free cash flow
generation, and (7) an experienced management team with a strong
track record of growing the business and integrating numerous
acquisitions over the last decade.


If the refinancing is successful, Moody's considers the group's
liquidity as adequate for its near-term cash requirements.
Together with a relatively modest pro forma starting cash balance
of EUR10 million at transaction closing as of July 31, 2017,
projected funds from operations of more than EUR50 million per
annum are sufficient to cover the group's short-term cash uses.
Cash needs mainly comprise capital expenditures of about 1% of
group sales (EUR21 million in 2017), smaller deferred payments on
previous acquisitions as well as working capital spending.

The liquidity assessment also reflects access to funds under the
proposed new EUR135 million RCF, which is expected to be drawn by
around EUR44 million at transaction closing and utilized from
time to time to finance seasonal working capital swings (peak-to-
trough swings of more than EUR100 million throughout the year
assumed). The agency further notes that the group has a factoring
arrangement in place with maximum total funding of EUR200 million
to finance trade working capital requirements.

Moody's understands that there will be one springing covenant
negotiated in the new senior facilities agreement (senior secured
net leverage ratio) with ample initial headroom, which needs to
be tested if the RCF is drawn by more than 40%.


In Moody's loss-given-default (LGD) assessment, the group's
proposed new EUR765 million senior secured first lien term loan
and the EUR135 million senior secured RCF rank pari passu amongst
each other and share the same security interest and guarantees of
entities of the group representing at least 80% of consolidated
EBITDA. Given the weak collateral value of the security
(consisting mainly of share pledges, bank accounts, intercompany
receivables) in a potential default scenario, the new debt
instruments are modelled as unsecured in the LGD analysis.
Accordingly, these facilities rank first together with unsecured
trade payables, pension obligations and short term lease
commitments at the level of operating entities. The proposed
EUR187 million senior secured second lien term loan is guaranteed
on a senior subordinated basis and benefits from second-priority
pledges over the same assets as the first lien facilities.

Given the material amount of second-ranking debt, which serves as
loss absorption cushion in a theoretical case of default, the
senior facilities - first lien term loan and RCF - are rated
(P)B2, one notch above the (P)B3 CFR.

Moody's understands that the proposed financing of the IPH
acquisition further includes GBP140 million preferred equity,
issued at the level of AI Robin TopCo Ltd, will enter the
restricted financing group (top holding entity being AI Robin
Ltd) in the form of common equity. Accordingly, this instrument
is therefore excluded from the LGD assessment.


The stable outlook reflects Moody's view that the group's credit
profile and rating positioning will solidify over the next two
years, driven by improved margins and growth in adjusted EBITDA,
enabling it to reduce its Moody's-adjusted leverage towards 6.5x
debt/EBITDA by year-end 2018. The stable outlook further
recognizes the group's adequate liquidity position and expected
positive free cash flow generation in the range of EUR20-40
million per annum.


The ratings could be downgraded, if (1) the group failed to
constantly reduce its Moody's-adjusted leverage towards 6.5x
debt/EBITDA over the next two years, or (2) free cash flow turned
negative resulting in a deterioration of liquidity.

Moody's might consider an upgrade, if (1) Moody's-adjusted
debt/EBITDA declined sustainably below 6x, and (2) cash flow
generation improved with Moody's-adjusted RCF/debt ratios in
excess of 8% (RCF defined as retained cash flow).


The principal methodology used in these ratings was Distribution
& Supply Chain Services Industry published in December 2015.

AI Robin Limited, headquartered in London, United Kingdom, is a
leading European distributor of industrial maintenance, repair
and operations (MRO) products and related services. Products
offered include bearings, mechanical power transmission,
pneumatics, hydraulics, tools and health & safety equipment. The
group is active in a range of end-markets, including general
industry, automotive, metals & steel, aerospace, energy, food &
drink and transportation.

In the 12 months ended March 31, 2017, the combined group
generated net sales of more than EUR2.1 billion and company-
adjusted pro-forma EBITDA of around EUR143 million (before
synergies) in over 20 locations across Europe.

AI ROBIN: S&P Assigns Preliminary 'B' CCR, Outlook Stable
S&P Global Ratings said it has assigned its preliminary 'B' long-
term corporate credit rating to U.K.-based AI Robin Topco Ltd.
(AI Robin), the holding company that will own both IPH and
existing Advent International (Advent) portfolio company Brammer
PLC after the merger.  The outlook is stable.

