/raid1/www/Hosts/bankrupt/TCREUR_Public/180615.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                          E U R O P E

            Friday, June 15, 2018, Vol. 19, No. 118


                            Headlines


C Z E C H   R E P U B L I C

CEFC EUROPE: CITIC Unit Seeks Approval of Czech Asset Takeover


D E N M A R K

DKT FINANCE: S&P Rates New EUR1.4BB-Equivalent Senior Notes 'B-'


F R A N C E

DELACHAUX SA: S&P Puts 'B+' Issuer Credit Rating on Watch Pos.


G R E E C E

AEOLOS SA: S&P Raises EUR355MM Class A Notes Rating to 'B (sf)'


N E T H E R L A N D S

ENDEMOL HOLDINGS: S&P Affirms CCC+ LT Credit Rating on Parent
STEINHOFF INT'L: Shareholders Sue Deloitte in Dutch Court
STEINHOFF INT'L: Moody's Withdraws Caa1 Corporate Family Rating
VTR FINANCE: S&P Affirms 'B+' Corp Credit Rating, Outlook Stable


P O R T U G A L

BCP FINANCE: S&P Raises Preference Shares Rating to 'CCC'


R U S S I A

CHUVASH REPUBLIC: Fitch Corrects June 8 Ratings Release
SRPSKA REPUBLIC: Moody's Assigns (P)B3 Sr. Unsec. Debt Rating


S P A I N

BANCA POPOLARE: Fitch Affirms 'BB+' LT IDR, Outlook Stable
TDA IBERCAJA 3: S&P Raises Rating on Class C Notes to BB+ (sf)
TDA IBERCAJA 4: S&P Affirms D (sf) Rating on Class F Notes
UCI 15: S&P Affirms B- (sf) Rating on Class C Notes


S W I T Z E R L A N D

EUROCHEM GROUP: Moody's Assigns Ba2 CFR, Outlook Stable


U N I T E D   K I N G D O M

ARQIVA BROADCAST: Fitch Affirms 'B-' High-Yield Bonds Rating
BHS GROUP: Lawmakers Want FRC to Divulge PwC Misconduct Details
CABOT FINANCIAL: S&P Alters Outlook to Pos. & Affirms 'B+' ICR
PUROGENIX LTD: Enters Administration, Buyer Sought for Business
SUNLINE DIRECT: Files Notice to Appoint Administrator


X X X X X X X X

* BOOK REVIEW: The First Junk Bond A Story of Corporate Boom


                            *********



===========================
C Z E C H   R E P U B L I C
===========================


CEFC EUROPE: CITIC Unit Seeks Approval of Czech Asset Takeover
--------------------------------------------------------------
Jan Lopatka at Reuters reports that Czech competition watchdog
UOHS said on June 13 a unit of China's state-owned conglomerate
CITIC has filed a request for antitrust approval to take full
control over Czech assets of troubled private Chinese group CEFC
China Energy.

According to Reuters, the Czech assets involved are the CEFC
Europe firm, holding interests in hotels, real estate,
engineering and a sports club and Lapasan, through which CEFC
holds a majority stake in beer brewer Lobkowicz.

UOHS said the CITIC entity filing the request was British Virgin
Islands-based Hengxin Enterprises Limited and it would take over
the Czech firms via Hong Kong-based Rainbow Wisdom Investments
Limited, Reuters relates.

The watchdog said no decision has been made in the matter,
Reuters notes.

Last month, CITIC stepped in to pay some CZK12 billion (US$549.05
million) debt owed by CEFC Europe to Czech financial group J&T,
Reuters recounts.


=============
D E N M A R K
=============


DKT FINANCE: S&P Rates New EUR1.4BB-Equivalent Senior Notes 'B-'
----------------------------------------------------------------
S&P Global Ratings assigned its 'B-' rating to the EUR1.4
billion-equivalent senior notes to be issued by DKT Finance ApS,
parent of Danish telecom operator TDC A/S (B+/Stable/B). S&P
said, "The recovery rating is '6', reflecting our expectation of
negligible recovery (rounded estimate 0%) in the event of a
payment default. The total amount will likely be split into a
euro tranche and a U.S. dollar tranche, and the relative size
will be determined during syndication. Our issue and recovery
ratings on TDC's outstanding instruments are unchanged."

RECOVERY ANALYSIS

Key analytical factors:

-- The issue rating on the proposed senior notes is 'B-', with a
    recovery rating of 6'. S&P expects recovery prospects to be
    negligible (at 0%), reflecting the notes' structural
    subordination to debt issued at TDC and to the EUR100 million
    super senior revolving credit facility at DKT Finance.

-- Debt incurrence is subject to a maximum net leverage ratio of
    5.3x and a general debt basket of EUR100 million at the
    consolidated group level (DKT Finance). Distributions are
    subject to a 5.3x consolidated net leverage test and a free
    floating basket of up to EUR375 million (or 32.5% of
    consolidated EBITDA) over the tenor of the facilities.

-- In S&P's simulated default scenario, it assumes that intense
    competition from other telecom operators in the broadband and
    mobile segments, paired with loss of TV customers to over-
    the-top services, would result in substantially lower EBITDA.
    Together with continued high capital expenditure (capex),
    this would lead to a hypothetical payment default in 2022.

-- S&P values DKT Holdings Aps, the ultimate parent of the
    group, as a going concern because it is the incumbent network
    operator in Denmark, with ownership of the leading mobile,
    fixed-line broadband, and cable-TV networks, and has an
    established position across all subsegments of the telecom
    services market.

Simulated default assumptions

-- Year of default: 2022

-- Minimum capex (share of sales): 6% (9%-10% including the
    operational adjustment, based on S&P's view of minimum capex
    requirements for cable and telecom operators)

-- No cyclicality adjustment, in line with our standard
    assumption for the telecom and cable industry

-- Operational adjustment: +15% (to reflect minimum capex higher
    than 6% of sales) EBITDA at emergence: about Danish krone
    (DKK) 5.0 billion (about EUR671 million)

-- Enterprise value multiple: 6.0x Jurisdiction: Denmark

Simplified waterfall

-- Gross enterprise value (EV) at default: about DKK29.8 billion
-- Net EV after administrative costs (5%): DKK28.3 billion
    (about EUR3.8 billion)
-- Priority claims: Nil
-- Estimated senior secured debt claims at TDC: DKK33.2 billion
    (about EUR4.5 billion) [1][2]
-- Value available for secured claims: DKK24.1 billion (about
    EUR3.2 billion)
    --Recovery prospects: 70%-90% (rounded estimate 70%)
-- Recovery rating: 2
-- Estimated senior unsecured debt claims at TDC: DKK7.6 billion
    (about EUR1.0 billion) [1]
-- Value available for unsecured claims: DKK4.2 billion (about
    EUR560 million)
    --Recovery prospects: 50%-70% (rounded estimate 55%)
-- Recovery rating: 3
-- Estimated senior debt claims at DKT Finance ApS: DKK11.4
    billion (about EUR1.5 billion) [1]
-- Value available for senior claims: Nil.
    --Recovery prospects: 0%-10% (rounded estimate 0%)
-- Recovery rating: 6

[1] All debt amounts include six months of prepetition interest.
[2] Revolving facilities assumed to be 85% drawn at default.


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


DELACHAUX SA: S&P Puts 'B+' Issuer Credit Rating on Watch Pos.
--------------------------------------------------------------
S&P Global Ratings said that it has placed its 'B+' long-term
issuer credit rating on French capital goods company Delachaux
S.A. on CreditWatch with positive implications.

S&P said, "We also put on CreditWatch positive our 'B+' rating on
the company's senior secured term loan and revolving credit
facility (RCF). The recovery rating is '4', indicating our
expectation of average recovery (rounded estimate: 40%) for
debtholders in the event of a default.

"We expect to withdraw the issue and recovery ratings once the
new capital structure is in place.

The CreditWatch placement follows Delachaux's recent announcement
that it intends to be listed on the Paris Stock Exchange, which
we understand could happen before the end of June 2018. If the
IPO is finalized as proposed, we believe it would enhance the
company's credit profile, through:

Lower absolute debt and a more relaxed debt maturity profile,
thanks to a new EUR450 million senior unsecured refinancing
package. Moreover, EUR100 million of equity proceeds and about
EUR100 million of cash on the balance sheet will be used to repay
debt currently outstanding. As of year-end 2017, Delachaux's
reported debt totaled about EUR655 million, linked almost
entirely to senior secured facilities taken in 2014. After the
proposed IPO, debt repayment, and refinancing, Delachaux's gross
debt is expected to consist of about EUR450 million of new senior
unsecured term loans due 2023. In addition, the company will
receive a new senior unsecured RCF of EUR75 million due 2023. We
understand the company will be subject to one leverage covenant
tested bi-annually from Dec. 31, 2018, implying net debt to
EBITDA below 4.0x, under which we expect Delachaux will have
ample headroom under the new capital structure. In the current
structure, the company is subject to a springing net leverage
covenant of 7.5x, which is tested only when drawings on the RCF
exceed 30% of the facility.

A change of the ownership structure, implying better visibility
and understanding of the company's future strategy and financial
policy. Currently CVC through its directly controlled subsidiary,
Financiäre Danube, holds close to 50% of Delachaux's share
capital. Some of the IPO proceeds will be used to reduce CVC's
stake to between 9.8% and 15% for six months after the company's
listing (lock-in period). We understand that the EUR230 million
payment-in-kind preference shares at Financiäre Danube will cease
to exist, leaving Delachaux's cash balance unaffected. This could
further enhance Delachaux's credit profile, since we previously
adjusted its reported debt for that amount. The listed entity,
named Delachaux Group, will merge with Delachaux S.A. After the
IPO, we expect CVC's stake will progressively reduce to zero,
while the Delachaux family will maintain a controlling stake of
slightly more than 50%. Moreover, the company has proposed a new
dividend policy of 35%-40% for 2019 and 2020. We will monitor the
new financial policy as part of the CreditWatch review. We
continue to think that Delachaux's business risk profile is
supported by the group's global positions in niche markets, which
feature high barriers to entry and an inherently stable revenue
base. According to the company's management, Delachaux is the
leader in all the markets it serves. In rail infrastructure, it
has a 20% market share in the fastening system sector, and a 45%
market share in the alumino thermic welding segment. Moreover, in
the diversified business segment, Delachaux is No. 1 in the
energy and data-management systems market with a share of about
20%, and has a 25% share of the chromium metal market.

