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

                           E U R O P E

           Tuesday, October 9, 2018, Vol. 19, No. 200


                            Headlines


B E L A R U S

BELARUS: S&P Affirms B/B Sovereign Credit Ratings, Outlook Stable


C R O A T I A

HRVATSKA ELEKTROPRIVREDA: Moody's Affirms Ba2 CFR, Outlook Stable


G E R M A N Y

THYSSENKRUPP AG: Moody's Revises Outlook on Ba2 CFR to Negative


I R E L A N D

DUBLIN BAY 2018-1: DBRS Finalizes BB(low) Rating on Cl. E Notes
HALCYON LOAN 2016: Fitch Assigns B-(EXP) Rating to Class F Notes


I T A L Y

ITALY: Spending Plans Lead to Nervousness in Financial Markets
ITALY: Fiscal Problems Fuel Concern of Contagion Risks in EU


L U X E M B O U R G

BREEZE FINANCE: Fitch Affirms CCC Rating on Class A Bonds
CRC BREEZE: Fitch Affirms CCC Rating on Class A Notes


N E T H E R L A N D S

FIAT CHRYSLER: DBRS Hikes Issuer Rating to BB(high)
MATTRESS FIRM: Files Voluntary Chapter 11 Bankruptcy Petition
PROMONTORIA HOLDING: Moody's Assigns B2 CFR, Outlook Stable


P O L A N D

GETBACK SA: Posts PLN1.12-Bil. Net Loss in First Half 2018


R U S S I A

ANTALYA: Fitch Maintains BB/BB+ IDRs on Rating Watch Negative
KARELIA REPUBLIC: Fitch Withdraws B+ LT Issuer Default Ratings


S W E D E N

INVUO TECHNOLOGIES: Files Bankruptcy Application


T U R K E Y

ISTANBUL TAKAS: Fitch Cuts Viability Rating to b+, Outlook Neg.
PALET CONSTRUCTION: Files for Bankruptcy Protection
TEB FINANSMAN: Fitch Lowers LT IDR to BB-, Outlook Negative


U N I T E D   K I N G D O M

RMAC NO. 2: Moody's Assigns (P)Ca Rating to Class X Notes
RMAC NO. 2: S&P Assigns Prelim. CCC Rating to Class X Notes


                            *********



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B E L A R U S
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BELARUS: S&P Affirms B/B Sovereign Credit Ratings, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings, on Oct. 5, 2018, affirmed its 'B/B' long- and
short-term foreign and local currency sovereign credit ratings on
Belarus. The outlook on the long-term ratings is stable.

OUTLOOK

S&P said, "The stable outlook reflects our expectation that
Belarus' external imbalances will not escalate while the fiscal
stance remains comparatively tight over the next 12 months, and
that the government will retain market access and support from
Russia to refinance upcoming public debt redemptions.

"We could consider lowering the ratings if the government's
refinancing plans were threatened, for example, by a reversal of
political and economic support from Russia. We could also lower
the ratings if contingent fiscal risks from the banking or public
enterprise sectors were to crystalize on the sovereign balance
sheet at higher levels than we expect.

"We could raise the ratings if Belarus implemented a credible
reform program that substantially reduced the country's external
vulnerabilities and addressed weaknesses in the public enterprise
and bank sectors. Over time, we expect such reforms would also
benefit Belarus' growth prospects."

RATIONALE

S&P said, "Our ratings on Belarus are primarily supported by the
financial assistance it receives from the Russian government,
despite occasional disputes between the two countries. The
ratings are also supported by what we view as improved
macroeconomic policymaking in recent years. We consider that this
has helped to slow down the pace of public debt accumulation and
bring persistently high inflation under control."

The sovereign ratings are constrained by Belarus' low
institutional effectiveness; vulnerable fiscal and balance-of-
payment positions; substantial off-balance-sheet expenditure;
and, despite recent improvements, the still-limited flexibility
and effectiveness of monetary policy.

Although economic performance has strengthened following the
recession in 2015-2016, the country's headline growth rates
remain below those of countries at a comparable level of economic
development. Moreover, S&P does not expect real GDP to return to
the 2014 level until the end of 2019.

Institutional and Economic Profile: Economic recovery continues,
although growth rates will decelerate

-- The economy continues to recover, but S&P expects growth
    rates to decelerate.

-- Domestic institutions remain weak. Power is highly
    centralized and there are limited checks and balances between
    various state bodies.

-- Belarus achieved some progress in agreeing the future terms
     of oil and gas supplies from Russia, but uncertainties
     remain.

The economy of Belarus is recovering from the recession it
suffered in 2015-2016. Over the first eight months of 2018,
output grew by 3.7% year-on-year, according to rapid estimates
from the country's statistical office. Given the stronger
outturn, as indicated by this high frequency data, S&P has
revised its growth forecast for 2018 marginally upward, to 3.0%
from 2.5%.

That said, growth appears to be decelerating and S&P expects this
trend to persist in the second half of the year. According to the
authorities, poor weather conditions have hit performance in the
agriculture sector, contributing to the recent slowdown, but
industry and construction have fared better.

S&P said, "Notably, we consider much of the improvement over the
past two years to be cyclical in nature, reflecting the favorable
performance of Belarus' trade partners. Both investment and
consumption have recovered against a background of more stable
local currency value and inflation."

S&P expects growth rates to continue to moderate, due to base
effects and structural constraints that limit potential growth in
Belarus. Structural constraints include the state's extensive
role in the economy and the existence of a multitude of loss-
making public enterprises. Despite some recovery, the investment
outlook remains cautious, as demonstrated by sluggish growth in
corporate credit.

Foreign investment is unlikely to stimulate growth, given the
perception of the risky business environment in Belarus. S&P
said, "Consequently, we expect growth to average 2% a year over
2019-2021, which is modest compared with other countries at a
similar level of economic development. In real terms, we forecast
that output will only recover to 2014 levels by the end of 2019."

S&P considers risks to its forecast to be balanced at present.
The main downside risks are closely linked with developments in
Russia. Specifically, economic growth in Belarus could turn out
weaker if:

-- Western sanctions on Russia are expanded. The U.S. is
    considering several additional measures, including sanctions
    against Russian sovereign debt and state-owned banks. If this
    risk materializes, it could affect Belarus through weaker
    growth in Russia and, potentially, through the weaker Russian
    ruble. Nearly half of Belarus' trade is with Russia. In
    addition, several subsidiaries of Russian banks operate in
    Belarus and as such could face legal challenges or tighter
    external funding conditions.

-- The commodity cycle weakens. Belarus' economy depends on
    commodities. Fuels, chemicals, and metals comprise nearly 50%
    of Belarus' exports and Russia remains an important consumer
    of Belarus' machinery goods and dairy produce. Therefore, if
    oil prices undershoot our current forecasts, the adverse
    effect on Russia would aggravate the direct negative impact.

S&P said, "At the same time, we see some upside growth potential
as well. This mainly stems from stronger growth in the EU, which
takes a substantial proportion of Belarus' exports, and the
opportunity to diversify the export basket geographically -- for
example, to China. Stronger performance in Belarus' IT sector
could also support growth. The IT sector has become more
important in recent years, as demonstrated by its increased
contribution to Belarus' services exports. Telecommunications and
IT services amounted to only 8% of services exports in 2010, this
figure had risen to 18% by 2017. Belarus' geographic location,
low unit labor costs, and comparatively high educational
standards bode well for its ability to attract outsourcing
contracts for some IT operations. Several start-ups have also
emerged in Belarus in recent years.

"In our view, Belarus' institutional effectiveness remains weak;
President Alexander Lukashenko controls the government's branches
of power. Highly centralized power makes policymaking difficult
to predict and we believe there are only limited checks and
balances in place between various state institutions. Belarus is
due to hold presidential elections in 2020, but these could be
brought forward to 2019. In any case, we do not anticipate any
major changes in Belarus' political arrangements over the next
few years.

"That said, we consider that Belarus' economic policymaking has
improved in recent years. The country has transitioned to a more-
flexible exchange rate regime, and inflation has fallen to below
5% in year-on-year terms in 2018. This is a notable achievement
for a country that experienced hyperinflation as recently as
2011-2012. Although legacy issues remain, the authorities have
also maintained a tighter fiscal policy that aims to limit
contingent fiscal risks and so stabilize public debt levels.

"In our view, Belarus' bilateral relations with Russia remain
very important. Specifically, support from Russia is key to
enable Belarus to meet its financial obligations on time and in
full, in our view. Belarus satisfies its hydrocarbon needs
through Russian imports and 45% of its exports and over 40% of
foreign official debt is to Russia. Historically, the relations
between the neighboring countries have been volatile at times,
putting the readiness of Russia to provide financial support in
question. Despite that, compromise agreements have normally been
reached, even though negotiations often appeared difficult. In
September 2018, Belarus President Alexander Lukashenko announced
that all differences pertaining to the conditions of future oil
and gas supplies had been ironed out. We view this development as
positive, although concrete details of potential future
conditions are lacking and downside risks remain, in our view."

Flexibility and Performance Profile: Monetary and fiscal policies
have improved, but weak balance of payments remains a key risk

-- The monetary policy framework has improved and in 2018
    inflation fell below 5% for the first time in the country's
    post-Soviet history.

-- The authorities have taken steps to reduce fiscal risks, but
    these remain elevated.

-- Balance-of-payments vulnerabilities still constrain the
    sovereign ratings.

S&P said, "We consider that the monetary policy framework in
Belarus has improved in recent years. The authorities previously
transitioned to a more-flexible exchange rate arrangement, and we
currently view the Belarusian ruble as largely floating and
subject to occasional interventions in the foreign exchange
market. Most of the restrictions on operations with foreign
currency, including the mandatory repatriation of foreign
currency earnings, have been relaxed."

Historically, the authorities actively encouraged directed
lending through the country's commercial banks. The National Bank
of the Republic of Belarus (NBRB, the central bank) also
monetized some of the fiscal expenditures, leading to
hyperinflation over 2011-2012. The latter practice has been
discontinued and directed lending has been downsized
significantly in recent years. The authorities plan to reduce it
further in future. The central bank's main focus is on the broad
money supply, which is its intermediate monetary target. Its
medium-term goal is to move to full inflation targeting. In S&P's
view, it has already made important progress toward this goal.
For example, in 2018, inflation fell below 5% for the first time
in Belarus' post-Soviet history, against an NBRB target of "no
more than 6%."

That said, substantial constraints remain. In S&P's view, the
NBRB lacks the independence to make key decisions regarding its
policy direction. The weak position of the banking system, very
high deposit and loan dollarization, and underdeveloped domestic
capital market in local currency also inhibit the monetary
transmission channel. Even domestic public debt is predominantly
denominated in foreign currencies.

Alongside monetary policy, S&P notes some improvements in
Belarus' fiscal policy. The general government budget has
historically been in surplus, masking below-the-line, off-
balance-sheet activities. These, combined with weakening exchange
rates, inflated debt levels to an estimated 45% of GDP this year,
from about 25% in 2012. Over the past two years, the authorities
have put increasing emphasis on arresting the continued rise in
public leverage. Specific measures include raising the previously
subsidized utility tariffs to cost recovery levels, limiting the
amount of extended guarantees, and prioritizing investment
projects to reduce external borrowing. According to official
statistics, the headline general government budget posted a 3% of
GDP surplus last year and we expect a similar performance this
year. S&P also notes that the government intends to use any
additional fiscal revenues stemming from overperformance to pay
down debt.

Nevertheless, S&P believes multiple fiscal risks remain,
specifically:

-- Some off-budget operations continue. For instance, the cost
     of construction of the new nuclear power plant has been
     booked below the line, so that official statistics on
     consolidated budgetary performance exclude this expenditure.
     The authorities estimate the plant's total cost at $7 billion
     (13% of 2017 GDP). It is primarily financed by a bilateral
     loan from Russia, which can be drawn on up to $10 billion.
     S&P said, "As of end-2017, the authorities had drawn $3
     billion under this line and we expect further disbursements
     over 2018-2020. Our forecast of Belarus' general government
     debt includes the construction cost of the nuclear power
     plant; this is why we forecast rising public leverage, even
     though Belarus is reporting headline surpluses. We see risks
     stemming from the project, given that several EU countries
     have announced that they do not intend to buy electricity
     generated by the plant. This could make it more difficult to
     service the underlying loan. Because there have been some
     delays in construction on the Russian side, we understand
     that the two governments could renegotiate the loan
     conditions to prolong its maturity."

