TCREUR_Public/171004.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Wednesday, October 4, 2017, Vol. 18, No. 197


                            Headlines


C R O A T I A

VIADUKT: Zagreb Court Commences Bankruptcy Proceedings
ZAGREB: S&P Affirms 'BB' Issuer Credit Rating, Outlook Stable


D E N M A R K

NETS A/S: Moody's Puts Ba2 CFR Under Review for Downgrade


F I N L A N D

SCFI RAHOITUSPALVELUT II: Fitch Affirms BB+ Rating on Cl. E Notes


F R A N C E

CGG SA: Creditors Accept Chapter 11 Bankruptcy Plan
SOCIETE GENERALE: Fitch Affirms BB+ Add'l. Tier 1 Capital Rating


G E R M A N Y

DEUTSCHE BANK: Fitch Cuts Additional Tier 1 Notes Rating to BB-


I R E L A N D

HARVEST CLO XII: Fitch Rates EUR13MM Class F-R Notes 'B-(EXP)'


I T A L Y

SUNRISE SPV 20: Moody's Assigns (P)B1 Rating to Class E Notes


N E T H E R L A N D S

ABN AMRO: Fitch Rates EUR1BB Additional Tier 1 Notes BB+
CADOGAN SQUARE II: S&P Lowers Class E Notes Rating to BB- (sf)
CAIRN CLO VIII: S&P Assigns Prelim B- (sf) Rating to Cl. F Notes
ING GROEP: Moody's Affirms Ba1 Pref. Stock Non-cumulative Rating


P O R T U G A L

LUSITANO MORTGAGES No. 6: Moody's Affirms Caa3 Cl. D Notes Rating


R U S S I A

CREDIT BANK: Moody's Hikes LT Senior Unsecured Debt Rating to Ba3
SUEK JSC: Moody's Revises Outlook to Positive, Affirms Ba3 CFR
TATAGROPROMBANK LLC: Liabilities Exceed Assets, Assessment Shows
TEMPBANK PJSC: Put on Provisional Administration, License Revoked
VOZROZHDENIE BANK: S&P Affirms 'BB-/B' CCR, Outlook Negative


S P A I N

NH HOTEL: Moody's Affirms B2 CFR, Revises Outlook to Positive


S W I T Z E R L A N D

CREDIT SUISSE: Fitch Affirms BB Rating on Additional Tier 1 Notes
UBS GROUP: Fitch Raises Rating on Tier 1 Sub. Notes From BB+


U N I T E D   K I N G D O M

BARCLAYS PLC: Fitch Affirms BB+ Basel III-Compliant Debt Rating
HBOS GROUP: Moody's Hikes Backed Preferred Stock Rating from Ba1
LASER ABS 2017: Fitch Affirms BB+ Rating on Class D Notes
MONARCH AIRLINES: Private Equity Owner Comments on Collapse
NORTH POINT: Completes Company Voluntary Arrangement

ROYAL BANK: Moody's Affirms (P)Ba3 Preference Shelf Rating
TATA STEEL UK: S&P Affirms 'B+' CCR on Merger With Thyssenkrupp
UNITED BISCUITS: S&P Affirms Then Withdraws 'B+' CCR
XTREME BUSINESS: Enters Administration, 50 Jobs Affected


                            *********



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C R O A T I A
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VIADUKT: Zagreb Court Commences Bankruptcy Proceedings
------------------------------------------------------
SeeNews reports that a Zagreb-based commercial court has opened
bankruptcy proceedings in Croatian construction company Viadukt.

According to SeeNews, Viadukt said in a Zagreb bourse filing the
court opened the proceedings on Monday, Oct. 2, after earlier
judging that the firm has met the conditions for bankruptcy.

In March, state-owned motorway operator Hrvatske Ceste terminated
a deal for the building of Ciovo bridge it had signed with
Viadukt in 2015, SeeNews recounts.  At the same time, Viadukt's
bank accounts were blocked, SeeNews discloses.

These events culminated in financial problems for the
construction company, which sent its shares plummeting, SeeNews
notes.


ZAGREB: S&P Affirms 'BB' Issuer Credit Rating, Outlook Stable
-------------------------------------------------------------
S&P Global Ratings affirmed its 'BB' long-term issuer credit
rating on the Croatian city of Zagreb. The outlook is stable.

OUTLOOK

S&P said, "The stable outlook on Zagreb reflects our view that
continued strong operating balances will help counterbalance
Zagreb's increased investment plans. Despite our expectations of
a slight rise in tax-supported debt in absolute terms, which
includes the debt of municipal company Zagrebacki Holding, the
city's debt burden will remain low over 2017-2019."

Downside Scenario

S&P said, "We could downgrade Zagreb if we saw a significant
worsening of financial performance and an increase in tax-
supported debt to over 120% of consolidated operating revenues.
We would also consider revising our assessment of Zagreb's
creditworthiness downward if we saw continued pressure on its
cash levels, resulting in further deterioration of its liquidity
coverage ratio."

Upside Scenario

S&P said, "Contingent on an upgrade of the sovereign, we could
raise the rating if the city structurally improved its liquidity
position, resulting in cash and funds available under credit
facilities covering yearly debt service sustainably by more than
80%. Additionally, stronger medium- and long-term planning,
coupled with strict oversight of municipal companies, could
enhance our view of the city's financial management and intrinsic
creditworthiness."

RATIONALE

S&P said, "The rating reflects our view that the city will
continue its trend of high operating balances, exceeding 10% of
operating revenues, allowing room for more rapid investments.
This should enable the city to avoid excessive debt accumulation
and retain its current liquidity position."

Nevertheless, these factors remain counterbalanced by an
institutional framework that is subject to relatively frequent
changes, revenue and expenditure mismatches, and financial
management weaknesses. Zagreb's stand-alone credit profile (SACP)
is at 'bb'.

The institutional framework and financial management limit
Zagreb's creditworthiness. In S&P's view, Zagreb's
creditworthiness remains constrained by the institutional setup
under which Croatian municipalities operate. The framework
exhibits frequent changes and an unbalanced distribution of
resources that are not sufficiently aligned to tasks delegated to
the municipal level. This is exemplified by the latest change to
the tax system, which took effect at the beginning of 2017. The
tax reform is aimed at easing the tax burden for individuals and
companies by decreasing several tax rates and brackets (for
example, the maximum rate for personal income tax to 36% from
40%). This effectively diminishes Zagreb's revenue-raising
abilities. The reform stipulates that revenue shortfalls that
result will be covered by the central government through
transfers. However, these transfers have not yet been fully
codified by the government. Ultimately, the unpredictability of
the central government's actions constrains policy effectiveness
at the city, limiting Zagreb's ability to effectively plan for
the long term.

Milan Bandic was re-elected to serve as the mayor of Zagreb for a
sixth four-year term in June 2017, indicating some stability of
the city's management. Nonetheless, S&P sees management's
effectiveness as constrained by unreliable long-term planning.
The use of unconventional debt instruments such as factoring
deals, and a somewhat difficult relationship between the
government and city assembly, as shown by the mayor almost being
ousted in December 2016, further constrain our management
assessment.

The city's management of municipal companies remains weak
overall. The board of Zagrebacki Holding maintains very close
ties with the city's management, although clear decision-making
procedures appear to be lacking. The city provides subsidies to
Zagrebacki Holding of about Croation kuna (HRK) 580 million
(about $90 million) annually. There have been ongoing discussions
between both parties on removing the loss-making transportation
company (ZET) from Zagrebacki Holding's portfolio, but a decision
has not been taken yet. This is an important decision since it
would substantially alter Zagrebacki Holding's financial
performance.

Zagreb's economy is diversified. Companies in the city contribute
roughly 50% of all corporate profits in the country, and
unemployment has been steadily decreasing (7.6% in 2016). The
pull the city exerts has resulted in a growing population, which
in turn supports the city's economic and tax base. We estimate
that the city housed around 798,500 inhabitants, or 19% of
Croatia's total population in 2016. Furthermore, the city's
management continues to focus on projects intended to promote
Zagreb as a tourist and international conference destination. For
example, it is building a new center for corporate conferences
and a network of cycling paths, among various other projects. In
S&P's view, however, these strengths are muted by the country's
national GDP per capita, which is the basis for our assessment of
Zagreb's economic profile. We forecast GDP per capita at around
$15,000 in 2019, increasing broadly in line with sovereign growth
trends, but this remains average compared with international
peers'.

Operating surpluses will remain strong, helping keep debt low and
limiting the risks from weak liquidity. Looking ahead, S&P
expects that Zagreb will exhibit operating balances averaging 11%
of operating revenues between 2017 and 2019, broadly unchanged
from our previous review. This is mainly owing to solid economic
growth averaging 3%.

In S&P's view, Zagreb's budgetary flexibility is weak. Personal
income tax, which the city cannot modify, accounted for roughly
70% of operating revenues in 2016. However, the new 2017 tax
reforms are effectively decreasing tax brackets, and personal
income surtax is limited at 18%, implying the city's dependence
on the central government regarding taxation matters.

Difficult-to-cut personnel and goods and services expenses
represented 37% of Zagreb's operating expenditure in 2016,
limiting its expenditure flexibility. Furthermore, Zagreb
regularly reports payments of subsidies totaling about HRK700
million annually. Although, theoretically, the city has some
discretion to reduce subsidies, these costs are relatively
inflexible, particularly given the importance they hold for
Zagrebacki Holding.

Zagreb's capital program targets transportation infrastructure,
street renovations, and social service facilities. Capital
expenditures represent approximately 11%-12% of expenditures in
2017-2019 and we forecast they will average about HRK760 million
over that period (total of approximately HRK2.3 billion). This,
in turn, results in expected surpluses after capital accounts
decreasing to approximately 1.4% in 2019 from 2.7% in 2017 as
capital expenditures pick up in the later years of our forecast.
This is also in line with previous EU-program fund utilization
picking up toward the end of the cycle. The city is also
contemplating the possible next programming period, and its
better utilization, in conjunction with the central government.

The city's strong operating surpluses will help limit debt
accumulation over the coming years. S&P said, "We forecast
moderate debt intake, principally via Zagrebacki Holding, while
debt issued directly by the city is likely to reduce. In our
base-case scenario, we assume that the city's tax-supported debt,
which also includes debt of other municipal companies and
Zagrebacki Holding, will decrease to 89% in 2018 from 94% in
2016. In our view, this level of debt is comparably high relative
to that of peers in the region, but is generally neutral to
Zagreb's intrinsic creditworthiness, supported by high operating
margins. Direct debt, which includes the factoring deals the city
services on behalf of Zagrebacki Holding, is forecast to decrease
to about HRK2.2 billion in 2019 from around HRK2.4 billion in
2017 (around 35% of operating revenues). However, we cannot rule
out the possibility of an increase in debt, if operating balances
were to be under pressure and Zagreb needed liquidity.

"Zagreb's available liquidity remains limited, with the debt-
service coverage ratio just below 60% over the coming 12 months.
Zagreb's cash holdings average HRK240 million per month; we
factor into our assessment of maturing debt liabilities, loans,
factoring deals, and guarantee payments. Additionally, we view
access to external liquidity as limited, since Croatia's domestic
banking
sector is relatively weak; this is reflected in our assessment of
the banking sector (see "Banking Industry Country Risk
Assessment: Croatia," published Jan. 16, 2017, on RatingsDirect).

"In our view, Zagreb's contingent liabilities remain moderate. We
factor in Zagrebacki Holding's payables of HRK600 million as well
as the long-term and short-term debt of self-supporting entities
in analyzing the city's total exposure. The city also has an
ongoing legal case against the Ministry of Finance and previously
won a verdict relating to its overdue payables. Given that the
favorable decision effectively reduced the city's payables and
the city made a partial payment to suppliers, its payables now
stand at no more than 10% of operating revenues. We estimate that
the maximum loss under a stress scenario would be 10%-15% of
operating revenues."

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 (see 'Related Criteria And Research'). At
the onset of the committee, the chair confirmed that the
information provided to the Rating Committee by the primary
analyst had been distributed in a timely manner and was
sufficient for Committee members to make an informed decision.

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

The committee agreed that all key rating factors were unchanged.

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

RATINGS LIST

                                      Rating
                                 To              From
   Zagreb (City of)
   Issuer Credit Rating
  Foreign and Local Currency     BB/Stable/--    BB/Stable/--


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D E N M A R K
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NETS A/S: Moody's Puts Ba2 CFR Under Review for Downgrade
---------------------------------------------------------
Moody's Investors Service has placed under review for downgrade
the Ba2 corporate family rating (CFR) and Ba2-PD probability of
default rating (PDR) of Nets A/S (Nets or the company).
Concurrently, Moody's has assigned a definitive Ba2 instrument
rating on the EUR400 million senior unsecured notes due 2024
issued by Nassa Topco AS, a subsidiary of Nets A/S, and placed
the rating under review for downgrade.

On Sept. 25, 2017, Nets announced that Evergood 5 AS, a newly
formed company controlled by funds managed and advised by Hellman
& Friedman LLC (Hellman & Friedman) has agreed to make a
recommended voluntary takeover offer to acquire the company
valuing the latter's entire issued capital at DKK33.1 billion.
Hellman & Friedman is expected to own 70% of Evergood 5 AS with
the remaining shareholding split among a group of minority
investors, including GIC Private Limited, funds managed and/or
advised by Advent International Corporation, funds managed and/or
advised by Bain Capital Private Equity (Europe) LLP, Sampo PLC,
funds managed and advised by StepStone Group LP, and a fund
managed by Fisher Lynch Capital LLC.

RATINGS RATIONALE

Although specifics regarding the financing plan for the takeover
have not been made available by Evergood 5 AS, Moody's expects a
significant portion of the acquisition price will be funded with
debt as the acquisition vehicle will be controlled by a private
equity fund. Recently, Nets' adjusted gross leverage (as adjusted
by Moody's mainly for pensions, operating leases, deferred
considerations, and capitalized development costs) decreased to
approximately 4.9x as of the end of Q2 2017 from 5.7x as of
fiscal year end (FYE) 2016. A re-leveraging of the business under
private equity ownership could derail the de-leveraging
trajectory of the company -- Moody's previously stated that
downward pressure on Nets' Ba2 CFR could arise if, among others,
adjusted leverage does not decrease to below 4.5x and free cash
flow (FCF)-to-debt (excluding changes in clearing working
capital) remains below 10% on a sustained basis.

Moody's will conclude the review after the closing of the
transaction which is expected in Q1 2018 subject to customary
merger clearance and regulatory approvals and offer acceptance
from more than 90% of the share capital and voting right of Nets.
Nets' board of directors has recommended that shareholders accept
the offer, when made, and shareholders representing in total 46%
of the share capital of the company have already agreed to accept
the takeover offer. As part of the review Moody's will evaluate
the company's new ownership structure, financial policy, and
strategic objectives.

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

Headquartered in Copenhagen, Denmark, Nets is the largest pan-
Nordic payments processor focusing on Norway, Denmark, Finland,
and Sweden, and second largest in Europe. Nets generated revenues
of DKK7,385 million and EBITDA before special items (company
reported) of DKK2,619 million in FY 2016. Nets is present at
various points in the digital value payment chain by providing
the merchant solution, acquiring the transactions, clearing and
processing the transactions for issuers. In September 2016, Nets
A/S listed its share capital on the Nasdaq Copenhagen stock
exchange.


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SCFI RAHOITUSPALVELUT II: Fitch Affirms BB+ Rating on Cl. E Notes
-----------------------------------------------------------------
Fitch Ratings has upgraded SCFI Rahoituspalvelut Ltd's (SCFI)
class C, D and E notes, SCF Rahoituspalvelut I Designated
Activity Company's (SCF I DAC) class B notes and SCF
Rahoituspalvelut II Designated Activity Company's (SCF II DAC)
class B and D notes. Fitch affirmed the other notes.

SCFI, SCF I DAC and SCF II DAC are securitisations of auto loan
receivables originated to Finnish individuals and companies by
Santander Consumer Finance Oy (SCF Oy, the seller), a 100%
subsidiary of Norway-based Santander Consumer Bank AS (SCB, A-
/Stable/F2).

KEY RATING DRIVERS

The rating actions reflect that the underlying asset pools'
performance has been in line with or better than Fitch's
expectations. Credit enhancement has increased for all classes of
notes. Approximately 13%, 33% and 66% of the initial respective
SCFI, SCF I DAC and SCF II DAC transaction pools are currently
outstanding. The composition of the remaining pools has similar
characteristics to the initial pools. The proportion of balloon
loans has increased somewhat, but this is expected due to
amortisation and is reflected in Fitch's asset assumptions.

Fitch considered only the front-loaded standard 18 months
weighted average life (WAL) default vector for SCFI due to the
particularly short WAL of the transaction, as per its criteria.

Lower Than Expected Defaults
Fitch has revised the lifetime default base cases to 1.1%, 1.3%
and 1.5% for SCFI, SCF I DAC and SCF II DAC, respectively. These
are driven by the strong performance of all three transactions,
reflected by lower than expected defaults at the equivalent point
in time. The considerably lower default base case for SCFI is
also driven by the flattening of the cumulative defaults curve
and the low weighted average remaining life of the transaction.

Cumulative defaults to date are 1.0%, 0.7%, 0.3% for SCFI, SCF I
DAC and SCF II DAC, respectively. This performance is better than
Fitch's point in time expectation of defaults and long-term
delinquencies have also remained relatively stable

High Recoveries
The recoveries achieved by SCF Oy are among the highest for rated
European auto ABS, which is reflected in the 70% recovery base
case set for the transactions. Cumulative recoveries to date are
at 89%, 62%, 52% for SCFI, SCF I DAC and SCF II DAC,
respectively. These levels are either above (in the case of SCFI)
or consistent with Fitch's expectations given the time horizon
allowed for recoveries to take place.

Liquidity Coverage
Each transaction features a liquidity reserve, which provides
liquidity coverage for the class A and B notes. Class C and below
do not benefit from the reserve, which means timely payment of
interest on the notes may not be achieved in the case of a
servicing disruption, constraining their highest achievable
rating to 'A+sf'.

SCFI also includes a credit reserve, which flows through the
waterfall in each month and is available to cover liquidity
shortfalls for the class A-E notes and credit losses. Fitch
analysis shows the balance of the credit reserve would be
sufficient even under 'AAAsf' assumptions to cover timely
interest for the class C and D notes. The reserve cannot cover
timely interest for the class E notes in a 'AAsf' scenario. Hence
class E is capped at 'A+sf'.

RATING SENSITIVITIES

Rating sensitivities of SCFI
Expected impact upon the note rating of increased defaults (class
B/C/D/E):
Current ratings: 'AAAsf'/'AAAsf'/'AAAsf'/'A+sf'
Increase base case defaults by 25%: 'AAAsf'/'AAAsf'/'AAAsf'/'Asf'
Increase base case defaults by 50%: 'AAAsf'/'AAAsf'/'AAAsf'/'Asf'

Expected impact upon the note rating of reduced recoveries (class
B/C/D/E):
Current Ratings: 'AAAsf'/'AAAsf'/'AAAsf'/'A+sf'
Reduce base case recovery by 50%: 'AAAsf'/'AAAsf'/'AAAsf'/'A+sf'

Expected impact upon the note rating of increased defaults and
decreased recoveries (class B/C/D/E):
Current Ratings: 'AAAsf'/'AAAsf'/'AAAsf'/'A+sf'
Increase default base case by 25%; reduce recovery base case by
25%: 'AAAsf'/'AAAsf'/'AAAsf'/'Asf'
Increase default base case by 50%; reduce recovery base case by
50%: 'AAAsf'/'AAAsf'/'AAAsf'/'Asf'

Rating sensitivities of SCF I DAC
Expected impact upon the note rating of increased defaults (class
A/B/C/D/E):
Current ratings: 'AAAsf'/'AAAsf'/'A+sf'/'A+sf'/'BB+sf'
Increase base case defaults by 50%:
'AAAsf'/'AAAsf'/'A+sf'/'A+sf'/'BB+sf'

Expected impact upon the note rating of reduced recoveries (class
A/B/C/D/E):
Current ratings: 'AAAsf'/'AAAsf'/'A+sf'/'A+sf'/'BB+sf'
Reduce base case recovery by 50%:
'AAAsf'/'AAAsf'/'A+sf'/'A+sf'/'BB+sf'

Expected impact upon the note rating of increased defaults and
decreased recoveries (class A/B/C/D/E):
Current ratings: 'AAAsf'/'AAAsf'/'A+sf'/'A+sf'/'BB+sf'
Increase default base case by 50%; reduce recovery base case by
50%: 'AAAsf'/'AAAsf'/'A+sf'/'A+sf'/'BB+sf'

Rating sensitivities of SCF II DAC
Expected impact upon the note rating of increased defaults (class
A/B/C/D/E):
Current ratings: 'AAAsf'/'AA+sf'/'A+sf'/'A+sf'/'BB+sf'
Increase base case defaults by 25%:
'AAAsf'/'AAsf'/'A+sf'/'Asf'/'BB+sf'
Increase base case defaults by 50%: 'AAAsf'/'AA-sf'/'Asf'/'A-
sf'/'BB+sf'

Expected impact upon the note rating of reduced recoveries (class
A/B/C/D/E):
Current ratings: 'AAAsf'/'AA+sf'/'A+sf'/'A+sf'/'BB+sf'
Reduce base case recovery by 25%:
'AAAsf'/'AA+sf'/'A+sf'/'Asf'/'BB+sf'
Reduce base case recovery by 50%: 'AAAsf'/'AAsf'/'A+sf'/'A-
sf'/'BBsf'

Expected impact upon the note rating of increased defaults and
decreased recoveries (class A/B/C/D/E):
Current ratings: 'AAAsf'/'AA+sf'/'A+sf'/'A+sf'/'BB+sf'
Increase default base case by 10%; reduce recovery base case by
10%: 'AAAsf'/'AA+sf'/'A+sf'/'Asf'/'BB+sf'
Increase default base case by 25%; reduce recovery base case by
25%: 'AAAsf'/'AA-sf'/'Asf'/'BBB+sf'/'BBsf'
Increase default base case by 50%; reduce recovery base case by
50%: 'AA+sf'/'Asf'/'BBB+sf'/'BBB-sf'/'Bsf'

Fitch has taken the following rating actions:

SCFI Rahoituspalvelut Ltd
EUR34.9 million class B notes: affirmed at 'AAAsf'; Stable
Outlook
EUR6.7 million class C notes: upgraded to 'AAAsf' from 'A+sf';
Stable Outlook
EUR7.2 million class D notes: upgraded to 'AAAsf' from 'A+sf';
Stable Outlook
EUR8.2 million class E notes: upgraded to 'A+sf' from 'BB+sf';
Stable Outlook

SCF Rahoituspalvelut I DAC
EUR79.0 million class A notes: affirmed at 'AAAsf'; Stable
Outlook
EUR27.2 million class B notes: upgraded to 'AAAsf' from 'AA+sf';
Stable Outlook
EUR5.8 million class C notes: affirmed at 'A+sf'; Stable Outlook
EUR3.8 million class D notes: affirmed at 'A+sf'; Stable Outlook
EUR6.6 million class E notes: affirmed at 'BB+sf'; Stable Outlook

SCF Rahoituspalvelut II DAC
EUR337.0 million class A: affirmed at 'AAAsf'; Stable Outlook
EUR27.3 million class B: upgraded to 'AA+sf' from 'AAsf';
Positive Outlook
EUR9.1 million class C: affirmed at 'A+sf'; Stable Outlook
EUR6.1 million class D: upgraded to 'A+sf' from 'Asf'; Stable
Outlook
EUR10.3 million class E: affirmed at 'BB+sf'; Stable Outlook


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CGG SA: Creditors Accept Chapter 11 Bankruptcy Plan
---------------------------------------------------
Sudip Kar-Gupta at Reuters reports that the creditors of debt-
ridden oil services group CGG have accepted CGG's chapter 11
bankruptcy plan, CGG said on Oct. 2, in what could form one of
the biggest restructurings that France has seen in recent years.

According to Reuters, CGG has debt in excess of US$3 billion, and
the restructuring calls for unsecured debt to be converted to
equity, maturities on secured debt to be extended and US$500
million in new money to be raised.

CGG, in which the French state holds around 9% of the shares,
filed for bankruptcy in France and the United States in June as
part of a restructuring to ease its debt burden, Reuters
recounts.

                        About CGG Holding

Paris, France-based CGG Holding (U.S.) Inc. --
http://www.cgg.com/-- provides geological, geophysical and
reservoir capabilities to its broad base of customers primarily
from the global oil and gas industry.  Founded in 1931 as
"Compagnie Generale de Geophysique", CGG focuses on seismic
surveys and other techniques to help energy companies locate oil
and natural-gas reserves.  The company also makes geophysical
equipment under the Sercel brand name.

The Group has more than 50 locations worldwide, more than 30
separate data processing centers, and a workforce of more than
5,700, of whom more than 600 are solely devoted to research and
development.  CGG is listed on the Euronext Paris SA (ISIN:
0013181864) and the New York Stock Exchange (in the form of
American Depositary Shares, NYSE: CGG).