Under our base case, we forecast Delachaux can maintain adjusted
EBITDA margins of 14%-15% in 2018, compared with the 14.8% it
reported in 2017, with revenue increasing by about 1% to about
EUR850 million, from EUR841 million last year. The company's
guidance is EUR900 million of sales in 2018. We believe the
revenue increase will be supported by some improvement in the
rail business, as well as new projects beyond maintenance, where
we anticipate growth of 1.5% year on year versus 2.3% in 2017. In
our base case, we've also incorporated small potential bolt-on
acquisitions, in line with the company's external growth
strategy, which should boost revenues further in 2019.

If the IPO, change of ownership, and refinancing go through as
planned, and the preferred notes at Financiäre Danube no longer
affect our adjusted debt calculations, we anticipate that
Delachaux's debt-protection metrics will improve, with adjusted
debt approaching EUR500 million compared with EUR957 million at
year-end 2017. We believe this would result in stronger debt-
metric forecasts for year-end 2018, with funds from operations
(FFO) to debt increasing to 13%-15% from 6%-8% and debt to EBITDA
reducing below 4x, compared with 7x-9x. This could lead us to
revise upward our assessment of Delachaux's financial risk
profile to aggressive from highly leveraged.

The CreditWatch indicates that we could raise the ratings by one
notch if the IPO and refinancing are completed in line with our
expectations. We aim to resolve the CreditWatch toward the end of
the year, after Delachaux's completion of the IPO, the new
capital structure, and decrease of CVC's stake to negligible
levels. An upgrade would also depend on the preferred shares at
Financiäre Danube, which are ultimately owned by CVC, being
removed from our adjusted debt calculations and delinked from
Delachaux. However, this is contingent on our assessment of
Delachaux's financial policy after the first few months of the
company's listing, and the company's operating performance and
the macroeconomic environment remaining supportive.

If the IPO does not take place as planned, and Delachaux's
capital and ownership structure are unchanged, we would likely
affirm our 'B+' rating.


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


AEOLOS SA: S&P Raises EUR355MM Class A Notes Rating to 'B (sf)'
---------------------------------------------------------------
S&P Global Ratings raised to 'B' from 'B-' its credit rating on
Aeolos S.A.'s EUR355 million floating-rate asset-backed class A
notes.

S&P said, "The upgrade of the class A notes follows our Jan. 19,
2018 raising to 'B' from 'B-' of our long-term sovereign rating
on Greece, which supports interest
and principal payments in Aeolos.

"Our counterparty criteria link our rating on Aeolos' class A
notes to our long-term sovereign rating on Greece as the
guarantor.

"Therefore, following our recent rating action on Greece, we have
consequently raised to 'B' from 'B-' our rating on Aeolos' class
A notes."

Aeolos is a Greek repack transaction. The underlying collateral
consists of receivables due from The European Organisation for
the Safety of Air Navigation for the provision of air traffic
control services in Greece.

  RATINGS LIST

  Aeolos S.A.
  EUR355 mil floating-rate asset backed notes
                                Rating
  Class       Identifier        To        From
  A           XS0140322743      B         B-


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


ENDEMOL HOLDINGS: S&P Affirms CCC+ LT Credit Rating on Parent
-------------------------------------------------------------
S&P Global Ratings affirmed its 'CCC+' long-term credit rating on
MediArena Acquisition B.V., the parent of Netherlands-based
Endemol Holdings B.V. and Endemol Shine Group (ESG). The outlook
is stable.

S&P said, "At the same time, we affirmed our 'CCC+' issue ratings
on the group's senior secured first-lien term debt due 2021. The
recovery rating is unchanged at '4', indicating our expectation
of average recovery (30%-50%; rounded estimate 45%) in the event
of payment default.

"We also affirmed our issue rating on the $457 million second-
lien term loan maturing in 2022 at 'CCC-'. The recovery rating is
unchanged at '6', indicating negligible recovery prospects (0%).

"The affirmation reflects our view that ESG's credit metrics will
remain weak in 2018. Its S&P Global Ratings-adjusted debt to
EBITDA will be about 9x, it will report negative free operating
cash flow (FOCF), and its capital structure is unsustainable over
the long term. Nevertheless, we don't expect the group to face a
near-term credit or payment crisis over the next 12 months."

ESG is the largest independent TV content producer globally. S&P
said, "We expect it to maintain its leading positions in the
U.S., U.K., and a number of other European markets by delivering
successful scripted and nonscripted shows. Global demand for
high-quality content remains strong and is driven by audience
fragmentation and intensifying competition between traditional
broadcasters, pay-TV, and over-the-top (OTT) players, such as
Amazon and Netflix. ESG has long-standing relationships with
major broadcasters and new market entrants, and in our view is
less exposed to concentration risk associated with its largest
customers than its smaller peers."

ESG primarily focuses on nonscripted shows, which account for
about 70% of its revenues and EBITDA. The group's overall
performance is largely reliant on its long-lasting superbrands,
such as Big Brother and Master Chef. Over the past couple of
years, ESG has developed a number of new nonscripted formats in
various genres that have proven able to travel well
internationally. It has also produced several major scripted
hits, such as Black Mirror and Peaky Blinders, which have
recently been recommissioned for new seasons. In 2016-2017, it
moved into producing more scripted drama, which has weighed on
the group's profitability and cash flows because it usually has
longer payback periods, initially provides lower margins, and is
more capital-intensive. Scripted drama is in particularly high
demand, so S&P expects this expansion will continue in 2018,
albeit at a slower pace.

S&P said, "We expect ESG's earnings, cash flows, and credit
metrics will remain volatile, reflecting the nature of the
industry and uneven schedules associated with commissioning and
delivering the shows, which can often be delayed by one quarter
or more.

"Given that we forecast an only modest improvement in adjusted
EBITDA margins and negative FOCF in 2018-2019, we don't expect
any material reduction in leverage. Adjusted debt to EBITDA of
about 9.0x makes the group's capital structure unsustainable in
the long term. In the short term, our analysis focuses on how the
group manages its liquidity."

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

-- Revenue growth of about 1%-2% per year from EUR1.9 billion in
    2017, fueled by strong global demand for content, which is
    not directly correlated with macroeconomic indicators. S&P
    notes that the group's earnings and cash flows will remain
    lumpy due to potential delays in commissioning and scheduled
    broadcasting of the shows.

-- Reported EBITDA margins to remain fairly stable, reflecting
    the lower profitability of the newly developed scripted shows
    compared with nonscripted ones.

-- Adjusted EBITDA margins to gradually improve to about 11% in
    2019 from 10% in 2017, assuming the phasing-out of
    restructuring and integration costs.

-- Working capital outflows of about EUR20 million-EUR30 million
    per year due to the group's increasing production of scripted
    shows.

-- Capital expenditure (capex) of about EUR15 million annually.

-- No merger and acquisition (M&A) or shareholder returns due to
    the group's stretched liquidity position and high leverage.

Based on this, S&P arrives at the following credit measures:

-- Adjusted debt to EBITDA of about 9x; EBITDA interest cover of
    about 1.0x-1.5x; and

-- Negative FOCF.

S&P said, "The stable outlook reflects our view that over the
next 12 months ESG will see a modest improvement in EBITDA
generation due to strong global demand for its content, but free
cash flow will be negative and the group's capital structure will
remain unsustainable in the long term. We forecast adjusted debt
to EBITDA will be very high at about 9x, and liquidity will
remain constrained by substantial short-term maturities and
working capital needs, and covenant headroom will be tight,
although we don't expect ESG to face a credit or payment crisis
in the next 12 months.

"We could lower the rating if we believed that the group's
probability of default had increased, especially if we saw a risk
of insufficient liquidity or covenant breach. This could happen
if the group faced unexpected shortfalls in revenue or cash flows
due to delayed delivery of its shows, or if the working capital
needs increased beyond our current expectations.

"We view an upgrade as unlikely over the next 12 months, given
the group's currently very high leverage and weak liquidity. Over
the longer term, we could raise the rating if the group
meaningfully improved its EBITDA generation and free operating
cash such that leverage sustainably reduces; EBITDA interest
cover exceeds 1.5x; and liquidity improves such that cash and
undrawn committed facilities comfortably cover upcoming short-
term debt maturities and shortfalls in free cash flows."


STEINHOFF INT'L: Shareholders Sue Deloitte in Dutch Court
---------------------------------------------------------
Joseph Cotterill at The Financial Times reports that shareholders
in Steinhoff on June 13 sued Deloitte for damages in a Dutch
court, accusing the auditor of failures in the accounting scandal
that brought the South Africa-based global retailer to the brink
of collapse.

VEB, the Dutch investor rights group, said it brought the lawsuit
in the Rotterdam district court as Deloitte had "seriously failed
in its statutory task as auditor" by giving an unqualified audit
to Steinhoff before the owner of the UK's Poundland and Mattress
Firm in the US revealed a black hole of more than EUR5 billion in
its accounts, the FT relates.

Revelation of the irregularities in December last year wiped more
than EUR14 billion from the market value of Johannesburg- and
Frankfurt-listed Steinhoff, plunging many of its subsidiaries
into a credit crisis and leading to an investigation, which is
still continuing, into the scale of the losses, the FT recounts.

According to the FT, Steinhoff said in March an investigation by
PwC of the irregularities, focused on the company's eastern
European property portfolio, has also extended to the group cash
pile.

Steinhoff, the FT says, is still battling to push through a
restructuring of more than EUR10 billion in debt in order to
survive.  On June 12 the company, as cited by the FT, said it had
received enough support from creditors not to enforce their
rights while it continues negotiations.  The standstill expires
on June 30, the FT relays.

Steinhoff said the group "remains in constructive discussions"
with its lenders, the FT notes.


STEINHOFF INT'L: Moody's Withdraws Caa1 Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service withdrew Steinhoff International
Holdings N.V.'s (Steinhoff) Caa1 Corporate Family Rating (CFR)
and Caa1-PD probability of default rating (PDR) and Steinhoff
Investment Holdings Limited's Caa1/B3.za CFR and Caa1-PD PDR. At
the same time Moody's withdrew the rating on the EUR800 million
1.875% senior unsecured notes due 2025 issued by Steinhoff Europe
AG.

RATINGS RATIONALE

Moody's has decided to withdraw the ratings because it believes
it has insufficient or otherwise inadequate information to
support the maintenance of the ratings.

The withdrawal of the ratings was predicated on the following (1)
insufficient independently verifiable financial information due
to accounting irregularities which have still not been resolved
pending the outcome of a PwC investigation; and (2) the issuer's
decision to cease participation in the rating process.


VTR FINANCE: S&P Affirms 'B+' Corp Credit Rating, Outlook Stable
----------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' corporate credit rating on
VTR Finance B.V. (VTR). The outlook is stable. S&P also affirmed
our 'B+' issue-level rating on VTR's $1.4 billion senior secured
notes due 2024.