-- Contingent liability risks could materialize in the banking
    system. During 2015 and 2016, the government cleaned up the
    balance sheets of several banks by swapping nonperforming
    loans in the wood processing and agricultural sectors for
    central and local government bonds. In S&P's view, the
    strained domestic banking system still poses a moderate
    contingent liability for the government, which may need to
    clean up the balance sheets of more banks in the future. Any
     potential clean-up would most likely be related to
     government-owned bank exposure to state-owned enterprises
     (SOEs), many of which are burdened by legacy debt and make
     losses.

-- Potential disagreements between Belarus and Russia on the
    terms of oil and gas supplies could hurt Belarus' budget
    revenues. Historically, Belarus received a certain amount of
     oil from Russia free of the customs duty. This oil was
     refined in Belarus and then exported, with the relevant duty
     imposed directly by Belarus and kept as part of the bilateral
    agreement. Russia is currently implementing a tax maneuver,
    under which it would effectively replace the customs duty on
    oil exports from Russia with a tax on extraction, which would
    erode this revenue source for Belarus. S&P understands that
    the two sides are in the process of agreeing a compensation
    mechanism. Although substantial progress appears to have been
    made, as highlighted by the announcements after the Sochi
    September 2018 meeting between the two presidents, risks
    remain if the agreement is not concluded. According to the
     authorities, the direct budgetary cost of the tax maneuver
     is, on average, close to 1% of GDP a year. The budget may
     also have to compensate the oil processing companies, at an
    additional cost.

-- Unfavorable public debt structure exposes Belarus to currency
    risks. S&P estimates that about 95% of debt is foreign
    currency-denominated and characterized by a heavy repayment
    profile.

Belarus' balance of payments vulnerabilities remain the key
constraint on S&P's sovereign ratings. Although the headline
current account deficits are comparatively modest at about 3% of
GDP on average over the past three years, the economy's external
debt (net of liquid public and financial sector foreign assets)
is projected to be high at 74% of current account receipts in
2018. Belarus consistently faces elevated external financing
requirements. The bulk of its gross external debt pertains to the
public sector and is characterized by a heavy debt service
profile. Belarus has successfully issued Eurobonds on two
occasions, in mid-2017 and early 2018. It used the proceeds to
refinance other commercial debt that was coming due. S&P expects
Belarus to remain dependent on continued market access to meet
future repayments.

Excluding foreign financing, S&P views Belarus' own external
buffers as weak. As of July 2018, NBRB's gross foreign exchange
(FX) reserves totaled about $7.3 billion. However, the NBRB has
FX obligations to domestic banks of about $1 billion and a
government FX deposit of around $5 billion, underpinned by a
recent bond issuance.

S&P said, "We do not expect the government to be able to deploy
all its resources at the NBRB, given the need to maintain a
balance-of-payments buffer. In addition to the obligations
described above, external debt of around $1 billion is booked on
NBRB's balance sheet. We understand the authorities aim to
gradually pay down both the NBRB's direct external debt and its
FX obligations to domestic banks. Under the current set up, the
interest rate NBRB earns on its foreign reserves is lower than
the cost of its FX obligations. Given the favorable foreign trade
environment, we anticipate that the central bank will have some
room to buy reserves and pay down its liabilities, as planned.

"Positively, we believe that there has been some diversification
in the structure of Belarus' exports. IT and communication
services have been steadily expanding in recent years. This has
provided a new source of FX revenues contributing about 0.5% of
GDP annually."

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable. At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision. After the primary analyst gave opening remarks and
explained the recommendation, the Committee discussed key rating
factors and critical issues in accordance with the relevant
criteria. Qualitative and quantitative risk factors were
considered and discussed, looking at track-record and forecasts.

The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.

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

  RATINGS LIST

  Ratings Affirmed

  Belarus
   Sovereign Credit Rating                B/Stable/B
   Senior Unsecured                       B
   Transfer & Convertibility Assessment   B



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C R O A T I A
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HRVATSKA ELEKTROPRIVREDA: Moody's Affirms Ba2 CFR, Outlook Stable
-----------------------------------------------------------------
Moody's Investors Service has affirmed the long-term Ba2
corporate family rating, Ba2-PD probability of default rating and
Ba2 senior unsecured debt rating of Croatian national electricity
company Hrvatska Elektroprivreda d.d. The outlook remains stable.

At the same time, the rating agency has shifted the Baseline
Credit Assessment of the company, a measure of the company's
stand-alone credit strength, to ba2 from ba3, reflecting Moody's
expectation that the company will extend its track record of
maintaining solid financial metrics, despite an increasing
investment programme.

RATINGS RATIONALE

The rating affirmation and shift in the BCA reflect (1) HEP's
vertically integrated profile and leading market position in the
Croatian electricity market, enjoying around 85% market share of
sales despite increasing competition; (2) its electricity
generation mix, with a high share of low cost and low carbon
hydro and nuclear output; and (3) a strong contribution from
lower risk regulated distribution and transmission activities
contributing over half of EBITDA. The rating is in line with the
sovereign rating of Ba2 stable.

The rating additionally reflects Moody's expectation that the
company will continue to demonstrate a strong financial profile,
building on its solid track record in recent years. The current
financial profile, as reflected in funds from operations (FFO)/
net debt of 119%, is likely to weaken through a larger investment
programme than in the recent past, which includes planned new
generation capacity and investments to upgrade its ageing asset
base and expand and extend its existing networks. Nevertheless,
HEP is expected to retain robust credit metrics, such as FFO/net
debt in the strong double digits in percentage terms.

The rating nonetheless factors that HEP remains exposed to
fluctuating hydro levels and hence variable output from its
hydro-dominated fleet, which normally generates at least half of
its production. Generally the company purchases an additional 20-
40% of energy on the market to meet the balance of its supply and
trading needs. This creates some earnings volatility, as the
company's exposure to imports and more expensive input costs of
its own thermal fleet increases in dry years.

HEP's credit profile continues to reflect the company's lack of
diversification in terms of market presence. Moreover, it takes
account of a developing track record in regulation, although the
framework is less transparent and predictable than Western
European peers and certain smaller business segments, district
heating and wholesale gas, reflect clearly suboptimal returns.
The company has historically demonstrated a variable dividend
policy, and while somewhat unpredictable, its flexibility tends
to reflect the supportive stance of the government. Dividends are
likely to be more consistently paid in the future, given the
company's current strong credit metrics.

Under Moody's methodology for government related issuers, the
rating also reflects (1) HEP's 100% ownership by the Croatian
government; and (2) the strong likelihood of extraordinary
support from the government in case of financial distress at the
company, in view of its strategic importance to the Croatian
economy. At the same time, the rating takes account of the
company's exposure to domestic regulatory oversight and local
economic and financial market conditions. Given that the
company's current BCA of ba2 is aligned with that of the
sovereign rating, these factors do not provide any additional
uplift to the rating at this time.

RATIONALE FOR THE STABLE OUTLOOK

Moody's would not expect HEP's rating to be higher than that of
the government. The rating outlook is stable, in line with that
of the sovereign and reflects Moody's expectation that HEP will
continue to operate with a solid business and financial profile
commensurate with the current rating.

WHAT COULD CHANGE THE RATING UP/DOWN

Given that the ratings of HEP and the Government of Croatia are
currently aligned, Moody's does not expect any upward rating
pressures in the medium term. Positive developments in the
sovereign rating are likely to reflect positively in HEP's
rating, assuming no major deterioration in the company's business
or financial profile in the meantime.

Downward pressure could develop on HEP's rating in the event (1)
that the rating of the sovereign came under negative pressure; or
(2) of a marked deterioration in the company's financial or
liquidity profile or business risk characteristics, potentially
as a result of a more challenging operating or regulatory
environment, sufficient to prompt a shift in the BCA to b1.

A corporate family rating is an opinion of the HEP group's
ability to honour its financial obligations and is assigned to
HEP as if it had a single class of debt and a single consolidated
legal structure. The Ba2 senior unsecured rating of HEP's
outstanding global notes is the same rating level as HEP's CFR,
and reflects the absence of structural and contractual
subordination of the global note creditors to the claims of other
HEP group lenders.

Headquartered in Zagreb, Croatia, HEP is the holding company for
Croatia's incumbent vertically-integrated utility group. HEP
operates across three main segments: (i) electricity generation,
transmission, distribution and supply; (ii) district heating
generation, distribution and supply; as well as (iii) natural gas
distribution and supply. The legally and operationally separate
transmission subsidiary, HOPS d.o.o., is part of the consolidated
group. HEP demonstrated EBITDA of equivalent EUR567 million in
the twelve month period ended June 30, 2018.



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G E R M A N Y
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THYSSENKRUPP AG: Moody's Revises Outlook on Ba2 CFR to Negative
---------------------------------------------------------------
Moody's Investors Service has changed to negative from stable the
outlook on the Ba2 corporate family rating and Ba2-PD probability
of default rating of German steel and capital goods manufacturer
thyssenkrupp AG. At the same time, Moody's has affirmed these
ratings. Concurrently, the senior unsecured debt of thyssenkrupp
AG was affirmed at Ba2, including the (P)Ba2 debt issuance
programme rating. Moody's has also affirmed the short-term
ratings of tk at NP/(P)NP.

The rating action follows tk's announcement of its plan to
separate the group via a spin-off into two independent listed
companies with a different but clearer industrial focus and
direct access to the capital market. While thyssenkrupp Materials
AG (former thyssenkrupp AG) will combine the group's Material
Services business, the 50/50 joint venture with Tata Steel, the
slewing bearings and forging activities (to be spun-off from the
Components Technology division) and the marine systems business,
thyssenkrupp Industrials AG will consist of the elevator,
automotive supplier and industrial solutions businesses. The plan
foresees that existing tk shareholders will hold two shares, one
of each company, thereby holding 100% of TK Materials and a clear
majority share of TK Industrials. TK Materials will initially
hold a minority stake in TK Industrials to ensure an adequate
starting capital base, which management intends to sell to the
open market at a later point in time.

RATINGS RATIONALE

The outlook change to negative reflects Moody's view that tk's
business profile will weaken once the transaction is closed and
the current tk will become - TK Materials. It will be less
diversified than the group in its existing form and will exhibit
a greater exposure to cyclical end-markets, hence be more
vulnerable to economic shocks but also volatile steel prices.
This is shown by the group's future revenue base of around EUR18
billion vs currently EUR42 billion, albeit still sizeable, of
which some 75% will be generated by the Material Services
business, which has very low margins and exhibits highly volatile
cash flow generation. Although management expects TK Materials to
achieve a (company-adjusted) EBIT margin of around 3%, this does
not capture a still sizeable corporate cost base that Moody's
expects will continue to drag on the group's margins in the
foreseeable future.

The negative outlook further assumes that tk's leverage will
increase to higher levels than the agency had previously
projected for the existing combined group. Whilst tk's leverage
was forecasted to increase towards 5-5.5x Moody's-adjusted gross
debt/EBITDA (or 3-3.3x on a net debt basis), which is already
high for the Ba2 rating category, Moody's doubts that such levels
might be achieved by TK Materials. As the group states an
investment grade rating for its TK Industrials business, tk's
leverage (future TK Materials) will likely exceed Moody's current
guidance for a Ba2 rating, once debt is allocated between the two
new entities. tk states that it targets a Ba rating for the new
TK Materials entity.

Although Moody's understands that management aims to put in place
separate appropriate financing structures for both businesses,
the final debt allocation as well as the amount of relevant debt
adjustments (e.g. remaining pensions excluding the Steel
business, leases, factoring) remain uncertain. Moody's would also
need to perform a deeper liquidity analysis of TK Materials once
more details are available, which will be critical given the
group's expected highly volatile cash flow generation and impact
of working capital movements.

The negative outlook indicates that Moody's believes that the
future TK Materials could be weaker rated than tk's current Ba2.
The proposed transaction is subject to approval at the Annual
Shareholders' Meeting and will take 12-18 months to close. Once
the group has provided more details on its planned capital
structure, Moody's will review the impact on the credit rating,
however, this is unlikely to happen in the short-term.

OUTLOOK

The negative outlook reflects the expectation that tk's credit
metrics, including profitability, leverage and cash flow ratios,
will likely weaken as a result of the split to levels that
Moody's would not deem appropriate for the group's current
ratings.

