TCREUR_Public/170811.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

           Friday, August 11, 2017, Vol. 18, No. 159



BELARUSIAN REPUBLICAN: Fitch Affirms B- IFS Rating, Outlook Pos.


TRIONISTA TOPCO: S&P Places 'B+/B' CCR on CreditWatch Positive
ZF FRIEDRICHSHAFEN: Moody's Affirms Ba1 CFR, Outlook Positive


GAS NATURAL: Moody's Affirms Ba1 Junior Subordinated Debt Rating
PANGAEA ABS 2007-1: Fitch Raises Rating on Class C Notes to 'BB'
ROYAL KPN: Fitch Affirms BB+ Sub. Capital Securities Rating
WOOD STREET 1: Moody's Affirms Ba3 Rating on Class E Notes
WP/AV CH HOLDINGS: S&P Assigns 'B' Long-Term CCR, Outlook Stable

* NETHERLANDS: Number of Corporate Bankruptcies Down in July


CYFROWY POLSAT: Moody's Revises Outlook to Pos., Affirms Ba2 CFR


ANELIK RU: Bank of Russia Revokes Banking License
BANK RESERV: Put On Provisional Administration, License Revoked
KONTINENT FINANS: Put On Provisional Administration
VSK INSURANCE: Fitch Affirms BB- IFS Rating, Outlook Stable

U N I T E D   K I N G D O M

LEHMAN BROTHERS: UK Administrator Warns of Financial Crisis
REDX PHARMA: Joint Administrators Mull Options for Business


* BOOK REVIEW: The Money Wars



BELARUSIAN REPUBLICAN: Fitch Affirms B- IFS Rating, Outlook Pos.
Fitch Ratings has revised the Outlooks on three state-owned
Belarus insurers to Positive from Stable while affirming the
Insurer Financial Strength (IFS) Ratings at 'B-'. The affected
insurers are Belarusian Republican Unitary Insurance Company
(Belgosstrakh), Belarusian National Reinsurance Organisation
(Belarus Re), Export-Import Insurance Company of the Republic of
Belarus (Eximgarant).

The revision of the Outlook to Positive on the IFS Ratings
follows a similar action on Belarus's sovereign Long-Term Local
Currency Issuer Default Rating (IDR) on July 28, 2017, which was
affirmed at 'B-'.

The ratings continue to reflect the insurers' 100% state
ownership and capital support from the state when needed. In
addition, the ratings reflect the leading market positions of the
insurers in their respective segments, their sustainable profit
generation and the fairly low quality of their investment

The ratings of Belgosstrakh and of Eximgarant also benefit from
state guarantees for insurance liabilities under compulsory

A change in Belarus's Long-Term Local Currency IDR is likely to
lead to a corresponding change in the insurers' IFS Ratings.

A significant change in the insurers' relationship with the
government would also likely affect the insurers' ratings.


TRIONISTA TOPCO: S&P Places 'B+/B' CCR on CreditWatch Positive
S&P Global Ratings placed its 'B+/B' long- and short-term term
corporate credit ratings on Germany-based energy service provider
Trionista TopCo GmbH (ista), a subsidiary of ista Luxemburg GmbH
Sarl, on CreditWatch with positive implications.

S&P said, "At the same time, we placed our 'BB-' issue ratings on
Trionista HoldCo's EUR1,114 million senior secured term loan B,
EUR150 million revolving credit facility (RCF), and EUR350
million senior secured notes on CreditWatch positive. Our
recovery rating on these instruments remains at '2', indicating
our expectation of substantial recovery prospects (70%-90%;
rounded estimate 70%) in the event of payment default.

"We also placed on CreditWatch positive our 'B-' issue rating on
ista's subordinated notes. The recovery rating remains at '6',
indicating our expectation of negligible (0%-10%; rounded
estimate 0) recovery.

"The CreditWatch placement follows the proposed acquisition of
ista Luxemburg by Hong Kong-based property developer Cheung Kong
Property Holdings Ltd. (CKPH) and investment-holding company CK
Infrastructure Holdings Ltd. (CKI), which is majority-owned by CK
Hutchison Holdings Ltd., from CVC Capital Partners. CKPH and CKI
proposed to acquire 65% and 35% stakes in ista Luxemburg,
respectively, through a new joint venture. The transaction is
subject to regulatory approvals, which we expect in the fourth
quarter of 2017.

"We assume that ista's credit profile may benefit from the
acquisition by the two financially stronger entities. We would
need to assess ista's strategic importance for CKPH and CKI to
evaluate ista's credit quality following the transaction.

"The documentation for ista's senior loans contains a change-of-
control clause that will come into effect if the company is
acquired by a new shareholder. We currently have no information
on the company's post-acquisition capital structure. However, if
the change-of-control clause is triggered, we assume that the new
shareholders would manage the refinancing in a timely manner.

"We expect to resolve the CreditWatch at the close of the
transaction, which we understand is likely to occur in the fourth
quarter of 2017. At that time, we would assess any changes to
ista's capital structure and the impact from the two financially
stronger parents."

ZF FRIEDRICHSHAFEN: Moody's Affirms Ba1 CFR, Outlook Positive
Moody's Investors Service has affirmed the ratings pertaining to
German automotive supplier -- ZF Friedrichshafen AG (ZF).
Specifically, Moody's has affirmed the Ba1 corporate family
rating (CFR) and the Ba1-PD probability of default rating (PDR).
Concurrently, Moody's has affirmed the Ba1 senior unsecured
ratings relating to the notes issued by both ZF North America
Capital, Inc. and TRW Automotive Inc. The outlook on the ratings
remains positive.

The following ratings are affected:


Issuer: ZF Friedrichshafen AG

-- Corporate Family Rating, Affirmed Ba1

-- Probability of Default Rating, Affirmed Ba1-PD

Issuer: ZF North America Capital, Inc.

-- Backed Senior Unsecured Regular Bond/Debenture, Affirmed Ba1

Issuer: TRW Automotive Inc.

-- Senior Unsecured Regular Bond/Debenture, Affirmed Ba1

Outlook Actions:

Issuer: ZF Friedrichshafen AG

-- Outlook, Remains Positive

Issuer: ZF North America Capital, Inc.

-- Outlook, Remains Positive

Issuer: TRW Automotive Inc.

-- Outlook, Remains Positive


The affirmation of ZF's ratings reflects the progress the group
has made over the last twelve months in growing both revenue and
profitability and reducing debt. Following the publication of the
group's H1-2017 financial results, the rating agency estimates
that the company's key credit metrics are now modestly exceeding
Moody's expectations for the current rating. On a last-twelve-
months (LTM) basis, Moody's estimates leverage (debt / EBITDA,
adjusted by Moody's) to be around 2.9x (vs. expectations of 3x),
profitability (EBITA margin, adjusted by Moody's) to be around
7.5% (vs. expectations of 7%) and retained cash flow (RCF) / net
debt of 30% (vs. expectations of 25%). Nevertheless, Moody's
notes that an upgrade to Baa3 at the current time would render
the ratings somewhat weakly positioned with minimal headroom. As
a result the higher rating would have very limited capacity to
absorb a deterioration in credit metrics e.g., resulting from a
softening in global automotive production or a loosening of
financial policy. However, if ZF is able to sustain and indeed
improve current metrics over the next 6-9 months the rating
agency believes an upgrade of its ratings is very likely.

The Ba1 ratings reflect as positives the company's: (1) leading
market position as one of the largest Tier 1 global automotive
suppliers combined with its sizeable industry-facing operations;
(2) ongoing integration with TRW which increases the group's
scale, product offering, technology and both regional and
customer diversification; (3) a clear focus on innovation and new
product development; (4) positive strategic alignment to address
the disruptive trends of automotive electrification and
autonomous driving; (5) conservative financial policy as
reflected in relatively limited dividend payments, which
emphasizes debt reduction and cash flow generation; and (6) a
good liquidity profile.

