---

        T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Tuesday, May 8, 2018, Vol. 19, No. 090


                            Headlines


F R A N C E

PICARD GROUPE: S&P Cuts Issuer Credit Rating to B, Outlook Stable


G E R M A N Y

SPRINGER SBM: Moody's Places B2 CFR on Review for Upgrade
SPRINGER SBM: S&P Places 'B' Issuer Credit Rating on Watch Pos.


G R E E C E

GREECE: Biggest Banks Survive Stress Test's Adverse Scenario


I R E L A N D

DENIS MORIARTY: Secures New Investment, Exits Examinership
PENTA CLO 4: Moody's Assigns Ba2 Rating to Class E Notes
PENTA CLO 4: Fitch Assigns 'B-(EXP)' Rating to Class F Notes


I T A L Y

NEXI SPA: S&P Places 'BB-' ICR on Watch Developing on Carve-Out


N E T H E R L A N D S

AVAST HOLDING: Moody's Alters Outlook to Stable, Affirms Ba3 CFR
CNH INDUSTRIAL: Moody's Affirms Ba1 Corporate Family Rating


N O R W A Y

B2HOLDING ASA: S&P Assigns 'BB-' Issuer Credit Rating
NORSKE SKOG: Oceanwood Agrees to Buy Business for EUR235MM


R U S S I A

ASIAN-PACIFIC: Fitch Alters 'CCC' LT IDR Watch to Positive
IBA-MOSCOW: Moody's Withdraws B3 Long-Term Deposit Ratings
STAVROPOL REGION: Fitch Affirms 'BB' IDRs, Alters Outlook to Pos.
SVERDLOVSK REGION: Fitch Affirms IDRs at BB+, Outlook Stable


S P A I N

AYT KUTXA HIPOTECARIO I: S&P Affirms BB+ Rating on Cl. C Notes
AYT KUTXA HIPOTECARIO II: S&P Affirms CCC+(sf) Rating on C Notes
GC PASTOR 5: S&P Raises A2 Notes Rating to B+(sf), Off Watch Pos.
IM BCC: Moody's Assigns Caa2 Rating to EUR240M Serie B Notes


U K R A I N E

UKRAINE: Fitch Affirms Foreign-Currency IDR at B-, Outlook Stable


U N I T E D   K I N G D O M

HOUSE OF FRASER: Landlords Brace for Rent Negotiation
PI UK HOLDCO: S&P Affirms 'B' Long-Term Issuer Credit Rating
SAMMON CONTRACTING: PJ McGrath Proposes to Invest EUR2.2MM
SBOLT 2018-1: Moody's Assigns (P)Ba2 Rating to Class D Notes


                            *********



===========
F R A N C E
===========


PICARD GROUPE: S&P Cuts Issuer Credit Rating to B, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings lowered to 'B' from 'B+' its long-term issuer
credit rating on French frozen food retailer Picard Groupe S.A.S.
The outlook is stable.

S&P said, "In addition, we lowered to 'B' from 'B+' our issue
rating on the group's EUR1.19 billion senior secured notes due
2023 issued by Picard Groupe S.A.S. The recovery rating on these
notes remains at '4', indicating our expectation of 45% recovery
in the event of a payment default. We also lowered to 'CCC+' from
'B-' our issue rating on the EUR310 million senior unsecured
notes due 2024 issued by Picard Bondco S.A. The recovery rating
on these notes remains at '6', indicating our expectation of zero
recovery in the event of a payment default.

"At the same time, we assigned a 'B' issue rating to the proposed
EUR60 million senior secured mirror notes due 2023 to be issued
by Picard Groupe S.A.S. The recovery rating on these notes is
'4', indicating our expectation of 45% recovery in the event of a
payment default."

The ratings on the proposed instruments are subject to the
successful completion of the transaction, including receipt of
the final documentation. If the refinancing transaction does not
complete or the scope of the transaction departs materially from
the current plan, S&P reserves the right to withdraw or revise
its ratings.

The downgrade primarily reflects the group's recent announcement
that it will issue EUR60 million of senior secured floating-rate
notes and use some of the cash on its balance sheet to fund a
dividend payment of EUR78 million. This second debt-funded
dividend distribution will result in adjusted debt to EBITDA
remaining around 7x in fiscal 2019 (year ending March 31, 2019),
compared with S&P's previous base case of modest deleveraging to
6.6x. More importantly, in S&P's view this signals a less
supportive financial policy.

The debt-funded dividend distribution comes after the group's
December 2017 refinancing of its capital structure, whereby the
group issued EUR1.19 billion of floating-rate senior secured
notes and EUR310 million of fixed-rate unsecured notes, replacing
its EUR1.2 billion senior notes and EUR222 million payment-in-
kind notes, while also allowing for a EUR110 million dividend
distribution. This transaction resulted in higher cash pay
leverage, signaling a less supportive financial policy from the
current shareholders.

S&P said, "Although the second dividend payment is more moderate
than the first, in our base case forecast it will result in a
second consecutive year of negative discretionary cash flow. In
our view, this does not signal a commitment to deleveraging the
business, which was our previous expectation. While we understand
this second dividend was already envisioned in the December 2017
transaction and was permitted under the existing documentation,
we had not incorporated it in our previous base case as a likely
scenario.  Picard's proposed EUR60 million issuance will increase
total adjusted debt to EUR1.8 billion in fiscal 2019, with over
EUR1.5 billion of financial cash pay debt, a sizable amount,
given the group's limited operating scale.

"Our view of the group's financial risk is also constrained by
our assessment of the shareholder's financial policy. Private
equity sponsor Lion Capital has been a shareholder since 2010,
and in 2015 disposed of a 49% stake to Aryzta, which has publicly
mentioned that it may consider disposing of its stake in the near
future. As a result, we have limited visibility over the
financial policy in the short term. That said, we believe an
additional dividend distribution is unlikely in the near future,
given the terms of the documentation, while an eventual change of
control would not necessarily entail a refinancing, since the
current bonds are portable, to the extent consolidated net
leverage is less than 7.2x prior to June 15, 2019, and less than
6.9x thereafter.

"In our view, Picard has demonstrated a resilient operating
performance and niche positioning, which offsets its small size
and lack of geographic diversity compared with some of its larger
competitors in France. The group's high quality food offering at
affordable prices has built strong brand recognition, translating
into high margins and reported free cash flow relative to its
peers. Picard continues to gradually improve its market share to
about 19.6% as of year-end 2018 and is the leading frozen food
retailer in France, with 996 stores across the country. While the
group is subject to some seasonality in revenues and is
potentially vulnerable to food safety and supply chain issues, we
believe management has a strong record of operating performance.
The group's business model is also cash flow supportive, with
moderate capital expenditure (capex; about 3% of sales) and
structurally negative working capital requirements.

"The stable outlook reflects our view that, despite continued
competition in the French grocery market, Picard will defend its
niche market position and achieve revenue growth of roughly 3%
over the coming 12 months, thanks to new store openings and
continued like-for-like growth, while maintaining an operating
margin at the current level of about 18%. We anticipate FOCF of
about EUR50 million in fiscal 2019, while discretionary cash flow
will remain negative for the second consecutive year. We forecast
adjusted debt to EBITDA of about 7x for fiscal 2019 and a ratio
of EBITDAR to cash interest plus rent of around 2.1x over the
next 12 months.

"We could raise the ratings if, on the back of continued strong
FOCF, at least neutral discretionary cash flow, and adequate
liquidity, Picard deleveraged, such that its adjusted debt to
EBITDA improved sustainably to below 6.0x. An upgrade would also
be contingent on management and shareholders demonstrating a
commitment to a more conservative financial policy.

"We could lower the ratings if Picard's growth is lower than we
anticipate, or if its operating performance deteriorates, leading
to EBITDAR cash interest coverage weakening toward 1.8x, or if
discretionary cash flow is significantly more negative than
anticipated, resulting in adjusted debt to EBITDA higher than
7.5x. This could result from an economic downturn in France,
intensified price competition in the French grocery market, a
food safety scare damaging Picard's brand reputation, a supply
chain disruption, or an inability to pass on food inflation to
customers."


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


SPRINGER SBM: Moody's Places B2 CFR on Review for Upgrade
---------------------------------------------------------
Moody's Investors Service has placed on review for upgrade the B2
corporate family rating (CFR) and B2-PD probability of default
ratings (PDR) of Springer SBM One GmbH ("Springer Nature"). The
B2 ratings on the senior secured facilities at both Springer
Science+Business Media Deutschland and Springer Science+Business
Media GmbH are unaffected by the review; the existing debt
instruments are expected to be refinanced with new facilities.
The rating action follows the announcement that the company had
filed the prospectus for the public offering of up to 145 million
shares on the Frankfurt stock exchange.

"We are placing Springer Nature's ratings on review for upgrade
because the company plans to repay some of its outstanding debt
with proceeds from the IPO," says Christian Azzi, a Moody's
Assistant Vice President and lead analyst for Springer Nature.
"The company's Moody's adjusted debt/EBITDA could decline to
around 4x, pro-forma for the IPO and debt repayment, from 5.5x in
2017, which could result in ratings being upgraded up to two
notches above the current B2," adds Mr Azzi.

RATINGS RATIONALE

The rating review was prompted by Springer Nature's plans to
raise around EUR1.2 billion from the Springer Nature AG & Co.
KGaA IPO as outlined in the prospectus filed on 25 April 2018.
The company's announced plans are for c.EUR1 billion of the net
proceeds from this IPO to be used to reduce outstanding
indebtedness from EUR3.01 billion to EUR2.01 billion translating
to a Moody's adjusted leverage of around 4x post IPO for 2017 (or
3.5x on a company's reported net leverage basis).

As part of the IPO announcement, the company also stated that it
will repay the remainder of the outstanding amounts under the
facilities through a new senior credit agreement it had entered
into on 12 April 2018. As a result, Moody's expects that it will
withdraw the ratings on Springer Nature's existing debt
instruments once they are repaid.

In addition to the immediate expected decline in leverage,
Moody's review will evaluate the long-term financial policy of
Springer Nature, including any publicly stated updated leverage
target, in light of the post-IPO stated dividend policy of a
payout of 50% the company's annual adjusted net profit. The
review will also focus on an evaluation of the ongoing operating
trends, and medium-term revenue growth potential.

At this stage, an upgrade of the CFR by up to two notches is
possible, as a result of the expected immediate reduction in
leverage and depending on Moody's assessment of Springer's medium
term performance.

WHAT COULD CHANGE THE RATING UP/DOWN

Prior to placing the ratings on review, Moody's stated that
upward pressure could be exerted on the rating if Springer Nature
(1) fully realizes its synergies such that it achieves sustained
revenue growth in mid-single-digit percentage terms; (2) reduces
its leverage to below 5.0x the ratio of gross debt to EBITDA (as
adjusted by Moody's) on a sustainable basis; and (3) generates
improved free cash flow (as adjusted by Moody's after capital
expenditure and dividends) on a sustainable basis.

Prior to placing the ratings on review, Moody's stated that
downward pressure could be exerted on Springer Nature's B2 CFR
should (1) the company's leverage remain sustainably above 6.0x
the ratio of gross debt to EBITDA (as adjusted by Moody's); (2) a
material deterioration occur in its operating performance; (3)
the company generate weak free cash flows on a sustainable basis;
and/or (4) any factors that can have a negative impact on the
company's liquidity emerge.

LIST OF AFFECTED RATINGS

Placed On Review for Upgrade:

Issuer: Springer SBM One GmbH

Corporate Family Rating, Placed on Review for Upgrade, currently
B2

Probability of Default Rating, Placed on Review for Upgrade,
currently B2-PD

Outlook Actions:

Issuer: Springer SBM One GmbH

Outlook, Changed To Rating Under Review From Stable

PRINCIPAL METHODOLOGY

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

COMPANY PROFILE

Headquartered in Berlin, Springer Nature is a leading global
research, educational and professional publisher formed in May
2015 as a result of the merger of Springer Science+Business Media
(owned by funds advised by BC Partners) and the majority of
Holtzbrinck-owned MSE, namely Nature Publishing Group, Palgrave
Macmillan and the global businesses of Macmillan Education. The
company is 53% owned by Holtzbrinck, a leading well-established
global media business, and 47% by funds advised by BC Partners.
In 2017, the company reported revenue of EUR1.64 billion and
EBITDA of EUR521 million.


SPRINGER SBM: S&P Places 'B' Issuer Credit Rating on Watch Pos.
--------------------------------------------------------------
S&P Global Ratings placed its 'B' long-term issuer credit rating
on Germany-based publisher Springer SBM One GmbH (Springer) on
CreditWatch with positive implications.

S&P said, "At the same time, we affirmed our 'B' issue ratings on
Springer's senior credit facilities. The recovery rating on the
facilities is unchanged at '3', reflecting our expectation of
meaningful recovery (50%-70%; rounded estimate 65%) in the event
of a default."

The positive CreditWatch placement follows the announcement that
Springer's parent, Springer Nature AG & Co. KGaA, is planning an
IPO on the Frankfurt Stock Exchange. The CreditWatch placement
reflects the possibility that we could raise the long-term issuer
credit rating on Springer after the successful completion of the
IPO. Springer intends to use the proceeds from the primary
issuance to repay debt, and has signed a new credit facility
agreement to refinance its existing facilities. S&P's assessment
after the completion of the IPO is contingent on its analysis of
the revised final capital structure, financial policies, and
financial sponsor ownership.

Springer, which reported revenues of EUR1.64 billion in 2017,
plans to raise about EUR1.2 billion in gross primary proceeds
from the IPO issuance, which it will use to reduce outstanding
debt. S&P said, "We also note that total issuance of up to about
EUR1.6 billion is possible, if funds advised by BC Partners
exercise their upsize option through a secondary offering as well
as an overallotment. Ultimately, we anticipate a more
conservative leverage profile post IPO."

Springer intends to use the primary proceeds to reduce the net
leverage ratio to approximately 3.5x its 2017 company-adjusted
EBITDA. S&P said, "We estimate that this is equivalent to S&P
Global Ratings-adjusted leverage of less than 5x. This leverage
could result in an improved assessment of the group's financial
profile. However, we await further clarity on the final capital
structure, financial policy, and financial sponsor ownership post
IPO."