WHAT COULD CHANGE THE RATINGS UP/DOWN

Upward pressure on the ratings would require (1) tk's liquidity
to remain strong and the ability to maintain a considerable cash
cushion, (2) gross debt/EBITDA to decrease to around 4x, and (3)
free cash flow to turn sustainably positive (all metrics are
Moody's-adjusted).

Downward pressure would build, if tk's (1) profitability
deteriorates materially from currently already weak levels (e.g.
3.5% EBITA margin), (2) gross debt/EBITDA exceeds 5.5x, and (3)
free cash flow remains consistently negative (all metrics are
Moody's-adjusted).

The methodologies used in these ratings were Global Manufacturing
Companies published in June 2017, and Steel Industry published in
September 2017.

Germany-based thyssenkrupp AG (tk) is a diversified industrial
conglomerate operating in about 79 countries. In fiscal year
ended September 2017 (FY 2016/17), tk reported sales from
continuing operations of EUR41.4 billion and generated Moody's-
adjusted EBITDA of EUR2.8 billion. The group is engaged in steel
manufacturing and steel-related services through the operations
of Steel Europe and Materials Services business areas, and in
capital goods manufacturing through the operations of Elevator
Technology, Industrial Solutions and Components Technology
business areas. Currently tk's largest shareholders are the
Alfried Krupp von Bohlen und Halbach Foundation holding around
21% of the voting rights in tk, and Cevian Capital with more than
15%.

Affirmations:

Issuer: thyssenkrupp AG

LT Corporate Family Rating, Affirmed Ba2

Probability of Default Rating, Affirmed Ba2-PD

Commercial Paper, Affirmed NP

Other Short Term, Affirmed (P)NP

Senior Unsecured MTN Program, Affirmed (P)Ba2

Senior Unsecured Regular Bond/Debenture, Affirmed Ba2

Outlook Actions:

Issuer: thyssenkrupp AG

Outlook, Changed To Negative From Stable



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I R E L A N D
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DUBLIN BAY 2018-1: DBRS Finalizes BB(low) Rating on Cl. E Notes
---------------------------------------------------------------
DBRS Ratings Limited finalized its provisional ratings of the
notes issued by Dublin Bay Securities 2018-1 DAC (DBS 2018-1 or
the Issuer) as follows:

-- Class A notes rated AAA (sf)
-- Class B notes rated AA (sf)
-- Class C notes rated A (high) (sf)
-- Class D Notes rated BBB (high) (sf)
-- Class E Notes rated BB (low) (sf)

The Class Z and R notes are not rated.

DBS 2018-1 is a bankruptcy-remote special-purpose vehicle (SPV)
incorporated in Ireland. The issued notes were used to fund the
purchase of Irish residential mortgage loans originated by Bank
of Scotland plc. and secured over properties located in Ireland.
Bank of Scotland sold the portfolio in May 2018 to Erimon Home
Loans Ireland limited, a bankruptcy-remote SPV wholly owned by
Barclays Bank plc.

As at July 30, 2018, the final mortgage portfolio consisted of
1,423 loans with a total portfolio balance of approximately EUR
260.0 million. The weighted-average (WA) loan-to-indexed value,
as calculated by DBRS giving a limited credit-to-house price
increase, is 68.7% with a WA seasoning of 11.6 years. Almost all
the loans included in the portfolio (99.98%), are floating-rate
loans linked either to the European Central Bank (ECB) rate or a
variable rate linked to ECB rate. The notes pay a floating rate
of interest linked to three-month Euribor. DBRS has accounted for
this interest rate mismatch in its cash flow analysis.
Approximately 20.8% of the portfolio is collateralized by buy-to-
let properties. No loans in the portfolio are in arrears.

Credit enhancement for the Class A notes is calculated at 19.9%
and is provided by the subordination of the Class B notes to the
Class Z notes and the general reserve fund. Credit enhancement
for the Class B notes is calculated at 14.9% and is provided by
the subordination of the Class C notes to the Class Z notes and
the general reserve fund. Credit enhancement for the Class C
notes is calculated at 12.1% and is provided by the subordination
of the Class D notes to the Class Z notes and the general reserve
fund. Credit enhancement for the Class D notes is calculated at
9.6% and is provided by the subordination of the Class E notes,
Class Z notes and the general reserve fund. Credit enhancement
for the Class E notes is calculated at 6.0% and is provided by
the subordination of the Class Z notes and the general reserve
fund.

The transaction benefits from a cash reserve that is available to
support the Class A to Class E notes. The cash reserve will be
fully funded at close at 1.5% of the initial balance of the rated
notes less the liquidity reserve fund. The liquidity reserve fund
is sized at 1.5% of the Class A balance and provides liquidity
support to cover revenue shortfalls on senior fees, Class X1
payment and interest on the Class A notes. The notes will
additionally be provided with liquidity support from principal
receipts, which can be used to cover interest shortfalls on the
most senior class of notes, provided a debit is applied to the
principal deficiency ledgers in reverse sequential order.

A key structural feature is the provisioning mechanism in the
transaction, which is linked to the arrears status of a loan
besides the usual provisioning based on losses. The degree of
provisioning increases with the increase in number of months in
arrears status of a loan. This is positive for the transaction as
provisioning based on the arrears status will trap any excess
spread much earlier for a loan, which may ultimately end up in
foreclosure.

The Issuer Account Bank, Paying Agent and Cash Manager is
Citibank, N.A., London Branch. The DBRS private rating of the
Issuer Account Bank is consistent with the threshold for the
Account Bank outlined in DBRS's "Legal Criteria for European
Structured Finance Transactions" methodology, given the ratings
assigned to the notes.

The rating assigned to the Class A notes addresses the timely
payment of interest and ultimate payment of principal on or
before the final maturity date. The ratings assigned to the Class
B to Class E notes address the ultimate payment of interest and
principal. DBRS based its ratings primarily on the following:

   -- The transaction capital structure, form and sufficiency of
      available credit enhancement and liquidity provisions.

   -- The credit quality of the mortgage loan portfolio and the
      ability of the servicer to perform collection activities.
      DBRS calculated the probability of default (PD), loss given
      default (LGD) and expected loss (EL) outputs on the
      mortgage loan portfolio.

   -- The ability of the transaction to withstand stressed cash
      flow assumptions and repays the rated notes according to
      the terms of the transaction documents. The transaction
      cash flows were analyzed using PD and LGD outputs provided
      by the "Master European Residential Mortgage-Backed
      Securities Rating Methodology and Jurisdictional Addenda"
      methodology. Transaction cash flows were analyzed using
      INTEX DealMaker.

   -- The structural mitigants in place to avoid potential
      payment disruptions caused by operational risk, such as
      downgrade and replacement language in the transaction
      documents.

   -- The transaction's ability to withstand stressed cash flow
      assumptions and repay investors in accordance with the
      Terms and Conditions of the notes.

   -- The legal structure and presence of legal opinions
      addressing the assignment of the assets to the Issuer and
      consistency with DBRS's "Legal Criteria for European
      Structured Finance Transactions" methodology.

Notes: All figures are in euros unless otherwise noted.


HALCYON LOAN 2016: Fitch Assigns B-(EXP) Rating to Class F Notes
----------------------------------------------------------------
Fitch Ratings has assigned Halcyon Loan Advisors European Funding
2016 DAC notes expected ratings, as follows:

EUR3 million Class X: 'AAA(EXP)sf'; Outlook Stable

EUR219 million Class A-1: 'AAA(EXP)sf'; Outlook Stable

EUR10 million Class A-2: 'AAA(EXP)sf'; Outlook Stable

EUR23.1 million Class B-1: 'AA(EXP)sf'; Outlook Stable

EUR11.4 million Class B-2: 'AA(EXP)sf'; Outlook Stable

EUR23 million Class C: 'A(EXP)sf'; Outlook Stable

EUR26 million Class D: 'BBB-(EXP)sf'; Outlook Stable

EUR20.5 million Class E: 'BB-(EXP)sf'; Outlook Stable

EUR11 million Class F: 'B-(EXP)sf'; Outlook Stable

EUR36.5 million subordinate notes: 'NR(EXP)sf'

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

Halcyon Loan Advisors European Funding 2016 DAC is a cash flow
collateralised loan obligation (CLO), which originally closed in
August 2016. Proceeds from the issue of new refinancing notes
will be used to refinance the existing notes. The issuer has
amended the capital structure and extended the maturity of the
notes. Fitch did not rate the transaction at closing.

The collateral portfolio comprises mostly European leveraged
loans and bonds and is actively managed by Halcyon Loan Advisors
(UK) LLP. The CLO envisages a reinvestment period of 4.25-year
reinvestment period and a 8.5-year weighted average life (WAL).

KEY RATING DRIVERS

'B' Portfolio Credit Quality

Fitch places the average credit quality of obligors in the 'B'
range. The Fitch weighted average rating factor of the current
portfolio is 33.4.

High Recovery Expectations

At least 90% of the portfolio comprises senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch-weighted average recovery rate (WARR) of the
current portfolio is 63.6%

Diversified Asset Portfolio

The covenanted maximum exposure to the top 10 obligors for
assigning the expected ratings is 18% of the portfolio balance.
The transaction also includes limits on maximum industry exposure
based on Fitch's industry definitions. The maximum exposure to
the three largest (Fitch-defined) industries in the portfolio is
covenanted at 40%. These covenants ensure that the asset
portfolio will not be exposed to excessive concentration.

Adverse Selection and Portfolio Management

The transaction features a 4.25-year reinvestment period and
includes reinvestment criteria similar to other European
transactions. Fitch's analysis is based on a stressed-case
portfolio with the aim of testing the robustness of the
transaction structure against its covenants and portfolio
guidelines.

Cash Flow Analysis

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

Limited Interest Rate Risk

Up to 10% of the portfolio can be invested in unhedged fixed-rate
assets, while fixed-rate liabilities represent 3.1% of the target
par. Fitch modelled both 0% and 10% fixed-rate buckets and found
that the rated notes can withstand the interest rate mismatch
associated with each scenario.

RATING SENSITIVITIES

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

DATA ADEQUACY

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

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



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


ITALY: Spending Plans Lead to Nervousness in Financial Markets
--------------------------------------------------------------
BBC News reports that the controversy surrounding the Italian
government's spending plans has led to continued nervousness on
the financial markets.

According to BBC, the budget set out by the country's coalition
government last month -- which involves greater spending than
previously planned -- had already sent Italian share prices lower
and knocked the value of the euro.

The cost of government borrowing for Italy, represented by the
yield (or interest rate) on its bonds (the debt issued by the
Italian government), has been rising, demonstrating that
investors are getting twitchy, BBC discloses.

Markets are concerned that the government's plans mean the
country is heading for a stand-off with the European Commission,
BBC states.

                           Economy

According to BBC, the government's ambitions to spend more are
set against the sober backdrop of Italy's persistently weak
economic growth record.

The determination to deliver on their election promises and that
weak growth has once again raised questions about the
sustainability of the country's debts, BBC says.

There could also be legal action taken by the European
Commission, BBC relays.

                               Debt

In cash terms, Italy's debt is the biggest government debt in the
EU at EUR2.3 trillion (US$2.6 trillion; GBP2 trillion), BBC
notes.  The debt burden as a percentage of annual economic
activity is second only to Greece in the EU at 132%, according to
BBC.

                              Banks

Capital Economics, the London consultancy says the banks "remain
the country's weakest link", BBC relates.

They own more than a quarter of Italian government debt, so they
would be hit hard by a default, BBC discloses.  Even the rise in
bond yields, which means the value of the bonds falls, is bad
news for them, BBC states.  They also have high levels of problem
loans, according to BBC.

                         Armageddon scenario?

There are two.  One is a default by the Italian government -- a
failure to repay debts as they come due, BBC says.  The other is
leaving the euro, BBC relays.

But neither is on the horizon with Italy, according to BBC.
Although government borrowing is getting more expensive, it is
much cheaper than the levels seen as triggering the need for a
bailout, BBC states.  Italy did get into that territory in the
worst phase of the eurozone crisis, but is not close to that now,
BBC notes.


ITALY: Fiscal Problems Fuel Concern of Contagion Risks in EU
------------------------------------------------------------
John Ainger at Bloomberg News reports that the latest collision
between Italy's markets and politics is beginning to fuel concern
that shock waves could spread to elsewhere in Europe.