The ratings also reflect as negatives the company's: (1) still
elevated leverage with debt / EBITDA (as measured by Moody's) of
2.9x at the end of H1-2017, taking into account the fact that the
automotive industry is at its or very close to its peak; (2)
modest operating profitability with EBITA margins of 7.5% albeit
in-line with the industry average; (3) continued high capital and
R&D expenditure reflecting the group's focus on innovation; and
(4) residual challenges to integrate TRW albeit which are
expected to conclude by the end of 2017.


The positive outlook incorporates Moody's expectations that ZF
will continue its conservative financial policy, smoothly
integrate TRW and will build on the solid performance that the
combined group has shown since closure of the transaction in May
2015. Moody's expects a further gradual but steady strengthening
of ZF's credit quality and could see the rating moving into
investment grade territory over the next 6-9 months.


Absent a deterioration in key credit metrics, Moody's would
anticipate a ratings upgrade within the next 6-9 months. An
upgrade would be conditional on ZF maintaining EBITA margins
above 7%, debt / EBITDA below 3x, RCF / net debt above 25% and
FCF above EUR500 million. Downward pressure would result from any
execution issues relating to TRW or a weakening of key credit
metrics. Specifically, EBITA margins falling below 6.0%, leverage
sustainably above 3.5x debt / EBITDA or a weakening in FCF
generation to below EUR500 million could trigger a negative
rating action.

The principal methodology used in these ratings was Global
Automotive Supplier Industry published in June 2016.

ZF Friedrichshafen AG (ZF), headquartered in Friedrichshafen,
Germany, is a leading global automotive technology company
specialised on driveline and chassis technology as well as active
and passive safety technology. The company, which completed the
acquisition of TRW Automotive in May 2015, generates the majority
of its revenues within the passenger car and commercial vehicle
industries, but also delivers to other markets including the
construction and agricultural machinery sector. Following the
acquisition of TRW, ZF is one of the largest automotive suppliers
on a global scale with revenues of EUR35 billion (2016), having a
similar size as Bosch, Denso and Magna.


GAS NATURAL: Moody's Affirms Ba1 Junior Subordinated Debt Rating
Moody's Investors Service has affirmed the Baa2/P-2 senior
unsecured issuer ratings of Gas Natural SDG, S.A. and the ratings
of its guaranteed subsidiaries. Concurrently, Moody's has
affirmed the (P)Baa2/Baa2/Prime-2 ratings of Gas Natural Fenosa
Finance B.V., as well as the Baa2 and (P)Baa2 ratings of Gas
Natural Capital Markets, S.A.. The Ba1 junior subordinated
(hybrid) rating of Gas Natural Fenosa Finance B.V. was also
affirmed. The outlook remains stable.

The affirmations follow GNF's announcement on 3 August that it
will sell a 20% stake in its Spanish gas distribution subsidiary,
GNDB, to Alliance Capital Partners, (ACP) and Canada Pension Plan
Investment Board (CPPIB) for EUR1.5 billion.


The rating actions reflect Moody's expectation that (1) while a
sale of a stake in GNF's low risk Spanish gas distribution assets
and the introduction of new minority shareholders is modestly
credit negative, this is likely to be mitigated by GNF's balanced
financial policy. The company has announced that it will dedicate
the bulk of the transaction proceeds to existing projects, which
should generate additional cash flows to support its financial
profile, while any surplus will be applied to new investments,
debt reduction or returned to shareholders; and (2) the
transaction will not materially change the risk profile of GNF,
which will continue to generate around 60% of its EBITDA from
network activities and around 50% of EBITDA from Spain, although
these contributions could weaken modestly on a pro-rata basis (by
around 2%) taking into account minority interests.

GNF's ratings continue to reflect (1) a high proportion of EBITDA
from lower risk contracted and regulated businesses across a
well-diversified portfolio of assets, primarily in Spain and
Latin America (LatAm); and (2) higher risk international gas
procurement and supply and Spanish electricity generation
activities, which remain subject to oversupply and a challenging
commodity and power price environment. The ratings also take
account of an improving, but still fragile, macroeconomic
situation in Spain (Baa2, stable).

Moody's expects GNF to update its 2016-20 strategic plan in 2018
which will include further efficiencies and a reduction in
interest costs to counteract some of the negative pressures
presented by the challenging operating environment.

The sale price of EUR1.5 billion for 20% of GNF's gas
distribution subsidiary, (GNDB), implies an enterprise value (EV)
of EUR13.94 billion for 100% of a company that generated EBITDA
of EUR889 million as at financial year end 2016. This yields an
attractive EV/EBITDA multiple of 15.7x, in line with recent
transactions for similarly low risk, well regulated network
assets. EDP - Energias de Portugal, S.A. (EDP, Baa3 stable)
agreed a sale of its Spanish distribution assets, Naturgas
Energia Distribucion, S.A.U. (Naturgas), to a consortium of
institutional investors in March 2017 at an 15.7x EV/EBITDA
multiple and its gas distribution business in Portugal in April
2017 to REN - Redes Energeticas Nacionais, SGPS, S.A. (REN, Baa3
stable) at an 11x EV/EBITDA multiple.

As part of the arrangement, GNF will put in place long term
intercompany debt of EUR6 billion at GNDB, which will continue to
be consolidated within the GNF group According to GNF's new
partners, ACP and CPPIB, the acquisition is in line with their
core infrastructure investment strategies.


The outlook is stable reflecting Moody's expectations of
financial ratios consistent with guidance for the Baa2 rating of
Funds from Operations (FFO)/net debt of high teens to low
twenties in percentage terms, and Retained Cash Flow (RCF)/net
debt which, while it is expected to dip in 2017, should recover
towards the low teens by 2020.


Positive ratings pressure is not currently anticipated but could
develop if GNF maintains a stable business profile and
strengthens its financial position, achieving sustainable credit
metrics of FFO/net debt comfortably in the twenties in percentage
terms and RCF/net debt in the upper teens.

GNF currently has limited headroom against ratio guidance for the
Baa2 rating and negative pressure could develop following any (1)
deterioration in financial performance, or unanticipated growth
activity through organic change or acquisitions, likely to cause
credit metrics to fall persistently below guidance; or (2) an
increase in business, regulatory or political risk within core
markets or credit negative change in corporate structure, such as
through an introduction of increasingly material minority
interests, which would argue for a tightening of metric guidance.

The principal methodology used in these ratings was Unregulated
Utilities and Unregulated Power Companies published in May 2017.

Gas Natural SDG, S.A. is one of the three major players in the
Iberian power and gas markets. It ranks as the leading gas supply
company and third in power generation. As of December 2016 it has
15.5 GW of installed capacity worldwide, with 7.8 million gas
connections and 3.6 million electricity connections in LatAm and
is the leading gas distributor in LatAm. The group is one of the
main suppliers of natural gas in the Atlantic and Mediterranean,
with a long-term gas procurement portfolio of approximately 30
bcm. In addition, it has three regasification and two
liquefaction plants.



Issuer: Gas Natural Capital Markets, S.A.

-- Backed Senior Unsecured MTN Program, Affirmed (P)Baa2

-- Backed Senior Unsecured Regular Bond/Debenture, Affirmed Baa2

Issuer: Gas Natural Fenosa Finance B.V.

-- Backed Junior Subordinated, Affirmed Ba1

-- Backed Commercial Paper, Affirmed P-2

-- Backed Senior Unsecured MTN Program, Affirmed (P)Baa2

-- Backed Senior Unsecured Regular Bond/Debenture, Affirmed Baa2

Issuer: Gas Natural SDG, S.A.

-- LT Issuer Rating, Affirmed Baa2

-- ST Issuer Rating, Affirmed P-2

Outlook Actions:

Issuer: Gas Natural SDG, S.A.