The ratings affirmation reflects the company's stable and
consistent performance, which we expect to continue during the
next two years. S&P said, "We believe VTR will remain an
important player in the cable and telecommunication market in
Chile, especially in the pay TV and fixed broadband segment.
Given that there's still room to grow broadband access in the
Chilean market, we believe VTR will have sustained subscription
growth and stable profitability, leading to predictable revenue
and cash flow generation. Despite debt levels slightly
increasing, we forecast VTR's debt to EBITDA to remain between
3.5x and 4.0x in the next two years. During the same time period,
the company will continue posting weak free operating cash flow
(FOCF) to debt (below 5%), due to considerable capital
expenditures (capex) to support growth through network build-up."

VTR recently secured a five-year term loan for CLP174 billion.
S&P said, "We believe the company could use part of these funds
for liability management, and it could upstream the rest to its
parent, Liberty Latin America (LLA; not rated). Since we expect
VTR's EBITDA to grow gradually, we believe the company can absorb
slightly higher levels of debt without hurting its leverage
metrics."


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


BCP FINANCE: S&P Raises Preference Shares Rating to 'CCC'
---------------------------------------------------------
S&P Global Ratings said that it has raised to 'CCC' from 'D' its
issue rating on the EUR500 million perpetual non-cumulative
guaranteed non-voting step-up preference shares (Series C) issued
by BCP Finance Company and guaranteed by Banco Comercial
Portugues S.A. (Millennium bcp).

The issue has the ISIN number XS0194093844 and an outstanding
amount of EUR43.97 million.

RATIONALE

The rating action follows Millennium bcp's resumption of the
dividend payment on its EUR500 million legacy preference shares
Series C on the due date of June 12, 2018. Since June 9, 2012,
the bank has missed all coupon payments on these instruments
because it did not have sufficient distributable items capacity.

S&P understands that after the approval of its 2017 audited
results on April 23, 2108, Millennium bcp asked the European
Central Bank (ECB) for authorization to resume the payment of
coupons on its outstanding preference shares. Millennium bcp
obtained this permission on June 5.

The 'CCC' rating we are assigning to the preference shares stands
five notches below the bank's stand-alone credit profile,
reflecting:

-- Subordination risk (the standard two-notch adjustment for
    non-investment grade issuers);

-- Discretionary coupon non-payment (two notches for legacy Tier
    1 instruments that are now subject to Basel III or equivalent
    rules); and

-- The risk of common-equity conversion or a principal write-
    down that the legal framework might enforce.

S&P said, "We do not apply any additional notching because we do
not consider there is any further non-payment risk on these notes
that we do not already factor into the 'CCC' rating.

"We view Millennium bcp's resumption of dividend payments on its
preference shares as a positive step toward normalization that
came after the bank, in 2017, successfully completed a capital
increase, repaid to the state the remaining contingent
convertible securities, and turned its profitability around. We
anticipate the more sustained economic recovery and moderate
decrease in credit losses in Portugal will likely help Millennium
bcp gradually increase the profitability of its domestic
operations, which turned positive in 2017.

"We currently rate at 'D' another Tier 1 legacy hybrid instrument
issued by BCP Finance Company and guaranteed by Millennium bcp:
the EUR500 million Series D perpetual non-cumulative guaranteed
non-voting step-up preference shares (ISIN: XS0231958520). This
issue, on which the bank has missed annual coupon payments since
Oct. 13, 2012 and has not resumed since, has an outstanding
amount of EUR15.94 million. We believe it is likely that
Millennium bcp will also resume coupon payment on this hybrid
instrument. However, we will wait until the next coupon payment
due on July 13, 2018, before taking any rating action.

"On April 19, 2018, we published new criteria for assigning
resolution counterparty ratings (RCRs) to certain financial
institutions. We consider that there is an effective resolution
regime in Portugal, and that an RCR may be relevant to Millennium
bcp under these criteria. In the coming weeks, we will be
reviewing our analysis of the resolution regime across several
countries, including Portugal. This review will identify
liability categories, if any, that are protected from default
risk by structural or operational features of a given resolution
framework. On completion of this review, we may assign RCRs under
our new criteria to banks located in Portugal, including
Millennium bcp."

  RATINGS LIST

  Upgraded
                                      To                 From
  BCP Finance Co.
   Preference Stock (Series C)        CCC                D
   ISIN number XS0194093844

  Ratings Affirmed

  BCP Finance Co.
   Preference Stock (Series D)        D                  D
   ISIN: XS0231958520


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


CHUVASH REPUBLIC: Fitch Corrects June 8 Ratings Release
-------------------------------------------------------
Fitch Ratings replaced a ratings release published on June 8,
2018 to remove reference to senior unsecured debt.

The revised release is as follows:

Fitch Ratings has affirmed the Russian Chuvash Republic's
(Chuvashia) Long-Term Foreign- and Local-Currency Issuer Default
Ratings (IDRs) at 'BB+' with Stable Outlooks and Short-Term
Foreign-Currency IDR at 'B'.

The affirmation reflects the republic's sound fiscal performance
and moderate direct risk. This is balanced by the modest size of
the republic's economy and budget leading to a limited fiscal
capacity. The ratings also factor in the region's low fiscal
flexibility due to a high dependence on the federal authorities
for budgetary decisions amid a weak institutional framework for
Russian subnationals.

KEY RATING DRIVERS

Budgetary Performance (Neutral/Stable)

Fitch expects Chuvashia to continue its sound fiscal performance
in 2018, with an operating margin close to the high average of
18.4% in 2016-2017. Improvement was driven by growth of corporate
income tax proceeds on the back of economic recovery and a
significant increase in transfers from the federal government.
The latter was due to a new formula of general purpose grants
allocation and higher earmarked transfers for co-financing salary
increase.

In the longer term, Fitch expects the operating margin will
weaken to a still sound 12%-13% as higher operating expenditure
outpaces growth of operating revenue. Among others operating
spending will be fuelled by higher staff cost following the
recent federal government decision to increase minimal salary to
subsistence level.

Chuvashia's exceptionally strong fiscal performance in 2016-2017
led to a surplus budget, after deficits averaging 5.7% of total
revenue in 2012-2015. According to Fitch's base case scenario,
the region will record a moderate deficit before debt variation
of 2%-3% in the medium term.

The moderate size of the republic's local economy and budget
results in a smaller tax capacity and ability to absorb potential
shocks than national peers. This leads to the region's high
reliance on federal transfers remaining steady; the latter
constitutes a third of Chuvashia's operating revenue annually.

Debt and Liquidity (Neutral/Stable)

Fitch forecasts the region's direct risk should remain moderate
at below 40% of current revenue (2017: 35.4%) over the medium
term and that the direct risk-to-current balance should
consolidate at two-to-three years, compared with an average of
five years in 2011-2015. Fitch believes that the expected 2018
deficit will likely be covered by the republic's cash balance of
RUB2.6 billion (as of January 1, 2018). Fitch projects that
direct risk will grow moderately to about RUB15.5 billion by end-
2020 (2017: RUB14 billion).

Chuvashia's direct risk profile is dominated by low-cost budget
loans, which reached 98% as of May 1, 2018 (end-2017: 55%),
allowing the region to save on interest payments. As they mature
budget loans as a share of direct risk will likely decline to 50%
in the medium term. They will be refinanced by market debt (bonds
and bank loans), which will add pressure to debt servicing and
refinancing needs, in Fitch's view.

At end-2017, the maturity of outstanding budget loans was
restructured under a programme initiated by the federal
government at end-2017. The maturity of RUB6.7 billion budget
loans received by the region in 2015-2017 has been extended to
2024, with most of the payments in 2021-2024.

Management (Neutral/Stable)

In general, the republic's budgetary policy is strongly dependent
on the decisions of the federal authorities and has low
flexibility both in revenue and expenditure. In mitigation the
administration follows a prudent and conservative budgetary
policy, which is manifested in a moderate debt burden. The
administration intends to narrow the region's fiscal deficit and
gradually reduce debt relative to revenue in the medium term, in
line with a bilateral agreement with the federal Ministry of
Finance.

Economic (Weakness/Stable)

Chuvashia is a medium-sized region in the eastern part of
European Russia with population of 1.231 million residents. The
republic's socio-economic profile is historically weaker than
that of the average Russian region. Its per capita GRP was 62% of
the national median in 2015. According to preliminary estimates,
the republic's economy marginally grew in 2016 after a 2.7%
contraction in 2015, which is in line with the national economic
trend. Fitch expects the Russian economy will continue its
moderate recovery with 2% GDP growth per annum in 2018-2019, and
Chuvash will likely follow this trend.

Institutional Framework (Weakness/Stable)

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 continuing reallocation
of revenue and expenditure responsibilities within government
tiers.

RATING SENSITIVITIES

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

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


SRPSKA REPUBLIC: Moody's Assigns (P)B3 Sr. Unsec. Debt Rating
-------------------------------------------------------------
Moody's Public Sector Europe assigned a provisional senior
unsecured debt rating of (P)B3 to Republic of Srpska's (Srpska)
planned EUR200 million bond.

RATINGS RATIONALE

The (P)B3 debt rating reflects the B3 issuer rating, Stable
Outlook of Srpska. Under the provided (preliminary)
documentation, the planned debt will be direct, unsecured,
unconditional and unsubordinated obligations of the issuer.

The B3 stable issuer rating of Srpska reflects its high degree of
financial and legislative autonomy. This allows Srpska to record
consistently adequate budgetary performance through its active
fiscal management. Srpska's gross operating balance (GOB) of 11%
of operating revenues in 2017 compares favorably with similar
rated peers. Srpska's rating is constrained by a high debt burden
(166% of operating revenues) and pressure stemming from
considerable capital spending requirements. The planned debt is
expected to be used for refinancing of existing debt and
therefore is not expected to impact the current debt metrics of
Srpska. The rating also includes a low likelihood that the
Government of Bosnia and Herzegovina (B3 stable) would provide
support if the republic was to face acute liquidity stress.

The (provisional) rating is assigned based on the draft
documentation received by Moody's as of the rating assignment
date. In the event that the debt structure changes significantly
from the documentation submitted, Moody's will assess any
potential impact on the ratings.

WHAT COULD CHANGE THE RATING UP / DOWN

An upgrade of Bosnia and Herzegovina's sovereign rating could
result in upward pressure on Srpska's rating. In addition, an
evidence of Srpska's ability for continued improvement of its
operating and financial performance and gradual reduction in its
debt burden could exert upward rating pressure. A downgrade of
Bosnia and Herzegovina's sovereign rating could lead to a similar
action on Srpska's rating. In addition, a significant
deterioration in financial performance and an increase in debt
levels may exert downward rating pressure.

The first-time assignment of a (provisional) senior unsecured
debt rating required the publication of this rating action on a
date that deviates from the previously scheduled release date in
the sovereign release calendar.