In light of the continued financial sponsor ownership interest, a
positive rating action depends on Springer's and the sponsors'
ability and willingness to maintain adjusted debt to EBITDA below
5x on a sustainable basis after the IPO. Financial policy
considerations--including leverage tolerance, appetite for
acquisitions, capital expenditure (capex), and dividend policy--
will be key rating drivers under the new capital structure.

S&P said, "We expect to resolve the CreditWatch placement after
Springer completes the IPO and refinances its existing debt
facilities. We would consider raising the long-term issuer rating
on Springer if the IPO is successful and the group deleverages,
with adjusted debt to EBITDA declining to 5x or below on a
sustainable basis." An upgrade is also contingent on the group's
updated financial policy post the IPO, including the leverage
target and financial sponsor ownership.


===========
G R E E C E
===========


GREECE: Biggest Banks Survive Stress Test's Adverse Scenario
------------------------------------------------------------
Marcus Bensasson, Christos Ziotis and Paul Tugwell at Bloomberg
News report that Greece's biggest banks emerged unscathed after a
stress test, giving European policy makers one less worry as they
plan for the end of the nation's latest bailout in August.

According to Bloomberg, the European Central Bank said on May 5,
Piraeus Bank, National Bank of Greece, Alpha Bank and Eurobank
Ergasias survived the test's adverse scenario, which pitted them
against a fresh recession and a collapse in real-estate prices.
The results mean almost EUR20 billion (US$24 billion) of funds
set aside to shore up the lenders is now free for other purposes,
Bloomberg notes.

Piraeus Bank, Greece's largest bank, came through the stress
test's adverse scenario with a common equity Tier 1 capital ratio
of 5.9%, above the EU's legal minimum of 4.5%, Bloomberg relates.
The other big lenders also kept their CET1 levels above water,
Bloomberg states.

Greek banks were hit hard as the country lost a quarter of its
economic output in a crisis and underwent the world's biggest
sovereign-debt restructuring in 2012, Bloomberg recounts.

Talks between Greece and its international creditors are focused
on post-bailout monitoring arrangements and possible measures to
lighten the country's crushing debt load, Bloomberg states.
Ideas that have been floated include using funds left over from
the EUR86 billion package agreed in 2015 to buy debt held by the
ECB or the International Monetary Fund, according to Bloomberg.

Crucial to reaching a debt deal will be whether the IMF, which
has takes a hawkish stance on Greek banks' capital needs, factors
the stress-test results into its debt-sustainability analysis,
Bloomberg says.  The IMF previously assumed that the lenders
would need an additional EUR10 billion, Bloomberg relays.


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


DENIS MORIARTY: Secures New Investment, Exits Examinership
----------------------------------------------------------
Tom Lyons and Ian Guider at The Business Post report that
Kerry-based civil engineering and construction services companies
Denis Moriarty the Kerries Ltd (DMTKL) and Moriarty Civil
Engineering Ltd (MCEL) have emerged from examinership after
securing new investment.


PENTA CLO 4: Moody's Assigns Ba2 Rating to Class E Notes
--------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following provisional ratings to notes to be issued by Penta CLO
4 Designated Activity Company:

EUR2,500,000 Class X Senior Secured Floating Rate Notes due 2030,
Assigned (P)Aaa (sf)

EUR236,000,000 Class A Senior Secured Floating Rate Notes due
2030, Assigned (P)Aaa (sf)

EUR38,000,000 Class B-1 Senior Secured Floating Rate Notes due
2030, Assigned (P)Aa2 (sf)

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

EUR30,050,000 Class C Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned (P)A2 (sf)

EUR20,550,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned (P)Baa2 (sf)

EUR27,100,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned (P)Ba2 (sf)

EUR10,450,000 Class F Senior Secured Deferrable Floating Rate
Notes due 2030, Assigned (P)B2 (sf)

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

RATINGS RATIONALE

Moody's provisional rating of the rated notes addresses the
expected loss posed to noteholders by the legal final maturity of
the notes in 2030. The provisional ratings reflect the risks due
to defaults on the underlying portfolio of loans given the
characteristics and eligibility criteria of the constituent
assets, the relevant portfolio tests and covenants as well as the
transaction's capital and legal structure. Furthermore, Moody's
is of the opinion that the collateral manager, Partners Group
(UK) Management Limited ("Partners Group"), has sufficient
experience and operational capacity and is capable of managing
this CLO.

Penta CLO 4 Designated Activity Company is a managed cash flow
CLO. At least 90% of the portfolio must consist of senior secured
loans and senior secured bonds and up to 10% of the portfolio may
consist of unsecured obligations, second-lien loans, mezzanine
loans and high yield bonds. The portfolio is expected to be
approximately at least 70% ramped up as of the closing date and
to be comprised predominantly of corporate loans to obligors
domiciled in Western Europe.

Partners Group will manage the CLO. It will direct the selection,
acquisition and disposition of collateral on behalf of the Issuer
and may engage in trading activity, including discretionary
trading, during the transaction's four-year reinvestment period.
Thereafter, purchases are permitted using principal proceeds from
unscheduled principal payments and proceeds from sales of credit
risk obligations, and are subject to certain restrictions.

In addition to the eight classes of notes rated by Moody's, the
Issuer will issue EUR38.55 million of subordinated notes, which
will not be rated.

The transaction incorporates interest and par coverage tests
which, if triggered, divert interest and principal proceeds to
pay down the notes in order of seniority.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in August 2017.

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

The rated notes' performance is subject to uncertainty. The
notes' performance is sensitive to the performance of the
underlying portfolio, which in turn depends on economic and
credit conditions that may change. Partners Group's investment
decisions and management of the transaction will also affect the
notes' performance.

Loss and Cash Flow Analysis:

Moody's modeled the transaction using CDOEdge, a cash flow model
based on the Binomial Expansion Technique, as described in
Section 2.3 of the "Moody's Global Approach to Rating
Collateralized Loan Obligations" rating methodology published in
August 2017. The cash flow model evaluates all default scenarios
that are then weighted considering the probabilities of the
binomial distribution assumed for the portfolio default rate. In
each default scenario, the corresponding loss for each class of
notes is calculated given the incoming cash flows from the assets
and the outgoing payments to third parties and noteholders.
Therefore, the expected loss or EL for each tranche is the sum
product of (i) the probability of occurrence of each default
scenario and (ii) the loss derived from the cash flow model in
each default scenario for each tranche. As such, Moody's
encompasses the assessment of stressed scenarios.

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

Par amount: EUR400,000,000

Diversity Score: 37

Weighted Average Rating Factor (WARF): 2800

Weighted Average Spread (WAS): 3.50%

Weighted Average Recovery Rate (WARR): 43.5%

Weighted Average Life (WAL): 8.5 years

Moody's has analysed the potential impact associated with
sovereign related risk of peripheral European countries. As part
of the base case, Moody's has addressed the potential exposure to
obligors domiciled in countries with local currency country risk
ceiling of A1 or below. Following the effective date, and given
the portfolio constraints, the reinvestment criteria and the
current sovereign ratings in Europe, such exposure may not exceed
10% of the total portfolio. As a result and in conjunction with
the current foreign government bond ratings of the eligible
countries, as a worst case scenario, a maximum 10% of the pool
would be domiciled in countries with A3. The remainder of the
pool will be domiciled in countries which currently have a local
or foreign currency country ceiling of Aaa or Aa1 to Aa3.

Stress Scenarios:

Together with the set of modeling assumptions above, Moody's
conducted additional sensitivity analysis, which was an important
component in determining the provisional rating assigned to the
rated notes. This sensitivity analysis includes increased default
probability relative to the base case. Here is a summary of the
impact of an increase in default probability (expressed in terms
of WARF level) on each of the rated notes (shown in terms of the
number of notch difference versus the current model output,
whereby a negative difference corresponds to higher expected
losses), holding all other factors equal:

Percentage Change in WARF: WARF + 15% (to 3220 from 2800)

Ratings Impact in Rating Notches:

Class X Senior Secured Floating Rate Notes: 0

Class A Senior Secured Floating Rate Notes: 0

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

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

Class C Senior Secured Deferrable Floating Rate Notes: -2

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -1

Class F Senior Secured Deferrable Floating Rate Notes: 0

Percentage Change in WARF: WARF +30% (to 3640 from 2800)

Ratings Impact in Rating Notches:

Class X Senior Secured Floating Rate Notes: 0

Class A Senior Secured Floating Rate Notes: -1

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

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

Class C Senior Secured Deferrable Floating Rate Notes: -4

Class D Senior Secured Deferrable Floating Rate Notes: -2

Class E Senior Secured Deferrable Floating Rate Notes: -2

Class F Senior Secured Deferrable Floating Rate Notes: -2


PENTA CLO 4: Fitch Assigns 'B-(EXP)' Rating to Class F Notes
------------------------------------------------------------
Fitch Ratings has assigned Penta CLO 4 Designated Activity
Company expected ratings, as follows:

EUR2.5 million Class X: 'AAA(EXP)sf'; Outlook Stable
EUR236 million Class A: 'AAA(EXP)sf'; Outlook Stable
EUR38 million Class B-1: 'AA(EXP)sf'; Outlook Stable
EUR10 million Class B-2: 'AA(EXP)sf'; Outlook Stable
EUR30.05 million Class C: 'A(EXP)sf'; Outlook Stable
EUR20.55 million Class D: 'BBB(EXP)sf'; Outlook Stable
EUR27.1 million Class E: 'BB(EXP)sf'; Outlook Stable
EUR10.45 million Class F: 'B-(EXP)sf'; Outlook Stable
EUR38.55 million subordinated notes: not rated

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

Penta CLO 4 Designated Activity Company is a cash flow
collateralised loan obligation (CLO). Net proceeds from the
issuance of the notes will be used to purchase a portfolio of
EUR400 million of mostly European leveraged loans and bonds. The
portfolio is actively managed by Partners Group (UK) Management
Ltd. The CLO envisages a four-year reinvestment period and an
8.5-year weighted average life (WAL).

KEY RATING DRIVERS
'B' Portfolio Credit Quality
Fitch places the average credit quality of obligors in the 'B'
range. The Fitch-weighted average rating factor (WARF) of the
identified portfolio is 32.7, below the indicative maximum
covenant WARF for assigning expected ratings of 33.5.

High Recovery Expectations
At least 90% of the portfolio comprises senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch-weighted average recovery rate (WARR) of the
current portfolio is 66.2%, above the minimum covenant WARR for
assigning expected ratings of 62.1%.

Diversified Asset Portfolio
The covenanted maximum exposure to the top 10 obligors for
assigning the expected ratings is 20% of the portfolio balance.
The transaction also includes limits on maximum industry exposure
based on Fitch industry definitions. The maximum exposure to the
three largest (Fitch-defined) industries in the portfolio is
covenanted at 40%. These covenants ensure that the asset
portfolio will not be exposed to excessive concentration.

Portfolio Management
The transaction features a four-year reinvestment period and
includes reinvestment criteria similar to other European
transactions. Fitch analysis is based on a stressed-case
portfolio with the aim of testing the robustness of the
transaction structure against its covenants and portfolio
guidelines.

Cash Flow Analysis
Fitch used a customised proprietary cash flow model to replicate
the principal and interest waterfalls and the various structural
features of the transaction, and to assess their effectiveness,
including the structural protection provided by excess spread
diverted through the par value and interest coverage tests.

RATING SENSITIVITIES
A 125% default multiplier applied to the portfolio's mean default
rate, and with this increase added to all rating default levels,
would lead to a downgrade of up to two notches for the rated
notes. A 25% reduction in recovery rates would lead to a
downgrade of up to four notches for the rated notes.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY
The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other
Nationally Recognised Statistical Rating Organisations and/or
European Securities and Markets Authority-registered rating
agencies. Fitch has relied on the practices of the relevant
groups within Fitch and/or other rating agencies to assess the
asset portfolio information.

Overall, Fitch's assessment of the asset pool information relied
upon for the agency's rating analysis according to its applicable
rating methodologies indicates that it is adequately reliable.

SOURCES OF INFORMATION
The information was used in the analysis.
  -Loan-by-loan data provided by BNP Paribas as at April 18, 2018
  -Draft offering circular provided by BNP Paribas as at
   April 25, 2018

REPRESENTATIONS AND WARRANTIES
A description of the transaction's representations, warranties
and enforcement mechanisms (RW&Es) that are disclosed in the
offering document and which relate to the underlying asset pool
was not prepared for this transaction. Offering documents for
EMEA CLO transactions do not typically include RW&Es that are
available to investors and that relate to the asset pool
underlying the security. Therefore, Fitch credit reports for EMEA
CLO transactions will not typically include descriptions of
RW&Es.


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


NEXI SPA: S&P Places 'BB-' ICR on Watch Developing on Carve-Out
---------------------------------------------------------------
S&P Global Ratings placed its long-term issuer credit rating on
Italy-based Nexi SpA on CreditWatch with developing implications.
S&P also placed its 'BB-' long-term rating on its core
subsidiary, Nexi Cartasi, on CreditWatch negative.

S&P said, "At the same time, we revised to stable from negative
the outlook on nonoperating holding company (NOHC) Mercury Bond
Co. We also affirmed our 'B/B' long- and short-term ratings on
the NOHC and our 'B' long-term issue rating on its outstanding
payment-in-kind (PIK) toggle notes."

Mercury UK Holdco Ltd. has announced that it will reorganize the
group to separate its technological and digital payment
activities from those that require a specific banking license. As
a result of this transformation, S&P understands that Nexi SpA
will be carrying out banking transactions settlement activities
that require a banking license and some other banking activities,
such as acting as a depositary bank, while all its remaining
business will be operated by a separate, newly created entity.
The process will be completed in July.

As part of this reorganization, Mercury Bond Co. will reimburse
its EUR2.3 billion of PIK notes and will cease existing. Core
subsidiary Nexi Cartasi will become an electronic payment
institution and its activity will be transferred to the new
entity.