-- Outlook, Remains Stable

Issuer: Gas Natural Capital Markets, S.A.

-- Outlook, Remains Stable

Issuer: Gas Natural Fenosa Finance B.V.

-- Outlook, Remains Stable

PANGAEA ABS 2007-1: Fitch Raises Rating on Class C Notes to 'BB'
Fitch Ratings has upgraded Pangaea ABS 2007-1 B.V. as follows:

Class A: upgraded to 'BBBsf' from 'BBsf'; Outlook Positive
Class B: upgraded to 'BBBsf' from 'Bsf'; Outlook Stable
Class C: upgraded to 'BBsf' from 'CCCsf' Outlook Stable
Class D: affirmed at 'Csf'
Class E: affirmed at 'Csf'
Class F: affirmed at 'Csf'
Class S1: affirmed at 'Csf'

The transaction is a managed cash securitisation of structured
finance assets, primarily mortgage-backed securities. The
portfolio is actively managed by Investec Principal Finance.


The upgrades reflect the increase in credit enhancement for the
class A, B and C notes due to the amortisation of the class A
notes and an improvement in the credit quality of the performing
portfolio. The class A notes have paid down EUR31.6 million since
Fitch last reviews leaving 10.2% of the initial balance. Credit
enhancement for the class A notes has increased to 73.3% from
53.4% at last review, for the class B notes to 53.4% from 40.3%
and for the class C notes to 31.0% from 24.3%.

Credit quality in the performing portfolio has also improved,
with the weighted average rating factor decreasing to 18.6 from
27.7. Total defaulted assets are EUR43.8 million, slightly up
from EUR42.3 million last year.

The transaction is becoming more concentrated as the portfolio
amortises. The number of issuers in the performing portfolio has
decreased to 30 from 43 and the number of assets to 32 from 46.
This has been offset by increased credit enhancement and improved
credit quality.

All overcollateralisation tests have been breached since 2008,
leading to a diversion of excess spread and deferral of interest
on the class D, E and F notes. The class C overcollateralisation
test ratio has been improving, increasing by 1.78% since Fitch
last reviews. It is currently 0.74% under the trigger level of
110% according to the June 2017 investor report. If the test were
to cure, interest would cease to be diverted from the class D
notes. The reinvestment period ended in June 2013 and the
transaction documents currently prevent the manager from
reinvesting principal proceeds.

The class S-1 combination notes' rating reflects the rating of
the class D component class.


Given the increased concentration in the transaction and the
increased proportion of RMBS assets in the portfolio (61.2% of
the performing portfolio), Fitch ran a sensitivity assuming that
non-amortising RMBS assets paid in full at their legal final
maturity date. This resulted in model best pass ratings four
notches lower for the class A notes, one category lower for the
class B notes and one notch lower for the class C notes.

ROYAL KPN: Fitch Affirms BB+ Sub. Capital Securities Rating
Fitch Ratings has affirmed Netherlands-based Royal KPN N.V.'s
(KPN) Long-Term Issuer Default Rating (IDR) and senior unsecured
rating at 'BBB'. The Outlook on the IDR is Stable.

KPN's rating reflects its leading position in the Dutch telecoms
market. Competitive dynamics in the mobile and business segments
are likely to remain challenging over the medium-term, but the
combination of cost savings and modest growth in the consumer
segment are likely to offset declines and drive a sustainable
stabilisation in EBITDA and free cash-flow growth. KPN has to
date maintained financial flexibility through sizeable financial
investments and using proceeds from asset sales to improve
leverage as well as equity returns. The flexibility provides KPN
with sufficient scope to manage operational risks and is a core
element in its credit profile and rating.


Rational Fixed Market Structure: KPN generates about 30% of its
revenues and probably a higher proportion of profits from the
consumer fixed-line segment. Fitch estimates that around 80% of
the total Dutch market by revenues is generated broadly equally
by KPN and VodafoneZiggo. This creates an effective duopoly in
local fixed access and a structurally supportive environment.
Given the maturity of the Dutch broadband market, Fitch expects
the market structure to instil rationality in the consumer
broadband and fixed-line segments. KPN's early commercial
agreements to allow wholesale access to its fibre (VULA) also
limit the risk from increasing competition from virtual

Sustainable Consumer Position: KPN's strategy to invest in
broadband networks, value-added bundled products and service
quality should enable the company to compete more effectively and
sustainably in the consumer market. The strategy provides some
points of differentiation in less price sensitive segments of the
market and enables KPN to plough back savings from reduced churn
into customer retention and product improvement. KPN's household
penetration of fixed-mobile bundles has increased to 40% (1H17)
from 33% (1H16), while mobile subscriber acquisition and
retention costs have improved on per subscriber basis during

Business Sector Decline to Persist: Fitch expects KPN's revenue
declines from the business segment to continue into the medium
term, but expect the rate of annual decline (9% 2015, 7% 2016 and
6% 1H17) to continue improving. The declines are driven by a
repricing of single-play mobile services, loss of traditional
fixed-line voice revenues, migration to IP based products, and
competition. Visibility on the point of inflection, when new
services, multi-play growth and solutions offset the declines
remains low. This is reflected in Fitch base-case forecasts
discussed below.

Mobile Market Pressure May Increase: The entry of Tele2 as a
mobile network operator has so far had minimal impact on KPN as
result of its segment focus and bundled strategy. This
however may begin to change over the next 12 to 24 months as
Tele2 seeks to increase scale and T-Mobile Netherlands looks to
improve its financial performance. Fitch is not confident about
the long-term viability of Tele2's business model in its current
form and are concerned that this may lead to less rational
behaviour as the operator seeks to cover fixed costs and
potentially an exit in its pursuit of a solution. These factors
will continue to pose medium-term operational risks for KPN.

Stable EBITDA, Improving FCF: Fitch base-case forecasts for KPN
indicate that the company will be able to improve its free cash
flow (FCF) along with an expansion in pre-dividend FCF margin to
around 12% within the next two to three years from 9% in 2016.
The expansion reflects broadly stable EBITDA and improvements in
cash interest costs and lower capex. Fitch base-case EBITDA
forecasts reflect the company's ongoing cost improvement
programme and potential operational risks that may preclude
further growth. These include increases in content costs, pricing
pressure, execution risks in cost reduction and delayed revenue
inflection within the business market segment.

Maintaining Financial Flexibility: KPN's funds from operations
(FFO) adjusted net leverage of 3.0x is comfortably within the
'BBB' rating level and provides about 0.5x of headroom. The
headroom is partly driven by approximately EUR70 million of
annual dividends received from its holding in Telefonica
Deutschland and minimal tax payments due to sizeable tax assets.
KPN's investment in Telefonica Deutschland (TEFD) is financial in
nature and Fitch expects KPN will continue to slowly reduce its
stake. To date the company has used sale proceeds from asset
disposals for both shareholder returns and to maintain its
operational and financial flexibility. Fitch believes KPN will
continue to take this approach in the future.


KPN's rating reflects its leading position in the Dutch telecoms
market. The company has strong in-market scale and share that
spans both fixed and mobile segments enabling it to pursue an
effective product bundling strategy. KPN's leverage metrics at
the 'BBB' level compare favourably to other western European
telecoms incumbents, but these are offset by greater operational
risks relating to its domestic mobile market and business
segment. KPN has to date effectively managed these risks through
operational execution and maintaining financial flexibility.