The specific economic indicators, as required by EU regulation,
are not available for Republic of Srpska. The following national
economic indicators are relevant to the sovereign rating, which
was used as an input to this credit rating action.

Sovereign Issuer: Bosnia and Herzegovina, Government of

GDP per capita (PPP basis, US$): 12,724 (2017 Actual) (also known
as Per Capita Income)

Real GDP growth (% change): 3.2% (2017 Actual) (also known as GDP
Growth)

Inflation Rate (CPI, % change Dec/Dec): 1.6% (2017 Actual)

Gen. Gov. Financial Balance/GDP: 1.9% (2017 Actual) (also known
as Fiscal Balance)

Current Account Balance/GDP: -4.8% (2017 Actual) (also known as
External Balance)

External debt/GDP: [not available]

Level of economic development: Low level of economic resilience

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

SUMMARY OF MINUTES FROM RATING COMMITTEE

On June 8, 2018, a rating committee was called to discuss the
rating of the Srpska, Republic of. The main points raised during
the discussion were: The issuer's fiscal or financial strength,
including its debt profile, has not materially changed.

The principal methodology used in this rating was Regional and
Local Governments published in January 2018.


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


BANCA POPOLARE: Fitch Affirms 'BB+' LT IDR, Outlook Stable
----------------------------------------------------------
Fitch Ratings has affirmed Banca Popolare dell'Alto Adige's
(Volksbank) Long-Term Issuer Default Rating (IDR) at 'BB+' and
Viability Rating (VR) at 'bb+'. The Outlook on the Long-Term IDR
is Stable.

KEY RATING DRIVERS

IDRS AND VR

The ratings of Volksbank reflect its profile as an adequately-
managed regional bank operating with a less diversified business
model than larger domestic players and some of its direct peers.
The ratings further reflect its reasonable risk appetite and
capitalisation, plans to improve its asset quality to more
adequate levels, and less diversified funding sources than higher
rated peers.

The bank's moderate franchise in the wealthy region of Trentino
Alto Adige, particularly in the bank's home province of Bolzano,
has allowed Volksbank to tolerate the effect of low interest
rates and economic slowdown better than a number of domestic
peers. Volksbank, however, lacks critical mass in core banking
activities at a national level, despite its more recent expansion
in the Veneto Region, and cannot effectively compete with larger
and stronger domestic players outside of its reference
territories, in Fitch's opinion.

In 2017 Volksbank accelerated reduction in its non-performing
loans (NPLs) by means of disposals and recoveries that improved
its impaired loans ratio to 12.8% at end-2017 from over 15.8% at
end-2016. The bank is committed to returning to its historical
low levels of impaired loans, which before the acquisition of
Banca Popolare di Marostica (Marostica) had remained below 10% of
gross loans. Volksbank's targets are achievable, in Fitch's view,
but execution risk is highly sensitive to market confidence and
the economic cycle. New inflows of impaired loans decreased
during 2017 and Fitch expects the bank to maintain NPL formations
under control and in line with its low risk appetite. Its
coverage ratio at 49% at end-2017 is weak relative to peers' but
is partially mitigated by ample collateral and its NPLs being, on
average, less seasoned.

The Fitch Core Capital (FCC) ratio at 12.3% and reduced
encumbrance of unreserved impaired loans at 65% of FCC at end-
2017 (83% at end-2016) compare well in its universe of domestic
rated peers but remain weak by international comparison. Fitch
expects the unreserved impaired loans/FCC ratio to reduce
gradually in the medium-term, reflecting improved asset quality
prospects, while stable earnings retention should support stable
capital levels. Volksbank's CET1 ratio and Basel III leverage
ratio are maintained with satisfactory buffers over minimum
regulatory requirements. In 2017 the inaugural issuance of Tier 2
notes strengthened the bank's total capital ratio; which at 13.6%
provides moderate buffers against the bank's 2018 Supervisory
Review and Evaluation Process requirement.

In 2017 operating profitability benefitted from Volksbank's
ability to develop commission income and reduce funding costs.
Contribution from loans to customers continued to be negatively
impacted by the low interest rates despite growing volumes. Fitch
expects net interest income to remain under pressure in the
current interest rate environment and sensitive to the bank's
ability to keep its cost of funding under control. The
cost/income ratio decreased below pre-acquisition levels to about
61% at end-2017, despite a rather sticky cost base. Loan
impairment charges (LICs) accounted for over 68% of pre-
impairment profit at end-2017, which remains high compared with
the level before the acquisition of Marostica (around 50% at end-
2014) but also relative to peers. The weight of LICs should
reduce gradually in the medium-term, reflecting improved asset
quality prospects.

Volksbank is predominantly retail-funded and benefits from a
stable customer deposit base. Its loans/customer deposit ratio at
about 119% at end-2017 is higher than domestic peers' but it has
been improving over time, reflecting sustained deposit growth.
Wholesale funding is mainly represented by central bank
facilities, which to date Volksbank has used opportunistically
rather than for liquidity needs. Access to institutional
investors has been limited to date, primarily through the
issuance of RMBS and more recently subordinated funding; however,
the bank's strategy is aimed at moderately increasing funding
diversification, also to meet its minimum requirement for own
funds and eligible liabilities. Liquidity is maintained with
adequate buffers, although slightly tighter than at other medium-
sized banks.

SUPPORT RATING AND SUPPORT RATING FLOOR

The bank's Support Rating and Support Rating Floor reflect
Fitch's view that senior creditors cannot rely on receiving full
extraordinary support from the sovereign if a bank becomes non-
viable. The EU's Bank Recovery and Resolution Directive and the
Single Resolution Mechanism for eurozone banks provide a
framework for resolving banks that requires senior creditors to
participate in losses, if necessary, instead of, or ahead of, a
bank receiving sovereign support.

SUBORDINATED DEBT

Tier 2 subordinated debt is rated one notch below the VR for loss
severity to reflect Fitch's expectation of below-average recovery
prospects. No notching is applied for incremental non-performance
risk because write-down of the notes will only occur once the
point of non-viability is reached and there is no coupon
flexibility before non-viability.

RATING SENSITIVITIES

IDRS AND VR

Volksbank's company profile, notably the bank's moderate
franchise, means upside for the VR and IDRs is limited. Over time
the ratings could be upgraded if the bank shows a consistent
record in reducing both its impaired loans and the share of
unreserved impaired loans in relation to capital. Evidence of
stronger and more stable profitability and more diversified
funding, through more regular access to secured and unsecured
institutional markets, would also benefit the ratings.

The ratings would be downgraded if Volksbank fails to maintain
its asset quality under control and profitability at acceptable
and sustainable levels. Negative rating pressure could also arise
if the bank's funding and liquidity deteriorate or from a change
in risk appetite (eg. excessive growth not accompanied by the
necessary internal capital generation or evolution in controls).

SUPPORT RATING AND SUPPORT RATING FLOOR

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

SUBORDINATED DEBT

The subordinated debt's rating is primarily sensitive to changes
in the VR, from which it is notched. The rating is also sensitive
to a change in the notes' notching, which could arise if Fitch
changes its assessment of their non-performance relative to the
risk captured in the VR or their expected loss severity.

The rating actions are as follows:

Long-Term IDR: affirmed at 'BB+', Outlook Stable

Short-Term IDR: affirmed at 'B'

Viability Rating: affirmed at 'bb+'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

Subordinated notes: affirmed at 'BB'


TDA IBERCAJA 3: S&P Raises Rating on Class C Notes to BB+ (sf)
--------------------------------------------------------------
S&P Global Ratings raised and removed from CreditWatch positive
its credit ratings on TDA Ibercaja 3 Fondo de Titulizacion de
Activos' class A and C notes. At the same time, S&P affirmed and
removed from CreditWatch positive its 'BB+ (sf)' rating on the
class B 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 swap provider in this transaction."

The servicer, Ibercaja Banco S.A. has a standardized, integrated,
and centralized servicing platform. It is a servicer for a large
number of Spanish residential mortgage-backed securities (RMBS)
transactions, and the historical performance of the Ibercaja
Banco transactions has outperformed our Spanish RMBS index.

The swap counterparty is Banco Santander. Considering the
remedial actions defined in the swap counterparty agreement, and
the current ICR, the maximum rating on the notes in this
transaction is now two notches higher, or 'AAA (sf)', than at
S&P's previous review.

S&P said. "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 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 foreclose frequency for each
rating level compared with our previous review, mainly driven by
our revised foreclosure frequency assumptions."

  Rating level     WAFF (%)    WALS (%)
  AAA                 14.26       12.91
  AA                  9.80         9.56
  A                   7.36         5.12
  BBB                 5.46         3.27
  BB                  3.62         2.24
  B                   2.19         2.00

TDA Ibercaja 3's class A, B, and C notes' credit enhancement has
increased to 9.7%, 3.1%, and 1.6%, respectively, due to the
notes' amortization, which is pro rata, and the reserve fund
being at its required and floor level.

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 European residential loans criteria,
reflecting our updated credit figures, indicates that the
available credit enhancement for the class A notes is
commensurate with a 'AA+' rating. However, 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 'A+ (sf)' and removed
from CreditWatch positive our rating on the class A notes.

"Our European residential loans criteria, including our updated
credit figures, indicate that the available credit enhancement
for the class B notes is still commensurate with a 'BB+ (sf)'
rating, excluding the application of a commingling loss.
Consequently, our rating on this class of notes is linked to our
long-term ICR on the servicer, Ibercaja Banco (BB+/Positive/B).
We have therefore affirmed and removed from CreditWatch positive
our 'BB+ (sf)' rating on the class B notes. Our RAS criteria do
not cap our ratings on this class of notes as the highest
achievable rating is lower than our sovereign rating.

"We have raised and removed from CreditWatch positive our rating
on the class C notes as the credit enhancement for this class of
notes is commensurate with the stresses we apply at a higher
level than that currently assigned. Our rating on the class C
notes is linked to our long-term ICR on the servicer, Ibercaja
Banco (BB+/Positive/B), as in our cash flow analysis we are
excluding the application of a commingling loss. Our RAS criteria
do not cap our rating on this class of notes as the highest
achievable rating is lower than our sovereign rating."

TDA Ibercaja 3 is a Spanish RMBS transaction that closed in May
2006. The transaction securitizes residential loans originated by
Ibercaja Banco, which were granted to individuals for the
acquisition of their first residence, mainly concentrated in
Madrid and Aragon, Ibercaja Banco's main markets.