After a deal was reached key constituencies on a restructuring
that will eliminate $1.95 billion in debt, on June 14, 2017 (i)
CGG SA, the group parent company, opened a "sauvegarde"
proceeding, the French equivalent of a Chapter 11 bankruptcy
filing, (ii) 14 subsidiaries of CGG S.A. filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code
(Bankr. S.D.N.Y. Lead Case No. 17-11637) in New York, and (iii)
CGG S.A filed a petition under Chapter 15 of the U.S. Bankruptcy
Code (Bankr. S.D.N.Y. Case No. Case No. 17-11636) in New York,
seeking recognition in the U.S. of the Sauvegarde as a foreign
main proceeding.

Chapter 11 debtors CGG Canada Services Ltd. and Sercel Canada
Ltd. also commenced proceedings under the Companies' Creditors
Arrangement Act in the Court of Queen's Bench of Alberta,
Judicial District of Calgary in Calgary, Alberta, Canada, to seek
recognition of the Chapter 11 cases in Canada.

United States Bankruptcy Judge Martin Glenn oversees the Chapter
15 case.

CGG's legal advisors are Linklaters LLP and Weil Gotshal & Manges
(Paris) LLP for the Sauvegarde and Chapter 15 case.  The Debtors
hired Paul, Weiss, Rifkind, Wharton & Garrison LLP, as counsel.
The company's financial advisors are Lazard and Morgan Stanley,
and its restructuring advisor is AlixPartners, LLP.  Lazard
Freres & Co. LLC, serves as investment banker.  Prime Clerk LLC
is the claims agent in the Chapter 11 cases.

Messier Maris & Associes and Millco Advisors, LP, is the
financial advisors to the Ad Hoc Noteholder Group, and Willkie
Farr & Gallagher LLP and DLA Piper UK LLP, is legal counsel to
the Ad Hoc Noteholder Group.

Kirkland & Ellis LLP, Kirkland & Ellis International LLP, and De
Pardieu Brocas Maffei A.A.R.P.I, serve as counsel to the Ad Hoc
Secured Lender Committee; Zolfo Cooper LLC is the restructuring
advisor; and Rothschild & Co., is the investment banker.

Ashurst serves as counsel to Wilmington Trust (London) Limited as
successor agent to Natixis under the French Revolver.  Latham &
Watkins LLP, serves as counsel to Credit Suisse AG as
administrative agent and collateral agent under the U.S.
Revolver.
Ropes & Gray LLP, serves as counsel to Wilmington Trust, National
Association as administrative agent under the U.S. Term Loan.

Hogan Lovells U.S. LLP serves as counsel to the Indenture Trustee
in its separate capacities as indenture trustee under each of the
three series of High Yield Bonds.

Darrois Villey Maillot Brochier and A.M. Conseil represent JG
Capital Management, in its capacity as representative of the
holders of the Convertible Bonds.  Orrick Herrington & Sutcliffe
LLP represents counsel to DNCA.


SOCIETE GENERALE: Fitch Affirms BB+ Add'l. Tier 1 Capital Rating
----------------------------------------------------------------
Fitch Ratings has affirmed Societe Generale's (SG) Long-Term
Issuer Default Rating (IDR) at 'A', Short-Term IDR at 'F1' and
Viability Rating (VR) at 'a'. The Outlook is Stable.

At the same time, Fitch has upgraded SG's senior unsecured long-
term preferred debt to 'A+' from 'A' and SG's Derivative
Counterparty Rating (DCR) to 'A+(dcr)' from 'A(dcr)'. It has also
assigned SG deposit ratings of 'A+'/'F1'.

The upgrade reflects Fitch's view that the bank's qualifying
junior debt buffer (QJD) and senior non-preferred debt now is
sufficient to protect senior preferred creditors, which include
derivative counterparties and depositors, from default in case of
failure.

The rating actions have been taken in conjunction with Fitch's
periodic review of the Global Trading and Universal Banks
(GTUBs), which comprise 12 large and globally active banking
groups.

KEY RATING DRIVERS
IDRS, VR AND SENIOR DEBT+

SG's IDRs, VR and senior non-preferred debt ratings reflect
Fitch's view that the bank's sound company profile, which
benefits from franchise strengths across selected products and
geographies, has allowed SG to generate adequate profitability.
SG has a sound presence in domestic and international retail
banking and in providing financial services to corporates in
France and abroad. A sound corporate franchise in the eurozone
also benefits SG's securities business, where the bank has
leading positions in euro-denominated debt capital markets and
equity derivatives.

The ratings also reflect Fitch's view that the bank's asset
quality is weaker than its peers'. SG's gross impaired loan ratio
has improved to 5.3% at end-2Q17, from 7.7% at end-2013, but this
ratio remains higher than at most French and GTUB peers'. Fitch
expects the gross impaired loan ratio, which partly reflects
slower write-off practices in France, to fall further as asset
quality in a number of foreign businesses should improve further.

SG has continued to generate sound profitability, which in 2Q17
benefited from improved performance in international retail
banking, notably in Russia, amid more challenging conditions for
sales and trading and continued pressure on domestic retail
activities. In Fitch's opinion, further improving fee revenue in
French retail will be important for the bank to offset pressure
from low interest rates as net interest income in the business
decreased 7% yoy in 2Q17. International retail banking and
financial services are likely to remain the group's main earnings
driver as that division's pre-tax profit rose 34% yoy in 2Q17 and
contributed 44% of the operating divisions' pre-tax profit.

SG's capital ratios are at the lower end of GTUB peers', which in
Fitch's opinion is mitigated by the bank's strong internal
capital generation. The bank's fully-loaded CET1 ratio stood at
11.7% at end-2Q17 and fully-loaded Basel III leverage ratio was
4.2%. Regulatory capital ratios are largely in line with the
bank's end-2017 targets of an 11.5%-12% CET1 ratio and an 18%
total capital ratio. By end-2Q17, SG had issued EUR5.2 billion
senior non-preferred debt, a new debt class introduced in France
after a legislative change in December 2016, which in a
resolution ranks junior to other senior creditors and is eligible
for inclusion in total loss-absorbing capacity (TLAC).

The Stable Outlook reflects Fitch expectations that the bank will
continue generating sound profitability while progressing towards
its capital targets and gradually improving its asset quality
metrics.

SG's senior non-preferred debt, which is the reference liability
for the bank's IDRs, is rated in line with the IDRs.

Fitch has withdrawn ratings of six issues due to insufficient
information. These include three market-linked notes (ISINs
XS0408840253, XS0225888774 and XS0408839834) issued by Societe
Generale Acceptance N.V., two senior preferred notes (ISINs
XS0355766733 and XS0588952704) and a subordinated note (ISIN
FR0010482174) issued by Societe Generale S.A.

SUPPORT RATING AND SUPPORT RATING FLOOR

SG's Support Rating and Support Rating Floor reflect Fitch's view
that senior creditors cannot rely on receiving full extraordinary
support from the French sovereign in the event that the group
becomes non-viable. In Fitch's view, the EU's Bank Recovery and
Resolution Directive (BRRD) and the Single Resolution Mechanism
(SRM) provide a framework for resolving banks that is likely to
require senior creditors participating in losses, if necessary,
instead of or ahead of a bank receiving sovereign support.

DERIVATIVE COUNTERPARTY RATING, DEPOSIT RATINGS AND SENIOR
PREFERRED DEBT

SG's DCR and long-term senior preferred debt and deposit ratings
are one notch above the bank's Long-Term IDR because derivatives,
deposits and structured notes have preferential status over the
bank's large buffer of QJD and senior non-preferred debt. Short-
term deposits, rated at 'F1', are at the lower of the two short-
term ratings that map to the long-term deposit rating as there is
no clear liquidity enhancement at instrument level.

Rated senior debt issued by Societe Generale Acceptance N.V., SG
Option Europe and SG Structured Products Inc., which benefits
from a guarantee from SG, is rated in line with SG's senior
preferred debt because Fitch expects the guaranteed notes to
benefit from the protection provided by the buffer of QJD and
senior non-preferred debt.

Fitch estimates that SG's buffer of QJD and senior non-preferred
debt at end-1H17 was equal to about 8.2% of risk-weighted assets
(RWA), which Fitch expects to be sufficient to recapitalise the
bank after a resolution without causing losses to senior
preferred creditors. Fitch expects the bank to issue further
senior non-preferred debt, which should result in a further
increase of the buffer, and which Fitch views as sustainable
since SG will have to meet TLAC requirements.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other hybrid securities issued by SG are
all notched down from its VR in accordance with Fitch's
assessment of each instrument's respective non-performance and
relative loss severity risk profiles, which vary considerably.

Subordinated Tier 2 debt is rated one notch below the VR for loss
severity, reflecting below-average recoveries.

Additional Tier 1 instruments are rated five notches below the
VR. The issues are notched down twice for loss severity,
reflecting poor recoveries as the instruments can be written down
well ahead of resolution. In addition, they are notched down
three times for very high non-performance risk due to fully
discretionary coupon omission.

Legacy Tier 1 securities are rated four notches below the VR,
comprising two notches for higher-than-average loss severity, and
two further notches for non-performance risk due to partly
discretionary coupon omission.

SUBSIDIARY AND AFFILIATED COMPANY

The Long- and Short-Term IDRs and Support Rating of SG's French
specialist car financing subsidiary, Compagnie Generale de
Location d'Equipement, are based on institutional support from
SG. The subsidiary is rated using Fitch's Global Non-Bank
Financial Institutions Criteria. Compagnie Generale de Location
d'Equipements' Long-and Short-Term IDRs are equalised with those
of SG and the subsidiary's Outlooks are the same as the parent's.
This is because Fitch views this entity as a core subsidiary
given its importance to and integration with its parent.

RATING SENSITIVITIES
IDRS, VR AND SENIOR NON-PREFERRED DEBT

SG's IDRs, VR and senior non-preferred debt ratings would come
under pressure if the bank's internal capital generation weakens
from deterioration of earnings. Ratings would also come under
pressure if gross impaired loans increase, or if the bank
increases its risk appetite. Although currently not expected,
outsized losses resulting from legal or misconduct cases that
would materially dent capital would also be rating-negative.

Upside to the ratings is currently limited and would require a
material improvement in asset quality while maintaining
sustainable earnings, sound capitalisation and an unchanged risk
appetite.

SUPPORT RATING AND SUPPORT RATING FLOOR

An upgrade of SG's Support Rating and upward revision to the
Support Rating Floor would be contingent on a positive change in
the sovereign's propensity to support its banks. While not
impossible, this is highly unlikely in Fitch's view.

DERIVATIVE COUNTERPARTY RATING, DEPOSIT RATINGS AND SENIOR
PREFERRED DEBT

SG's DCR and long-term senior preferred debt and deposit ratings
are notched from the bank's IDR and are therefore primarily
sensitive to changes to the Long-Term IDR. The ratings would no
longer be rated one notch above the Long-Term IDR if the buffer
of QJD and senior non-preferred debt falls to below the expected
recapitalisation amount of about 8%, which Fitch does not expects
because the bank will have to meet minimum TLAC requirements.

Societe Generale Acceptance N.V.'s, SG Option Europe's and SG
Structured Products Inc.'s senior debt ratings are sensitive to
the same factors that drive a change in SG's senior preferred
debt rating.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other hybrid capital ratings are primarily
sensitive to a change in SG's VR. The securities' ratings are
also sensitive to a change in their notching, which could arise
if Fitch changes its assessment of the probability of their non-
performance relative to the risk captured in the respective
issuers' VRs. This may reflect a change in capital management in
the group or an unexpected shift in regulatory buffer
requirements, for example. The ratings are also sensitive to a
change in Fitch's assessment of each instrument's loss severity,
which could reflect a change in the expected treatment of
liability classes during a resolution.

SUBSIDIARY AND AFFILIATED COMPANY

The ratings of Compagnie Generale de Location d'Equipements are
sensitive to changes in SG's IDRs and could also be sensitive to
changes in the subsidiary's strategic importance to the rest of
the group.

The rating actions are:

Societe Generale
Long-Term IDR affirmed at 'A'; Outlook Stable
Short-Term IDR affirmed at 'F1'
Viability Rating affirmed at 'a'
Support Rating affirmed at '5'
Support Rating Floor affirmed at 'No Floor'
Derivative Counterparty Rating upgraded to 'A+(dcr)' from
'A(dcr)'
Senior non-preferred debt affirmed at 'A'
Senior preferred debt long-term rating upgraded to 'A+' from 'A'
and short-term rating affirmed at 'F1'
Senior preferred notes XS0355766733 and XS0588952704 withdrawn
Long-term deposit rating assigned at 'A+'
Short-term deposit rating assigned at 'F1'
Market-linked securities upgraded to 'A+emr' from 'Aemr'
Lower Tier 2 notes affirmed at 'A-'
Subordinated note FR0010482174 withdrawn
Additional Tier 1 capital affirmed at 'BB+'

Societe Generale Acceptance N.V.
Market-linked guaranteed notes upgraded to 'A+emr' from 'Aemr'
Market-linked notes XS0408840253, XS0225888774 and XS0408839834
withdrawn
Senior preferred guaranteed notes upgraded to 'A+' from 'A'
Short-term guaranteed notes affirmed at 'F1'

SG Option Europe
Senior preferred long-term programme rating upgraded to 'A+' from
'A' and senior preferred short-term programme rating affirmed at
'F1'

SG Structured Products Inc.
Senior preferred guaranteed notes upgraded to 'A+' from 'A'

Compagnie Generale de Location d'Equipements
Long-Term IDR affirmed at 'A'; Outlook Stable
Short-Term IDR affirmed at 'F1'
Support Rating affirmed at '1'
Certificate of deposit programme affirmed at 'F1'


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


DEUTSCHE BANK: Fitch Cuts Additional Tier 1 Notes Rating to BB-
---------------------------------------------------------------
Fitch Ratings has downgraded Deutsche Bank AG's (Deutsche Bank)
Long-Term Issuer Default Rating (IDR) to 'BBB+' from 'A-' and
Short-Term IDR to 'F2' from 'F1'. The Outlook on the Long-Term
IDR is Stable. At the same time, Fitch has downgraded the bank's
Viability Rating (VR) to 'bbb+' from 'a-'. All debt and deposit
ratings have also been downgraded by one notch.

The rating actions have been taken in conjunction with Fitch's
periodic review of the Global Trading and Universal Banks (GTUB),
which comprises 12 large and globally active banking groups.

KEY RATING DRIVERS
IDRS, VR, DCR, DEPOSIT AND SENIOR DEBT RATINGS
DEUTSCHE BANK

The downgrades reflect continued pressure on Deutsche Bank's
earnings, combined with prolonged implementation of its strategy.
Fitch no longer expects revenue to demonstrate any clear signs of
franchise recovery this year and Fitch expects necessary further
restructuring costs to continue to erode net income. Deutsche
Bank's strategic restructuring came later than those of most of
its GTUB peers'. In addition, the scale and scope of what it has
to do plus strategic revisions earlier this year mean that
Deutsche Bank has further to go to complete its business
restructuring than any of the other GTUBs.

Consequently, Fitch expects it to take some time before the bank
will be able to deliver on earnings targets, including a post-tax
return on tangible equity (RoTE) of around 10% in a more
supportive interest rate environment.

Revenue is suffering from low capital market volatility combined
with persistently low interest rates, particularly in Europe,
where the bank is strongest. Franchise erosion in capital
markets, notably in prime services, in 4Q16 has been reversed to
some extent, but it will take time for client demand to return
fully in light of intense competition and due to subdued client
trading activity given low market volatility. Fitch expects
additional restructuring costs from the integration of Deutsche
Postbank AG (Postbank) and from further necessary expenses on IT
systems.

Positively for the ratings, capitalisation was boosted by the
bank's rights issue in April, and the planned IPO of a minority
stake in its asset management division together with further
asset disposals during the next 12-18 months gives it flexibility
to add a further EUR2 billion to common equity. Deutsche Bank's
end-June 2017 fully loaded Common Equity Tier 1 (CET1) ratio was
14.1%, and the bank's leverage ratio was 3.8%, with management
targeting to maintain the CET1 ratio "comfortably above" 13% and
achieve a leverage ratio of 4.5%.

The strategic reorientation announced in March towards a more
balanced universal banking business model should improve earnings
stability, but Fitch will look for evidence that that it can
achieve healthy profitability out of its large domestic deposit
base, and that it can draw on its franchise strengths of a solid
German private and corporate customer base extended to global
corporate banking and debt capital markets solutions.

Despite notable widening of spreads on unsecured market funding
in 2016 and some institutional deposit outflows in 4Q16, Fitch
believes that Deutsche Bank retains strong, well-diversified
funding by geography, product and customer, and maintains ample
liquidity. It reported liquidity reserves of EUR285 billion as at
end-June 2017, a large proportion of which were in cash or
deposits with major central banks.

The downgrades of Deutsche Bank's Short-Term IDR and short-term
debt ratings to 'F2' reflect mapping to a 'BBB+' Long-Term IDR on
Fitch ratings scales.

Deutsche Bank's Derivative Counterparty Rating (DCR) and long-
term deposit and preferred senior debt ratings are one notch
above the IDR because derivatives, deposits and structured notes
have preferential status over the bank's large buffer of
qualifying junior debt and statutorily subordinated senior debt.
The short-term deposit and preferred senior debt ratings have
been downgraded to 'F2' to match the downgrade of the long-term
ratings to 'A-', which is the lower of the two short-term ratings
as there are no clear liquidity enhancements at instrument level.

IDRs, SUPPORT RATINGS, DCRs, DEPOSIT AND SENIOR DEBT RATINGS
DEUTSCHE BANK AG, LONDON BRANCH AND SUBSIDIARIES

The IDRs and debt ratings of Deutsche Bank AG, London branch, of
Postbank and of Deutsche Bank's subsidiaries in the US and
Australia are equalised with Deutsche Bank's to reflect their
core roles within the group, especially Deutsche Bank's capital
markets activities, and their high integration with the parent
bank or their role as issuing vehicles. The downgrades of the
subsidiaries' Support Ratings (SR) to '2' from '1' reflect Fitch
views of the reduced ability of the parent to support its
subsidiaries signalled by the downgrade of its IDRs.

Deutsche Bank AG, London branch's DCR and long-term deposit and
preferred senior debt ratings benefit from the same one-notch
uplift above the IDR given to equivalent ratings at Deutsche
Bank, as Fitch believes that the insolvency hierarchy is most
likely to follow the incorporation of the legal entity rather
than where the branch is located. In contrast, Fitch has not
given uplift to Deutsche Bank Securities' DCR, which is at the
same level as the entity's Long-Term IDR.

Postbank's long-term deposit rating is equalised with the
issuer's Long-Term IDR because Postbank does not have a
sufficient qualifying subordinated and non-preferred senior debt
buffer at entity level to provide a buffer above these in
resolution. It has been placed on Rating Watch Positive to
reflect Fitch views that once it is merged with Deutsche Bank's
retail banking subsidiary, Fitch believes that the large buffer
of qualifying junior debt and statutorily subordinated senior
debt at Deutsche Bank would be available to protect depositors in
its core domestic retail bank subsidiary in a resolution
scenario.

The rating of the guaranteed notes issued by the former DSL Bank
(which was merged into Postbank) reflects their grandfathered
deficiency guarantee from Germany (AAA/Stable). The notes are
rated two notches below the guarantor's Long-Term IDR as Fitch
sees some uncertainty around the timeliness of payments under the
guarantee given its deficiency language, but the uncertainty is
small due to the high reputational risk Germany would face if
debtholders incurred losses.

SUPPORT RATINGS AND SUPPORT RATING FLOOR
DEUTSCHE BANK

Deutsche Bank's SR of '5' and Support Rating Floor (SRF) of 'No
Floor' reflect Fitch views that senior creditors cannot rely on
receiving full extraordinary support from the sovereign in the
event that it becomes non-viable.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
DEUTSCHE BANK AND SUBSIDIARIES

Subordinated debt and other hybrid capital instruments issued by
Deutsche Bank and its subsidiaries are all notched down from
Deutsche Bank's VR in accordance with Fitch assessments of each
instrument's respective non-performance and relative loss
severity risk profiles, and have been downgraded by one notch
accordingly.

Legacy Tier 1 securities issued by Deutsche Bank Contingent
Capital Trust II, III, IV and V and by Deutsche Postbank Funding
Trust I, II and III are rated four notches below Deutsche Bank's
VR, reflecting higher-than-average loss severity (two notches),
as well as high risk of non-performance (an additional two
notches) given partial discretionary coupon omission.

High and low trigger contingent additional Tier 1 (AT1) capital
instruments are rated five notches below the VR. The issues are
notched down twice for loss severity, reflecting poor recoveries
as the instruments can be converted to equity or written down
well ahead of resolution. In addition, they are notched down
three times for high non-performance risk, reflecting fully
discretionary coupon omission.

Available distributable items (ADIs) referenced for AT1
securities are calculated annually under German GAAP for the
parent bank and reference primarily cumulative retained earnings.
Despite earnings weaknesses, Fitch does not expects cumulative
retained earnings to fall below a sufficient level to pay AT1
securities in the foreseeable future. The bank has remained
current on payment of AT1 coupons to date. Non-payment of AT1
coupon would also be triggered by any breach of the bank's
maximum distributable amount (MDA) requirement, which stands at
9.52% for 2017, combining CET1 and the Pillar 2 add-on
requirement resulting from the ECB's Supervisory Review and
Evaluation Process (SREP). Deutsche Bank has a substantial buffer
above this threshold (its end-June 2017 phased-in CET1 ratio was
14.86%).

RATING SENSITIVITIES
IDRs, VR, DCR, DEPOSIT AND SENIOR DEBT RATINGS
DEUTSCHE BANK

Successful completion of Deutsche Bank's restructuring together
with sustainable improvement in earnings could result in an
upgrade of the ratings provided risk appetite does not increase
or the bank's liquidity profile does not weaken significantly to
achieve this. This would demonstrate franchise improvement and
would likely require higher market share in targeted markets.

Given the rating level, Fitch does not expects a further
downgrade of the ratings unless implementation of the strategic
plan meets notable setbacks, particularly around the integration
of Postbank. New, substantial litigation or restructuring costs
that prevent the bank from retaining capitalisation on target
would also be negative for the ratings.

Deutsche Bank's DCRs, deposit and debt ratings are primarily
sensitive to changes in the Long-Term IDR. In addition, Deutsche
Bank's DCRs, deposit rating and senior preferred debt ratings are
sensitive to the amount of subordinated and non-preferred senior
debt buffers relative to the recapitalisation amount likely to be
needed to restore viability and prevent default on more senior
derivative obligations, deposits and structured notes.

IDRs, SUPPORT RATINGS, DCRs, DEPOSIT AND SENIOR DEBT RATINGS
DEUTSCHE BANK AG, LONDON BRANCH AND SUBSIDIARIES

Deutsche Bank subsidiaries' ratings reflect the parent bank's and
the ratings would move in line with Deutsche Bank's. They are
further sensitive to changes in Fitch assumptions around the
propensity of Deutsche Bank to provide timely support. Assuming
no change in the propensity to provide support, an upgrade of
Deutsche Bank would result in an upgrade of its subsidiaries'
SRs.

Fitch expects to upgrade the long-term deposit rating of
Postbank's successor legal entity to 'A-' following its merger.

The rating of the guaranteed notes issued by the former DSL Bank
is primarily sensitive to a downgrade of Germany's Long-Term IDR.

SR AND SRF
DEUTSCHE BANK

An upgrade of Deutsche Bank's SR and upward revision of the SRF
would be contingent on a positive change in the sovereign's
propensity to support banks' senior creditors in full. While not
impossible, this is highly unlikely, in Fitch views.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
DEUTSCHE BANK AND SUBSIDIARIES

Subordinated debt and other hybrid securities are primarily
sensitive to a change in Deutsche Bank's VR. The securities'
ratings are also sensitive to a change in their notching, which
could arise if Fitch changes its assessment of the probability of
their non-performance relative to the risk captured in the
respective issuers' VRs. This may reflect a change in capital
management in the group or an unexpected shift in regulatory
buffer requirements, for example.

For AT1 instruments, non-performance risk could increase and the
instruments notched further from the VR if ADI reduce
significantly or if the MDA buffer tightens considerably as a
result of a heightened Pillar 2 binding requirement or CET1
erosion from losses.