As Italian bond yields touched a four-year high, the euro
extended losses and the region's equities slumped, while haven
assets such as German bunds and the Swiss franc rallied,
Bloomberg relates.  Goldman Sachs Group Inc. warned that the risk
of a wider impact of the Italian turmoil has increased, even as
markets in Spain and Portugal -- seen as a key barometer for any
debt contagion to Europe's periphery -- have so far shown little
sign of anxiety, Bloomberg discloses.

According to Bloomberg, budget official Claudio Borghi's comments
that the common currency is "not sufficient" to solve the
country's fiscal problems have rekindled worries that a breakup
of the world's largest trade bloc is still a possibility.

"European risky assets remain vulnerable and there is potential
for negative spillovers to the euro area given the high trade
exposure to Italy," Bloomberg quotes Goldman Sachs strategists
led by Alessio Rizzi as saying in a research note.  "While our
economists do not expect systemic implications for the global
economy, contagion risks have risen."

Markets were firmly in risk-off mode on Oct. 2, with demand
rising for popular risk hedges, Bloomberg recounts.  Italy's
two-year bonds took the brunt of the selling pressure, flattening
the country's yield curve, Bloomberg notes.  The cost of
protection against a potential credit default by the nation rose
and traders priced in a greater premium for three-month money-
market borrowings over overnight loans, Bloomberg relays.

"Political developments in Italy are still center-stage and will
probably continue to remain the most critical driver for the euro
for the time being," Bloomberg quotes analysts at UniCredit SpA
as saying in a note. "Still, contained contagion in the bond
markets implies that the budget talks are still perceived as a
"local" issue.  The market behavior suggests to us that the
Italian developments are likely to just add "noise" to the common
currency at the moment, but are not seen as grave enough to
trigger a heavy sell-off."



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


BREEZE FINANCE: Fitch Affirms CCC Rating on Class A Bonds
---------------------------------------------------------
Fitch Ratings has affirmed Breeze Finance's class A bonds at
'CCC' and the class B bonds at 'CC'. The bonds are backed by
revenue from a portfolio of onshore wind farms predominantly
located in Germany, and to a lesser extent in France.

The ratings consider potentially insufficient cash in the debt
service reserve account (DSRA) to service the bonds until
maturity, indicating that default has become a real possibility.
No drawdowns were made on the Class A DSRA over the last 12
months. However, further drawdowns are expected in the future.

KEY RATING DRIVERS

Revenue underperformance has continued as a result of
consistently below-expected wind yields, despite the benefit of
fixed feed-in tariffs. Fitch expects ongoing cash-flow pressure
due to a rise in operating and maintenance costs and decrease in
turbine availability as the assets age.

The equally sized semi-annual principal repayments in any given
year do not take into account wind seasonality, which results in
less cash being available for the autumn debt service. The class
B DSRA has no funds and the class A DSRA is partially depleted.
Its forecasts indicate that neither DSRA will be replenished as
flows into them are subordinated to the repayment of class B bond
deferrals, currently EUR41.5 million or around 50% of the
original class B notional. Fitch perceives a default as probable
for the class B notes.

Increased Maintenance on Aging Turbines - Operation Risk: Weaker
Historically, turbine availability has been high, around 96.5%
for the last 12 months and a historical average of around 96.0%.
Breeze Finance SA has demonstrated better cost control in recent
years. However, Fitch expects a rise in operating and maintenance
costs and a decrease in turbine availability as the assets enter
the final seven years of their 20 year expected life. Fitch also
views the absence of a performance incentive for the operator as
credit-negative.

Continued Wind Yield Underperformance - Volume Risk: Weaker
The initial wind study grossly overestimated Breeze Finance SA's
wind resources. Fitch views historical data as a more reliable
basis for its volume projections, given that actual wind has led
to average revenue being well below P90 revenue.

Limited Exposure to Merchant Pricing - Price Risk: Midrange
The wind farms are remunerated through fixed feed-in-tariffs
embedded in the German and French energy regulations. German
tariffs are set for 20 years and French tariffs for 15 years.
During the final years before debt maturity, the project is
exposed to increasing merchant risk, with a significant exposure
towards the end of the debt's life. This leaves the project with
a degree of exposure to merchant pricing in the last years before
debt maturity, and Fitch, this year, has used its own pricing
assumptions to derive the revenues for German wind farms.

Partially Depleted DSRA on Class A - Debt Structure: Midrange
Rising Deferrals on Class B - Debt Structure: Weaker
The class A bonds are senior, fully amortising and fixed rate.
However, equally sized semi-annual principal repayments in any
given year do not take into account summer and winter wind
seasonality and therefore weaken the structure. Fitch expects
liquidity to remain tight due to the low volumes and increasing
costs. Following several drawdowns, the DSRA currently stands at
EUR11.4 million versus the initial balance of EUR14.1 million.

DSRA replenishment is subordinated to the repayment of deferrals
on the class B bond principal and thus unlikely in its view.
Additional drawings on the class A DSRA would further affect the
debt structure and Fitch expects that, under its current
assumptions, it would be depleted before debt maturity.

The class B DSRA is depleted and scheduled payments on the class
B bonds were repeatedly deferred over the years. Even though some
deferrals were repaid occasionally, Fitch expects that further
deferrals will accrue over the coming years. Fitch views as
unlikely a repayment of this balance prior to the class A bonds
maturing due to the subordination and poor cash-flow generation.

Financial Profile

Fitch's rating case produces average and minimum annual debt
service coverage ratios (DSCRs) of 1.16x and 0.83x, respectively,
for the class A bonds (DSCR until 2023 is 0.95x/ 0.83x),
underlining a lack of financial cushion. Under its current
assumptions, Fitch expects that the class A DSRA will be fully
depleted before debt maturity.

Fitch estimates the repayment of the class B deferrals would
require wind yields to significantly exceed the historical
average over the remaining life of the debt.

PEER GROUP

As with Breeze Finance SA, CRC Breeze Finance SA consists of a
portfolio of onshore wind farms predominantly located in Germany
and, to a lesser extent, in France. As a result they share the
same regulatory framework, with fixed feed-in-tariffs. They have
equally suffered from considerable over-estimation of their wind
resources. Additionally, the seasonality of wind yield, combined
with equal semi-annual principal repayments, has led to
shortfalls at the autumn payment dates. This has resulted in
deferrals on the class B notes and drawings on the class A DSRA
for both transactions.

Compared with Breeze Finance SA whose class B bonds mature in
2027, CRC Breeze Finance SA's class B scheduled maturity is 2016
but payments can be deferred until the class A bonds reach their
maturity in 2026. However, Fitch does not see this as a
significant benefit relative to Breeze Finance SA, as the high
amount of deferrals, their subordination to the class A notes and
the fully depleted class B DSRA mean a full repayment of the
class B bonds remains unlikely. Fitch believes that the ratings
of the two transactions should be aligned as a result, at 'CCC'
for the class A notes and 'CC' for the class B notes.

RATING SENSITIVITIES

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

  - Class A: weak wind conditions, a material decline in
    availability or a lasting increase in operating costs
    triggering further significant drawdowns on the class A DSRA.

  - Class B: default becoming imminent or inevitable.

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

  - Class A: an upgrade at this point appears unlikely.

  - Class B: an upgrade at this point appears unlikely

CREDIT UPDATE

Performance Update

Availability has remained high over its review period, and the
last DSRA drawdown took place in April 2017. This is because the
improved production data for 2017 and a higher cost control
during first half of 2018.

Fitch Cases

Fitch's base and rating cases are based on historical average
revenues until 2017. This assumption changes over time in Fitch's
reviews, as the project yields more historical data. Fitch's
rating case also includes an additional 15% stress on costs.

Asset Description

Breeze Finance SA is a Luxembourg SPV that issued three classes
of notes on April 19, 2007 for an aggregate issuance amount of
EUR455 million to finance the acquisition and completion of a
portfolio of wind farms located in Germany and France, as well as
establishing various reserve accounts. The notes are repaid from
the cash flow generated by the sale of the energy produced by the
wind farms, mainly under regulated tariffs.


CRC BREEZE: Fitch Affirms CCC Rating on Class A Notes
-----------------------------------------------------
Fitch Ratings has affirmed CRC Breeze Finance S.A.'s, class A
notes at 'CCC' and class B notes at 'CC'.

The ratings consider potentially insufficient cash in the debt
service reserve account (DSRA) to service the bonds until
maturity, indicating that default has become a real possibility.
The drawdowns under the DSRA were below Fitch's expectations
given the good winter for wind farms' production, but drawdowns
still occurred in 2H17, and continued to deplete the DSRA, with
funding below 50% of the target balance.

KEY RATING DRIVERS

Revenue under-performance has continued as a result of wind yield
consistently below expectations, despite benefiting from fixed
feed-in tariffs. Fitch expects continued cash flow pressure due
to a rise in operating and maintenance costs and a decrease in
turbine availability as the assets age.

The equally sized semi-annual principal repayments in any given
year do not take into account wind seasonality, which results in
less cash being available for the autumn debt service. The class
B DSRA has no funds and the class A DSRA is partially depleted.
Its forecasts indicate that neither DSRA will be replenished as
flows into them are subordinated to the repayment of the class B
bond deferrals, currently EUR25.3 million or approximately 50% of
the original class B notional. Fitch perceives a default as
probable for the class B notes.

Increased Maintenance on Aging Turbines - Operation Risk: Weaker
Historically, turbine availability has met or exceeded Fitch's
expectation of 96.5%. CRC Breeze Finance SA has demonstrated
better cost control in recent years. However, Fitch expects a
rise in operating and maintenance costs and a decrease in turbine
availability as the assets enter the second half of their 20-year
expected life. Fitch continues to view the change in operational
management at the issuer level, to WPD Windmanager from Theolia
in July 2015, as an additional source of uncertainty. Fitch also
views the absence of a performance incentive for the operator as
credit negative.

Continued Wind Yield Underperformance- Volume Risk: Weaker
The initial wind study grossly overestimated CRC Breeze Finance
SA's wind resources. A 2010 study revised the P90 wind forecast
down by 13%. However, actual wind yields have under-performed the
revised wind estimates. Fitch now views historical data as a more
reliable basis for its volume projections, with an historical
average wind yield 15% below the initial P90 figure, and
approximately 3% below the revised P90.

Limited Exposure to Merchant Pricing - Price Risk: Midrange
The wind farms are remunerated through fixed feed-in-tariffs
embedded in the German and French energy regulations. German
tariffs are set for 20 years and French tariffs for 15 years.
During the last three to four years of the debt, it will be
exposed to merchant risk, increasing to approximately 23% of the
portfolio's capacity at the last payment date in May 2026 from
approximately 10% in 2023.

Partially Depleted DSRA on Class A - Debt Structure: Midrange
Large Deferrals on Class B - Debt Structure: Weaker
The class A bonds are senior, fully amortising and fixed-rate.
However, equally sized semi-annual principal repayments in any
given year do not take into account summer and winter wind
seasonality and therefore weaken the structure. Fitch expects
liquidity to remain tight due to low volumes and increasing
costs. Following several drawdowns, the DSRA currently stands at
EUR6.5 million versus the initial balance of EUR13.3 million.
DSRA replenishment is unlikely due to it being subordinated to
the repayment of the entire deferral balance on the class B
bonds. Under its current assumptions, Fitch expects it will be
depleted years before debt maturity.

The class B DSRA is depleted and scheduled payments on the class
B bonds were repeatedly deferred over the years. The last
scheduled instalment was in May 2016, and a total of EUR25.3
million of principal and interests or 50% of the original
notional of the class B had been deferred. Fitch views as
unlikely a full repayment of this balance prior to the class A
bonds maturing due to the subordination and weak cash flow
generation.

Financial Profile

Fitch's rating case produces average and minimum debt service
coverage ratios (DSCRs) of 0.92x and 0.73x, respectively, for the
class A bonds, underlining the lack of financial cushion. As a
result, Fitch expects further drawdowns on the partially depleted
class A DSRA. Fitch concludes that cash in the DSRA may be
insufficient to service the class A bonds until maturity.

Fitch estimates the repayment of the class B deferrals would
require wind yields to significantly exceed the historical
average over the remaining life of the debt.

PEER GROUP

Like Breeze Finance SA, CRC Breeze Finance SA consists of a
portfolio of onshore wind farms predominately located in Germany
and, to a lesser extent, in France. As a result they share the
same regulatory framework, with fixed feed-in-tariffs. They have
equally suffered from considerable over-estimation of their wind
resources. Additionally, the seasonality of wind yield, combined
with equal semi-annual principal repayments, has led to
shortfalls at the autumn payment dates. This has resulted in
deferrals on the class B notes and drawings on the class A DSRA
for both transactions.