  RATINGS LIST

  Class             Rating
              To               From

  TDA Ibercaja 3, Fondo de Titulizacion de Activos EUR1.007
  Billion Mortgage-Backed Floating-Rate Notes

  Ratings Raised And Removed From CreditWatch Positive

  A           AA(sf)           A+ (sf)/Watch Pos
  C           BB+ (sf)         BB (sf)/Watch Pos

  Rating Affirmed And Removed From CreditWatch Positive

  B           BB+ (sf)         BB+ (sf)/Watch Pos


TDA IBERCAJA 4: S&P Affirms D (sf) Rating on Class F Notes
----------------------------------------------------------
S&P Global Ratings took various rating actions in TDA Ibercaja 4
Fondo de Titulizacion de Activos.

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 swap provider in this transaction.

The servicer, Ibercaja Banco S.A. has a standardized, integrated,
and centralized servicing platform. It is a servicer for a large
number of Spanish residential mortgage-backed securities (RMBS)
transactions, and the historical performance of the Ibercaja
Banco transactions has outperformed our Spanish RMBS index.

"The swap counterparty is Banco Santander. Considering the
remedial actions defined in the swap counterparty agreement, and
the current ICR, the maximum rating on the notes in this
transaction is now two notches higher, or 'AAA (sf)', than at our
previous review.

"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 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 foreclose frequency (WAFF) for
each rating level compared with our previous review, mainly
driven by our revised foreclosure frequency assumptions."

  Rating level     WAFF (%)    WALS (%)
  AAA                 17.57       17.58
  AA                  12.15       14.30
  A                    9.20        9.45
  BBB                  6.88        7.10
  BB                   4.60        5.58
  B                    2.82        4.31

TDA Ibercaja 4's class A1, A2, B, C, D, and E notes' credit
enhancement has slightly increased to 12.7% (for both the A1 and
A2 notes), 10.2%, 5.3%, 3.2%, and 1.7%, respectively, due to the
notes' pro-rata amortization, and the reserve fund being at its
required and floor level.

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 European residential loans criteria and
related credit and cash flow analysis indicates that the
available credit enhancement for the class A1 notes is
commensurate with a 'AAA (sf)' rating. Furthermore, under our RAS
criteria, this class of notes can be rated up to six notches
above our unsolicited 'A-' long-term sovereign rating on Spain.
In addition, the swap counterparty no longer constrains our
rating on the notes. We have therefore raised to 'AAA (sf)' from
'AA+ (sf)' and removed from CreditWatch positive our rating on
the class A1 notes.

"The application of our European residential loans criteria,
reflecting our updated credit figures, indicates that the
available credit enhancement for the class A2 notes is
commensurate with a 'AA' rating. Because of the pro rata trigger
between the class A1 and A2 notes, which is based on the ratio of
outstanding defaulted assets over original balance representing
more than 4%, we expect the class A2 payments to remain
subordinated to the class A1 notes given the transaction's
historical performance. As such, the application of our RAS
criteria caps our rating on the class A2 notes at four notches
above our unsolicited 'A-' long-term sovereign rating on Spain.
We have therefore raised to 'AA (sf)' from 'A+ (sf)' and removed
from CreditWatch positive our rating on the class A2 notes.

"The application of our European residential loans criteria,
reflecting our updated credit figures, indicates that the
available credit enhancement for the class B and C notes is
commensurate with the 'AA- (sf)' and 'BBB+ (sf)' ratings,
respectively. We have therefore raised to 'AA- (sf)' and 'BBB+
(sf)' from 'BBB+ (sf)' and 'BB+ (sf)' and removed from
CreditWatch positive our ratings on the class B and C notes,
respectively. Our ratings on the class C notes are no longer
linked to our long-term ICR on the servicer, Ibercaja Banco
(BB+/Positive/B), as in our cash flow analysis we have applied a
commingling loss at the 'BBB-' rating stress level and above.

"Our European residential loans criteria, including our updated
credit figures, indicate that the available credit enhancement
for the class D notes is still commensurate with a 'BB+ (sf)'
rating. Our rating on the class D notes is linked to our long-
term ICR on the servicer, Ibercaja Banco (BB+/Positive/B), as in
our cash flow analysis we are excluding the application of a
commingling loss. Consequently, our rating on this class of notes
is linked to our long-term ICR on the servicer, Ibercaja Banco.
We have therefore affirmed and removed from CreditWatch positive
our 'BB+ (sf)' rating on the class D notes. Our RAS criteria do
not cap our ratings on this class of notes as the highest
achievable rating is lower than our sovereign rating.

"We have raised our rating on the class E notes as the credit
enhancement for this class of notes is commensurate with the
stresses we apply now at a higher level than that currently
assigned. Our rating on the class E notes is linked to our long-
term ICR on the servicer, Ibercaja Banco, as in our cash flow
analysis we are excluding the application of a commingling loss.
Our RAS criteria do not cap our rating on this class of notes as
the highest achievable ratings are lower than our sovereign
rating. We have therefore raised to 'BB+ (sf)' from 'BB (sf)' and
removed from CreditWatch positive our rating on the class E
notes.

"We have affirmed our 'D (sf)' rating on the class F notes as
they continue to miss interest payments."

TDA Ibercaja 4 is a Spanish RMBS transaction that closed in
October 2006. The transaction securitizes residential loans
originated by Ibercaja Banco, which were granted to individuals
for the acquisition of their first residence, mainly concentrated
in Madrid and Aragon, Ibercaja Banco's main markets.

  RATINGS LIST

  Class             Rating
              To               From

  TDA Ibercaja 4, Fondo de Titulizacion de Activos EUR1.411
  Billion Mortgage-Backed Floating-Rate Notes

  Ratings Raised And Removed From CreditWatch Positive

  A1          AAA (sf)         AA+ (sf)/Watch Pos
  A2          AA (sf)          A+ (sf)/Watch Pos
  B           AA- (sf)         BBB+ (sf)/Watch Pos
  C           BBB+ (sf)        BB+ (sf)/Watch Pos
  E           BB+ (sf)         BB (sf)/Watch Pos

  Rating Affirmed and removed from Credit Watch Positive

  D           BB+ (sf)         BB+ (sf)/Watch Pos

  Rating Affirmed

  F           D (sf)


UCI 15: S&P Affirms B- (sf) Rating on Class C Notes
---------------------------------------------------
S&P Global Ratings took various credit rating actions on Fondo de
Titulizacion de Activos UCI 14 and Fondo de Titulizacion de
Activos UCI 15's classes of notes.

S&P said, "The rating actions follow the application of our
relevant criteria and our full analysis of the most recent
transactions information that we have received, and reflect the
transactions' 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 these transactions 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 these transactions 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.

The only counterparty risk in these transactions is related to
the guaranteed investment contract (GIC) account, which is
provided by Santander UK PLC (A/Stable/A-1). S&P said, "The
replacement language in these transactions' GIC account
agreements is in line with our current counterparty criteria.
Therefore, the application of our current counterparty criteria
does not cap our ratings in these transactions."

S&P said, "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."

  UCI 14

  The application of our European residential loans criteria
  resulted in the following weighted-average foreclosure
  frequency (WAFF) and weighted-average loss severity (WALS)
  assumptions:

  Rating level     WAFF (%)    WALS (%)

  AAA                 49.38       37.15
  AA                  39.75       32.46
  A                   32.72       24.17
  BBB                 26.14       19.64
  BB                  20.97       16.57
  B                   16.73       13.89

S&P said, "The class A, B, and C notes' credit enhancement has
increased to 23.0%, 15.0%, and 5.9%, respectively, from 14.9%,
8.5%, and 1.3% at our previous review due to the amortization of
the notes, which is sequential because the level of loans in
arrears for more than 90 days (currently at 13.03%) exceeds 2% of
the outstanding balance of the assets.

"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 European residential loans criteria,
including our updated credit figures and our cash flow analysis,
indicates that our rating on the class A notes withstands our
stresses at its current rating level. The application of our RAS
criteria does not cap our rating on this class of notes. We have
therefore affirmed and removed from CreditWatch positive our 'BBB
(sf)' rating on this class of notes.

"Our rating on the class B notes is not capped by our RAS
analysis as the application of our European residential loans
criteria, including our updated credit figures, results in a 'B+
(sf)' rating. Our cash flow analysis for this class of notes
results in a lower rating level due to four consecutive interest
shortfalls in scenarios where interest rates rise to
approximately 12%, which we don't expect to be the case in the
short to medium term, given the transaction's stable credit
enhancement and performance. We have therefore affirmed and
removed from CreditWatch positive our 'B+ (sf)' rating on this
class of notes.

"Credit enhancement has increased for the class C notes because
the reserve fund has not amortized. However, this class did not
pass at any rating level in our cash flow analysis. Therefore,
following the application of our criteria and guidance for
assigning 'CCC' category ratings, we believe that payments on
this class of notes do not depend upon favorable financial and
economic conditions. We have therefore affirmed and removed from
CreditWatch positive our 'B- (sf)' rating on the class C notes."

  UCI 15

  The application of our European residential loans criteria
  resulted in the following WAFF and WALS assumptions:

  Rating level     WAFF (%)    WALS (%)

  AAA                 46.39       43.69
  AA                  38.15       39.14
  A                   32.21       30.84
  BBB                 26.35       26.21
  BB                  21.98       23.01
  B                   18.12       20.14

S&P said, "The class A, B, and C notes' credit enhancement has
increased to 22.1%, 15.6%, and 4.4%, respectively, from 16.1%,
10.8%, and 1.7% at our previous reviews due to the amortization
of the notes, which is sequential because the level of loans in
arrears for more than 90 days (currently at 12.28%) exceeds 2% of
the outstanding balance of the assets.

"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 European residential loans criteria,
including our updated credit figures and our cash flow analysis,
indicates that our rating on the class A notes could withstand
our stresses at a higher rating level than that currently
assigned. We have therefore raised to 'BBB (sf)' from 'BBB- (sf)'
and removed from CreditWatch positive our rating on this class of
notes. The application of our RAS criteria does not cap our
rating on this class of notes.

"Our rating on the class B notes is not capped by our RAS
analysis as the application of our European residential loans
criteria, including our updated credit figures, results in a 'B
(sf)'rating. Our cash flow analysis for this class of notes
results in a lower rating level due to three consecutive interest
shortfalls in scenarios where interest rates rise to
approximately 12%, which we don't expect to be the case in the
short to medium term, given the transaction's stable credit
enhancement and performance. We have therefore affirmed and
removed from CreditWatch positive our 'B (sf)' rating on the
class B notes.

"Credit enhancement has increased for the class C notes because
the reserve fund has not amortized. However, this class of notes
did not pass at any rating level in our cash flow analysis.
Therefore, following the application of our criteria and guidance
for assigning 'CCC' category ratings, we believe that payments on
this class of notes do not depend upon favorable financial and
economic conditions. We have therefore affirmed and removed from
CreditWatch positive our 'B- (sf)' rating on this class of
notes."