KPN's rating is anchored in the middle of its western European
telecoms peer group. Telecoms operators with a similar domestic
focus such as TDC A/S (BBB-/Stable), Telecom Italia S.p.A and BT
Group Plc (BBB+/Stable) have a lower rating due to higher
leverage and lower financial flexibility or a higher rating due
to better competitive dynamics in the domestic market with
similarly strong leverage metrics. Higher-rated peers such as
Orange S.A. (BBB+/Stable), Deutsche Telekom AG (BBB+/Stable) and
Telefonica SA (BBB/Stable) have similar strong domestic profiles
but also benefit from greater geographic diversification and


Fitch's key assumptions within Fitch ratings case for the issuer
- revenue decline of -3% in 2017 improving to -1% by 2019;
- broadly stable EBITDA around EUR2.4 billion , driven by a 2.5
   percentage point improvement in EBITDA margin between 2016 and
- a stable capex-to-sales ratio of 17.5% (excluding spectrum);
- a dividend payout ratio between 60% - 70% of pre-dividend FCF
   (excluding any dividend proceeds from TEFD);
- all TEFD dividends received are passed through to


Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action
- Revenue and EBITDA growth across all divisions combined with
   strengthened operating profile and competitive capability
- Expectations of FFO adjusted net leverage sustainably below
- Reduced competitive risks in the mobile segment which Fitch
   currently see as unlikely in the short to mediumterm

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action
- A deterioration in KPN's domestic operations that result in
   declining EBITDA.
- Expectations of FFO adjusted net leverage remaining above 3.5x
   on a sustained basis
- Aggressive shareholder remuneration policy that is perceived
   by Fitch not be in line with company's operating risk profile


Comfortable Liquidity: KPN has a strong liquidity position as a
result of existing cash resources, free cash-flow generation and
committed available credit facilities. At end-1H17 KPN had cash
and cash equivalents amounting to EUR916 million and a revolving
credit facility of EUR1.25 billion that is available until July
2022. Apart from the first call date of its euro-denominated
hybrids in 2018, KPN has no bond maturities over the next 12


Royal KPN N.V
-- Long-Term IDR: affirmed at 'BBB', Outlook Stable;
-- Senior unsecured debt: affirmed at 'BBB';
-- Subordinated capital securities: affirmed at 'BB+';

WOOD STREET 1: Moody's Affirms Ba3 Rating on Class E Notes
Moody's Investors Service has upgraded the ratings on the
following notes issued by Wood Street CLO 1 B.V.:

-- EUR27.75M Class D1 Senior Secured Deferrable Floating Rate
    Notes, Upgraded to Aa3 (sf); previously on Feb 13, 2017
    Upgraded to Baa1 (sf)

-- EUR1.5M Class D2 Senior Secured Deferrable Floating Rate
    Notes, Upgraded to Aa3 (sf); previously on Feb 13, 2017
    Upgraded to Baa1 (sf)

Moody's also affirmed the ratings on the following notes:

-- EUR29.93M (Current outstanding balance of EUR28.1M) Class C
    Senior Secured Deferrable Floating Rate Notes, Affirmed Aaa
    (sf); previously on Feb 13, 2017 Affirmed Aaa (sf)

-- EUR10.58M Class E Senior Secured Deferrable Floating Rate
    Notes, Affirmed Ba3 (sf); previously on Feb 13, 2017 Upgraded
    to Ba3 (sf)

Wood Street CLO 1 B.V., issued in September 2005, is a
collateralised loan obligation (CLO) backed by a portfolio of
mostly high-yield senior secured European loans. The portfolio is
managed by Alcentra Limited. The transaction's reinvestment
period ended in November 2011.


The rating upgrades of the notes are primarily a result of the
deleveraging of the senior notes following amortisation of the
underlying portfolio since the last rating action in February
2017 and also the improvement in the credit quality of the
portfolio. Moody's notes that following the May 2017 payment date
the Class B Notes have fully redeemed and that the Class C Notes
have partially redeemed by EUR1.83M. As a result of the
deleveraging, the OC ratios of the notes have increased for
Classes C and D. According to the June 2017 trustee report, the
classes C and D OC ratios are 283.70% and 138.99% respectively
compared to the levels at the last rating action in February 2017
216.55% and 136.27%.

Moody's has incorporated in its analysis one lowly rated exposure
totalling EUR4M that is reported to be repaying shortly.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. In its base
case, Moody's analysed the underlying collateral pool as having a
principal proceeds balance of EUR8.93M and performing par balance
of EUR62.57 million, a weighted average default probability of
19.62% (consistent with a WARF of 3179 and a weighted average
life of 3.28 years), a weighted average recovery rate upon
default of 48.91% for a Aaa liability target rating and a
diversity score of 8.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool. In each case, historical and market
performance and a collateral manager's latitude to trade
collateral are also relevant factors. Moody's incorporates these
default and recovery characteristics of the collateral pool into
its cash flow model analysis, subjecting them to stresses as a
function of the target rating of each CLO liability it is

Methodology Underlying the Rating Action:

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

Factors that would lead to an upgrade or downgrade of the

In addition to the base-case analysis, Moody's conducted
sensitivity analyses on the key parameters for the rated notes,
for which it lowered the weighted average recovery rate by 5
percentage points; the model generated outputs that were
unchanged for Class C and within two notches of the base case
results for Classes D and E.

This transaction is subject to a high level of macroeconomic
uncertainty, which could negatively affect the ratings on the
notes, in light of uncertainty about credit conditions in the
general economy. CLO notes' performance may also be impacted
either positively or negatively by 1) the manager's investment
strategy and behaviour and 2) divergence in the legal
interpretation of CDO documentation by different transactional
parties because of embedded ambiguities.

* Portfolio amortisation: The main source of uncertainty in this
transaction is the pace of amortisation of the underlying
portfolio, which can vary significantly depending on market
conditions and have a significant impact on the notes' ratings.
Amortisation could accelerate as a consequence of high loan
prepayment levels or collateral sales by the collateral manager
or be delayed by an increase in loan amend-and-extend
restructurings. Fast amortisation would usually benefit the
ratings of the notes beginning with the notes having the highest
prepayment priority.

* Recovery of defaulted assets: Market value fluctuations in
trustee-reported defaulted assets and those Moody's assumes have
defaulted can result in volatility in the deal's over-
collateralisation levels. Further, the timing of recoveries and
the manager's decision whether to work out or sell defaulted
assets can also result in additional uncertainty. Moody's
analysed defaulted recoveries assuming the lower of the market
price or the recovery rate to account for potential volatility in
market prices. Recoveries higher than Moody's expectations would
have a positive impact on the notes' ratings.

* Lack of portfolio granularity: The performance of the portfolio
depends on the credit conditions of a few large obligors. Because
of the deal's low diversity score and lack of granularity,
Moody's substituted its typical Binomial Expansion Technique
analysis by a simulated default distribution using Moody's
CDOROMTM software.

* Around 15.73% of the collateral pool consists of debt
obligations whose credit quality Moody's has assessed by using
credit estimates. As part of its base case, Moody's has stressed
large concentrations of single obligors bearing a credit estimate
as described in "Updated Approach to the Usage of Credit
Estimates in Rated Transactions" published in October 2009 and
available at

* Long-dated assets: The presence of assets that mature beyond
the CLO's legal maturity date exposes the deal to liquidation
risk on those assets. Moody's assumes that, at transaction
maturity, the liquidation value of such an asset will depend on
the nature of the asset as well as the extent to which the
asset's maturity lags that of the liabilities. Liquidation values
higher than Moody's expectations would have a positive impact on
the notes' ratings.

In addition to the quantitative factors that Moody's explicitly
modelled, qualitative factors are part of the rating committee's
considerations. These qualitative factors include the structural
protections in the transaction, its recent performance given the
market environment, the legal environment, specific documentation
features, the collateral manager's track record and the potential
for selection bias in the portfolio. All information available to
rating committees, including macroeconomic forecasts, input from
other Moody's analytical groups, market factors, and judgments
regarding the nature and severity of credit stress on the
transactions, can influence the final rating decision.

WP/AV CH HOLDINGS: S&P Assigns 'B' Long-Term CCR, Outlook Stable
S&P Global Ratings said it has assigned its 'B' long-term
corporate credit rating to WP/AV CH Holdings II B.V., a holding
company of Swiss software company Avaloq. The outlook is stable.