Compared with Breeze Finance SA, whose class B bonds mature in
2027, CRC Breeze Finance SA class B's scheduled maturity is 2016
but payments can be deferred until the class A bonds reach their
maturity in 2026. However, Fitch does not see this as a
significant benefit relative to Breeze Finance SA as the high
amount of deferrals, their subordination to the class A notes and
the fully depleted class B DSRA mean a full repayment of the
class B bonds remains unlikely. Fitch believes that the ratings
of the two transactions should be aligned as a result, at 'CCC'
for the class A notes and 'CC' for the class B notes.

RATING SENSITIVITIES

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

  - Class A: weak wind conditions, a material decline in
    availability or a lasting increase in operating costs
    triggering further significant drawdowns on the class A DSRA.

  - Class B: default becoming imminent or inevitable.

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

  - An upgrade of either class appears unlikely at this point.

CREDIT UPDATE

Performance Update

Production during the beginning of 2017 was not good, continuing
the 2016 trend, but the wind conditions in the 2017 winter were
really favourable. However, additional drawdowns on the class A
DSRA occurred over the last 12 months. CRC Breeze Finance SA is
in discussion to amend the operating and maintenance set-up and
make cost savings. However, implementation of the plan remains
uncertain.

Fitch Cases

Fitch's base and rating cases are based on historical average
production until 2017. This assumption changes over time in
Fitch's reviews, as CRC Breeze Finance SA yields more historical
data. Fitch's rating case also includes an additional 15% stress
on costs.

Asset Description

CRC Breeze Finance SA is a Luxembourg special purpose vehicle
that issued three classes of notes on May 8, 2006 for an
aggregate issuance amount of EUR470 million to finance the
acquisition and completion of a portfolio of wind farms located
in Germany and France, as well as establishing various reserve
accounts. The notes are scheduled to be repaid from the cash flow
generated by the sale of the energy produced by the wind farms,
mainly under regulated tariffs.



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


FIAT CHRYSLER: DBRS Hikes Issuer Rating to BB(high)
---------------------------------------------------
DBRS Limited upgraded the Issuer Rating and Senior Unsecured Debt
rating on Fiat Chrysler Automobiles N.V. (FCA or the Company) to
BB (high) from BB (low). DBRS also revised the recovery rating on
the Company's Senior Unsecured Debt to RR3 from RR4. All trends
are Stable. The upgrade is based, in large part, on FCA's strong
earnings/cash flow generation and sizable debt reduction, which
have strengthened its financial risk assessment (FRA) to levels
meaningfully above the previously assigned ratings. This rating
action also resolves the Under Review with Developing
Implications status, initially assigned on January 16, 2017, and
subsequently maintained on January 16, 2018.

The ratings were initially placed Under Review with Developing
Implications following the U.S. Environmental Protection Agency's
announcement that it had issued a notice of violation of the
Clean Air Act to FCA in connection with the Company's 2014-2016
model year light-duty vehicles sold in the United States and
equipped with 3.0-litre diesel engines (the Diesel Issue).
Moreover, in May 2017, the U.S. Department of Justice filed a
civil lawsuit against FCA in connection with the Diesel Issue.
DBRS acknowledges that these actions have yet to be settled,
which could ultimately entail the imposition of consequential
fines and/or penalties, among other matters. Moreover, it remains
uncertain when or under what terms the Diesel Issue will be
resolved; however, DBRS recognizes that the Company's credit
metrics and, notably, its balance sheet have improved
substantially since the onset of the Diesel Issue. This is
demonstrated by sizable debt repayments, under which consolidated
industrial indebtedness decreased to EUR 14.5 billion as of June
30, 2018, from EUR 22.5 billion as of YE2016. Additionally, FCA's
liquidity remains strong, exceeding EUR 21 billion as of June 30,
2018. As such, DBRS notes that the Company's credit metrics have
enough cushions to absorb any foreseeable penalty stemming from
the Diesel Issue and remain in line with the upgraded ratings,
which enables DBRS to resolve the Under Review status in advance
of the Diesel Issue's conclusion.

Furthermore, the Company's earnings continue to trend positively,
despite slight softening in Q2 2018 caused by weaker demand in
China, in line with import-duty reductions effective July 2018
which postponed vehicle purchases. Performance remained solid in
the core NAFTA region where the operating margin was 8% in Q2
2018. Going forward, earnings are anticipated to benefit further
from higher forecasted global vehicle demand amid a firmer sales
mix (reflecting additional growth in Jeep, Ram, Maserati and Alfa
Romeo). Cost headwinds are also estimated to be partly offset by
increasing platform consolidation and related scale/purchasing
efficiencies as well as through additional manufacturing
efficiencies.

While FCA faces headwinds including commodity cost pressures and
tightening emissions controls, among others, its materially
stronger FRA provides cushion against unexpected challenges even
at the newly upgraded ratings level, thereby making a negative
rating action unlikely. Additionally, a resolution of the Diesel
Issue on terms DBRS considers reasonable and/or continued
strengthening credit metrics would likely result in additional
positive rating actions.


MATTRESS FIRM: Files Voluntary Chapter 11 Bankruptcy Petition
-------------------------------------------------------------
Steinhoff International Holdings N.V. (the "Company" and with its
subsidiaries, the "Group") on Oct. 5 disclosed that its
subsidiary Mattress Firm, Inc., North America's leading specialty
mattress retailer, along with its U.S. subsidiaries (together,
"Mattress Firm"), is taking steps to implement a pre-packaged
plan of reorganisation that, among other things, provides
Mattress Firm access to new financing to support its business and
establishes an efficient and orderly process for closing certain
underperforming store locations in the United States by filing
voluntary Chapter 11 cases in the United States Bankruptcy Court
for the District of Delaware (the "Mattress Firm Filing").  The
Mattress Firm Filing supports actions to strengthen its balance
sheet and optimise its store footprint and is a further step in
the on-going debt restructuring of the Steinhoff Group (the
"Group Restructuring") and is designed to accelerate the
turnaround of the Mattress Firm business.

Mattress Firm is continuing to serve customers as usual at stores
and online.  Mattress Firm has filed a number of customary "first
day" motions with the court seeking authorisation to support its
operations during the recapitalisation process.  These include
motions for authority to continue to honor secured creditors and
customer programs, pay employee wages, health and welfare
benefits, and pay contractor partners and vendors in full.

Through the Mattress Firm Filing and in order to facilitate the
store optimisation plan, Mattress Firm is seeking the authority
to reject up to 700 leases.  An initial group of approximately
200 stores is expected to be closed in the next few days.
Decisions about additional store closings will be made in the
weeks ahead.

In conjunction with its pre-packaged plan, Mattress Firm received
a commitment for approximately $250 million in debtor-in-
possession financing (the "DIP Financing"), which, subject to
court approval, will be available to partly repay Mattress Firm's
ABL facility and support its ongoing operations during the
Chapter 11 proceedings.  The DIP Financing has a three-month
term, and Mattress Firm expects to complete the pre-packaged
restructuring process within the next 45 to 60 days.

Mattress Firm also secured a commitment for a four-year term loan
of $400 million of exit financing (the "Exit Term Loan") and an
ABL facility of $125 million (together, the "Exit Financing")
underwritten by a number of Steinhoff Europe AG creditors.  The
proceeds of the Exit Financing will be utilized to repay the DIP
Financing, repay Mattress Firm's ABL facility (to the extent not
already repaid out of the proceeds of the DIP Financing), repay
the outstanding approximately $84 million intercompany loan
(incl. accrued and unpaid interest) from the Company to Mattress
Firm (put in place in March 26, 2018), to pay costs associated
with the pre-packaged plan (including the estimated store closure
costs), transaction fees and otherwise to provide working
capital.

In connection with the Exit Financing, the Group has agreed
certain other arrangements in relation to the equity and debt
structure of the Mattress Firm sub-group:

   -- Exit Lender equity - On emergence from Chapter 11, the Exit
Term Loan lenders (the "ETL Lenders") will receive 49.9% of the
equity in Stripes US Holding, Inc. ("SUSHI") or Mattress Firm
Holdco, Inc. (the "Issuing MF Company") at no cost (with the
Group retaining a 50.1% equity interest (held by the "Group
Shareholder"), together with related shareholder rights including
governance rights (see below) and, subject to customary terms and
conditions, sale rights with the ability to bring-along a pro
rata portion of the Group's retained equity interest.

  -- Exit Lender PIK debt - There will be a $150 million payment
in kind loan which will become repayable by SUSHI upon a five-
year maturity.

  -- Management Incentive Plan - Subject to determination of the
number of participants and appropriate time, performance and
hurdle rate vesting conditions, a management incentive plan
("MIP") will be put in place. Awards under the plan can be made
in respect of 10% of the common equity in the Issuing MF Company
(which would be dilutive of the interests of both the Group
Shareholder and the ETL Lenders) and 10% of the Exit Lenders' PIK
debt.

  -- Governance - The Issuing MF Company's board will comprise
five members, including three members proposed by the ETL Lenders
(with the Group Shareholder having certain limited rights to
reject any nominee of the ETL Lenders).

Danie van de Merwe of Steinhoff International Holdings N.V. said:
"Mattress Firm has been facing significant operational challenges
which management is addressing through its turnaround plan.
Considering the Group's current position, we believe the Mattress
Firm recapitalisation is the best way to support and accelerate
the turnaround plan so as to ensure a future for Mattress Firm
and its employees and unlock value for shareholders over time.
The Mattress Firm recapitalisation also represents a further
positive step in the wider Steinhoff restructuring process."

      Implications for the Group and the Group Restructuring

The Mattress Firm Filing does not directly impact the other
operating businesses of the Group and is not expected to have any
material effect on the trading of these operations.

As part of the Mattress Firm restructuring, the Company's equity
ownership in SUSHI has been contributed to SEAG prior to the
Mattress Firm Filing.  Steps to transfer or novate the SUSHI RCF
debt with SEAG debt will be taken in the near future to replicate
the proposals under the lock up agreement entered into in respect
of the restructuring and to reflect the economic interests within
the SEAG debt cluster.  To implement the Mattress Firm
restructuring prior to exit, the intercompany loans will be
contributed as capital by the relevant entities into SEAG and the
guarantees from Mattress Firm Inc. to these loans will be
released.  Following such restructuring and as a result of the
proposed equity issuance to the ETL Lenders, SEAG will own 50.1%
in SUSHI.  The relevant lender consents in connection with such
restructuring have been obtained.

The Group Restructuring otherwise continues in accordance with
the terms of the lock-up agreement entered into by the Company on
11 July 2018, and the Company will continue to provide updates as
appropriate.

Shareholders and other investors in the Company are advised to
exercise caution when dealing in the securities of the Group.

                   About Steinhoff International

Steinhoff International Holdings NV's registered office is
located in Amsterdam, Netherlands

                          About Mattress Firm

Founded in 1986, Mattress Firm -- https://www.mattressfirm.com --
is a specialty mattress retailer headquartered in Houston, Texas,
operating more than 3,230 stores across 49 states (including
franchise locations).  Mattress Firm offers a broad selection of
mattress products and bedding accessories from leading
manufacturers and brand names, including Serta, Simmons, tulo,
Sleepy's, Chattam & Wells and Purple.


PROMONTORIA HOLDING: Moody's Assigns B2 CFR, Outlook Stable
-----------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating
to Promontoria Holding 264 B.V. following the acquisition of the
group by funds controlled by private equity firm Cerberus.
Moody's has also affirmed the B2 rating of the EUR660 million
senior secured notes issued by Promontoria. Outlook to all the
ratings at Promontoria level is stable. Concurrently, Moody's
withdrew the B3 corporate family rating and the B3-PD probability
of default rating of WFS Global Holding S.A.S. The B3 rating of
its existing EUR375m Senior Secured Notes and the Caa2 rating of
its existing EUR140m Senior Unsecured Notes are unchanged,
Moody's expects them to be withdrawn upon planned repayment.

RATINGS RATIONALE

The B2 corporate family rating reflects Promontoria's (i) strong
position in the cargo business as the largest independent global
cargo handler, which is complemented by its trucking network
across Europe and somewhat high barriers to entry given the
limited supply of on-airport warehouses; (ii) good geographical
diversification with revenues evenly split between Europe and the
Americas; and (iii) a relatively stable client base and good
track record in contract renewal, offsetting some customer
concentration to the Air France -- KLM group and American
Airlines representing around 16% of revenues.

