/raid1/www/Hosts/bankrupt/TCREUR_Public/181121.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

         Wednesday, November 21, 2018, Vol. 19, No. 231


                            Headlines


G E R M A N Y

A-BEST 16: S&P Assigns Prelim BB (sf) Rating to Class E Notes


G R E E C E

GREECE: Central Bank Proposes Plan to Help Banks Cut Bad Debts


I R E L A N D

ALLEGRO CLO II: Moody's Affirms B3 Rating on Class E Notes
BAIN CAPITAL 2018-2: Moody's Assigns B2 Rating to Class F Notes
BAIN CAPITAL 2018-2: Fitch Assigns B-sf Rating to Class F Certs.
SETANTA INSURANCE: High Court Approves EUR20MM+ Payouts


I T A L Y

ITALY: Wants to Avoid European Sanctions Over 2019 Budget


L U X E M B O U R G

ORION ENGINEERED: Moody's Hikes CFR to Ba2, Outlook Stable


N O R W A Y

NORWEGIAN AIR 2016-1: Fitch Cuts Class B Certs. Rating to B


S P A I N

BBVA LEASING 1: Fitch Raises Class B Notes Rating from 'BB+sf'


S W I T Z E R L A N D

EUROCHEM GROUP: S&P Alters Outlook to Pos. & Affirms 'BB-' ICR
LAFARGEHOLCIM HELVETIA: S&P Rates New Hybrid Securities 'BB+'


T U R K E Y

EKSPO FAKTORING: Moody's Withdraws B3 CFR for Business Reasons


U K R A I N E

UKRAINE: Sale of Insolvent Banks' UAH5.8-Bil. Asset Pool Fails


U N I T E D   K I N G D O M

DRL HOLDINGS: S&P Assigns Preliminary B- Issuer Credit Rating
FINSBURY SQUARE 2018-2: Moody's Rates Class X Notes Caa2 (sf)
FINSBURY SQUARE 2018-2: Fitch Assigns CCCsf Rating to Cl. E Debt
JAGUAR LAND ROVER: Fitch Lowers LT IDR to BB, Outlook Negative
JOHNSTON PRESS: Operations to Continue as Normal Following Buyout

LERNEN BONDCO: Moody's Assigns B3 CFR, Outlook Stable
NEATH RFC: Loses "Number of Players" Due to Winding-Up Petition


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G E R M A N Y
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A-BEST 16: S&P Assigns Prelim BB (sf) Rating to Class E Notes
-------------------------------------------------------------
S&P Global Ratings assigned its preliminary credit ratings to
Asset-Backed European Securitisation Transaction Sixteen UG
(haftungsbeschrankt)'s (A-BEST 16) class A, B, C, D, and E euro-
denominated asset-backed floating-rate notes. At closing, A-BEST
16 will also issue unrated class M fixed-rate notes.

A-BEST 16 will be FCA Bank's 16th publicly rated transaction. The
transaction will securitize a portfolio of German auto loan
receivables. FCA Bank Deutschland granted the loan contracts to
its German commercial and private customers.

RATING RATIONALE

Sector Outlook

S&P said, "In our base-case scenario, we forecast that Germany
will record GDP growth of 2.0% in 2018, 1.7% in 2019, 1.5% in
2020, and 1.3% in 2021, compared with 2.5% in 2017. At the same
time, we expect unemployment rates to decrease even further,
reaching record lows. We forecast unemployment to be 3.3% in
2018, 3.0% in 2019, 2.8% in 2020, and 2.6% in 2021, compared with
3.8% in 2017. In our view, changes in GDP growth and the
unemployment rate largely determine portfolio performance. We set
our credit assumptions to reflect our economic outlook. Our near-
to medium-term view is that the German economy will remain
resilient and record positive growth."

Operational Risk

FCA Bank Deutschland is an experienced originator in the German
auto loan market. S&P said, "Our preliminary ratings on the class
A, B, C, D, and E notes reflect our opinion of FCA Bank
Deutschland's well-established underwriting policies, as well as
our evaluation of its ability to fulfil its role as servicer
under the transaction documents. We have reviewed the quality of
the originator's underwriting and servicing policies."

S&P said, "We have applied our operational risk criteria in our
analysis. The collateral in this pool comprises prime auto loans.
Under our operational risk criteria, auto loans are considered as
having low severity and portability risks. As such, these
criteria do not impose any cap on the maximum achievable rating
due to operational risks."