S&P said, "We also assigned our 'B' issue rating to Avaloq's
Swiss franc (CHF) 350 million equivalent term loan B and CHF60
million revolving credit facility (RCF). The recovery rating on
the debt is '3', indicating our expectation of meaningful
recovery prospects (rounded estimate: 60%) in the event of a
payment default.

"The ratings are in line with the preliminary ratings we assigned
on June 2, 2017 (see "Swiss Software Company Avaloq Assigned
Preliminary 'B' Rating; Outlook Stable," published on

Avaloq has recently issued a CHF350 million equivalent term loan
B as part of the acquisition of a significant minority stake in
the company by private equity firm Warburg Pincus.

S&P said, "We consider Avaloq to be private-equity controlled as
Warburg Pincus is currently the biggest shareholder.

"Our rating on Avaloq reflects its high debt, narrow focus,
modest profitability, some customer concentration, and
potentially some revenue volatility. However, it also
incorporates Avaloq's leading position in the Swiss software
market, very high customer retention rates thanks to mission-
critical products, good free operating cash flow (FOCF)
generation, and strong liquidity.

"Our assessment of Avaloq's business risk profile is constrained
by its narrow focus on software for private banking, two nascent
processing centers, and limited geographic diversity compared
with many of its competitors, including Sungard. In our view,
Avaloq has limited brand awareness in the rest of Europe and
Asia-Pacific, which are highly fragmented and where Avaloq needs
to compete with significantly larger and well-known industry
players for banks; IT outsourcing budgets. The business risk
profile is further constrained by Avaloq's relatively low margins
for a software company. This is primarily because of historically
negative margins for transaction processing as new processing
centers have not yet reached critical scale (and to some extent
due to previous investments in these centers), as well as the
high operating leverage embedded in Avaloq's operating model,
where recurring research and development costs are relatively
significant and fixed in order for the company to maintain its
technological competitive advantage. Additional constraints
include relatively high customer concentration in comparison with
peers, which is a result of Avaloq's relatively small customer
base; some reliance on license sales, which could lead to some
revenue and margin volatility over the year; and our anticipation
of declining revenues in 2017-2019 due to the known loss of two
large contracts.

"These constraints are somewhat offset by Avaloq's solid position
in the wealthy and attractive Swiss market, which also benefits
from very low country risk and continued growth in wealth.
Additionally, we view Avaloq's products as mission-critical
software for banks to perform real-time operations. Banks
therefore have very high switching costs, which creates extremely
high customer stickiness. As a result, Avaloq has a track record
of no customer voluntarily switching to a competitor and customer
losses only due to acquisitions over a long period of time.
Avaloq further benefits from a relatively large predictable
recurring revenue stream of nearly 70% of revenues, and
relatively favorable prospects for banks; IT outsourcing trends
given increased competition and compliance costs -- all of which
require banks to become more efficient and provide further room
for growth from new customers. Finally, we think Avaloq's
diversification in the high value-add of transaction processing
to banks is a positive, given fairly limited competition in this
space in Europe.

"We understand that Avaloq has a joint venture with Raiffeisen
(Arizon), which is recognized as an equity associate. We
currently do not factor any meaningful short-term benefit or risk
related to this asset.

"Our assessment of Avaloq's financial risk profile is constrained
by the recent recapitalization and the fact that ratios will
weaken in 2018 and 2019 due to some of the group's contracts
being terminated and the related revenue attrition in the next
two years. The proposed recapitalization reflects pro forma S&P
Global Ratings-adjusted debt to EBITDA of about 5.9x for 2016. We
adjust the company's EBITDA for capitalized development costs. We
also adjust the company's figures for unfunded pension
liabilities (about CHF66 million added to debt in 2016) and
operating leases (about CHF62 million added to debt and about
CHF17 million added to EBITDA). We expect meaningful improvement
in EBITDA in 2017, primarily thanks to lower capitalized
development costs and removal of a lossmaking contract, driving
adjusted debt to EBITDA to less than 5x in 2017. However, we
anticipate that the known terminated customers contracts will
lead to an increase in adjusted leverage to well above 5x by
2019. This is partly offset by relatively solid free cash flow
generation, which we expect to remain at 5% of debt or more
throughout 2019, and our forecast of solid EBITDA cash interest
coverage of more than 4x.

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

-- Revenue growth of about 2% in 2017, reflecting lower software
    license sales due to a decline in the company's order book
    but more than offset by increased maintenance and new
    processing transactions.
-- Revenue decline of about 15% in 2018, recovering to a decline
    of about 2% in 2019, mainly owing to the aforementioned
    contract terminations, only somewhat offset by new processing
-- Adjusted EBITDA margin improving to about 21% in 2017 from
    about 14% in 2016, mainly due to the removal of a lossmaking
    contract and the end of the launch project for the German
    processing center, declining to about 18% by 2019 due to the
    revenue decline, partly offset by cost reduction.
-- Capital expenditures (capex) of about CHF20 million,
    excluding capitalized development costs.

Based on these assumptions, S&P arrives at the following credit

-- Adjusted debt to EBITDA temporarily below 5.0x at 4.3x in
    2017, before increasing to nearly 6.0x in 2019;
-- Adjusted funds from operations (FFO) to debt of about 18% in
    2017, declining to about 10%-11% in 2019; and
-- Adjusted FOCF to debt of about 12% in 2017, declining to
    about 6% in 2019.

S&P said, "The stable outlook reflects our expectation that
Avaloq will grow its customer base outside of Switzerland,
maintain very high retention with the exception of the two known
customer losses, improve its adjusted EBITDA margin toward 20%
thanks to cost efficiencies, and maintain at least adequate

"We could raise the rating if Avaloq were to reduce adjusted debt
to EBITDA to sustainably less than 5x, coupled with revenue and
EBITDA growth. We forecast this to be the case in 2017 but we
currently do not see this as sustainable over the medium term,
given the expected revenue decline in 2018 following certain
contract terminations.

"We currently see near-term prospects of a downgrade as remote
given the company's strong liquidity and our expectation of solid
free cash flow generation. However, we could lower the rating if
the financial policy was more aggressive than we expected,
leading to leverage increasing sustainably to the middle of the
6x-7x range, coupled with operational issues (for example, big
customer losses), leading to the company burning cash or having
minimal cash balances."

* NETHERLANDS: Number of Corporate Bankruptcies Down in July
Statistics Netherlands reports that the number of corporate
bankruptcies has fallen.

According to Statistics Netherlands, there were 34 fewer
bankruptcies in July than in June 2017.  The decline follows an
increase in May and June. Most bankruptcies in July were recorded
in the trade sector, Statistics Netherlands notes.

If the number of court session days is not taken into account,
251 businesses and institutions (excluding one-man businesses)
were declared bankrupt in July 2017, Statistics Netherlands
discloses.  With a total of 50, the trade sector suffered most,
Statistics Netherlands states.

Trade is among the sectors with the highest number of businesses,
Statistics Netherlands relays.  In July, the number of
bankruptcies was relatively highest in the sector renting and
other business services, according to Statistics Netherlands.


CYFROWY POLSAT: Moody's Revises Outlook to Pos., Affirms Ba2 CFR
Moody's Investors Service has changed to positive from stable the
outlook on the ratings of Cyfrowy Polsat S.A.  Concurrently,
Moody's has affirmed the company's Ba2 corporate family rating
(CFR) and its Ba2-PD probability of default rating (PDR).

"The change in outlook to positive reflects Polsat's track record
of solid free cash flow generation, its declining leverage as
well as its conservative financial policies and net leverage
target of 1.75x," says Alejandro Nunez, a Moody's Vice
President -- Senior Analyst, and lead analyst for Polsat.