UCI 14 and 15 are Spanish residential mortgage-backed securities
(RMBS) transactions that closed in November 2005 and May 2006.
These transactions securitize portfolios of residential mortgage
loans, which Union de Creditos Inmobiliarios, Establecimiento
Financiero de Credito originated and services.

  RATINGS LIST

  Class             Rating
              To               From

  Fondo de Titulizacion de Activos UCI 14
  EUR1.45 Billion Mortgage-Backed Floating-Rate Notes

  Ratings Affirmed And Removed From CreditWatch Positive
  A           BBB (sf)          BBB (sf)/Watch Pos
  B           B+ (sf)           B+ (sf)/Watch Pos
  C           B- (sf)           B- (sf)/Watch Pos

  Fondo de Titulizaci¢n de Activos UCI 15
  EUR1,452 Million Mortgage-Backed Floating-Rate Notes

  Rating Raised And Removed From CreditWatch Positive
  A           BBB (sf)          BBB- (sf)/Watch Pos

  Ratings Affirmed And Removed From CreditWatch Positive
  B           B (sf)            B (sf)/Watch Pos
  C           B- (sf)           B- (sf)/Watch Pos


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


EUROCHEM GROUP: Moody's Assigns Ba2 CFR, Outlook Stable
-------------------------------------------------------
Moody's Investors Service has assigned a Ba2 Corporate Family
Rating (CFR) and Ba2-PD Probability of Default Rating (PDR) to
EuroChem Group AG (EuroChem), a Switzerland-domiciled fertilizer
business with major assets in Russia.

The ratings outlook is stable.

EuroChem's Ba2 CFR primarily balances its large scale,
diversification and cost competitiveness with an elevated
Moody's-adjusted leverage and the execution risks related to its
new potash capacity, which heighten the company's exposure to the
fertilizer industry's cycles.

RATINGS RATIONALE

EuroChem's Ba2 CFR primarily reflects (1) the company's strong
business profile, underpinned by its large scale of operations,
diversified product mix, and established positions in the global
and regional fertilizer markets; (2) sustainable cost
competitiveness, which supports relatively high margins,
additionally helped by the weakness of the rouble; (3) potential
for deleveraging; and (4) proved access to long-term external
funding, including a shareholder loan facility, which support
liquidity.

At the same time, the CFR is constrained by (1) EuroChem's
elevated Moody's adjusted leverage, driven by significant
investments in potash and ammonia projects; (2) susceptibility to
the current weakness and cyclicality of the global fertilizer
market, which is heightened by the company's pronounced exposure
to more volatile nitrogen fertilizers; (3) execution risks
associated with the ramp-up of its recently launched new potash
facilities and their payback in line with the company's plan; and
(4) exposure to Russia's macroeconomic, regulatory and operating
environment, including the rouble's volatility, given that the
majority of its assets are in Russia.

Having commissioned its new potash facilities, EuroChem has added
potash to its fertilizer product mix and is now among the few
global producers of all three types of fertilizers.

However, until the first-stage potash facilities are fully
ramped-up by 2021, the company's product mix will primarily
consist of nitrogen and phosphate fertilizers as well as complex
fertilizers, which all together accounted for 70% of its $4.9
million sales in 2017. The company's focus is premium complex
fertilizers, which support its revenue and margins.

EuroChem's fertilizer sales on a value basis are mainly split
between Europe (32%), Russia (20%, including iron ore concentrate
as a by-product), Latin America (17%) and North America (12%). It
is estimated to be among the top five global producers in the
nitrogen and DAP/MAP segments by capacity.

EuroChem's well-invested production facilities in Russia, Belgium
and Lithuania are well located to serve its markets, the key of
which are high-demand Europe and Russia, where it has strong
market positions. Its developed distribution and logistics
networks facilitate the diversification of its market coverage.

EuroChem's strong market presence is driven by its cost
competitiveness, underpinned by its vertically integrated
business model, which assumes a high degree of self-sufficiency
in key raw materials and access to low-cost natural gas supplies
in Russia.

The weakness of the rouble additionally supports the company's
low cost base. Overall, its costs are comfortably in the second
quartile of global cost curves for nitrogen fertilizers and
phosphates, and are expected to be even better positioned on the
potash cost curve.

Based on its low-cost position and sizable operations, EuroChem
has demonstrated sustainably strong margins through the cycle,
though the weakness of fertilizer markets and some appreciation
in the rouble resulted in a reduction of EBITDA margins to 22.8%
in 2017 compared to 29.3% in 2016.

Moreover, EuroChem is focused on increasing its self-sufficiency
in raw materials as well as its business scale and market
positions overall. For this purpose, it is implementing three
investment projects, including two potash projects valued at $7
billion in total and an ammonia project at $1 billion.

The potash projects have opened the company's path into the
potash market and will build up its self-sufficiency in this
product in the future. The ammonia project will make it fully
self-sufficient in this product from the end of 2018.

The ambitious investments have made EuroChem's free cash flow
generation turn increasingly negative and its financial profile
has become highly leveraged, as measured by Moody's adjusted
debt/EBITDA of 4.7x at the end of March 2018 (including project
finance funding for the potash projects and the shareholder
loan).

A sustained weakening in fertilizer prices -- coinciding with the
rouble appreciation -- may jeopardise EuroChem's plan to
deleverage as would put pressure on EBITDA and margins. Moreover,
the ongoing weakness of the fertilizer markets may also cause
delays in the ramp-up of its potash projects and their paybacks,
additionally pressuring its financial profile.

That said, Moody's sees fertilizer prices as having bottomed out,
though they are likely to remain under pressure from overcapacity
and low crop prices through 2019. However, demand for fertilizers
is projected to grow, albeit at a low rate.

Moody's expects EuroChem to be able to increase its EBITDA on the
back of limited price improvements, modestly increasing volumes
and margins, turn to free cash flow positive, and deleverage
towards a Moody's adjusted debt/EBITDA of 3.5x over the next 12-
18 months on a sustained basis.

This expectation factors in EuroChem's product and market
diversification, established market position, and cost
competitiveness, as well as the projected absence of a sustained
and significant appreciation in the rouble.

The expectation also considers that the company's investment
program peaked in 2017 and that its internal financial policy
target is set at net debt/EBITDA of 1.5x-2.5x (excluding project
finance funding and the shareholder loan) through the fertilizer
market cycle. Furthermore, no dividend payments are expected
until the ramp-up of its potash projects has progressed
significantly.

Moody's views EuroChem's liquidity as adequate, assuming that the
company will maintain access to long-term external funding and
continue to proactively address its liquidity needs. At the end
of March 2018, its liquidity needs for the next 12 months,
including debt maturities of $0.9 billion and total capex of $1.3
billion (both maintenance and project-based), were sufficiently
covered by cash reserves of $287 million, projected cash flow and
availabilities under long-term committed facilities of $1.2
billion.

Moody's understands that the company is about to sign new sizable
long-term facilities with several foreign banks. With these
facilities factored in, liquidity over the next 18 months will be
addressed.

Moody's positively notes that EuroChem has a contractual loan
agreement with its majority shareholder, which allows it to
attract up to $1 billion of a perpetual zero-interest loan to
support its liquidity.

RATING OUTLOOK

The stable outlook reflects Moody's expectation that EuroChem's
strong market position and cost competitiveness will allow it to
deleverage towards adjusted debt/EBITDA of 3.5x and support a
healthy liquidity profile in the next 12-18 months.

WHAT COULD CHANGE THE RATING UP/DOWN

Upward pressure on the rating could develop if adjusted
debt/EBITDA decreases towards 3x and retained cash flow
(RCF)/debt (Moody's-adjusted) increases towards 20% on a
sustained basis.

The rating could come under pressure, if (1) EuroChem fails to
deleverage below adjusted debt/EBITDA of 4.0x in line with its
plans; and/or (2) the company's liquidity profile materially
deteriorates.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Chemical
Industry published in January 2018.

COMPANY PROFILE

EuroChem Group AG is a Switzerland-domiciled fertilizer business
with its major production assets in Russia. It also has assets in
Belgium, Lithuania and Kazakhstan. The company is one of the
leading producers of nitrogen and phosphate fertilizer globally,
and recently commissioned new potash capacity in Russia. It also
produces iron ore concentrate as a by-product and industrial
products. EuroChem has a wide distribution and logistics network
and sells its products to 10,000 customers in 100 countries. In
the 12 months ended March 2018, it generated revenue of $4.9
billion and EBITDA of $1.1 billion (adjusted by Moody's).


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


ARQIVA BROADCAST: Fitch Affirms 'B-' High-Yield Bonds Rating
------------------------------------------------------------
Fitch Ratings has affirmed Arqiva Financing plc and Arqiva PP
Financing's whole business securitisation (WBS) bonds at 'BBB',
and Arqiva Broadcast Finance plc's high-yield (HY) bonds at 'B-'.
The Outlooks are Stable.

KEY RATING DRIVERS

Arqiva's ratings reflect gradual expected deleveraging, in line
with its largely contracted revenue profile and resilience to RPI
and LIBOR sensitivities. Fitch expects net debt to EBITDA of the
WBS notes to fall to under 3.0x by 2025 from 5.1x in FY17 and to
close to 0x by FY30 and of the HY bonds to 5.9x in FY20 at
maturity from 6.3x in FY17, consistent with previous reviews.

The ratings also reflect the revised business plan put in place
by the new management team and the ongoing operational
restructuring, including a focus on core business lines and
operational efficiency. Fitch will continue to monitor progress
of the business plan against expected milestones.

Long-term RPI linked contracts and a monopoly position in
terrestrial television and radio broadcasting partly underpin
Arqiva's revenues. However Fitch perceives technology risk could
affect contract renewals in other segments such as the Digital
Platform business line.

Since the last annual review, Arqiva has performed broadly in
line with Fitch's base case with FY17 EBITDA at GBP474 million,
representing a strong 11% increase from GBP428 million in the
previous year and ahead of the 2017 rating case of GBP462
million.

Revenues Underpinned by Long-Term Contracts: Industry Profile -
Stronger

Operating Environment: Stronger

Arqiva is the sole UK national provider of network access and
managed transmission services (regulated by the UK Office of
Communications; Ofcom) for terrestrial television and radio
broadcasting. The company owns and operates all television and
over 90% of the radio transmission towers used for digital
terrestrial television (DTT) and terrestrial radio broadcasting
in the UK.

Arqiva has long-term contracts with public service broadcasters
to provide coverage to 98.5% of the UK population as well as with
commercial broadcasters. Arqiva owns two of the three main
national DTT commercial multiplexes (out of a total of six) plus
two new (HD-compatible) DTT multiplexes. In radio broadcasting,
Arqiva owns licenses for operating one national commercial
digital radio multiplex and more than 40% of the second.