The rating actions are:

Deutsche Bank AG
Long-Term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable
Short-Term IDR downgraded to 'F2' from 'F1'
Viability Rating downgraded to 'bbb+' from 'a-'
Support Rating affirmed at '5'
Support Rating Floor affirmed at 'No Floor'
Derivative Counterparty Rating downgraded to 'A-(dcr)' from
'A(dcr)'
Deposit ratings: downgraded to 'A-'/'F2' from 'A'/'F1'
Senior preferred debt ratings downgraded to 'A-' from 'A'
Senior non-preferred debt and senior unsecured programme ratings
downgraded to 'BBB+'/'F2' from 'A-'/'F1'
Senior market-linked securities downgraded to 'A-(emr)' from
'A(emr)'
Subordinated lower Tier II debt downgraded to 'BBB' from 'BBB+'
Additional Tier 1 notes downgraded to 'BB-' from 'BB'

Deutsche Bank AG, London Branch
Long-Term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable
Short-Term IDR downgraded to 'F2' from 'F1'
Derivative Counterparty Rating downgraded to 'A-(dcr)' from
'A(dcr)'
Deposit ratings downgraded to 'A-'/'F2' from 'A'/'F1'
Senior preferred debt ratings downgraded to 'A-' from 'A'
Senior non-preferred debt ratings and commercial paper downgraded
to 'BBB+'/'F2' from 'A-'/'F1'
Senior market-linked securities: downgraded to 'A-(emr)' from
'A(emr)'
Subordinated market-linked securities: downgraded to 'BBB(emr)'
from 'BBB+(emr)'

Deutsche Postbank AG
Long-Term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable
Short-Term IDR downgraded to 'F2' from 'F1'
Support Rating downgraded to '2' from '1'
Long-term deposit rating downgraded to 'BBB+' from 'A-', placed
on Rating Watch Positive
Short-term deposit rating downgraded to 'F2' from 'F1'
Senior debt issuance programme ratings, including ECP, downgraded
to 'BBB+'/'F2' from 'A-'/'F1'
Guaranteed senior unsecured bonds issued by the former DSL Bank
affirmed at 'AA'

Deutsche Bank Securities, Inc.
Long-Term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable
Short-Term IDR downgraded to 'F2' from 'F1'
Support Rating downgraded to '2' from '1'
Derivative Counterparty Rating downgraded to 'BBB+(dcr)' from 'A-
(dcr)'

Deutsche Bank Trust Company Americas
Long-Term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable
Short-Term IDR downgraded to 'F2' from 'F1'
Support Rating downgraded to '2' from '1'
Senior debt ratings downgraded to 'F2' from 'F1'

Deutsche Bank Trust Corporation
Long-Term IDR downgraded to 'BBB+' from 'A-'; Outlook Stable
Short-Term IDR downgraded to 'F2' from 'F1'
Support Rating downgraded to '2' from '1'
Senior programme ratings downgraded to 'BBB+'/'F2' from 'A-'/'F1'

Deutsche Bank Australia Ltd.
Commercial paper short-term rating downgraded to 'F2' from 'F1'

Deutsche Bank Contingent Capital Trust II, III, IV and V
Preferred securities ratings downgraded to 'BB' from 'BB+'

Deutsche Postbank Funding Trust I, II and III
Preferred securities ratings downgraded to 'BB' from 'BB+'


=============
I R E L A N D
=============


HARVEST CLO XII: Fitch Rates EUR13MM Class F-R Notes 'B-(EXP)'
--------------------------------------------------------------
Fitch Ratings has assigned Harvest CLO XII DAC refinancing notes
expected ratings:

EUR239 million class A-1R notes: assigned 'AAA(EXP)sf'; Outlook
Stable
EUR40.8 million class B-1R notes: assigned 'AA(EXP)sf'; Outlook
Stable
EUR10 million class B-2R notes: assigned 'AA(EXP)sf'; Outlook
Stable
EUR23.75 million class C-R notes: assigned 'A(EXP)sf'; Outlook
Stable
EUR21.4 million class D-R notes: assigned 'BBB(EXP)sf'; Outlook
Stable
EUR26.3 million class E-R notes: assigned 'BB(EXP)sf'; Outlook
Stable
EUR13 million class F-R notes: assigned 'B-(EXP)sf'; Outlook
Stable

The proceeds of this issuance will be used to redeem the old
notes, with a new identified portfolio comprising the existing
portfolio, as modified by sales and purchases conducted by the
manager. The transaction closed in August 2015 and the portfolio
is managed by Investcorp Credit Management EU Limited. The
refinanced CLO envisages a further four-year reinvestment period
and an 8.5-year weighted average life (WAL).

The assignment of the final ratings is contingent on the receipt
of final documents conforming to information already received.

KEY RATING DRIVERS
'B' Portfolio Credit Quality
Fitch assesses the average credit quality of obligors to be in
the 'B' category. The Fitch weighted average rating factor (WARF)
of the current portfolio is 33.1, below the initial indicative
maximum covenanted WARF of 33.5.

High Recovery Expectations
At least 90% of the portfolio will comprise senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch weighted average recovery rate of the current
portfolio is 64.7%, above the initial indicative minimum covenant
of 61.6%.

Limited Interest Rate Exposure
Up to 5% of the portfolio can be invested in fixed-rate assets,
while fixed-rate liabilities represent 2.4% of the target par.
Fitch modelled both 0% and 5% fixed-rate buckets and found that
the rated notes can withstand the interest rate mismatch
associated with each scenario.

Diversified Asset Portfolio
The covenanted maximum exposure to the top 10 obligors is 20% of
the portfolio balance. This covenant ensures that the asset
portfolio will not be exposed to excessive obligor concentration.

RATING SENSITIVITIES

A 125% default multiplier applied to the portfolio's mean default
rate, and with this increase added to all rating default levels,
would lead to a downgrade of up to two notches for the rated
notes.

A 150% default multiplier applied to the portfolio's mean default
rate, and with this increase added to all rating default levels,
would lead to a downgrade of up to five notches for the rated
notes.

A 25% reduction in recovery rates would lead to a downgrade of up
to two notches for the rated notes.

A 50% reduction in recovery rates would lead to a downgrade of up
to five notches for the rated notes.

A combined stress of default multiplier of 125% and recovery rate
multiplier of 75% would lead to a downgrade of up to five notches
for the rated notes.


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


SUNRISE SPV 20: Moody's Assigns (P)B1 Rating to Class E Notes
-------------------------------------------------------------
Moody's Investors Service has assigned provisional long-term
credit ratings to the ABS notes to be issued by Sunrise SPV 20
S.r.l.(the "Issuer") as detailed below:

-- EUR[.]M Class A Limited Recourse Consumer Loans Backed
    Floating Rate Notes due November 2041, Assigned (P) Aa2 (sf)

-- EUR[.]M Class B Limited Recourse Consumer Loans Backed Fixed
    Rate Notes due November 2041, Assigned (P) A1 (sf)

-- EUR[.]M Class C Limited Recourse Consumer Loans Backed Fixed
    Rate Notes due November 2041, Assigned (P) Baa2 (sf)

-- EUR[.]M Class D Limited Recourse Consumer Loans Backed Fixed
    Rate Notes due November 2041, Assigned (P) Ba2 (sf)

-- EUR[.]M Class E Limited Recourse Consumer Loans Backed Fixed
    Rate Notes due November 2041, Assigned (P) B1 (sf)

Moody's has not assigned any rating to the EUR[.]M Class M1
Asset-Backed Fixed Rate Notes due November 2041 and Class M2
Asset-Backed Fixed Rate and Variable Return Notes due November
2041.

This transaction represents the second public securitisation
transaction rated by Moody's backed by Italian consumer loans
originated by Agos Ducato S.p.A. ("Agos", unrated), a leading
consumer finance company in Italy. The assets supporting the
notes, which amount to EUR[895.0] million, consist of consumer
loans extended to individuals resident in Italy. All loans pay a
fixed rate of interest until maturity, are fully amortising
without any balloon payment and must have paid a minimum of two
scheduled installments prior to their sale to the portfolio.

Agos also acts as the servicer of the portfolio during the life
of the transaction. In addition, Zenith Service S.p.A. (unrated),
the back-up servicer facilitator, will facilitate the search for
a substitute servicer upon termination of the servicer's mandate.
In case the servicer report is not available at any payment date,
continuity of payments for the rated notes will be assured by the
calculation agent, Credit Agricole Corporate and Investment Bank
(Aa3(cr)/P-1(cr); A1/P-1), acting through its Milan branch, based
on estimates.

RATINGS RATIONALE

The ratings of the notes are based on an analysis of the
characteristics of the underlying pool of consumer loans, sector
wide and originator specific performance data, protection
provided by credit enhancement, the cash reserves, the roles of
external counterparties and the structural integrity of the
transaction.

Moody's notes that the transaction benefits from credit strengths
such as: (i) the granular portfolio composition and good
geographical diversification; (ii) the fact that all loans pay a
fixed rate of interest until maturity and are fully amortising
without any balloon payments; and (iv) the good historical
performance data with regards to defaults and arrears provided by
the originator.

In addition, the transaction provides certain structural features
such as: (i) a cash reserve equal to [0.50]% of the initial pool,
increasing to [3]% during the revolving period and amortising to
[3]% of the outstanding pool thereafter (subject to the floor of
[0.50]% of the initial portfolio). The cash reserve will provide
both liquidity and principal loss coverage for the rated notes;
(ii) additional source of liquidity provided by the payment
interruption risk reserve and the principal to pay interest
mechanism for the rated notes; (iii) a commingling reserve which,
together with the daily sweep of collections to the Issuer
account, will mitigate the risk of commingling; (iv) a fixed-
floating interest rate swap hedging the fixed-floating mismatch
stemming from the Class A notes paying a floating rate of
interest and the portfolio made of fixed rate loans.

Moody's notes that the transaction also features some credit
weaknesses such as: (i) the fact that the pool is revolving for
the initial 12 months which could lead to an asset quality drift
although this is mitigated to some extent by the portfolio
concentration limits; (ii) the weighted-average asset yield can
decrease to [6.80]% during the revolving period and this has been
considered in the cash flow modelling of the transaction; and
(iii) [75]% of the pool comprises personal loans which
historically exhibited higher default rates than other consumer
loan products.

MAIN MODEL ASSUMPTIONS

Moody's determined the portfolio lifetime expected defaults of
[7.5]%, Aa2 portfolio credit enhancement ("PCE") of [18]% and
mean recoveries of [10]%. The expected defaults and recoveries
captures Moody's expectations of performance considering the
current economic outlook, while the PCE captures the loss Moody's
expects the portfolio to suffer in the event of a severe
recession scenario. Expected defaults, recoveries and PCE are
parameters used by Moody's to calibrate its lognormal portfolio
loss distribution curve and to associate a probability with each
potential future loss scenario in its ABSROM cash flow model used
to rate consumer ABS transactions.

Portfolio expected defaults of [7.5]% are in line with the EMEA
ABS Consumer sector average, and are based on Moody's assessment
of the lifetime expectation for the pool taking into account (i)
the historical default rates of the originator's loan book split
by new and used vehicles, furniture loans, personal loans and
other special purpose loans; (ii) benchmarking with other similar
transactions; and (iii) the fact that the transaction is
revolving for 12 months and the portfolio concentration limits
during that period.

Portfolio expected recoveries of [10]% are in line with the EMEA
ABS Consumer sector average and it takes into account (i) the
historical recovery rates from the originator's loan book split
by new and used vehicles, furniture loans, personal loans and
other special purpose loans; (ii) the unsecured nature of the
consumer loans in Italy; and (iii) benchmarking with other
similar transactions.

The PCE of [18]% is in line with the EMEA ABS Consumer sector
average and is based on Moody's assessment of the pool taking
into account (i) the proportion of personal loans in the initial
pool and allowed according to the concentration criteria; (ii)
the historical performance of the assets; (iii) prior Agos
consumer loan securitisations performance during a weak economic
period; and (iv) benchmarking with other similar transactions.
The PCE of [18]% coupled with Moody's mean expected default and
recovery assumptions results in an implied coefficient of
variation ("CoV") of [35.4]%.

METHODOLOGY

The principal methodology used in these ratings was "Moody's
Approach to Rating Consumer Loan-Backed ABS" published in
September 2015.

The provisional ratings address the expected loss posed to
investors by the legal final maturity of the notes. In Moody's
opinion, the structure allows for timely payment of interest and
ultimate payment of principal with respect to the Class A, B, C,
D and E notes by the legal final maturity. Moody's issues
provisional ratings in advance of the final sale of securities,
but these ratings represent only Moody's preliminary credit
opinions. Upon a conclusive review of the transaction and
associated documentation, Moody's will endeavour to assign
definitive ratings to the notes. A definitive rating may differ
from a provisional rating. Moody's provisional ratings address
only the credit risk associated with the transaction. Other non-
credit risks have not been addressed, but may have significant
effect on yield to investors.

FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE
RATINGS:

Factors that may lead to and upgrade of the ratings of the notes
include significantly better than expected performance of the
pool and an increase in credit enhancement of the notes due to
deleveraging.

Factors that may lead to a downgrade of the ratings of the notes
include (i) a decline in the overall performance of the pool and
(ii) a significant deterioration of the credit profile of the
originator/servicer, the swap counterparty or other key
transaction counterparties.

Finally, unforeseen regulatory changes or significant changes in
the legal environment may also result in changes of the ratings.

LOSS AND CASH FLOW ANALYSIS:

Moody's uses its cash flow model ABSROM as part of its
quantitative analysis of the transaction. Moody's ABSROM model
enables users to model various features of a standard European
ABS transaction -- including the specifics of the loss
distribution of the assets, their portfolio amortisation profile,
yield as well as the specific priority of payments, hedging and
cash reserves on the liability side of the ABS structure.

STRESS SCENARIOS:

In rating consumer loan ABS, default rate and recovery rate are
two key inputs that determine the transaction cash flows in the
cash flows model.

If the expected default rate increased to [8.5]% from [7.5]% and
the recovery rate decreased to [7.5]% from [10]% the model output
indicates that the Class A and B notes would still achieve
Aa2(sf) and A1 (sf), respectively, assuming that all other
factors remained unchanged. Moody's Parameter Sensitivities
provide a quantitative/model-indicated calculation of the number
of rating notches that a Moody's structured finance security may
vary if certain input parameters used in the initial rating
process differed. The analysis assumes that the deal has not aged
and is not intended to measure how the rating of the security
might migrate over time, but rather how the initial rating of the
security might have differed if key rating input parameters were
varied. Parameter Sensitivities for the typical EMEA ABS Consumer
Loan transaction are calculated by stressing key variable inputs
in Moody's cash flow model.


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


ABN AMRO: Fitch Rates EUR1BB Additional Tier 1 Notes BB+
--------------------------------------------------------
Fitch Ratings has assigned ABN AMRO Bank N.V.'s (A+/Stable/a)
EUR1 billion additional Tier 1 (AT1) notes a final long-term
rating of 'BB+'. The notes pay a semi annual fixed coupon of
4.75% in the first 10 years.

KEY RATING DRIVERS

The notes are CRD IV-compliant undated, deeply subordinated,
fixed-rate resettable AT1 debt securities. The notes have fully
discretionary non-cumulative coupon payments and are subject to
partial or full write-down if ABN AMRO Group's consolidated
common equity Tier 1 (CET1) ratio falls below 7% or ABN AMRO
Bank's standalone CET1 ratio falls below 5.125%. The write-down
could be reversed under certain conditions and at the discretion
of the bank.

The rating is five notches below ABN AMRO Bank's Viability Rating
(VR) of 'a'. This reflects two notches for loss severity in light
of the notes' deep subordination and three notches for additional
non-performance risk relative to the VR given a high write-down
trigger and fully discretionary coupons.

Fitch expects the non-payment of interest on this instrument will
occur when the bank's CET1 ratio approaches its Supervisory
Review and Evaluation Process requirement set at 9% for 2017. ABN
AMRO Group's consolidated phased-in CET1 ratio (where the 7%
conversion trigger applies) was 17.7% (fully-loaded CET1 ratio of
17.6%) at end-June 2017. Given ABN AMRO's group's solid capital
ratios, which provide a buffer over the conversion and the
expected coupon omission triggers, and Fitch's expectations for
their evolution, Fitch has limited the notching for non-
performance to three notches.

RATING SENSITIVITIES

The rating of the notes is sensitive to changes of ABN AMRO
Bank's VR. The latter is sensitive to a material deterioration in
the bank's earnings generation or asset quality, affecting its
capital or access to/cost of wholesale funding. The notes' rating
is also sensitive to changes in Fitch's assessment of their non-
performance risk relative to that captured in the bank's VR.

Date of the relevant committee: February 23, 2017


CADOGAN SQUARE II: S&P Lowers Class E Notes Rating to BB- (sf)
--------------------------------------------------------------
S&P Global Ratings took various credit ratings action on all
classes of notes in Cadogan Square CLO II B.V.

Specifically, S&P has:


-- Withdrawn its rating on class B notes following the full
    redemption of this class of notes on the August payment date;

-- Raised its rating on the class C notes, which was partially
    amortized on the August payment date and is now the most
    senior class of notes in the transaction;

-- Affirmed its rating on the class D notes; and

-- Lowered its rating on the class E notes.

S&P said, "The rating actions follow our assessment of the
transaction's performance based on the June and August 2017
trustee report data, our credit and cash flow analysis, and the
developments we have observed since our previous review
(see "Ratings Raised On Cadogan Square CLO II's Class C To E Cash
Flow CLO Notes After Review; Senior Note Ratings Affirmed,"
published on Sept. 30, 2016).

"In our analysis, we have also applied our current counterparty
criteria and our cash flow collateralized debt obligations (CDO)
criteria (see "Counterparty Risk Framework Methodology And
Assumptions," published on June 25, 2013, and "Global
Methodologies And Assumptions For Corporate Cash Flow And
Synthetic CDOs," published on Aug. 8, 2016).

"We have subjected the capital structure to our cash flow
analysis to determine the break-even default rate (BDR) at each
rating level. The BDR represents our estimate of the maximum
level of gross defaults, based on our stress assumptions, that a
tranche can withstand and still fully repay the noteholders. We
used the reported portfolio balance that we considered to be
performing, the principal cash balance, the weighted-average
spread, and the weighted-average recovery rates that we
considered to be appropriate. We incorporated various cash flow
stress scenarios, using various default patterns, levels, and
timings for each liability rating category, in conjunction with
different interest rate stress scenarios. To help assess the
collateral pool's credit risk, we used CDO Evaluator 7.2 to
generate scenario default rates (SDRs). The SDRs represent the
minimum level of portfolio defaults we expect each CDO tranche to
be able to support the specific rating, at each rating level. We
then compared these SDRs with their respective BDRs.

"Our credit and cash flow analysis indicates that the available
credit enhancement for the class C notes is commensurate with a
higher rating than that currently assigned. We have therefore
raised to 'AAA (sf)' from 'AA+ (sf)' our rating on the class C
notes.

"Following the full redemption of the class B notes on the August
payment date, we have withdrawn our 'AAA (sf)' rating on the
class B notes.

"Although the results of our cash flow analysis suggest higher
ratings for the class D and E notes, we have affirmed our 'BBB+
(sf)' rating on class D notes and lowered to BB- (sf)' from 'BB+
(sf)' our rating on the class E notes, based on the maximum
ratings achievable under the largest obligor test. The largest
obligor test is a supplemental stress test under our cash flow
CDO criteria. This test addresses event and model risk that might
be present in the transaction and assesses whether a CDO tranche
has sufficient credit enhancement (not including excess spread)
to withstand specified combinations of underlying asset defaults
based on the ratings on the underlying assets, with a flat
recovery of 5%.

"As the transaction employs excess spread, we applied this test
by running our cash flow modeling using the forward interest rate
curve, including the highest of the losses from the largest
obligor default test net of their respective recoveries. We deem
the test to have passed if cash flows show that the tranche that
is subject to the test receives timely interest (or full
interest, if the tranche is deferrable) and ultimate principal
payments."

Cadogan Square CLO II is a cash flow corporate loan
collateralized loan obligation (CLO) transaction that securitizes
loans to primarily speculative-grade corporate firms and
structured finance assets.

RATINGS LIST

  Cadogan Square CLO II B.V.
  EUR481.8 mil secured floating-rate notes
                                   Rating
  Class        Identifier          To             From
  B            192020AE5           NR             AAA (sf)
  C            192020AG0           AAA (sf)       AA+ (sf)
  D            192020AJ4           BBB+ (sf)      BBB+ (sf)
  E            192020AL9           BB- (sf)       BB+ (sf)
  NR--Not rated


CAIRN CLO VIII: S&P Assigns Prelim B- (sf) Rating to Cl. F Notes
----------------------------------------------------------------
S&P Global Ratings assigned its preliminary credit ratings to
Cairn CLO VIII B.V.'s class A, B-1, B-2, C, D, E, and F senior
secured notes. At closing, the issuer will also issue unrated
subordinated notes.

The preliminary ratings assigned to Cairn CLO VIII's notes
reflect our assessment of:

-- The diversified collateral pool, which will consist primarily
    of broadly syndicated speculative-grade senior secured term
    loans and bonds that are governed by collateral quality
    tests.

-- The credit enhancement provided through the subordination of
    cash flows, excess spread, and overcollateralization.

-- The collateral manager's experienced team, which can affect
    the performance of the rated notes through collateral
    selection, ongoing portfolio management, and trading.

-- The transaction's legal structure, which is expected to be
    bankruptcy remote.

The transaction's counterparty risks.

The transaction is a cash flow collateralized debt obligation
(CLO), securitizing a portfolio of primarily senior secured loans
granted to speculative-grade corporates. Cairn Loan Investments
LLP manages the transaction. The portfolio is 40.57% ramped up
and expects to have 70% ramped at closing.

Under the transaction documents, the rated notes will pay
quarterly interest unless a frequency switch event occurs.
Following this, the notes will permanently switch to semiannual
interest payments.

S&P' said, "Our preliminary ratings reflect our assessment of the
collateral portfolio's credit quality, which has a weighted-
average 'B' rating. We consider that the portfolio on the
effective date will be well diversified, primarily comprising
broadly syndicated speculative-grade senior secured term loans
and senior secured bonds. Therefore, we have conducted our credit
and cash flow analysis by applying our criteria for corporate
cash flow collateralized debt obligations (CDOs; see "Global
Methodologies And Assumptions For Corporate Cash Flow And
Synthetic CDOs," published on Aug. 8, 2016).

"In our cash flow analysis, we used the EUR350 million target par
amount, the covenanted weighted-average spread (3.70%), the
modelled weighted-average fixed coupon (5.25%), the covenanted
weighted-average recovery rate of 36.00% at the 'AAA' rating
level, and the current weighted-average recovery rates at each
rating level below 'AAA'. We applied various cash flow stress
scenarios, using four different default patterns, in conjunction
with different interest rate stress scenarios for each liability
rating category.

"We consider that the transaction's documented counterparty
replacement and remedy mechanisms at closing will adequately
mitigate its exposure to counterparty risk under our current
counterparty criteria (see "Counterparty Risk Framework
Methodology And Assumptions," published on June 25, 2013).

"Following the application of our structured finance ratings
above the sovereign criteria, we consider the transaction's
exposure to country risk to be limited at the assigned
preliminary rating levels, as the exposure to individual
sovereigns does not exceed the diversification thresholds
outlined in our criteria (see "Ratings Above The Sovereign -
Structured Finance: Methodology And Assumptions," published on
Aug. 8, 2016).

"We expected the transaction's legal structure to be bankruptcy
remote, in line with our legal criteria (see "Structured Finance:
Asset Isolation And Special-Purpose Entity Methodology,"
published on March 29, 2017).

"Following our analysis of the credit, cash flow, counterparty,
operational, and legal risks, we believe our preliminary ratings
are commensurate with the available credit enhancement for each
class of notes."

RATINGS LIST

  Cairn CLO VIII B.V.
  EUR361.2 mil secured fixed-rate and floating-rate notes
  (including EUR35.5 mil unrated notes)

  Prelim Amount
  Class                  Prelim Rating      (mil, EUR)
  A                      AAA (sf)            214.4
  B-1                    AA (sf)             27.3
  B-2                    AA (sf)             10.0
  C                      A (sf)              23.9
  D                      BBB (sf)            18.5
  E                      BB (sf)             22.3
  F                      B- (sf)             9.3
  M-1 Sub                NR                  17.8
  M-2 Sub                NR                  17.7

  NR--Not rated


ING GROEP: Moody's Affirms Ba1 Pref. Stock Non-cumulative Rating
----------------------------------------------------------------
Moody's Investors Service has upgraded the long-term deposit and
senior unsecured debt ratings of ING Bank N.V. (ING Bank) to Aa3
from A1, and changed the outlook to stable from positive. The
rating upgrades were prompted by Moody's expectation of
significant issuance of additional loss-absorbing debt and
capital in response to forthcoming regulatory requirements.

This issuance will reduce the loss severity for the bank's senior
unsecured debt and deposits, according to Moody's revised
advanced Loss Given Failure (LGF) analysis. The revised LGF
analysis was undertaken following updates to Moody's Banks rating
methodology, published on Sept. 26, 2017, which can be accessed
using the following link:
https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC
_1065675.

Moody's has affirmed ING Bank's Baa2 subordinated debt rating and
Prime-1 short-term rating, as well as its Counterparty Risk (CR)
Assessment of Aa3(cr)/Prime-1(cr). The rating agency also
affirmed ING Bank's holding company ING Groep N.V. (ING Groep)'s
long-term senior unsecured debt rating of Baa1 with a stable
outlook, its subordinated debt rating of Baa2, its junior
subordinated debt rating of Baa3(hyb)/Baa2(hyb) and non-
cumulative preferred stock rating of Ba1(hyb).