S&P is also assigning its preliminary 'B' long-term corporate
credit ratings to the two subsidiaries, AI Robin Finco Ltd. and
AI Robin Ltd.

At the same time, S&P has assigned its preliminary 'B' issue-
level and '3' recovery ratings to financing entity AI Robin
Finco's proposed secured EUR765 million first-lien term loan,
maturing in 2024, and the proposed EUR135 million revolving
credit facility (RCF).  The '3' recovery rating reflects S&P's
expectation of meaningful recovery (50%-70%; rounded estimate:
50%) prospects in the event of a payment default.

The final ratings will depend on the successful completion of the
proposed transaction and receipt and satisfactory review of all
final transaction documentation.  Accordingly, the preliminary
ratings should not be construed as evidence of final ratings.  If
S&P Global Ratings does not receive final documentation within a
reasonable time frame, or if final documentation departs from
materials reviewed, S&P reserves the right to withdraw or revise
its ratings.  Potential changes include, but are not limited to,
use of loan proceeds, maturity, size and conditions of the loans,
financial and other covenants, security, and ranking.

AI Robin Topco is a holding entity set up for the acquisition of
the combined IPH and Brammer entity.  In February 2017, funds
advised by private equity firm Advent acquired U.K.-based
industrial supplies distributor Brammer PLC in a public to
private transaction for GBP221.5 million.  Advent is now in
exclusive negotiations to acquire IPH, the French industrial
supplies distributor, from PAI Partners, with the aim of
subsequently merging the two companies.  To finance the
acquisition, Advent plans to issue EUR900 million of senior
secured credit facilities via its finance subsidiary AI Robin
Finco.  The company will draw down a EUR765 million first-lien
term loan and EUR44 million of the proposed EUR135 million RCF to
fund this acquisition and repay existing RCF drawings.

Following the IPH and Brammer merger, the combined entity will
generate about EUR2.2 billion of revenues on a pro forma basis in
2017.  S&P believes the strategic rationale for the acquisition
is reasonable, given the benefits that it sees for the company's
business profile from the increased scale and geographic reach,
where swift availability and reliability is critical.

S&P thinks the business risk profile is being constrained by the
group's operations in a highly fragmented market.  While price
sensitivity is reasonably limited in critical situations where
down time and availability are the deciding factors, S&P expects
the group's client base to generally source their maintenance,
repair, and overhaul (MRO) parts in a proactive fashion and from
several vendors in order to ensure competitive pricing.  The
sector remains operationally demanding, requiring the efficient
management of millions of stock keeping units, and 20% of the
group's sales being subject to online competition.  Moreover,
there are no significant lead times or contracted volumes which
provide forward visibility so any decline in the top line usually
results in material margin declines as evidenced in previous
cycles.  S&P also sees some operational challenges surrounding
the merger, as well as some execution risk in the turnaround of

In S&P's opinion, these weaknesses are offset to some extent by
the group's diverse product range, including MRO parts used in
equipment for manufacture across many sectors, including pulp,
paper and packaging, aerospace, automotive, food and drink,
industrial machinery and metals, and several types of
construction.  Typical products are critical replacement parts to
production lines and include motors, bearings, and associated
products such as cutting tools and consumables.  S&P views
positively that approximately 74% of sales are to the aftermarket
given that this activity is less cyclical than the assembly of
new production equipment.  S&P also thinks that the qualitative
nature of the technical advice is a differentiating factor from
online competitors and, in S&P's view, could act as an effective
barrier to entry.  In addition, in a sector where customers
source from multiple vendors, the company has shown low customer
churn rates of 3%-4%.

S&P views AI Robin's financial risk profile as highly leveraged,
reflecting its aggressive financial policy and high debt burden
at about 8.5x pro forma S&P Global Ratings' adjusted debt to
EBITDA (at the close of transaction) and funds from operations
(FFO) cash interest coverage of above 4.0x.  However, S&P
anticipates that the company will continue to generate
predictable free operating cash flow (FOCF) and maintain adequate
liquidity while balancing its growth objectives.