S&P said, "The CreditWatch placement for Nexi SpA reflects our
opinion that the reorganization is likely to significantly change
the business profile and financial profile of the existing
banking group from July 11, when the new entity comes into
operation.

"The current structure, on which our rating on Mercury Bond Co.
is based, will no longer exist from July 1. As such, we are
affirming the ratings on Mercury Bond Co. and revising the
outlook to stable as we do not expect the rating to change before
the company reimburses its EUR2.3 billion PIK toggle notes and
ceases to exist in two months' time.

"We placed Nexi SpA on CreditWatch developing to indicate that we
could affirm, raise, or lower the ratings after we review the new
structure and its impact on the company's business and financial
risk profile. We expect to resolve the CreditWatch placement in
the coming months, after meeting with the management team.

"We placed Nexi Cartasi on CreditWatch negative to indicate that
we could lower the long-term rating if we consider that the
company has become a core subsidiary of a lower rated institution
following the carve-out.

"The stable outlook on Mercury Bond Co. indicates that we expect
it to reimburse its EUR2.3 billion PIK notes on July 1 and then
to cease to exist. Therefore, a negative action on Mercury looks
very unlikely at this stage.

"We could lower the ratings if we do not expect the carve-out and
refinancing to go through as announced and we anticipate that the
group's business and financial risk profiles will deteriorate.

"Similarly, we consider a positive action to be very remote at
this stage. We could upgrade Mercury if we do not expect the
carve-out and refinancing to go through as announced and we
anticipate the existing group's leverage to be materially
reduced."


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


AVAST HOLDING: Moody's Alters Outlook to Stable, Affirms Ba3 CFR
----------------------------------------------------------------
Moody's Investors Service has changed the outlook on all of the
ratings of Czech security software provider Avast Holding B.V.
and its rated subsidiaries to stable from negative following the
announcement of the price range for an initial public offering
(IPO) on the London Stock Exchange. Avast is aiming to raise at
least $200 million of primary proceeds which it would use
alongside cash on the balance sheet to reduce indebtedness.

Concurrently, Moody's has affirmed all ratings of Avast Holding
B.V. and its rated subsidiaries.

Moody's outlook stabilisation and rating affirmations reflect
primarily Moody's expectation that Avast's operating performance
will continue to be solid and that the company will deleverage
towards 3.5x, a level viewed as appropriate for the Ba3 category,
though with limited room for additional leverage. Avast's
deleveraging will be helped by its proposed IPO which would
reduce Moody's adjusted leverage to around 3.8x (compared to
around 3.0x net debt/adjusted cash EBITDA quoted by Avast).

RATINGS RATIONALE

RATIONALE FOR STABLE OUTLOOK AND RATINGS AFFIRMATION

"We have stabilised Avast's outlook because we believe the risks
of a downgrade have diminished on the back of recent solid
performance and our expectation that free cash flow will be used
for deleveraging in 2018. In addition, Avast's IPO-led
deleveraging will reduce Moody's adjusted gross debt/EBITDA
towards 3.5x by the end of 2018. This is back in line with the
guidance we had set at the time of the AVG acquisition in July
2016 and reverses the impact of the group's debt raises from
2017" says Frederic Duranson, a Moody's Assistant Vice President
and lead analyst for Avast. "However, the announced dividend
policy will lead to lower free cash flow/debt in 2019, when we
expect the first regular distribution to shareholders" Mr.
Duranson adds.

The rating agency estimates that Moody's-adjusted gross debt to
EBITDA will fall by 0.7x to approximately 3.8x as of December
2017, pro forma for the expected debt repayment resulting from
the IPO. The lower debt quantum and 25 basis points reduction in
the interest margin on the existing term loans already agreed by
lenders would also trigger an improvement in Avast's interest
cover, calculated as Moody's adjusted EBITDA-capex/interest
expense, to 5.0x in 2017.

Avast has reported that almost all cost saving measures initiated
after the acquisition of AVG had been executed by the end of
2017. Their effect will be fully felt in 2018, when they will
yield material cost savings within EBITDA. Nevertheless, Moody's
does not forecast significant growth in EBITDA for 2018 because
(1) Avast's cost base will step up by more than $5 million owing
to its new listed company status and (2) the group is making
significant investments to develop new products in Consumer
Direct and SMB, its corporate business. As a result, Avast's
EBITDA margin could experience temporary downward pressure. In
2018, Moody's forecasts that the group will not be able to match
2017's revenue growth of +5.8%, owing to (1) lower than expected
growth in Mobile, (2) no expected growth in SMB and (3) the run-
off of the Discontinued Business. The vast majority of the
revenue growth will continue to come from Consumer Direct. The
rating agency expects that Avast's adjusted leverage will
decrease to around 3.5x at the end of 2018, largely driven by
mandatory amortisation of the term loans and on the back of
generated free cash flow.

Moody's forecasts free cash flow (after interest) in the range of
$220-$240 million in 2018, including one-off costs related to the
IPO and remaining payments to achieve the cost synergies. As a
result, Moody's expects that FCF/debt will be at least 15% in
2018 (18% before one-off items). However, with regular dividend
payments scheduled to start in 2019, Avast's FCF will temporarily
fall to below $150 million in 2019 such that FCF/debt would not
exceed 10%.

Avast's Ba3 CFR is generally supported by (1) the group's large
and geographically diversified base of more than 435 million
users across desktop and mobile, (2) high Moody's adjusted EBITDA
margin of 53% in 2017 and strong free cash flow generation, (3) a
track record of revenue and EBITDA growth, and (4) large scale in
emerging growth areas such as mobile.

Conversely, Avast's CFR is constrained by (1) the group's
relatively small percentage of paid users (4% in desktop) and
current revenue concentration in consumer PC security software,
(2) the intense industry competition and inherent technology
risks in security software markets, (3) relatively low customer
switching costs and (4) limited room to accommodate additional
leverage at this rating level.

Moody's views Avast's liquidity profile as good. It will be
supported by a cash balance of approximately $41 million as of
December 2017 and pro-forma for the IPO, forecast FCF generation
in excess of $200 million in 2018 and full availability under the
$85 million revolving credit facility (RCF), whose maturity will
be extended to 2022. The credit facilities are covenant-lite,
with only a springing net first lien leverage covenant on the
RCF, to be tested only if it is drawn by $35 million or more.

WHAT COULD CHANGE THE RATING UP/DOWN

Positive ratings pressure could develop over time if Avast (1)
successfully continues to diversify its revenue and profit
streams, (2) maintains Moody's adjusted EBITDA margins well above
50%, (3) delivers below 2.5x and (4) pursues a conservative
financial policy with no debt-funded acquisitions.

Conversely, negative ratings pressure could materialise if (1)
Avast's paid user base declines on a continued basis, (2)
adjusted leverage remains sustainably above 3.75x, (3) FCF/debt
is consistently lower than 10% or (4) the liquidity profile
weakens.

LIST OF AFFECTED RATINGS

Affirmations:

Issuer: Avast Holding B.V.

Corporate Family Rating, Affirmed Ba3

Probability of Default Rating, Affirmed Ba3-PD

Issuer: Avast Software B.V.

Senior Secured Bank Credit Facility, Affirmed Ba3

Outlook Actions:

Issuer: Avast Holding B.V.

Outlook, Changed To Stable From Negative

Issuer: Avast Software B.V.

Outlook, Changed To Stable From Negative

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Software
Industry published in December 2015.

CORPORATE PROFILE

Avast Holding B.V. (Avast) was founded in 1988 in the Czech
Republic and has grown to become a global provider of security
software and related solutions primarily focused on the consumer
market (including mobile), with small business clients as well.
The company is one of the world's largest online service
companies in terms of installed user base, with more than 435
million users worldwide as of December 2017. For the last 12
months to December 2017, Avast reported adjusted revenue of $780
million and EBITDA of $420 million, including a full-year
contribution from Piriform, which it acquired in July 2017.

Avast is currently owned at 46% by its founders, 29% by funds
advised by CVC Capital Partners, 18% by management, board members
and employees, and 7% by Summit Partners.


CNH INDUSTRIAL: Moody's Affirms Ba1 Corporate Family Rating
-----------------------------------------------------------
Moody's Investors Service graded the senior unsecured ratings of
CNH Industrial N.V. (CNHI) and CNH Industrial Finance Europe S.A.
(CHNIF Europe) to Ba1 from Ba2, and the senior unsecured rating
of CNH Industrial Finance North America, Inc. (CNHIF NA) to
(P)Ba1 from (P)Ba2. Moody's also affirmed the Ba1 Corporate
Family Rating (CFR) of CNHI, the Ba1 senior unsecured rating of
CNH Industrial Capital LLC, and the SGL-3 Speculative Grade
Liquidity rating of CNHI. The outlook is changed to positive from
stable.

RATINGS RATIONALE

The upgrades of the senior unsecured debt of CNHI, CNHIF Europe
and CNHIF NA recognize the repayment of debt at CNHI's US
operating companies and the progress evident in strengthening the
capital structure. These factors reduce the structural
subordination of the CNHI, CHNIF Europe, and CNHIF NA debt.

The ratings reflect CNHI's No. 2 position in the global farm
equipment sector, the benefits from the oligopolistic structure
of the industry with only 4 major participants, and Moody's view
that the sector has likely bottomed out, although meaningful
growth is still unlikely this year. Nonetheless, consolidated
performance is handicapped by the weakness in its commercial
vehicle business and its construction equipment operations.
Addressing the drag posed by these two operations continues to be
a major challenge, in part because of the level of operating
integration across all business units.

The positive outlook reflects Moody's expectation that CNHI will
benefit with recovery of the high horsepor farm equipment market,
where its operating margin is consistent with other heavy
equipment makers, and that the credit profile will improve with
positive developments in commercial vehicles and construction
equipment. Options addressing the weakness in these two segments
could include an eventual separation of the operations.

CNHI's liquidity is adequate, weighed by the need to maintain
considerable liquidity for its finance company operations. Total
liquidity position is $12.5 billion which consists of $5.4
billion in cash and $7.1 billion in committed borrowing
facilities. This provides moderately adequate coverage for the
approximately $11.5 billion in debt maturing during the coming
twelve months. The majority of this debt represents maturities at
the company's captive finance operations which have a $26.8
billion managed portfolio of retail and wholesale receivables.

The ratings could be upgraded if CNHI demonstrates progress in
improving the longer-term returns in the commercial vehicle and
construction equipment sectors, while continuing to benefit from
its strong position in farm equipment. Metrics that could support
a higher rating include: EBITA margins that are on track to reach
approximately 7%, with close to 10% in the farm equipment
segment; EBITA/interest expense of 4.0x; and debt/EBITDA
remaining below 3.0x. The company should also make clear progress
in strengthening EBITA/average assets to a level approximating
7.5%, compared with the modest level of 4.7% for 2017. An
additional critical element in any potential upgrade of CNHI will
be the degree to which the company's cash and unused committed
credit facilities exceed all debt obligations that mature during
the subsequent twelve months.

The ratings could be downgraded if the commercial vehicle and
construction equipment units become a more significant drag on
performance, or if the company's liquidity position deteriorates.
Metrics that would contribute to a downgrade include: EBITA
margins that remain below 4%; EBITA/interest expense
approximating 2.5x; and debt/EBITDA above 3.5x.

The methodologies used in these ratings were Global Manufacturing
Companies published in June 2017, Captive Finance Subsidiaries of
Nonfinancial Corporations published in December 2015 and Finance
Companies published in December 2016.

CNHI is leading manufacturer of agricultural equipment,
construction equipment and commercial vehicles. CNHI's fiscal
year 2017 industrial revenues were $26.2 billion, with $1.5
billion in operating profit.

The following summarizes Moody's rating action:

Upgrades:

Issuer: CNH Industrial N.V.

Senior Unsecured Medium-Term Note Program, Upgraded to (P)Ba1
from (P)Ba2

Senior Unsecured Regular Bond/Debenture, Upgraded to Ba1 (LGD4)
from Ba2 (LGD5)

Issuer: CNH Industrial Finance Europe S.A.

Senior Unsecured Medium-Term Note Program, Upgraded to (P)Ba1
from (P)Ba2

Senior Unsecured Regular Bond/Debenture, Upgraded to Ba1 (LGD4)
from Ba2 (LGD5)

Issuer: CNH Industrial Finance North America, Inc.

Senior Unsecured Medium-Term Note Program, Upgraded to (P)Ba1
from (P)Ba2

Affirmations:

Issuer: CNH Industrial N.V.

Probability of Default Rating, Affirmed Ba1-PD

Speculative Grade Liquidity Rating, Affirmed SGL-3

Corporate Family Rating, Affirmed Ba1

Issuer: CNH Industrial Capital LLC

Senior Unsecured Regular Bond/Debenture, Affirmed Ba1

Senior Unsecured Shelf, Affirmed (P)Ba1

Issuer: CNH Industrial Finance Europe S.A.

Short-Term Senior Unsecured Medium-Term Note Program, Affirmed
(P)NP

Issuer: CNH Industrial Finance North America, Inc.

Short-Term Senior Unsecured Medium-Term Note Program, Affirmed
(P)NP

Outlook Actions:

Issuer: CNH Industrial Capital LLC

Outlook, Changed To Positive From Stable

Issuer: CNH Industrial Finance Europe S.A.

Outlook, Changed To Positive From Stable

Issuer: CNH Industrial Finance North America, Inc.

Outlook, Changed To Positive From Stable

Issuer: CNH Industrial N.V.

Outlook, Changed To Positive From Stable


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


B2HOLDING ASA: S&P Assigns 'BB-' Issuer Credit Rating
-----------------------------------------------------
S&P Global Ratings assigned its 'BB-' long-term issuer credit
rating to Norway-based pan-European debt purchaser B2Holding ASA.
The outlook is stable.

The rating on B2Holding is constrained by the group's narrow
focus on purchasing and maximizing collections on distressed debt
portfolios, modest scale relative to certain peers, and its high
growth target in the context of its relatively short operating
history. Similar to many financial services firms, S&P also
thinks that B2Holding is exposed to material regulatory and
operational risks. These weaknesses are mitigated by B2Holding's
operational presence in 22 European countries, good market
positions in some of these markets, and its listed status that
supports long-term financial discipline.