The stable outlook on ING Bank and ING Groep's long-term ratings
reflect Moody's expectation that the banking group's
profitability will remain broadly resilient to pressure from low
interest rates over the next 12-18 months, while asset risk will
remain low and the capital position will continue to strengthen.
The outlook also anticipates ING Groep's future issuance of
senior unsecured debt to comply with minimum loss absorbing
capital requirements coming into force in 2019.

RATINGS RATIONALE

RATING UPGRADES REFLECT REDUCED LOSS SEVERITY FOR CREDITORS FROM
EXPECTED ISSUANCE OF ADDITIONAL LOSS-ABSORBING CAPITAL

The upgrade of ING Bank's long-term deposit and senior unsecured
debt ratings to Aa3 from A1 reflects Moody's expectation that ING
Groep will continue to issue debt in order to comply with Total
Loss Absorbing Capacity (TLAC) requirements, which will require
it to have minimum TLAC of 21.5% of risk-weighted assets (RWAs)
by January 2019, and 23.5% by January 2022. Moody's estimates
that ING Groep's TLAC ratio was 21.5% at the end of June 2017.

The group has announced it will issue, through its holding
company ING Groep, a minimum of EUR16 billion of senior unsecured
debt over the next two to three years, in order to meet minimum
TLAC requirements and build a management buffer above this. This
debt will be structurally subordinated to ING Bank's own senior
unsecured debt and deposits in a resolution scenario. Out of the
total planned issuance, ING Groep has to date issued EUR5.1
billion of senior unsecured debt and EUR2.1 billion of Tier 2
debt. Moody's expects ING Groep to continue its issuance
programme in line with its medium-term plan, based upon its
continued good access to the capital markets. In its advanced LGF
analysis, Moody's incorporates the bank's issuance plans up until
2020. Thereafter, further issuance is likely to meet 2022
requirements, but this more distant additional change in the
bank's balance sheet would not in itself result in further rating
changes and is subject to inherently greater uncertainty.

Given the nearer term changes in ING Groep's balance sheet,
Moody's revised advanced LGF analysis indicates extremely low
loss-given-failure for ING Bank's long-term depositors and senior
unsecured creditors, resulting in a three-notch uplift in the
ratings from the firm's adjusted baseline credit assessment (BCA)
of baa1, from two notches previously. The bank's long-term
deposit and senior unsecured debt ratings continue to incorporate
one notch of government support, reflecting Moody's assessment of
a moderate probability of support from the Dutch government for
these creditors, as a result of the bank's systemic importance.

The same LGF analysis for ING Groep continues to indicate a
moderate loss severity for senior unsecured creditors in the
event of the group's failure, leading to a rating of Baa1, in
line with ING Bank's adjusted BCA. ING Groep senior unsecured
debt ratings do not include additional uplift from government
support assumptions, reflecting Moody's view that there is a low
probability of government support for these creditors given their
explicitly loss-absorbing nature.

WHAT COULD MOVE THE RATINGS UP/DOWN

ING Bank's BCA could be upgraded in case of (1) a material
improvement in the operating environment in the EU countries to
which the bank is mostly exposed, leading to substantially
improved asset risk and a higher profitability level; (2) a
strengthening capital position; or (3) a lower reliance on
confidence-sensitive wholesale funding. An upgrade in the BCA
would likely lead to an upgrade to all ratings of ING Bank and
ING Groep.

ING Groep's senior unsecured debt ratings could also be upgraded
if the holding company were to issue higher than expected amounts
of long-term debt and/or junior instruments, leading to lower
loss severity for senior creditors.

ING Bank's BCA could be downgraded in case of (1) an unexpected
deterioration in asset risk and profitability; or (2) a lower
than expected capital position. A downgrade of the BCA would
likely result in downgrades to all ratings.

ING Bank's ratings could also be downgraded should changing
regulatory requirements or management strategy lead to a
reduction in expected debt issuance, leading to increased loss-
given-failure.

LIST OF AFFECTED RATINGS

Issuer: ING Bank N.V.

Upgrades:

-- Long-term Bank Deposits, upgraded to Aa3 from A1, outlook
    changed to Stable from Positive

-- Senior Unsecured Regular Bond/Debenture, upgraded to Aa3 from
    A1, outlook changed to Stable from Positive

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)Aa3
    from (P)A1

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed Aa3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Short-term Bank Deposits, affirmed P-1

-- Subordinate Regular Bond/Debenture, affirmed Baa2

-- Subordinate Medium-Term Note Program, affirmed (P)Baa2

-- Short-term Deposit Note/CD Program, affirmed P-1

-- Commercial Paper, affirmed P-1

-- Other Short Term, affirmed (P)P-1

Outlook Action:

-- Outlook changed to Stable from Positive

Issuer: ING Groep N.V.

Affirmations:

-- Senior Unsecured Regular Bond/Debenture, affirmed Baa1,
    outlook Stable

-- Senior Unsecured Medium-Term Note Program, affirmed (P)Baa1

-- Senior Unsecured Shelf, affirmed (P)Baa1

-- Subordinate Regular Bond/Debenture, affirmed Baa2

-- Subordinate Medium-Term Note Program, affirmed (P)Baa2

-- Subordinate Shelf, affirmed (P)Baa2

-- Junior Subordinated Regular Bond/Debenture, affirmed
    Baa2(hyb)/Baa3(hyb)

-- Junior Subordinate Medium-Term Note Program, affirmed (P)Baa3

-- Junior Subordinate Shelf, affirmed (P)Baa3

-- Preferred Stock, affirmed Baa3(hyb)

-- Preferred Shelf Non-cumulative, affirmed (P)Ba1

-- Preferred Stock Non-cumulative, affirmed Ba1(hyb)

Outlook Action:

-- Outlook remains Stable

Issuer: ING (US) Issuance LLC

Upgrades:

-- Backed Senior Unsecured Medium-Term Note Program, upgraded to
    (P)Aa3 from (P)A1

-- Backed Senior Unsecured Regular Bond/Debenture, upgraded to
    Aa3 from A1, outlook changed to Stable from Positive

Outlook Action:

-- Outlook changed to Stable from Positive

Issuer: ING (U.S.) Funding LLC

Affirmations:

-- Backed Commercial Paper, affirmed P-1

Outlook Action:

-- No Outlook assigned

Issuer: ING Bank N.V. (Singapore)

Upgrades:

-- Senior Unsecured Regular Bond/Debenture, upgraded to Aa3 from
    A1, outlook changed to Stable from Positive

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed Aa3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

Outlook Action:

-- Outlook changed to Stable from Positive

Issuer: ING Bank N.V., Sydney Branch

Upgrades:

-- Senior Unsecured Regular Bond/Debenture, upgraded to Aa3 from
    A1, outlook changed to Stable from Positive

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)Aa3
    from (P)A1

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed Aa3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Commercial Paper, affirmed P-1

-- Other Short Term, affirmed (P)P-1

Outlook Action:

-- Outlook changed to Stable from Positive

Issuer: ING Bank N.V., Tokyo Branch

Upgrades:

-- Long-term Bank Deposits, upgraded to Aa3 from A1, outlook
    changed to Stable from Positive

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed Aa3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Short-term Bank Deposits, affirmed P-1

-- Commercial Paper, affirmed P-1

Outlook Action:

-- Outlook changed to Stable from Positive

Issuer: ING Groenbank N.V.

Upgrades:

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)Aa3
    from (P)A1

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed Aa3(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Other Short Term, affirmed (P)P-1

Outlook Action:

-- No Outlook assigned

Issuer: ING Capital Funding Trust III

Affirmation:

-- Backed Preferred Stock Non-cumulative, affirmed Ba1(hyb)

Outlook Action:

-- No Outlook assigned

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in September 2017.


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


LUSITANO MORTGAGES No. 6: Moody's Affirms Caa3 Cl. D Notes Rating
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Moody's Investors Service has upgraded the ratings of 4 notes and
affirmed the ratings of 6 notes in three Portuguese RMBS
transactions, i.e. Azor Mortgages Public Limited Company,
Lusitano Mortgages No. 6 Designated Activity Company ("Lusitano
Mortgages No. 6 DAC") and Magellan Mortgages No. 1 plc. The
rating action reflects:

- better than expected collateral performance for Azor Mortgages
Public Limited Company and Magellan Mortgages No. 1 plc.

- the increased levels of credit enhancement for Lusitano
Mortgages No. 6 DAC.

Moody's affirmed the ratings of the notes that had sufficient
credit enhancement to maintain current rating on the affected
notes.

Please note that Lusitano Mortgages No. 6 DAC was previously
Lusitano Mortgages No. 6 Limited, before the conversion to a
Designated Activity Company on the 17th of September 2016.

Issuer: Azor Mortgages Public Limited Company

-- EUR253M Class A Notes, Affirmed A1 (sf); previously on Dec.
    21, 2016 Affirmed A1 (sf)

-- EUR19M Class B Notes, Affirmed A1 (sf); previously on Dec.
    21, 2016 Affirmed A1 (sf)

-- EUR9M Class C Notes, Upgraded to A2 (sf); previously on Dec.
    21, 2016 Upgraded to A3 (sf)

Issuer: Lusitano Mortgages No. 6 Designated Activity Company

-- EUR943.25M Class A Notes, Affirmed A1 (sf); previously on
    July 16, 2015 Upgraded to A1 (sf)

-- EUR65.45M Class B Notes, Upgraded to Baa1 (sf); previously on
    July 16, 2015 Upgraded to Baa3 (sf)

-- EUR41.8M Class C Notes, Upgraded to Ba3 (sf); previously on
    July 16, 2015 Upgraded to B3 (sf)

-- EUR17.6M Class D Notes, Affirmed Caa3 (sf); previously on
    July 16, 2015 Affirmed Caa3 (sf)

Issuer: Magellan Mortgages No. 1 plc

-- EUR942.5M Class A Notes, Affirmed A1 (sf); previously on May
    6, 2016 Affirmed A1 (sf)

-- EUR37M Class B Notes, Affirmed A1 (sf); previously on May 6,
    2016 Upgraded to A1 (sf)

-- EUR20.5M Class C Notes, Upgraded to A2 (sf); previously on
    July 27, 2017 Upgraded to Baa1 (sf)

RATINGS RATIONALE

The rating action is prompted by:

- decreased key collateral assumptions, namely the portfolio
Expected Loss (EL) and Milan assumptions due to better than
expected collateral performance for Azor Mortgages Public Limited
Company and, portfolio EL for Magellan Mortgages No. 1 plc.

- deal deleveraging resulting in an increase in credit
enhancement for Lusitano Mortgages No. 6 DAC.

Revision of Key Collateral Assumptions:

As part of the rating action, Moody's reassessed its lifetime
loss expectation for the portfolio reflecting the collateral
performance to date.

The performance of Azor Mortgages Public Limited Company has
continued to improve since last year. Total delinquencies have
decreased, with 90 days plus arrears currently standing at 0.26%
of current pool balance from 1.31% last year.

The performance of Magellan Mortgages No. 1 plc has continued to
improve since last year. Total delinquencies have decreased, with
90 days plus arrears currently standing at 0.56% of current pool
balance from 0.67% last year.

Moody's decreased the expected loss assumption for Azor Mortgages
Public Limited Company and Magellan Mortgages No. 1 plc to 1.34%
and 0.60% respectively, as a percentage of original pool balance,
from 1.80% and 0.69% respectively, due to the improving
performance.

The expected loss assumption of Lusitano Mortgages No. 6 DAC
remains unchanged.

Moody's has also assessed loan-by-loan information as a part of
its detailed transaction review to determine the credit support
consistent with target rating levels and the volatility of future
losses. As a result, Moody's has decreased the portfolio credit
Milan CE assumption of Azor Mortgages Public Limited Company to
11.5% from 12.4%.

The MILAN CE of Lusitano Mortgages No. 6 DAC and Magellan
Mortgages No. 1 plc remains unchanged.

Increase in Available Credit Enhancement:

Sequential amortization and trapping of excess spread led to the
increase in the credit enhancement available in Lusitano
Mortgages No. 6 DAC.

For instance, the credit enhancement for the tranche B and C
affected by rating action increased from 12.5% and 5.4% to 14.0%
and 6.2% respectively since last year. The amount of principal
deficiency for this transaction has now decreased to EUR15.8
million from EUR18.1 million last year.

The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
September 2017.

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

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

Factors or circumstances that could lead to an upgrade of the
ratings include (1) performance of the underlying collateral that
is better than Moody's expected, (2) deleveraging of the capital
structure and (3) improvements in the credit quality of the
transaction counterparties and (4) a decrease in sovereign risk.

Factors or circumstances that could lead to a downgrade of the
ratings include (1) an increase in sovereign risk (2) performance
of the underlying collateral that is worse than Moody's expected,
(3) deterioration in the notes' available credit enhancement and
(4) deterioration in the credit quality of the transaction
counterparties.


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R U S S I A
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CREDIT BANK: Moody's Hikes LT Senior Unsecured Debt Rating to Ba3
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Moody's Investors Service upgraded the long-term local- and
foreign-currency senior unsecured debt and deposit ratings of
Credit Bank of Moscow (CBM) to Ba3 from B1 and changed the
outlook to stable from positive. CBM's long-term Counterparty
Risk Assessment (CR Assessment) was upgraded to Ba2(cr) from
Ba3(cr).

Concurrently, Moody's downgraded the bank's baseline credit
assessment (BCA) to b2 from b1, adjusted BCA to b2 from b1 and
subordinated debt rating to Caa2(hyb) from Caa1(hyb). CBM's Not
Prime short-term local- and foreign-currency deposit ratings, and
the bank's short-term CR Assessment of Not Prime(cr) were
affirmed.

RATINGS RATIONALE

The upgrade of CBM's long-term deposit and senior unsecured debt
ratings to Ba3 from B1 reflects Moody's view that the probability
of the bank's senior debt and deposits benefiting from support
from the Central Bank of Russia (CBR) should it be needed is now
high. The CBR has recently introduced and tested its newly-
designed toolkit to provide extraordinary support to large
privately-owned banks via its Banking Sector Consolidation Fund
(BSCF). This results in two notches of uplift to the bank's
senior unsecured debt and deposit ratings from its BCA of b2. The
upgrade follows the CBR's announcement on 13 September 2017 that
it had designated CBM as a systemically important bank, it being
one of Russia's ten largest banks by assets as of 30 June 2017.

The downgrade in the BCA to b2 from b1 reflects Moody's view that
the bank's creditworthiness is increasingly affected by its
strategy of providing very extensive financing to a small number
of highly leveraged customers.

The stable outlook on the long-term senior unsecured debt and
deposit ratings is driven by Moody's expectation that the bank's
solvency metrics will be broadly stable over the next 12-18
months.

CBM's problem loans ratio at end-June 2017 was 8.8% of gross
loans as defined by Moody's, which is below the average of about
12% for the Russian banks. The rating agency believes that CBM's
problem loans have peaked and expects that they will steadily
decrease over the next 12-18 months as (1) crisis-related problem
lending has already been detected, and (2) several large
exposures will move from impaired to performing. However, the
bank has certain exposures which while not classed as
problematic, appear to bear elevated credit risk. Moody's
estimates that such exposures total about 8% of the gross loan
book as of end-June 2017.

The bank's profitability has been improving over the previous
several quarters, with its annualized return-on-average assets
(ROAA) increasing to 1.3% in H1 2017 from 0.8% and 0.2% for the
reported full years 2016 and 2015 respectively. This positive
trend has been largely driven by an increase of recurring
revenues following expansion of the bank's balance sheet, along
with a steady reduction of credit costs. Moody's expects that
CBM's financial performance will remain robust in the next 12-18
months and bolster the bank's capitalization. As of end-June
2017, CBM reported a Tangible Common Equity (TCE) at 10.5% of
risk-weighted assets, aided by the improvement in the bank's
profitability.

However, the bank's profitability remains volatile and somewhat
dependent on its large reverse repo transactions, which amounted
to 36.5% of total assets at end-June 2017. Gains from these deals
contributed to the bank's improved returns but are of limited
sustainability in Moody's view.

WHAT COULD MOVE THE RATINGS UP / DOWN

CBM's BCA could be upgraded were there to be a sustained
improvement in its solvency metrics, in particular asset quality,
along with a reduction of higher credit risk lending and single-
name concentrations in loan portfolio and customer deposits.

Conversely, the bank's BCA could be downgraded if CBM's credit
profile weakened as a consequence of an unexpected deterioration
of its liquidity or loss absorption capacity.

The bank's supported ratings may be revised if the government's
capacity or willingness to provide support to CBM were to weaken.

LIST OF AFFECTED RATINGS

Issuer: Credit Bank of Moscow

Downgrades:

-- Subordinate, Downgraded to Caa2 (hyb) from Caa1 (hyb)

-- Adjusted Baseline Credit Assessment, Downgraded to b2 from b1

-- Baseline Credit Assessment, Downgraded to b2 from b1

Upgrades:

-- LT Bank Deposits, Upgraded to Ba3 from B1, Outlook Changed To
    Stable From Positive

-- Senior Unsecured Regular Bond/Debenture, Upgraded to Ba3 from
    B1, Outlook Changed To Stable From Positive

-- LT Counterparty Risk Assessment, Upgraded to Ba2(cr) from
    Ba3(cr)

Affirmations:

-- ST Bank Deposits, Affirmed NP

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

Outlook Actions:

-- Outlook, Changed To Stable From Positive

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in September 2017.


SUEK JSC: Moody's Revises Outlook to Positive, Affirms Ba3 CFR
--------------------------------------------------------------
Moody's Investors Service has changed to positive from stable the
outlook on the ratings of Russia's largest thermal coal miner
SUEK JSC. Concurrently, Moody's has affirmed SUEK's Ba3 corporate
family rating (CFR), Ba3-PD probability of default rating (PDR)
and the Ba3 (LGD 4) senior unsecured ratings assigned to the
bonds issued by SUEK Finance, a Russia-domiciled wholly owned
subsidiary of SUEK.

"Moody's has changed SUEK's outlook to positive mainly on the
back of its deleveraging since the beginning of this year, as
well as Moody's expectations that it will continue to reduce
leverage, follow a prudent financial policy and maintain
sufficient liquidity," says Artem Frolov, a Vice President -
Senior Credit Officer at Moody's.

RATINGS RATIONALE

The change of SUEK's outlook to positive and affirmation of its
ratings primarily reflect the decline in the company's leverage
to 2.8x Moody's-adjusted gross debt/EBITDA at 30 June 2017 from
3.5x at year-end 2016. The rating action also reflects Moody's
expectation that SUEK will (1) continue to reduce its leverage;
(2) pursue a conservative financial policy; and (3) retain at
least adequate liquidity.

Moody's could consider an upgrade of SUEK's ratings if its
leverage were to decline sustainably below 2.5x. However, the
company's EBITDA and, consequently, leverage are sensitive to the
volatile prices of thermal coal, as well as rouble exchange rate
to US dollar. The decline in leverage at 30 June 2017 was driven
primarily by the increase in the company's last-12-month Moody's-
adjusted EBITDA by $302 million to $1.4 billion, due to higher
seaborne thermal coal prices in the second half of 2016 and first
half of 2017. If, however, prices were to materially decrease or
rouble to strengthen, SUEK's leverage could remain above 2.5x,
which is an upgrade threshold for the company's Ba3 rating,
reducing the possibility for an upgrade over the next 12-18
months.

SUEK's Ba3 CFR also factors in the company's (1) conservative
financial policy aimed at deleveraging; (2) status as a global
thermal coal producer; (3) competitive operating costs on the
back of weak rouble and cost efficiency measures; (4) vast coal
reserves and high operational diversification, with 27 operating
sites; (5) control over a considerable portion of its
transportation infrastructure (including ports in Vanino,
Murmansk and Maly and large railcar fleet), such that it is
positioned to efficiently service Pacific and Atlantic export
markets; (6) high quality of coal products and diversified
domestic and international customer base; and (7) sustainable
revenues from domestic sales, which are not linked to seaborne
benchmark prices, and proximity of the company's mines to its
power generation customers.

At the same time, the rating takes into account (1) the high
sensitivity of SUEK's earnings and leverage to the volatile
thermal coal prices in seaborne markets and rouble exchange rate;
(2) the company's exposure to a single commodity, thermal coal;
(3) its sizeable railway expenses, which mainly depend on the
level of regulated cargo transportation tariffs; (4) the
company's reliance on short-term roll-over credit facilities to
maintain adequate liquidity; (5) SUEK's fairly aggressive
liquidity management, as the company tends to address its
refinancing needs shortly before debt maturity dates, although
refinancing risks are mitigated by the company's continuing
access to domestic and international debt financing; (6) risks
related to the company's concentrated ownership structure,
although mitigated by good corporate governance; and (7)
uncertainty regarding the long-term development of carbon
emissions regulation, which could negatively affect global demand
for thermal coal.

RATIONALE FOR THE POSITIVE OUTLOOK

The positive outlook reflects the company's strong positioning
within the current rating category and the possibility of an
upgrade over the next 12-18 months if its leverage continues to
decline on a sustainable basis.

WHAT COULD CHANGE THE RATINGS UP/DOWN

Moody's could upgrade SUEK's ratings if the company were to (1)
reduce its Moody's-adjusted gross debt/EBITDA below 2.5x on a
sustainable basis; (2) generate sustainable positive free cash
flow; and (3) maintain at least adequate liquidity.

Moody's could downgrade the ratings if (1) the company's Moody's-
adjusted gross debt/EBITDA were to exceed 3.5x on a sustained
basis; (2) the company were unable to generate positive free cash
flow; or (3) its liquidity and liquidity management were to
deteriorate materially. However, a rating downgrade is currently
unlikely given the positive outlook.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Global Mining
Industry published in August 2014.

SUEK JSC is a holding company of Russia's largest producer of
thermal coal and one of the world's top thermal coal producers.
SUEK operates 15 opencast and 12 underground mines in eight
geographic regions in Siberia and the Russian Far East. In the
last 12 months to 30 June 2017, the company generated revenues of
$4.9 billion and Moody's-adjusted EBITDA of $1.4 billion. SUEK
owns rail infrastructure, rail rolling stock, Vanino Bulk
Terminal (a coal terminal at Vanino in the Sea of Japan), a
84.85% stake in the voting shares of the ice-free Murmansk
Commercial Seaport in the northwest of Russia and a 49.9% stake
in Maly Port in the Far East of Russia. The company's principal
ultimate beneficiary is Mr. Andrey Melnichenko.


TATAGROPROMBANK LLC: Liabilities Exceed Assets, Assessment Shows
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The provisional administration to manage LLC TATAGROPROMBANK,
further referred to as the Bank, appointed by Bank of Russia
Order No. OD-873, dated April 5, 2017 following license
revocation, in the course of its inspection of the Bank's
financial standing established that the Bank's management and
owners conducted transactions to siphon off liquid assets by
extending loans to entities of dubious solvency, according to the
press service of the Central Bank of Russia.

Such entities included those under the Bank staff's control; the
credit funds were then channelled into loans to third parties and
the Bank's affiliated company to buy securities and land plots
and to pay off debt under land sale agreements to numerous
counterparties.

The provisional administration estimates the value of the Bank's
assets to be no more than RUR953.9 million, vs. RUR1,681.1
million of its liabilities to creditors including RUR1,663
million to individuals.

On May 22, 2017, the Arbitration Court of the Republic of
Tatarstan recognized LLC TATAGROPROMBANK as insolvent (bankrupt).
The State Corporation Deposit Insurance Agency was appointed as a
receiver.

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


TEMPBANK PJSC: Put on Provisional Administration, License Revoked
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The Bank of Russia, by virtue of Order No. OD-2805, dated October
2, 2017, revoked the banking license of Moscow-based credit
institution Public Joint-stock Company Moscow Joint-stock Bank
Tempbank, further referred to as the credit institution, ,
according to the press service of the Central Bank of Russia.

According to the financial statements, as of September 1, 2017,
the credit institution ranked 174th by assets in the Russian
banking system.

The credit institution's business model was focused on serving
the interests of its owners.  Lending to borrowers directly or
indirectly related to the ultimate beneficiaries of the credit
institution and not engaged in any real business operations
resulted in the considerable amount of non-performing assets in
the credit institution's balance sheet.  With its assets of poor
quality, the credit institution failed to adequately assess the
risks assumed.  The Deposit Insurance Agency State Corporation,
entrusted in accordance with a Bank of Russia order with the
duties of a provisional administration to manage the credit
institution, conducted an assessment of the bank's financial
position.  Following this assessment, the fair presentation of
asset value in the credit institution's financial statements
showed a full loss of its equity capital.

The Bank of Russia repeatedly applied supervisory measures to the
credit institution, including impositions of restrictions and
total ban on household deposit taking.

However, the credit institution's management and owners failed to
take effective measures to normalise its activities.