However, the rating also reflects the company's (i) core cargo
business' exposure to economic and international trade
cyclicality; (ii) airline customer base and competitive nature of
the industry which is causing price pressure and consolidation;
(iii) moderately high lease adjusted debt to EBITDA of around
4.5x as expected by year-end 2018 and (iv) historical non-
recurring costs.

The B2 rating also reflects Moody's expectation that non-
recurring costs will reduce substantially in 2018. In the first 6
months of 2018 WFS charged EUR4 million of restructuring and
other non-recurring items - a notable decrease compared to EUR
12.7 million in the first 6 months of 2017. The rating also
assumes that the new owner will continue to focus on operational
improvements including labour related initiatives and investments
in technology and that the contribution to revenues from ground
handling activities will remain relatively unchanged with
commercial efforts targeting high volume narrow bodied dominated
airports. The rating also reflects a lower cost of debt compared
to the existing capital structure with EBITA to Interest
improving to around 1.8x from 1.2x.

The calculation of Moody's adjusted leverage is based on an
assumption of continued operating lease capitalization at the
standard 3x multiple to rent expense, which may be affected by
the new IFRS 16 standard for leases.

LIQUIDITY

Moody's views WFS's liquidity as adequate. The company benefits
from EUR57.5 million availability under its EUR 100 million RCF
post drawdowns and letters of credit utilisation. In addition,
free cash flow generation is expected to improve due to a lower
cost of debt assumed and a reduction of non-recurring costs.
Moody's expects RCF/Debt as defined by Moody's in the 10%-15%
range. The company will also benefit from a longer debt maturity
profile pro-forma for the refinancing.

STRUCTURAL CONSIDERATIONS

The EUR 660 million senior secured notes due 2023 (rated B2 and
comprising 6.75% EUR400 million fixed rate and 6.25%+EURIBOR
EUR260 million floating notes) share the same security and
guarantees as the EUR100 million RCF (unrated). The security
includes share pledges in subsidiaries, intragroup receivables
due to subsidiaries, and cash. However, the notes rank behind the
RCF due to contractual subordination via the intercreditor
agreement in case of enforcement. This leads to an outcome in
which the Senior Secured Notes are rated at the same level of the
CFR, since the senior secured debt accounts for the vast majority
of modelled debt.

The ratings also incorporate its understanding that the
shareholder funding into the restricted group is wholly via
common equity.

RATIONALE FOR STABLE OUTLOOK

The stable outlook reflects its expectation of a gradual
deleveraging of the business based on maintaining or growing its
market share in a reasonably stable market environment and
achieving positive FCF in the context of lower cost of debt and
reduced exceptional costs. The outlook also incorporates an
expectation that the company will maintain a sufficient liquidity
cushion, including access to EUR100 million of Revolving Credit
Facility (RCF). The outlook does not take into account any
further material debt funded acquisition nor any potential
shareholder friendly actions.

WHAT COULD CHANGE THE RATING UP/DOWN

Moody's could over time consider upgrading the rating if there is
a visible improvement in gaining further scale and
diversification as well as strengthening its operating
performance. Quantitatively, positive pressure could materialise
if the company's (1) adjusted leverage decreases below 4.0x; and
(2) EBITDA / Interest increase towards 2.5x; and (3) FCF / debt
improves towards 5%.

Moody's would consider downgrading the rating if the company's
liquidity profile and credit metrics deteriorate as a result of a
weakening of its operational performance, acquisitions, or a
change in its financial policy. Quantitatively, negative pressure
could materialize if the company's (1) Moody's-adjusted
debt/EBITDA ratio increases towards 5x, (2) EBITA / Interest
falls below 1.5x or (3) FCF remains negative for the next 12-18
months.

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

Promontoria is a global aviation services company principally
focused on cargo handling (71% of last twelve months revenues
ended June 30, 2018) and ground handling (25%), with a small
presence in Transport Infrastructure Management & Services (TIMS,
4%). For the twelve months ended June 30, 2018, WFS reported
total revenues of EUR1,248 million and EBITDA as adjusted by the
company of EUR138 million. As of June 30, 2018, WFS operated at
199 airports in 22 countries and served over 270 airlines
worldwide.

Assignments:

Issuer: Promontoria Holding 264 B.V.

Corporate Family Rating, Assigned B2

Probability of Default Rating, Assigned B2-PD

Affirmations:

Issuer: Promontoria Holding 264 B.V.

Backed Senior Secured Regular Bond/Debenture, Affirmed B2

Withdrawals:

Issuer: WFS Global Holding S.A.S.

Corporate Family Rating, Withdrawn , previously rated B3, under
review for upgrade

Probability of Default Rating, Withdrawn , previously rated B3-
PD, under review for upgrade

Outlook Actions:

Issuer: Promontoria Holding 264 B.V.

Outlook, Changed To Stable From No Outlook



===========
P O L A N D
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GETBACK SA: Posts PLN1.12-Bil. Net Loss in First Half 2018
----------------------------------------------------------
Posadzy Magdalena at Polska Agencja Prasowa reports that listed
defunct debt collector GetBack said in a market filing with
preliminary unaudited H1 financial statement that the company
likely suffered a PLN1.12 billion consolidated net loss in the
first half of 2018.

Receivables portfolio at end-June stood at PLN1.43 billion versus
PLN1.75 billion at end-2017, PAP discloses.

In 2017, GetBack suffered PLN1.35 billion consolidated net loss
or PLN16.14 on negative revenues, PAP relays, citing the firm's
full-year 2017 report without an auditor's approval published in
July 2018.  Earlier, GetBack had variously estimated its 2017
group net loss at PLN1.0 billion, PLN1.2 billion and then PLN1.3
billion, according to PAP.

GetBack defaulted on bonds in late March/early April, PAP
recounts.  It eventually filed for bankruptcy protection and
repeatedly delayed release of its 2017 financial results, PAP
notes.

GetBack SA is a Polish debt collector.



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


ANTALYA: Fitch Maintains BB/BB+ IDRs on Rating Watch Negative
-------------------------------------------------------------
Fitch Ratings has maintained the Metropolitan Municipality of
Antalya's Long-Term Foreign-Currency Issuer Default Rating of
'BB' and Long-Term Local-Currency IDR of 'BB+' on Rating Watch
Negative. Its Short-Term Foreign Currency and Local Currency IDRs
have been affirmed at 'B'. Fitch has also maintained Antalya's
National Long-Term Rating of 'AA+(tur)' on RWN.

Fitch placed Antalya on RWN on August 20, 2018 after the Turkish
lira's sharp fall year to date threatened its large share (60%)
of unhedged foreign debt. This could adversely affect the city's
debt sustainability and therefore trigger Fitch's negative
sensitivity for a downgrade.

KEY RATING DRIVERS

Debt & Liquidity (Neutral/Negative): Fitch expects direct debt to
increase to about 100% of current revenue over the medium term
(2017: 65.2%), contrary to its previous expectations of 80%. This
is mainly due to the withdrawal of the first tranche of the IFC
loan amounting to EUR52.5 million to finance ongoing investment.
Large Turkish lira volatility is another challenging factor for
the metropolitan municipality in the medium term, given its large
FX exposure.

Accordingly, Fitch expects Antalya's direct debt to increase to
TRY1.4 billion at end-2018 (2017: TRY 802.6 million). Of that
increase, approximately 80% is expected to be due to new
borrowing and 20% due to depreciation of the Turkish lira against
the euro.

At end-2017, Antalya's FX liabilities accounted for 60.6% or TRY-
equivalent 486.7 million of city's total debt stock. Fitch
expects large currency volatility might increase debt servicing
costs of its unhedged FX liabilities and weaken debt servicing
capacity. However, the lengthy weighted average maturity of its
external debt at about seven years, its amortising structure and
predictable monthly cash flows would mitigate any immediate
refinancing risk.

Fiscal Performance (Neutral/Stable): Interim budgetary results
showed Antalya maintaining control on opex and capex for 1H18, by
realising opex at 35% of the budgeted amount, while collecting
46% of budgeted operating revenue, thereby producing an interim
operating margin at a high 40%.

Antalya capped capex at TRY750 million for FY18 or at about 40%
of the budgeted amount, which according to its expectation would
curtail deficit before financing at below 15% of total revenue,
and would thereby not lead to a further increase in debt funding.
Capital revenue realisation, however, was low and accounted for
5% of the budgeted amount, as the real estate tender due to large
market volatility could not be completed. Fitch believes Antalya
would not incur additional capex unless further asset sales are
generated.

In line with its expectation, 1H18 official statistics
demonstrate a continued upswing of nationwide annual tourist
arrivals of 29% yoy. Of the arrivals 42.9% was captured by
Antalya alone. Fitch expects this will provide further support
for local economic growth. As tax revenue is inflation-adjusted,
Fitch expects shared tax revenue to grow on average 18% yoy, in
line with its previous forecasts in April 2018.

Overall, Fitch expects Antalya's budget performance to stabilise,
if the city continues to exercise discipline on opex and capex.
This should lead to an improvement in operating margin to 30% on
average in 2018-2020 from 25% on average since its previous
forecast in April 2018.

Economy (Neutral/Stable): Fitch expects Antalya's economic growth
to be supported by the continued upswing in the tourism sector,
boosted by the Turkish lira's sharp fall since mid-August 2018.
Annual tourist arrivals for Antalya increased 24.6% almost to 9.5
million tourists (versus 10 year average: 9.36 million tourists)
at end-2017, after a sharp decrease of 21.7% to 5.9 million
tourists in 2016. As of end-1H18 annual tourist arrivals
increased 29% yoy.

On average, Antalya hosts 30% of the nation's tourist arrivals.
Antalya is Turkey's seventh-largest per capita GDP contributor
and fifth-largest city by population. However, the concentration
of its local economy on tourism and agriculture makes the city
less resilient to adverse shocks.

Management (Neutral/Stable): Antalya has a track record of
volatile budget performance, with opex growth mostly exceeding
operating revenue growth. The current administration's spending
restraint was compromised during the nationwide recession in
2016, although 1H18 budget results show a renewed commitment to
cost discipline.

Institutional Framework (Weakness/Stable): Antalya's credit
profile is constrained by a weak institutional framework for
Turkish subnationals. This reflects a short track record of a
stable relationship between the central and local governments on
allocation of revenue and responsibilities, a weak financial
equalisation system and evolving debt management in comparison
with their international peers.

RATING SENSITIVITIES

Fitch expects to resolve the RWN by the next scheduled CRA3
review. Further depreciation of the Turkish lira on average by
more than 25% against a basket of currencies will increase
Antalya's debt and debt servicing costs and negatively impact its
ability to cover its high capex needs. It will also probably
result in debt metrics that will not be commensurate with its
ratings.


KARELIA REPUBLIC: Fitch Withdraws B+ LT Issuer Default Ratings
--------------------------------------------------------------
Fitch Ratings has affirmed Russian Republic of Karelia's Long-
Term Foreign- and Local-Currency Issuer Default Ratings (IDRs) at
'B+' with Stable Outlooks and Short-Term Foreign-Currency IDR at
'B'. The republic's senior unsecured debt long-term rating has
been affirmed at 'B+'.

At the same time, the agency has withdrawn all of Karelia's
ratings for commercial reasons, and will no longer provide
ratings or analytical coverage for the issuer.

KEY RATING DRIVERS

Fiscal Performance Assessed as Weakness/Positive Trend
Karelia recorded a notable improvement in its operating
performance in 2017 and this trend continued in 1H18. During
January-July 2018 Karelia collected 58% of revenue budgeted for
the full year and incurred 48% of full-year expenditure,
resulting in a mid-year surplus of RUB4.3 billion. This was
driven by improved corporate income tax revenue, which exceeded
2017 proceeds.

Fitch's rating case scenario envisages an acceleration in
expenditure (particularly capital spending) by end-2018 and
forecasts a close to balanced budget for the full year, which is
a notable improvement from the average deficit of 6.6% of total
revenue in 2016-2017. Fitch expects operating margin to reach a
high 9.6%, but this likely to be one-off. Fitch's rating case
expects Karelia to consolidate its operating margin at 5%-6% in
the medium term, while deficit before debt variation remains
moderate at 2%-3%.