Adjusted debt at closing is expected to stand at EUR1.3 billion,
including on balance sheet debt of about EUR980 million, plus
adjustments of close to EUR365 million relating to the group's
outstanding factoring lines, operating lease commitments, and
unfunded pension obligations.

S&P's base-case scenario includes:

   -- Eurozone real GDP growth to fluctuate at about 1.5% for the
      foreseeable future, while inflation rates should recover
      toward 1.5% in 2017 and 2018.

   -- About EUR2.2 billion in revenues on a pro forma basis in
      2017.  S&P forecasts total revenue growth of about 4%
      (including about 1% organically), largely driven by IPH's
      favorable market position in France and bolt-on
      acquisitions.  Reported EBITDA margins (before
      restructuring expenses) gradually improving to about 8% in
      financial year (FY) 2018 and FY 2019 (EUR180 million-EUR190
      million per year on an absolute basis), reflecting the
      achievement of material synergies related to procurement
      savings, selling, general, and administrative cost
      efficiencies, and reduced overheads.  S&P thinks that under
      private ownership, Brammer's margins will improve
      substantially as the group has identified several
      initiatives to shift the company's focus toward cost

   -- Capital expenditure (capex) of about EUR21 million in 2017,
      followed by annual average capex of about EUR20 million-
      EUR25 million in 2018-2019.

   -- No major acquisitions in 2017 as the group will go through
      a transition period focusing on the integration of IPH and
      Brammer.  For 2018 and 2019, S&P forecasts some small bolt-
      on acquisition spending of EUR15 million-EUR20 million per

As S&P considers 2017 to be a transitional year marked by the
integration of IPH and Brammer, S&P's analysis will be focusing
on the metrics for 2018 and 2019.

Based on these assumptions, S&P arrives at these credit measures
for the combined entity under the proposed new capital structure:

   -- S&P Global Ratings-adjusted debt to EBITDA of about 7.0x in
      2018 and about 6.0x in 2019.

   -- Adjusted FFO-to-debt ratio of 8%-10% in 2018 and 2019.

   -- FOCF generation of EUR30 million-EUR50 million in 2018.

The stable outlook reflects S&P's view that the company will
benefit from fairly benign market growth that, combined with the
expectation of synergies arising from the IPH and Brammer merger,
will allow the company to post an EBITDA margin of about 8% and
support modest deleveraging to about 7x in 2018.  S&P also
expects the combined entity to maintain FOCF generation at more
than EUR30 million per year.  S&P considers either an upgrade or
downgrade highly unlikely in the short-term, and that 2017 is
essentially a transition year, given the need to embed and
realize the benefits from the merger.

S&P considers a downgrade to be unlikely in the short-term, given
relatively stable revenues and the opportunities for synergies.
Nevertheless, S&P could lower the ratings in the next 12 months
if there is a material shortfall in the achievement of synergies,
leading to weaker-than-projected EBITDA and margin improvement,
higher leverage, and deterioration in the expected cash position.
This could be reflected by free cash flow falling below EUR20
million per year.

S&P could raise the ratings if the combined entity performed
materially above projections in terms of cost synergies and
underlying margins, and deleveraged to below adjusted total debt
to EBITDA of 5.0x, while maintaining strong cash generation.  S&P
expects the group to continue its bolt-on acquisition strategy
and potential further transformational acquisitions beyond FY
2018 and therefore consider the likelihood of leverage reducing
below 5.0x less likely.

CO-OPERATIVE BANK: Halts Sale Process, Nears Rescue Plan
Jon Yeomans at The Telegraph reports that the Co-op Bank has said
it is no longer up for sale as it hopes a rescue plan with its
hedge fund owners is near.

The troubled lender, which has previously said that it needs an
injection of GBP750 million to plug a capital shortfall, put
itself up for sale in February as it sought to avoid being wound
down by the regulator, The Telegraph relates

In an update on its discussions with its owners, the bank, as
cited by The Telegraph, said: "Given the advanced nature of the
proposal [to rescue the bank], the board has decided to
discontinue the formal sale process under the Takeover Code. The
bank is, therefore, no longer in an 'offer period' for the
purposes of the Takeover Code."

The Co-op Bank added that "a majority of the key commercial
aspects of the proposal have been substantially agreed between
the bank and the investors" and that a further announcement would
be made in due course, The Telegraph notes.

According to The Telegraph, the lender said that the rescue plan
would enable it to continue as a stand-alone entity and
"safeguard the Bank's values and ethics".