Founded in 2011 and domiciled in Norway, B2Holding has quickly
become a well-established pan-European debt purchaser. It has
expanded through a combination of organic growth and a number of
bolt-on acquisitions. B2Holding is the parent company of a large
group of local subsidiaries. Its decentralized management model
means that local franchises are usually run under domestic brands
with local management teams. However, the group centralizes
certain functions, including its investment office in Luxembourg,
which supports operational consistency. As of Dec. 31, 2017,
B2Holding had Norwegian krone (NOK) 15 billion (EUR1.6 billion)
in 120-month estimated remaining collections (what the group
estimates it will collect over the given time frame if it did not
purchase any additional debt portfolios), and NOK1.8 billion
(EUR190 million) in cash EBITDA.

S&P said, "Similar to many of its rated peers, including Arrow
Global Group PLC, AnaCap Financial Europe S.A., Cabot Financial
Ltd., and Promontoria MCS SAS, we believe that B2Holding's
business model is susceptible to the debt-portfolio selling
behaviors of financial services companies and aggressive actions
by its competitors. Although not part of our base-case scenario,
this has the potential to lead to volume declines or heightened
market risk through uneconomical pricing of debt portfolios. Some
peers, such as Intrum Justitia AB (publ) or Garfunkelux Holdco 2
S.A. (the parent company of Lowell), have partially reduced their
vulnerability to this potential volatility by focusing on the
provision of long-term credit management services for third
parties. At year-end 2017, other operating revenues represented
13% of B2Holding's total revenues, which is low in comparison to
30%-50% for certain peers. Alongside B2Holding's high growth
strategy, we believe its earnings concentration constrains its
creditworthiness over our 12-month outlook horizon.

"Positively, B2Holding's diversification across 22 European
countries reduces its vulnerability to single country stress
events. Although the majority of the group's earnings come from a
limited number of key markets, we expect this concentration to
moderate as the group continues to grow, mainly in Eastern and
Southern Europe. We also expect that secured debt portfolios will
represent a higher portion of B2Holding's future purchasing given
the markets that it is focused on. Over time, this should reduce
the high proportion of unsecured consumer credit in its back-
book, currently close to 70%. As well as the potential for
further geographic and asset class diversity, we think that
B2Holding's creditworthiness benefits from the knowledge of its
local management teams given the fragmented nature of the
European nonperforming loan markets.

"We believe that B2Holding's listed status and target leverage
metrics increase the predictability of its financial profile
compared with some of its sponsor-owned peers. Our assessment of
B2Holding's financial risk profile reflects our expectation for
leverage and debt-servicing metrics after its proposed Nordic
bond issuance (not rated). We understand that B2Holding will use
the proceeds from the bond issuance and upsized revolving credit
facility (RCF) to support business growth.

"Our base case assumes continued high organic and acquisitive
growth. This reflects the availability of good market
opportunities, resulting in projected asset and revenue growth of
around 50% in 2018. Despite this, we expect B2Holding to maintain
relatively stable credit metrics over the coming year, as we
expect cash EBITDA to improve, offset by our expectation that a
significant portion of growth will be funded with incremental
debt. However, given recent evidence of its supportive
shareholder structure, we think that B2Holding may be less
reliant on the debt markets than certain peers to fund future
growth. Our view is supported by the recent capital increase of
EUR75 million to fund the acquisition of NACC, a relatively small
French debt purchaser with a good franchise in small-to-midsize
enterprise and retail secured loans."

Based on these assumptions, S&P arrives at the following forward-
looking credit measures:

-- Gross debt to S&P Global Ratings-adjusted EBITDA of 3x-4x;
-- Funds from operations (FFO) to debt of 20%-30%; and
-- Adjusted EBITDA to interest of 5x-6x.

S&P said, "Our analysis is based on the consolidated accounts of
B2Holding. When calculating our weighted-average ratios for
B2Holding, we apply a 20% weight to year-end 2017 financial
figures and 40% to each of our 2018 and 2019 year-end
projections.

"The stable outlook reflects our view that B2Holding will
maintain discipline in constraining its risk appetite for new
investments while it continues its rapid growth phase. The
outlook also reflects our expectation that B2Holding's leverage
metrics will not worsen from its target levels, supported by
stable profitability.

"We could raise the ratings in the next 12 months if B2Holding's
growth phase leads to increasing geographic diversity in the
group's earnings profile, combined with complementary growth in
its credit management services business. An upgrade would be
contingent on B2Holding reducing its revenue concentration and
improving its scale relative to higher rated peers, while
maintaining its current profitability and credit metrics.

"We could lower the ratings in the next 12 months if we saw a
weakening in B2Holding's credit or profitability metrics,
indicating weakening investment discipline or significant
increases in competitive pressure. Specifically, we could lower
the ratings if gross debt to adjusted EBITDA was in excess of
4.0x, or FFO to debt fell below 20%. Adverse changes in the
regulatory environment for debt purchasers in the jurisdiction
where the group has material exposures could also lead us to
lower the ratings."


NORSKE SKOG: Oceanwood Agrees to Buy Business for EUR235MM
----------------------------------------------------------
Luca Casiraghi at Bloomberg News reports that Oceanwood Capital
Management LLP agreed to buy Norske Skog AS for EUR235 million
(US$281 million), ending a long battle over the bankrupt
papermaker and handing bondholders big losses.

According to Bloomberg, Norske Skog said the deal was agreed on
after a four-month auction process, in which more than 100
prospective bidders were approached.

The company said Oceanwood, the biggest owner of the company's
secured notes, offered the highest value in cash for the shares
and the inter-company loans, Bloomberg relates.

The deal will mean a 69% recovery for the holders of the
company's EUR290 million 2019 secured bond and the lenders in the
EUR16 million liquidity facility, Bloomberg notes.  No recovery
will be available for investors in the EUR159 million senior note
maturing in 2021 and the US$61 million senior notes due in 2023,
Bloomberg states.

The secured bonds were indicated close to par value until
December, according to data compiled by Bloomberg.

"Our first investment in Norske Skog was back in 2015 and we have
supported and worked constructively with the group since,"
Bloomberg quotes John Chiang, an investment adviser at Oceanwood,
as saying in a statement.  "In November 2017, as it became
apparent that it would be difficult to reach a consensual
solution and solve the financial issues in the former Norske
Skogindustrier holding structure, we decided to act to protect
the operating companies."

Foxhill Capital Partners LLC had sought to block a sale, arguing
that Oceanwood's stake created a conflict of interest that should
prevent it from prompting the sale as well as bidding, Bloomberg
recounts.

                        About Norske Skog

Norske Skogindustrier ASA or Norske Skog, which translates as
Norwegian Forest Industries, is a Norwegian pulp and paper
company based in Oslo, Norway and established in 1962.

                        *   *   *

As reported by the Troubled Company Reporter-Europe on December
5, 2017, S&P Global Ratings revised its long- and short-term
corporate credit ratings on Norske Skogindustrier ASA (Norske
Skog) and its core rated subsidiaries to 'D' (default) from 'SD'
(selective default) as the issuer has now defaulted on all of its
notes.  At the same time, S&P lowered its issue rating on the
unsecured notes due in 2033 and issued by Norske Skog Holding AS
to 'D' from 'C'. S&P also removed the issue ratings from
CreditWatch with negative implications, where it had placed them
on June 6, 2017. S&P also affirmed its 'D' ratings on the senior
secured notes due in 2019, and the unsecured notes due in 2021,
2023, and 2026.

The downgrade follows the nonpayment of the cash coupon due on
Norske Skog's unsecured notes due in 2033 before the expiry of
the grace period on Nov. 15, 2017, S&P noted.

The 'D' ratings on the secured notes due 2019, and the unsecured
notes due in 2021, 2023, 2026, and 2033, reflect the nonpayment
of interest payments beyond any contractual grace periods, which
S&P considers a default.

The TCR-Europe also reported on July 24, 2017 that Moody's
Investors Service downgraded the probability of default rating
(PDR) of Norske Skogindustrier ASA (Norske Skog) to Ca-PD/LD from
Caa3-PD. Concurrently, Moody's has affirmed Norske Skog's
corporate family rating (CFR) of Caa3.  In addition, Moody's also
affirmed the C rating of Norske Skog's global notes due 2026 and
2033 and its perpetual notes due 2115, the Caa2 rating of the
senior secured notes issued by Norske Skog AS and downgraded the
rating of the global notes due 2021 and 2023 issued by Norske
Skog Holdings AS to Ca from Caa3.  The outlook on the ratings
remains stable.  The downgrade of the PDR to Ca-PD/LD from Caa3-
PD reflects the fact that Norske Skog did not pay the interest
payment on its senior secured notes issued by Norske Skog AS,
even after the 30 day grace period had elapsed on July 15.  This
constitutes an event of default based on Moody's definition, in
spite of the existence of a standstill agreement with the debt
holders securing that an enforcement will not be made under the
secured notes due to non-payment of interest.  In addition, the
likelihood of further events of defaults in the next 12-18 months
remains fairly high, as the company is also amidst discussions
around an exchange offer that would most likely involve
equitisation of debt, which the rating agency would most likely
view as a distressed exchange.


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


ASIAN-PACIFIC: Fitch Alters 'CCC' LT IDR Watch to Positive
----------------------------------------------------------
Fitch Ratings has revised the Rating Watch on Asian-Pacific
Bank's (APB) Long-Term Issuer-Default Ratings (IDRs) of 'CCC' to
Positive from Negative. At the same time, the agency has affirmed
the bank's Viability Rating (VR) at 'f'.

KEY RATING DRIVERS
The rating action follows yesterday's announcement by the Central
Bank of Russia (CBR) that financial rehabilitation measures will
be applied to APB through the recently created Banking Sector
Consolidation Fund. Officials of the CBR and the fund will take
over the management of the bank. No moratorium on payments to
creditors has been introduced, and the bank will continue to meet
its obligations, according to the CBR statement.

The Rating Watch Positive (RWP) reflects Fitch's view that the
risk of APB's senior creditors suffering credit losses as a
result of the bank's weak capital position should diminish
following the regulatory intervention. This view is based on the
CBR's statement that the bank will continue to meet its
obligations, and the precedent set by other banks taken over by
the fund, which have not imposed losses on senior creditors even
though they have defaulted on subordinated debt.

Whether APB defaults on its subordinated obligations (not rated
by Fitch) is likely to depend on the CBR's assessment of the
bank's capital position. At end-2017, APB had an outstanding
USD30 million subordinated loan from an international financial
institution and an USD42 million Eurobond, equal to about 4% of
regulatory risk-weighted assets.

The affirmation of APB's VR at 'f' reflects Fitch's view that the
CBR is likely to require measures to strengthen the bank's
solvency and restore the bank's viability. At end-1Q18, Fitch
understands from management that APB had created all required
reserves in respect of its failed subsidiary M2M Bank and
remained just compliant with minimum capital requirements
excluding buffers (core tier 1 of 6.2% vs. minimum 4.5%, tier 1
of 6.2% vs. 6% and total of 9.1% vs. 8%). However, all three
ratios were lower than the minimum levels including buffers
(6.4%, 7.9% and 9.9%, respectively).

APB's Support Rating (SR) of '5' and Support Rating Floor (SRF)
of 'No Floor' reflect the bank's small market shares and limited
systemic importance, in light of which support from the Russian
authorities in the long term and in all circumstances cannot be
relied upon. However, in the near term, Fitch believes that
support is likely to be sufficient to ensure that the bank meets
its obligations to senior creditors.

RATING SENSITIVITIES
Fitch will resolve the Watch and upgrade the bank's IDRs and VR
if APB's capital position is restored as a result of the
rehabilitation measures.

The IDRs, SR and SRF could also be upgraded if Fitch believes
that the bank is likely to remain in state ownership and benefit
from support measures over the medium- to long-term, or if it is
sold to a stronger strategic investor.

The IDRs could be affirmed at their current levels if the capital
position remains weak and the bank is sold to a weak new owner.
The IDRs could be downgraded if, against Fitch's current
expectations, losses are imposed on non-affiliated senior
creditors to help restore the bank's viability.

The rating actions are as follows:

Asian-Pacific Bank
Long-Term Foreign and Local Currency IDRs: 'CCC', Rating Watch
Revised to Positive from Negative
Short-Term Foreign Currency IDR: 'C', Rating Watch Revised to
Positive from Negative
Viability Rating: affirmed at 'f'
Support Rating: affirmed at '5'
Support Rating Floor: affirmed at 'No Floor'


IBA-MOSCOW: Moody's Withdraws B3 Long-Term Deposit Ratings
----------------------------------------------------------
Moody's Investors Service has withdrawn IBA-Moscow's following
ratings:

Long-term local- and foreign-currency deposit rating of B3

Short-term local and foreign-currency deposit ratings of Not
Prime

Long-term Counterparty Risk Assessment of B2(cr)

Short-term Counterparty Risk Assessment of Not Prime(cr)

Baseline credit assessment (BCA) and adjusted BCA of b3

At the time of the withdrawal, all the bank's long-term ratings
carried a stable outlook.

RATINGS RATIONALE

Moody's has decided to withdraw the ratings for its own business
reasons.

IBA-Moscow is a small Russia-based bank which was established in
2002 as a 100%-owned foreign subsidiary of International Bank of
Azerbaijan, Azerbaijan's largest state-controlled bank. In March
2018, the bank's controlling shareholder decided to liquidate
some subsidiaries, including IBA-Moscow.


STAVROPOL REGION: Fitch Affirms 'BB' IDRs, Alters Outlook to Pos.
-----------------------------------------------------------------
Fitch Ratings has revised the Outlook on Russian Stavropol
Region's Long-Term Foreign- and Local-Currency Issuer Default
Ratings (IDRs) to Positive from Stable and affirmed the IDRs at
'BB'. Fitch has also affirmed the region's Short-Term Foreign-
Currency IDR at 'B' and its outstanding senior unsecured domestic
bonds at 'BB'.

The revision of the Outlook to Positive reflects the expected
consolidation of the region's operating balance at above 10% of
operating revenue over the medium term, stabilisation of the
direct risk relative to current revenue and debt payback
generally in line with the average life of debt.