According to the Deposit Insurance Agency State Corporation
findings, it is not feasible to apply a financial resolution
procedure with the funds of the Agency and the credit
institution's creditors in view of extremely low asset quality, a
significant disbalance between the value of assets and
liabilities and the credit institution's inability to meet its
creditors' claim at any time thereafter.

Under these circumstances, the Bank of Russia performed its duty
as regards banking license revocation in accordance with Article
20 of the Federal Law "On Banks and Banking Activities".

The Bank of Russia took this extreme measure because of the
credit institution's failure to comply with federal banking laws
and Bank of Russia regulations, equity capital adequacy ratios
below two per cent, the decrease in bank equity capital below the
minimum value of the authorised capital established as of the
date of the state registration of the credit institution, and
given the repeated application within a year of measures
envisaged by the Federal Law "On the Central Bank of the Russian
Federation (Bank of Russia)".

Following banking license revocation, the functions of the
provisional administration to manage PJSC MJSB Tempbank,
entrusted with the Deposit Insurance Agency State Corporation in
accordance with Bank of Russia Order No. OD-870, dated April 5,
2017, are terminated pursuant to Bank of Russia Order No. OD-
2806, dated October 2, 2017.

The Bank of Russia, by virtue of its Order No. OD-2807, dated
October 2, 2017, appointed a provisional administration to PJSC
MJSB Tempbank 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.

PJSC MJSB Tempbank is a member of the deposit insurance system.
An insured event shall be deemed as occurring starting from the
date the moratorium on meeting the creditor claims of PJSC MJSB
Tempbank (April 5, 2017), which shall also be the date used for
calculation of insurance indemnity for the bank's liabilities in
foreign currency.

The revocation of the banking license, put in force before the
moratorium on meeting creditor claims expires, shall not cancel
the obligation of the Deposit Insurance Agency State Corporation
to pay out insurance indemnity.

The Agency will continue to pay out insurance indemnity for
deposits (deposit accounts) with Public Joint-stock Company Bank
Jugra in accordance with Clause 2 Part 1 Article 8 of Federal Law
No. 177-FZ, dated December 23, 2003, "On the Insurance of
Household Deposits with Russian Banks" -- imposition by the Bank
of Russia of the moratorium on meeting creditor claims.

Information on the authorised agent banks to pay an insurance
indemnity can be found on the official website of the state
corporation Deposit Insurance Agency (www.asv.org.ru).


VOZROZHDENIE BANK: S&P Affirms 'BB-/B' CCR, Outlook Negative
------------------------------------------------------------
S&P Global Ratings said it has affirmed its 'BB-/B' long- and
short-term counterparty credit ratings on Russia-based
Vozrozhdenie Bank. The outlook is negative.

S&P said, "We affirmed our ratings on Vozrozhdenie Bank because
we consider the bank will be in a transition phase, given the
likely merger with Promsvyazbank by the end of 2017. In such a
scenario, we believe the bank's creditors will benefit from
extraordinary government support, as we expect will be the case
for Promsvyazbank. In our view, this will compensate for the
pressure on Vozrozhdenie Bank's capitalization from the higher-
than-expected growth of its risk-adjusted assets in 2016-2017. To
reflect this, we apply one notch of uplift to our assessment of
Vozrozhdenie Bank's stand-alone credit profile (SACP).

"At the same time, we revised our assessment of Vozrozhdenie
Bank's SACP to 'b+' from 'bb-' due to its decreased capital
buffers. We now forecast that Vozrozhdenie Bank's risk-adjusted
capital (RAC) ratio will be around 4.5%-5.0% in 2017, down from
5.3% at the end of 2015.

"We expect that Vozrozhdenie Bank will be able to retain its
business franchise following the merger with Promsvyazbank.
Vozrozhdenie Bank has demonstrated good financial results
focusing on servicing small and midsize enterprises and retail
clients in the wealthy Moscow region over the recent decade, the
segments that Promsvyazbank considers its strategic priority.
Thus, we believe that the considered merger might be beneficial
for both banks. With total assets of Russian ruble (RUB) 244
billion (about $4.2 billion) as of Sept. 1, 2017, Vozrozhdenie
Bank ranked among the top 40 Russian banks in terms of assets,
with more than 60% of loans extended to borrowers in Moscow and
the Moscow region.

"We assess Vozrozhdenie Bank's risk position as adequate. The
bank reported nonperforming loans (more than 90 days overdue) of
6.4% of total loans on June 30, 2017, below the sector average of
9%-10%.

"Vozrozhdenie Bank's funding is average and its liquidity is
adequate, in our opinion. The bank's funding profile is supported
by its retail deposits base, which accounts for about 70% of
total deposits. The bank did not experience any material deposit
outflows in July and August 2017, when the operating environment
for Russian banks became volatile and several banks experienced
pronounced deposit outflows.

"The negative outlook reflects our expectation that Vozrozhdenie
Bank's credit profile may be under pressure in the next 12-18
months, following the merger with Promsvyazbank. This is due to
our estimate that the combined bank's exposure to the risky real
estate and construction sector would be higher than the Russian
banking sector average, and single-name concentrations will
likely remain higher than global peers', adversely affecting
asset quality.

"We could lower the ratings if Vozrozhdenie Bank's merger with
Promsvyazbank did not materialize and the bank continued to
operate on a stand-alone basis. In this scenario, we could remove
the transition notch that we currently incorporate into the long-
term rating if we think potential support from shareholders might
be insufficient and the bank is unable to share the systemically
important status of Promsvyazbank, which implies availability of
extraordinary government support if needed.

"A revision of the outlook to stable is remote at this stage. It
would depend on completion of the merger, successful integration
of the banks, and sustainably improved asset quality indicators
and capital buffers, with the RAC ratio increasing comfortably
beyond 5%."


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S P A I N
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NH HOTEL: Moody's Affirms B2 CFR, Revises Outlook to Positive
-------------------------------------------------------------
Moody's Investors Service affirmed the corporate family rating of
NH Hotel Group S.A. (NH) at B2, the probability of default rating
at B2-PD and the rating of NH's senior secured notes due 2023 at
Ba3. The rating outlook has been revised to positive from stable.

"Moody's decisions to revise the rating outlook to positive
follows the NH's successful streamlining of its operations and
repositioning of its portfolio resulting in improved KPIs and
cost savings," says Maria Maslovsky, a Moody's Vice President --
Senior Analyst and the lead analyst for NH Hotels. "In addition,
NH has significantly extended its maturity profile and
strengthened its liquidity."

RATINGS RATIONALE

The rating action reflects strengthened performance as a result
of portfolio repositioning and improved operations. From 2014 to
2016, NH Hotels invested approximately EUR200 million in
upgrading and repositioning its owned and leased hotel portfolio
built through a series of acquisitions to align the assets with a
focus on the NH Collection brand. Simultaneously with this
effort, the company invested in new soft goods for the properties
and introduced technological advances including a new revenue
management system, seamless front-office transactions and back-
of-house applications and a mobile app. Combined with clearer
brand definition and focused marketing efforts, NH's Tripadvisor
scores improved considerably and led to strengthening KPIs with
RevPAR (revenue per available room) growing 10.7% in the first
half of 2017 primarily driven by rate improvements. NH has also
focused on improving profitability by exiting loss-making leases
and management contracts and restructuring lease agreements
toward variable rather than fixed arrangements. The company
anticipates realizing EUR7-EUR8 million of cost savings in 2017
and a further EUR7-EUR10 million in 2018.

The positive outlook also reflects successful refinancing and
extending debt maturities while improving liquidity. NH Hotels
refinanced multiple debt maturities with its EUR285 million
secured bond offering in September 2016 and a subsequent EUR115
million tap in March 2017 extending its average tenor to 4.4
years at June 2017 from 3.1 years at December 2015. As a result
of both operational improvements and resulting EBITDA growth, as
well as the recent refinancing, NH's leverage measured as
debt/EBITDA declined to 4.8x for the twelve months ended 30 June
2017 from 5.3x at year-end 2016 and 5.6x the year before.
Simultaneously, NH's coverage measured as EBITA/interest expense
grew to 1.3x for the twelve months ended 30 June 2017 from 1.1x
in 2016 and 1.0x in 2015. The company has also generated positive
free cash flow (after capex and dividends) in the twelve months
ended 30 June 2017 reversing a multi-year negative trend. All
metrics are adjusted by Moody's. Moody's adjusts leverage metrics
by applying a 5x multiple to the annual rent expense. The company
does not disclose in its audited accounts the undiscounted
minimum commitments under operating leases; however, Moody's
believes that adjusted debt/EBITDA could be revised higher than
4.8x if the net present value of future lease commitments were
used. Moody's anticipates that with the introduction of IFRS 16
in 2019 this point will be clarified.

NH Hotels' B2 corporate family rating continues to reflect its
established European platform focused on midscale, upscale and
upper upscale urban business hotels, its successful portfolio
turnaround, as well as reduced leverage, strengthened coverage
and positive free cash flow combined with improved liquidity. The
rating also takes into consideration that NH's growth initiatives
in Latin America, while limited in scope, carry a measure of risk
primarily related to some of the Latin American markets facing
challenging macroeconomic environments, in addition to currency
exchange and repatriation issues.

NH's liquidity is good. It includes positive operating cash flow
and cash of EUR114.5 million at 30 June 2017, as well as a EUR250
million revolving credit facility (RCF) which is currently
undrawn and approximately EUR53 million of other available credit
lines. These sources should be able to address the upcoming
EUR250 million maturity of the convertible bond in 2018 (should
it not convert to equity) and the remaining EUR100 million
maturity of the secured high yield bond in 2019. NH's stock has
recently been trading above the strike price of the convertible
bond (EUR4.92 per share), although it has been volatile
historically. The company has no other maturities until 2023.

A rating upgrade would be likely if the current strong operating
performance continues and the company achieves further debt
reduction including the possible conversion of the convertible
bond. Moody's would also expect NH to maintain its credit profile
at close to current levels with leverage (debt/EBITDA) below
5.0x, coverage (EBITA/interest) approaching 1.5x and cash flow
(RCF/net debt) above 10%, along with adequate liquidity at all
times and no material deterioration in the LTV coverage of the
secured notes.

Negative rating pressure would be precipitated by any operational
reversals such that leverage deteriorates to 6.5x, coverage
reverts to 1.0x and cash flow to net debt drops to 5%. Any
liquidity challenges would also be viewed negatively as would a
material deterioration in the LTV coverage of the secured notes.

Upward pressure on the senior secured notes rating is unlikely in
the near-term. The two-notch uplift for the bond rating from the
corporate family rating reflects support from subsidiary
guarantors, a security package including real assets and a
cushion from convertible bond. With the approaching convertible
bond maturity in November 2018, the support for the instrument
rating will be diminished.

NH Hotel Group S.A. is a top six European hotel company with 379
hotels and over 58,000 rooms managing a portfolio of upscale and
upper upscale hotels in 29 countries including Spain, Italy,
Benelux, Germany and a number of Latin American countries. In
2016, the company reported revenues of EUR1.475 billion.

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


=====================
S W I T Z E R L A N D
=====================


CREDIT SUISSE: Fitch Affirms BB Rating on Additional Tier 1 Notes
-----------------------------------------------------------------
Fitch Ratings has affirmed Credit Suisse Group AG's (CSGAG) Long-
Term Issuer Default Rating (IDR) and Viability Rating (VR) at
'A-' and 'a-', respectively.

At the same time, Fitch has affirmed the ratings of the group's
main operating entity, Credit Suisse AG (Credit Suisse), at IDR
'A' and VR 'a-' and of the group's domestic subsidiary, Credit
Suisse (Schweiz) AG (CS Schweiz) at IDR 'A' and VR 'a'. The
Outlooks are all Stable.

The rating actions have been taken in conjunction with Fitch's
periodic review of the Global Trading and Universal Banks
(GTUBs), which comprise 12 large and globally active banking
groups.

KEY RATING DRIVERS
VR
CSGAG AND CREDIT SUISSE

Credit Suisse accounts for substantially all of CSGAG's
consolidated assets, and their VRs are assessed on a consolidated
basis.

The banks' VRs reflect the group's franchise as one of the
leading global wealth managers with material investment banking
capabilities, and the second-largest universal banking presence
in Switzerland. They also reflect, however, Fitch views that the
company profile acts as a constraint, given the high proportion
of revenue generated by the group's trading, underwriting and
advisory operations, (47% of the group in 1H17), which exposes it
to volatility and cyclicality. CS has a particularly strong focus
on fixed income instruments, and in particular, leveraged finance
and credit, where activity can be cyclical.

Fitch has also taken into account the bank's improving operating
earnings and good progress in cost reductions, which have been
implemented ahead of original plans. Credit Suisse's operating
expenses excluding litigation, restructuring and goodwill
impairment in 2016 were CHF1.8 billion lower yoy (at constant
exchange rates), which compares with an initial net cost savings
target of CHF1.4 billion. The bank targets cumulated net savings
of CHF4.2 billion by end-2018, a material 20% of the 2015 CHF21.2
billion cost base and Fitch believes that it should be able to
deliver on its target.

Positively the bank's future performance is expected to see
smaller losses from the Strategic Resolution Unit (SRU), which
were the main driver depressing the bank's profitability in 1H17.
Fitch expects the group's reported operating earnings to improve
by early 2019 if the SRU reduction is successful, which in Fitch
views is likely given the sound record of maintaining exit costs
within management guidance and reducing assets and costs rapidly.
The bank guided that it expects quarterly pre-tax losses to ease
to around CHF350 million in 2018 and CHF200 million by 2019 (from
CHF1.1 billion in 1H17).

Credit Suisse's wealth management franchises have to date
performed well, with sound net margins on assets under management
and momentum in net new asset growth. Results in 1H17 also
highlighted progress towards the group's targeted levels of
revenue and costs in Global Markets. However, materially lower
client trading activity in Asia Pacific has been denting
profitability and may make reaching divisional targets
challenging.

Credit Suisse's sound capitalisation compares well with GTUB
peers' following a CHF4.1 billion rights issue completed in 2Q17.
By end-2Q17 it had reached a 13.3% fully-loaded Basel III CET1
ratio, a 5.2% Tier 1 leverage ratio and the 2020 Swiss going
concern requirements at end-2Q17. However, Fitch expects the
bank's reinvestment in international wealth management and Asia
Pacific to consume capital, partly to fund lending to wealth
management clients and participate in cross-border mergers and
acquisitions financing. Fitch expects that capitalisation levels
may fluctuate to the bank's medium-term targeted 13% CET1 ratio
and 5% leverage ratio.

Litigation tail risks to capitalisation have materially receded
following the RMBS settlement with the US Department of Justice
in 4Q16, while smaller restructuring and SRU losses should have
less of an impact on capital. Nonetheless, the small size of the
capital base in absolute terms, in relation to the risks related
to the sizeable capital markets businesses, makes the bank
somewhat more vulnerable than peers to external shocks.

These risks are mitigated by sound underwriting standards and
material risk-weighted asset (RWA) reductions in trading
activities and the SRU, which have to date been more than ample
to fund growth in strategic businesses. Credit Suisse's strong
asset quality benefits from a low-risk domestic residential
mortgage portfolio and well-controlled higher risk exposures,
including underwriting corporate transactions, leveraged finance
and wealth management-related shipping and aviation portfolios.
Fitch believes that growth in Asia Pacific has been well-
controlled.

CSGAG's VR is equalised to that of Credit Suisse as Fitch views
holding company double leverage (107% at end-2016 according to
Fitch calculations) as moderate and because of CSGAG's role as
the issuer of total loss-absorbing capacity (TLAC), including AT1
instruments and senior unsecured long-term debt. Fitch expects
the holding company to maintain prudent management of liquidity,
which should be helped by existing policies to manage liquidity
across a large number of legal entities globally.

IDRs, DERIVATIVE COUNTERPARTY RATING AND SENIOR DEBT
CSGAG AND CREDIT SUISSE

Credit Suisse's IDRs and senior debt one notch above the bank's
VR because the buffer of qualifying junior debt and TLAC-eligible
senior holding company debt (around 18% of RWAs at end-2Q17) is
sufficiently large to recapitalise the bank after a resolution
without imposing losses on senior creditors. This compares with
Fitch estimated recapitalisation amount of around 9%, which
represents the difference between minimum going concern capital
requirements (14.3%) and Fitch assumed regulator intervention
point at 6%.

Fitch does not apply this uplift to CSGAG because the quantum of
qualifying junior debt available as a buffer for holding company
senior creditors is insufficient in Fitch views and Fitch does
not expects it to become sufficiently large given the single-
point-of-entry resolution strategy focussed on building up TLAC
in the form of senior holding company debt.

Credit Suisse's Derivative Counterparty Rating (DCR) is at the
same level as the bank's Long-Term IDR because derivative
counterparties have no definitive preferential status over other
senior obligations in a resolution scenario.

Credit Suisse's Short-Term IDR of 'F1' is at the higher of the
two options that map against a Long-Term IDR of 'A-', as group
liquidity is managed and retained at Credit Suisse level. For the
same reason, CSGAG's Short-Term IDR of 'F2' is at the lower of
two options mapping to a Long-Term IDR of 'A-'.

TLAC-eligible senior unsecured debt issued by Credit Suisse Group
Funding (Guernsey) Limited and guaranteed by CSGAG is rated in
line with the guarantor's Long-Term IDR.

VR, IDRs, SENIOR DEBT AND DCR
CS SCHWEIZ

CS Schweiz is Credit Suisse's wholly-owned domestic subsidiary,
whose Long-Term IDR is driven by its VR and reflects its low-risk
domestic loan book, moderate volumes of trading assets, sound
capitalisation and a strong deposit franchise. The ratings also
reflect a strong risk correlation with its parent bank as a
result of Credit Suisse performing a central treasury role, which
caps CS Schweiz's VR at the level of Credit Suisse's Long-Term
IDR.

The DCR is at the same level as CS Schweiz's Long-Term IDR
because derivative counterparties have no definitive preferential
status over other senior obligations in a resolution scenario.

SUPPORT RATING AND SUPPORT RATING FLOOR
CREDIT SUISSE AND CSGAG

CSGAG's and Credit Suisse's Support Ratings (SR) and Support
Rating Floors (SRF) reflect Fitch views that senior creditors of
both the holding and the operating banks can no longer rely on
receiving full extraordinary support from the sovereign in the
event that Credit Suisse becomes non-viable largely due to
progress made in Swiss legislation and regulation to address the
'too big to fail' problem for the two big Swiss banks.

CS SCHWEIZ

CS Schweiz's Support Rating of '1' reflects primarily Fitch views
that the entity is an integral part of Credit Suisse, and whose
default would constitute significant reputational risk to its
parent, thus increasing Credit Suisse's propensity to provide
extraordinary support, if required.

While CS Schweiz makes up a significant part of the group's total
assets and equity, Fitch believes it would be unlikely that the
Swiss regulator would impose significant restrictions on
recapitalising CS Schweiz using resources from the rest of the
group, or on upstreaming capital from other Credit Suisse
subsidiaries where available. CS Schweiz's significant relative
size is further mitigated by Fitch views that the subsidiary's
need for support is unlikely to arise simultaneously with that of
other foreign subsidiaries.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other hybrid securities issued by Credit
Suisse, CSGAG and by various issuing vehicles are all notched
down from Credit Suisse's and CSGAG's VRs in accordance with
Fitch's assessment of each instrument's respective non-
performance and relative loss severity risk profiles, which vary
considerably.

Subordinated lower Tier 2 debt is rated one notch below the VR
for loss severity, reflecting below-average recoveries.

Low trigger contingent capital Tier 2 notes are rated two notches
below the VR, reflecting loss severity, due to contractual full
and permanent write-down language.

Upper Tier 2 instruments are rated three notches below the VR,
comprising one notch for loss severity and two notches for
incremental non-performance risk due to cumulative coupon
deferral.

High trigger contingent capital Tier 2 notes are rated four
notches below the VR. The notes are notched down twice for loss
severity, reflecting poor recoveries as the instruments can be
converted to equity or written down well ahead of resolution. In
addition, they are notched down twice for high non-performance
risk, as the trigger can result in contractual loss absorption
ahead of non-viability.

Legacy Tier 1 securities are rated four notches below the VR,
comprising two notches for higher-than-average loss severity, and
two further notches for non-performance risk due to partly
discretionary coupon omission.

High and low trigger contingent capital Tier 1 instruments are
rated five notches below the VR. The issues are notched down
twice for loss severity, reflecting poor recoveries as the
instruments can be converted to equity or written down well ahead
of resolution. In addition, they are notched down three times for
very high non-performance risk due to fully discretionary coupon
omission.

SUBSIDIARIES AND AFFILIATED COMPANIES

Credit Suisse International (CSI) is a UK-based wholly-owned
subsidiary of Credit Suisse, and Credit Suisse (USA) Inc. (CSUSA)
is a US holding company directly held by Credit Suisse Holdings
(USA), Inc., the group's US intermediate holding company (IHC).
Fitch view these entities as integral to the group's business and
core to Credit Suisse's strategy and their Long-Term IDRs are
aligned with Credit Suisse's VR.

Fitch has not applied a one-notch uplift to their IDRs and DCRs
as Fitch does not believe that at present these foreign
subsidiaries have had a sufficient qualifying junior debt,
including internal TLAC, allocated to them to ensure their
recapitalisation in a resolution event. The Positive Outlook on
CSUSA's Long-Term IDR reflects Fitch views that the Fed's final
rules on internal TLAC are likely to result over time in material
amounts of internal loss-absorbing debt being down-streamed.

CSI is incorporated as an unlimited liability company, which
underpins Fitch's view of an extremely high probability of
support from its parent, if needed. However, Fitch has not
applied the one-notch uplift because it is not clear what impact
unlimited liability status would have in protecting senior
creditors in a resolution event. At end-1H17, CSI's Tier 2 buffer
of around 6% of RWAs was insufficient to recapitalise the entity
without imposing losses on senior creditors.

CSI's DCR is at the same level as the entity's Long-Term IDR
because derivative counterparties have no definitive preferential
status over other senior obligations in a resolution scenario in
the UK.

CSI's and CSUSA's Short-Term IDRs of 'F1', the higher of two
Short-Term IDRS mapping to an 'A-' Long-Term IDR, reflect the
benefits for the subsidiaries of the group's central treasury
approach and strong funding and liquidity at Credit Suisse level.

The IDRs of Credit Suisse New York branch are at the same level
as those of Credit Suisse as the branch is part of the same legal
entity without any country risk restrictions. The alignment of
IDRs reflects Fitch views that senior creditors of the branch
would be treated identically to other senior creditors of Credit
Suisse.

RATING SENSITIVITIES
VRS
CSGAG AND CREDIT SUISSE

Material deviation from capital, cost and non-core asset
reduction targets, as well as greater-than-expected asset risk
from growth in international wealth management, would put
pressure on the group's VRs.

Upside to the ratings could arise in the medium term conditional
on continued strong implementation on cost and non-core asset
reductions that would bring profitability more in line with the
group's underlying capacity, together with unchanged
capitalisation and risk appetite.

IDRs, DCR AND SENIOR DEBT
CSGAG AND CREDIT SUISSE

CSGAG's and Credit Suisse's Long-Term IDRs are primarily
sensitive to a change in the VRs. The Stable Outlook reflects
Fitch views that the group will continue to successfully
implement its strategy and that qualifying junior debt buffers at
the CSGAG level are unlikely to be sufficient to allow us to
notch up the Long-Term IDR from the VR, given Switzerland's
single-point-of-entry approach to bank resolution. In respect of
Credit Suisse, the Long-Term IDR is sensitive to maintaining
sufficient qualifying junior debt and down-streamed TLAC to
continue to protect senior creditors.

DCRs are primarily sensitive to changes in the respective
issuers' Long-Term IDRs. In addition, they could be upgraded to
one notch above the IDR if a change in legislation creates legal
preference for derivatives over certain other senior obligations,
and if in Fitch's view, the volume of all legally subordinated
obligations provides a substantial enough buffer to protect
derivative counterparties from default in a resolution scenario.

TLAC senior notes are rated in line with CSGAG's Long-Term IDR
and are therefore primarily sensitive to a change to the Long-
Term IDR.

VR, IDRs, SENIOR DEBT AND DCR
CS SCHWEIZ

A longer track record of strong and stable earnings and
capitalisation could provide upside to CS Schweiz's VR, provided
it is no longer constrained at the same level by large unsecured
exposures to Credit Suisse. Conversely, weaker capitalisation or
asset quality or reduced earnings stability than Fitch currently
expect, or a downgrade of Credit Suisse's Long-Term IDR, would
put pressure on CS Schweiz's VR.

CS Schweiz's Long-Term IDR and DCR could be rated above the VR if
Fitch believes buffers of qualifying junior debt and internal
loss-absorbing capacity pre-placed at the CS Schweiz level are
sufficient to result in a significantly lower risk of default on
CS Schweiz's senior obligations than the risk of the bank
failing. For this to happen Fitch would has to conclude that CS
Schweiz could reach a higher Long-Term IDR were the buffers in
the form of Fitch core capital, which is unlikely given the close
risk correlation with its parent. Clear requirements on internal
buffers at CS Schweiz ensuring their permanence would also be
necessary for its Long-Term IDR to be rated above its VR.