                   About Co-operative Bank

The Co-operative Bank plc is a retail and commercial bank in the
United Kingdom, with its headquarters in Balloon Street,

In 2013-2014, the Bank was the subject of a rescue plan to
address a capital shortfall of about GBP1.9 billion.  The Bank
mostly raised equity to cover the shortfall from hedge funds.

In February 2017, the Bank's board announced that they were
commencing a sale process for the Bank and were "inviting

The Troubled Company Reporter-Europe reported on February 17,
2017 that Moody's Investors Service downgraded Co-operative Bank
plc's standalone baseline credit assessment (BCA) to ca from
caa2.  The downgrade of the bank's BCA to ca reflects Moody's
view that the bank's standalone creditworthiness is increasingly
challenged and that the bank will not be able to restore its
declining capital position without external assistance.

TCR-Europe also reported on February 23, 2017 that Fitch Ratings
has downgraded The Co-operative Bank p.l.c.'s (Co-op Bank) Long-
Term Issuer Default Rating (IDR) to 'B-' from 'B' and placed it
on Rating Watch Evolving (RWE).  The Viability Rating (VR) was
downgraded to 'cc' from 'b'.  The downgrade of the VR reflects
Fitch's view that a failure of the bank appears probable as it
likely needs to obtain new equity capital to restore viability.
Fitch believes there is a very high risk that this will include a
restructuring of its subordinated debt that Fitch is likely to
consider a distressed debt exchange, which would result in a
failure according to Fitch definitions.  However, the bank had
originally hoped to strike a deal by mid-June, in order to
complete the debt-for-equity swap process before GBP400 million
of senior bonds mature in September, the FT states.

The Co-op Bank said it was still pursuing an attempt to sell the
entire lender at the same time as advancing talks with existing
investors to raise capital, the FT relays.

KIRS MIDCO 3: Moody's Assigns Definitive B3 CFR, Outlook Positive
Moody's Investors Service has assigned a definitive Corporate
Family Rating (CFR) of B3 and a probability of default rating
(PDR) of B3-PD to KIRS Midco 3 plc, an intermediate holding
company of the new KIRS group (KIRS) and a subsidiary of KIRS
Group Limited. Moody's has also assigned a Ba3 rating to the
GBP90 million backed super senior secured revolving credit
facility (RCF) and a B3 rating to the GBP400 million and USD520
million backed senior secured bonds, which were issued by KIRS
Midco 3 plc. The outlook on KIRS Midco 3 plc is positive.
Concurrently, Moody's withdrew the B3 CFR on KIRS Finco Plc.

The definitive ratings are in line with the provisional ratings
assigned May 26, 2017, and reflect (1) the combination of KIRS
Finco plc, the parent company of Towergate, with Nevada
Investments Topco Limited (Nevada) completed on June 23, 2017;
and (2) the group's successful bond issuance completed on June 6,
2017, with the final terms and conditions of the facilities in
line with Moody's expectations.


The B3 CFR on KIRS reflects the new group's strong business
profile and product diversification together with good EBITDA
margins and earnings growth prospects. The rating is constrained
by the high level of debt and Moody's expectation of moderate net
cash flows over the coming 12-18 months, as a result of
significant near-term exceptional cash outflows and material
interest costs.

The B3-PD PDR rating is in line with the CFR. Moody's Ba3 rating
on the GBP90 million super senior secured RCF is 3 notches above
the B3 senior secured debt rating, reflecting the RCF's priority
over enforcement proceeds. The RCF and debt ratings also
incorporate Moody's view of the value of the notes' secured
status over certain material assets of the group and the benefit
from upstream guarantees.


Moody's says the following factors could lead to a ratings
upgrade on KIRS: (1) positive Free Cash Flows % Debt consistently
above 3%; (2) gross debt-to-EBITDA below 6.5x with EBITDA-CAPEX
coverage of interest sustainably above 2.0x; and (3) Moody's
adjusted EBITDA surpassing GBP125 million with EBITDA margins
above 25%.

Whilst unlikely given the positive outlook, the following factors
could lead to a downgrade on KIRS: (1) adjusted gross debt-to-
EBITDA remaining above 8.0x; (2) a weakening in the group's
liquidity position or cash flows generation; and/or (3) EBITDA
before exceptional items, excluding run-rate cost savings below
GBP100 million with EBITDA margins below 23%.