KEY RATING DRIVERS
The Outlook revision reflects the following rating drivers and
their relative weights:

High
Consolidated Operating Performance
Fitch expects consolidation of the region's operating balance at
13%-15% of operating revenue in 2018-2020, which is higher than
average historical level of 9% in 2013-2016. The operating
performance will be supported over the medium term by increased
transfers from the federal budget and the cost-efficient
management.

In 2017 the region's operating margin peaked at 17.7% (2016:
11.2%) being supported by 11% growth of taxes and 18% increase of
current transfers form the federal budget. The administration
expects that corporate income tax, which was the largest
contributor to tax growth, will decline in 2018 due to needing to
return part of the overpaid amount to taxpayers, leading to
stagnation of tax revenue in 2018. Positively, this will be
compensated by the continued increase of general purpose grants
from the federal government as a result of changing the
distribution formula.

Driven by exceptionally high revenue proceeds, the region
recorded a surplus budget before debt in 2017 for the first time
in at least the last five years of 2% of total revenue. According
to Fitch's rating case, the deficit will be low at 2% over the
medium term, which will limit recourse to new debt.

Medium
Direct Risk Stabilisation
Fitch expects the region's direct risk will remain moderate
within the range of 40%-45% of current revenue over the medium
term. The direct risk declined to RUB36.7billion in 2017 from
RUB38.4billion in 2016, or to 42.7% from almost 50% relative to
current revenue. As of 1 January 2018 budget loans represented
45% of the region's direct risk followed by medium-term bank
loans, which comprised 36% of the total, while the residual was
issued debt.

At end-2017, the maturity of RUB15.7 billion was prolonged until
2024 according to the federal government programme of
restructuring budget loans that were granted to the regions in
2015-2017. This prolonged the maturity profile and improved the
weighted average life of region's debt to 3.7 years, which
exceeded that debt payback (direct-risk-to-current balance) of
2.6 years as of 2017.

Low
Modest Economic Scale
Stavropol's socio-economic profile is historically weaker than
that of the average Russian region. Favourable climate conditions
and rich soils led to the development of agriculture in the
region, which used to be the largest contributor to GRP. Due to
the low value added generated by this sector, Stavropol's GRP per
capita was just 66% of the national median in 2015. According to
preliminary data, the region's economy grew 2.8% in 2017 after
stagnation in 2016 thus outpacing the national growth of 1.5%.
Fitch expects the Russian economy will grow 2% in 2018-2019, and
the regional economy is likely to follow this trend.

Prudent Management
The administration follows a prudent and conservative budgetary
policy, which is evident in modest opex growth averaging 3.5%
during the last five years and a moderate level of debt. At the
same time, the administration maintains a relatively high level
of capex, which averaged 20% of total spending in 2013-2017, to
invest in the development of social infrastructure in the region
(roads, kindergartens, clinics) and further development of the
agricultural sector.

Evolving Institutional Framework
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 its international peers. This leads to
lower 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
Maintenance of sound operating performance and a debt payback
(direct risk to current balance) in line with the region's
weighted average life of debt would lead to an upgrade.


SVERDLOVSK REGION: Fitch Affirms IDRs at BB+, Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed Russian Sverdlovsk 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'. The region's outstanding senior unsecured domestic debt has
been affirmed at BB+.

KEY RATING DRIVERS
The affirmation of 'BB+' ratings reflects Fitch's expectation
that Sverdlovsk will maintain moderate direct risk and a
satisfactory operating performance with an operating balance
sufficient for interest payment coverage. The ratings also factor
in the region's developed industrialised economy, albeit exposed
to business cycle volatility, the region's limited expenditure
flexibility and a weak institutional framework for Russian sub-
nationals.

Fiscal Performance Assessed as Neutral
According to Fitch's rating case scenario Sverdlovsk will
consolidate its operating balance at about 6%-8% of operating
revenue in 2018-2020. This will be supported by moderate growth
of taxes, which contribute about 90% of operating revenue, and
continuous cost control. In 2016-2017, the operating margin
exceeded 8%, extending its recovery from a period of sluggish
performance in 2013-2015. This was mainly driven by an expansion
of the tax base on the back of Russia's economic recovery.

Under Fitch's rating case scenario, Sverdlovsk will maintain a
fiscal deficit at around 2% of total revenue in 2018-2020, after
having successfully narrowed it in 2016 and 2017 to 3.1% and 1.6%
respectively. This was a notable improvement from its large
deficits of 2013-2015 averaging at 12.8%.

Expenditure flexibility is limited. The scope for capex reduction
is almost exhausted, with the share of capital outlays
approaching 10% of total expenditure. Capex is lagging its
national peers and likely to remain in this range over the medium
term unless the region receives additional capital transfers from
the federal budget.

Debt and other Long-Term Liabilities Assessed as Neutral
Fitch expects Sverdlovsk will maintain direct risk at moderate
levels, which Fitch projects at below 40% of current revenue. In
2017, the debt burden grew to RUB74.5 billion (2016: RUB71.1
billion), mostly due to new loans from the federal budget, while
the cash balance remained sound and stable at RUB2 billion.
However, as a share of current revenue direct risk slightly
declined to 36% in 2017 from 38% in 2015. At end-2017, the
region's debt portfolio was dominated by medium-term bank loans
(52%), followed by low-cost budget loans (28%) and domestic bonds
(20%).

Sverdlovsk improved its debt structure and maturity profile in
2017 by refinancing short-term bank loans and tapping the capital
market with RUB10 billion bond issues with final maturity in
2025. Additionally, the region participated in the budget loan
restructuring programme initiated by the federal government at
end-2017. Under the programme, the maturity of the region's
RUB18.1 billion budget loans granted in 2015-2017 has been
extended to 2024.

The region remains exposed to refinancing pressure in the medium
term as 52% of its direct risk maturities are concentrated in
2019-2021. The region's weighted average life of debt (estimated
by Fitch at 4.3 years at end-2017) is short compared with
international peers'. Fitch expects that the region will continue
to have reasonable access to the capital market to refinance its
maturing debt. The region does not plan to contract additional
budget loans in 2018-2020 and will fund its refinancing needs
with bank loans and new bond issues.

Management and Administration Assessed as Neutral
The administration's policy agenda is well-balanced, focused on
regional development with prudent fiscal management and a
conservative debt policy. At the same time as with most Russian
local and regional governments (LRGs), Sverdlovsk's budgetary
policy is dependent on the decisions of the federal authorities.
During 2016-2017 the region improved its budgetary performance by
streamlining and controlling expenditure and we assume no
significant changes to the budgetary practice over the medium
term.

Economy Assessed as Neutral
Sverdlovsk has a developed industrial economy weighted towards
the metallurgical and machine-building sectors. Its wealth
metrics are above the median for Russian regions with GRP per
capita 25% above the regional median in 2015. However,
concentration on a few sectors of the processing industry exposes
the region's revenue to economic cycles. Fitch projects Russia's
economy will grow 2% per year in 2018, which should contribute to
the region's economic recovery.

Institutional Framework Assessed as Weakness
Sverdlovsk's credit profile is constrained by the weak Russian
institutional framework for LRGs. It has a short track record of
stable development compared with many of its international peers.
The unstable intergovernmental set-up leads to lower
predictability of LRGs' budgetary policies and hampers the
region's forecasting ability, negatively affecting investment and
debt policies.

RATING SENSITIVITIES
A sustainable improvement of budgetary performance with an
operating balance at above 10% of operating revenue, accompanied
by a direct risk payback (2017: 5.7 years) below weighted average
life of debt (2017: 4.3 years) could lead to an upgrade.

A weak operating balance that is insufficient to cover interest
expenses or continuous growth of direct risk toward 60% of
current revenue without material improvements to the operating
balance would lead to a downgrade.


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


AYT KUTXA HIPOTECARIO I: S&P Affirms BB+ Rating on Cl. C Notes
--------------------------------------------------------------
S&P Global Ratings raised and removed from CreditWatch positive
its credit ratings on AyT Kutxa Hipotecario I, Fondo de
Titulizacion de Activos' class A and B notes. At the same time,
S&P has affirmed its 'BB+ (sf)' rating on the class C notes.

S&P said, "The rating actions follow the application of our
relevant criteria and our full analysis of the most recent
transaction information that we have received, and reflect the
transaction's current structural features. We have also
considered our updated outlook assumptions for the Spanish
residential mortgage market.

"Our structured finance ratings above the sovereign (RAS)
criteria classify the sensitivity of this transaction as
moderate. Therefore, after our March 23, 2018 upgrade of Spain to
'A-' from 'BBB+', the highest rating that we can assign to the
senior-most tranche in this transaction is six notches above the
Spanish sovereign rating, or 'AAA (sf)', if certain conditions
are met. For all the other tranches, the highest rating that we
can assign is four notches above the sovereign rating.

"Following the sovereign upgrade, on April 6, 2018, we raised to
A from A- our long-term issuer credit rating (ICR) on Banco
Santander S.A., which is the guaranteed investment contract (GIC)
provider in this transaction

"Under our counterparty criteria, the rating on the class A notes
is no longer capped by the dynamic downgrade language in the GIC.

"Our European residential loans criteria, as applicable to
Spanish residential loans, establish how our loan-level analysis
incorporates our current opinion of the local market outlook. Our
current outlook for the Spanish housing and mortgage markets, as
well as for the overall economy in Spain, is benign. Therefore,
we revised our expected level of losses for an archetypal Spanish
residential pool at the 'B' rating level to 0.9% from 1.6%, in
line with table 87 of our European residential loans criteria, by
lowering our foreclosure frequency assumption to 2.00% from 3.33%
for the archetypal pool at the 'B' rating level.

"After applying our European residential loans criteria to this
transaction, the overall effect in our credit analysis results is
a decrease in the required credit coverage for each rating level
compared with our previous review, mainly driven by our revised
foreclosure frequency assumptions."

  Rating level     WAFF (%)    WALS (%)
  AAA                 23.70       17.75
  AA                  16.03       13.64
  A                   12.07        7.83
  BBB                  8.92        5.25
  BB                   5.76        3.69
  B                    3.36        2.51

  WAFF--Weighted-average foreclosure frequency.
  WALS--Weighted-average foreclosure severity.

The class A, B and C notes' credit enhancement has remained
unchanged since our previous review at 16.9%, 9.2%, and 3.6%,
respectively. This is because the notes have been amortizing pro
rata.

S&P said, "Following the application of our criteria, we have
determined that our assigned ratings on the classes of notes in
this transaction should be the lower of (i) the rating as capped
by our RAS criteria, (ii) the rating as capped by our
counterparty criteria, or (iii) the rating that the class of
notes can attain under our European residential loans criteria.

"The application of our RAS criteria caps our rating on the class
A notes at four notches above our unsolicited 'A-' long-term
sovereign rating on Spain. We have therefore raised to 'AA (sf)'
from 'AA- (sf)' and removed from CreditWatch positive our rating
on the class A notes.

"The application of our European residential loans criteria,
including our updated credit figures, determines our rating on
the class B notes at 'A- (sf)'. Under our RAS criteria, this
class is unable to achieve any rating above our unsolicited 'A-'
long-term sovereign rating on Spain. We have therefore raised to
'A- (sf)' from 'BBB+ (sf)' and removed from CreditWatch positive
our rating on this class of notes.

"In reviewing our rating on the class C notes, in addition to
applying our credit and cash flow analysis in line with our
European residential loans criteria, we have considered the
tranche's stable performance and unchanged credit enhancement
since our previous review. Therefore, we have affirmed and
removed from CreditWatch positive our 'BB+ (sf)' rating on this
class of notes."

AyT Kutxa Hipotecario I is a Spanish residential mortgage-backed
securities (RMBS) transaction, which closed in May 2006.

  RATINGS LIST

  Class             Rating
              To               From

  AyT Kutxa Hipotecario I, Fondo de Titulizacion de Activos
  EUR750 Million Mortgage-Backed Floating-Rate Notes

  Ratings Raised And Removed From CreditWatch Positive

  A           AA (sf)         AA- (sf)/Watch Pos
  B           A- (sf)         BBB+ (sf)/Watch Pos

  Rating Affirmed

  C           BB+ (sf)


AYT KUTXA HIPOTECARIO II: S&P Affirms CCC+(sf) Rating on C Notes
----------------------------------------------------------------
S&P Global Ratings raised and removed from CreditWatch positive
its credit ratings on AyT Kutxa Hipotecario II's class A and B
notes. At the same time, S&P affirmed its 'CCC+ (sf)' rating on
the class C notes.

S&P said, "The rating actions follow the application of our
relevant criteria and our full analysis of the most recent
transaction information that we have received, and reflect the
transaction's current structural features. We have also
considered our updated outlook assumptions for the Spanish
residential mortgage market.

"Our structured finance ratings above the sovereign (RAS)
criteria classify the sensitivity of this transaction as
moderate. Therefore, after our March 23, 2018 upgrade of Spain to
'A-' from 'BBB+', the highest rating that we can assign to the
senior-most tranche in this transaction is six notches above the
Spanish sovereign rating, or 'AAA (sf)', if certain conditions
are met. For all the other tranches, the highest rating that we
can assign is four notches above the sovereign rating.

"Following the sovereign upgrade, on April 6, 2018, we raised to
'A' from 'A-' our long-term issuer credit rating (ICR) on Banco
Santander S.A., which is the guaranteed investment contract (GIC)
provider in this transaction.

"Under our counterparty criteria, the rating on class A notes are
no longer capped by the dynamic downgrade language in the GIC.

"Our European residential loans criteria, as applicable to
Spanish residential loans, establish how our loan-level analysis
incorporates our current opinion of the local market outlook. Our
current outlook for the Spanish housing and mortgage markets, as
well as for the overall economy in Spain, is benign. Therefore,
we revised our expected level of losses for an archetypal Spanish
residential pool at the 'B' rating level to 0.9% from 1.6%, in
line with table 87 of our European residential loans criteria, by
lowering our foreclosure frequency assumption to 2.00% from 3.33%
for the archetypal pool at the 'B' rating level.