SUPPORT RATING AND SUPPORT RATING FLOOR
Credit Suisse and CSGAG

An upgrade to Credit Suisse's or CSGAG's SRs and an upward
revision to the SRFs would be contingent on a positive change in
Switzerland's propensity to support its banks. This is highly
unlikely in Fitch views, though not impossible.

CS Schweiz
The SR is sensitive to changes in Fitch assessments of Credit
Suisse's ability to provide extraordinary support to CS Schweiz
as well as the importance of CS Schweiz to the rest of the group.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other hybrid capital ratings are primarily
sensitive to a change in the VRs of Credit Suisse or CSGAG. The
securities' ratings are also sensitive to a change in their
notching, which could arise if Fitch changes its assessment of
the probability of their non-performance relative to the risk
captured in the respective issuers' VRs. This may reflect a
change in capital management in the group or an unexpected shift
in regulatory buffer requirements, for example.

SUBSIDIARIES AND AFFILIATED COMPANIES

CSI's and CSUSA's Long-Term IDRs are sensitive to changes in the
parent bank Credit Suisse's VR. The subsidiaries' Long-Term IDRs
could benefit from a one-notch uplift if Fitch believes that
sufficient TLAC will be down-streamed from the parent to the
subsidiaries to recapitalise them sufficiently in a resolution
event.

Fitch expects internal TLAC requirements to become binding for
Credit Suisse's US IHC from January 1, 2019. Once sufficient debt
buffers are pre-placed, this could result in CSUSA's Long-Term
IDR being upgraded by one notch and aligned with Credit Suisse's.

Similarly, sufficient qualifying junior debt buffers and internal
loss-absorbing debt pre-placed at CSI, along with clear
regulatory incentives to maintain these, could lead to a one-
notch upgrade of its Long-Term IDR.

The subsidiaries' IDRs are sensitive to adverse changes in the
parent's propensity to provide support.

The rating actions are:

Credit Suisse Group AG:
Long-Term IDR: affirmed at 'A-'; Outlook Stable
Short-Term IDR: affirmed at 'F2'
Viability Rating: affirmed at 'a-'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Senior unsecured debt (including programme ratings): affirmed at
'A-'/'F2'
Senior market-linked notes: affirmed at 'A-emr'
Subordinated notes: affirmed at 'BBB+'
Additional Tier 1 notes: affirmed at 'BB'

Credit Suisse:
Long-Term IDR: affirmed at 'A'; Outlook Stable
Short-Term IDR: affirmed at 'F1'
Derivative Counterparty Rating: affirmed at 'A(dcr)'
Viability Rating: affirmed at 'a-'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Senior unsecured debt (including programme ratings): affirmed at
'A'/'F1'
Senior market-linked notes: affirmed at 'Aemr'
Subordinated lower Tier 2 notes: affirmed at 'BBB+'
Subordinated notes: affirmed at 'BBB'

Credit Suisse (Schweiz) AG
Long-Term IDR: affirmed at 'A'; Outlook Stable
Short-Term IDR: affirmed at 'F1'
Derivative Counterparty Rating: affirmed at 'A(dcr)'
Viability Rating: affirmed at 'a'
Support Rating: affirmed at '1'

Credit Suisse International:
Long-Term IDR: affirmed at 'A-'; Outlook Stable
Short-Term IDR: affirmed at 'F1'
Derivative Counterparty Rating: affirmed at 'A-(dcr)'
Support Rating: affirmed at '1'
Senior unsecured debt including programme rating affirmed at 'A-
'/'F1'

Credit Suisse (USA) Inc.:
Long-Term IDR: affirmed at 'A-', Outlook Positive
Short-Term IDR: affirmed at 'F1'
Support Rating: affirmed at '1'
Senior unsecured debt (including programme ratings): affirmed at
'A-'
Commercial paper programme: affirmed at 'F1'

Credit Suisse NY (branch):
Long-Term IDR: affirmed at 'A', Outlook Stable
Short-Term IDR: affirmed at 'F1'
Senior unsecured debt (including programme ratings): affirmed at
'A'
Commercial paper programme: affirmed at 'F1'
Senior market-linked notes: affirmed at 'Aemr'

Credit Suisse Group Funding (Guernsey) Limited
Senior unsecured notes (with TLAC language): affirmed at 'A-
'/'F2'

Credit Suisse Group (Guernsey) II Limited
Tier 1 buffer capital perpetual notes: affirmed at 'BB'


UBS GROUP: Fitch Raises Rating on Tier 1 Sub. Notes From BB+
------------------------------------------------------------
Fitch Ratings has upgraded UBS Group AG's Long-Term Issuer
Default Rating (IDR) to 'A+' from 'A' and UBS AG's and UBS
Switzerland AG's Long-Term IDRs to 'AA-' from 'A+'. Fitch has
also upgraded all three entities' Viability Ratings (VRs) to 'a+'
from 'a'. The Short-term IDRs of UBS AG and of UBS Switzerland AG
have been upgraded to 'F1+' from 'F1'; the Short-Term IDR of UBS
Group AG has been affirmed at 'F1'. The Rating Outlook on UBS
Group AG's Long-term IDR has been revised to Stable from
Positive; the Outlooks on UBG AG's and on UBS Switzerland AG's
Long-term IDRs are Stable.

The rating action reflects the improvements the bank has made in
its business, by reducing tail risk through tightened risk
controls, which should allow it to generate sound and less
volatile earnings. UBS AG's and UBS Switzerland AG's IDRs
continue to be rated above their VRs to reflect the pre-placement
of a sufficient buffer of junior debt and loss absorbing capacity
to protect senior creditors.

The rating actions have been taken in conjunction with Fitch's
periodic review of the Global Trading and Universal Banks
(GTUBs), which comprise 12 large and globally active banking
groups.

KEY RATING DRIVERS
VRs

UBS AG and UBS Switzerland AG have common VRs as Fitch believes
that the credit profiles of the two operating entities will
remain closely connected, at least for as long as UBS Switzerland
AG remains a subsidiary of UBS AG. UBS Switzerland AG's large
size, with just under CHF300 billion total assets under Swiss
GAAP, in relation to UBS AG's consolidated assets also drives the
common VR.

The two entities continue to be closely integrated despite the
gradual wind-down of the joint and several liability assumed for
various contractual obligations. At end-1H17, UBS Switzerland AG
continued to assume joint liability for about CHF80 billion of
contractual obligations of UBS AG. The joint liability of UBS AG
for obligations of UBS Switzerland AG at the same date was
immaterial.

The VRs reflect the group's well-defined and implemented strategy
to remain a leading global asset gatherer, while maintaining a
leading position in domestic personal and corporate banking
activities and running a sizeable investment bank. The group has
reduced its risk profile by tightening controls and outlining a
clearly defined risk appetite. It has strengthened its balance
sheet by building up capital and reducing tail risk by exiting
businesses that it considers higher-risk and no longer strategic.
Funding and liquidity are strong and stable and benefit from the
group's global wealth management operations, as well as a strong
domestic retail and commercial banking franchise.

However, a factor of high importance in Fitch assessments of the
VR is the business model, which is relatively complex and reliant
on market sentiment and customer transaction volumes, both of
which contribute to earnings volatility. This constrains the VR
of UBS Group AG within the 'a' range because of the continued
material weighting of capital markets in the group's business
model. Fitch believes that the bank's presence in this field
represents a medium- to long-term strategy as it supports the
group's leading global wealth management presence, particularly
for ultra-high net worth individuals.

Market conditions in most of its businesses, including wealth
management and domestic banking, have remained challenging in
2017 because of a low interest rate environment, although the
bank is benefiting from higher domestic interest rates in the
U.S. The bank has addressed the pressure on margins with a plan
to reduce net costs in the bank by CHF2.1 billion p.a. by end-
2017, and is well on its way to meeting this target. Fitch
believes the actions taken so far have enabled the bank to
generate robust and stable earnings, particularly when
restructuring charges, which have been significant, subside.

Provisions for litigation, regulatory and similar matters have
been material and Fitch expects them to remain a drag on
earnings, given pending legal cases and regulatory
investigations. While the extent of further litigation costs is
hard to predict, the ratings factor in Fitch assumptions that the
bank's litigation reserves and capitalisation, if required, could
absorb sizeable further misconduct and litigation costs.

Capital ratios based on risk-weighted assets (RWAs) are in line
with the bank's risk appetite, in Fitch views. UBS Group AG
reported a consolidated 13.5% fully-applied Basel III common
equity Tier 1 (CET1) ratio at end-1H17. Fitch believes that this
could fall slightly as the bank targets a minimum ratio of 13%.
Leverage is a greater constraint, however. Fitch expects the
group's leverage ratio to continue to improve as the group
retains earnings and issues additional high-trigger Tier 1 (AT1)
instruments to meet the Swiss regulatory requirement of a minimum
5% going concern leverage ratio from 1 January 2020.

Fitch's ratings reflects Fitch views that the group is well on
its way to meeting the new requirements for going- and gone-
concern capital, as per Swiss too-big-to-fail regulations for the
country's two global systemically important banks (G-SIBs).

Fitch expects the group to continue to manage capital and funding
on a group-wide basis, but regulatory requirements for individual
legal entities will, in Fitch opinions, result in an increasing
focus on local capital and liquidity requirements.

Fitch has equalised UBS Group AG's VR with the common VR of UBS
AG and UBS Switzerland AG because of UBS Group AG's role as the
group's holding company and the issuer (or guarantor) of total
loss-absorbing capacity (TLAC), including AT1 instruments and
senior unsecured long-term debt. Holding company double leverage
is low at present and while this may fluctuate, Fitch does not
expects it to exceed 120%, a level at which Fitch would considers
notching the holding company's VR below the operating banks' VRs.
Fitch expects the holding company to maintain prudent management
of liquidity, which should be helped by existing policies to
manage liquidity across a large number of legal entities
globally.

IDRS, DCR AND SENIOR DEBT

Fitch rates UBS AG's and UBS Switzerland AG's IDRs and senior
debt ratings one notch above the VRs because Fitch believes that
the group's buffer of qualifying junior debt (QJD), combined with
senior debt issued by the holding company, is sufficient to
protect their senior obligations from default in case of failure,
either under a resolution process or as part of a private sector
solution (such as a distressed debt exchange) to avoid a
resolution action. Fitch therefore views the risk of default on
UBS AG's and UBS Switzerland AG's senior obligations, as measured
by the Long-Term IDRs, is lower than the risk of the banks
failing, as measured by the VRs.

Fitch's assumption is that absent a private sector solution, a
resolution action is taken on UBS group if it breaches a CET1
ratio of 6% (after high-trigger capital instruments but before
low-trigger capital instruments have been triggered). Fitch
assumes that the regulator would require the group to be
recapitalised to a CET1 ratio of above 14.3% on a consolidated
basis. This means that the group's 10% minimum CET1 ratio and
4.3% Tier 1 high-trigger capital buffer would be met with CET1
capital post-resolution as the group at that point would in Fitch
opinions not be in a position to issue capital instruments in the
market.

Fitch's view of the regulatory intervention point and post-
resolution capital needs together suggests that a combined buffer
of QJD and holding company senior debt of above 9% of RWAs could
be required to restore viability without imposing losses on the
operating companies' senior creditors.

At end-1H17, UBS's QJD and holding company senior debt buffer
amounted to about CHF42 billion, equal to 17% of RWAs or 4.8% of
leverage exposure. This amount, in Fitch's opinion, should be
sufficient to recapitalise the group in a resolution scenario to
meet adequate CET1 and leverage ratios. Fitch believes that the
revised Swiss going- and gone-concern capital requirements
provide strong and transparent incentives to ensure that these
buffers remain in place.

Fitch has not applied this one-notch uplift to the IDR of UBS
Group AG as its QJD buffer is insufficient to recapitalise it to
minimum requirements. Fitch also does not expects it to become
sufficiently large given the single-point-of-entry resolution
strategy based on issuing external senior debt at holding company
level and down-streaming it to operating companies. Consequently,
its IDR is at the same level as its VR.

UBS AG's, UBS Switzerland AG's Short-Term IDRs are 'F1+', the
rating which maps to a Long-Term IDR of 'AA-' and which reflects
the high liquidity held at the operating companies. The Short-
term IDR of UBG Group has been affirmed at 'F1'.

The DCRs assigned to UBS AG and UBS Switzerland AG are in line
with their respective IDRs because derivative counterparties in
Switzerland have no definitive preferential status over other
senior obligations in a resolution scenario.

SUPPORT RATING AND SUPPORT RATING FLOOR

The Support Ratings and Support Rating Floors reflect Fitch's
view that senior creditors can no longer rely on receiving full
extraordinary support from the sovereign in the event that UBS
Group AG, UBS AG or UBS Switzerland AG become non-viable.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other junior and hybrid capital issued by
UBS Group AG, UBS AG and its affiliates are all notched down from
UBS AG's or UBS Group AG's VRs in accordance with Fitch's
assessment of each instrument's respective non-performance and
relative loss severity risk profiles, which vary considerably.

Legacy subordinated lower Tier 2 debt is rated one notch below
the VR for loss severity, reflecting below-average recoveries.

Low trigger contingent capital Tier 2 notes are rated two notches
below the VR, reflecting loss severity in the form of contractual
full and permanent write-down language.

Legacy Tier 1 securities are rated four notches below the VR,
comprising two notches for loss severity, and two further notches
for non-performance risk due to partly discretionary coupon
omission.

High and low trigger additional Tier 1 instruments are rated five
notches below the VR. The notes are notched twice for loss
severity, and three times for non-performance risk due to fully
discretionary coupon omission.

SUBSIDIARIES AND AFFILIATED COMPANIES

London-based UBS Limited is a wholly owned subsidiary of UBS AG.
Its Support Rating, IDR, DCR and debt ratings reflect Fitch's
view that UBS Limited is a key part of the UBS group and
integrated into its investment banking activities.

UBS Limited's contractual counterparties continue to benefit from
an irrevocable and unconditional guarantee by UBS AG, which
further supports Fitch views that the subsidiary is an integral
part of the group's business. Fitch therefore see an extremely
high probability that UBS AG would support it if needed, leading
to the equalisation of their IDRs and debt ratings. The DCR
assigned to UBS Limited is in line with its IDR as Fitch believes
UK legislation provides no explicit protection to derivative
counterparties relative to other senior creditors.

UBS Bank USA is a direct subsidiary of UBS Americas Inc., which
in turn is wholly owned by UBS AG through UBS Americas Holdings
LLC. The Support Rating and Short-Term IDR reflect Fitch's view
of UBS Bank USA's integration and important role within the group
would mean an extremely high probability of support from UBS
Group in case of need.

RATING SENSITIVITIES
VR

Given the group's business model constraints, Fitch does not
believes that the VRs of UBS Group AG, UBS AG and UBS Switzerland
AG could be upgraded further in the medium term. On the other
hand, the VRs could be under pressure if the bank's revenue and
earnings demonstrate excessive vulnerability to market
volatility, which could be indicated by losses in the investment
bank business division arising from spikes in market volatility
or earnings volatility exceeding that of its global peers,
neither of which Fitch currently expects.

Ratings would also be downgraded if misconduct and litigation
costs are higher than Fitch expectations and affect the group's
capitalisation with no credible plan for restoring it over a
reasonably short period. Material restrictions on the group's
ability to conduct businesses, which could be the result of
penalties by authorities, would also put ratings under pressure.

UBS Switzerland AG's VR is also sensitive to a change in the
subsidiary's integration in the group. Should it become less
integrated, which could occur if higher-than-expected amounts of
regulatory capital are trapped in the subsidiary, the VRs could
diverge. A material reduction in UBS Switzerland AG's exposure to
the parent, or the complete run-off of the joint and several
liability arrangements between the two entities could also result
in rating differentiation over time. Fitch expects capital in
excess of regulatory requirements and the management buffer to be
up-streamed to UBS AG, at least for as long as the group entities
remain strongly investment-grade.

Changes to UBS group's structure, including changes to UBS
Switzerland AG's ownership structure, could also result in rating
differentiation in the VRs if Fitch concludes that this reduces
UBS Switzerland AG's, UBS AG's and other group entities'
integration with each other. The group has stated that it is
considering further changes to its legal structure, which could
include the transfer of operating subsidiaries of UBS AG to
become direct subsidiaries of UBS Group AG and the creation of
additional subsidiaries.

In addition to the factors above, UBS Group AG's VR could be
notched down from UBS AG's VR if double leverage at the holding
company increases above 120% or if the role of the holding
company changes.

IDRs, DCRs AND SENIOR DEBT

UBS Group AG's IDRs are primarily sensitive to a change in the
group's VR. In addition, UBS AG's and UBS Switzerland AG's IDRs
are sensitive to the presence of sufficient QJD to recapitalise
the banks to the minimum requirements of the regulators.

DCRs and senior notes are rated in line with the various UBS
companies' respective Long-Term IDRs and are therefore primarily
sensitive to a change to the IDRs.

SUPPORT RATING AND SUPPORT RATING FLOOR

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

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

The ratings of UBS AG's and UBS Group AG's subordinated and
hybrid debt issues are primarily sensitive to a change in the
respective issuers' VRs. The securities' ratings are also
sensitive to a change in their notching, which could arise if
Fitch changes its assessment of the probability of their non-
performance relative to the risk captured in the respective
issuers' VRs. This may reflect a change in capital management in
the group or an unexpected shift in regulatory buffer
requirements, for example.

SUBSIDIARIES AND AFFILIATED COMPANIES

The ratings of UBS Limited are primarily sensitive to a change in
UBS AG's IDRs. In addition, should regulatory developments lead
to the subsidiary becoming less integrated within UBS AG, e.g.
through restrictions on intragroup funding flows, this could
result in a downgrade of the UK subsidiary.

UBS Bank USA's Short-Term IDR, which is derived from the bank's
implicit Long-Term IDR, is primarily sensitive to UBS AG's
ability and propensity to support the subsidiary. Its ability is
primarily sensitive to a change in UBS AG's VR and any regulatory
restrictions placed on capital or liquidity supply from UBS AG.
Its propensity to support it is driven by the subsidiary's
importance and role in the group.

Fitch has taken the following rating actions:

UBS Group AG
-- Long-Term IDR upgraded to 'A+' from 'A'; Outlook Stable;
-- Short-Term IDR affirmed at 'F1';
-- Viability Rating upgraded to 'a+' from 'a';
-- Support Rating affirmed at '5';
-- Support Rating Floor affirmed at 'No Floor';
-- Tier 1 subordinated notes (high-trigger) upgraded to 'BBB-'
    from 'BB+';
-- Tier 1 subordinated notes (low-trigger') upgraded to 'BBB-'
    from 'BB+'.

UBS AG
-- Long-Term IDR upgraded to 'AA-' from 'A+' Outlook Stable;
-- Short-Term IDR upgraded to 'F1+' from 'F1';
-- Viability Rating upgraded to 'a+' from 'a';
-- Support Rating affirmed at '5';
-- Support Rating Floor affirmed at 'No Floor' ;
-- Long- and short-term senior unsecured debt: upgraded to 'AA-
    '/'F1+' from 'A+'/'F1';
-- Senior unsecured market linked securities upgraded to
    'AA-emr' from 'A+emr';
-- Derivative Counterparty Rating upgraded to 'AA-dcr' from
    'A+dcr';
-- Subordinated debt upgraded to 'A' from 'A-';
-- Tier 2 subordinated notes (low-trigger loss-absorbing notes)
    upgraded to 'A-' from 'BBB+';
-- Commercial paper upgraded to 'AA-'/'F1+' from 'A+'/'F1';

UBS Switzerland AG
-- Long-Term IDR upgraded to 'AA-' from 'A+'; Outlook Stable;
-- Short-Term IDR upgraded to 'F1+' from 'F1';
-- Viability Rating upgraded to a+' from 'a';
-- Support Rating affirmed at '5';
-- Support Rating Floor affirmed at 'No Floor';
-- Derivative Counterparty Rating upgraded to 'AA-(dcr) from
    'A+(dcr)'.

UBS Limited
-- Long-Term IDR upgraded to 'AA-' from 'A+'; Outlook Stable;
-- Short-term IDR upgraded to 'F1+' from 'F1';
-- Support Rating affirmed at '1';
-- Derivative Counterparty Rating upgraded to 'AA-(dcr) from
    'A+(dcr)'.

UBS Bank USA
-- Short-Term IDR affirmed at 'F1';
-- Support Rating affirmed at '1'.

UBS Capital Securities (Jersey Ltd)
-- Preferred securities upgraded to 'BBB' from 'BBB-'.

UBS Group Funding (Switzerland) AG
-- Senior long-term unsecured programme and notes upgraded to
    'A+' from 'A';
-- Senior short-term unsecured programme and notes affirmed at
    'F1'.

Fitch has also withdrawn the ratings on two market-linked notes
issued by UBS AG because there is insufficient information to
maintain the ratings on these issues.

-- Market-linked USD0.02 million equity linked notes due
    Feb. 22, 2018, ISIN XS0338695173, rated 'a+(emr); rating
    withdrawn;
-- Market-linked JPY10 billion dual currency notes, due Aug. 10,
    2038, rated 'a+(emr); rating withdrawn.


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


BARCLAYS PLC: Fitch Affirms BB+ Basel III-Compliant Debt Rating
---------------------------------------------------------------
Fitch Ratings has affirmed Barclays plc's (B plc) Long- and
Short-Term Issuer Default Ratings (IDR) at 'A'/'F1' and Viability
Rating (VR) at 'a'. The Long-Term 'A' IDR of Barclays Bank Plc
(BB plc) has been placed on Rating Watch Positive (RWP).

Fitch has also assigned expected ratings to Barclays Bank UK plc
(BBUK plc), the entity which will become the domestic ring-fenced
bank, at Long- and Short-Term IDR 'A+(EXP)'/'F1(EXP)' and VR
'a(EXP)'. The Outlook on the IDR is Stable.

The RWP on BB plc's IDR reflects Fitch expectations that the bank
will over the next six to 12 months have received sufficient
senior debt from its parent holding company, which will become
junior to BB plc's external senior debt. Fitch believes that this
will be achieved soon after the bank receives clarification from
the UK's resolution authority, the Bank of England, on how to
structure the subordination of this debt so that it protects the
bank's external creditors in case of failure and qualifies for
internal minimum requirement for own funds and eligible
liabilities (MREL). At that point Fitch expects to upgrade the
IDR of BB plc by one notch to 'A+'.

The rating actions have been taken in conjunction with Fitch's
periodic review of the Global Trading and Universal Banks (GTUB),
which comprises 12 large and globally active banking groups.

A full list of rating actions is available at the end of this
rating action commentary.

KEY RATING DRIVERS
VRs
BARCLAYS PLC AND BARCLAYS BANK PLC

B plc and BB plc's VRs are analysed on a consolidated basis and
are equalised because of B plc's role as a holding company and
the absence of common equity double leverage. Fitch expects the
holding company to maintain prudent management of liquidity,
which should be helped by existing policies to manage liquidity
across a large number of legal entities globally.

Their VRs are underpinned by strong franchises in domestic retail
and commercial banking, in the group's UK and US cards as well as
sound franchises in selected investment banking businesses
primarily in the UK and the US. While Fitch views the group's
business model as diversified, a high share of capital markets
businesses, which Fitch regards as more volatile, caps Fitch
company profile assessment. Fitch views this as a factor of high
importance in assessing the bank's ratings.

BB plc's capitalisation is broadly in line with European GTUB
peers', after having been boosted by the proportional
deconsolidation of the African operations in 1H17 and the sale of
various non-core assets over past quarters. Its reported CET1
ratio of 13.1% is in the range within which the group expects to
operate, which has been set at 150bps-200bps above known
regulatory requirements.

Fitch expects further modest regulatory capital ratio accretion
through the full regulatory deconsolidation of Barclays Africa
Group Limited (BAGL) (26bp CET1 by end-2018 according to the
bank) and possibly further rundown of risk-weighted assets (RWAs)
previously assigned to the non-core unit, although these are
likely to be limited.

Therefore an improvement to profitability will be crucial to
offset the impact of any possible further litigation or
extraordinary charges and allow the group to follow through with
its aim of expanding in certain capital markets businesses to
reinforce its franchise. The bank has temporarily reduced its
pay-out ratio but Fitch expects this to return to competitive
levels in the future.

The group's earnings are modest for the rating level, and
management's plans to improve returns towards the newly stated
target of above 10% of tangible equity may be challenging to
achieve given a slowing domestic economy and pressure on
operating expenses from Brexit.

Earnings are supported by high-margin credit card businesses in
the UK and US, fee share gains in underwriting and advisory in
the corporate and investment bank as well as from the cyclically
low cost of risk and weaker sterling versus the US dollar.
However, over the last years and in 1H17 underlying profitability
offered only a limited buffer to absorb charges for previous
misconduct, structural transformation costs and deleveraging
costs, and the resulting net performance lagged US and some
European GTUB peers.