Moody's has assigned the following ratings on KIRS Midco 3 plc:

--- Corporate Family Rating at B3

--- Probability of Default Rating at B3-PD

--- GBP400 million and USD520 million Backed Senior Secured Debt
Ratings at B3

--- GBP90 million Backed Super Senior Secured Debt Rating at Ba3

The outlook for KIRS Midco 3 plc is positive.

Moody's withdrew the following ratings on KIRS Finco plc:

--- Corporate Family Rating previously rated B3

--- Probability of Default Rating previously rated B3-PD

--- GBP425 million Backed Senior Secured Debt Rating previously
rated B3

--- GBP75 million Backed Senior Secured Debt Rating previously
rated Ba3

The positive outlook on KIRS Finco plc has been withdrawn.

For 12 months to December 31, 2016, KIRS' pro-forma total revenue
amounted to GBP491 million and adjusted EBITDA to GBP134 million.
For the same period, Towergate reported total revenues of GBP319
million and adjusted EBITDA of GBP52 million.


The principal methodology used in these ratings was Insurance
Brokers and Service Companies published in December 2015.

KIRS MIDCO: Fitch Assigns B- Long-Term IDR, Outlook Positive
Fitch Ratings has assigned KIRS Midco 3 plc (KIRS Group) a final
'B-' Long-Term Issuer Default Rating (IDR) with a Positive
Outlook. KIRS Group, the UK's leading diversified independent
insurance intermediary, has been formed by combining the
businesses of Towergate (KIRS Finco plc), with Direct Group,
Price Forbes, Chase Templeton and Autonet. Simultaneously, Fitch
has affirmed KIRS Finco plc's IDR at 'B-' with Stable Outlook and
withdrawn the rating as its debt has been repaid.

The rating is constrained by a mature UK insurance market,
negative 2017 free cash flow (FCF) and execution risk related to
the expected full delivery of the Towergate transformation plan.
The rating is supported by the enhanced market position and
product diversity of the combined group, improved liquidity and
strong shareholder support.


Mature UK Market May Moderate Growth: Fitch believes the
management team has demonstrated the knowledge and skillset to
execute the Towergate transformation plan. However, risks remain
in delivering this plan in a highly competitive insurance and
brokerage market. The UK non-life insurance broker market is
likely to experience limited organic growth over the next four
years. In addition, KIRS Group may not be able to continue to
attract or retain the skilled employees required to realise these
plans or the employees may not deliver as expected. However, this
is offset by significantly reduced employee turnover and new
revenue-focused hires. There is also potential for disruption
from digital technology and disintermediation, which is partly
offset through the acquisition of Autonet and KIRS Group's
multiple distribution channels.

Acquisition Adds Scale and Diversity: The proposed transaction
will enhance the scale and diversity of the legacy Towergate
business and reinforce its position as the leading diversified
independent insurance intermediary in the UK. This will allow
KIRS Group to leverage multiple distribution channels to access
each of its customer segments with a broad product portfolio. In
addition, with a product portfolio targeting segments such as
SME, automotive, and health insurance, there is the potential to
reduce earnings volatility and through a more integrated
approach, to capture a greater proportion of potential revenue.

Leverage and FCF Show Positive Trend: The transaction will
materially deleverage the group from the historical Towergate
capital structure. In particular, funds from operations (FFO)
adjusted gross leverage is likely to decline to 7.6x for KIRS
Group in 2017 from over 9.0x for Towergate in 2016. Operational
improvements and the delivery of the transformation plan will
lead to deleveraging, sales growth and FCF improvement. However,
KIRS Group's FCF is expected to remain negative in 2017, before
trending towards positive territory by 2018. Liquidity risk from
negative FCF is mitigated by on balance sheet cash and the
addition of a GBP90 million super senior revolving credit
facility (RCF).

Transformation Programme Has Stabilised Towergate: KIRS Group's
Towergate subsidiary has been going through restructuring for the
past two years and it has utilised a transformation plan to
deliver operational and financial improvements. Towergate has
made significant progress on the transformation plan, exceptional
items remain and the full annualised benefits will not be
realised until 2018 or later. However, it is Fitch views that
substantially all of the expense components of the plan have been
completed and that management can dedicate increasing resources
to developing the strategy around KIRS Group.

