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        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, December 13, 2017, Vol. 18, No. 247


                            Headlines


C Y P R U S

CAMPOSOL HOLDING: Fitch Raises Issuer Default Rating to 'B'


C Z E C H   R E P U B L I C

KRALOVOPOLSKA RIA: To Undergo Reorganization, Averts Bankruptcy


F R A N C E

CGG SA: Paris Commercial Court Approves Safeguard Plan


G E R M A N Y

TRIONISTA TOPCO: Moody's Withdraws B1 Corporate Family Rating


I R E L A N D

PROVIDE BLUE 2005-2: S&P Affirms CCC+ Rating on Class E Notes


I T A L Y

ALBA 8: Moody's Hikes Rating on Class C Notes From Ba1
PATRIMONIO UNO: S&P Cuts Rating on Class F Notes to BB(sf)


L U X E M B O U R G

M7 GROUP: S&P Assigns 'B+' Corp Credit Rating, Outlook Stable


N E T H E R L A N D S

E-MAC PROGRAM II: Moody's Lowers Rating on Class D Notes to B3


N O R W A Y

NORWEGIAN AIR 2016-1: Fitch Affirms BB- Rating on Class B Certs
SEADRILL LTD: Unsecured Bondholders Submits Rival Debt Plan


P O R T U G A L

BANCO COMERCIAL: Fitch Rates EUR300MM Subordinated Notes B+


R U S S I A

ALTAI REGION: Fitch Affirms B+ Long-Term IDR, Outlook Stable
CHUVASH REPUBLIC: Fitch Affirms BB+ Long-Term IDR, Outlook Stable
KAZAN CITY: Fitch Affirms BB- Long-Term IDR, Outlook Stable
KRASNODAR REGION: Fitch Affirms BB LongTerm IDRs, Outlook Stable
ROSEVROBANK: S&P Affirms 'BB-/B' ICRs, Outlook Stable

YAMAL-NENETS REGION: S&P Affirms 'BB+' ICR, Outlook Positive


S P A I N

BANCO POPULAR ESPANOL: Creditors Opposes Koenig Reappointment
CAIXABANK RMBS 3: Moody's Assigns (P)Caa3 Rating to Cl. B Notes


T U R K E Y

ISTANBUL: Fitch Affirms 'BB+/B' Issuer Default Ratings
MAKRO MARKET: Enters Into Agreement with Nine Creditors


U K R A I N E

* UKRAINE: Several Small Banks at Risk of Bankruptcy


U N I T E D   K I N G D O M

ALPHA GROUP: Fitch Assigns 'B(EXP)' LT Issuer Default Rating
JAGUAR LAND: Moody's Revises Outlook to Stable, Affirms Ba1 CFR
SPIRIT ISSUER: S&P Affirms BB+(sf) Ratings on Six Note Classes


                            *********



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C Y P R U S
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CAMPOSOL HOLDING: Fitch Raises Issuer Default Rating to 'B'
-----------------------------------------------------------
Fitch Ratings has upgraded to 'B' from 'B-' the Foreign and Local
Currency Issuer Default Ratings (IDRs) for Camposol Holding Plc.
(Camposol) and its wholly-owned subsidiary Camposol S.A. Also,
Fitch has upgraded Camposol S.A.'s senior secured notes to 'B/RR4
from 'B-/RR4'. Camposol's Recovery Rating is capped at 'RR4' due
to the location of the group's operations; Fitch currently limits
recovery ratings for corporates located in Peru to 'RR4'. This
recovery rating reflects average recovery prospects.

The rating upgrade reflects Camposol's vastly improved credit
metrics, stronger liquidity position, and longer debt maturity
profile after paying the final bond maturity due in early 2017.
The ratings upgrade also reflects Camposol's increased
operational scale, more cash generative business profile due to a
better mix of products and the expansion of the avocado,
blueberry and shrimp businesses. The Positive Outlook reflects
the company's plan to do an IPO and possibly further improve its
capital structure in the near term.

KEY RATING DRIVERS

Low Leverage: The credit metrics are strong for the 'B' rating
category. Fitch expects gross leverage to decline below 2.0x by
the end of 2017 from 3.4x in fiscal year end 2016 (FYE16).
Camposol's net debt/latest 12 month (LTM) EBITDA decreased to
1.1x as of September 2017 down from 2.3x in FYE16 due to much
higher EBITDA; EBITDA growth was primarily attributable to higher
volumes and prices of avocados and shrimp. As of September 2017,
Camposol's total debt was USD165 million mainly consisting of
USD147.5 million 10.5% notes due in 2021.This debt is secured by
land, biological assets, machinery and equipment and all
licenses, including water licenses and is callable July 15, 2018.

Exposure to Climatic Risks and International Prices: Camposol is
exposed to price fluctuation and external factors such as
climatic events like 'El Nino' or 'La Nina' phenomenons, which
could impact yields and cause logistical issues, and/or the
outbreak or proliferation of diseases. All of which could
negatively impact production volumes and cash flow generation. In
the last five years, Camposol has faced several 'El Nino'
phenomena that have negatively impacted shrimp and avocado
yields. In early 2017, Costal 'El Nino' phenomenon impacted the
North of Peru during March and April, bringing heavy rains, which
resulted in flooding and landslides in different areas.
Camposol's assets were not materially affected. The company is
investing in intensive shrimp ponds to reduce its exposure to
some of these environmental issues.

High Product and Geographic Concentration: Camposol's sales rely
on exports markets and its production originates in the north of
Peru. The company has been diversifying its production, but sales
remain concentrated on blueberries, avocados, and seafood. For
the period ended Sept. 30, 2017, blueberries, avocados and
seafood products accounted for approximately 85.6%, of total
sales revenue (12.7% blueberries, 49.7% avocados and 24.3%
seafood products). Any variation in price, cost, and volume of
these products would have an important impact on the company's
results. Exports to United States, Spain, Germany, the
Netherlands, and France collectively represented 80% of Camposol
revenues in 2016. Asia accounted for approximately 6% of
revenues.

IPO and Shareholders' Support: Fitch expects Camposol's main
shareholder to continue to financially support the company, if
needed. The shareholder injected USD5 million in March 2016,
although the company did not need shareholder funds to repay the
outstanding amount of the 9.875% secured notes due in February
2017. Camposol contemplates an IPO in the coming months and
intends to use cash proceeds to fund its growth. Fitch's view the
IPO positively as it aims to accelerate the company's expansion
by using equity and allows the company to diversify its source of
funding and improve liquidity.

Leading position in Peru: Camposol is a vertically-integrated
producer in Peru of food products such as avocados, blueberries,
tangerines, mangoes, grapes as well as shrimp. Avocados,
blueberries, and shrimps represented 53%, 40%, 8%, respectively,
of Camposol's total gross profit for the last 12 months (LTM)
ended Sept. 30, 2017. The company controls the entire value
chain: research and product development, growing fields and
ponds, processing facilities and sales and distribution channels.
Camposol benefits from the worldwide trends toward the
consumption of healthy and more convenient products.

DERIVATION SUMMARY

Camposol's ratings 'B' reflect the company's medium operational
scale and geographic concentration of its production base, which
is weaker than other commodity traders and processors such as
Tereos (BB) or Bunge (BBB). Camposol displays a business profile
that is unique in Fitch's commodity rated portfolio due to its
products sold (avocados, blueberries, and shrimps) whereas other
peers are mainly in the sugar and ethanol segments. The company's
operates in a higher business risk, commodity industry where
performance is subject to external shocks such as climatic
events, natural disasters and potential supply and demand
imbalances creating yield and price volatility of its products.
Fitch expects Camposol's debt/EBITDA ratio to move below 2x,
which is strong for the 'B' rating category and compares
favourably to other rated companies in the agricultural industry
such as Jalles Machado S.A. (B+/Stable) or Corporacion Azucarera
del Peru S.A. (BB-/Stable). These lower levels of leverage are
somewhat offset by the higher levels of industry risk, and
similar to its peers. The rating is also constrained by its
financial structure as all Camposol's debt is secured, which
limits financial flexibility and is not the case for its peers.
Fitch expects the company to continue to grow rapidly and
therefore generate negative FCF. No country-ceiling or operating
environment aspects impact the rating.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Its Rating Case for the Issuer:

-- EBITDA of about USD119 million in FYE17;

-- Increasing production, mainly in blueberries and avocados, as
    new plantations are entering into high-yield phases;

-- Debt / EBITDA towards 1.9x as of FYE17.

KEY RECOVERY RATING ASSUMPTIONS

Fitch believes that a debt restructuring would like occur under a
stress economic conditions and external shocks such as climatic
events or lack of access to certain exports markets Therefore,
Fitch has performed a going concern recovery analysis for
Camposol that assumes that the company would be reorganized
rather than liquidated.

Key going-concern assumptions are:

Camposol would have a going- concern EBITDA of about USD70
million. This figure is conservative at 40% below the company's
LTM EBITDA of USD116 Million. It takes into consideration factors
such as climatic events, logistic issues, potential strikes or a
shut-down of exports markets

-- A distressed multiple of 5.5x due to the exposure to the
    agri-business sector

-- A distressed EV of USD 344 Million (post 10% of
    administrative claims)

-- Total debt of USD165 million

The recovery performed under this scenario resulted in a recovery
level of 'RR1' consistent with securities historically recovering
91%-100% of current principal and related interest. Because of
the Fitch's 'RR4' soft cap for Peru, which is outlined in
criteria, Camposol's Recovery Rating has been capped at 'RR4'
reflecting average recovery prospects.

RATING SENSITIVITIES

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

-- Gross leverage below 2.0x on a sustained basis;
-- Improved geographical diversification of the production base;
-- Strong liquidity;
-- IPO and refinancing of the secured bond by unsecured debt.

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

-- Gross leverage above 4.0x;
-- EBITDA interest expenses coverage below 2.0x;
-- Negative FCF;
-- Weak liquidity.

LIQUIDITY

The company's liquidity is adequate. It is supported by its cash
on hand and the company's FCF generation. As of Sept. 30, 2017,
cash and cash equivalent totalled USD36 million compared to USD14
of short-term debt (working capital and current portion of long-
term debt). The short-term debt is comprised mainly of working
capital lines with banks and the long-term debt by the senior
secured debt, which is due in 2021.

FULL LIST OF RATING ACTIONS

Fitch has upgraded the following ratings:

Camposol Holding Ltd
-- Long-term foreign currency IDR to 'B' from 'B-';
-- Long-term local currency IDR to 'B' from 'B-'.

Camposol S.A.
-- Long-term foreign currency IDR to 'B' from 'B-';
-- Long-term local currency IDR to 'B' from 'B-';
-- Senior secured notes due 2021 to 'B/RR4 from 'B-/RR4'.

The Rating Outlook is Positive.



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C Z E C H   R E P U B L I C
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KRALOVOPOLSKA RIA: To Undergo Reorganization, Averts Bankruptcy
---------------------------------------------------------------
CTK reports that creditors of Kralovopolska RIA, which was
declared insolvent in August, on Dec. 1 decided that the
Brno-based engineering company can undergo reorganization.

According to CTK, reorganization had also been recommended by
insolvency administrator Ivo Sotek.

The decision means that the company will avoid bankruptcy,
CTK says.

Main creditors' claims amount to nearly CZK1.5 billion as of this
date, CTK notes.

Kralovopolska RIA has already taken a number of restructuring
steps towards optimization of costs, CTK states.  It has
dismissed roughly a half of its employees, reducing its staff
numbers to about 90 people, CTK recounts.

Kralovopolska RIA director Ctirad Necas said the company will
continue with the restructuring process and meeting of its
pledges, CTK relates.  Within 120 days, it will prepare a
reorganization plan, which it will submit to the creditors and
court, CTK states.

At the end of the Dec. 1 meeting, the creditors removed the
insolvency administrator and appointed a new one, CTK notes.

The Regional Court in Brno launched insolvency proceedings
against Kralovopolska RIA in June upon a petition filed by
British company FORMOSANA LIMITED, which claims that
Kralovopolska owes it about CZK40 million, CTK recounts.

Kralovopolska RIA however said it considers the insolvency
petition ungrounded, CTK relays.

Kralovopolska RIA ran into financial problems mainly in
connection with the reconstruction of two units of the Chvaletice
coal-fired power plant, whose operator, Sev.en EC, terminated its
contract with Kralovopolska at the end of June due to
Kralovopolska's alleged failure to meet deadlines, CTK discloses.

Sev.en EC subsequently lodged a claim for contractual penalty
exceeding CZK382 million and further claims amounting to tens of
millions of crowns, CTK states.

The Dec. 1 hearing in court revealed that Kralovopolska RIA, too,
had withdrawn from the contract with Sev.en EC and its claim
against the investor is reportedly the most precious asset of the
insolvency estate, CTK relates.

Kralovopolska RIA is an engineering and supplier company focusing
on the sector of nuclear energy, chemical and petrochemical
industries and water treatment.



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F R A N C E
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CGG SA: Paris Commercial Court Approves Safeguard Plan
------------------------------------------------------
CGG on Dec. 1 disclosed that the Commercial Court of Paris
approved the safeguard plan of CGG, after finding the claims
filed by certain holders of CGG's convertible bonds against this
draft plan inadmissible.

The next procedural step of CGG's financial restructuring is the
hearing scheduled on December 21, 2017, to consider the motion
for the recognition of the ruling approving the safeguard plan by
the competent US Bankruptcy Court within the context of the
Chapter 15 proceedings.

Subject to in particular a favorable decision by the US
Bankruptcy Court, the rights issue with preferential subscription
rights and allocation of free warrants to shareholders are
expected to be launched in mid-January, with the settlement and
delivery of the various securities issuances provided for under
the restructuring plan expected to occur by the end of February
2018.  It is to be noted that the Convertible Bonds due 2019 and
the Convertible Bonds due 2020 may now only give right to CGG
shares according to the terms of the approved safeguard plan.

The trading on Euronext Paris in CGG's shares (FR0013181864),
Convertible Bonds due 2019 (FR0011357664) and Convertible Bonds
due 2020 (FR0012739548), which was halted from 2:00 p.m. on
December 1, 2017 would resume as from December 4, 2017 at 9:00
a.m.

                     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.



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G E R M A N Y
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TRIONISTA TOPCO: Moody's Withdraws B1 Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings of Trionista
TopCo GmbH, the intermediate holding company of Germany-based
sub-metering provider ista International GmbH, including the B1
corporate family rating and the B1-PD probability of default
rating. At the time of the withdrawal, the ratings were on review
for upgrade. The withdrawal concludes the review for upgrade
process initiated on August 3, 2017.

RATINGS RATIONALE

Moody's has withdrawn ista's ratings for its own business
reasons. Effective October 18, 2017, ista was acquired by a joint
venture of CK Asset Holdings Limited (A2 stable) and CK
Infrastructure Holdings Limited (majority-owned subsidiary of CK
Hutchison Holdings Limited, A2 stable). In the context of the
transaction, the group's debt instruments were repaid.



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PROVIDE BLUE 2005-2: S&P Affirms CCC+ Rating on Class E Notes
-------------------------------------------------------------
S&P Global Ratings affirmed its credit ratings on PROVIDE BLUE
2005-1 PLC's class E notes and PROVIDE BLUE 2005-2 PLC's class D
and E notes.