Credit Risk

S&P said, "We have used performance data from FCA Bank
Deutschland's loan portfolio and from benchmark transactions
(with similar portfolio characteristics) to analyze credit risk.
We expect to see about 3.95% of defaults in the securitized pool.
As for comparable transactions, we have sized our base-case
defaults expectation based on five subpools: amortizing loans and
balloon loans for new cars and used cars, and formula loans (new
and used cars combined). Furthermore, we have sized for market
value decline risk as some of the loans contain a balloon
payment. We also sized stressed recoveries of 35% for all rating
levels based on recovery data from FCA Bank Deutschland's loan
book and previous transactions. We have analyzed credit risk by
applying our European auto asset-backed securities (ABS)
criteria."

Counterparty Risk

S&P said, "Our preliminary ratings on the rated notes also
reflects the replacement mechanisms implemented in the
transaction documents, which adequately mitigate the
transaction's exposure to counterparty risk. The transaction is
exposed to counterparty risk through BNP Paribas Securities
Services (Frankfurt Branch) as bank account provider, and Credit
Agricole Corporate and Investment Bank as the class A, B, C, D,
and E notes stand-by interest rate swap counterparty. Under the
interest rate swap set-up, FCA Bank Deutschland is the front swap
counterparty and Credit Agricole Corporate and Investment Bank is
the stand-by swap provider. In our analysis of the interest rate
swap, we only rely on our rating on, and commitment of, Credit
Agricole Corporate and Investment Bank. We analyzed counterparty
risk by applying our current counterparty criteria. We anticipate
that the final swap agreements will be in line with our current
counterparty criteria."

Legal Risk

S&P said, "In our opinion, the transaction may be exposed to
commingling risk if the servicer becomes insolvent. The
transaction's commingling reserve fund partially mitigates the
commingling risk. We have considered the transaction's exposure
to commingling risk in our cash flow analysis and sized for the
uncovered exposure. We have analyzed legal risk, including the
special purpose entity's bankruptcy remoteness, under our legal
criteria. We anticipate that the legal opinion at closing will
likely provide comfort that the sale of the assets would survive
the seller's insolvency."

Cash Flow Analysis

S&P said, "Our preliminary ratings on the class A, B, C, D, and E
notes reflect our assessment of the transaction's payment
structure as set out in the transaction documents. The credit
enhancement would build up quickly under our base-case scenario
due to the sequential payment structure. Our analysis indicates
that the available credit enhancement for the class A, B, C, D,
and E notes is sufficient to withstand the credit and cash flow
stresses that we apply at assigned preliminary ratings."

Ratings Stability

S&P said, "In our review, we have analyzed the effect of a
moderate stress on the credit variables and their ultimate effect
on the ratings on the notes. We have run two scenarios and the
results are in line with our credit stability criteria."

  PRELIMINARY RATINGS ASSIGNED

  Asset-Backed European Securitisation Transaction Eleven UG
  (haftungsbeschrankt)

  Class              Rating      Amount (mil. EUR)
  A                  AAA (sf)              540.0
  B                  AA (sf)                18.0
  C                  A (sf)                 20.0
  D                  BBB (sf)               16.0
  E                  BB (sf)                11.0
  M                  NR                     26.6

  NR--Not rated.


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G R E E C E
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GREECE: Central Bank Proposes Plan to Help Banks Cut Bad Debts
--------------------------------------------------------------
Nikos Chrysoloras, Christos Ziotis and Sotiris Nikas at Bloomberg
News report that Greece's central bank is working on a plan to
help banks cut their bad debts in half, the latest effort to
restore trust in the country's financial system, two people with
knowledge of the matter said.

According to Bloomberg, the people said that under the proposal,
Greek lenders would transfer about half of their deferred tax
claims to a special purpose vehicle, which would then sell bonds
and use the proceeds to buy some EUR42 billion (US$47 billion) of
bad loans from the lenders.

"We urgently need something like a bad bank, an asset management
company," Bloomberg quotes Bank of Greece Governor Yannis
Stournaras as saying at an event in Geneva.  "We're trying now,
we're developing a plan in the Bank of Greece to use the deferred
tax credit or claims of banks vis-a-vis the state.  And we do
that because this has been state aid that has already been
approved."