Support from Shareholders and Regulators Key: Shareholders have
invested approximately GBP680 million in KIRS Group and have
demonstrated their support both through transactions to provide
liquidity to Towergate during the transformation plan and by
financing the acquisitions to form KIRS Group. Continued
shareholder support is a positive factor for the group. In
addition, given that Towergate is regulated by the FCA, it is
credit-positive that the FCA has been involved from the outset of
the process and remains supportive of the proposed new group.
This is an essential component of delivering the proposed


KIRS Group has a significantly smaller scale than its insurance
broker peers rated by Fitch and has a less diverse product line.
Its expertise in niche, high margin product lines and its leading
position among UK insurance brokers underpin a sustainable
business model, but its higher financial risk and underperforming
business lines constrain the rating.


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

- Sales grow at 2% in 2017 trending towards 6%-7% in 2019-2020;
- EBITDA margins grow from 22.4% in 2017 to approximately 29% in
- Capex includes maintenance of 2% per year and growth capex of
   GBP60 million in total;
- Exceptional items include regulatory fees and expenses as well
   as costs related to the transformation plan.


- The post-restructuring EBITDA is 10% below Fitch's 2017
   forecast EBITDA. This reflects a hypothetical contraction
   which would provoke a default as well as Fitch's expectation
   of corrective actions.
- 5.5x distressed multiple reflects KIRS Group's strong market
   position and diversified business profile.
- 10% of going concern enterprise value is deducted for
   administrative claims.
- RCF is assumed to be fully drawn upon default. The RCF is
   super senior to the senior secured notes.


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

- FFO gross adjusted leverage below 6.5x.
- FFO fixed charge coverage above 2.5x.
- EBITDA margins sustainably above 25% and trending towards 30%.
- Successful integration of KIRS Group.

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

- FFO gross adjusted leverage above 8x;
- Persistently negative FCF with FFO fixed charge coverage below
- Failure of the transformation plan to deliver expected savings
   with EBITDA margins below 20%;
- Total liquidity below GBP20 million;
- Evidence that shareholders no longer support the business.


RCF Provides Sustainable Liquidity: The transaction will result
in GBP42 million on-balance sheet cash. In addition, KIRS Group
will have a GBP90 million RCF and no near-term maturities. Fitch
expects this to be sufficient to cover negative FCF in 2017
related to the delivery of the transformation plan and other
business investments. Fitch expects positive FCF from 2018 to


KIRS Midco 3 plc
-- Long-Term IDR assigned at 'B-'; Outlook Positive
-- Super senior RCF assigned 'BB-'/'RR1'
-- Senior secured notes assigned 'B'/'RR3'

KIRS Finco plc
-- Long-Term IDR affirmed at 'B-'; Outlook Stable and withdrawn
-- Super senior notes affirmed at 'BB-'/'RR1' and withdrawn
-- Senior secured notes affirmed at 'B-'/'RR4' and withdrawn

MOY PARK: S&P Maintains 'B+' CCR on CreditWatch Negative
S&P Global Ratings said that it maintained its 'B+' corporate
credit and issue ratings on Moy Park Holdings Europe on
CreditWatch with negative implications.

The ratings were placed on CreditWatch on May 22, 2017.

S&P's revision of Moy Park's status within the group to non-
strategic from strategically important follows its parent JBS'
announcement of a divestment program aimed at raising Brazilian
real (BRL) 6 billion to reduce its financial leverage.  This
program entails disposing of non-core and less strategic assets
within the group, including minority interests in Vigor
Alimentos, Five Rivers Cattle Feeding assets and farms, and its
shareholding interest in Moy Park.

Based on the decision taken by the parent group, JBS, S&P no
longer view Moy Park as satisfying the requirements for a
strategically important assessment.  These previously included
S&P's view that the company was unlikely to be sold, had the
long-term commitment of senior management, and was a part of the
long-term strategy.

The final rating on Moy Park is not affected by S&P's assessment
revision as it is still capped by the rating on parent JBS.
Additionally, S&P maintains its assessment of the group's stand-
alone credit profile at 'bb', reflecting the weak business risk
and intermediate financial risk profiles.


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

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

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


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

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

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Joseph Cardillo at

                 * * * End of Transmission * * *