Arqiva is the largest independent provider of wireless tower
sites in the UK, which are licensed to the mobile networks
operators (MNOs) and other wireless network operators, with
approximately 25% of the total active licensed macro cell site
market. Due to its industry nature, Arqiva is not exposed to
discretionary spending and Fitch does not view the sector as
cyclical.

Barriers to Entry: Stronger

Fitch views the industry's barriers to entry as high due to the
stringent regulatory framework and the industry's capital-
intensive nature.

Sustainability: Midrange

Arqiva is exposed to potential changes in technology in the
medium to long term, for instance, with the emergence of new
means for content delivery (e.g. IPTV), which may affect pricing,
in particular in the Digital Platform (DP) and Satellite and
Media divisions.

New Management Team, Ambitious Business Plan: Company Profile -
Midrange

Financial Performance: Midrange

Arqiva has under 10 years of overall stable trading history.
Revenue reductions in some business lines have been compensated
by gains in margins. Since FY09, EBITDA has grown strongly at a
CAGR of 5.7% but since FY13, Arqiva's performance has been lower,
with CAGR dropping to 3.3%.

Company Operations: Midrange

The sponsors are experienced and have a long-term view. A large
portion of Arqiva's revenues are derived from long-term (RPI
linked) contract revenues with customers with strong credit
ratings in telecoms, mobile network operators and TV and radio
broadcasting, with the BBC accounting for a large share of
revenues.

There have recently been significant changes in management. The
new management team is committed to the business transformation
programme, focused on cost-cutting and strategic growth.

Transparency: Midrange

Good insight into Arqiva's financials and operations is balanced
by the inherent complexity of the operations, which hampers
transparency.

Dependence on Operator: Weaker

Given the specialised and complex nature of Arqiva's operations,
there are only a few alternative operators capable of running its
secured assets, which diminishes the value of administrative
receivership.

Asset Quality: Midrange

Assets of this nature are very infrequently traded and there are
no alternative values, but assets can be disposed of individually
or on a going-concern basis. Maintenance capex is generally well
defined but timing and exact funding amount could be uncertain.

Standard WBS Structure: Debt Structure - Stronger (Senior Debt)

Debt Profile: 'Midrange', Security Package: 'Stronger',
Structural Features: 'Midrange'

The senior debt is fully amortising by either cash sweep or
following a fixed schedule. There are many large swaps due to
legacy positions, including super senior index-linked swaps (ILS)
and index-linked swaps overlays and other interest rate (IRS) and
FX swaps, which adds to the complexity of the debt structure. The
senior debt still contains some prolonged interest-only periods,
which is credit negative.

The senior debt benefits from a typical WBS security package,
namely, first ranking security over freehold/long leasehold sites
with the possibility of appointing an administrative receiver.
The senior debt benefits also from a comprehensive set of
covenants and cash lockup triggers set at moderate levels. The
issuer liquidity facility covers only 12 months of debt service.
The issuer is not an orphan SPV. However, Fitch deems the
potential conflicts of interest due to the non-orphan status of
the SPVs and their directors also being directors of other group
companies remote and consistent with the notes' ratings, given
the structural protection in the transaction's legal
documentation.

Subordinated Debt, Refinance Risk: Debt Structure - Weaker
(Junior Debt)

Debt Profile: 'Weaker', Security Package: 'Weaker', Structural
Features: 'Weaker'

The HY bonds are bullet. They are deeply structurally
subordinated and would default if dividends pay-out from the WBS
group is disrupted for more than six months. Fitch views their
security package as weak as it consists of share pledges over
holding companies with no second lien security over the WBS
security package. The covenants and lockup triggers are
comprehensive but are set at low levels. The issuer's liquidity
cash reserve account covers only six months of interest payments.

Peer Group

The transaction shares similar debt characteristics as CPUK
(Center Parcs, holiday parks operator), namely a strong cash
sweep mechanism that is triggered at expected maturity dates.
However, the free cash flow debt service coverage ratios (DSCRs)
are not comparable with CPUK as they have a significantly higher
metric at 2.3x vs. 1.5x for Arqiva. CPUK is effectively
constrained by the nature of its industry with its Industry
Profile KRD scored 'Weaker' vs. 'Stronger' for Arqiva.
Additionally, the deleveraging profile is key for CPUK's rating
analysis, which is not reflected in the DSCR.

For the more junior debt, given the deeply subordinated nature of
the debt and their refinancing risk (bullet in five years), the
read-across is not straightforward, and Fitch needs to use other
metrics. However, at similar ratings, Fitch deems a higher DSCR
appropriate for Arqiva given the cash sweep of the senior debt,
which makes the junior debt much more significantly subordinated.

RATING SENSITIVITIES

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

  - Under Fitch's rating case, if net debt to EBITDA is forecast
to be above 3x in FY25 and 0x in FY32, it could result in a
downgrade of the senior debt. The HY notes could be downgraded if
their refinancing risk increases or if the full cash sweep
features embedded in some of the senior debt is close to being
triggered.

  - Arqiva's future cash flow could be curtailed following
unfavourable and unforeseen significant changes in regulation by
Ofcom with regard to its pricing formulas, particularly for
future DTT or radio broadcasting contracts, licensing costs (e.g.
administrative incentive pricing) or even spectrum allocations.
The risk of alternative and emerging technologies such as IPTV
could also threaten Arqiva's revenues, either through technology
obsolescence risk or a lower ad-pool available to linear TV
content providers. This risk is currently mitigated by the
transaction's potentially rapid deleveraging assuming cash sweep
amortisation and the long-term contracts securing significant
revenues.

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

  - The senior notes could be upgraded if under Fitch's base
case, net debt to EBITDA remains below 3x in FY25 and 0x in FY30
and if the company signs new long-term contracts or if renewals
of existing contracts are renegotiated on better terms than
expected. The HY notes are unlikely to be upgraded.

CREDIT UPDATE

For the year ended June 30, 2017, revenue for the group was
GBP941 million, an increase of 6% from GBP884 million in the
previous year and ahead of Fitch's base case forecast of GBP930
million. For the six months to December 2017 (1H18), revenue was
GBP482 million, up by 3% over 1H17.

EBITDA for the group was GBP474 million, representing an 11%
increase from 2016 (GBP428 million), and ahead of the base case
forecast of GBP462 million, reflecting Arqiva's continued
progress in its business transformation plan. EBITDA for 1H18
grew by 13% over 1H17 as Arqiva continued to make progress
against milestones on its cost reduction and business
transformation programme. Senior net debt to EBITDA for FY17 was
5.1x, slightly lower than the Fitch base case expected 5.2x.
Junior net debt to EBITDA was 6.3x, slightly below the expected
6.5x.

Fitch Cases

Fitch's rating case continues to assume that the senior loans and
notes with expected maturities would not be refinanced but would
instead be paid back by way of cash sweep. The principles of the
rating case remain the same as previous years, but the 2018
rating case reflects contracts won or extended over the past
year. Fitch's rating case EBITDA forecast from FY18-33 is about
the same as the previous review, reflecting the higher base, but
offset by slightly lower short-term inflation assumptions
stemming from Fitch's revised sovereign forecast.

Overall, Fitch's rating case reflects uncertainty in longer-term
digital platform content demand and telecom growth expectations
modelled through price and volume declines at contract renewal.
Fitch takes a similar but harsher approach for satellite
revenues. Smart Metering revenues in its rating case only reflect
contracts already won.

Arqiva expects to achieve cost savings by FY22 through a
combination of third-party savings and headcount savings. Fitch
has given partial credit to the expected savings but added an
additional stress on operating expenditure as it does not yet
have a track record of crystallised savings.


BHS GROUP: Lawmakers Want FRC to Divulge PwC Misconduct Details
---------------------------------------------------------------
Kirstin Ridley at Reuters reports that British lawmakers are
pressing the accounting regulator to divulge details of the
misconduct that prompted it to slap unprecedented fines on
accountants PwC and a former senior partner over a 2014 audit of
now-collapsed retail chain BHS.

The Financial Reporting Council (FRC) overnight fined
PricewaterhouseCoopers, one of Britain's Big Four accounting
firms, a record GBP6.5 million (US$9 million) and former partner
Steve Denison GBP325,000 over the audit, Reuters discloses.

PwC's 2014 audit of BHS signed off the company as a "going
concern" days before billionaire retailer Philip Green sold the
loss-making group for a token one pound to a serial bankrupt,
Reuters relates.  BHS's collapse in April 2016 threw 11,000
people out of work and permanently reduced the pensions of 20,000
people, Reuters recounts.

According to Reuters, Frank Field, the chairman of the
parliamentary work and pensions committee, said on June 13 he had
asked the FRC whether further investigations into other BHS
audits and wider and stronger sanctions were needed.

Although the FRC said PwC and Mr. Denison admitted misconduct, it
has not given further details, Reuters notes.

                          About BHS

BHS Group was a high street retailer offering fashion for the
whole family, furniture and home accessories.

BHS was put into administration in April 2016 in one of the
U.K.'s largest ever corporate failures, according to The Am Law
Daily.  More than 11,000 jobs were lost and 20,000 pensions (the
U.K. equivalent of a 401k) put at risk after it emerged that the
company, which had more than 160 stores across the U.K., had a
pension deficit of GBP571 million (US$703 million), The Am Law
Daily disclosed.

Sir Philip Green, a retail magnate with a net worth of more than
US$5 billion, has been heavily criticized for his role in the
collapse of BHS, The Am Law Daily said.  Mr. Green and other
shareholders had taken around GBP580 million (US$714 million) out
of the business before selling it for just GBP1 (US$1.23), The Am
Law Daily noted.

Linklaters acted for Green's Arcadia Group on the sale of the
company to Retail Acquisitions, which was advised by London-based
technology, media and telecoms specialist Olswang, The Am Law
Daily added.

Weil Gotshal & Manges and DLA then took the lead roles on the
administration, acting for the company and administrators Duff &
Phelps, respectively, while Jones Day was appointed by the
administrators to investigate the actions of the company's former
directors, The Am Law Daily related.


CABOT FINANCIAL: S&P Alters Outlook to Pos. & Affirms 'B+' ICR
--------------------------------------------------------------
S&P Global Ratings revised its outlook on U.K.-based Cabot
Financial Ltd. to positive from stable. At the same time, S&P
affirmed its 'B+' long-term issuer credit rating.

S&P said, "We also affirmed our 'B+' issue ratings on the
existing senior secured notes based on indicative recovery
prospects of 50%-70% (rounded estimate: 55%).