The Greek lenders' tax claims currently account for most of their
capital, Bloomberg notes.  As claims against the state, they were
granted to offset losses suffered during the country's debt
restructuring, Bloomberg states.

The Bank of Greece's plan differs from a proposal by the Hellenic
Financial Stability Fund earlier this year, which envisaged
creating a vehicle partly funded by hard cash chipped in by the
state, Bloomberg says.

The Bank of Greece plan has been submitted to the European
Central Bank's Single Supervisory Mechanism and the Greek finance
ministry, while any use of public guarantees is subject to
approval by European Commission competition authorities,
Bloomberg relates.  One of the people, as cited by Bloomberg,
said that European regulators could approve both the Bank of
Greece's plan and that from the HFSF, giving lenders more tools
to clean up their balance sheets.


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ALLEGRO CLO II: Moody's Affirms B3 Rating on Class E Notes
----------------------------------------------------------
Moody's Investors Service has placed on review for possible
downgrade the ratings of three classes of notes issued by Allegro
CLO II-S, Ltd. This action is driven by a correction to a Moody's
model input error for this transaction:

U.S.$44,400,000 Class A-2 Senior Secured Floating Rate Notes due
2028, Aa2 (sf) Placed Under Review for Possible Downgrade;
previously on Sep 17, 2018 Assigned Aa2 (sf)

U.S.$19,600,000 Class B Mezzanine Secured Deferrable Floating
Rate Notes due 2028, A2 (sf) Placed Under Review for Possible
Downgrade; previously on Sep 17, 2018 Assigned A2 (sf)

U.S.$26,000,000 Class C Mezzanine Secured Deferrable Floating
Rate Notes due 2028, Baa3 (sf) Placed Under Review for Possible
Downgrade; previously on Sep 17, 2018 Assigned Baa3 (sf)

Moody's has also affirmed the ratings on the following notes:

U.S.$1,600,000 Class X Senior Secured Floating Rate Notes due
2028, Affirmed Aaa (sf); previously on Sep 17, 2018 Assigned Aaa
(sf)

U.S.$256,000,000 Class A-1 Senior Secured Floating Rate Notes due
2028, Affirmed Aaa (sf); previously on Sep 17, 2018 Assigned Aaa
(sf)

U.S.$22,000,000 Class D Mezzanine Secured Deferrable Floating
Rate Notes due 2028, Affirmed Ba3 (sf); previously on Sep 17,
2018 Assigned Ba3 (sf)

U.S.$5,500,000 Class E Junior Secured Deferrable Floating Rate
Notes due 2028, Affirmed B3 (sf); previously on Sep 17, 2018
Assigned B3 (sf)

Allegro CLO II-S, Ltd., issued in September 2018, is a
collateralised loan obligation (CLO) backed by a portfolio of
broadly syndicated senior secured corporate loans. The portfolio
is managed by AXA Investment Managers, Inc. The transaction's
reinvestment period ends in October 2020.

RATINGS RATIONALE

The action reflects a correction to a Moody's model input error,
and the potential for an upcoming change to the transaction
documents in relation to such error. The rating model used by
Moody's in the September 17, 2018 rating action mistakenly used a
weighted average recovery rate (WARR) of 48.5%, which impacted
the modeling of the asset quality matrix and the modifiers. After
entering the correct WARR assumption of 43.0%, the model
indicates a higher expected loss for certain classes of notes.
The rating action reflects this change, and Moody's understanding
is that transaction parties initiated the process of amending the
transaction documentation that would change the asset quality
matrix and modifiers to maintain the current rating of the notes
placed on review for possible downgrade.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. In its base
case, Moody's analysed the underlying collateral pool as having a
performing par of USD 400 million and no principal proceeds
balance and defaulted par, a weighted average default probability
of 29.44% (consistent with a WARF of 3166 over a weighted average
life of 7.1 years), a weighted average recovery rate upon default
of 48.50% for a Aaa liability target rating, a diversity score of
63 and a weighted average spread of 3.40%.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool. In each case, historical and market
performance and a collateral manager's latitude to trade
collateral are also relevant factors. Moody's incorporates these
default and recovery characteristics of the collateral pool into
its cash flow model analysis, subjecting them to stresses as a
function of the target rating of each CLO liability it is
analysing.