S&P said, "Upon publishing our updated criteria for European
residential loans we placed those ratings that could potentially
be affected "under criteria observation".

"Following our review of these transactions, our ratings that
could potentially be affected by the criteria are no longer under
criteria observation.

"The affirmations follow our analysis of the transactions and the
application of our European residential loans criteria.

"In our opinion, the current outlook for the German residential
mortgage and real estate market is benign. The generally
favorable economic conditions support our view that the
performance of German residential mortgage-backed securities
(RMBS) collateral pools will remain stable in 2017. Given our
outlook on the German economy, we consider the base-case expected
losses of 0.4% at the 'B' rating level for an archetypical pool
of German mortgage loans, and the other assumptions in our
European residential loans criteria, to be appropriate.

"As the notes pay down fully sequentially, available credit
enhancement has increased proportionally for the rated notes in
both transactions since our previous reviews. However, losses on
the rated notes' threshold (first loss piece) have lessened this
benefit to the transactions.

"Since our previous reviews of these transactions, we have
observed a significant reduction in defaulted reference claims
(90+ days arrears and bankruptcies, which have been reported to
the trustee) in absolute terms to about EUR3.4 million from
EUR5.2 million in PROVIDE BLUE 2005-1 and to about EUR8.6 million
from EUR16 million in PROVIDE BLUE 2005-2. Since our previous
review of PROVIDE BLUE 2005-1, cumulative net losses have
increased to EUR8.2 million from EUR7.8 million, which has
reduced the size of the unrated class F notes to EUR5.3 million
from EUR5.7 million. Since our previous review of PROVIDE BLUE
2005-2, cumulative net losses have increased to EUR17.9 million
from EUR16.8 million, which has reduced the size of the first
loss piece to EUR3.21 million from EUR4.38 million

"In our analysis, we have assessed the likelihood of future
losses for both the performing and nonperforming parts of the
collateral pools by considering realized losses and delinquencies
to date in the portfolios.

"The observed loss severities on the foreclosed properties in
these transactions are higher compared with the loss severities
as calculated under our European residential loans criteria.
Given this difference, we therefore have concerns about the
reliability of the original valuations. That said, our criteria
do not include adjustments when we have concerns about the
reliability of the original valuations for the calculation of
loss severities as we view this as an originator-specific risk.
Therefore, to account for this specific risk in our analysis, we
have applied a valuation haircut (discount) of 20% on the whole
pool.

"We have affirmed our 'BBB- (sf)' rating on PROVIDE BLUE 2005-1's
class E notes and our 'BBB (sf)' rating on PROVIDE BLUE 2005-2's
class D notes because we consider the available credit
enhancement to be commensurate with our currently assigned
ratings on these classes of notes. We also considered our view of
the tail-end risk, given the transactions' small pool factors
(the outstanding collateral balance as a proportion of the
original collateral balance) and their sensitivity to recoveries.

"We have also affirmed our 'CCC+ (sf)' rating on PROVIDE BLUE
2005-2's class E notes because we consider the current level of
available credit enhancement to be commensurate with our
currently assigned rating, considering in our analysis the
sensitivity to recoveries and the tail-end risk.
"We also consider credit stability in our analysis. To reflect
moderate stress conditions, we adjusted our weighted-average
foreclosure frequency assumptions by assuming additional arrears
of 8% for one- and three-year horizons. This did not result in
our rating deteriorating below the maximum projected
deterioration that we would associate with each relevant rating
level, as outlined in our credit stability criteria."

PROVIDE BLUE 2005-1 and PROVIDE BLUE 2005-2 are partially funded
synthetic German RMBS transactions using the Provide Platform
provided by Kreditanstalt fÅr Wiederaufbau.

  RATINGS LIST

  Ratings Affirmed

  Class      Rating

  PROVIDE BLUE 2005-1 PLC
  EUR130 Million Floating-Rate Credit-Linked Notes

  E          BBB- (sf)

  PROVIDE BLUE 2005-2 PLC
  EUR155.9 Million Floating-Rate Credit-Linked Notes

  D          BBB (sf)
  E          CCC+ (sf)



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I T A L Y
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ALBA 8: Moody's Hikes Rating on Class C Notes From Ba1
------------------------------------------------------
Moody's Investors Service announced that it has taken rating
actions on the following classes of notes:

Issuer: Alba 7 SPV S.r.l.

-- EUR200M (Current Outstanding balance: EUR43,034,240) Class A2
    Notes, Confirmed at Aa2 (sf); previously on Jul 27, 2017 Aa2
    (sf) Placed Under Review for Possible Downgrade

Moody's also upgraded the following tranches of Alba 7 SPV
S.r.l.:

-- EUR100M Class B1 Notes, Upgraded to Aa2 (sf); previously on
    Apr 4, 2017 Upgraded to Aa3 (sf)

-- EUR50M Class B2 Notes, Upgraded to Aa2 (sf); previously on
    Apr 4, 2017 Upgraded to Aa3 (sf)

Issuer: ALBA 8 SPV S.r.l.

-- EUR335.3M (Current Outstanding balance: EUR16,831,825.29)
    Class A1 Notes, Confirmed at Aa2 (sf); previously on Jul 27,
    2017 Aa2 (sf) Placed Under Review for Possible Downgrade

-- EUR304.8M Class A2 Notes, Confirmed at Aa2 (sf); previously
    on Jul 27, 2017 Aa2 (sf) Placed Under Review for Possible
    Downgrade

Moody's also upgraded the following tranches of Alba 8 SPV
S.r.l.:

-- EUR127M Class B Notes, Upgraded to Aa3 (sf); previously on
    Jul 27, 2017 A1 (sf) Placed Under Review for Possible
    Downgrade

-- EUR45.7M Class C Notes, Upgraded to A3 (sf); previously on
    Apr 4, 2017 Upgraded to Ba1 (sf)

The rating actions conclude the reviews of the notes whose
ratings were placed on review for downgrade on July 27, 2017
following Moody's revised approach to assessing counterparty
risks in structured finance transactions
(http://www.moodys.com/viewresearchdoc.aspx?docid=PR_369760).

Alba 7 SPV S.r.l. is a securitisation of lease receivables
originated by Alba Leasing S.p.A. and granted to individual
entrepreneurs and small and medium-sized enterprises (SME)
domiciled in Italy mainly in the regions of Lombardia and Emilia
Romagna. Assets are represented by receivables belonging to
different sub-pools: real estate (18.37%), Cargo (15.33%) and
Construction & Building assets (7.93%). The securitized portfolio
does not include the so-called "residual value instalment", i.e.
the final instalment amount to be paid by the lessee (if option
is chosen) to acquire full ownership of the leased asset. The
residual value instalments are not financed -- i.e. it is not
accounted for in the portfolio purchase price -- and is returned
back to the originator when and if paid by the borrowers.

Alba 8 SPV S.r.l. is a securitisation of lease receivables
originated by Alba Leasing S.p.A. and granted to individual
entrepreneurs and small and medium-sized enterprises (SME)
domiciled in Italy mainly in the regions of Lombardia and Emilia
Romagna. The assets are represented by receivables belonging to
different sub-pools: real estate (24.68%), Energy (12.42%) and -
Construction & Building (12.31%). The securitized portfolio does
not include the so-called "residual value instalment", i.e. the
final instalment amount to be paid by the lessee (if option is
chosen) to acquire full ownership of the leased asset. The
residual value instalments are not financed -- i.e. it is not
accounted for in the portfolio purchase price -- and is returned
back to the originator when and if paid by the borrowers.

RATINGS RATIONALE

The rating actions are prompted by the two following reasons: (1)
the amendment of the term "Eligible Investments" in the terms and
conditions of the notes where by the minimum required Moody's
rating is now A3 and (2) the good performance and deleveraging of
the underlying leases in each transaction.

Moody's reassessed the default probability of the transactions'
account bank provider by referencing the bank's deposit rating.
The ratings of the notes are constrained by the issuer account
bank exposure in accordance with Moody's updated approach in
assessing the risk posed by the linkage to the issuer account
bank as part of the consolidated methodology to evaluating
counterparty risks in structured finance transactions.

Revision of key collateral assumption

The performance of Alba 7 SPV S.r.l. has been stable with 1.69%
overall cumulative defaults and 90+ delinquencies at 0.03%. As
part of the analysis, Moody's maintained the current balance
default probability assumption at 15.30% and fixed recovery rate
of 30%. These assumptions together with portfolio credit
enhancement of 25% result in coefficient of variation of 34.32%.

The performance of Alba 8 SPV S.r.l. has also been stable with
1.14% overall cumulative defaults and 0.04% 90+ delinquencies.
Moody's maintained the current balance default probability
assumption at 12.10% and fixed recovery rate of 30%. These
assumptions together with portfolio credit enhancement of 21%
result in coefficient of variation of 37.17%.

Principal Methodology:

The principal methodology used in these ratings was "Moody's
Approach to Rating ABS Backed by Equipment Leases and Loans"
published in December 2015.

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, (3) improvements in the credit quality of the
transaction counterparties, and (4) reduction in sovereign risk.

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


PATRIMONIO UNO: S&P Cuts Rating on Class F Notes to BB(sf)
----------------------------------------------------------
S&P Global Ratings lowered to 'BB (sf)' from 'BBB- (sf)' its
credit rating on Patrimonio Uno CMBS S.r.l.'s class F notes. At
the same time, S&P has affirmed its 'BBB- (sf)' ratings on the
class B, C, D, and E notes.

The rating actions follow S&P's review of the transaction's five
key rating factors (credit quality of the securitized assets,
legal and regulatory risks, operational and administrative risks,
counterparty risks, and payment structure and cash flow
mechanisms).

Patrimonio Uno CMBS is a true sale European commercial mortgage-
backed securities (CMBS) transaction that closed in 2006, with
notes totaling EUR397.8 million. The sole loan, which matures on
Dec. 31, 2017, was originally secured by 75 commercial properties
in Italy. Of those, 34 properties remain, with a current
securitized loan balance of EUR150.0 million.

CREDIT QUALITY OF THE SECURITIZED ASSETS

S&P said, "Our analysis considers the revenue and expense drivers
affecting the portfolio of properties in forecasting property
cash flow, in order to make appropriate adjustments. These
adjustments are intended to minimize the effects of near-term
volatility and ensure that the net cash flow (NCF) figure derived
from the analysis represents our view of a long-term sustainable
NCF (S&P NCF) for the portfolio of properties. This S&P NCF is
then converted into an expected-case value (S&P Value) using a
direct capitalization approach and capitalization rates
calibrated to our expected-case approach, which is akin to a 'B'
stress level. We derive our view of the loan-to-value ratio (S&P
LTV ratio) by applying our CMBS global property evaluation
methodology. We consider the S&P LTV ratio in our transaction-
level analysis, in conjunction with stressed recovery parameters
and pool diversity metrics, to determine credit risk and
ultimately credit enhancement for a CMBS transaction at each
rating category in accordance with our European CMBS criteria.

"Our credit analysis also takes into account our long-term
sovereign rating on the relevant jurisdiction."

PROJECT PATRIMONIO UNO LOAN [100% OF THE POOL]

The loan is backed by the net proceeds from the liquidation of--
and the availability of rental income from--the properties in the
portfolio, of which 34 remain. The majority of the properties are
traditional secondary office premises. However, some properties
provide training center accommodation.

The properties are let predominantly to government entities. The
lease to Agenzia del Demanio (the public land agency) contributed
approximately 77% of the portfolio's rental income in June 2017.
Agenzia del Demanio extended the lease until December 2023. The
June 2017 servicer report states a remaining weighted-average
unexpired lease term of 5.39 years and a current vacancy rate
of 15.6% for the whole portfolio.

LOAN AND COLLATERAL SUMMARY (AS OF MONTH YEAR)

-- Securitized loan balance: EUR150.0 million
-- Interest coverage ratio: 7.88x
-- LTV ratio: 46.88%
-- Net rental income: EUR13.3 million
-- Market value: EUR319.995 million (dated as of May 2017)
-- Net yield: 4.15%

S&P'S KEY ASSUMPTIONS

-- S&P NCF: EUR13.98 million
-- S&P Value: EUR168.1 million
-- Net yield: 7.9%
-- Haircut-to-market value: 47%
-- S&P LTV ratio (before recovery rate adjustments): 89%

S&P has assumed a full loan repayment in its 'B' rating stress
scenario.

OPERATIONAL RISKS

S&P said, "We apply our operational risk criteria to assess the
operational risk associated with transaction parties that provide
an essential service to a structured finance issuer. Where we
believe that operational risk could lead to credit instability
and have an effect on our ratings, these criteria call for rating
caps that limit the securitization's maximum potential rating."

Mount Street Loan Solutions LLP and Credito Fondiario SpA act as
servicers.

S&P's assessment of the operational risk associated with the
transaction parties does not constrain our ratings in this
transaction.

LEGAL AND REGULATORY RISKS

S&P said, "Under our legal criteria, we assess the extent to
which a securitization structure isolates securitized assets from
bankruptcy or insolvency risk of the entities participating in
the transaction, as well as the special-purpose entities'
bankruptcy remoteness.

"Our assessment of the legal and regulatory risk is commensurate
with the rating assigned."

COUNTERPARTY RISKS

S&P said, "Our current counterparty criteria allow us to rate the
notes in structured finance transactions above our ratings on
related counterparties if a replacement framework exists and
other conditions are met. The maximum ratings uplift depends on
the type of counterparty obligation.

"Our assessment of the counterparty risk for this transaction
does not constrain the ratings achieved from our credit review of
the securitized assets."

PAYMENT STRUCTURE AND CASH FLOW MECHANICS

S&P said, "Our ratings analysis includes an analysis of the
transaction's payment structure and cash flow mechanics. We
assess whether the cash flow from the securitized assets would be
sufficient, at the applicable rating levels, to make timely
payments of interest and ultimate repayment of principal by the
legal maturity date (December 2021), after taking into account
available credit enhancement and allowing for transaction
expenses and external liquidity support."

The transaction maintains a EUR16.97 million liquidity facility,
set up to mitigate senior expenses and interest payment
shortfalls on the notes. The facility is drawable for all issued
notes, although there are utilization caps for the class B to F
notes. S&P's analysis indicates sufficient amounts would still be
drawable to meet interest payments in our ratings analysis.

The liquidity facility is only available to meet the original
interest payments on the notes and does not include the
subordinated step up amounts on any note class.

RATING ACTIONS

S&P said, "Our analysis indicates that the available credit
enhancement for the class B to E notes is sufficient to absorb
the amount of losses that the underlying properties would suffer
at the 'BBB' rating level. However, a one-notch downward
adjustment to our analysis recognizes the imminent loan maturity
date, together with the lack of certainty relating to a possible
extension of the loan, and the proposed loan workout strategy, in
line with our European CMBS criteria.

"We have therefore affirmed our 'BBB- (sf)' ratings on the class
B, C, D, and E notes.

"Following our review, we do not consider the available credit
enhancement for the class F notes to be sufficient to absorb the
amount of losses that the underlying properties would suffer at
the currently assigned rating level. We have therefore lowered to
'BB (sf)' from 'BBB- (sf)' our rating on the class F notes."