Polsat's Ba2 ratings reflect: (1) its strong market positions in
TV broadcasting, pay-TV and mobile communications in Poland; (2)
the synergy opportunities from its exposure to both content and
mobile markets as evidenced by the strong uptake of its multiplay
smartDOM offer; (3) its consistent deleveraging over the past two
years which Moody's expects will continue during 2017-2018 in
line with the company's net leverage target of 1.75x over the
medium term; (4) the company's simplified corporate and capital
structures following the acquisition of Midas and debt
refinancing in 2016-2017; and (5) its good liquidity profile and
reduced foreign exchange exposure.

The rating also reflects: (1) Polsat's broadly stable operational
performance despite strong GDP growth in Poland amidst market
dynamics that are more challenging in the mobile telecoms segment
than in the pay-TV market; (2) its unproven LTE development
strategy based on frequency refarming; (3) its TV & mobile-
centric model somewhat vulnerable to converged fixed-mobile
competition; and (4) its low capex to sales ratio relative to

Polsat has demonstrated an adherence to its conservative
financial policies over the past two years, not only by reducing
its net leverage target to a range of 1.75x (from company-
reported 2.5x net debt/EBITDA previously), but also through its
implementation of a modest, gradual dividend payout. In June
2017, Polsat announced a dividend of PLN0.32 per share (totaling
PLN204.7 million) for FY2017. Moody's views this dividend payout
as prudent in the context of Polsat's cash flow generation and
the flexibility it grants the company in progressing toward its
medium-term leverage target.

As was anticipated in early 2016, Polsat reduced its debt load by
over 10% between Q1 2016 and April 2017, principally through the
repayment of PLN371 million Midas term loans in April 2016,
PLN375 million 16.0% Midas notes in May 2016 and PLN939 million
10% Litenite notes in April 2017 (including accrued interest and
applicable call premia, totaling approximately PLN1.685 billion).
As a result, the company reduced its Moody's-adjusted leverage by
0.85x over that period, from 4.15x in Q1 2016 to 3.30x as of
April 2017.

Polsat's debt structure is comprised exclusively of zloty-
denominated term loans and PLN1.0 billion of Series A senior
unsecured notes (unrated) due 2021. In order for the company to
progress toward its stated net leverage target, Polsat may
voluntarily prepay a portion of its outstanding debt over the
next 18-24 months aside from the principal amortization of
certain term loans.


The change in outlook to positive from stable primarily reflects
the improvement in Polsat's leverage and cash-flow credit
protection metrics, largely as a result of the company's
proactive debt reduction over the past year. While Moody's
expects that Polsat's operating performance and profitability
will remain broadly stable over the next two years, sustained
healthy free cash flow generation will allow the company to
continue reducing debt.

The positive outlook reflects Moody's expectations that Polsat's
gross leverage will continue to decline gradually toward 3.0x
while its Retained Cash Flow (RCF) / Gross Debt will rise
gradually toward 25% over the next 12 to 18 months (both ratios
as adjusted by Moody's). The outlook also incorporates an
expectation that Polsat will not implement during that time
horizon any material credit-adverse changes to its current
dividend and/or leverage policies.


Positive rating pressure could develop on Polsat's ratings were
it to achieve a Gross Debt / EBITDA ratio consistently below 3.0x
and a Retained Cash Flow (RCF) / Gross Debt sustainably above 25%
(both ratios as adjusted by Moody's).

Negative pressure could be exerted on Polsat's ratings as a
result of a material weakening of its operating performance
and/or an increase in debt levels resulting in Gross Debt /
EBITDA and/or RCF / Gross Debt (both as adjusted by Moody's)
sustainably above 3.5x and below 20%, respectively. A material
deterioration of Polsat's good liquidity would also exert
downward pressure on its ratings.



Issuer: Cyfrowy Polsat S.A.

-- LT Corporate Family Rating, Affirmed Ba2

-- Probability of Default Rating, Affirmed Ba2-PD

Outlook Actions:

Issuer: Cyfrowy Polsat S.A.

-- Outlook, Changed To Positive From Stable


The principal methodology used in these ratings was
Telecommunications Service Providers published in January 2017.

Polsat is one of Poland's largest companies and one of the
Central and Eastern European region's leading media and
telecommunications companies. As the largest pay-TV provider in
Poland and one of the leading satellite platforms in Europe,
Polsat offers access to over 180 TV channels. Polsat is also
present in Poland's TV broadcasting and television production
markets, through its commercial TV broadcast subsidiary Telewizja
Polsat, offering 24 popular TV channels including 17 channel in
HD standard. Through its subsidiary Polkomtel's 2G/3G/LTE mobile
telecommunications network, it offers retail mobile voice and
broadband services. It also offers wholesale services to other
telecommunications operators, including network interconnection,
roaming, shared access to network assets and the lease of its
network infrastructure. The Cyfrowy Polsat Group is listed on the
Warsaw stock exchange and it is majority owned indirectly by Mr.
Zygmunt Solorz. In FY2016, Polsat reported consolidated revenue
of PLN9.7 billion and EBITDA of PLN3.6 billion with an EBITDA
margin of 37.4%.


ANELIK RU: Bank of Russia Revokes Banking License
The Bank of Russia, by its Order No. OD-2244, dated August 9,
2017, revoked the banking license of Moscow-based credit
institution Commercial Bank Anelik RU (limited liability
company), or CB Anelik RU LLC (Registration No. 3443) from
August 9, 2017, according to the press service of the Central
Bank of Russia.  According to the financial statements, as of
July 1, 2017, the credit institution ranked 524th by assets in
the Russian banking system.

The Bank was a settlement centre of one of the payment systems;
however, the Bank of Russia did not categorize it as an important
credit institution in the payment services market.

It was revealed that CB Anelik RU repeatedly violated law on
countering the legalization (laundering) of criminally obtained
incomes and the financing of terrorism, including, but not
limited to, the complete and reliable notification of the
authorized body about operations subject to obligatory control.
Starting from late 2016, the bank was involved in dubious
transactions associated with overseas money transfers and cashing
out, as well as transit operations.

The management and owners of CB Anelik RU have failed to take
appropriate measures to prevent the credit institution from
becoming involved in dubious operations of its clients.  Under
the circumstances, the Bank of Russia took the decision to
withdraw CB Anelik RU from the banking services market.

The Bank of Russia took such an extreme measure -- revocation of
the banking license -- because of the credit institution's
failure to comply with federal banking laws and Bank of Russia
regulations, repeated violations within a year of Bank of Russia
requirements stipulated by Articles 6 and 7 (excluding Clause 3
of Article 7) of the Federal Law "On Countering the Legalisation
(Laundering) of Criminally Obtained Incomes and the Financing of
Terrorism" as well as Bank of Russia regulations issued in
accordance with the said law and application of the measures
stipulated by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)", taking into account.

BANK RESERV: Put On Provisional Administration, License Revoked
The Bank of Russia, by its Order No. OD-2240, dated August 9,
2017, revoked the banking license of Chelyabinsk-based credit
COMPANY) or BANK RESERV (SC) (Registration No. 2364) from
August 9, 2017, according to the press service of the Central
Bank of Russia.

According to the financial statements, as of July 1, 2017, the
credit institution ranked 415th by assets in the Russian banking

The operations of BANK RESERV (SC) bear elevated credit risks.
The supervisory authority has repeatedly requested the bank to
create additional provisions.  In June and July this year, the
Bank of Russia's supervisory efforts revealed in the credit
institution operations aimed at replacement of high-quality
liquid assets with dubious assets.  Furthermore, the Bank of
Russia revealed circumstances pointing to the bank's efforts to
conceal the loss of considerable funds.  The creation of
additional loss provisions resulted in the considerable decline
in the bank's capital and its operations show reasons for
bankruptcy (insolvency) prevention measures.

The Bank of Russia repeatedly applied supervisory measures to
BANK RESERV (SC), including three impositions of restrictions on
household deposit taking.