Methodology Underlying the Rating Action:

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

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

This transaction is subject to a high level of macroeconomic
uncertainty, which could negatively affect the ratings on the
notes, in light of uncertainty about credit conditions in the
general economy. CLO notes' performance may also be impacted
either positively or negatively by 1) the manager's investment
strategy and behaviour and 2) divergence in the legal
interpretation of CDO documentation by different transactional
parties because of embedded ambiguities.

In addition to the quantitative factors that Moody's explicitly
modelled, qualitative factors are part of the rating committee's
considerations. These qualitative factors include the structural
protections in the transaction, its recent performance given the
market environment, the legal environment, specific documentation
features, the collateral manager's track record and the potential
for selection bias in the portfolio. All information available to
rating committees, including macroeconomic forecasts, input from
other Moody's analytical groups, market factors, and judgments
regarding the nature and severity of credit stress on the
transactions, can influence the final rating decision.


BAIN CAPITAL 2018-2: Moody's Assigns B2 Rating to Class F Notes
---------------------------------------------------------------
Moody's Investors Service, announced that it has assigned the
following definitive ratings to notes issued by Bain Capital Euro
CLO 2018-2 Designated Activity Company:

EUR 232,500,000 Class A Senior Secured Floating Rate Notes due
2032, Definitive Rating Assigned Aaa (sf)

EUR 13,800,000 Class B-1 Senior Secured Floating Rate Notes due
2032, Definitive Rating Assigned Aa2 (sf)

EUR 20,000,000 Class B-2 Senior Secured Fixed Rate Notes due
2032, Definitive Rating Assigned Aa2 (sf)

EUR 29,100,000 Class C Senior Secured Deferrable Floating Rate
Notes due 2032, Definitive Rating Assigned A2 (sf)

EUR 18,900,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2032, Definitive Rating Assigned Baa2 (sf)

EUR 22,900,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2032, Definitive Rating Assigned Ba2 (sf)

EUR 11,600,000 Class F Senior Secured Deferrable Floating Rate
Notes due 2032, Definitive Rating Assigned B2 (sf)

RATINGS RATIONALE

Moody's rating of the rated notes addresses the expected loss
posed to noteholders by the legal final maturity of the notes in
2032. The ratings reflect the risks due to defaults on the
underlying portfolio of loans given the characteristics and
eligibility criteria of the constituent assets, the relevant
portfolio tests and covenants as well as the transaction's
capital and legal structure. Furthermore, Moody's is of the
opinion that the collateral manager, Bain Capital Credit U.S. CLO
Manager, LLC, has sufficient experience and operational capacity
and is capable of managing this CLO.

Bain Capital Euro CLO 2018-2 Designated Activity Company is a
managed cash flow CLO. At least 90% of the portfolio must consist
of senior secured loans and senior secured bonds and up to 10% of
the portfolio may consist of unsecured obligations, second-lien
loans, mezzanine loans and high yield bonds. The portfolio is
expected to be approximately at least 90% ramped up as of the
closing date and to be comprised predominantly of corporate loans
to obligors domiciled in Western Europe.

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

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR 37.0 million of subordinated notes, which
will not be rated.

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

Methodology Underlying the Rating Action:

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

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

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

Moody's modeled the transaction using CDOEdge, a cash flow model
based on the Binomial Expansion Technique, as described in
Section 2.3 of the "Moody's Global Approach to Rating
Collateralized Loan Obligations" rating methodology published in
August 2017.

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

Par amount: EUR 375,000,000

Diversity Score: 46

Weighted Average Rating Factor (WARF): 2800

Weighted Average Spread (WAS): 3.55%

Weighted Average Recovery Rate (WARR): 44.0%

Weighted Average Life (WAL): 8.5 years

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


BAIN CAPITAL 2018-2: Fitch Assigns B-sf Rating to Class F Certs.
----------------------------------------------------------------
Fitch Ratings has assigned Bain Capital Euro CLO 2018-2 DAC final
ratings, as follows:

Class A: 'AAAsf'; Outlook Stable

Class B-1: 'AAsf'; Outlook Stable

Class B-2: 'AAsf'; Outlook Stable

Class C: 'Asf'; Outlook Stable

Class D: 'BBBsf'; Outlook Stable

Class E: 'BBsf'; Outlook Stable

Class F: 'B-sf'; Outlook Stable

M-1 subordinated notes: 'NRsf'

M-2 subordinated notes: 'NRsf'

Bain Capital Euro CLO 2018-2 DAC is a securitisation of mainly
senior secured loans and bonds (at least 92.5%) with a component
of senior unsecured, mezzanine, high-yield bonds and second-lien
assets. A total note issuance of EUR385.8 million has been used
to fund a portfolio with a target par of EUR375 million. The
portfolio is managed by Bain Capital Credit U.S. CLO Manager,
LLC. The CLO envisages a 4.17-year reinvestment period and an
8.5-year weighted average life (WAL).