RATINGS LIST

  Patrimonio Uno CMBS S.r.l.
  EUR397.828 mil asset-backed floating-rate notes
                                           Rating
  Class         Identifier          To             From
  B             IT0004070048        BBB- (sf)      BBB- (sf)
  C             IT0004070055        BBB- (sf)      BBB- (sf)
  D             IT0004070063        BBB- (sf)      BBB- (sf)
  E             IT0004070071        BBB- (sf)      BBB- (sf)
  F             IT0004078173        BB (sf)        BBB- (sf)



===================
L U X E M B O U R G
===================


M7 GROUP: S&P Assigns 'B+' Corp Credit Rating, Outlook Stable
-------------------------------------------------------------
S&P Global Ratings said it has assigned its 'B+' long-term
corporate credit rating to Luxembourg-based CDS Holdco III B.V.
(M7 Group). The outlook is stable.

S&P said, "We also assigned our 'B+' issue rating and '3'
recovery rating to the proposed senior secured EUR20 million
revolving credit facility (RCF) and EUR580 million term loan B
that the group plans to launch in December 2017. The recovery
rating indicates our expectation of meaningful (50%-70%; rounded
estimate: 50%) recovery in the event of a payment default."

The rating on M7 Group primarily reflects its relatively small
scale in the highly competitive telecommunications market, as
well as its aggressive capital structure and financial sponsor
ownership. S&P said, "In our view, the group is subject to
medium-term risks related to technological developments -- trends
to substitute direct-to-home (DTH) provisions by Internet
protocol television (IPTV) -- and increasing popularity of over-
the-top (OTT) content distribution. The group derives the
majority of revenues (about 50% forecast in 2017) from The
Netherlands, where its subscriber base continues to decline due
to alternatives and customer migration to higher pay packages. M7
Group's subscriber base is also decreasing in its second-largest
markets, the Czech Republic and Slovakia, due to service-fee
clients moving to the pay-TV model and being forced to migrate to
set-top boxes. We expect that the group's direct subscriber base
will decrease by about 4%-5% in 2017 and by 1%-2% in 2018-2019,
but this will be offset by an increasing number of business to
business and business to consumer customers in Germany and higher
average revenue per unit (ARPU) stemming from higher priced
packages and translating into overall positive revenue growth."

M7 Group's established niche market position in the Netherlands,
where it serves as the only DTH provider and operates in rural
areas where competition from cable and fiber is limited and in
border regions where there is no alternative, supports the
rating. The group is also expanding its international presence
and sees strong growth in customer numbers in Austria, where it
targets the mid-to-low priced niche in the market, offering
hybrid DTH and OTT services. In 2018, it plans to launch a new
consumer brand in Germany, which could allow it to benefit from
transitioning free customers to the pay-TV platform. After
incurring some extra launch costs in 2018-2019, we expect
adjusted EBITDA to reduce somewhat but that the group will
maintain its reported EBITDA margin at a sound level of about
30%.

As a result of the proposed refinancing and dividend
distribution, we anticipate that the group's S&P Global Ratings-
adjusted leverage will reach about 4.2x at the end of 2017 and
about 4.4x in 2018. S&P said, "We understand that while the
private equity sponsor's financial policy toward the group
remains aggressive, there are no plans for further shareholder
distribution and the risk of leverage increasing above 5x is
limited. The group's operating performance in 2017 is in line
with our expectations, and we forecast that in 2018-2019 it will
maintain its solid reported EBITDA margin at about 30% on the
back of improved revenue growth, increasing ARPU and tight
control over costs. We also expect that the group will continue
generating free operating cash flow (FOCF) EUR30 million-EUR50
million per year, which it could use to finance bolt-on
acquisitions or to gradually repay debt."

Overall, despite healthy margins, S&P's rating is constrained by
M7 Group's weaker standing compared with peers, mainly due to the
group's considerably smaller size compared with other European
and U.S.-based DTH operators, and due to the mature and saturated
nature of its key market in The Netherlands, which poses an
increased risk of subscriber churn and limits the group's growth
prospects.

S&P's base case assumes:

-- Real GDP growth in The Netherlands of 3% in 2017 and 1.9% in
2018, and about 1.8%-2.2% in the eurozone in 2017-2018. GDP
growth, recovering employment, and low inflation support consumer
confidence in M7 Group's key markets, but we note that there is
no direct correlation between macroeconomic indicators and the
group's operating performance, which is primarily driven by
competition, substitution risks, and the quality of its product
offering to the clients.

-- We forecast that M7 Group's revenues will decrease to about
EUR320 million in 2017 from almost EUR330 million in 2016, mainly
due to less hardware sales, but will return to growth at about
1%-5% in 2018-2019. This reflects our expectation that the direct
subscriber base in the group's key markets will decline at about
1%-2% per year due to the churn of customers to competitors, but
this will be offset by increasing customer numbers in Germany and
Austria and higher ARPU following the migration of customers in
the Czech Republic and Slovakia to higher priced packages.

-- Reported EBITDA of about EUR105 million in 2017 and EUR95
million-EUR100 million in 2018-2019, and reported EBITDA margins
of about 30%-33% in 2017-2019, reflecting higher costs related to
the launch of a new brand in Germany and tight control over other
costs.

-- Annual capital expenditure (capex) of EUR30 million-EUR40
million in 2017-2019.

-- A shareholder distribution of EUR175 million as part of the
proposed transaction in order to buy out minority investors.
No material acquisitions.

Based on these assumptions, we arrive at the following credit
measures in 2017-2019:

-- Adjusted debt to EBITDA of about 4.2x-4.4x.
-- Funds from operations (FFO) to debt of about 17%-19%.
-- Adjusted EBITDA interest coverage of about 5.0x.

S&P said, "The stable outlook reflects our view that M7 Group's
revenues will return to growth on the back of increasing ARPU and
the ramp up in subscriber numbers in Germany and Austria over the
next 12 months. This is despite the 1%-2% decline in the
subscriber base in the group's main markets of The Netherlands,
the Czech Republic, and Slovakia. We expect the group will
generate reported EBITDA margins of about 30% in 2017-2019,
supported by its flexible cost structure and cost controls, and
will maintain adjusted debt to EBITDA of less than 5.0x and
adjusted EBITDA interest coverage of about 5.0x.

"We could lower the ratings if the group's leverage increased
beyond our current forecasts, for example, due to large debt-
financed acquisitions or higher shareholder returns. We could
also consider a negative rating action if a more pronounced
decline in the subscriber base and higher operating costs led to
weaker EBITDA generation and adjusted debt to EBITDA increased to
5.0x or more, without prospects for a quick recovery.

"We currently consider an upgrade as unlikely, given the group's
ownership by financial sponsors and what we view as an aggressive
financial policy. A positive rating action is also unlikely due
to the group's relatively small scale in a highly competitive
industry, and its exposure to a mature and saturated home
market."



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


E-MAC PROGRAM II: Moody's Lowers Rating on Class D Notes to B3
--------------------------------------------------------------
Moody's Investors Service has upgraded the rating of one note in
E-MAC NL 2005-I B.V., downgraded the rating of one note in E-MAC
Program II B.V. / Compartment NL 2007-IV, and placed on review
for downgrade the rating of one note in E-MAC NL 2006-II B.V.
Moody's also affirmed the ratings of the two notes in E-MAC NL
2005-I B.V. and three notes E-MAC Program II B.V. / Compartment
NL 2007-IV that had sufficient credit enhancement to maintain
current rating on the affected notes.

Issuer: E-MAC NL 2005-I B.V.

-- EUR476.2M Class A Notes, Affirmed Aaa (sf); previously on Dec
    3, 2013 Confirmed at Aaa (sf)

-- EUR10.5M Class B Notes, Affirmed Aa3 (sf); previously on Dec
    3, 2013 Confirmed at Aa3 (sf)

-- EUR7.8M Class C Notes, Upgraded to A3 (sf); previously on Dec
    3, 2013 Confirmed at Baa1 (sf)

Issuer: E-MAC NL 2006-II B.V.

-- EUR5.5M Class C Notes, A3 (sf) Placed Under Review for
    Possible Downgrade; previously on Jun 27, 2017 Affirmed
     A3 (sf)

Issuer: E-MAC Program II B.V. / Compartment NL 2007-IV

-- EUR654.85M Class A Notes, Affirmed Aaa (sf); previously on
    Jun 27, 2017 Affirmed Aaa (sf)

-- EUR16.8M Class B Notes, Affirmed Aa1 (sf); previously on Jun
    27, 2017 Upgraded to Aa1 (sf)

-- EUR12.6M Class C Notes, Affirmed Aa3 (sf); previously on Jun
    27, 2017 Upgraded to Aa3 (sf)

-- EUR15.75M Class D Notes, Downgraded to B3 (sf); previously on
    Jun 27, 2017 Affirmed B1 (sf)

RATINGS RATIONALE

The upgrade of the Class C notes in E-MAC NL 2005-I B.V. is
prompted by the expected increase of credit enhancement for the
affected tranche. Total delinquencies have decreased in the past
year, with 60 days plus arrears currently standing at 1.16% of
current pool balance. As a consequence, the Reserve Account was
reduced to its floor amount at EUR2.5 million in October 2017.
The deal deleveraging will result in an increase in credit
enhancement for the affected tranche.

The downgrade of the Class D notes in E-MAC Program II B.V. /
Compartment NL 2007-IV reflects the reduction of excess spread.
The weighted average coupon of the mortgage pool decreased to
4.37% in October 2017 from 5.05% in October 2016. In the last
year, the decrease in portfolio yield resulted in drawings on the
reserve account which stands at EUR1,979,113 in October 2017,
below its EUR2.8 million target amount.

The placement on review for downgrade of the Class C notes in E-
MAC NL 2006-II B.V. reflects the reduction of the excess spread.
During the review process, Moody's seek to clarify the reasons
for the lower excess spread and to further refine the impact of
the decrease in portfolio yield: the weighted average coupon of
the mortgage pool decreased to 4.17% in October 2017 from 4.34%
in October 2016.

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.

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.



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


NORWEGIAN AIR 2016-1: Fitch Affirms BB- Rating on Class B Certs
---------------------------------------------------------------
Fitch Ratings has affirmed the ratings of Norwegian Air Shuttle
ASA's (NAS) aircraft Enhanced Pass Through Trust Certificates,
Series 2016-1 (NAS 2016-1):

-- Class A certificates due in May 2028 at 'A';
-- Class B certificates due in November 2023 at 'BB-'.

The final legal maturities for the class A and the class B
certificates are scheduled to be 18 months after the due dates.

KEY RATING DRIVERS

The collateral pool in this transaction consists of 10 2016
vintage 737-800s. Fitch views the 737-800 as a high quality Tier
1 aircraft. All aircraft in this pool feature a maximum take-off
weight (MTOW) of 174k lbs, which is the maximum for the 737-800
aircraft.

Senior EETC tranche ratings are primarily driven by a top-down
analysis incorporating a series of stress tests which simulate
the rejection and repossession of the aircraft in a severe
aviation downturn. The 'A' level rating is supported by a high
level of overcollateralization (OC) and high quality collateral,
which back Fitch's expectations that A-tranche holders should
receive full principal recovery prior to default even in a harsh
stress scenario. The ratings are also supported by the inclusion
of an 18-month liquidity facility and by cross-
collateralization/cross-default features. The structural features
increase the likelihood that the class A certificates could avoid
default (i.e. achieve full recovery prior to the expiration of
the liquidity facility) even if NAS were to file bankruptcy and
subsequently reject the aircraft.

The ratings also reflect the transaction's reliance on the Irish
insolvency regime, which Fitch views as protective of creditors'
rights but which has no specific provision protective of aircraft
creditor rights and differs from key aspects of the U.S.
Bankruptcy Code in that regard. The NAS 2016-1 transaction was
issued prior to Ireland adopting the Alternative A insolvency
remedy under the Cape Town Convention (CTC) on May 10, 2017.
While in the case of the airline's insolvency it is likely that
CTC (Alternative A) will apply to the NAS 2016-1 transaction,
Fitch's ratings rely on an analysis of the Irish insolvency laws
prior to the adoption of Alternative A.

A Tranche Ratings and Fitch's Stress Case:
Fitch's stress case utilizes a top-down approach assuming a
rejection of the entire pool of aircraft in a severe global
aviation downturn. The stress scenario incorporates a full draw
on the liquidity facility, an assumed 5% repossession/remarketing
cost, and a 20% stress to the value of the aircraft collateral.
The 20% value haircut corresponds to the low end of Fitch's 20%-
30% 'A' category stress level for Tier 1 aircraft.

These assumptions produce a maximum stress LTV of 91% through the
life of the deal which is down slightly when compared to 92.3% as
of April, 2017. The 91% stressed LTV implies full recovery prior
to default for the senior tranche holders in what Fitch considers
to be a harsh stress scenario and the stress results support the
'A' rating of the class A certificates.

B Tranche Ratings:
The rating of 'BB-' for the B tranche is reached by notching up
from NAS's stand-alone credit profile. Fitch notches subordinated
tranche ratings from the airline Issuer Default Rating (IDR)
based on three primary variables; 1) the affirmation factor (0-2
notches for issuers in the 'BB' category and 0-3 notches for
issuers in the 'B' category), 2) the presence of a liquidity
facility, (0-1 notch), and 3) recovery prospects. In this case
the uplift is based on a moderate affirmation factor,
availability of the liquidity facility and strong recovery
prospects. The rating is also supported by the class B
certificate holders' right in certain cases to purchase all of
the class A certificates at par plus accrued and unpaid interest.

Affirmation Factor:
Fitch considers the affirmation factor for NAS 2016-1 to be
moderate primarily driven by the company's fleet strategy which
contemplates a significant expansion over the next decade. As
stated earlier, Fitch considers the 737-800 to be a solid Tier 1
aircraft, but the expected increase in the NAS's fleet size with
newer and more fuel efficient aircraft will result in a
relatively rapid and continual decline in the strategic advantage
of the collateral backing the transaction.

The 737-800s represent an integral part of NAS' fleet. Norwegian
operates a single fleet type consisting of 737-800s and 737-MAX
8s in its short-haul fleet. As of Dec. 7, 2017, NAS operates a
fleet of 118 737-800s, six 737-MAX 8s and 21 787 Dreamliners
(both -8 and -9 variants). Fitch expects the percentage of the
pool compared to the NAS' total narrow body fleet will drop
considerably over the course of the transaction, given the
airline's high rate of growth and its current order book. As of
the end of 2016, the company's order book consisted of 255
aircraft including 19 737-800s (17 delivered by 3Q17), 108 737-
MAX8s (six delivered), 68 Airbus A320neos (three delivered), 30
Airbus A321sNeos and 30 787-9s (six delivered). Additionally, NAS
has purchase rights for 100 737 MAX 8s, 50 A320-neos and 10 787-
9s.

In a typical EETC transaction rated by Fitch, the underlying
collateral has clear affirmation advantages over other aircraft
in the obligor airline's fleet. In Fitch's view, this pool of 10
737-800s does not have a significant age advantage over the other
737-800s in the company's fleet because the entire fleet of NAS's
737-800s is quite young. The 737-800s in this transaction do not
represent the most attractive/fuel efficient aircraft in NAS'
fleet as the company already operates six 737-MAX 8s.