The bank's management disassociated themselves from solving the
problems, which points to a lack of prospects for bringing its
activity back to normal.  Under the circumstances, the Bank of
Russia took the decision to withdraw BANK RESERV (SC) from the
banking services market.

The Bank of Russia takes this extreme measure -- revocation of
the banking license -- because of the credit institution's
failure to comply with federal banking laws and Bank of Russia
regulations, due to repeated application within a year of
measures envisaged by the Federal Law "On the Central Bank of the
Russian Federation (Bank of Russia)", considering a real threat
to the creditors' and depositors' interests.

The Bank of Russia, by its Order No. OD-2241, dated August 9,
2017, appointed a provisional administration to BANK RESERV (SC)
for the period until the appointment of a receiver pursuant to
the Federal Law "On the Insolvency (Bankruptcy)" or a liquidator
under Article 23.1 of the Federal Law "On Banks and Banking
Activities".  In accordance with federal laws, the powers of the
credit institution's executive bodies have been suspended.

BANK RESERV (SC) is a member of the deposit insurance system. The
revocation of the banking license is an insured event as
stipulated by Federal Law No. 177-FZ "On the Insurance of
Household Deposits with Russian Banks" in respect of the bank's
retail deposit obligations, as defined by law.  The said Federal
Law provides for the payment of indemnities to the bank's
depositors, including individual entrepreneurs, in the amount of
100% of the balance of funds but no more than a total of RUR1.4
million per one depositor.

KONTINENT FINANS: Put On Provisional Administration
The Bank of Russia, by its Order No. OD-2242, dated August 9,
2017, revoked the banking license of Moscow-based credit
institution non-bank credit institution Kontinent Finans (public
joint-stock company) or NCI Kontinent Finans (PJSC) (Registration
No. 149-K) from August 9, 2017, according to the press service of
the Central Bank of Russia.

According to the financial statements, as of July 1, 2017, the
credit institution ranked 568th by assets in the Russian banking
system.  NCI Kontinent Finans (PJSC) is not a member of the
deposit insurance system.

Besides, the NCI failed to comply with law on countering the
legalisation (laundering) of criminally obtained incomes and the
financing of terrorism, including, but not limited to, the
credible notification of the authorised body about operations
subject to obligatory control.  Furthermore, the credit
institution carried out dubious cash out transactions to purchase
and sale investment-grade coins of precious metals.  The
management and owners of NCI Kontinent Finans (PJSC) have failed
to take appropriate measures to prevent the credit institution
from becoming involved in dubious operations of its customers.
Under the circumstances, the Bank of Russia took the decision to
withdraw NCI Kontinent Finans (PJSC) from the banking services

The Bank of Russia took this decision due the credit
institution's failure to comply with federal banking laws and
Bank of Russia regulations, repeated violations within one year
of the requirements stipulated by Article 7 (except for Clause 3
of Article 7) of the Federal Law "On Countering the Legalisation
(Laundering) of Criminally Obtained Incomes and the Financing of
Terrorism", and the requirements of Bank of Russia regulations
issued in compliance with the indicated Federal Law, and taking
into account repeated applications within one year of measures
envisaged by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)".

The Bank of Russia, by its Order No. OD-2243, dated August 9,
2017, appointed a provisional administration to NCI Kontinent
Finans (PJSC) for the period until the appointment of a receiver
pursuant to the Federal Law "On the Insolvency (Bankruptcy)" or a
liquidator under Article 23.1 of the Federal Law "On Banks and
Banking Activities".  In accordance with federal laws, the powers
of the credit institution's executive bodies have been suspended.

VSK INSURANCE: Fitch Affirms BB- IFS Rating, Outlook Stable
Fitch Ratings has affirmed Russia-based VSK Insurance Joint Stock
Company's (VSK) Insurer Financial Strength (IFS) Rating at 'BB-',
Issuer Default Rating (IDR) at 'BB-' and senior unsecured debt at
'BB-'. The Outlooks are Stable.


The ratings reflect VSK's strong operating profitability,
supported by investment return and the adequate quality of the
insurer's investment portfolio. The ratings are negatively
impacted by the weak risk-adjusted capital position of VSK, its
high exposure to a single line with a deteriorating loss ratio
(motor third-party liability insurance; MTPL) and somewhat weak
liquidity position.

The alignment of the IFS Rating with the IDR reflects the soft
cap "Average" recovery assumptions Fitch applies to Russia. The
rating of the bond is aligned with VSK's IDR, as a baseline
recovery assumption of 'average' is applied.

Significant net profit generation over 2016 increased the
company's available capital, which was partially offset by higher
target capital as a result of an increase in net premiums. VSK's
risk-adjusted capital position, as measured by Fitch's Prism
factor-based model, remained in the 'weak' category based on 2016
results. In terms of regulatory requirements VSK's statutory
solvency margin was 197% at end-2016, slightly higher than 193%
at end-1H16.

In 2016 VSK's profitability remained robust, with a return on
equity at 29%, in line with the 32% reported in 2015. The net
result for 2016 was underpinned by historically strong investment
return and by a positive underwriting result.

The company's combined ratio improved to 94.3% in 2016, from
100.9% in 2015. This was mainly driven by an improvement in the
loss ratio (excluding subrogation income) to 58.4% in 2016 from
65.4% in 2015. This improvement in the loss ratio was due to the
voluntary motor damage line and, to a lesser extent, the non-
motor lines, which together accounted for 60% of net written
premiums in 2016, and one-off releases of reserves following an
actuarial review. Fitch, however, expects VSK's combined ratio to
deteriorate in 2017 as the company continues its expansion in
MTPL which is loss-making in Russia.

VSK remains highly concentrated in the MTPL business. The MTPL
line accounted for 40% of net written premiums in 2016 and the
loss ratio (including claims handling expenses) was 80.2% in 2016
based on an internal actuarial assessment, albeit down from 82.6%
in 2015. This was exacerbated by VSK's recent acquisition of VTB
insurance's compulsory MTPL business, as the size of the
portfolio being acquired represented around 3% of VSK's total
existing business by reserves at end-2016. However, as the
portfolio is in run-off, Fitch does not expect this acquisition
to lead to a long-term shift in the business mix.

VSK has recently made numerous acquisitions, including a number
of insurance companies linked to its shareholders: IC VSK
Lifeline in July 2017, IC Europlan in June 2017 and BIN Insurance
in July 2016. These acquisitions were part of VSK's strategy to
bring the group's insurance businesses under VSK's direct
control. Due to the small size of the acquired companies relative
to VSK's existing business, Fitch does not believe that the
acquisitions have significantly affected the insurer's credit

VSK's liquidity position remains weak, but is gradually
improving, with the provisional liquid assets-to-net technical
reserves ratio at 87% at end-2016, versus 85% at end-2015. The
average credit quality of VSK's investment portfolio is strong
for the ratings. Fitch views the company's financial flexibility
as adequate for the ratings.


The ratings could be downgraded if the combined ratio
deteriorates to above 105% on a sustained basis, or if VSK's
capital strength, as assessed by Fitch, weakens significantly. A
downgrade may also result from material deterioration in
investment or liquidity risks.

The ratings could be upgraded if VSK achieves a profitable
diversification of the insurance portfolio, or if VSK's capital
strengthens significantly.

U N I T E D   K I N G D O M

LEHMAN BROTHERS: UK Administrator Warns of Financial Crisis
Holly Williams at the Press Association reports that the UK
administrator of collapsed investment bank Lehman Brothers has
warned the risks of another financial crisis loom large and said
regulators would still struggle to contain investor panic.

A decade on from the start of the financial crisis, Tony Lomas --
the PwC partner in charge of the administration of the bank --
told the Press Association the complexity of financial products
means "there is always a risk" of another meltdown.