"After applying our European residential loans criteria to this
transaction, the overall effect in our credit analysis results is
a decrease in the weighted-average foreclosure frequency (WAFF)
at each rating level compared with our previous review, mainly
driven by our revised foreclosure frequency assumptions and an
increase in the weighted-average loss severity (WALS) at each
rating level compared with our previous review, mainly driven by
our updated overvaluation assumption for the Spanish residential
market."

  Rating level     WAFF (%)    WALS (%)
  AAA                 23.95       29.39
  AA                  16.37       25.08
  A                   12.46       18.15
  BBB                  9.28       14.50
  BB                   6.12       12.01
  B                    3.67        9.85

The class A, B, and C notes' credit enhancement has remained
unchanged at 20.08%, 8.43%, and 3.62%, respectively. This is
because S&P's analysis in its current and previous reviews were
conducted using the same notes' and collateral balance.

S&P said, "Following the application of our criteria, we have
determined that our assigned ratings on the classes of notes in
this transaction should be the lower of (i) the rating as capped
by our RAS criteria, (ii) the rating as capped by our
counterparty criteria, or (iii) the rating that the class of
notes can attain under our European residential loans criteria.

"The application of our RAS criteria caps our rating on the class
A notes at six notches above our unsolicited 'A-' long-term
sovereign rating on Spain. We have therefore raised to 'AAA (sf)'
from 'AA (sf)' and removed from CreditWatch positive our rating
on this class of notes.

"The application of our European residential loans criteria,
including our updated credit figures, determines our rating on
the class B notes at 'A- (sf)'. Under our RAS criteria, this
class of notes is unable to achieve any rating above our
unsolicited 'A-' long-term sovereign rating on Spain. We have
therefore raised to 'A- (sf)' from 'BBB (sf)' and removed from
CreditWatch positive our rating on this class of notes.

"Following the application of our "General Criteria: Criteria For
Assigning 'CCC+', 'CCC', 'CCC-', And 'CC' Ratings," published on
Oct. 1, 2012, we believe that payments on the class C notes are
dependent upon favorable financial and economic conditions, and
therefore, the notes cannot achieve a higher rating level.
Consequently, we have affirmed our 'CCC+ (sf)' rating on this
class of notes."

AyT Kutxa Hipotecario II is a Spanish residential mortgage-backed
securities (RMBS) transaction, which closed in February 2007.

  RATINGS LIST

  Class             Rating
              To               From

  AyT Kutxa Hipotecario II, Fondo de Titulizacion de Activos
  EUR1.2 Billion Mortgage-Backed Floating-Rate Notes

  Ratings Raised And Removed From CreditWatch Positive

  A           AAA (sf)         AA (sf)/Watch Pos
  B           A- (sf)          BBB (sf)/Watch Pos

  Rating Affirmed

  C           CCC+ (sf)


GC PASTOR 5: S&P Raises A2 Notes Rating to B+(sf), Off Watch Pos.
-----------------------------------------------------------------
S&P Global Ratings raised and removed from CreditWatch positive
its credit rating on GC Pastor Hipotecario 5, Fondo de
Titulizacion de Activos' class A2 notes. At the same time, S&P
affirmed its 'CC (sf)' rating on the class B notes and its 'D
(sf)' ratings on the class C and D notes.

S&P said, "The rating actions follow the application of our
relevant criteria and our full analysis of the most recent
transaction information that we have received, and reflect the
transaction's current structural features. We have also
considered our updated outlook assumptions for the Spanish
residential mortgage market.

"Our structured finance ratings above the sovereign (RAS)
criteria classify the sensitivity of this transaction as
moderate. Therefore, after our March 23, 2018 upgrade of Spain to
'A-' from 'BBB+', the highest rating that we can assign to the
senior-most tranche in this transaction is six notches above the
Spanish sovereign rating, or 'AAA (sf)', if certain conditions
are met. For all the other tranches, the highest rating that we
can assign is four notches above the sovereign rating.

"Our European residential loans criteria, as applicable to
Spanish residential loans, establish how our loan-level analysis
incorporates our current opinion of the local market outlook. Our
current outlook for the Spanish housing and mortgage markets, as
well as for the overall economy in Spain, is benign. Therefore,
we revised our expected level of losses for an archetypal Spanish
residential pool at the 'B' rating level to 0.9% from 1.6%, in
line with table 87 of our European residential loans criteria, by
lowering our foreclosure frequency assumption to 2.00% from 3.33%
for the archetypal pool at the 'B' rating level.

"The class B and C notes feature interest deferral triggers of
10.00% and 6.70%, respectively, based on cumulative gross
defaults as a percentage of the closing portfolio balance. Since
our May 25, 2017 review, cumulative defaults have increased to
9.96% from 9.74%. Consequently, the class C notes' interest
deferral trigger was breached, leading to a class C payment
default. In our view, the class B interest deferral trigger will
also be breached in the short term. Once the trigger is breached,
the payment of the class B notes' interest will be postponed
after the class A2 notes' principal amortization, resulting in an
interest shortfall on the class B notes.

"After applying our European residential loans criteria to this
transaction, the overall effect in our credit analysis results is
a decrease in the required credit coverage at 'BBB', 'BB', and
'B' rating levels, and a decrease at all other rating levels,
except 'AAA', compared with our previous review. The result is
mainly driven by our revised foreclosure frequency assumptions
and updated market value decline assumptions."

  Rating level     WAFF (%)    WALS (%)
  AAA                 12.99       34.81
  AA                   9.21       30.26
  A                    7.02       21.73
  BBB                  5.36       16.49
  BB                   3.81       12.84
  B                    2.52        9.75

  WAFF--Weighted-average foreclosure frequency.
  WALS--Weighted-average loss severity.

The class A2, B, C and D notes' credit enhancement, based on the
performing balance, has decreased to 0.15%, (10.99)%, (14.26)%,
and (18.96)%, respectively, from 0.44%, (9.49)%, (12.41)%, and
(16.59)% due to an increase in defaulted loans in the
transaction. The reserve fund has been fully depleted since
August 2010.

S&P said, "Following the application of our criteria, we have
determined that our assigned ratings on the classes of notes in
this transaction should be the lower of (i) the rating as capped
by our RAS criteria, (ii) the rating as capped by our
counterparty criteria, or (iii) the rating that the class of
notes can attain under our European residential loans criteria.

"Despite the lower credit enhancement, in our cash flow analysis
the class A2 notes benefit from our lower projected losses in the
'B' rating category and from the funds diverted from the class B
notes once the interest deferral trigger is breached. Our updated
credit and cash flow analysis indicates that the available credit
enhancement for the class A2 notes is commensurate with a higher
rating than currently assigned. We have therefore raised to
'B+'(sf) from 'B-'(sf) and removed from CreditWatch positive our
rating on this class of notes.

"Given the negative available credit enhancement, the cash
reserve fund's current level, the interest deferral trigger's
current level, the payment of interest and principal on the class
B notes still depends upon favorable business, financial, and
economic conditions, in our view. We have therefore affirmed our
'CC (sf)' rating on this class of notes. We have affirmed our 'D
(sf)' ratings on the class C and D notes as they continue to miss
interest payments."

GC Pastor Hipotecario 5 closed in June 2007 and securitizes a
portfolio of mortgages granted to individuals, self-employed
individuals, and small and midsize enterprise (SMEs) to buy
Spanish residential or commercial properties.

  RATINGS LIST

  Class             Rating
              To               From

  GC Pastor Hipotecario 5, Fondo de Titulizacion de Activos
  EUR710.5 Million Floating-Rate Mortgage-Backed Notes

  Rating Raised And Removed From CreditWatch Positive

  A2          B+ (sf)          B- (sf)/Watch Pos

  Ratings Affirmed

  B           CC (sf)
  C           D (sf)
  D           D (sf)


IM BCC: Moody's Assigns Caa2 Rating to EUR240M Serie B Notes
------------------------------------------------------------
Moody's Investors Service has assigned the following definitive
ratings to the debts issued by IM BCC CAJAMAR PYME 2, FONDO DE
TITULIZACION:

EUR760M Serie A Notes, Definitive Rating Assigned A2 (sf)

EUR240M Serie B Notes, Definitive Rating Assigned Caa2 (sf)

The transaction is a static cash securitisation of term loans
granted by Cajamar Caja Rural, Sociedad Cooperativa de Credito
("Cajamar", NR) to small and medium-sized enterprises (SMEs) and
self-employed individuals located in Spain.

RATINGS RATIONALE

The ratings of the Notes are primarily based on the analysis of
the credit quality of the underlying portfolio, the structural
integrity of the transaction, the roles of external
counterparties and the protection provided by credit enhancement.

In Moody's view, the strong credit positive features of this deal
include, among others: (i) Cajamar's expertise in lending to the
agriculture sector, which is closely linked to the pool's
exposure to Beverage, Food & Tobacco sector, in terms of Moody's
industry classification; (ii) granular portfolio with low obligor
concentration as the top obligor and top 10 obligor groups
represent 0.5% and 4.1% respectively; (iii) exposure to the
construction and building sector in terms of Moody's industry
classification at around 6.6% of the total pool is well below the
average observed in the Spanish market. However, the transaction
has several challenging features, such as: (i) there is a high
sector concentration as around 51.1% of the portfolio volume is
concentrated in the Beverage, Food & Tobacco sector, in terms of
Moody's industry classification; (ii) the portfolio is exposed to
refinancing loans, representing around 17.5% of the audited
provisional asset pool as of 23 March 2018; (iii) there is no
interest rate hedge mechanism in place while the Notes pay a
floating coupon and 47.8% of the pool balance are either fixed
rate loans or loans that initially pay a fixed rate (switching to
a floating rate at a later stage).

Key collateral assumptions:

Mean default rate: Moody's assumed a mean default rate of 13%
over a weighted average life of 4.1 years (equivalent to a B1
proxy rating as per Moody's Idealized Default Rates). This
assumption is based on: (1) the available historical vintage
data, (2) the performance of the previous transactions originated
by Cajamar and (3) the characteristics of the loan-by-loan
portfolio information. Moody's also have taken into account the
current economic environment and its potential impact on the
portfolio's future performance, as well as industry outlooks or
past observed cyclicality of sector-specific delinquency and
default rates.

Default rate volatility: Moody's assumed a coefficient of
variation (i.e. the ratio of standard deviation over the mean
default rate explained above) of 58.6%, as a result of the
analysis of the portfolio concentrations in terms of single
obligors and industry sectors.

Recovery rate: Moody's assumed a 40% stochastic mean recovery
rate, primarily based on the characteristics of the collateral-
specific loan-by-loan portfolio information, complemented by the
available historical vintage data.

Portfolio credit enhancement: the aforementioned assumptions
correspond to a portfolio credit enhancement of 38.5%, that takes
into account the Spanish current local currency country risk
ceiling (LCC) of Aa1.

As of March 23, 2018, the audited provisional asset pool of
underlying assets was composed of a portfolio of 21,003 contracts
amounting to EUR1,098 million. The top industry sector in the
pool, in terms of Moody's industry classification, is Beverage,
Food & Tobacco (51.1 %). The top borrower represents 0.5% of the
portfolio and the effective number of obligors is 1,580.The
assets were originated mainly between 1997 and 2017 and have a
weighted average seasoning of 2.6 years and a weighted average
remaining term of 7.6 years. The interest rate is floating for
52.2% of the pool while the remaining part of the pool bears a
fixed interest rate or loans that initially pay a fixed rate
(switching to a floating rate at a later stage). The weighted
average spread on the floating portion is 2.7%, while the
weighted average interest on the fixed portion is
3.8%.Geographically, the pool is concentrated mostly in Murcia
(22.7%) and Almeria (19.61%). At closing, any loan in arrears for
more than 30 days will be excluded from the final pool. Around
25.2% of the portfolio is secured by first-lien mortgage
guarantees over different types of properties.

Key transaction structure features:

Reserve fund: The transaction benefits from a reserve fund,
equivalent to 3% of the original balance of the Class A and Class
B Notes. The reserve fund provides both credit and liquidity
protection to the Notes.

Counterparty risk analysis:

Cajamar Caja Rural, Sociedad Cooperativa de Credito will act as
servicer of the loans for the Issuer, while InterMoney
Titulizacion , S.G.F.T., S.A (NR) the management company
(Gestora) of the transaction.

All of the payments under the assets in the securitised pool are
paid into the collection account at Cajamar. There is a daily
sweep of the funds held in the collection account into the Issuer
account. The Issuer account is held at Banco Santander S.A.
(Spain) (A2/P-1) with a transfer requirement if the rating of the
account bank falls below Baa2/P-2. Moody's has taken into account
the commingling risk within its cash flow modelling.

Stress Scenarios:

Moody's also tested other sets of assumptions under its Parameter
Sensitivities analysis. For instance, if the assumed default rate
of 13% used in determining the initial rating was changed to 16%
and the recovery rate of 40% was changed to 35%, the model-
indicated rating for Series A and Series B of A2(sf) and Caa2(sf)
would be Baa2(sf) and Caa3(sf) respectively. For more details,
please refer to the full Parameter Sensitivity analysis included
in the New Issue Report of this transaction.

Principal Methodology:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating SME Balance Sheet Securitizations"
published in August 2017.

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

The Notes' ratings are sensitive to the performance of the
underlying portfolio, which in turn depends on economic and
credit conditions that may change. The evolution of the
associated counterparties risk, the level of credit enhancement
and the Spain's country risk could also impact the Notes'
ratings.

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


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


UKRAINE: Fitch Affirms Foreign-Currency IDR at B-, Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has affirmed Ukraine's Long-Term Foreign-Currency
Issuer Default Rating (IDR) at 'B-'. The Outlook is Stable.

KEY RATING DRIVERS
Ukraine's ratings balance weak external liquidity, a high public
debt burden and structural weaknesses, in terms of a weak banking
sector, institutional constraints and geopolitical and political
risks, against improved policy credibility and consistency, the
sovereign's near-term manageable debt repayment profile and a
track record of bilateral and multilateral support.