"Our outlook revision reflects our view that Cabot is well placed
to continue strengthening its position in the U.K. debt
collection market and grow further in other European countries.
The group's consistent strategic focus has led to a track record
of significant business growth while maintaining stable credit
ratios, and signs of improvement in revenue diversity. For
example, on March 31, 2018, servicing revenue was up to 22% of
its GBP88 million total revenue, compared with 8% and GBP65
million in the same quarter two years earlier. Over the coming
quarters we believe Cabot will continue to sustain its financial
performance, pursue further growth and diversity in its revenue
base, and enhance its already good position in the U.K. debt
collection market.

"On May 9, 2018, Cabot announced that U.S.-based debt purchaser
Encore Capital Group had entered an agreement to acquire the
remainder of Cabot that it did not already own. While this will
have no effect on Cabot's capital structure and no material
impact on its strategy, we believe that Encore's acquisition
should support the medium-term stability of Cabot's ownership and
governance, helping Cabot to remain focused on its key strategic
goals. As a listed financial institution with stronger
consolidated credit metrics, we believe that Encore's influence
should not lead to an aggressive debt-financed growth strategy at
Cabot. However, the separate restricted bond groups and separate
funding sources means that we do not factor into our rating the
potential for extraordinary group support or negative
intervention."

Over the next 12-18 months S&P forecasts the group will stay at
the stronger end of the following ranges:

-- Gross debt to adjusted EBITDA of 4x-5x;
-- Funds from operations to gross debt of 12%-20%; and
-- Adjusted EBITDA to interest expense of 2x-3x.

S&P's forecasts are supported by Cabot's track record of stable
credit ratios, good cash collections performance, and the
granularity of its back book. While S&P recognizes the likelihood
the group will not materially improve on its current credit
metrics over our 12-month outlook horizon, its expectation of a
stable or marginally positive trend in credit ratios is based on:

-- A moderation in the pace of growth, with combined total
    revenue growing by about 20%-25% during 2018 on a pro forma
    basis including Wescot;

-- Growth in its debt servicing revenue, which has lower
    investment requirements;

-- A moderate decline in the group's EBITDA margin from a
    relatively high level, reflecting the increased proportion of
    lower margin servicing revenue and higher proportion of semi-
    performing debt portfolios; and

-- No significant debt-financed acquisitions.

Cabot reported significant growth in the 12 months to Dec. 31,
2017, with portfolio acquisitions of GBP322 million and cash
income growth up 16% to GBP447.7 million. S&P said, "By our
measures, its gross debt to the past 12 months' EBITDA was
relatively flat year-on-year at 4.5x, reflecting that the funding
of its growth was balanced between debt-financing and internal
cash generation. In November 2017, Cabot also acquired U.K.-based
debt servicing company Wescot Credit Services for approximately
GBP100 million, which we believe will continue to support the
progress the group has made on its revenue diversity."

S&P said, "Our rating on Cabot also reflects the group's
concentrated focus on the distressed debt industry and current
coverage of a mature market that is exposed to noteworthy
competitive pressures. This is somewhat offset by its top tier
market position in the U.K. While consumer credit regulation
remains a key risk for Cabot, we believe that the regulatory
environment as it pertains to debt collection companies has
somewhat stabilized relative to the environment in the years
after oversight transitioned to the Financial Conduct Authority
in 2014. We have therefore revised Cabot's business risk profile
upward so that it better reflects its scale, operational
capability, stable strategy, and market position in the context
of its peers.

"Our rating also reflects that Cabot will continue to grow at a
fast pace over the coming years, which presents potential
operational and funding risks. Our base case assumes that it will
manage its growth well. We also acknowledge that its revenues are
geographically more concentrated than certain peers. Of its
capital deployment in the first quarter of 2018, 91% was in the
U.K., which we expect will evolve slightly as it continues to
grow slowly in other parts of Europe. This means the group is
more exposed to the leveraged U.K. household sector than certain
peers. While its back book has proven resilient to date, further
evidence of stable cash collections in more challenging
macroeconomic conditions would support a higher rating.

"The positive outlook reflects Cabot's consecutive years of
strong business growth, its consistent strategy, and that we
don't expect its leverage to rise. Our base-case scenario over
our 12-month outlook horizon assumes that Cabot will continue to
grow its cash collections from owned debt portfolios and
servicing revenue, and modestly improve the scale of its
operations outside the U.K., which will continue to support the
resiliency of its earnings.

"We could raise the long-term rating on Cabot if it maintains its
consistent strategic focus after its ownership change is
completed, and continues to grow in line with the market without
weakening its credit ratios. This will be supported by continued
cash collections performance, improving scale in its capital-
light servicing revenue, and controlled growth in Europe."
Alternatively, S&P could also consider raising the rating if
Cabot's credit ratios look like they are trending sustainably in
the following ranges:

-- A ratio of gross debt to adjusted EBITDA between 3x-4x;
-- A ratio of funds from operations to gross debt between 20%-
    30%; or
-- An adjusted EBITDA coverage of gross cash interest expenses
    between 3x-6x.

S&P could revise the outlook to stable if Cabot pursued a more
aggressive growth strategy that put pressure on its credit ratios
or undermined recent progress made in revenue diversification, or
if its cash collections performance deteriorates.


PUROGENIX LTD: Enters Administration, Buyer Sought for Business
---------------------------------------------------------------
Rachel Constantine at Business-Sale reports that pharmaceutical
manufacturing business Purogenix Ltd and Purogenix Holdings Ltd
has been placed in administration, having "[run] out of cash
before fully establishing itself."

KPMG's Restructuring division appointed Steve Absolom and Rob
Croxen as the joint administrators, and are now on the hunt for
buyers for Purogenix's business or assets, Business-Sale relates.

The Kent-based company, which creates the Amoxicillin antibiotic
using a biogeneric manufacturing process, stopped its trading
operations at the end of last year as a result of running out of
necessary funds, Business-Sale recounts.  It had since been
searching for investors to provide the company with financial
support, but was unsuccessful in acquiring any investment,
Business-Sale notes.

Purogenix Ltd employed 45 members of staff prior to going into
administration, and have retained a select few to assist the KPMG
administration team with the sales process, Business-Sale states.


SUNLINE DIRECT: Files Notice to Appoint Administrator
-----------------------------------------------------
Caroline Ramsey at Business-Sale reports that Sunline Direct Mail
(SDM), an e-commerce and direct mail firm based in Loughborough,
is looking to assign an administrator.

This comes as a result of the recent updates to General Data
Protection Regulations, and in response to the concerns regarding
plastic use, inspired by the Blue Planet documentaries
commissioned by the BBC, Business-Sale notes.

SDM filed the noticed despite having secured new investment in
the last two years, Business-Sale relays, citing the AIM-listed
owner CEPS.

In lieu of its current fiscal situation, Moorfields Advisory has
been invited to advise SDM of its future options, and has
suggested an accelerated marketing program with the intention of
pushing sales while SDM arranges to affirm an administrator,
Business-Sale discloses.

According to Business-Sale, a court-approved NOI has also been
obtained to protect the company from creditors to allow normal
trading operations alongside being put up for sale.

The sale of SDM's business and assets will be finalized once
administrators have been selected, Business-Sale states.


===============
X X X X X X X X
===============


* BOOK REVIEW: The First Junk Bond A Story of Corporate Boom
------------------------------------------------------------
Author: Harlan D. Platt
Publisher: Beard Books
Softcover: 236 pages
List Price: $34.95
Review by Gail Owens Hoelscher

Order your personal copy today and one for a colleague at
http://www.beardbooks.com/beardbooks/the_first_junk_bond.html
Only one in ten failed businesses is equal to the task of
reorganizing itself and satisfying its prior debts in some
fashion.

This engrossing book follows the extraordinary journey of Texas
International, Inc (known by its New York Stock Exchange stock
symbol, TEI), through its corporate growth and decline, debt
exchange offers, and corporate renaissance as Phoenix Resource
Companies, Inc. As Harlan Platt puts it, TEI "flourished for a
brief luminous moment but then crashed to earth and was
consumed."

TEI's story features attention-grabbing characters, petroleum
exploration innovations, financial innovations, and lots of risk
taking.

The First Junk Bond was originally published in 1994 and received
solidly favorable reviews. The then-managing director of High
Yield Securities Research and Economics for Merrill Lynch said
that the book "is a richly detailed case study. Platt integrates
corporate history, industry fundamentals, financial analysis and
bankruptcy law on a scale that has rarely, if ever, been
attempted." A retired U.S. Bankruptcy Court judge noted, "(i)t
should appeal as supplementary reading to students in both
business schools and law schools. Even those who practice.in the
areas of business law, accounting and investments can obtain a
greater understanding and perspective of their professional
expertise."

"TEI's saga is noteworthy because of the company's resilience and
ingenuity in coping with the changing environment of the 1980s,
its execution of innovative corporate strategies that were widely
imitated and its extraordinary trading history," says the author.
TEI issued the first junk bond. In 1986 it achieved the largest
percentage gain on the NYSE, and in 1987 suffered the largest
percentage loss. It issued one of the first bonds secured by a
physical commodity and then later issued one of the first PIK
(payment in kind) bonds. It was one of the first vulture
investors, to be targeted by vulture investors later on. Its
president was involved in an insider trading scandal. It
innovated strip financing. It engaged in several workouts to sell
off operations and raise cash to reduce debt. It completed three
exchange offers 196 that converted debt in to equity.
In 1977, TEI, primarily an oil production outfit, had had a
reprieve from bankruptcy through Michael Milken's first ever junk
bond. The fresh capital had allowed TEI to acquire a controlling
interest of Phoenix Resources Company, a part of King Resources
Company. TEI purchased creditors' claims against King that were
subsequently converted into stock under the terms of King's
reorganization plan. Only two years later, cash deficiencies
forced Phoenix to sell off its nonenergy businesses. Vulture
investors tried to buy up outstanding TEI stock. TEI sold off its
own nonenergy businesses, and focused on oil and gas exploration.
An enormous oil discovery in Egypt made the future look grand.
The value of TEI stock soared. Somehow, however, less than two
years later, TEI was in bankruptcy. What a ride! All told, the
book has 63 tables and 32 figures on all aspects of TEI's rise,
fall, and renaissance. Businesspeople will find especially
absorbing the details of how the company's bankruptcy filing
affected various stakeholders, the bankruptcy negotiation
process, and the alternative post-bankruptcy financial structures
that were considered. Those interested in the oil and gas
industry will find the book a primer on the subject, with an
appendix devoted to exploration and drilling, and another on oil
and gas accounting.

Harlan Platt is a professor of Finance and Insurance at
Northeastern University. He is president of 911RISK, Inc., which
specializes in developing analytical models to predict corporate
distress. He received a Ph.D. from the University of Michigan,
and holds a B.A. degree from Northwestern University.



                            *********

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 * * *