Despite the lessons learned over the past 10 years, Mr. Lomas, as
cited by the Press Association, said regulators would still find
it hard to stop a firm going bust once investor and market
confidence was lost.

Mr. Lomas said he hoped measures put in place in recent years and
incoming ring-fencing rules to protect retail customer money
would see another Lehman-style collapse picked up sooner and
allow a more orderly wind-down, the Press Association relates.

"Once the market has lost confidence in a financial institution,
it rapidly deteriorates and I find it hard to see how you can
restore that," the Press Association quotes Mr. Lomas as saying.
"I find it hard to imagine that you can stop that rush of
business out the door by various devices that have been
introduced over the past six or seven years."

According to the Press Association, the administrators repaid all
of the GBP35 billion owed to creditors of the European arm of
Lehman three years ago -- with a surplus of between GBP7.5
billion and GBP8 billion after fees, in what Mr. Lomas describes
as a "stupendous outcome".

Hedge funds, together with US parent Lehman Brothers Inc, are
wrangling in the courts to claim their share of the UK surplus,
the Press Association relays.

Mr. Lomas hopes that if a settlement can be reached, it could
finally resolve the UK administration process some time next
spring, the Press Association notes.  If it is left to play out
in the courts, however, it could rumble on for another four or
five years, the Press Association states.

Mr. Lomas said it has been a "phenomenal journey", leading a team
that at one time included 5,000 Lehman staff and 500 PwC
employees, the Press Association relates.

According to the Press Association, now, there are still around
30 ex-Lehman staff and 15 PwC employees working on the case.

The costs of the UK administration so far have run to GBP2.7
billion, although this pales in comparison to the many billions
of dollars paid in US bankruptcy proceedings, the Press
Association discloses.

The process is still some way off completing in the US and will
land creditors with a hefty shortfall, with just 30 to 40 cents
in the dollar expected to be returned, the Press Association

                        About Lehman Brothers

Lehman Brothers Holdings Inc. -- was
the fourth largest investment bank in the United States.  For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.

Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555).  Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history.  Several other affiliates followed

Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.

The Debtors' bankruptcy cases were assigned to Judge James M.
Peck.  Judge Shelley Chapman took over the case after Judge Peck
retired from the bench to join Morrison & Foerster.

A team of Weil, Gotshal & Manges, LLP, lawyers led by the late
Harvey R. Miller, Esq., serve as counsel to Lehman.  Epiq
Bankruptcy Solutions serves as claims and noticing agent.

Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, served
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., served as the
Committee's  investment banker.

On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)).  James W. Giddens was appointed as
trustee for the SIPA liquidation of the business of LBI.  He is
represented by Hughes Hubbard & Reed LLP.

The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion.  Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees.  Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.

Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history.  The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.

                         *     *     *

In October 2016, the team winding down LBHI paid $3.8 billion to
creditors, the 11th distribution since Lehman's collapse in 2008.
This brought the total payout to more than $113.6 billion.
Bondholders were projected to receive about 21 cents on the
dollar when Lehman's bankruptcy plan went into effect in early
2012.  The 11th distribution raised the bondholders' recovery to
more than 40 cents on the dollar and recoveries for general
unsecured creditors of Lehman's commodities to 79 cents on the
dollar.  Lehman's aggregate 12th distribution to unsecured
creditors pursuant to its confirmed Chapter 11 plan will total
approximately $3.0 billion.

REDX PHARMA: Joint Administrators Mull Options for Business
Alliance News reports that Redx Pharma PLC on Aug. 10 said its
joint administrators have published their proposals, as they seek
to bring the company out of administration.

The company was put into administration after a loan from
Liverpool City Council came due, and although Redx made an offer
to pay an immediate GBP1.0 million partial repayment, with the
balance payable within seven days, this was declined by the
council, Alliance News recounts.

Jason Baker and Miles Needham of FRP Advisory LLP were appointed
as joint administrators, Alliance News discloses.

The administrators looked to rescue the company, considering two
options -- exploring raising additional funding to repay all
creditors, and or realise some of the assets held by the company,
and use the assets to rescue the company, or a potential
combination of the two options, Alliance News relays.

According to Alliance News, the administrator said after talking
with major shareholders, it "became clear" the amount of funding
it would need to return the company as a going concern would not
"realistically be achievable" through a shareholder fundraise.
Additionally, a significant shareholder expressed it would seek
to vote down any fund raise that would dilute existing
shareholders, Alliance News notes.

Therefore, the administrators concluded that the "only realistic
strategy" was to realise certain assets held by the company,
according to Alliance News.  Ultimately, it was agreed with Loxo
Oncology Inc to sell the BTK inhibitor drug development program
for USD40 million, and this deal was completed in July, Alliance
News recounts.

The administrators, as cited by Alliance News, said that, while
Redx is now in a position to settle all creditor claims in full,
they must first undertake certain statutory duties before exiting

Shares in Redx remain suspended, Alliance News notes.

Redx Pharma is focused on the discovery and development of
proprietary, small molecule therapeutics to address areas of high
unmet medical need, in cancer, immunology and infection.


* BOOK REVIEW: The Money Wars
Author: Roy C. Smith
Publisher: Beard Books
Softcover: 370 pages
List Price: $34.95
Review by David Henderson

Get your own personal today at

Business is war by civilized means. It won't get you a tailhook
landing on an n aircraft carrier docked in San Diego, but the
spoils of war can be glorious to behold.

Most executives do not approach business this way. They are
content to nudge along their behemoths, cash their options, and
pillage their workers. This author calls those managers "inertia
ridden." He quotes Carl Icahn describing their companies as run
by "gross and widespread incompetent management."

In cycles though, the U.S. economy generates a few business
warriors with the drive, or hubris, to treat the market as a
battlefield. The 1980s saw the last great spectacle of business
titans clashing. (The '90s, by contrast, was an era of the
investment banks waging war on the gullible.) The Money Wars is
the story of the last great buyout boom. Between 1982 and 1988,
more than ten thousand transactions were completed within the
U.S. alone, aggregating more than $1 trillion of capitalization.

Roy Smith has written a breezy read, traversing the reader
through an important piece of U.S. history, not just business
history. Two thirds of the way through the book, after covering
early twentieth century business history, the growth of financial
engineering after WWII, the conglomerate era, the RJR-Nabisco
story, and the financial machinations of KKR, we finally meet the
star of the show, Michael Milken. The picture painted by the
author leads the reader to observe that, every now and then, an
individual comes along at the right time and place in history who
knows exactly where he or she is in that history, and leaves a
world-historical footprint as a result. Whatever one may think of
Milken's ethics or his priorities, the reader will conclude that
he is the greatest financial genius this country has produced
since J.P. Morgan.

No high-flying financial era has ever happened in this country
without the frothy market attracting common criminals, or in some
cases making criminals out of weak, but previously honest men
(and it always seems to be men). Something there is about
testosterone and money. With so many deals being done, insider
trading was inevitable. Was Michael Milken guilty of insider

Probably, but in all likelihood, everybody who attended his
lavish parties, called "Predators' Balls," shared the same
information. Why did the Justice Department go after Milken and
his firm, Drexel Burnham Lambert with such raw enthusiasm? That
history has not yet been written, but Drexel had created a lot of
envy and enemies on the Street.

When a better history of the period is written, it will be a
study in the confluence of forces that made Michael Milken's
genius possible: the sclerotic management of irrational
conglomerates, a ready market for the junk bonds Milken was
selling, and a few malcontent capitalist like Carl Icahn and Ted
Turner, who were ready and able to wage their own financial

This book is a must read for any student of business who did not
live through any of these fascination financial eras.

Roy C. Smith is a professor of entrepreneurship, finance and
international business at NYU, and teaches on the faculty there
the Stern School of Business. Prior to 1987, he was a partner at
Goldman Sachs. He received a B.S. from the Naval Academy in 1960
and an M.B.A. from Harvard in 1966.


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 * * *