Karelia's fiscal performance improvement is underpinned by
moderate growth of tax revenue and higher transfers from the
federal government due to a new formula for grants' calculation,
while opex should remain under control. However, the current
balance will remain fragile, reflecting prolonged structural
imbalances of the region's budget.

Debt and Liquidity Assessed as Weakness/Stable Trend

Fitch projects Karelia's direct risk will remain close to 70% of
current revenue in the medium term, which is below the historical
average of 78%. The improvement will be driven by revenue
increase, while absolute debt will see a moderate rise. Direct
risk declined to RUB17.9 billion at end-August 2018 from RUB24.6
billion at end-2017, due to the interim fiscal surplus, but is
likely to increase back to RUB25 billion by year-end, according
to Fitch's rating case.

As with most Russian regions, Karelia participates in the budget
loan restructuring programme initiated by the federal government
at end-2017. Under the programme, the maturity of RUB11.2 billion
budget loans granted to the region has been extended until 2024,
easing refinancing pressure. At the same time Karelia had failed
to comply with financial covenants imposed by the Ministry of
Finance as a condition of the programme participation, and was
forced to repay RUB2.24 billion of restructured budget loans
ahead of schedule in 1H18.

Despite early redemption of part of its budget loans, the latter
still dominated Karelia's debt structure (51% of direct risk at
September 1, 2018), followed by three-year revolving bank loans
(35%), and six-year amortising domestic bonds (14%). The final
debt maturity profile is stretched to 2034, but the bulk of debt
maturities (96% of total) are concentrated in 2019-2024. This
leads to a weighted average life of debt of about four years,
which is short compared with international peers'.

Management and Administration Assessed as Neutral/Stable trend
As with most Russian local and regional governments (LRGs),
regional budgetary policy is strongly dependent on the decisions
of the federal authorities. The republic receives a steady flow
of earmarked transfers from the federal budget for capital and
current expenditures. The transfers composed about 40% of the
region's total revenue in 2017. Karelia's administration has a
socially-oriented fiscal policy and aims to fulfil all social
obligations. At the same time, management practices are bounded
by the financial covenants that were imposed by the Ministry of
Finance in exchange for low-cost budget loans.

Karelia focused on improving its fiscal performance by optimising
expenditure and eliminating fiscal deficit in the longer term.
The region aims to reach a balanced budget in 2018 and surplus in
2019-2020, which should lead to absolute debt reduction. However,
the region's forecasting ability is limited by an unstable
institutional framework.

Institutional Framework Assessed as Weakness/Stable trend

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

Economy Assessed as Neutral/Stable trend

Karelia's wealth metrics are close to the national median.
However, the economy is concentrated in certain industrial
sectors, which exposes the region to market price fluctuations
and potential changes in fiscal regulation. Fitch projects
Russia's economy will continue recovering and grow 2% in 2018 and
1.5% in 2019 (2017: 1.5%), with the republic likely to follow
this trend.

RATING SENSITIVITIES

Not applicable.



===========
S W E D E N
===========


INVUO TECHNOLOGIES: Files Bankruptcy Application
------------------------------------------------
Gaurika Juneja at Reuters reports that Invuo Technologies AB said
it decided to file an application for bankruptcy on Oct. 8.

According to Reuters, the company said the bankruptcy filing
includes its Swedish subsidiary Invuo Services AB, but other
group companies are not included in the filing.

Headquartered in Stockholm, Sweden, Invuo Technologies AB
operates as a software company specializing in technology
solutions for mobile payments.  The Company provides mobile
service platform for mobile and digital payments.  Invuo
Technologies serves financial industry, mobile operators, and
retailers worldwide.



===========
T U R K E Y
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ISTANBUL TAKAS: Fitch Cuts Viability Rating to b+, Outlook Neg.
---------------------------------------------------------------
Fitch Ratings has downgraded Istanbul Takas ve Saklama Bankasi
A.S.'s (Takasbank) Viability Rating (VR) to 'b+' from 'bb-' and
affirmed the bank's Long-Term Foreign-Currency (LTFC) Issuer
Default Rating (IDR) at 'BB' with a Negative Outlook.

The rating action follows the downgrade of 20 Turkish banks on
October 1.

KEY RATING DRIVERS

VR

The downgrade of Takasbank's VR primarily reflects Fitch's view
that Takasbank's credit risk exposure, notably in its treasury
activities, has increased following the downgrade of its largest
treasury counterparties. Following October 1 rating action, the
majority of Takasbank's treasury counterparties is now rated in
the 'B' rating category, which negatively affects its assessment
of its risk appetite and asset quality.

In addition, the more challenging operating environment,
including ongoing currency and interest rate volatility, will
likely pressurise Takasbank's overall financial profile via its
main commercial bank counterparties, notably its asset quality
and capitalisation.

Takasbank's VR, which is at the same level as the VRs of most
large commercial Turkish banks, remains underpinned by its
dominant franchise as the country's only clearing house as well
as its sound counterparty risk management, relatively limited
direct credit risk in its central clearing counterparty (CCP)
activities (due to the availability of adequate default
management resources), acceptable capitalisation, funding and
liquidity profile. The VR also reflects considerable
concentration risk in its CCP activities and incremental credit
risk appetite in its non-CCP activities, notably its extensive
treasury activities with Turkish counterparties.

At end-1H18, Takasbank's Tier 1 ratio was close to 15%, broadly
in line with end-2017 but materially lower than end-2016 (around
22%), largely due to a material increase in risk weights for
domestic money market exposures. Profitability remained sound,
reflected in an operating profit/average equity ratio of close to
35%, primarily driven by higher treasury revenue, and to a lesser
extent, increasing CCP revenue.

Takasbank is Turkey's only CCP institution and is majority-owned
by Borsa Istanbul, Turkey's main stock exchange. Borsa Istanbul
in turn is majority-owned by the Turkish government (via the
Turkish Wealth Fund). Takasbank is operating under a limited
banking licence, and is regulated by three Turkish regulatory
bodies: the Central Bank of Turkey, the Banking Regulation and
Supervision Agency and the Capital Markets Board.

IDRs, SUPPORT RATING, SRF AND NATIONAL RATING

Takasbank's Support Rating Floor (SRF), which underpins its LTFC
IDR, is aligned with the sovereign's LTFC IDR. The bank's Long-
Term Local-Currency IDR of 'BB+' is also aligned with that of the
sovereign, reflecting its high support expectations and Turkey's
ability to provide support in local currency.

Takasbank's Support Rating of '3' and SRF of 'BB' reflect its
view of a moderate probability of support from the Turkish
sovereign in case of need. In its opinion, Takasbank has
exceptionally high systemic importance for the Turkish financial
sector and contagion risk from its default would be considerable
given its inter-connectedness.

The state's ability to provide extraordinary FC support to the
banking sector, if required, may be constrained by limited
central bank reserves (net of placements from banks) and the
banking sector's sizable external debt. However, in its view,
Takasbank's FC support needs, even in quite extreme scenarios
should be manageable for the sovereign given Takasbank's business
model, short-term and largely matched balance sheet as well as
its acceptable liquidity position.

The affirmation of Takasbank's National Rating reflects Fitch's
view of unlikely material weakening in the ability or propensity
of the authorities to support the bank in local currency,
resulting in unchanged creditworthiness relative to other
domestic issuers.

RATING SENSITIVITIES

VR

Takasbank's VR is primarily sensitive to further deterioration in
the credit quality of its counterparties or a further worsening
of the domestic operating environment. In addition, Takasbank's
VR remains sensitive to a material operational loss, or a
materially increased risk appetite, for example, by growing
rapidly in untested asset classes. Increasing risk appetite in
the bank's treasury activities could also be rating negative.

IDRs, SUPPORT RATING, SRF AND NATIONAL RATING

Rating action on Turkey's sovereign rating are likely to be
mirrored in Takasbank's ratings given the strong correlation of
the bank's credit profile with sovereign, country and banking
sector risks. Additionally, an indication that resources, in
particular in FC, required to support Takasbank in a stress
scenario are materially larger than currently estimated by Fitch,
for instance as a result of a higher risk appetite in FC treasury
activities, could put pressure on Takasbank's SRF and its LTFC
IDR.

The rating actions are as follows:

Takasbank

Long-Term Foreign-Currency IDR: affirmed at 'BB'; Outlook
Negative

Short-Term Foreign-Currency IDR: affirmed at 'B'

Long-Term Local-Currency IDR: affirmed at 'BB+'; Outlook Negative

Short-Term Local-Currency IDR: affirmed at 'B'

Viability Rating: downgraded to 'b+' from 'bb-'

Support Rating: affirmed at '3'

Support Rating Floor: affirmed at 'BB'

National Long-Term Rating: affirmed at 'AAA(tur)'; Outlook Stable


PALET CONSTRUCTION: Files for Bankruptcy Protection
---------------------------------------------------
Zulfikar Dogan at Ahval reports that four Turkish construction
giants with decades of history have filed for bankruptcy
protection.

According to Ahval, these were Palet Construction, a firm founded
52 years ago, Ceylan and Nuhoglu, each more than 30 years in the
business, and Nafia.

Ninety percent of Palet's tenders are for public projects, worth
a combined total of TRY660 million (US$107 million), Ahval
discloses.

Ali Babacan, the ruling Justice and Development Party (AKP)'s
longest-serving deputy prime minister for economic and financial
affairs, gave the plainest description of the problematic period
faced by the construction sector in a searing piece of
self-criticism in 2014, before leaving the party, Ahval relates.

"Without producing anything ourselves, without earning it, we are
using credit secured from abroad for luxury construction
projects, shopping malls, luxury accommodation . . . before long
this is going to land Turkey in trouble," Ahval quotes
Mr. Babacan as saying.

In fact, the gurus behind Turkish President Recep Tayyip Erdogan
and the AKP governments' economic model based on construction,
tenders and rent-seeking were found at none other than McKinsey,
the U.S. consultancy firm employed amid much criticism last week
to oversee Turkey's economy, Ahval states.

The construction sector was the backbone of McKinsey's strategy,
which recommended a rapid increase of funds for construction,
infrastructure and particularly the housing market, the creation
of a market for long-term mortgages and the establishment of an
independent national body to regulate them, Ahval relates.

The large incentives offered by the government to construction
firms that won tenders for public works under these models means
the Treasury is obliged to pay US$35.5 billion to these firms
over the next 20 to 30 years, according to Ahval.

The fact that construction giants are now queuing up to file for
bankruptcy protection is the clearest sign that the McKinsey
model held to since 2003 has collapsed, Ahval notes.


TEB FINANSMAN: Fitch Lowers LT IDR to BB-, Outlook Negative
-----------------------------------------------------------
Fitch Ratings has downgraded TEB Finansman A.S.'s Long-Term
Issuer Default Rating (LT IDR) to 'BB-' from 'BB' and National
Rating to 'AA(tur)' from 'AAA(tur)'. The Outlook on the IDR is
Negative and the Outlook on the National Rating is Stable.

The rating actions reflect an update to Fitch's view of the
propensity of BNP Paribas S.A. (BNPP, A+/Stable) to provide
support to the subsidiary in case of need amid increased risk of
government intervention in the banking sector, and follow the
downgrade of Turk Ekonomi Bankasi A.S. (TEB Bank;BB-/Negative),
TEB Cetelem's sister bank, on October 1, 2018.

KEY RATING DRIVERS

IDRS AND NATIONAL RATINGS

TEB Cetelem's IDRs and National Rating are driven by potential
support from its ultimate parent, BNPP. Fitch's view of support
is based on TEB Cetelem being a relatively small, integrated
subsidiary of the wider BNPP franchise. In its view, the
propensity of support for TEB Cetelem and its sister bank, TEB
Bank, are closely aligned. This is based on a common brand
association and an equally significant reputational damage
arising in the event of a potential subsidiary default,
notwithstanding differences in their respective legal structures.
The Negative Outlook on TEB Cetelem's Long-Term IDRs is aligned
with that on its affiliate, TEB Bank, and the wider Turkish
banking sector. Fitch does not expect changes to the company's
creditworthiness relative to other Turkish issuers, therefore the
Outlook on the National Rating is Stable.

TEB Cetelem is an automotive finance company operating in Turkey,
with its franchise strength anchored on established relationships
with reputable international original equipment manufacturers (in
both the middle and premium class segment). Integration into the
BNP Group manifests by a shared brand image as well as the
leveraging of key operational functions of its parent, such as
risk management and corporate governance.