Irish Insolvency Law:
Fitch's EETC rating methodology reflects considerations of the
speed, certainty and costs associated with repossession,
deregistration and export of aircraft in different jurisdictions.
It also reflects consideration of the influence of creditors'
ability to quickly repossess aircraft on airlines' incentive to
affirm aircraft in bankruptcy (while paying all interest and
principal on time and in full). Section 1110 of the U.S.
Bankruptcy Code (which offers unique legal protection to aircraft
creditors in U.S.) and the Cape Town Convention (which offers
similar protections in countries implementing Cape Town
Alternative A) are two examples of legal frameworks cited in
Fitch's EETC rating methodology.

Neither Section 1110 nor the Alternative A of CTC applies for NAS
2016-1. However, the creditor-friendly nature and reliability of
the Irish legal regime, precedent under Irish law, and several
structural elements of the transaction that provide significant
credit protection allow Fitch to apply its EETC criteria to this
transaction.

If NAS were to become subject to insolvency proceedings (assumed
to be examinership rather than liquidation), Fitch believes that
so long as NAS desires to continue to fly the aircraft it is
probable that the certificates will remain current. In other
words, although NAS insolvency laws do not include a specific
provision geared to protecting the interests of aircraft finance
creditors akin to Section 1110 of the U.S. Bankruptcy Code,
Fitch's opinion is that the Irish regime, combined with the key
structural and other features noted above, practically speaking
leads to a similar outcome: examinership will not necessarily
result in a default on the class A and the class B certificates.

DERIVATION SUMMARY

The 'A' rating on the senior certificates is in line with Fitch's
ratings on senior classes of EETCs issued by Spirit Airlines,
Inc., United Airlines, Inc., British Airways, and American
Airlines, Inc. Fitch believes that this transaction is comparable
with the recent precedents. Stressed LTVs for the class A
certificates in this transaction are in line with those seen in
other transactions rated 'A', and the quality of the underlying
collateral pool is as good or better.

The 'BB-' rating on the class B certificates is the lowest rating
assigned to a B tranche by Fitch and is two notches lower than
the class B certificates of EETC transactions issued by American
Airlines (AA 2013-1 and AA 2013-2) and Hawaiian Airlines, Inc.
The notching differential between the NAS 2016-1 class B
certificates and other class B certificates is driven by
differences in the credit quality of the airlines, affirmation
factors, and recovery prospects. The ratings of the class B
certificates for NAS are based on a moderate affirmation factor.

KEY ASSUMPTIONS

Fitch's key assumptions within its rating case for the issuer
include a harsh downside scenario in which NAS declares
bankruptcy, chooses to reject the collateral aircraft, and where
the aircraft are remarketed in the midst of a severe slump in
aircraft values.

RATING SENSITIVITIES

Senior tranche ratings are primarily driven by a top-down
analysis based on the value of the collateral. Therefore, a
negative rating action could be driven by an unexpected decline
in collateral values. For the 737-800s in the deal, values could
be impacted by the entrance of the 737-8 MAX or by an unexpected
bankruptcy by one of its major operators. Fitch does not expect
to upgrade the senior tranche ratings above the 'A' level.

The ratings of the subordinated tranches are influenced by
Fitch's view of NAS's corporate credit profile. Fitch will
consider either a negative or a positive rating action if NAS's
credit profile changes in Fitch's view. Additionally, the ratings
of the subordinated tranches may be changed should Fitch revise
its view of the affirmation factor which may impact the currently
incorporated uplift or if the recovery prospects change
significantly due to an unexpected decline in collateral values.

Fitch may also consider downgrading all or some tranches of the
transaction if the aircraft backing NAS 2016-1 are subleased, de-
registered in Ireland and registered in another legal
jurisdiction which Fitch views as being inferior to the Irish
jurisdiction.

LIQUIDITY

Liquidity Facility: The certificates benefit from dedicated 18-
month liquidity facilities which will be provided by Natixis
(A/F1+/Stable).

The transaction features a 35-day replacement window in the event
that the liquidity facility provider or depositary should become
ineligible. This is inconsistent with Fitch's counterparty
criteria, which generally stipulate a maximum 30-day replacement
period. However, Fitch does not consider the longer replacement
window to be material given that the additional time period is
not significant.

FULL LIST OF RATING ACTIONS

Fitch has affirmed the following ratings:
Norwegian Air Shuttle ASA Enhanced Pass Through Certificates,
Series 2016-1

-- Class A certificates at 'A';

-- Class B certificates at 'BB-'.


SEADRILL LTD: Unsecured Bondholders Submits Rival Debt Plan
-----------------------------------------------------------
Nerijus Adomaitis at Reuters reports that an unofficial committee
of Seadrill's unsecured bondholders has submitted a binding
alternative proposal for the company's restructuring, two sources
familiar with the proposal said.

Norwegian-born billionaire John Fredriksen and a group of hedge
funds proposed on Sept. 12 to invest US$1.06 billion via new
equity and secured debt to restructure indebted Seadrill, once
the largest drilling rig operator by market value, Reuters
relates.

"Total investments (in the alternative plan) are on par with the
official restructuring proposal, but it's not a copy paste. It's
an improvement for unsecured bondholders," one source, as cited
by Reuters, said, declining to elaborate.

Monday, Dec. 11, was the deadline to submit binding proposals to
Seadrill, which has been seeking the best available deal as part
of its Chapter 11 bankruptcy procedure, Reuters notes.

The unofficial committee includes about 40 investors from the
United States, Europe and Asia, and funds managed by Nordic asset
manager DNB Asset Management, Nine Masts Capital Ltd of
Hong Kong, and U.S. hedge funds such as Phoenix Investment
Adviser LLC, Reuters discloses.

According to Reuters, Kris Hansen, a lawyer for Stroock & Stroock
& Lavan, who represents the group, has previously said the
unsecured bondholders felt they would recover too little compared
to Mr. Fredriksen and a group of funds supporting him.

                      About Seadrill Limited

Seadrill Limited is a deepwater drilling contractor, providing
drilling services to the oil and gas industry. It is incorporated
in Bermuda and managed from London. Seadrill and its affiliates
own or lease 51 drilling rigs, which represents more than 6% of
the world fleet.

As of Sept. 12, 2017, Seadrill employs 3,760 highly-skilled
individuals across 22 countries and five continents to operate
their drilling rigs and perform various other corporate
functions.

As of June 30, 2017, Seadrill had $20.71 billion in total assets,
$10.77 billion in total liabilities and $9.94 billion in total
equity.

Seadrill reported a net loss of US$155 million on US$3.17 billion
of total operating revenues for the year ended Dec. 31, 2016,
following a net loss of US$635 million on US$4.33 billion of
total operating revenues for the year ended in 2015.

After reaching terms of a reorganization plan that would
restructure $8 billion of funded debt, Seadrill Limited and 85
affiliated debtors each filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead
Case No. 17-60079) on Sept. 12, 2017.

Together with the chapter 11 proceedings, Seadrill, North
Atlantic Drilling Limited ("NADL") and Sevan Drilling Limited
("Sevan") commence liquidation proceedings in Bermuda to appoint
joint provisional liquidators and facilitate recognition and
implementation of the transactions contemplated by the RSA and
Investment Agreement. Simon Edel, Alan Bloom and Roy Bailey of
Ernst & Young serve as the joint and several provisional
liquidators.

In the Chapter 11 cases, the Company has engaged Kirkland & Ellis
LLP as legal counsel, HoulihanLokey, Inc. as financial advisor,
and Alvarez & Marsal as restructuring advisor. Willkie Farr &
Gallagher LLP, serves as special counsel to the Debtors.
Slaughter and May has been engaged as corporate counsel, and
Morgan Stanley serves as co-financial advisor during the
negotiation of the restructuring agreement.  Advokatfirmaet
Thommessen AS serves as Norwegian counsel.  Conyers Dill &
Pearman serves as Bermuda counsel.  PricewaterhouseCoopers LLP
UK, serves as the Debtors' independent auditor; and Prime Clerk
is their claims and noticing agent.

On September 22, 2017, the Office of the U.S. Trustee appointed
an official committee of unsecured creditors.  The committee
hired Kramer Levin Naftalis& Frankel LLP, as counsel; Cole Schotz
P.C. as local and conflict counsel; Zuill& Co. as Bermuda
counsel; Quinn Emanuel Urquhart & Sullivan, UK LLP as English
counsel; Advokatfirmaet Selmer DA as Norwegian counsel; and
Perella Weinberg Partners LP as investment banker.



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


BANCO COMERCIAL: Fitch Rates EUR300MM Subordinated Notes B+
-----------------------------------------------------------
Fitch Ratings has assigned Banco Comercial Portugues, S.A.'s
(Millennium bcp) issue of EUR300 million subordinated notes due
2027 a final rating of 'B+'.

The final rating is in line with the expected rating Fitch
assigned to the notes on December 4, 2017.

KEY RATING DRIVERS

The subordinated notes are notched down once from Millennium
bcp's 'bb-' Viability Rating (VR). The notching reflects the
notes' greater expected loss severity relative to senior
unsecured debt. These securities are subordinated to all senior
unsecured creditors. Fitch did not apply additional notching for
incremental non-performance risk relative to the VR given that
any loss absorption would only occur once the bank reaches the
point of non-viability.

RATING SENSITIVITIES

The subordinated notes' rating is sensitive to changes in
Millennium bcp's VR. The rating is also sensitive to a widening
of notching if Fitch's view of the probability of non-performance
on the bank's subordinated debt relative to the probability of
the group failing, as measured by its VR, increases or if Fitch's
view of recovery prospects changes.



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


ALTAI REGION: Fitch Affirms B+ Long-Term IDR, Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed Russian Altai Region's Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDRs) at
'BB+' with Stable Outlooks and Short-Term Foreign-Currency IDR at
'B'.

KEY RATING DRIVERS

The affirmation reflects Fitch's view regarding the region's
sound fiscal performance and very low overall risk. The ratings
also take into account the below national average wealth metrics
of the local economy, Altai's modest fiscal capacity as well as a
weak institutional framework for Russian sub-nationals.

Fitch forecasts a sound operating balance of 13%-15% of operating
revenue over the medium term after peaking at 20.7% in 2016. This
was driven by the sharp growth of corporate income tax and the
government's tight cost control leading to a 6% decline in
operating expenditure. Fitch expect deceleration of operating
revenue growth due to the region's reduced share of excise duty
and corporate income tax proceeds in 2017. However, this should
be compensated to some extent by higher current transfers from
the federal government.

At the same time, Fitch considers the region's tax capacity will
remain below its national 'BB+' peers over the medium-term. This
implies that federal transfers will continue to constitute a
notable proportion of Altai's budget, averaging about 40% of
operating revenue annually in 2017-2019.

During 10M17, Altai collected 86% of its full-year budgeted
revenue and incurred 74% of its full-year budgeted expenditure,
which resulted in an intra-year surplus of RUB5.2 billion. Fitch
expect acceleration of expenditure by end-2017, which would lead
to a year-end deficit of about RUB1.7 billion or 2% of total
revenue (2016: surplus of 5.7%).

Fitch also forecasts the region will record a moderate deficit of
1%-2% in 2018-2019 due to expected higher expenditure. The
expected deficit will be covered by a material cash balance of
RUB6.7 billion as of 1 January 2017. This will limit recourse to
new debt.

Historically the region's debt has been low, with subsidised
federal budget loans being the sole debt instrument since 2007.
Altai's direct risk accounted for a low RUB2.2 billion or 2.8% of
current revenue in 2016, while a strong cash balance led to a
positive net cash position. Fitch expect Altai's direct risk to
remain low by national and international standards over the
medium-term, corresponding to higher rated peers.

Fitch assesses Altai's economy as weak by international standards
due to the region's low economic output per capita. Its 2015
gross regional product (GRP) per capita was 63% of the national
median. This is in part due to the high proportion of agriculture
and food processing in the local economy. According to the
region's government estimates, the local economy grew by 1.8% yoy
in 2016 after stagnation in 2015. Fitch expects the Russian
economy will continue a moderate recovery at 2.0% in 2017-2019,
and Altai will likely follow this trend.

The region's credit profile remains constrained by the weak
institutional framework for Russian local and regional
governments (LRGs), which has a shorter record of stable
development than many of their international peers. Weak
institutions lead to lower predictability of Russian LRGs'
budgetary policies, which are subject to continuous reallocation
of revenue and expenditure responsibilities within government
tiers.

RATING SENSITIVITIES

Consolidation of the region's strong budgetary performance with a
sustained operating margin of about 15% while maintaining low
direct risk could lead to an upgrade.

A downgrade could result from significant deterioration in
operating performance, coupled with a significant increase in the
region's overall risk.


CHUVASH REPUBLIC: Fitch Affirms BB+ Long-Term IDR, Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has affirmed the Russian Chuvash Republic's
(Chuvashia) Long-Term Foreign- and Local-Currency Issuer Default
Ratings (IDRs) at 'BB+' with Stable Outlooks and Short-Term
Foreign-Currency IDR at 'B'. The agency has also affirmed the
republic's outstanding senior debt at 'BB+'.

The affirmation reflects the republic's sound fiscal performance
and moderate direct risk with some refinancing pressure. The
ratings also factor in the modest size of the republic's budget,
a fiscal capacity that is below the national average and a weak
institutional framework for Russian subnationals.

KEY RATING DRIVERS

Fitch expects Chuvashia to continue its sound fiscal performance
in 2017-2019, albeit with its operating margin weakening to a
still high 15%-16% from a peak of 18.6% in 2016. This will be
underpinned by cost control measures, gradual tax revenue growth
in line with an expected recovery of the Russian economy and
ongoing transfers from the federal government.

At the same time the moderate size of the republic's local
economy and budget result in a smaller tax capacity and ability
to absorb potential shocks than national 'BB+' peers. This leads
to a steady flow of federal transfers, which will constitute a
notable proportion of Chuvashia's budget, averaging about a third
of operating revenue annually in 2017-2019.

In 2016 the republic recorded a material improvement of its
budgetary performance with an operating margin increasing to
18.6% from an average 8% during 2014-2015. This was driven by
growth of tax revenue and the administration's tight control of
operating expenditure, which fell 2.9%. The exceptionally strong
fiscal performance in 2016 led to a surplus before debt variation
of 5.1% of total revenue, after a period of large deficits
averaging 7.9% in 2014-2015.

During 10M17, the republic has collected 83% of its full-year
budgeted revenue and incurred 71% of its full-year budgeted
expenditure, which resulted in an intra-year surplus of RUB4.3
billion. Fitch expects an acceleration of expenditure towards
year end to result in a deficit of about RUB1.3 billion or 3% of
total revenue for 2017 according to Fitch's base case scenario.
Fitch also forecasts the region will record a moderate deficit of
2%-3% in 2018-2019, due to an expected higher expenditure.