Full year profitability for 2017 will be weakened by a GBP1.2
billion attributable loss reported in 1H17, which included a
GBP2.5 billion charge relating to the sale of BAGL and additional
UK customer redress provisions (PPI) of GBP700 million.

BB plc's loan quality is generally sound, with low levels of
impairments, low concentrations and controlled exposure to
higher-risk sectors. Fitch believes that BB plc's NPLs are at a
cyclical low, underpinned by a benign economic environment and
low interest rates in the group's key markets - the UK and US. A
high share of unsecured lending in the UK and US exposes it to
some loan quality deterioration if the economic environment
worsens in the UK, and if interest rates increase in the US. But
overall Fitch expects the group's moderate risk appetite, and a
reduced footprint in countries with weaker asset quality, to help
maintain adequate overall loan-quality metrics.

The group's funding profile is well-matched and diversified. It
benefits from the group's UK retail franchise to fund retail
assets and good market access to fund wholesale operations.
Liquidity is ample, with a loan coverage ratio (LCR) at 149% and
an available liquidity pool of GBP201 billion at end-1H17, well
above requirements. Fitch expects the cost of funding to benefit
from maturing and early redemption of legacy wholesale funding,
though this may in the longer term be offset as the group looks
to replace GBP10 billion of Bank of England term funding scheme
loans and continues to issue total loss-absorbing capacity (TLAC)
in the market, in an environment where interest rates are set to
rise.

BARCLAYS BANK UK PLC

BBUK plc's VR reflects the entity's simple retail and SME banking
business model, strong funding profile dominated by granular
deposits and solid asset quality. Fitch expects integration with
the sister company BB plc to be strong, notwithstanding increased
regulatory restrictions on capital and funding transfers and the
requirement to maintain separate management and governance
structures. Integration, translating into ordinary support, will
be driven by common group management and strategy, group-wide
deployment of excess capital, and access to group know how and
systems through the newly set up service company.

Fitch expects BBUK plc's capital management to follow the
principles applied at group level of maintaining a 150bp-200bp
buffer above regulatory capital requirements and to make
available any surplus capital over this target for dividend
distributions and re-deployment within the group.

Fitch expects BBUK plc's earning assets to consist mainly of
loans, with an overall sound quality, little exposure to cyclical
or distressed sectors but high correlation with UK economic
indicators. The bank will inherit some low-yielding assets
previously classified as non-core, but Fitch expects their impact
on asset quality to be neutral.

Loans will consist mainly of UK retail mortgages, which benefit
from conservative underwriting standards and which have performed
well through the last economic downturn. The bank will also
contain the group's UK credit card and consumer unsecured
lending, which are inherently higher-risk, but adequately
remunerated and benefit from Barclays' long experience and good
market positioning. SME loans (primarily loans to borrowers with
turnover of less than GBP6.5 million) will also be transferred to
BBUK plc and these are expected to be fairly granular as larger
exposures will remain outside the ring-fence.

Given BBUK plc's purely domestic focus, Fitch expects the
performance of the bank's loan book to be correlated with the UK
economy. Some increased non-performance and larger loan loss
rates are likely if the economy slows down following Brexit, but
this will be from low levels and mitigated by a moderate risk
appetite.

BBUK plc's earnings generation capacity is underpinned by a high-
margin credit card business, solid franchise in retail and SME
lending, and good use of digital channels. Overall Fitch expects
underlying earnings to be fairly stable, more so than those of
its sister bank. However, UK retail businesses have incurred high
costs for customer redress, especially for mis-selling payment
protection insurance (PPI), which remain difficult to predict
ahead of the August 2019 submission deadline and may continue to
dent net profits.

BBUK plc's funding will be mostly from customer deposits, mainly
retail but with some SMEs and wealth management, which are
expected to remain stable and loyal reflecting Barclays' strong
brand in the domestic market. The bank will also have access to
secured funding markets (ABS and covered bonds) and will have
internal MREL provided by the holdco. Fitch expects the balance
sheet to have adequate volumes of liquid assets and additionally
the bank to have access to ordinary liquidity support from the
group.

IDRS, SENIOR DEBT and DCR
BARCLAYS PLC AND BARCLAYS BANK PLC

The Long-Term IDR and senior debt ratings of BB plc have been
placed on RWP to reflect the large volumes which B plc has issued
so far in the form of hybrid additional tier 1 (AT1) instruments,
tier 2 debt and senior debt ahead of being subject to a MREL
requirement communicated by the Bank of England of 28.5% of RWAs
by 2022. While currently debt and capital issued by the holding
company are down-streamed in mirror instruments to BB plc Fitch
expects that the down-streamed senior debt to become subordinated
to the senior obligations issued externally and to become
eligible for the proposed TLAC requirements. At that point,
subject to sufficient amounts being issued and pre-placed, Fitch
expects BB plc's IDR to be rated one notch above the bank's VR.

Fitch does not expects to assign an uplift to B plc's IDR as
Fitch does not expect the bank to build up a sufficient amount of
subordinated debt to allow for such an uplift.

The DCR assigned to BB plc is at the same level as its Long-Term
IDR because derivative counterparties have no definitive
preferential status over other senior obligations in a resolution
scenario in the UK.

BARCLAYS BANK UK PLC

BBUK plc's expected IDR is based on Fitch expectations that the
group will have injected into the bank sufficient amount of
qualifying junior debt (QJD) to confer protection to its external
senior obligations if the bank fails. This results in a one notch
uplift of the expected IDR above its VR. A DCR has been assigned
at the same level as the Long-Term IDR.

SUPPORT RATING (SR) AND SUPPORT RATING FLOOR (SRF)
BARCLAYS BANK AND BARCLAYS PLC

BB plc's and B plc's SRs and SRFs reflect Fitch's view that
senior creditors of the bank and the holding company cannot rely
on extraordinary support from the sovereign in the event that BB
plc becomes non-viable. In Fitch opinions, the UK has implemented
legislation and regulations to provide a framework that is likely
to require senior creditors to participate in losses for
resolving even large banking groups.

BARCLAYS BANK UK

BBUK plc's SR of 1 reflects Fitch views of an extremely high
probability of institutional support being made available from B
plc and indirectly BB plc given the ring-fenced bank's strategic
role in the group and reputational considerations. Despite its
size Fitch believes that support would be manageable.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
BARCLAYS BANK AND BARCLAYS PLC

Subordinated debt and other hybrid capital issued by BB plc and B
plcs are all notched down from their respective VRs, in
accordance with Fitch's assessment of each instrument's
respective non-performance and relative loss severity risk
profiles, which vary considerably.

B plc's and BB's subordinated (lower) Tier 2 debt is rated one
notch below the VRs for loss severity, reflecting below-average
recoveries. BB plc's upper Tier 2 instruments are rated three
notches below the VR, comprising one notch for loss severity and
two notches for incremental non-performance risk, reflecting
cumulative coupon deferral.

High trigger contingent capital Tier 2 issued by BB plc are rated
four notches below the VR of B plc as their terms reference group
capitalisation and dividend payments. The notes are notched down
twice for loss severity, reflecting loss absorption if the bank
breaches a 7% CRD IV transitional (FSA October 2012 statement)
CET1 ratio. In addition, they are notched down twice for non-
performance risk.

High-trigger contingent capital Tier 1 instruments and preference
shares with no constraints on coupon omission are rated five
notches below the VRs. The issues are notched down twice for loss
severity, reflecting poor recoveries as the instruments can be
converted to equity or written down well ahead of resolution. In
addition, they are notched down three times for very high non-
performance risk due to fully discretionary coupon omission.

Other legacy Tier 1 securities of BB plc are rated four notches
below the VR, comprising two notches for higher-than-average loss
severity, and two further notches for non-performance risk due to
partly discretionary coupon omission.

RATING SENSITIVITIES
VR
BARCLAYS BANK AND BARCLAYS PLC

The ring-fencing of domestic retail assets and liabilities out of
BB plc and into a new legal entity in April 2018 will reduce BB
plc's business diversification. However, Fitch ratings will
continue to factor in ordinary support between the two sister
companies and the holding company, to complement their standalone
earnings and capitalisation and offset any pressure that may
arise on their credit profile as a result of ring-fencing. Fitch
does not expects any change to BB plc's VR purely as a result of
ring fencing.

The VRs are primarily sensitive to the group's progress in
meeting performance and capital targets, as the ratings rely on
Fitch expectations that earnings and further release of RWAs will
be sufficient to absorb non-core and misconduct costs without
capital ratios being eroded.

Fitch expects the potential to reduce and optimise RWAs to have
reduced significantly since the group has achieved most of the
benefit of the sell-down of its stake in BAGL. Consequently Fitch
expects to see profits increasingly replacing RWAs as a source of
strengthening capital ratios. Failure to return to internal
capital generation could lead to a downgrade of the group's VR,
if Fitch believes that flexibility to manage regulatory
capitalisation is impaired.

The VRs are also sensitive to a material worsening of earnings
and asset quality if the economic environment deteriorates
substantially following the UK's decision to leave the EU. The
ratings would also come under pressure if the bank increases its
risk appetite materially, particularly in the corporate and
investment banking division.

Upside for the VR is limited in the medium term as the group
would need to demonstrate a sustainable improvement in earnings
through the cycle, resulting in a materially stronger capacity to
generate capital internally.

BARCLAYS BANK UK PLC

BBUK plc's VR could be downgraded if Fitch believes that the
bank's competitive position or financial profile weakens and
operational support from the group is not available to offset
this weakness, either because of competing needs in other parts
of the group or a shift in group strategy. A downgrade of BB
plc's VR could lead to a downgrade of BBUK plc if Fitch believes
that weaknesses of the group could negatively reflect on BBUK
plc's franchise or capitalisation.

An upgrade of BBUK plc's VR would require a sustainable
improvement in its earnings generation capacity beyond the non-
recurrence of conduct costs, which would reflect the bank's
competitive advantage in the domestic market. Because of the high
indebtedness of the UK private sector, Fitch currently caps the
VRs of domestic retail banks in the UK in the 'a' category.

IDRS, SENIOR DEBT and DCR
BARCLAYS BANK AND BARCLAYS PLC

B plc's IDR could be rated above the VR if the group materially
increases its qualifying junior debt buffer consisting of AT1 and
Tier 2 debt, which Fitch does not expects. Conversely it could be
rated lower if common equity double leverage increases above 120%
or if the role of the holding company changes, both of which
Fitch do not expects.

Fitch expects to upgrade BB plc's IDR one notch above the VR when
the debt received by the holding company becomes subordinated to
BB plc's other senior creditors, and provided that the quantum
together with its external qualifying junior debt remains
sufficient and sustainable.

The DCR is primarily sensitive to changes in BB plc's Long-Term
IDR.

BARCLAYS BANK UK PLC

BBUK plc's IDRs and DCR are primarily sensitive to the bank's VR.
In addition, they would be sensitive to the presence of a
sufficient quantum of internally down-streamed subordinated debt
being in place at the time of the transfer of liabilities to the
legal entity takes place and beyond.

SUPPORT RATING AND SUPPORT RATING FLOOR

An upgrade of BB plc's and B plc's SR and upward revision of the
SRFs would be contingent on a positive change in the sovereign's
propensity to support its banks, which Fitch does not expects.

A downgrade of BBUK plc's SR would require a downgrade of BB
plc's SR or evidence that the group's ability or propensity to
support BBUK plc has decreased.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

Subordinated debt and other hybrid capital ratings are primarily
sensitive to changes in the VRs of BB plc and B plc. The
securities' ratings are also sensitive to a change in their
notching, which could arise if Fitch changes its assessment of
the probability of their non-performance relative to the risk
captured in the respective issuers' VRs. This may reflect a
change in capital management in the group or an unexpected shift
in regulatory buffer requirements, for example.

The rating actions are:

Barclays plc
Long-Term IDR: affirmed at 'A'; Outlook Stable
Short-Term IDR: affirmed at 'F1'
Viability Rating: affirmed at 'a'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Senior debt including programme ratings: affirmed at 'A'/'F1'
Commercial paper: affirmed at 'F1'
Tier 2 instruments: affirmed at 'A-'
Basel III-compliant additional Tier 1 instruments: affirmed at
'BB+'

Barclays Bank Plc
Long-Term IDR 'A' placed on RWP
Short-Term IDR: affirmed at 'F1'
Viability Rating: affirmed at 'a'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'
Derivative Counterparty Rating 'A(dcr)' placed on RWP
Long-term senior unsecured debt, including programme 'A' placed
on RWP
Short-term senior unsecured debt, including programme ratings,
commercial paper and certificates of deposits: affirmed at 'F1'
Market-linked senior securities rating 'Aemr' placed on RWP
Lower Tier 2 debt: affirmed at 'A-'
Upper Tier 2 debt: affirmed at 'BBB'
Additional Tier 1 and preference shares with no constraints on
coupon omission: affirmed at 'BB+'
Other hybrid Tier 1 instruments: affirmed at 'BBB-'
Tier 2 contingent capital notes (US06740L8C27): affirmed at
'BBB-'

Barclays Bank UK plc
Long-Term IDR: assigned at 'A+(EXP)'; Outlook Stable
Short-Term IDR: assigned at 'F1(EXP)'
Viability Rating: assigned at 'a(EXP)'
Support Rating: assigned at '1(EXP)'
Derivative Counterparty Rating: assigned at 'A+ (dcr)( EXP)'


HBOS GROUP: Moody's Hikes Backed Preferred Stock Rating from Ba1
----------------------------------------------------------------
Moody's Investors Service upgraded the long-term deposit ratings
and long-term senior unsecured debt ratings of Lloyds Bank Plc
(Lloyds) by one notch to Aa3 from A1. The bank's standalone
baseline credit assessment (BCA) was upgraded to a3 from baa1.
The agency also upgraded the ratings on the senior unsecured debt
issued by the bank's holding company, Lloyds Banking Group plc
(LBG), to A3 from Baa1. The outlook on the bank's and holding
company's long-term ratings changed to stable from Rating Under
Review. The bank's short-term ratings were affirmed at Prime-1.
Lloyds' long-term Counterparty Risk Assessment (CRA) was
confirmed at Aa3(cr), the short-term CRA was affirmed at Prime-
1(cr).

The rating action concludes Moody's review for upgrade that began
on Aug. 2, 2017.

RATINGS RATIONALE

The upgrade of the BCA to a3 reflects Lloyds' improved asset
risk, stable capital levels and Moody's expectation that Lloyds'
profitability will continue to increase as the bank benefits from
lower legacy conduct charges and cost reductions, despite the
agency's expectations of a more challenging macroeconomic
environment ahead. Moody's believes that Lloyds has now booked
the bulk of charges related to its mis-selling of Payment
Protection Insurance (PPI), and expects that these costs will
decline relative to previous years given current levels of
provisions and the Financial Conduct Authority's imposition of an
August 2019 deadline for customers to claim compensation. Lloyds
has taken a cumulative GBP18 billion in PPI-related charges since
2011.

The upgrades of Lloyds' BCA and long-term deposit and senior
unsecured ratings also incorporate the likely impact of the
implementation of ring-fencing regulation in the UK. This will
result in Lloyds becoming the group's ring-fenced banking entity,
with the non-ring-fenced bank and insurance business established
as sister affiliates, beneath LBG. The effect of these changes on
Lloyds' strong credit fundamentals will be small since it will
still account for around 97% of the loans and advances of the
group, the main differences being a funding base drawn
proportionately more from domestic deposits and less from
offshore and wholesale funding, and a greater focus on retail and
commercial banking without the contribution of financial market
activities and insurance.

Moody's rating action on the bank's long-term deposit and senior
unsecured ratings also considers the benefit to its senior
creditors from the group's planned issuance of additional senior
holding company debt to meet its Minimum Requirements for
Eligible Liabilities and own Funds (MREL), which have been
published by the Bank of England. The rating agency expects
Lloyds to issue GBP4-5 billion of long-term senior unsecured
holding company debt annually for the next few years, which will
provide a larger buffer to absorb losses in resolution. Under
Moody's revised Advanced Loss Given Failure (LGF) analysis, the
rating agency expects this buffer to be of a sufficient magnitude
by 2019 to further reduce the likely loss-given-failure for
Lloyds' senior creditors, resulting in three notches of uplift
above the bank's adjusted BCA for long-term debt and deposits
(previously two notches). The revised LGF analysis was undertaken
following updates to Moody's Banks rating methodology, published
on 26 September 2017, which can be accessed via the following
link:
https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC
_1065675.

However, Moody's expectation for holding company debt issuance is
unlikely to be sufficient within the next few years to lead to a
higher rating on LBG's own senior unsecured debt.

Moody's continues to expect a moderate probability of government
support for Lloyds' deposits and senior unsecured creditors, but
following the recent downgrade of the government of the United
Kingdom to Aa2 stable, this no longer leads to further uplift to
the ratings (previously one notch). This offsets the benefit of
lower loss-given-failure and as such these ratings are upgraded
by one notch, in line with the upgrade in the BCA. For
subordinated and other junior securities, as well as LBG's senior
debt, Moody's continues to believe that the probability of
government support is low, resulting in no rating uplift.

The outlooks on Lloyds' and LBG's long-term ratings are stable,
reflecting Moody's view that following the upgrade, the ratings
now incorporate Moody's expectation of further improvements in
fundamentals, the consequences of ring-fencing, and additional
loss-absorbency.

WHAT COULD MOVE THE RATINGS UP/DOWN

Given the recent upgrade, a further upgrade of the BCA is
unlikely in the near-term. LBG's senior unsecured ratings could
be upgraded were Moody's to anticipate a material and sustainable
increase in loss absorbency for creditors beyond that which it
currently expects.

A downgrade is unlikely in the near-term. However, a downgrade of
Lloyds' BCA could be driven by (i) a more acute than expected
deterioration in the UK's operating environment, in particular,
in terms of economic growth, unemployment and the property
market; and/or (ii) a material decline in the bank's capital
metrics. A downward movement in Lloyds' BCA would likely result
in downgrades to all long-term ratings.

Lloyds's long-term senior unsecured debt and deposit ratings
could also be downgraded in response to a failure to make the
expected increase in holding company debt, which would increase
loss-given-failure for these instruments.

LIST OF AFFECTED RATINGS

Issuer: Lloyds Banking Group plc

Upgrades:

-- Backed Junior Subordinated Regular Bond/Debenture, upgraded
    to Baa2(hyb) from Baa3(hyb)

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)A3
    from (P)Baa1

-- Subordinate Medium-Term Note Program, upgraded to (P)Baa1
    from (P)Baa2

-- Senior Unsecured Shelf, upgraded to (P)A3 from (P)Baa1

-- Preference Shelf, upgraded to (P)Baa3 from (P)Ba1

-- Subordinate Shelf, upgraded to (P)Baa1 from (P)Baa2

-- Preferred Stock Non-cumulative, upgraded to Baa3(hyb) from
    Ba1(hyb)

-- Subordinate Regular Bond/Debenture, upgraded to Baa1 from
    Baa2

-- Senior Unsecured Regular Bond/Debenture, upgraded to A3
    Stable from Baa1 Rating Under Review

Confirmations:

-- Other Short Term, confirmed at (P)P-2

Outlook Action:

-- Outlook changed to Stable from Rating Under Review

Issuer: Lloyds Bank Plc

Upgrades:

-- Adjusted Baseline Credit Assessment, upgraded to a3 from baa1

-- Baseline Credit Assessment, upgraded to a3 from baa1

-- Junior Subordinated Regular Bond/Debenture, upgraded to
    Baa2(hyb) from Baa3(hyb)

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)Aa3
    from (P)A1

-- Backed Senior Unsecured Medium-Term Note Program, upgraded to
    (P)Aa3 from (P)A1

-- Backed Senior Unsecured Shelf, upgraded to (P)Aa3 from (P)A1

-- Subordinate Medium-Term Note Program, upgraded to (P)Baa1
    from (P)Baa2

-- Backed Subordinate Medium-Term Note Program, upgraded to
    (P)Baa1 from (P)Baa2

-- Backed Subordinate Shelf, upgraded to (P)Baa1 from (P)Baa2

-- Preferred Stock, upgraded to Baa3(hyb) from Ba1(hyb)

-- Subordinate Regular Bond/Debenture, upgraded to Baa1 from
    Baa2

-- Backed Subordinate Regular Bond/Debenture, upgraded to Baa1
    from Baa2

-- Senior Unsecured Regular Bond/Debenture, upgraded to Aa3
    Stable from A1 Rating Under Review

-- Backed Senior Unsecured Regular Bond/Debenture, upgraded to
    Aa3 Stable from A1 Rating Under Review

-- Long-term Bank Deposits, upgraded to Aa3 Stable from A1
    Rating Under Review

Confirmation:

-- Long-term Counterparty Risk Assessment, confirmed at Aa3(cr)

Affirmations:

-- Commercial Paper, affirmed P-1

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Short-term Bank Deposits, affirmed P-1

-- Multiple Seniority Medium-Term Note Program (Local Currency),
    Affirmed (P)P-1

-- Other Short Term, affirmed (P)P-1

Outlook Action:

-- Outlook changed to Stable from Rating Under Review

Issuer: HBOS plc

Upgrades:

-- Long-term Issuer Rating, upgraded to Aa3 Stable from A1
    Rating Under Review

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)Aa3
    from (P)A1

-- Subordinate Regular Bond/Debenture, upgraded to Baa1 from
    Baa2

-- Subordinate Medium-Term Note Program, upgraded to (P)Baa1
    from (P)Baa2

-- Junior Subordinated Regular Bond/Debenture, upgraded to
    Baa2(hyb) from Baa3(hyb)

-- Junior Subordinate Medium-Term Note Program, upgraded to
    (P)Baa2 from (P)Baa3

Confirmation:

-- Long-term Counterparty Risk Assessment, confirmed at Aa3(cr)

Affirmations:

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Short-term Issuer Rating, affirmed P-1

-- Other Short Term, affirmed (P)P-1

Outlook Action:

-- Outlook changed to Stable from Rating Under Review

Issuer: Bank of Scotland plc

Upgrades:

-- Adjusted Baseline Credit Assessment, upgraded to a3 from baa1

-- Baseline Credit Assessment, upgraded to a3 from baa1

-- Long-term Issuer Rating, upgraded to Aa3 Stable from A1
    Rating Under Review

-- Junior Subordinated Regular Bond/Debenture, upgraded to
    Baa2(hyb) from Baa3(hyb)

-- Backed Senior Unsecured Medium-Term Note Program, upgraded to
    (P)Aa3 from (P)A1

-- Backed Junior Subordinate Medium-Term Note Program, upgraded
    to (P)Baa2 from (P)Baa3

-- Backed Subordinate Medium-Term Note Program, upgraded to
    (P)Baa1 from (P)Baa2

-- Preferred Stock Non-cumulative, upgraded to Baa3(hyb) from
    Ba1(hyb)

-- Subordinate Regular Bond/Debenture, upgraded to Baa1 from
    Baa2

-- Backed Senior Unsecured Regular Bond/Debenture, upgraded to
    Aa3 Stable from A1 Rating Under Review

-- Long-term Bank Deposits, upgraded to Aa3 Stable from A1
    Rating Under Review

Confirmation:

-- Long-term Counterparty Risk Assessment, confirmed at Aa3(cr)

Affirmations:

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Short-term Bank Deposits, affirmed P-1

Outlook Action:

-- Outlook changed to Stable from Rating Under Review

Issuer: Bank of Scotland Capital Funding L.P.

Upgrade:

-- Backed Preferred Stock Non-cumulative, upgraded to Baa3(hyb)
    from Ba1(hyb)

No Outlook assigned

Issuer: HBOS Treasury Services Plc

Upgrades:

-- Senior Unsecured Regular Bond/Debenture, upgraded to Aa3
    Stable from A1 Rating under Review

-- Backed Senior Unsecured Regular Bond/Debenture, upgraded to
    Aa3 Stable from A1 Rating under Review

Outlook Action:

-- Outlook changed to Stable from Rating Under Review

Issuer: HBOS Capital Funding No. 1 L.P.

Upgrade:

-- Backed Preferred Stock Non-cumulative, upgraded to Baa3(hyb)
    from Ba1(hyb)

No Outlook assigned

Issuer: HBOS Capital Funding No. 2 L.P.

Upgrade:

-- Backed Preferred Stock Non-cumulative, upgraded to Baa3(hyb)
    from Ba1(hyb)

No Outlook assigned

Issuer: HBOS Capital Funding No. 4 L.P.

Upgrade:

-- Backed Preferred Stock Non-cumulative, upgraded to Baa3(hyb)
    from Ba1(hyb)

No Outlook assigned

Issuer: Halifax plc

Upgrades:

-- Backed Junior Subordinated Regular Bond/Debenture, upgraded
    to Baa3(hyb) from Ba1(hyb)

-- Backed Subordinate Regular Bond/Debenture, upgraded to Baa1
    from Baa2

No Outlook assigned

Issuer: HBOS Group Sterling Finance L.P.