TEB Cetelem's ultimate parent, BNPP is a well-established global
banking group. BNPP's IDRs are underpinned by a sound standalone
credit profile, which is characterised by a stable and
diversified business model, strong franchise value and resilient
earnings generation, even in challenging operating environments.
Turkey is a strategically important market for the BNPP, where it
is also represented by TEB Bank.

RATING SENSITIVITIES

IDRS AND NATIONAL RATINGS

TEB Cetelem's IDRs are sensitive to a change in the sovereign
ratings for Turkey (BB/Negative) and the associated potential
impact thereof on the wider Turkish financial sector.

TEB Cetelem's IDRs are also sensitive to changes in Fitch's view
of the propensity of BNPP to provide support to its Turkish
subsidiaries in case of need.

The rating actions are as follows:

Long-Term Foreign-Currency IDR downgraded to 'BB-' from 'BB';
Outlook Negative

Short-Term Foreign-Currency IDR affirmed at 'B'

Long-Term Local-Currency IDR downgraded to 'BB' from 'BB+';
Outlook Negative

Short-Term Local-Currency IDR affirmed at 'B'

Support Rating affirmed at '3'

National Long-Term Rating downgraded to 'AA(tur)' from
'AAA(tur) '; Outlook Stable



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


RMAC NO. 2: Moody's Assigns (P)Ca Rating to Class X Notes
---------------------------------------------------------
Moody's Investors Service has assigned provisional long-term
credit ratings to Notes to be issued by RMAC No. 2 PLC:

GBP[-]M Class A Mortgage Backed Floating Rate Notes due June
2046, Assigned (P)Aaa (sf)

GBP[-]M Class B Mortgage Backed Capped Rate Notes due June 2046,
Assigned (P)Aa3 (sf)

GBP[-]M Class C Mortgage Backed Capped Rate Notes due June 2046,
Assigned (P)A3 (sf)

GBP[-]M Class D Mortgage Backed Capped Rate Notes due June 2046,
Assigned (P)Baa3 (sf)

GBP[-]M Class X Mortgage Backed Capped Rate Notes due June 2046,
Assigned (P)Ca (sf)

Moody's has not assigned ratings to the GBP[-]M Class Z1 and Z2
Mortgage Backed Notes due June 2046.

The portfolio backing this transaction consists of UK non-
conforming residential loans originated by GMAC-RFC Limited
(currently known as Paratus AMC Limited ("Paratus")) and Amber
Homeloans Limited (not rated). [97.0]% of the pool was previously
securitised in 12 RMAC securitisations. The portfolio securitised
in RMAC No.1 PLC, which closed in April 2018, was randomly
selected from the total portfolio of the 12 legacy RMAC
transactions. The portfolio securitised in RMAC No.2 PLC is what
remains outstanding of the total portfolio.

RATINGS RATIONALE

The ratings take into account the credit quality of the
underlying mortgage loan pool, from which Moody's determined the
MILAN Credit Enhancement (CE) and the portfolio expected loss, as
well as the transaction structure and legal considerations. The
expected portfolio loss of [3.0]% and the MILAN CE of [15.0]%
serve as input parameters for Moody's cash flow model, which is
based on a probabilistic lognormal distribution.

The portfolio expected loss is [3.0]%, which is lower than other
recent UK non-conforming transactions and takes into account: (i)
the historical performance of the collateral backing the RMAC
transactions; (ii) the number of loans in arrears at closing,
[23.3]% of the pool is in arrears at the end of August 2018, of
which [6.7]% is less than 30 days in arrears and [9.9]% is more
than 90 days in arrears; (iii) the weighted-average current LTV
of [69.4]% and the weighted-average indexed LTV of [48.2]%; (iv)
the proportion of interest-only loans, [78.0]% of the pool, of
which [2.3]% are part and part loans; (v) the current
macroeconomic environment and its view of the future
macroeconomic environment in the UK; and (vi) benchmarking with
similar transactions in the UK non-conforming sector.

The MILAN CE for this pool is [15.0%], which is lower than other
recent UK non-conforming transactions and takes into account: (i)
the weighted-average current LTV of [69.4]% and weighted-average
indexed LTV of [48.2]% which are lower compared to the average of
the UK non-conforming sector; (ii) the presence of [77.4]% of the
loans where the borrower income is either self-certified or was
not verified; (iii) the presence of [42.2]% of loans in the pool
that were modified at some point in the past as a result of loss
mitigation techniques used by Paratus; (iv) the weighted average
seasoning of the pool of [13.8] years; and (v) the level of
arrears around [23.3]% at the end of August 2018, of which [6.7]%
is less than 30 days in arrears and [9.9]% is more than 90 days
in arrears.

A non-amortising reserve fund will be funded at closing and will
be equal to [1.5]% of the Class A, B, C, D and Z1 Notes at
closing. It will consist of two components, the first is a
liquidity component, which will be funded at closing and is sized
at [1.63]% of Class A and B Note balance at closing. The
liquidity component of the reserve fund will amortise to the
lesser of [1.63]% of Class A and B Note balance at closing and
[2.0]% of the currently outstanding balance of Class A and B
Notes during the life of the transaction. The liquidity component
of the reserve will be available to cover senior fees and
interest on Class A and B (subject to no PDL on the Class B). The
liquidity component of the reserve will be replenished in the
revenue waterfall below the Class B interest payments.

The second component of the reserve fund is sized at [1.5]% of
the Class A, B, C, D and Z1 Notes at closing minus the balance of
the liquidity reserve component from time to time. This means
that at closing the credit component of the reserve fund will be
residual and increase throughout the life of the transaction as
the liquidity component amortises. The general component of the
reserve fund is available upon conditions to cover both credit
and interest and senior fee shortfalls.

Operational Risk Analysis: Paratus AMC Limited will be acting as
servicer and is not rated by Moody's. In order to mitigate the
operational risk, the transaction will have a back-up servicer
facilitator (Intertrust Management Limited (not rated)). Elavon
Financial Services DAC (Aa2/P-1), acting through its UK Branch
will be acting as an independent cash manager from closing. To
ensure payment continuity over the transaction's lifetime, the
transaction documents incorporate estimation language whereby the
cash manager can use the three most recent servicer reports to
determine the cash allocation in case no servicer report is
available. Class A Notes benefit from principal to pay interest,
and the liquidity component of the reserve fund. The liquidity
component of the reserve provides the Class A Notes with the
equivalent of [2] quarters of liquidity.

Interest Rate Risk Analysis: The transaction is unhedged with
[45.8]% of the pool balance linked to Bank of England Base Rate
(BBR), [47.5]% linked to three-month LIBOR and [6.7]% SVR-linked
loans. Moody's has taken the absence of basis swap into account
in its cashflow modelling.

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

Principal Methodology

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

The analysis undertaken by Moody's at the initial assignment of
ratings for RMBS securities may focus on aspects that become less
relevant or typically remain unchanged during the surveillance
stage. Please see "Moody's Approach to Rating RMBS Using the
MILAN Framework" for further information on Moody's analysis at
the initial rating assignment and the on-going surveillance in
RMBS.

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

Significantly different loss assumptions compared with its
expectations at close due to either a change in economic
conditions from its central scenario forecast or idiosyncratic
performance factors would lead to rating actions. For instance,
should economic conditions be worse than forecast, the higher
defaults and loss severities resulting from a greater
unemployment, worsening household affordability and a weaker
housing market could result in a downgrade of the ratings.
Downward pressure on the ratings could also stem from: (i)
deterioration in the Notes' available credit enhancement; (ii)
counterparty risk, based on a weakening of a counterparty's
credit profile; or (iii) any unforeseen legal or regulatory
changes. Conversely, the ratings could be upgraded: (i) if
economic conditions are significantly better than forecasted;
(ii) upon deleveraging of the capital structure, or (iii) a
better than expected performance could also lead to an upgrade.


RMAC NO. 2: S&P Assigns Prelim. CCC Rating to Class X Notes
-----------------------------------------------------------
S&P Global Ratings assigned preliminary credit ratings to RMAC
No. 2 PLC's class A, B, C-Dfrd, D-Dfrd, and X notes. At closing,
RMAC No. 2 will also issue unrated class Z1 and Z2 notes and
unrated certificates.

The majority of the provisional mortgage pool was previously
securitized in earlier RMAC transactions issued between 2003 and
2005, namely RMAC 2003-NS1 PLC, RMAC 2003-NS2 PLC, RMAC 2003-NS3
PLC, 2003-NS4 PLC, RMAC 2004-NS1 PLC, RMAC 2004-NSP2 PLC, RMAC
2004-NS3 PLC, RMAC 2004-NSP4 PLC, RMAC 2005-NS1 PLC, RMAC 2005-
NSP2 PLC, RMAC 2005-NS3 PLC, and RMAC 2005-NS4 PLC, all of which
were called and redeemed on March 12, 2018. All of the loans in
these transactions will be securitized in RMAC No. 1 and RMAC No.
2 with no negative or positive selection. The loans included in
RMAC No. 1 PLC, which closed in April 2018, were randomly
selected from the total portfolio.

The provisional pool comprises first-lien U.K. owner-occupied and
buy-to-let residential mortgage loans made to nonconforming
borrowers. These borrowers may have previously been subject to a
county court judgment (or the Scottish equivalent), an individual
voluntary arrangement, a bankruptcy order, have self-certified
their incomes, or were otherwise considered by banks and building
societies to be nonprime borrowers. The loans are secured on
properties in England, Wales, Scotland, and Northern Ireland and
were mostly originated between 2003 and 2005 (91.2%). Paratus AMC
(formerly known as GMAC-RFC Ltd.) originated 99.5% of the pool,
and Amber Homeloans Ltd. 0.5%.

S&P said, "Our preliminary ratings on the class A, B, and X notes
address the timely payment of interest and ultimate payment of
principal. Our preliminary ratings on the class C-Dfrd and D-Dfrd
notes address ultimate payment of principal and interest while
they are not the most senior class outstanding. When the class C-
Dfrd and D-Dfrd notes become the most senior note outstanding,
our ratings will address the timely payment of interest and
ultimate payment of principal. Under the transaction documents,
the issuer can defer interest payments on these notes, with
interest accruing on deferred payments until they become the most
senior class outstanding, whereby any accrued unpaid interest is
due on the interest payment date when the class becomes the most
senior, and future interest payments become due on a timely
basis. Although the terms and conditions of the class X notes
allow for the deferral of interest, interest does not accrue on
deferred payments. Hence, our preliminary ratings on the class X
notes address the timely payment of interest and ultimate payment
of principal.

"Our preliminary ratings reflect our assessment of the
transaction's payment structure, cash flow mechanics, and the
results of our cash flow analysis to assess whether the notes
would be repaid under stress test scenarios. Subordination and
the reserve fund provide credit enhancement to the notes that are
senior to the rated class X notes and unrated class Z1 and Z2
notes. Taking these factors into account, we consider the
available credit enhancement for the rated notes to be
commensurate with the preliminary ratings that we have assigned."

Due to structural features, payment of timely interest on the
class X notes is reliant upon excess spread following
replenishment of the reserve fund. Within the pool, 16.3% of
loans are currently at least one month in arrears, with 9.2%
having been delinquent for 90 days or more. S&P said, "We view
these borrowers as having a higher risk of default and once
related losses are realized, it's likely that excess spread will
be used to cover the junior principal deficiency ledger, causing
deferral of the class X notes' interest. In our view, given the
current level of arrears, payment of timely interest on the class
X notes is dependent upon favorable business, financial, and
economic conditions. We have therefore assigned our 'CCC (sf)'
rating to this class of notes, in line with our "Criteria For
Assigning 'CCC+', 'CCC', 'CCC-', And 'CC' Ratings," published on
Oct. 1, 2012."

  PRELIMINARY RATINGS ASSIGNED

  RMAC No. 2 PLC

  Class         Rating       Amount (mil. EUR)
  A             AAA (sf)                 TBD
  B             AA (sf)                  TBD
  C-Dfrd        A+ (sf)                  TBD
  D-Dfrd        BBB+ (sf)                TBD
  X             CCC (sf)                 TBD
  Z1            NR                       TBD
  Z2            NR                       TBD

  TBD--To be determined.
  NR--Not rated.



                            *********

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,
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Each Tuesday edition of the TCR contains a list of companies with
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Each Friday's edition of the TCR includes a review about a book
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                            *********


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

Troubled Company Reporter-Europe is a daily newsletter co-
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