Fitch believes that the expected 2017 deficit will be covered by
the republic's cash balance of RUB2.7 billion (as of 1 January
2017), hence limiting new borrowings. Fitch forecasts moderate
growth of direct risk to about RUB15.5 billion over the medium
term (2016: RUB14.2 billion). Direct risk should remain moderate
at below 40% of current revenue (2016: 38.6%) and the republic's
direct risk-to-current balance should consolidate at two to three
years, compared with an average of five years in 2011-2015.

Chuvashia's direct risk profile is dominated by low-cost budget
loans, which temporarily reached 92% as of 1 November 2017 (end-
2016: 63%). The proportion of budget loans will likely decline to
below 50% in the medium term, as market debt (bonds and bank
loans) increases its share, adding pressure on debt servicing and
refinancing needs.

As of end-10M17, about 60% of Chuvashia's direct risk will mature
over the next three years, exposing the republic to refinancing
pressure. The republic's recently announced programme of
restructuring of federal budget loans should ease refinancing
peaks and lengthen the life of debt, although the weighted
average life of debt will likely remain short (end-10M17: 3.5
years) by international comparison.

The republic's socio-economic profile is historically weaker than
that of the average Russian region. Its per capita GRP was 62% of
the national median in 2015. According to preliminary estimates,
the republic's economy marginally grew in 2016 after a 2.7%
contraction in 2015, which is in line with the national economic
trend. Fitch expects the Russian economy will see a moderate
recovery in 2017-2019, and Chuvash will likely follow this trend.

Russia's institutional framework for sub-nationals constrains the
republic's ratings. It has a shorter record of stable development
than many of its international peers. The predictability of
Russian LRGs' budgetary policy is hampered by frequent
reallocation of revenue and expenditure responsibilities within
government tiers.

RATING SENSITIVITIES

Consolidation of strong budgetary performance with an operating
margin about 15% on a sustained basis, accompanied by moderate
direct risk and reduced refinancing pressure, could lead to an
upgrade.

Growth of direct risk, accompanied by deterioration in the
operating performance leading to a direct risk-to-current balance
rising above eight years on a sustained basis, would lead to a
downgrade.


KAZAN CITY: Fitch Affirms BB- Long-Term IDR, Outlook Stable
-----------------------------------------------------------
Fitch Ratings has affirmed the Russian City of Kazan's Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDRs) at
'BB-', with Stable Outlooks, and Short-Term Foreign-Currency IDR
at 'B'.

KEY RATING DRIVERS
The 'BB-' rating reflects the city's high direct risk, low
operating balance and a weak institutional framework for Russian
sub-nationals. The ratings also factor in Kazan's diversified
economy, the long-term repayment schedule of the city's debt, and
stable support from the Republic of Tatarstan (BBB-/Positive), of
which Kazan is the capital.

Under Fitch's base case scenario, direct risk will remain high at
about RUB30 billion in 2017-2019 (2016: RUBB29.8 billion),
declining in relative terms to 135% of current revenue in 2019
from 150% in 2016. Around 85% of direct risk comprises RUB25
billion low-cost budget loans from Tatarstan, which were
allocated to infrastructure development in preparation for
Universiade 2013, hosted by the city.

The high debt levels are mitigated by the budget loans' long-term
repayment schedule and low 0.1% annual interest rates. The loans
have a grace period until 2023 and the principal amortises in 10
annual instalments to 2032. By end-November 2017, the city's
interim direct risk has been reduced to RUB28.1 billion following
partial repayment of outstanding bank loans with temporarily
available cash to save on interest payments. This would help
underpin a sustainable positive current balance over the medium
term after volatile performance in 2014-2016. Fitch expects
direct risk will return to about RUB30 billion by year-end as the
city will need to fund budgeted expenditure.

Kazan's interim fiscal performance was in line with Fitch's
expectation. At end-10M17, the city has collected 80% of its
full-year budgeted revenue and incurred 74% of its budgeted
expenditure, which resulted in a small intra-year surplus of
RUB130 billion. Fitch projects that the city will record a
deficit before debt variation in 2017-2019 after two years of
surpluses in 2015-2016. However, the deficit will likely be small
at 1%-2% of total revenue and will be funded by the city's
accumulated cash balance (end-2016: RUB1.7 billion).

The city is committed to restricting new market borrowings (bank
loans and bonds) until it has fully repaid its outstanding budget
loans in 2032, as part of a loan restructuring agreement with
Tatarstan in 2013. Fitch therefore project Kazan's direct debt
will stabilise at RUB4.8 billion in 2017-2019, equal to 20%-25%
of current revenue.

The city's financial flexibility remains weak, in Fitch's view.
Fitch forecasts Kazan's operating balance will remain low at 2%-
3% of operating revenue (2016: 3.7%) in 2017-2019. This will be
supported by the administration's cost control measures and
Tatarstan's allocation of additional share of personal income tax
collection to the city's budget (0.5ppts in 2017 and 1.7ppts in
2018).

Kazan's budgetary policy is dependent on the decisions of the
regional and federal authorities. This result in stable flows of
earmarked current transfers received from Tatarstan's budget,
which averaged 37% of operating revenue in 2014-2016. Tatarstan
also directly finances investment projects in Kazan, which
reduces pressure on the city's capital expenditure.

The city's capex declined to 10% of total expenditure in 2014-
2016, from an average 34% in 2011-2013, after completion of the
Universiade-related projects. Fitch expects Kazan will maintain
capex at this level over the medium term, which will support the
administration's commitment to restrict new borrowings.

As Tatarstan's capital, the city's economy is boosted by the
republic's diversified economic profile with a well-developed
industrial sector. The administration estimates the city's
economy will return to an average 2% annual growth in 2017-2020
after two years of stagnation. This is likely to be driven by
growth of the republic's economy, which the Tatarstan government
expects at 2.8% in 2017 and above 3% in 2018-2020, outpacing the
Russian GDP growth forecast of 1.8%-2% in 2017-2019.

The city's credit profile remains constrained by the weak
institutional framework for Russian local and regional
governments (LRGs), which has a shorter record of stable
development than many of its international peers. Weak
institutions lead to low predictability of Russian LRGs'
budgetary policies, which are subject to the federal government's
continuous reallocation of revenue and expenditure
responsibilities within government tiers.

RATING SENSITIVITIES

A material decline of direct risk below 100% of current revenue,
accompanied by higher financial flexibility and an operating
margin above 5% on sustained basis, could lead to an upgrade.

An increase in direct debt to above 50% of current revenue or a
weakening of the operating balance towards zero could lead to a
downgrade.


KRASNODAR REGION: Fitch Affirms BB LongTerm IDRs, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed Russian Krasnodar Region's Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDR) at 'BB'
with Stable Outlook and Short-Term Foreign-Currency IDR at 'B'.
The region's outstanding senior unsecured domestic debt has been
affirmed at 'BB'.

KEY RATING DRIVERS

The ratings and Stable Outlook reflect Fitch's expectation of the
consolidation of the region's budgetary performance and a close-
to-balanced budget over the medium-term as well as material,
albeit decreasing, net overall risk. The ratings also take into
account the region's diversified economic profile, exposure to a
large public sector, and a weak institutional framework for
Russian sub-nationals.

Fitch expects the region will maintain stable budgetary
performance with an operating balance at around 7% of operating
revenue in 2017-2019 (2016: 7.7%) and a close-to-balanced budget.
This is a notable improvement compared with its 2013-2015 results
of a modest operating margin averaging 3.2% and large budget
deficits. Consolidation of the budgetary performance will be
underpinned by a moderate expansion of the tax base and control
over operating spending.

During10M17, the region has collected 89% of its budgeted revenue
and incurred 74% of its budgeted expenditure for 2017, which led
to an interim budget surplus of RUB33.7 billion. Fitch expects
that acceleration of spending - both operating and capital -
towards the end of the year will shrink the regional budget to a
minor surplus by end-2017.

Fitch projects that an improved operating balance and capex
limitation will translate into a close-to-balanced budget for the
medium-term. Capex is likely to remain below 10% of total
expenditure in 2017-2019 following the material upgrade of the
region's infrastructure in 2011-2013 when capex peaked at 30% of
total spending. This heavy investment was made in preparation for
the Sochi Winter Olympic Games in 2014.

Fitch expects direct risk will continue to decline relative to
current revenue to 60%-65% in 2017-2019 (2016: 71.8%). Direct
risk is currently higher than the national 'BB' median but this
is mitigated by the region's favourable debt composition, 50% of
which were subsidised budget loans bearing negligible annual
interest rates as of 1 November 2017. Of this amount, around 70%
is linked to financing for the Olympics facilities, which matures
between 2023 and 2034. This allows a reduction in annual debt
servicing and eases refinancing pressure on the budget.

In August 2017, Krasnodar issued a RUB10 billion amortising
domestic bond due in 2024, smoothing its debt maturity profile.
As a result the weighted average life of debt improved to about
nine years as of 1 November 2017 from 6.5 years as of 1 June
2017. Nevertheless, as with most of its national peers the region
remains exposed to some refinancing pressure with 44% of its
maturities being due in 2017-2019. As of 1 November 2017 the
region had to repay RUB5.3 billion of debt by year-end, which is
comfortably covered by the region's liquidity of RUB22.8 billion.

Krasnodar is exposed to contingent risk stemming from its large
public sector. Fitch estimates that contingent liabilities
accounted for around 10% of the region's current revenue at end-
2016. The majority of the contingent liabilities refer to a
guarantee issued in favour of the Olympics developer NPJSC Centre
Omega (Omega). In 2017, Omega extended its debt maturity until
2022 (from 2021) and negotiated lower interest rates. Under the
new agreement the region guaranteed the full debt to the amount
of RUB21.2 billion, which includes both principal and interest
repayments.

In 2016-2017, the region's guarantee was called to repay RUB1.6
billion to Omega's creditor, and Fitch believes further payments
by the region related to this guarantee are possible. This is
included in the region's budgeted expenditure for the medium-term
and will not result in additional risk. According to the
administration Omega has started to sell non-core properties in
2017 to fund debt repayment. Fitch estimates that the region's
net overall risk will continue to gradually decline over the
medium-term and will not exceed 70% in 2019 (2016: 76.5%).

Krasnodar Region's economy is large by national comparison and
diversified, providing a broad tax base. Krasnodar is among the
top five Russian regions by gross regional product (GRP) and
population, and its GRP per capita is 8% above the national
median (2015). According to the administration's estimates GRP
grew 0.9% in 2016 while the national economy contracted 0.2%. The
administration expects GRP will grow by 2.3% in 2017 and 2.5%-
2.9% in 2018-2019, supported by developing processing industries
and implementation of infrastructure projects.

Fitch views Russia's weak institutional framework for local and
regional governments (LRGs) as a constraint on the region's
ratings. It has a short track record of stable development
compared with many of its international peers. Unstable
intergovernmental set-up leads to lower predictability of LRGs'
budgetary policies and negatively affects the region's
forecasting ability, and debt and investment management.

RATING SENSITIVITIES

An operating balance of about 10% of operating revenue on a
sustained basis, accompanied by improvement in the direct risk-
to-current balance ratio to about five years (2016: 17 years)
could lead to an upgrade.

A consistently weak operating balance insufficient to cover
interest expenses or inability to maintain the net overall risk
to current revenue at below 100% would lead to negative rating
action.


ROSEVROBANK: S&P Affirms 'BB-/B' ICRs, Outlook Stable
-----------------------------------------------------
S&P Global Ratings said that it had affirmed its 'BB-' long-term
and 'B' short-term issuer credit ratings on Rosevrobank. The
outlook remains stable.

The affirmation reflects Rosevrobank's continued good track
record of revenue generation, stable asset quality, good coverage
metrics, and its ample liquidity. The affirmation also takes into
account the possible acquisition of an additional minority stake
in Rosevrobank by Sovcombank (BB-/Stable/B).

S&P said, "We note that Rosevrobank's business position reflects
our view of its stable business model with a sustainable track
record of revenue generation, good revenue diversification, and
an established management team, in addition to the positive
influence on the bank's corporate governance practices by the
minority shareholders, European Bank for Reconstruction And
Development and DEG (German Investment Corporation). Our base
case is that the bank will retain its prudent corporate
governance even after the potential exit of these shareholders."

Rosevrobank is a midsized bank with total assets of Russian ruble
(RUB) 174 billion ($3 billion) as of Oct. 1, 2017, and is ranked
48th among more than 600 Russian banks in terms of assets.
Despite its smaller size, Rosevrobank average return on assets
was about 3% over the past five years, sustainably above that of
local peer banks.

S&P said, "We believe that Rosevrobank's capitalization is
adequate. Our risk-adjusted capital (RAC) ratio before
adjustments for concentration and diversification will be 9.5%-
10.0% in the next 12-18 months. Our base case includes the
operations of Rosevrobank only. Other assumptions include:

-- Loan portfolio growth of around 7%-8% in 2017-2019, as the
    group does not expect to expand materially faster than the
    system.

-- Net interest margin slightly decreasing to 5.7%-5.9% in 2017-
    2019 from 6.2%-6.3% in 2015-2016, which is in line with
    overall trends in the banking sector.

-- In line with its dividend policy, the dividend payout will be
    about 30% of net income in 2018-2019. The bank has already
    paid dividends of RUB1.5 billion pertaining to 2017.

-- Still high credit costs for 2017, slightly below 2% (but
    lower than in 2016 and 2015), mostly driven by relatively
    conservative reserving. S&P expects credit costs to then
    reduce to 0.9%-1.1% in 2018, driven by no expected growth in
    nonperforming loans (NPLs; loans overdue 90 days or more).

S&P said, "Our assessment of Rosevrobank's risk position as
adequate reflects the bank's good loan portfolio quality and
diversity, low related-party lending, and solid risk-management
practices, which have allowed it to manage well through the
financial crises since 1998.

"In our opinion, the bank follows strong underwriting procedures
in both the corporate and retail segments. The corporate segment,
which accounts for 84% of the overall portfolio as of Sept. 30,
2017, is well diversified among the heavy industrial, trading,
servicing, transport, and consumer goods segments.

However, the bank has sizable exposure to state organizations
(varying between 16% and 21% of total loans in the past two
years). Lending to construction and real estate businesses, which
S&P considers risky, made up 11.1% of loan book on Sept. 30,
2017, which is lower than in most other Russian banks.

The top 20 borrowers accounted for 35.5% of the bank's loan book
and 104% of total adjusted capital as of Sept. 30, 2017, which is
better than peers' average.

In the retail segment, the bank targets low risk products, such
as mortgage loans and lending to payroll clients

NPLs made up 2% of total loans as of Sept. 30, 2017, compared
with our estimate for the domestic banking system being about
10%. Another 2.6% of the bank's loans had been restructured as of
the same date. Loan-loss reserves made up 9.4% of overall loans
and covered 473% of NPLs. S&P expects NPLs (including
restructured loans) to remain below the Russian banking sector
average in the next two years, not exceeding 5% of total loans.

S&P said, "We assess Rosevrobank's funding as average and its
liquidity as adequate, reflecting our expectation that the bank's
funding base will likely remain stable and its liquidity buffers
will be sufficient to cover liquidity needs in the coming 12-18
months. The bank's loan-to-deposit and stable funding ratios were
at comfortable levels of 68.9% and 146.3%, respectively, on Sept.
30, 2017.