International reserves reached USD18.2 billion in March 2018 (up
USD3.6 billion yoy), as public debt repayments were partly
mitigated by increased export revenues and capital inflows.
Ukraine's external buffers remain weaker than 'B' peers (3.2
months of CXP). Increased exchange rate flexibility, manageable
foreign-currency commitments and moderate external imbalances
mitigate near-term pressures on international reserves. FX
controls still cushion external liquidity, although they continue
to be gradually eased.

Near-term financing risks are limited, as sovereign debt
repayments remain manageable due to the 2015 debt restructuring,
external and domestic liability management operations in 2017,
the high proportion of domestic debt held by public sector
institutions and multilateral support. Approximately USD1 billion
in cash in Ukraine's treasury and domestic FX liquidity provides
the sovereign with space to bridge gaps in external disbursements
in the short term.

The completion of the fourth review under the IMF Extended Fund
Facility (EFF) remains delayed. The government has made progress
in terms of pension reform, obtained parliament's approval for
the 2018 budget in line with program targets and an updated
privatisation bill. The legislation for the creation of an
independent anti-corruption court is currently in parliament and
could be considered by parliament in mid-May. However, it is not
clear whether the final version will be in line with
international partners' demands. Achieving an agreement with the
IMF regarding household heating tariff hikes and risks to fiscal
targets could further delay finalising the review.

In its baseline scenario, Fitch expects the fourth review to be
finalised in 3Q18, leading to the disbursement of the next
programme tranche (possibly USD1.9 billion). Completing the next
review would facilitate further multilateral financing and likely
provide a window for the sovereign to return to international
markets (USD2 billion). A fourth Macro-Financial Assistance
Programme of EUR1 billion could be approved by the European Union
in mid-2018. Fitch does not anticipate further disbursements
under the current IMF EFF, as the programme is scheduled to end
in early 2019.

Nevertheless, continued engagement with the IMF and international
partners during the 2019 electoral period and its aftermath will
be important to sustain macroeconomic stability improvements,
limit reversals in the reform agenda and maintain access to
external market and official financing. Sovereign debt
amortisations will average USD4 billion per year in 2018-2019
(including USD1.6 billion external market debt in September 2019)
and then rise to UD4.8 billion and USD7.4 billion in 2020 and
2021, respectively.

Gross external financing needs (current account deficit plus
public- and private-sector maturities) have eased but will
average a high 73% of international reserves per year in 2018-
2019. After re-estimation of migrant workers' remittances, Fitch
expects the current account deficit (1.9% of GDP in 2017) to
average 2.7% in 2018-2019, as still favourable prices for
Ukrainians exports and migrant remittances will partly balance
demand-driven import growth. In the near term, net external
borrowing by the private sector and a strong pick-up in FDI are
unlikely.

General government debt dropped by 8pp to 61.5% of GDP (71.8%
including guarantee debt) in 2017 reflecting strong nominal GDP
growth, stronger hryvnia and lower-than-anticipated external
disbursements. Moderate growth, contained deficits and only
limited currency depreciation will support a gradual further
reduction. Debt dynamics remain subject to currency risks (68%
foreign currency denominated).

Fitch estimates that Ukraine's general government deficit reached
2.4% of GDP in 2017, thus outperforming the 2.7% fiscal deficit
target under the IMF programme and the 4.1% 'B' median. Risks to
sustained fiscal consolidation stem from weaker revenue growth,
especially in the event of optimistic revenue projections, and
expenditure pressures in terms of wages, social benefits and
subsidies. Fitch expects the deficit to average 2.8% in 2018-
2019, as significant fiscal slippage would be contained by
limited financing sources.

Ukraine's strengthened policy framework is underpinned by
increased exchange rate flexibility, the National Bank of
Ukraine's (NBU) commitment to sustainably lowering inflation, and
moderate fiscal imbalances. Although end-year inflation (13.7%)
surpassed the NBU's target band of 8% - 2% due to supply shocks
(food prices) and demand side pressures from the labour market,
the monetary authorities increased the policy rate by a total of
450bp to 17% between October and March. Inflation will decline
gradually and average 11.4% and 8% in 2018 and 2019,
respectively, but will remain above 'B' peers.

The financial system continues to represent a contingent
liability for the sovereign due to the large state presence
(54.8% of total assets). Near-term risks have declined due to
improved capitalisation and more favourable macroeconomic
backdrop. Loan portfolio quality is weak. NPLs finished 2017 at
54.5%, and NPL loans net of provisions equalled 10.3%. Despite
rising credit growth to household, overall lending will likely
remain moderate due to loan write-offs reduced risk appetite
among banks and still high corporate leverage.

Growth will remain weaker than 'B' category peers, despite a
forecast recovery. After reaching 2.5% in 2017, Fitch expects
Ukraine to accelerate to 3.2% in 2018 driven by domestic demand.
Private consumption benefits from rising real incomes and
increased access to credit. Investment (20.7% of GDP) is
experiencing a cyclical recovery, but it will remain below 'B'
peers (23.3%).

Despite significant progress in macro stabilisation, energy,
pensions and the fight against corruption, political risks for
the reform agenda stem from powerful vested interests, fragmented
political forces, rising populist voices and the slow recovery
after a deep crisis. Presidential and parliamentary elections are
scheduled for 2019, increasing the political cost of reforms.

The unresolved conflict in eastern Ukraine remains a risk for
overall macroeconomic performance and stability. There are
constant clashes along the contact line, but a material
escalation of hostilities is not part of Fitch's base case
scenario. The USD3 billion outstanding debt dispute with Russia
is in the English Court of Appeals. Fitch does not currently
expect the resolution of the debt dispute to impair Ukraine's
capacity to access external financing and meet external debt
service.

SOVEREIGN RATING MODEL (SRM) and QUALITATIVE OVERLAY (QO)
Fitch's proprietary SRM assigns Ukraine a score equivalent to a
rating of 'CCC' on the Long-Term FC IDR scale.

Fitch's sovereign rating committee adjusted the output from the
SRM to arrive at the final LT FC IDR by applying its QO, relative
to rated peers, as follows.

Macro: +1 notch, to reflect Ukraine's strengthened monetary and
exchange rate policy which will support improved macroeconomic
performance and domestic confidence. Increased exchange rate
flexibility allows the economy to absorb shocks without depleting
reserves

Fitch's SRM is the agency's proprietary multiple regression
rating model that employs 18 variables based on three year-
centred averages, including one year of forecasts, to produce a
score equivalent to a LTFC IDR. Fitch's QO is a forward-looking
qualitative framework designed to allow for adjustment to the SRM
output to assign the final rating, reflecting factors within
Fitch's criteria that are not fully quantifiable and/or not fully
reflected in the SRM.

RATING SENSITIVITIES
The Stable Outlook reflects Fitch's assessment that upside and
downside risks to the rating are currently balanced. Nonetheless,
the following risk factors could, individually or collectively,
trigger negative rating action:
  - Re-emergence of external financing pressures and increased
macroeconomic instability, for example stemming from delays to
disbursements from, or the collapse of, the IMF programme.
  - External or political/geopolitical shock that weakens
macroeconomic performance and Ukraine's fiscal and external
position.

The main factors that, individually or collectively, could
trigger positive rating action are:
  - Increased external liquidity and external financing
flexibility.
  - Improved macroeconomic performance and sustained fiscal
consolidation leading to improved debt dynamics.

KEY ASSUMPTIONS
Fitch does not expect resolution of the conflict in eastern
Ukraine or escalation of the conflict to the point of
compromising overall macroeconomic performance.

Fitch assumes that the debt dispute with Russia will not impair
Ukraine's ability to access external financing and meet external
debt service commitments.

The full list of rating actions is as follows:

Long-Term Foreign-Currency IDR affirmed at 'B-'; Outlook Stable
Long-Term Local-Currency IDR affirmed at 'B-'; Outlook Stable
Short-term foreign-currency IDR affirmed at 'B'
Short-term local-currency IDR affirmed at 'B'
Country Ceiling affirmed at 'B-'
Issue ratings on long-term senior-unsecured foreign-currency
bonds affirmed at 'B-'
Issue ratings on long-term senior-unsecured local-currency bonds
affirmed at 'B-'
Issue ratings on short-term senior-unsecured local-currency bonds
affirmed at 'B'


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


HOUSE OF FRASER: Landlords Brace for Rent Negotiation
-----------------------------------------------------
Aime Williams at The Financial Times reports that shopping centre
landlords Hammerson and Intu are bracing for negotiations with
House of Fraser over tenancies and rent reductions after the
struggling retailer unveiled restructuring plans that involve
store closures.

House of Fraser owner Nanjing Xinjiekou, which has not yet
disclosed which stores will be affected, said on May 2 it would
look to reach a deal with landlords to reduce its rental bill,
the FT relates.

Hammerson and Intu are among those landlords that have most
exposure to the group, the FT states.  The department store chain
is a tenant at four Hammerson shopping centres: Reading's Oracle,
Bristol's Cabot Circus, Croydon's Centrale and Dundrum in Dublin,
the FT discloses.  Intu has stores in Lakeside in Essex,
Nottingham's Victoria centre, and in Gateshead and Norwich,
according to the FT.

Hammerson, as cited by the FT, said it was too early to comment
on House of Fraser's plans.

Intu said it has 7% of House of Fraser's estate but that its rent
makes up only 1% of its secured rent roll, the FT relays.

Nanjing Xinjiekou plans to offload 51% of House of Fraser Group
to Hong-Kong-listed C.banner International in deal that aims to
generate GBP70 million of fresh capital, the FT states.  But the
investment is conditional on the chain pursuing a CVA, the FT
notes.


PI UK HOLDCO: S&P Affirms 'B' Long-Term Issuer Credit Rating
------------------------------------------------------------
S&P Global Ratings said that it affirmed its 'B' long-term issuer
credit rating on PI UK Holdco II Ltd. (Paysafe). The outlook is
stable.

S&P said, "At the same time, we assigned our 'B' issue ratings to
the proposed $800 million equivalent incremental first-lien term
loans and proposed $50 million incremental revolving credit
facility (RCF). We also affirmed the 'B' issue ratings on the
existing $2 billion equivalent first-lien term loan B facilities
and $175 million RCF. The recovery ratings are '3', reflecting
our expectation of meaningful (50%-70%; rounded estimate: 50%)
recovery prospects in the event of a payment default.

"We also assigned our 'CCC+' issue rating to the proposed $50
million incremental second-lien term loan, while affirming our
'CCC+' issue rating on the $450 million equivalent second-lien
term loan facilities. The recovery ratings are '6', reflecting
our expectation of negligible (0%) recovery prospects in the
event of a payment default.

"The rating affirmation reflects our view that while we expect
adjusted gross leverage to remain high at about 8x in 2018 (pro
forma the iPayment Inc. acquisition), free operating cash flow
(FOCF) generation should remain strong due to modest capital
expenditures (capex) and working capital needs. Furthermore, we
believe the iPayment acquisition could result in a slight
improvement to Paysafe's business by increasing its scale and
presence in the U.S. payment processing market, notwithstanding
integration risks and the recent challenges faced by the target
company in our opinion. Finally, the affirmation is supported by
solid operating performance expected over 2018-2019, including
organic revenue growth of 6%-7%.

"Paysafe has entered into an agreement to buy iPayment, a U.S.-
based merchant acquirer focused on the small and midsize business
segment of the market. Paysafe intends to fund this deal with
about $850 million of incremental term loan facilities, as well
as equity from both its shareholders and iPayment's existing
shareholders.

"In addition to the increased total debt balance of about $3.3
billion, we forecast somewhat slower leverage reduction in 2018,
driven by an expected decrease in pro forma S&P Global Ratings-
adjusted EBITDA margins to about 18.5% in 2018 (excluding any
potential International Financial Reporting Standard [IFRS] 15
impact) from about 22.5% in 2017. This largely reflects some
dilution to the enlarged group's margins from consolidating
iPayment, whose company-adjusted margins (at about 12% of gross
revenues in 2017) are significantly lower than Paysafe's (about
27% on a pro forma basis). It also reflects elevated costs
related to the iPayment acquisition and integration (together,
about $25 million assumed in 2018, including M&A advisory fees),
and the ongoing MCPS integration.

"However, we forecast significant adjusted EBITDA growth in 2019
of 17%-19% driven by both organic revenue growth of about 6% and
EBITDA margins improving to 20%-21%. We expect the enlarged group
to maintain its track record of solid organic revenue growth
driven by continued positive trends in non-cash payment
transaction volumes. Higher EBITDA margins should be driven by
operating leverage, good progress in the realization of cost
synergies at MCPS and iPayment, IT-related cost efficiencies, and
assumed lower acquisition and integration-related costs.

"After the transaction closes, we expect FOCF generation will
remain relatively robust at $150 million-$160 million (or about
37.5% of EBITDA) on a pro forma basis in 2018, despite an
expected increase in interest expenses by about $40 million to
$160 million-$170 million due to the greater debt amount. This
reflects the modest capex and working capital needs inherent in
the group's business model. Therefore, we believe pro forma FOCF-
to-debt of about 5% in 2018 should continue to support the
rating.

"From a business risk perspective, we view positively that the
iPayment acquisition will more than double Paysafe's payment
processing revenues to over $1.5 billion in pro forma 2017, and
make it the fifth-largest non-bank merchant acquirer in the U.S.
by transaction volume. While this scale is more in line with
rated European peers, the enlarged group will remain
significantly behind some U.S. peers like Worldpay, First Data,
and Global Payments. It will also help further reduce the group's
exposure to the online gambling sector--which we view as
susceptible to unexpected adverse regulatory changes--to about
16% of pro forma revenues. Further operational benefits include
further increasing the size of the point-of-sale channel within
its omnichannel payments platform and somewhat reducing Paysafe's
reliance on independent sales organizations (ISOs) for U.S.
acquiring, which is typically a lower margin sales channel than
direct sales.

"On the other hand, we note that about two-thirds of iPayment's
revenues still come from the ISO channel and that the enlarged
group will also have a more variable cost base, since iPayment
and MCPS mainly outsource their core back-end processing, which
reduces operating leverage. We also note that iPayment has
experienced relatively high merchant attrition in recent years,
partly due to a significant concentration of small low-volume
merchants in its merchant base, which prompted strategic
investments in sales to attract larger merchants. While this has
begun to reduce attrition in 2017, we still see the exposure to
very small merchants as a key risk that Paysafe will need to
manage at the same time as the integration process. We also note
that about half of the combined group's pro forma gross profits
in 2017 will be represented by the digital wallets and prepaid
voucher products, in which Paysafe enjoys leading market
positions and greater margins but remains subject to significant
financial services regulation."