Upgrade:

-- Backed Preferred Stock Non-cumulative, upgraded to Baa3(hyb)
    from Ba1(hyb)

No Outlook assigned

Issuer: Leeds Permanent Building Society

Upgrades:

-- Backed Junior Subordinated Regular Bond/Debenture, upgraded
    to Baa3(hyb) from Ba1(hyb)

-- Backed Subordinate Regular Bond/Debenture, upgraded to Baa1
    from Baa2

No Outlook assigned

Issuer: Cheltenham & Gloucester plc

Upgrade:

-- Junior Subordinated Regular Bond/Debenture, upgraded to
    Baa2(hyb) from Baa3(hyb)

No Outlook assigned

Issuer: Lloyds Bank plc (Australia)

Upgrades:

-- Senior Unsecured Medium-Term Note Program, upgraded to (P)Aa3
    from (P)A1

-- Subordinate Medium-Term Note Program, upgraded to (P)Baa1
from
    (P)Baa2

Affirmation:

-- Other Short Term, affirmed (P)P-1

Outlook Action:

-- Outlook changed to Stable from Rating Under Review

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in September 2017.


LASER ABS 2017: Fitch Affirms BB+ Rating on Class D Notes
---------------------------------------------------------
Fitch Ratings has affirmed LaSer ABS 2017 plc's notes:

Class A notes: affirmed at 'AAAsf'; Outlook Stable
Class B notes: affirmed at 'Asf'; Outlook Stable
Class C notes: affirmed at 'BBB+sf'; Outlook Stable
Class D notes: affirmed at 'BB+'; Outlook Stable

LaSer ABS 2017 is a securitisation of unsecured consumer loans
originated by Creation Consumer Finance Limited (CCFL) to
borrowers in England and Wales. CCFL is a wholly-owned subsidiary
of Creation Financial Services Limited, in turn 100% owned by BNP
Paribas S.A. (A+/Stable/F1). The transaction features an initial
revolving period of one year, which will end in April 2018. The
securitised pool comprises personal loans and point of sales,
which can be further split into interest-bearing, interest-free
and deferred interest-free. For the purposes of the rating
analysis, Fitch considers deferred interest-free point of sales
together with interest-free point of sales.

The review has been prompted by a re-pricing of the class B to E
notes, and by the receipt of updated historical prepayment data.

KEY RATING DRIVERS

Revised Prepayment Assumptions
Fitch has received updated information regarding historical
prepayment data, substantially different from the data provided
at closing, which was incomplete. Fitch understand from the
originator that the data provided for the initial rating analysis
did not include prepaid amounts where the borrower did not inform
of the intention to prepay beforehand. Fitch has reviewed and
revised Fitch base case prepayment assumption for each sub-pool
incorporated in the cash-flow model and stressed according to
Fitch's criteria:

- Interest-free point-of-sale: 5% from 2%
- Interest-bearing point-of-sale: 9% from 3%
- Personal loans: 13.5% from 5.0%

Updated Coupons
The class B to E notes have been re-priced, in line with
transaction documentation, at lower levels compared with those
set at closing.
- Class B: spread of 150bps from 175bps
- Class C: spread of 225bps from 265bps
- Class D: spread of 325bps from 420bps
- Class E (unrated): fixed coupon of 4.0% from 9.5%.

The margin and interest rate reductions increase available excess
spread in the transaction but has a marginal impact on the cash
flow model results.

Revolving Period and Performance
The transaction is still in its revolving period, which will end
in April 2018. The performance has been good and in line with
Fitch's expectations.

RATING SENSITIVITIES

The transaction has been tested to determine the rating impact of
a combined increase in defaults and a decrease in recoveries by
25% and 50% each. The expected impacts are:

Increase in defaults and decrease in recoveries by 25%:
Class A: 'AAAsf'; expected impact: 'AAsf'
Class B: 'Asf'; expected impact: 'BBB+sf'
Class C: 'BBB+sf'; expected impact: 'BB+sf'
Class D: 'BB+sf'; expected impact: 'B+sf'

Increase in defaults and decrease in recoveries by 50%:
Class A: 'AAAsf'; expected impact: 'Asf'
Class B: 'Asf'; expected impact: 'BBB-sf'
Class C: 'BBB+sf'; expected impact: 'BB-sf'
Class D: 'BB+sf'; expected impact: 'NR'


MONARCH AIRLINES: Private Equity Owner Comments on Collapse
-----------------------------------------------------------
James Quinn at The Daily Telegraph reports that the private
equity owner of collapsed Monarch Airlines said it was grounded
by a "bloody hurricane" of problems as it counted the GBP250
million cost of its collapse.

Describing the European short-haul market as a "bloodbath,"
Marc Meyohas, founder of Greybull Capital, blamed a perfect storm
of sterling's weakness, terrorism in the Middle East and Brexit
for the airline's demise, the biggest in British aviation
history, The Daily Telegraph relates.

In his first comments since the airline went into administration
in the early hours of on Oct. 2, the Greybull boss admitted to
The Daily Telegraph that its relatively small size meant it was
unable to stem losses when hit by "pretty large headwinds".

Administrator Blair Nimmo of KPMG is leading the winding up of
the airline, but admitted that there was little hope for its
2,100 staff, 1,858 of whom were immediately made redundant, The
Daily Telegraph discloses.

He said that the airline "ran out of options", as he acknowledged
that with its 35 planes -- all of which are leased -- grounded,
the only option is to "realise the assets in due course", The
Daily Telegraph notes.

In an email to all staff at 3:26 a.m. on on Oct. 2, Monarch chief
executive Andrew Swaffield explained why the airline was going
into administration, pointing to GBP60 million of losses this
year, and an expected GBP100 million-plus loss next year, The
Daily Telegraph relays.

Greybull, which apologized for Monarch's collapse, as cited by
The Daily Telegraph, said that its failure was the result of the
closure of popular routes to Egypt and Turkey because of
terrorist attacks, and an increase in costs due to sterling's
weakness.


NORTH POINT: Completes Company Voluntary Arrangement
----------------------------------------------------
North West Place reports that North Point Global Group, the
Liverpool developer that this summer withdrew from several high
profile development sites in the city, has completed a Company
Voluntary Arrangement through insolvency practitioner Chamberlain
& Co.

The CVA has been completed by NPG at group level, while various
businesses set up to deal with individual development sites are
still listed as active, North West Place relates.  The
arrangement was supported by 100% of the business's creditors,
North West Place discloses.

According to North West Place, documents filed with Companies
House by Chamberlain & Co show that almost GBP4.2 million was
owed by the business to the companies listed in the report.

The bulk of this was owed to subsidiaries linked to the various
NPG development projects, North West Place notes.

NPG, as cited by North West Place, said that the CVA process does
not have any effect on any of the development schemes owned by
North Point Global Group, which are in the process of being sold.

Monarch Airlines, also known as and trading as Monarch, is a
British airline based at Luton Airport, operating scheduled
flights to destinations in the Mediterranean, Canary Islands,
Cyprus, Egypt, Greece and Turkey.


ROYAL BANK: Moody's Affirms (P)Ba3 Preference Shelf Rating
----------------------------------------------------------
Moody's Investors Service changed the outlooks on the long-term
deposits and senior unsecured debt of The Royal Bank of Scotland
plc (RBS plc) and The Royal Bank of Scotland N.V. (RBS NV) to
negative from stable. Moody's also changed the outlook on the
long-term deposit rating and issuer rating of RBS's subsidiary
National Westminster Bank PLC (NatWest Bank) to positive from
stable. The agency maintained the stable outlook on the long-term
senior unsecured debt of holding company, The Royal Bank of
Scotland Group plc (RBSG).

Concurrently, the rating agency affirmed all ratings of RBSG and
those of RBS plc, NatWest Bank and RBS NV.

"The change in the outlooks reflects Moody's view on the likely
direction of these subsidiaries' ratings, following the
implementation of forthcoming ring-fencing regulations", said
Alessandro Roccati, Senior Vice President at Moody's. The outlook
change is not driven by fundamental credit pressures deriving
from the exit of the UK from the European Union ("Brexit"), as
Moody's considers that the group benefits from sustainable
earnings from core retail and corporate businesses, which
mitigate downward credit pressures arising from Brexit and
provide substantial shock absorbers relative to the remaining
capital markets business.

"Ring-fencing" will come into effect on 1 January 2019 and
Moody's expects RBS will complete its material restructuring by
the end of 2018.

RATINGS RATIONALE

RBS plc will transfer most of its Personal & Business Banking and
Commercial & Private Banking operations to a ring-fenced banking
subgroup (under an intermediate holding company, NatWest Holdings
Ltd, expected to become a direct subsidiary of RBSG in mid-2018),
which will account for around 80% of group risk-weighted assets.
The ring-fenced bank sub-group will include NatWest Bank, Ulster
Bank Ireland DAC (LT deposits Baa2 stable), Ulster Bank Limited (
LT deposits A2 stable) and Adam & Company PLC and Coutts &
Company.

The group's capital market activities will remain with RBS plc.

At the same time as the legal transfer of assets and liabilities,
RBS plc will be renamed NatWest Markets Plc (NatWest Markets),
and Adam & Company PLC will be renamed The Royal Bank of Scotland
plc (RBS plc).

RBS International (RBSI), a subsidiary of RBSG, will retain
mostly retail and commercial activities in the UK's Crown
Dependencies. RBS NV, currently a subsidiary of RBSG, will likely
become the entity conducting wholesale activities in the European
Union outside the UK.

Moody's currently aligns the ratings of NatWest Bank and RBS NV
with those of the current RBS plc (to be renamed NatWest
Markets). Under ring-fencing, NatWest Markets will have a
significantly weaker credit profile as it will become the entity
of the group retaining capital markets and wholesale activities.
As such, it will be largely market funded, have a sizeable
trading and repo book, and will provide broker-dealer
capabilities. RBS NV will also show a weaker credit profile,
because of its largely wholesale activities. Conversely, NatWest
Bank will have a stronger credit profile as it will retain mostly
retail and SME activities, and have a more deposit-based funding
profile.

During the outlook period Moody's will assess the prospective
credit profiles of the new and modified group entities and the
expected loss for each instrument class at each entity under its
advanced Loss Given Failure analysis, once there is greater
clarity on the financials and liability structures of these
entities.

WHAT COULD MOVE THE RATINGS UP/DOWN

The implementation of ring-fencing regulations will likely lead
to downgrades in the baseline credit assessments (BCAs), both
long-term and short-term deposit ratings, long-term debt ratings,
and subordinated debt ratings of RBS plc and RBS NV, and to
upgrades in the BCA and ratings of NatWest Bank.

The ratings of RBSG and NatWest Bank could be upgraded if the
group were to return to sustainable profitability in line with
that of peers, generate capital organically and successfully
complete its multi-year restructuring exercise. Other factors
being equal, the ratings could also be upgraded if the volume of
loss-absorbing capital substantially increases during the outlook
period, creating greater protection for its creditors.

The ratings of RBSG, RBS plc (to be renamed NatWest Markets) and
NatWest Bank could be downgraded if the group's restructuring and
de-risking strategy fails to deliver improvements in its credit
fundamentals, weakening its capital, profitability and
operational efficiency levels and raising its asset risk. A
significant deterioration in the operating environment beyond
Moody's base case expectations, and/or regulatory and litigation
charges that are substantially higher than those Moody's
currently expects, may also result in a downgrade of the BCAs.
The ratings could also be downgraded as a result of a sizeable
reduction in the outstanding liabilities that could be bailed in,
resulting in a higher loss-given-failure for senior creditors and
hence a lower rating.

LIST OF AFFECTED RATINGS

Issuer: The Royal Bank of Scotland Group plc

Affirmations:

-- Senior Unsecured Regular Bond/Debenture, affirmed Baa3 Stable

-- Senior Unsecured Medium-Term Note Program, affirmed (P)Baa3

-- Senior Unsecured Shelf, affirmed (P)Baa3

-- Subordinate Regular Bond/Debenture, affirmed Ba1

-- Subordinate Regular Bond/Debenture, affirmed Ba2

-- Subordinate Medium-Term Note Program, affirmed (P)Ba1

-- Subordinate Shelf, affirmed (P)Ba1

-- Subordinate Shelf, affirmed (P)Ba2

-- Junior Subordinated Regular Bond/Debenture, affirmed Ba2(hyb)

-- Junior Subordinate Medium-Term Note Program, affirmed (P)Ba2

-- Junior Subordinate Shelf, affirmed (P)Ba2

-- Preferred Stock, affirmed Ba2(hyb)

-- Preferred Stock Non-cumulative, affirmed Ba3(hyb)

-- Preference Shelf, affirmed (P)Ba2

-- Preference Shelf, affirmed (P)Ba3

-- Other Short Term, affirmed (P)P-3

-- Commercial Paper, affirmed P-3

Outlook Action:

-- Outlook remains Stable

Issuer: The Royal Bank of Scotland plc

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed A2(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Long-term Bank Deposits, affirmed A2, outlook changed to
    Negative from Stable

-- Short-term Bank Deposits, affirmed P-1

-- Senior Unsecured Regular Bond/Debenture, affirmed A3, outlook
    changed to Negative from Stable

-- Backed Senior Unsecured Regular Bond/Debenture, affirmed A3,
    outlook changed to Negative from Stable

-- Senior Unsecured Medium-Term Note Program, affirmed (P)A3

-- Backed Senior Unsecured Medium-Term Note Program, affirmed
   (P)A3

-- Backed Senior Unsecured Shelf, affirmed (P)A3

-- Subordinate Regular Bond/Debenture, affirmed Ba2

-- Subordinate Regular Bond/Debenture, affirmed Ba1

-- Subordinate Medium-Term Note Program, affirmed (P)Ba1

-- Backed Subordinate Medium-Term Note Program, affirmed (P)Ba1

-- Backed Subordinate Shelf, affirmed (P)Ba1

-- Junior Subordinated Regular Bond/Debenture, affirmed Ba2(hyb)

-- Backed Junior Subordinated Regular Bond/Debenture, affirmed
    Ba2(hyb)

-- Junior Subordinate Medium-Term Note Program, affirmed (P)Ba2

-- Backed Junior Subordinate Medium-Term Note Program, affirmed
    (P)Ba2

-- Commercial Paper, affirmed P-2

-- Backed Commercial Paper, affirmed P-2

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

-- Backed Other Short Term, affirmed (P)P-2

-- Short-term Deposit Note/CD Program, affirmed P-1

-- Adjusted Baseline Credit Assessment, affirmed baa3

-- Baseline Credit Assessment, affirmed baa3

Outlook Action:

-- Outlook changed to Negative from Stable

Issuer: RBS Capital Trust B

Affirmation:

-- Backed Preferred Stock Non-cumulative, affirmed Ba3(hyb)

No Outlook assigned

Issuer: RBS Capital Trust II

Affirmation:

-- Backed Preferred Stock Non-cumulative, affirmed Ba3(hyb)

No Outlook assigned

Issuer: RBS Holdings N.V.

Affirmations:

-- Senior Unsecured Shelf, affirmed (P)Baa3

-- Subordinate Shelf, affirmed (P)Ba1

No Outlook assigned

Issuer: Royal Bank of Scotland N.V.

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed A2(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Long-term Bank Deposits, affirmed A2, outlook changed to
    Negative from Stable

-- Short-Term Bank Deposits, affirmed P-1

-- Long-term Issuer Rating, affirmed A3, outlook changed to
    Negative from Stable

-- Senior Unsecured Regular Bond/Debenture, affirmed A3, outlook
    changed to Negative from Stable

-- Backed Senior Unsecured Regular Bond/Debenture, affirmed A3,
    outlook changed to Negative from Stable

-- Senior Unsecured Medium-Term Note Program, affirmed (P)A3

-- Backed Senior Unsecured Medium-Term Note Program, affirmed
    (P)A3

-- Subordinate Medium-Term Note Program, affirmed (P)Ba1

-- Subordinate Regular Bond/Debenture, affirmed Ba1

-- Junior Subordinate Medium-Term Note Program, affirmed (P)Ba2

-- Short-term Deposit Note/CD Program, affirmed P-1

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

-- Commercial Paper, affirmed P-2

-- Adjusted Baseline Credit Assessment, affirmed baa3

-- Baseline Credit Assessment, affirmed baa3

Outlook Action:

-- Outlook changed to Negative from Stable

Issuer: Royal Bank of Scotland N.V., London Branch

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed A2(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

No Outlook assigned

Issuer: Royal Bank of Scotland plc, Tokyo Branch

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed A2(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Commercial Paper, affirmed P-2

No Outlook assigned

Issuer: National Westminster Bank PLC

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed A2(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

-- Long-term Bank Deposit, affirmed A2, outlook changed to
    Positive from Stable

-- Short-term Bank Deposits, affirmed P-1

-- Long-term Issuer Rating, affirmed A3, outlook changed to
    Positive from Stable

-- Senior Unsecured Shelf, affirmed (P)A3

-- Subordinate Regular Bond/Debenture, affirmed Ba1

-- Subordinate Shelf, affirmed (P)Ba1

-- Junior Subordinated Regular Bond/Debenture, affirmed Ba2(hyb)

-- Preferred Stock Non-cumulative, affirmed Ba3(hyb)

-- Preference Shelf, affirmed (P)Ba2

-- Adjusted Baseline Credit Assessment, affirmed baa3

-- Baseline Credit Assessment, affirmed baa3

Outlook Action:

-- Outlook changed to Positive from Stable

Issuer: Royal Bank of Scotland plc, Australia Branch

Affirmations:

-- Long-term Counterparty Risk Assessment, affirmed A2(cr)

-- Short-term Counterparty Risk Assessment, affirmed P-1(cr)

No Outlook assigned

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in September 2017.


TATA STEEL UK: S&P Affirms 'B+' CCR on Merger With Thyssenkrupp
---------------------------------------------------------------
S&P Global Ratings said that it affirmed its long-term corporate
credit ratings at 'BB-' on Tata Steel Ltd. (TSL) and 'B+' at Tata
Steel UK Holdings Ltd. (TSUKH). S&P said, "At the same time, we
affirmed our short-term corporate ratings on TSUKH at 'B'. We
also affirmed our 'BB-' issue ratings on notes guaranteed by TSL.
The long-term outlook on both companies is stable."

S&P said, "We have affirmed our ratings on TSL because any
potential leverage benefits from the announced 50/50 joint
venture (JV) of its European operations with thyssenkrupp AG are
least two years away and depend on approvals from shareholders
and multiple regulatory agencies. Nevertheless, plans to inject
all of the European assets into the JV indicate a limited
potential for support in future. We have reassessed the group
status for TSUKH to strategically important from highly
strategic."

Under the proposed transaction, TSL will transfer EUR2.5 billion
in debt held under TSUKH to the JV. As such, TSL will no longer
consolidate this debt in its financial statements; it will also
deconsolidate interest expenses or capital expenditures under
TSUKH. S&P projects this will improve TSL's ratio of funds from
operations (FFO) to debt from around 15% to about 17% in fiscal
year ending in March 31, 2020, thereby crossing our upgrade
trigger for TSL. However, such an improvement is conditional on
the Indian operations' sustaining current estimates of
profitability and moderate capital spending.

TSL will also transfer all of TSUKH's assets into the JV. As
such, its operating scale will be smaller post-merger, and more
focused on its Indian assets. S&P said, "We believe TSL will
likely deploy its managerial and financial resources toward
building additional scale -- either organically or through
acquisition -- in its India steel-making business. We expect TSL
to produce 12 million tons of steel per annum at an average per
ton EBITDA of Indian rupee (INR) 11,500 over the next two to
three years and that capital expenditure will stay around INR 60
billion annually in this period."

The JV will have TSL and thyssenkrupp, two strong parents, both
lending their names to it. Based on a memorandum of understanding
signed earlier this month, the post-merger company, to be named
Thyssenkrupp Tata Steel BV, will have a flat-rolled steel
capacity of 20-21 million tons per annum. The JV will likely have
an annual EBITDA of EUR1.5 billion in fiscal 2020; this is based
on the last 12 months' operational performance and before
including any synergy benefits. S&P estimates it will have gross
long-term debt and pension liabilities of about EUR6.5 billion
(including thyssenkrupp's pension liabilities, which will be
injected into the JV).

S&P said, "We have affirmed our rating on TSL's fully owned
subsidiary TSUKH because we expect TSL will continue to support
TSUKH at least until the formation of the merger with
thyssenkrupp. In our view, TSL's plans to shift TSUKH's assets
and part of its debt to the JV indicate a shrinking potential of
extraordinary support from TSL towards the European assets and a
reduced long-term strategic importance. In light of these
developments, we no longer consider TSUKH to be highly strategic
to TSL. However, TSUKH's large size, contribution to TSL, name-
sharing, and record of financial and managerial support by TSL
still suggests, in our opinion, a degree of strategic importance
and likely forthcoming support if needed until the assets are
formally injected into the JV. Once we have more clarity on debt
composition at TSUKH after a definitive agreement is signed
between the partners, we will reassess TSUKH's standing in the
group.

"We expect the JV partners to work out a binding agreement by
April 2018. This document will likely provide us more clarity on
the management structure and key decision-making responsibilities
after the merger. Moreover, if any of TSUKH's debt is refinanced
prior to its shifting to the JV, we will have clear understanding
of debt at TSL (outside of JV) and the standing of TSUKH in the
Tata Steel group structure in such scenario.

"We will reassess the impact of the deal on TSL as more details
become available via a binding agreement, timelines for
approvals, and any information on potential debt reconfigurations
at TSUKH.

The stable outlook on Tata Steel reflects our expectation that
the company will maintain its healthy profitability in its Indian
operations and fair operating performance in Europe. This is
supported by strong steel prices in India on the back of Indian
government's protection measures, and an improved demand-supply
in global steel markets. We also believe that Tata Steel will
manage its capital expenditure and working capital needs such
that its free cash flow turns positive starting in fiscal 2018.
Although unlikely over next 12 months, we could lower our rating
on Tata Steel if the operating performance is weaker than we
anticipated, such that its EBITDA interest coverage stays below
2.0x for a prolonged period. This weakness in operating and
financial metrics would likely result in EBITDA per ton of steel
stagnating below INR8,000 at the India operations.

"We could upgrade the company if the ratio of FFO to debt
sustainably crosses 15%. This could happen if EBITDA per ton at
the India operations reaches INR15,000 sustainably and the Europe
operations generate a healthy EBITDA. Prudently controlled
capital expenditure leading to positive free operating cash flow
generation would also support an upgrade. The formation and ramp
up of the merger with thyssenkrupp could improve ratios to a
level commensurate with upgrade trigger."


UNITED BISCUITS: S&P Affirms Then Withdraws 'B+' CCR
----------------------------------------------------
S&P Global Ratings said it has affirmed its 'B+' long-term
corporate credit rating on U.K.-based biscuits manufacturer UMV
Global Foods Holding Co. Ltd. (United Biscuits). S&P also
affirmed the 'B+' issue rating on the senior secured debt.

S&P said, "At the company's request, we subsequently withdrew our
'B+' corporate credit and issue ratings on United Biscuits. We
also withdrew the recovery rating of '3' on the senior debt,
which indicated our expectation of meaningful (60%) recovery for
debtholders in the case of a payment default."

The outlook was negative at the time of the withdrawal.

On Sept. 4, 2017, United Biscuits repaid all amounts under the
senior facilities agreement dated November 2014 through a full
debt refinancing.

At the time of the withdrawal, S&P Global Ratings believed that
United Biscuits' debt leverage and liquidity position were
supported by cash inflow from asset disposals. S&P Global Ratings
projected that credit metrics should stabilize in the next 12
months to adjusted debt to EBITDA of about 5x (versus 6.4x in
2016). S&P had also anticipated that the company would generate
GBP40 million in free operating cash flows in 2017.

S&P said, "In our view, United Biscuits' business remains subject
to operational headwinds in the U.K., its main market (about 70%-
80% of group EBITDA), and in Northern Europe (France and The
Netherlands). For the U.K., we see limited topline growth over
the next two years due to growing competition and price increases
to restore gross margins affecting volume growth. Profitability
should remain constrained due to higher raw materials costs.
Overall, we continue to see revenue concentration in the U.K. to
one product category and one brand (McVitie's). That said, the
biscuits category is relatively noncyclical and United Biscuits
has a leading market share in the U.K., its products are well
distributed in the country, and its brands such as McVitie's
carry strong consumer awareness."


XTREME BUSINESS: Enters Administration, 50 Jobs Affected
--------------------------------------------------------
Perry Gourley at The Scotsman reports that all 50 staff at Xtreme
Business Solution, a cabling and networked systems firm, have
been made redundant after cash flow issues forced it into
administration.

According to The Scotsman, administrators from FRP Advisory have
been appointed after the firm suffered from rising costs and
falling margins.  They are now marketing the company's assets for
sale, including vehicles, access platforms and work in progress,
The Scotsman discloses.

Xtreme Business Solutions, which had offices in Aberdeen and
Dalgety Bay, worked with clients including the Trump
International Golf Links, Network Rail, University of St Andrews
and William Grant & Sons.



                            *********

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

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

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


                            *********


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

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

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

This material is copyrighted and any commercial use, resale or
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
856-381-8268.


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