"The stable outlook on Rosevrobank reflects our anticipation that
the bank will be able to preserve its credit standing in the next
12 months. In particular, we expect the bank will continue
demonstrating strong profitability, supporting its capital
buffers and maintaining the solid quality of its loan portfolio.
We also expect that benefits to risk and governance culture will
remain even if there were a change of ownership.

"We could take a negative rating action in case we see unexpected
negative developments coming from significant management turnover
or deterioration of corporate governance procedures, which would
affect the Rosevrobank's franchise. We would also consider a
downgrade if the bank experienced material deposit outflows that
depleted its currently adequate liquidity buffers.

"Although not our base-case scenario, we could raise our rating
on Rosevrobank if its capitalization strengthened significantly,
with our RAC ratio staying sustainably above 10% as a result of
capital injections or earnings retention."


YAMAL-NENETS REGION: S&P Affirms 'BB+' ICR, Outlook Positive
------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' long-term issuer credit
rating on Yamal-Nenets Autonomous Okrug (YANAO). The outlook is
positive.

OUTLOOK

The positive outlook on YANAO mirrors that on Russia. Any rating
action S&P takes on the sovereign would likely be followed by a
similar action on YANAO.

Downside Scenario

S&P said, "We could revise our outlook on YANAO to stable
following a similar action on Russia. Alternatively, if we were
to revise down our assessment of YANAO's stand-alone credit
profile (SACP), which is currently one notch higher than our
long-term rating on the okrug, this could translate into downward
rating pressure. However, we see such a development as unlikely."

Upside Scenario

S&P could upgrade YANAO if we upgraded Russia.

RATIONALE

S&P said, "We cap our long-term rating on YANAO at the level of
the 'BB+' foreign currency long-term rating on the Russian
Federation (foreign currency BB+/Positive/B, local currency BBB-
/Positive/A-3), based on our view that Russian local and regional
governments (LRGs) cannot be rated above the sovereign. In this
view, we include our assessment of Russia's institutional
framework as volatile and unbalanced, in which we consider that
Russian LRGs have very restricted revenue autonomy and would be
unable to withstand possible negative intervention from the
federal government.

"We assess the stand-alone credit profile (SACP) for YANAO at
'bbb-'. The SACP is not a rating but a means of assessing an
LRG's intrinsic creditworthiness under the assumption that there
is no sovereign rating cap.

Very wealthy but concentrated economy in the volatile and
unbalanced institutional framework

Like other Russian regions, YANAO's financial position relies
highly on the federal government's decisions under Russia's
institutional setup, which remains unpredictable. The federal
government makes frequent changes to taxing mechanisms that
affect regions. The recent introduction of limits to the amount
of losses interregional holdings are allowed to apply to the tax
base will partly mitigate the effect of the 1% decrease in the
federal government's redistribution of the corporate profit tax
(CPT) to LRGs in 2017.

YANAO's economy is dominated by gas production, which underpins
the region's very high wealth levels, but also leads to high
economic and tax base concentration and volatility. YANAO holds
about 70% of Russia's total proven gas reserves, and the world's
largest gas producer, Gazprom, remains the main investor,
employer, and taxpayer in the region. S&P expects that oil and
gas production will continue to make up more than 50% of the
okrug's gross regional product and about 40% of its budgeted
revenues in 2017-2019.

Decisions regarding regional revenues and expenditures are
centralized at the federal level, leaving little budgetary
flexibility to the okrug's authorities. More than 90% of YANAO's
tax revenues are controlled by federal legislation, which makes
it especially difficult for the okrug to address potential
revenue volatility. Like most Russian LRGs, YANAO's modifiable
revenues (mainly transport tax and nontax revenues) are low and
don't provide much flexibility. We forecast they will account for
less than 10% of the okrug's operating revenues on average over
the next three years. However, S&P believes YANAO has more leeway
on the spending side than peers, due to its relatively large
self-financed capital program, which it thinks it could reduce
at least by one-half if necessary.

S&P said, "We note YANAO's improved expenditure management, with
the implementation of tighter control of spending growth. We also
think the okrug's debt and liquidity management have strengthened
significantly in the past few years." Management has diversified
the okrug's funding base by issuing longer-term bonds,
constructing a smoother debt repayment schedule, keeping high
cash reserves, and holding medium-term revolving bank lines.

Strong balances result in low debt and an important cash cushion

S&P said, "We expect YANAO's operating margins will remain above
5% of operating revenues, and deficits after capital accounts
will be relatively small over the next three years. Still, the
okrug's financial indicators will remain subject to volatility.
Large fluctuations in YANAO's tax revenues stem from its
dependence on a single taxpayer and from frequent changes in
federal tax legislation. In the past couple of years, the CPT's
robust performance--representing about 30% of the okrug's tax
revenues--has strongly supported the okrug's revenues, owing to
the stronger operating results of the main taxpayers, in the
context of a more stable ruble exchange rate and positive gas
price dynamics. We expect CPT growth will normalize in the next
several years, while revenue growth will likely be supported by
the increase in the property tax, after the cancellation of
federally imposed tax exemptions granted to infrastructure
companies, and a broadening of the tax base following
commissioning of new industrial facilities in the coming years.

"YANAO's tax-supported debt will remain below 30% of consolidated
operating revenues through year-end 2019, in our view. The
okrug's tax-supported debt includes the guarantee the LRG
provides to its government-related entities (GREs), mainly to the
okrug-owned construction company handling the program for
resettlement from dilapidated housing. In addition to the okrug's
direct debt, we include in our assessment of YANAO's debt burden
the debt of GREs, mainly Yamalgossnab GUP, the company that
ensures wholesale distribution of petroleum and petroleum
products to the remote polar areas of the okrug.

YANAO's GRE sector is relatively small compared with those of
Russian peers. S&P said, "We think its GREs and municipalities
are unlikely to require significant extraordinary financial
support through year-end 2019. We estimate the maximum loss under
a stress scenario at less than 2% of the okrug's consolidated
operating revenues."

S&P said, "We expect that in the next 12 months, the okrug's cash
reserves will well exceed its very low debt service of about
Russian ruble (RUB) 2 billion (about $33 million at the time of
writing), by our estimate. The okrug's average cash, including
cash of its budgetary units, will likely exceed RUB25 billion
($416 million) in the same period. At the same time, we
incorporate the okrug's limited access to external liquidity in
our overall assessment of its liquidity. This is because of the
weaknesses of the domestic capital market, and applies to all
Russian LRGs. We also note that in the near term, YANAO's debt
service will likely remain below 5% of operating revenues, on
average.

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

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

The committee agreed that revenue and expenditure management had
improved. All other key rating factors were unchanged.

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

RATINGS LIST

                                       Rating
                                 To                From
  Yamal-Nenets Autonomous Okrug
   Issuer Credit Rating
  Foreign and Local Currency     BB+/Positive/--  BB+/Positive/--



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


BANCO POPULAR ESPANOL: Creditors Opposes Koenig Reappointment
-------------------------------------------------------------
Alexander Weber and Tom Beardsworth at Bloomberg News report that
creditors of Banco Popular Espanol SA who lost their investments
are balking at the possible reappointment of Elke Koenig as chair
of the euro area's bank resolution authority.

According to Bloomberg, lawyers acting on behalf of investors
told European Union lawmakers that reappointing Ms. Koenig would
put the credibility of the SRB and the EU's resolution regime at
risk.  They also faulted the European Commission, the EU's
executive arm, for not shortlisting an alternative candidate,
Bloomberg discloses.

"The serious errors of judgment of the current chair strongly
militate in favor of the appointment of a new chair of the SRB,
who can ensure the agency complies fully with the professional
obligations and standards" required by the law, Quinn Emanuel
Urquhart & Sullivan, as cited by Bloomberg, said in a letter to
Roberto Gualtieri, the chair of the European Parliament's
Committee on Economic and Monetary Affairs.

The firm said it's acting on behalf of Algebris
Investments, Anchorage Capital Group and Ronit Capital, which
lost money in the wind-down of Popular, Bloomberg relates.

The failure was the first test for the Brussels-based SRB, which
Ms. Koenig has led since it opened its doors in 2015, Bloomberg
notes.

On Nov. 29, the commission nominated her to run the agency for a
second term, which would run until the end of 2022, Bloomberg
recounts.  The parliament and the European Council, which
represents the interests of national governments, have to approve
the nomination, Bloomberg discloses.

Ms. Koenig has been praised by some for handling the Popular
crisis without using taxpayers' cash or setting off a domino
effect in the markets, Bloomberg states.  Yet investors burned
when the bank's equity and about EUR2 billion (US$2.4 billion)
junior bonds were wiped out have a different view, according to
Bloomberg.  They've targeted Ms. Koenig in particular, saying she
exacerbated liquidity outflows from Popular through comments made
in an interview with Bloomberg TV.

                       About Banco Popular

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

As reported in the Troubled Company Reporter-Europe on June 15,
2017, S&P Global Ratings said that it raised its long- and short-
term counterparty credit ratings on Banco Popular Espanol S.A.
to 'BBB+/A-2' from 'B/B'.  The outlook is positive.

In addition, S&P lowered its issue-level ratings on Banco
Popular's outstanding preference shares and subordinated debt to
'D' from 'CC' and 'CCC-', respectively, and S&P subsequently
withdrew them.

The rating actions follow the Single Resolution Board's
announcement on June 7, 2017, that it had taken a resolution
action in respect of Banco Popular.  This resulted from the ECB's
conclusion that the bank was failing or likely to fail as a
result of a significant deterioration in its liquidity position.
The resolution entailed the sale of Banco Popular to Banco
Santander S.A. (A-/Stable/A-2) for EUR1, after absorption of
losses by Banco Popular's shareholders and holders of Tier 1 and
Tier 2 capital instruments.


CAIXABANK RMBS 3: Moody's Assigns (P)Caa3 Rating to Cl. B Notes
---------------------------------------------------------------
Moody's Investors Service has assigned provisional ratings to
CAIXABANK RMBS 3, FONDO DE TITULIZACION's Class A and B notes:

Issuer: CAIXABANK RMBS 3, FONDO DE TITULIZACION

-- EUR[2,295]M Class A Notes due September 2062, Assigned (P)A3
    (sf)

-- EUR[255]M Class B Notes due September 2062, Assigned (P)Caa3
    (sf)

CAIXABANK RMBS 3, FONDO DE TITULIZACION is a static cash
securitisation of prime mortgage loans extended mainly to
obligors located in Spain. [52.28]% of the portfolio consists of
drawdowns of flexible mortgages and [47.72]% standard mortgage
loans secured on Spanish residential properties. In terms of the
ranking of the security, [54.35]% of the pool is secured by
first-lien mortgages while [45.65]% is secured by second-lien
mortgages (where CaixaBank is holding the first ranking
security).

RATINGS RATIONALE

CAIXABANK RMBS 3, FONDO DE TITULIZACION is a securitisation of
loans that CaixaBank, S.A. (Baa2/P-2/ Baa1(cr)/P-2(cr)) granted
mainly to Spanish individuals. CaixaBank, S.A. (Baa2/(P)P-2/
Baa1(cr)/P-2(cr)) is acting as the servicer of the loans, while
CaixaBank Titulizaci¢n, S.G.F.T., S.A. is the management company.

The provisional ratings take into account the credit quality of
the underlying mortgage loan pool, from which Moody's determined
the Moody's Individual Loan Analysis Credit Enhancement ("MILAN
CE") assumption and the portfolio's expected loss.

The key drivers for the portfolio's expected loss of [6.0]% are
(i) the [45.65]% exposure to second-lien mortgages which Moody's
considers riskier than first ranking mortgages and lead to a
higher expected default frequency and more severe losses than
first-ranking mortgages; (ii) benchmarking with comparable
transactions in the Spanish market through the analysis data in
CaixaBank, S.A.'s (Baa2/(P)P-2/ Baa1(cr)/P-2(cr)) book; (iii)
very good track record of previous Residential Mortgage-Backed
Securities ("RMBS") originated by CaixaBank, S.A. (Baa2/P-2/
Baa1(cr)/P-2(cr)) (the Foncaixa Hipotecarios series) although
arrears are steadily increasing in most recent CaixaBank RMBS
transactions; (iv) Moody's outlook on Spanish RMBS in combination
with the seller's historic recovery data; and (v) the fact that
[4.37]% loans in the pool are less than 30 days in arrears and
[0.63]% are more than 30 days but less than 60 days in arrears,
although most of the pool has never been in arrears more than 90
days.

The transaction's [21.0%] MILAN CE number is higher than other
Spanish RMBS transactions. The MILAN CE's key drivers are (i) the
current weighted-average loan-to-value ("LTV") ratio of [64.19%]
(calculated taking into account the latest full property
valuation); (ii) the well-seasoned portfolio, which has a
weighted-average seasoning of [7.18] years; (iii) the fact that
only [3.65]% of the borrowers in the pool are non-Spanish
nationals and only [0.98]% are non-Spanish residents; (iv) the
absence of broker-originated loans in the pool; (v) the [37.01]%
concentration in the Catalonia region; and (vi) the [8.36]%
exposure to restructured loans in the pool.

[52.28%] of the pool consists of drawdowns of flexible mortgages,
which are structured like a line of credit. Under these flexible
mortgages, borrowers can make additional drawdowns up to a
certain LTV ratio limit, for an amount equal to the amortised
principal. As a result, flexible mortgages lead to a higher
expected default frequency and more severe losses than for
traditional mortgage loans. Additionally, [41.30%] of the
borrowers have the option to benefit from payment holiday
periods, where principal is not paid, and [24.75%] of the pool
can avail of principal and interest grace periods.

Moody's considers that the deal has the following credit
strengths: (i) the full subordination of the Class B notes'
interest and principal to the Class A notes; (ii) the notes'
sequential amortisation; and (iii) a fully funded reserve upfront
equal to [4.5]% of the notes ([4.0]% after the elapse of two
years), which covers potential shortfalls in the Class A notes'
interest and principal during the transaction's life (and
subsequently of the Class B notes, once the Class A notes have
fully amortised).

The portfolio mainly contains floating-rate loans linked to 12-
month Euribor [69.4]%, or "Indice de Referencia de Prestamos
Hipotecarios conjunto de entidades de credito" ("IRPH"), whereas
the notes are linked to three-month Euribor and reset every
quarter on the determination dates. This leads to an interest-
rate mismatch in the transaction. Additionally, [18.2%] of the
provisional pool comprises of fixed-rate loans. Therefore, there
is a potential fixed-to-floating-rate risk, whereby the Euribor
rate on the notes increases, while the interest rates on the
loans remain constant. There is no interest-rate swap in place to
cover interest-rate risk. Moody's takes into account the
potential interest rate exposure as part of its cash flow
analysis when determining the notes' provisional ratings.

The provisional ratings address the expected loss posed to
investors by legal final maturity. In Moody's opinion, the
structure allows for the timely payment of interest and the
ultimate payment of principal for the Class A notes by legal
final maturity. Moody's provisional ratings only address the
credit risks associated with the transaction. Other non-credit
risks have not been addressed, but may have a significant effect
on yield to investors.

Moody's issues provisional ratings in advance of the final sale
of securities, but these ratings only represent Moody's
preliminary credit opinion. 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 will disseminate
the assignment of any definitive ratings through its Client
Service Desk.