S&P's base-case scenario incorporates our following assumptions
pro forma the iPayment acquisition and excluding any potential
IFRS 15 impact:

-- Average growth in transaction values in the global electronic
    commerce market of about 15% over 2016-2021, and 5%-6% growth
    in the online gambling and digital gaming markets over 2016-
    2021 and 2016-2019, respectively.

-- Organic revenue growth of 6%-7% over 2018-2019 from just
    above 6% in 2017 (pro forma MCPS and Asia Gateway deals).
    This reflects growth in all segments supported by the wider
    market growth in transaction volumes and the potential to
    cross-sell Paysafe's online payment solutions and value-added
    services to MCPS' and iPayment's in-store merchant base. This
    also assumes contributions from ongoing bolt-on acquisitions
    in 2019.

-- Lower company-adjusted EBITDA margins of about 21.5% in 2018
    from about 27% in 2017, before increasing to 22%-23% in 2019.
    Following the initial margin dilution effect from the
    iPayment acquisition in 2018, margin expansion in 2019 is
    supported by assumed iPayment cost synergies of about $20
    million, total MCPS-related cost synergies of about $10
    million, IT-related cost savings, and operating leverage.

-- S&P Global Ratings-adjusted EBITDA margins of about 18.5% in
    2018 and 20%-21% in 2019 helped by declining restructuring,
    acquisition, and integration costs.

-- Reported capex of 3.0%-3.5% of sales over 2018-2019, down
    from about 5.5% in 2017 (pro forma MCPS and Asia Gateway) due
    mainly to the lower capex intensity of iPayment. Capex is
    assumed at about 1.5% of sales in 2018-2019 excluding
    capitalized development costs, which are expensed under our
    standard adjustments.

-- Cash tax rate of about 17% over 2018 and 2019.

-- Spending on bolt-on acquisitions of up to $100 million in
    2019.

Based on these assumptions, S&P arrives at the following adjusted
pro forma credit measures:

-- Debt to EBITDA of about 8.0x in 2018 and 6.6x-6.8x in 2019,
    from 8.6x in 2017.

-- Funds from operations (FFO) to debt of about 6% in 2018,
    increasing to 7.7%-7.9% in 2019, from 5.5% in 2017.

-- FOCF to debt of 4.7%-5.0% in 2018 and 6.1%-6.4% in 2019.

-- Excluding fees related to the LBO acquisition in December
    2017 and recent acquisitions, FOCF to debt of 5.3%-5.5% in
    2018 and 6.5%-7.0% in 2019.

-- EBITDA interest coverage of about 2.5x in 2018 and 2.7x-3.0x
    in 2019.

S&P said, "We assess liquidity as adequate, supported by
availability under the sizable RCF post-transaction, Paysafe's
good FOCF generation, and the bullet repayment structure of its
term loans. However, our view of the group's liquidity also
reflects the lack of a track record of maintaining a strong
liquidity profile under new financial sponsor ownership, limited
track record in public credit markets, and an acquisitive growth
strategy.

"On a pro forma basis, we expect sources of liquidity will exceed
uses by more than 4x in the 12 months from Dec. 31, 2017."

S&P forecasts the following principal liquidity sources over the
12 months from Dec. 31, 2017 pro forma the iPayment transaction:

-- Own cash of about $125 million, excluding transitory cash
    relating to the payments business, other restricted cash, and
    after payments in early 2018 related to the take-private
    transaction in December 2017;

-- $206 million of availability under an increased RCF of $225
    million; and

-- About $200 million of funds from operations.

S&P estimates the following principal liquidity uses over the
same period:

-- Annual scheduled debt amortization of about $16 million;
-- Capex of about $75 million, including capitalized development
    costs; and
-- Payments of cash-settled earn-outs of about $37 million.

S&P said, "We anticipate adequate covenant headroom of at least
30% under the springing-leverage-based test of the RCF in 2018.

"The stable outlook reflects our expectation that Paysafe will
experience good organic growth from positive market dynamics,
despite lower EBITDA margins of about 18.5% in 2018 from the
iPayment acquisition. This should lead to adjusted gross leverage
of about 8.0x in 2018, and FOCF to debt of above 5% (excluding
LBO and acquisition-related fees).  We could lower our rating if
FOCF-to-debt sustainably falls below 5% (excluding LBO or
acquisition-related fees) or interest coverage below 2x, combined
with gross leverage remaining above 7.5x.  This could occur if
EBITDA margins decline further than expected due to competitive
pressures on pricing, underperformance at iPayment, greater
implementation costs, or delays in the realization of cost
savings from the integration of recent acquisitions. This could
also be driven by further large debt-funded acquisitions or
aggressive capital structure changes, as well as unforeseen
adverse regulatory changes.  We view an upgrade scenario as
unlikely over the next 12 months due to the high leverage and our
view that the company will continue to seek acquisition related
growth.

"We could raise our rating in the long term if, on a sustained
basis, we expect FOCF-to-debt of at least about 10% and gross
leverage of below 6x, as well as a financial policy commitment to
maintain these levels."


SAMMON CONTRACTING: PJ McGrath Proposes to Invest EUR2.2MM
----------------------------------------------------------
Philip Connolly at The Sunday Times reports that the property
developer PJ McGrath, who is proposing to invest EUR2.2 million
in an examinership rescue of builder Sammon Contracting, plans to
construct almost 360 apartments in Dublin.

Randelswood Holdings, part of the Kildare-based McGrath Group,
has lodged plans with An Bord Pleanala for 305 apartments beside
Palmerstown Retail Park in west Dublin, The Sunday Times relates.
The company is seeking fast-track approval for the scheme, which
would be up to eight storeys, The Sunday Times states.

McGrath's company has also submitted plans to Dun Laoghaire-
Rathdown county council for 53 apartments in a four-storey block
in Dun Laoghaire, south Dublin, The Sunday Times notes.

According to The Sunday Times, McGrath is in talks with the
examiner to Sammon, which sought protection from its creditors
after suffering losses on a joint venture with the collapsed
Carillion group.


SBOLT 2018-1: Moody's Assigns (P)Ba2 Rating to Class D Notes
------------------------------------------------------------
Moody's Investors Service has assigned the following provisional
ratings to four classes of Notes to be issued by Small Business
Origination Loan Trust 2018-1 DAC:

GBP[128,070,000] Class A Floating Rate Asset-Backed Notes due
December 2026, Assigned (P)Aa3 (sf)

GBP[12,390,000] Class B Floating Rate Asset-Backed Notes due
December 2026, Assigned (P)A2 (sf)

GBP[14,460,000] Class C Floating Rate Asset-Backed Notes due
December 2026, Assigned (P)Baa2 (sf)

GBP[14,460,000] Class D Floating Rate Asset-Backed Notes due
December 2026, Assigned (P)Ba2 (sf)

Moody's has not assigned ratings to GBP[26,850,000] Class E
Floating Rate Asset-Backed Notes, GBP[14,460,000] Class X
Floating Rate Asset-Backed Notes and GBP[10,320,000] Class Z
Variable Rate Asset-Backed Notes which will also be issued by the
Issuer.

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

SBOLT 2018-1 is a securitization backed by a static pool of
GBP[206,572,566] of small business loans originated through
Funding Circle Limited's online lending platform. The loans were
granted to individual entrepreneurs and small and medium-sized
enterprises (SME) domiciled in UK. Funding Circle will act as the
Servicer and Collection Agent on the loans and P2P Global
Investments PLC will be the retention holder.

RATINGS RATIONALE

The ratings of the Notes are primarily based on the analysis of
the credit quality of the underlying loan portfolio, the
structural integrity of the transaction, the roles of external
counterparties and the protection provided by credit enhancement.
The ratings take into account, among other factors:

(i) a loan-by-loan evaluation of the underlying loan portfolio,
complemented by historical performance information as provided by
Funding Circle;

(ii) the structural features of the transaction, incorporating
relatively high credit enhancement from subordination, high
levels of excess spread compared to a conventional ABS SME
securitization, and the inclusion of an amortizing cash reserve
and non-amortizing liquidity reserve which provide both credit
and liquidity coverage over the life of the transaction;

(iii) the appointment of a back-up servicer at closing to
mitigate counterparty risk; and

(iv) the legal and structural integrity of the transaction.

In Moody's view, the strong credit positive features of this
transaction include, amongst others:

(i) a static portfolio with a short weighted average life of less
than 2 years;

(ii) certain portfolio characteristics, such as:

a) high granularity with low single obligor concentrations (for
example, the top individual obligor and top 10 obligor exposures
are 0.2% and 1.9% respectively) and an effective number above
1,800;

b) the loans' monthly amortisation; and

c) the high yield of the loan portfolio, with a weighted average
interest rate of 10.04%.

(iii) the transaction's structural features, which include:

(a) a cash reserve initially funded at 1.75% of the initial
portfolio balance, increasing to 2.75% of the initial portfolio
balance before amortising in line with the rated Notes; and

(b) a non-amortising liquidity reserve sized and funded at 0.25%
of the initial portfolio balance;

(c) an interest rate cap with a strike of 2% that provides
protection against increases on LIBOR due on the rated Floating
Rate Asset-Backed Notes.

(iv) no set-off risk, as obligors do not have deposits or
derivative contracts with Funding Circle.

However, Moody's Notes that the transaction has a number of
challenging features, such as

(i) potential misalignment of interest between the Originator and
the noteholders as the Originator does not retain a direct
economic interest in the transaction. This is partially mitigated
by the Seller acting as retention holder, and repurchase and
indemnification obligations of the Originator and the Seller in
case the representations and warranties are proven incorrect;

(ii) the short operating history of the Originator and Servicer
and the rapid growth of its origination volumes, without any
experience of a significant economic downturn;

(iii) relatively high industry concentrations as almost 40% of
the obligors belong to the top two sectors, namely Services:
Business (22%) and Construction & Building (17%), and the high
exposure to individual entrepreneurs and micro-SMEs (over 61% of
the portfolio); and

(iv) the loans are only collateralized by a personal guarantee,
and recoveries on defaulted loans often rely on the realization
of this personal guarantee via cashflows from subsequent business
started by the guarantor.

Key collateral assumptions:

Mean default rate: Moody's assumed a mean default rate of 11%
over a weighted average life of 1.9 years (equivalent to a B2
proxy rating as per Moody's Idealized Default Rates). This
assumption is based on:

(i) the available historical vintage data;

(ii) the performance of a previous transaction backed by loans
originated by Funding Circle; and

(iii) the characteristics of the loan-by-loan portfolio
information.

Moody's also took into account the current economic environment
and its potential impact on the portfolio's future performance,
as well as industry outlooks or past observed cyclicality of
sector-specific delinquency and default rates.

Default rate volatility: Moody's assumed a coefficient of
variation (i.e. the ratio of standard deviation over the mean
default rate explained above) of 50%, as a result of the analysis
of the portfolio concentrations in terms of single obligors and
industry sectors.

Recovery rate: Moody's assumed a 25% stochastic mean recovery
rate, primarily based on the characteristics of the collateral-
specific loan-by-loan portfolio information, complemented by the
available historical vintage data.

Portfolio credit enhancement: the aforementioned assumptions
correspond to a portfolio credit enhancement of 42%.

As of April 18, 2018, the loan portfolio of approximately GBP
206.6 million was comprised of 4,007 loans to 3,928 borrowers.
The average remaining loan balance stood at GBP 51,553, with a
weighted average fixed rate of 10.04%, a weighted average
remaining term of 44.7 months and a weighted average seasoning of
8.6 months. Geographically, the pool is concentrated mostly in
the South East (24.16%) and London (15.17%). The majority of the
loans were taken out by borrowers to fund the expansion or growth
of their business and each loan benefits from a personal
guarantee from (typically) the owner(s) of the business. At
closing, any loan more than 30 days in arrears will be excluded
from the final pool.

Key Transaction Structure Features:

Cash Reserve Fund: The transaction benefits from a cash reserve
fund initially funded at 1.75% of the initial portfolio balance,
increasing to 2.75% of the initial portfolio balance before
amortising in line with the rated Notes. The reserve fund
provides both credit and liquidity protection to the rated Notes.

Liquidity Reserve Fund: The transaction benefits from a separate,
non-amortising liquidity reserve fund sized and funded at 0.25%
of the initial portfolio balance. When required, funds can be
drawn to provide liquidity protection to the senior Notes.

Counterparty Risk Analysis:
Funding Circle (NR) will act as Servicer of the loans and
Collection Agent for the Issuer. Link Financial Outsourcing
Limited (NR) will act as a warm Back-Up Servicer and Collection
Agent.

All of the payments on loans in the securitised loan portfolio
are paid into a Collection Account held at Barclays Bank PLC (A2
/ P-1). There is a daily sweep of the funds held in the
Collection Account into the Issuer Account, which is held with
Citibank, N.A., London Branch (A1 / (P)P-1), with a transfer
requirement if the rating of the account bank falls below Baa2.

Parameter Sensitivities Analysis:

Moody's also tested other sets of assumptions under its Parameter
Sensitivities analysis. For instance, if the assumed default rate
of 11% used in determining the initial rating was changed to
12.5% and the recovery rate of 25% was changed to 20%, the model-
indicated rating for Class A would be unchanged, whilst the
model-indicated ratings for Classes B, C and D would be within
one notch of the base case rating.

Principal Methodology:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating SME Balance Sheet Securitizations"
published in August 2017.

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

The Notes' ratings are sensitive to the performance of the
underlying loan portfolio, which in turn depends on economic and
credit conditions that may change. The evolution of the
associated counterparties risk, the level of credit enhancement
and the UK's country risk could also impact the Notes' ratings.

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



                            *********

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

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

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


                            *********


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

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

Copyright 2018.  All rights reserved.  ISSN 1529-2754.

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

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

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


                 * * * End of Transmission * * *