STRESS SCENARIOS

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. At the
time the provisional ratings were assigned, the model output
indicated that the Class A notes would have achieved a A3 (sf)
rating if the expected loss was maintained at 6.0% and the MILAN
CE was maintained at 21.0%, and all other factors were constant.
If the expected loss was maintained at 6.0% but MILAN CE was
increased to 25.2%, and all ofher factors were constant, model
output indicated that the Class A notes would have achieved a
Baa1 (sf) rating.

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 typical EMEA RMBS transaction are
calculated by stressing key variable inputs in Moody's primary
rating model.

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
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 that may lead to an upgrade of the ratings include a
significantly better-than-expected performance of the pool,
combined with an increase in the notes' credit enhancement and a
change in Spanish Local Currency Ceiling .

Factors that may cause a downgrade of the ratings include
significantly different loss assumptions compared with Moody's
expectations at closing due to either (i) a change in economic
conditions from Moody's central forecast scenario; or (ii)
idiosyncratic performance factors that would lead to rating
actions; or (iii) a change in Spain's sovereign risk, which may
also result in subsequent rating actions on the notes.



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


ISTANBUL: Fitch Affirms 'BB+/B' Issuer Default Ratings
------------------------------------------------------
Fitch Ratings has affirmed the Metropolitan Municipality of
Istanbul's Long-Term Foreign-Currency Issuer Default Rating (IDR)
at 'BB+' and Short-Term Foreign-Currency IDR at 'B'. Fitch has
also affirmed Istanbul's Long-Term Local-Currency IDR at
'BBB-'and National Long-Term Rating at 'AAA(tur)'. The Outlooks
are Stable.

The affirmation reflects Istanbul's continued solid operating
performance in line with Fitch unchanged base case scenario and
expected increase in debt stemming from large capex realisations,
which would be supported by healthy operating balance, keeping
debt to current balance below two years on average.

The ratings further take into account the large unhedged FX
liabilities of the city and therefore the depreciation risk the
city is exposed to, which mitigated by the amortising nature and
lengthy maturity of its debt and its predictable monthly cash
flows and city's good access to financial markets.

KEY RATING DRIVERS

Fiscal Performance (Strength/Stable): Fitch projects Istanbul
will continue to post strong operating margins in the high 40s in
2017-2019, thanks to its well diversified economy and opex
largely remaining in line with operating revenue growth over the
forecast period. Following the sovereign's upward revision of
national GDP for 2017, Fitch expect shared tax revenue
attributable to the metropolitan area to increase by 1% to 16%
yoy in 2017.

According to the 2Q17 interim budgetary results, the city had
already achieved 51.7% of budgeted operating revenue, which
reflects robust continuation of local economic growth, whereas
operating expenditure came in lower than operating revenue at
46.8% Nevertheless, Fitch expects opex to surpass operating
revenue by 6% by year end.

Fitch estimates the city will continue to post on average large
budget deficits before financing at 20% of the total revenue, due
to expected significant capex realisation prior to local
elections in 2019. This will not be fully covered by the current
balance and capital revenue, increasing debt funding. Istanbul
has tendered infrastructure projects for the construction of an
additional 74.7km of 150km light railway/metro lines to date.
Fitch continue to expect realisation of capex of on average 90%
of the budgeted amount in 2017-2019.

Debt & Liquidity (Neutral/Negative): In line with Fitch previous
forecast, Fitch expects direct risk to increase significantly to
TRY18.5 billion at end 2019 from TRY8.7 billion at end 2016, as
the city is shifting its borrowing to intercompany borrowing due
to zero interest rates and netting out this debt by asset
transfers rather than cash. A significant rise in borrowing is
due to expected significant capex realisation of TRY27.5 billion
in 2017-2019, prior to local elections in 2019.

Direct risk includes Other Fitch classified debt, which is
primarily driven by Istanbul's expected intercompany borrowing
from its affiliate ISKI (water and waste water management) at
zero interest rate for which no payment has been made to date.
This also includes IETT's (bus operator) debt, which accounted
for TRY152.9 million at end 2016. Fitch expect intercompany
borrowing to increase to TRY7.1 billion at end 2019 from TRY4
billion at end 2016.

ISKI is Istanbul's only profitable affiliate and its debt is
negligible with debt to current revenue below 1%. At end 2016 it
posted a surplus of TRY190.4 million after lending to city
amounted to TRY1.35 billion. The city's contingent liabilities
are low, as almost all of its companies are self-funding. Their
debt accounted for 2.4% of the city's operating revenue in 2016.

After adjusting for intercompany borrowing, which will not be
paid off in cash, Fitch expect direct debt to increase to TRY11.6
billion at end 2019 from TRY6.6 billion at end 2016. This will
lead the debt to current revenue ratio to increase to about 70%,
less than Fitch previous estimates of 80% as intercompany
borrowing is increasing. However, Fitch expect a healthy
operating balance keep the debt to current balance to below two
years in 2017- 2019.

Istanbul faces significant foreign exchange risk in times of
elevated financial volatility, as 98% of its debt at end-2016 was
foreign currency-denominated and unhedged, up from 97% in 2015.
Euro-denominated loans constitute 91% of foreign-currency debt,
with the remainder US dollar-denominated loans.

The weighted maturity of FX debt was nine years at end-2016, well
above its expected debt payback (direct debt/current balance)
ratio of two years. Together with the city's predictable and non-
seasonal monthly cash flows, several credit lines with state-
owned and commercial banks, this mitigates short-term refinancing
risk and extends the debt servicing of the FX loans.

Economy (Strength/Stable): Istanbul is Turkey's main economic
hub, contributing on average 30.5% of the country's gross value
added in 2006-2014 (latest available statistics), with wealth
levels far above the average. This enables fiscal strength and
very good access to financial markets and therefore liquidity.
Rapid urbanisation and continued immigration flows challenge the
metropolitan municipality, with a continued need for
infrastructure investments. In 2016, the population grew 1.0% yoy
to 14.8 million.

Management (Neutral/Negative): Istanbul has a track record of
disciplined expenditure policy, with an expenditure realisation
rate of about 100% of the budgeted total expenditure in the last
year. Nevertheless, a significant increase in capex realisation
ahead of the local elections increases the accumulation of debt
funding, which weakens liquidity, constraining fiscal
flexibility. Also a lack of an explicit strategy means the
repayment of intercompany borrowing from ISKI is not transparent.

Institutional Framework (Weakness/Stable): Istanbul's credit
profile is constrained by a weak Turkish institutional framework,
reflecting a short track record of stable relationship between
the central government and the local governments with regard to
allocation of revenue and responsibilities, weak financial
equalisation system and the evolving nature of its debt
management in comparison with international peers.

RATING SENSITIVITIES

Istanbul's rating is at the sovereign rating level. A reduction
of the city's debt-to-current revenue below 60% on a sustainable
basis, coupled with continued financial strength and consistent
management policies, could be trigger positive rating action,
provided there was a sovereign upgrade.

Negative rating action on Turkey would be mirrored on Istanbul's
ratings. A sharp increase in Istanbul's direct debt-to-current
balance above two years for two consecutive years, driven by
capex and local currency depreciation could also lead to a
downgrade of its Long-Term IDRs.


MAKRO MARKET: Enters Into Agreement with Nine Creditors
-------------------------------------------------------
Taylan Bilgic at Bloomberg News reports that Makro Group
Chairman Seref Songor said Makro Market, currently under
concordato ruling, has reached an agreement in principle with
nine creditors.

According to Bloomberg, some properties of the company will be
taken over by the banks.

The company will be able to take them back if it can repay its
debt in three years, Bloomberg discloses.

Talks with suppliers continue while agreement on receivables of
some suppliers has been reached, Bloomberg relays, citing
Hurriyet newspaper.

Makro Market filed for concordato on Oct. 27, Bloomberg recounts.



=============
U K R A I N E
=============


* UKRAINE: Several Small Banks at Risk of Bankruptcy
----------------------------------------------------
Ukrainian News Agency reports that the National Bank of Ukraine
believes that several small banks may go bankrupt.

"We have completed the cleanup of the banking sector.  We do not
expect large banks to go bankrupt.  We have a problem only with
small banks.  They will leave the market.  However, this will not
have a big impact on the financial stability of the country and
the banking sector," Ukrainian News Agency quotes Vitalii
Vavryschuk, the director of the National Bank of Ukraine's
financial stability department, as saying.

According to Ukrainian News Agency, Mr. Vavryschuk said Ukrainian
banks are currently liquid and capitalized.

At the same time, according to him, the National Bank of Ukraine
has questions about the business models of a number of banks,
Ukrainian News Agency notes.

Mr. Vavryschuk, as cited by Ukrainian News Agency, said the main
problems of the banking sector are the fact that the state has a
large share of about 56% and the fact that problem loans account
for 56% of all loans.

He also said that the National Bank of Ukraine was working on
recognition of credit risks by banks, Ukrainian News Agency
relates.



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


ALPHA GROUP: Fitch Assigns 'B(EXP)' LT Issuer Default Rating
------------------------------------------------------------
Fitch Ratings has assigned Alpha Group S.a.r.l. (A&O Hotels and
Hostels) an expected Long-Term Issuer Default Rating (IDR) of
'B(EXP)' with a Stable Outlook. In addition, Fitch has assigned
the senior secured debt, including the term loan and RCF, an
expected issue rating of 'BB-(EXP)'/'RR2'.

A&O's rating is supported by its track record of operating a
network of over thirty hostels, and its expansion of that network
over the last fifteen years. These properties have a low cost of
operations and have operating margins above their peers. The
rating is constrained by the high leverage of the transaction,
the increased execution risk as A&O expands outside Germany, and
the increased capex required to renovate its existing properties
and to extend its brand to the ultra-low-cost hotel market.

KEY RATING DRIVERS

Low Operating Costs: A&O operates a network of hostels and ultra-
low-cost hotels both in Germany and in neighbouring countries.
These facilities are large scale and operate with low overheads
by focusing on its core market of group travel. To further
develop its customer base, A&O is refreshing its brand and
renovating its facilities to gain additional visits from
individuals and small groups, such as families. A&O's business
model's low break-even occupancy rate of 30% and value focus make
it relatively resilient to economic cycles and it has the
potential to generate additional growth if occupancy increases
from the current levels.

Strong German Core Market: A&O has grown steadily in the German
market from its initial location in Berlin and it is the largest
hostel chain in Europe. The German market benefits from a strong
and growing economy and structural support from a large number of
school groups that travel within the country. A&O has developed a
strong German network, but it may be approaching a point of
saturation in the market as demonstrated by the firm's expansion
in neighbouring countries. These locations may not have the same
structural advantages as Germany, and A&O will probably incur
higher sales and marketing costs in developing these markets.

High FCF Offset by High Leverage: After the transaction, A&O will
have high FFO adjusted leverage of near 8x, which will then fall
towards 7x over the forecast horizon. This is partly due to
leased properties which add around one turn of leverage. This is
mitigated by strong and improving FCF, with FCF margins
increasing from 1% in 2018 to above 10% as growth capex declines.
In addition, while the leases do add to leverage, the FFO fixed
charge coverage ratio will be kept at, or near 2x over the
forecast horizon. A&O's business model has sufficient stability
and cash-flow generating capacity to fund near-term growth capex
and to maintain the high degree of financial leverage.

Diverse Portfolio of Properties: A&O's property development
strategy has involved either purchasing or leasing properties in
need of renovation in either central urban locals or locations
with convenient transportation. It has been able to renovate
these properties through flexible use of space rather than
demolishing the building and constructing a new build like many
budget hotels. This has allowed A&O to lower costs and achieve
favourable lease terms. A&O has demonstrated expertise in new
property development, but there remains a risk that as it moves
into new cities it will not be able to acquire properties at the
same level of affordability or in as favourable locations.

Strong Demand for Budget Accommodation: Europe is under-
penetrated in value-oriented travel accommodation, particularly
of the kind that can accommodate large groups. By taking a price
leadership position while offering amenities such as en suite
showers, free Wi-Fi and in-room TV that will appeal to non-
student travellers, A&O has the potential to grow into a Europe-
wide brand. However, the discount travel accommodation market is
highly competitive with a number of low cost hotels such as
Travelodge as well as camp sites and sharing economy sites (such
as AirBnB) that offer alternatives.

A&O's business model that straddles the line between hostel and
hotel is innovative but the extent that it can scale throughout
Europe has yet to be determined.

DERIVATION SUMMARY

A&O is the largest hostel companies in Europe and a strong market
leader in Germany where the group's demand is underpinned by
German school policy of annual trips. In the European lodging
industry as a whole, A&O focuses on urban cities and leisure
travellers while NH Hotels and B&B are more heavily focused on
suburban areas and business customers (around 60% of revenue).
Its size is limited, with revenue of EUR120 million at end-2017,
but its profitability as measured by EBITDAR or FFO remains above
its direct peers.

KEY ASSUMPTIONS

- Sales growth falling from 11% in 2017 towards 6% in 2020
- Stable EBITDAR margins around 47%
- The addition of four new properties by 2019
- Capex of 18% of sales in 2018, falling to 7% by 2021after
   completion of property upgrade programme

KEY RECOVERY ASSUMPTIONS

- The recovery analysis assumes that Alpha Group Sarl would be
   considered as liquidated in bankruptcy
- Fitch have assumed a 10% administrative claim
- The liquidation estimate reflects Fitch's view of the value of
   hotel properties and other assets that can be realised in a
   reorganisation and distributed to creditors
- Fitch assumed an 80% advance rate on the value of the owned
   properties based on third-party valuations.
- These assumptions result in a recovery rate for the senior
   secured debt within the 'RR2' range to allow a two-notch
   uplift to the debt rating from the IDR

RATING SENSITIVITIES

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

- Material increase in scale in line with B+ rated peers
- FFO adjusted gross leverage sustainably below 6.0x
- FFO FCC sustainably above 2.5x
- FCF margin above 5%

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

- Erosion in occupancy rate or significant reduction in EBITDA
   margins
- FFO adjusted leverage above 8.0x
- FFO FCC below 2.0x for a sustained period
- FCF of minus 2% for two consecutive years

LIQUIDITY

Adequate Liquidity: At the closing of the transaction, Fitch
expects A&O to have EUR50 million of cash on its balance sheet.
In addition, A&O benefits from a EUR50 million RCF fully undrawn
at closing. Given positive FCF and a lack of short-term
maturities or other debt repayments, Fitch considers this
sufficient to meet A&O's liquidity needs.


JAGUAR LAND: Moody's Revises Outlook to Stable, Affirms Ba1 CFR
---------------------------------------------------------------
Moody's Investors Service has affirmed Jaguar Land Rover
Automotive Plc's (JLR) Ba1 corporate family rating (CFR) and Ba1-
PD probability of default ratings well as all Ba1 senior
unsecured instrument ratings. The outlook has been changed to
stable from positive.

"The outlook change to stable reflects JLR's deterioration in
profitability with Moody's adjusted EBITA margin declining from
10% in Fiscal Year 2015 (FY) to below 4% for the last twelve
months period as of September 2017 as well as free cash flow
generation turning negative since FY17," says Falk Frey, a Senior
Vice President and lead analyst for JLR.

RATINGS RATIONALE

Given the weakening in results, both in terms of profitability,
as well as in JLR's ability to generate positive free cash flow,
positive pressure on the Ba1 rating has abated. Although JLR's
profitability and cash flow generation improved in Q2 FY18 (Sep
30, 2017) compared to Q1 FY18, financial metrics remain at levels
that position the company properly in the Ba1 rating category.
Moody's also anticipates a rather volatile performance over the
next quarters and a gradual improvement over time which will be
unlikely to create upward pressure on ratings. Moody's calculates
the adjusted EBITA margin for the LTM period as of September 30,
2017 at 3.8% compared to 4.8% in FY17. Also, Moody's adjusted
free cash flow for the LTM period has been negative GBP 667
million, a further deterioration compared to the negative GBP 135
million in the last fiscal year (FY17).

Jaguar Land Rover's (JLR) Ba1 CFR continues to reflect the
company's strong brand names with an increasingly successful
track record of launching new models; the commitment of its
parent Tata Motors Limited, Ba1 stable (TML) to support JLR's
product strategy, capex plan and financial strategy, in line with
previous practice and the good liquidity profile. The rating also
recognizes a degree of support from the broader Tata Group
although Moody's currently consider JLR's ratings to be capped at
a maximum of one notch above that of Tata Motors Limited. (TML,
rated Ba1 stable).

However, the key challenges that JLR is facing are somewhat
offsetting these positive factors, such as, in general, the
cyclical nature of the automotive industry, albeit less so for
premium car manufacturers, which can be exposed to big swings in
performance combined with high fixed costs; JLR's large focus on
the SUV segment and degree of dependency on a few successful
models; ongoing challenges, contributing to high capex
requirements, to ensure its model range meets the required
emissions and fuel consumption levels in major car markets such
as Europe, China and the US leading to a negative FCF generation
in the coming years and a high foreign exchange rate exposure
although JLR has an established FX hedging programme.

LIQUIDITY

JLR's liquidity profile as of September 30, 2017 is deemed as
good. Moody's expect the company will have sufficient cash
sources, comprising readily available cash, funds from operations
and undrawn committed credit lines to cover its cash uses over
the next 12-18 months, including significantly increasing capex,
debt repayments, cash for day-to-day operations, working capital
and dividend payments. JLR extended in July 2017 its revolving
credit facility which amounts to GBP1,855 million to mature in
July 2022 (undrawn as of September 30, 2017). There is no longer
a financial covenant in this facility.

RATING OUTLOOK

The stable Outlook reflects Moody's expectation that JLR's
product renewals and additional model launches will lead to an
improvement in profitability and other credit metrics over time.

The stable outlook also assumes that JLR will be able to weather
the challenging landscape as a result of heavy investment
requirements for (1) alternative propulsion technologies; (2)
autonomous driving; (3) the shift of production capacities
towards alternative fuel vehicles; (4) connectivity; as well as
(5) regulations relating to vehicle safety, emissions and fuel
economy.

WHAT COULD CHANGE THE RATINGS DOWN/UP

JLR's ratings could come under pressure in case of the company's
EBITA margin remaining below 5.5% (4.8% for FY2017) combined with
a material negative free cash flow generation for a sustained
period of time as well as an increase in its Moody's-adjusted
leverage ratio approaching 3.0x.

Moody's caution that a potential downgrade of TML's CFR could
weigh on JLR's ratings or outlook especially if there is evidence
that TML's weaker credit quality could result in a higher
financial pressure on JLR.

Moody's could consider upgrading JLR's ratings to Baa3 in case of
(1) evidence that the recent new model introductions (Discovery,
F-Pace, XEL, Range Rover Velar and E-PACE) remain a sustained
success and positively contribute to JLR's diversification of
profit and cash flow generation; (2) visibility that JLR's
profitability will return to an adjusted EBITA margin well above
7.0%; (3) achieve a Moody's-adjusted leverage ratio below 2.0x or
lower; (4) its ability to generate positive free cash flows
despite the high investment spending as anticipated for the
coming years.

Headquartered in Coventry, UK JLR is a UK manufacturer of premium
passenger cars and all-terrain vehicles under the Jaguar and Land
Rover brands. JLR operates six sites in the UK and generates its
volumes in Europe including UK (44% of unit sales in the
financial year ended 31 March 2017, FY2017), North America (20%),
China (21%) and other markets (15%). In FY2017, JLR sold 604.0k
units (retail volumes, FY2016: 521.6k) with the vast majority
attributable to Land Rover (i.e., 70%) and generated revenues of
GBP24.3 billion (FY2016: GBP22.3 billion).

The principal methodology used in these ratings was Automobile
Manufacturer Industry published in June 2017.


SPIRIT ISSUER: S&P Affirms BB+(sf) Ratings on Six Note Classes
--------------------------------------------------------------
S&P Global Ratings has affirmed its credit ratings on the notes
issued by Spirit Issuer PLC (Spirit Issuer). S&P has also removed
its stable outlook on the ratings on the notes.

S&P said, "We have removed our stable outlook on the ratings to
reflect our view that outlooks, which are generally assigned,
where appropriate, to corporate and government entities and some
structured finance ratings, are no longer appropriate for our
ratings on the notes issued by Spirit Issuer, given that our
ratings approach assumes that we can rate through the insolvency
of the borrower."

Spirit Issuer is a corporate securitization backed by operating
cash flows generated by the borrowers, Spirit Pub Company
(Leased) Ltd. and Spirit Pub Company (Managed) Ltd., (Spirit Pub,
collectively), which is the primary source of repayment for an
underlying issuer-borrower secured loan. Spirit Pub operates an
estate of tenanted and managed pubs. The original transaction
closed in November 2004, and was tapped in November 2013.

S&P said, "Upon publishing our revised criteria for rating
corporate securitizations, we placed those ratings that could be
affected under criteria observation. Following our review of this
transaction, the ratings are no longer under criteria
observation."

BUSINESS RISK PROFILE AND RECENT PERFORMANCE

S&P said, "We have applied our corporate securitization criteria
as part of our rating analysis on the notes in this transaction.
As part of our analysis, we assess whether the operating cash
flows generated by the borrower are sufficient to make the
payments required under the notes' loan agreements by using a
debt service coverage ratio (DSCR) analysis under a base case and
a downside scenario. Our view of the borrowing group's potential
to generate cash flows is informed by our base-case operating
cash flow projection and our assessment of its business risk
profile, which is derived using our corporate methodology.

The public house (pub) sector accounts for a quarter of the GBP88
billion eating and drinking out market in the U.K. With the long-
term trend of slowly declining alcohol consumption, pub operators
have been adjusting their portfolio through regular pub
disposals. This is evidenced by the estimated 47,000 pubs and
bars competing in the segment today compared to a crowded 57,500
in 2007. This represents an average annual decline of almost 2%.
The major pub operators are Greene King PLC, Mitchells & Butlers,
Ei (previously known as Enterprise Inns), and Punch Taverns.

As of April 2017, Spirit Issuer comprised 1,011 pubs which
represent over one-third of the total 2,924 pubs under Green King
PLC, which is the largest pub operator in the U.K. by EBITDA.
Spirit Issuer generated GBP709 million in revenues and GBP158
million reported EBITDA for the financial year (FY) ended April
2017. This is relatively smaller than the counterpart Greene King
securitization under the same group, which generated GBP815
million revenue and GBP234 million reported EBITDA. S&P also
recognize that Spirit Issuer includes branded pubs such as Chef &
Brewer, Flaming Grill, Taylor Walker, and Fayre & Square.

Spirit Pub is larger than its peers with fair business risk
profiles; it has only GBP204.2 million in adjusted EBITDA within
the securitized estate, compared to GBP114.6 million for
Marston's Pub and GBP136.0 million for Unique Pub Properties.
Additionally, Spirit Pub has a higher proportion of tenanted
pubs, leading to lower overall EBITDA per pub as compared to its
peers.

OPERATING PERFORMANCE UPDATE

Unlike the Greene King securitization, 61% of Spirit Issuer's
securitization pubs and 77% of its EBITDA are attributed to the
managed segment given the relatively higher revenue and EBITDA
base. The remaining 23% of the securitization's EBITDA is derived
from the tenanted segment. While the leased and tenanted pub
segment is subject to the market-rent-only option under the
Statutory Pub Code, S&P sees a limited impact on the pub sector
as we think pub operators would attempt to compensate for a loss
in drinks and food sales with an increase in rental income.

Nevertheless, the securitization also has no geographic
diversification outside the U.K. S&P said, "We expect that the
rising National Living Wage and increasing drinks and food costs
due to the weak British pound sterling could weigh on the EBITDA
margin, particularly on the managed pub segment, which has direct
exposure to cost inflation. In addition, this could indirectly
affect the profitability of leased and tenanted pubs if publicans
struggle to pass on the cost increases to consumers, bringing
about the risk of higher business failure rates. These factors
support our assessment of the business risk profile as fair,
which is unchanged."

EVOLUTION OF THE CAPITAL STRUCTURE

The class A3 notes were fully and voluntarily redeemed in June
2017, following which the commitment for the issuer's liquidity
facility was GBP115.15 million.

After the irrevocable redemption notices served on Nov. 30, 2017,
S&P expects that the class A1, A6, and A7 notes will be fully
redeemed and the interest rate swaps hedging these notes will be
terminated on Dec. 28, 2017. Any swap termination costs that will
be made on the day of termination will be covered under the
sources and uses given below.

The source of funds for the redemptions will come from the sale
of pubs from Spirit Pub Company (Managed) Ltd. to Greene King,
which sits outside the whole business securitization.

S&P said, "We have received irrevocable notices for both
redemption of the notes and the prepayment of the associated
issuer/borrower loans, which specify that the cash in the
disposal proceeds account may only be used for the prepayments.
In our view, the class A1, A6, and A7 notes are now fully cash
collateralized.  As a result, our cash flow analysis reflects the
capital structure after the planned redemptions below.  Following
the redemptions, the commitment for the issuer's liquidity
facility will be reduced to GBP85.79 million, which is also
reflected in our analysis."

RATING RATIONALE

Spirit Issuer's primary sources of funds for principal and
interest payments on the outstanding notes are the loan interest
and principal payments from the borrower, which are ultimately
backed by future cash flows generated by the operating assets.

S&P's ratings address the timely payment of interest, excluding
any subordinated step-up coupons, and principal due on the notes.

DSCR ANALYSIS

S&P said, "Our cash flow analysis serves to both assess whether
cash flows will be sufficient to service debt through the
transaction's life and to project minimum DSCRs in base-case and
downside scenarios.
Base-case scenario

"Our base-case EBITDA and operating cash flow projections for
FY2018 and the company's fair business risk profile rely on our
corporate methodology. We expect both metrics to grow through the
end of FY2018. We have further reduced our forecast to reflect
the disposal of 104 managed pubs in December 2017 based on
guidance we received from Greene King on the EBITDA contribution.
Beyond FY2018, our base-case projections are based on our "Global
Methodology And Assumptions For Corporate Securitizations," from
which we then apply assumptions for capital expenditures (capex)
and taxes to arrive at our projections for the cash flow
available for debt service." For Spirit Pub, S&P's assumptions
include:

-- Maintenance capex (net of expensed amounts): GBP30.9 million
    for FY2018, reducing to GBP23.9 million thereafter, which is
    in line with transaction documents' minimum requirements.

-- Development capex: GBP0.6 million for FY2018. Thereafter, as
    S&P assumes no growth and in line with our corporate
    securitization criteria, it considers no investment capex.

-- Tax: Due to the tax shield created by the debt service at
    Spirit Pub, we do not assume any taxes will be due.

S&P established an anchor of 'bb-' for the class A notes based
on:

-- Its assessment of Spirit Pub's fair business risk profile,
    which we associate with a business volatility score of '4';
    and

-- The minimum DSCR achieved in its base-case analysis, which
    considers only operating-level cash flows but does not give
    credit to issuer-level structural features (such as the
    tranched liquidity facility). The notes are fully amortizing.

Downside Scenario

S&P said, "Our downside DSCR analysis tests whether the issuer-
level structural enhancements improve the transaction's
resilience under a stress scenario. Spirit Pub falls within the
pubs, restaurants, and retail industry. Considering U.K. pubs'
historical performance during the financial crisis, in our view,
25% and 15% declines in EBITDA from our base case are appropriate
for the tenanted and managed pub subsectors, respectively.

"Our downside DSCR analysis resulted in a strong resilience score
for the class A notes."

The combination of a strong resilience score and the 'bb-' anchor
derived in the base-case results in a resilience-adjusted anchor
of 'bb+' for the class A notes.

Lastly, the issuer's GBP85.79 million liquidity facility balance
represents a significant level of liquidity support, measured as
a percentage of the current outstanding balance of the class A
notes. Given that the full two notches above the anchor have been
achieved, S&P considers a one-notch increase to their resilience-
adjusted anchor warranted.

Modifiers Analysis

S&P modifiers analysis did not lead to any specific adjustment.

Comparable Rating Analysis

S&P said, "We view it as highly likely that the borrower will
continue to sell pubs to Greene King as part of a broader
strategy to consolidate the Greene King Retail and Spirit Pub
estates and simplify their management and reporting structures.
Although we expect that it will continue to redeem outstanding
notes with the disposal proceeds, the velocity of the disposals,
the multiple of EBITDA realized for the disposed pubs, and costs
(e.g., swap break costs) present uncertainties. We assessed a
one-notch downward adjustment to the potential rating."

OUTLOOK

S&P said, "A change in our assessment of the company's business
risk profile would likely lead to a rating action on the notes.
We would require higher or lower DSCRs for a weaker or stronger
business risk profile to achieve the same anchors."

UPSIDE SCENARIO

S&P said, "We do not currently see a scenario that would lead us
to raising our assessment of Spirit Pub's business risk profile.

"We may consider raising our ratings on the notes if our minimum
projected DSCR goes above 1.3:1 for the class A notes in our
base-case scenario."

DOWNSIDE SCENARIO

S&P said, "We could lower our ratings on the notes if we lowered
the business risk profile to weak from fair. This could occur if
cost headwinds result in a sharp decline in reported EBITDA or
the EBITDA margin, or a reduction in the scale of the securitized
estate, potentially due to an accelerated disposal program.

"We may also consider lowering our ratings on the notes if our
minimum projected DSCRs fall below 1.2:1 for the class A notes in
our base-case scenario."

SURVEILLANCE

S&P said, "We currently do not expect bond cash flow disruptions
or rating implications from the potential phase out of LIBOR and
similar IBOR benchmarks after 2021. However, as new proposed
benchmarks emerge, we will need to consider whether they meet our
criteria."

RATINGS LIST

  Spirit Issuer PLC
  GBP1.41 Billion Fixed- and Floating-Rate Asset-Backed Debenture
  Bonds

  Class          Rating

  Ratings Affirmed

  A1             BB+ (sf)
  A2             BB+ (sf)
  A4             BB+ (sf)
  A5             BB+ (sf)
  A6             BB+ (sf)
  A7             BB+ (sf)



                            *********

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-
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Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
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Editors.

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