KEY RATING DRIVERS

'B' Portfolio Credit Quality

Fitch places the average credit quality of obligors in the 'B'
range. The Fitch weighted average rating factor (WARF) of the
identified portfolio is 31.7.

High Recovery Expectations

At least 92.5% of the portfolio comprises senior secured
obligations. Recovery prospects for these assets are typically
more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch weighted average recovery rating (WARR) of the
identified portfolio is 65.9%.

Diversified Asset Portfolio

The transaction has different Fitch test matrices with different
allowances for exposure to the 10 largest obligors (maximum 18%
and 26.5%). The manager can then interpolate between these
matrices. 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.

Portfolio Management

The transaction features a 4.17-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.

RATING SENSITIVITIES

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

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY

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

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


SETANTA INSURANCE: High Court Approves EUR20MM+ Payouts
-------------------------------------------------------
Mary Carolan at The Irish Times reports that the High Court has
approved payments of more than EUR20 million out of the Insurance
Compensation Fund to meet a 35% shortfall in awards concerning
motorists insured by the collapsed Malta-based insurer Setanta
Insurance.

The payment orders were sought by the State Claims Agency and
were granted on Nov. 19 by the President of the High Court,
Mr. Justice Peter Kelly, The Irish Times relates.  They relate to
1,268 eligible claims and will involve total payments of
EUR20,647,966, representing an additional 35% of money due, The
Irish Times discloses. The application arose from the collapse in
2014 of Setanta which, at the date of liquidation, had about
75,000 policy holders, The Irish Times notes.

According to The Irish Times, the High Court has approved
payments of more than EUR20 million out of the Insurance
Compensation Fund to meet a 35% shortfall in awards concerning
motorists insured by the collapsed Malta-based insurer Setanta
Insurance.  The payment orders were sought by the State Claims
Agency and were granted on Nov. 19 by the President of the High
Court, Mr. Justice Peter Kelly, The Irish Times states.  They
relate to 1,268 eligible claims and will involve total payments
of EUR20,647,966, representing an additional 35% of money due,
according to The Irish Times.  The application arose from the
collapse in 2014 of Setanta which, at the date of liquidation,
had about 75,000 policy holders, The Irish Times recounts.

In court documents, Ciaran Breen, director of the SCA, said
eligible claims by Setanta policy holders can be divided into
claims caused as a result of an accident, known as first-party
claims, and claims by third parties against Setanta's policies,
The Irish relays.  He said this was the fourth High Court
application since 2016 for approvals of payments out of the fund
concerning Setanta, The Irish notes.


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ITALY: Wants to Avoid European Sanctions Over 2019 Budget
---------------------------------------------------------
Angelo Amante and Riccardo Bastianello at Reuters report that
Italy's government is looking to avoid European sanctions over
its 2019 budget, Deputy Prime Minister Luigi Di Maio said on
Nov. 15 while stressing he did not want Italians to have to foot
the bill.

According to Reuters, on Nov. 14, Italy re-submitted its draft
2019 budget to the EU Commission with the same growth and deficit
assumptions as a draft previously rejected for breaching EU
rules, stepping up its showdown with Brussels.

The EU sent back Italy's previous draft last month because its
growth assumptions were too high, the deficit too large and debt
not low enough, Reuters recounts.

It now has the option of starting disciplinary steps against
Rome, which could eventually end in fines for Italy, although
this option has never been used so far, Reuters discloses.

Earlier on Nov. 15, two Italian dailies reported Prime Minister
Giuseppe Conte was trying to convince Brussels any sanctions
imposed on Rome over the budget should be for breaching EU fiscal
rules on excessive deficit rather than debt, Reuters relates.


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L U X E M B O U R G
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ORION ENGINEERED: Moody's Hikes CFR to Ba2, Outlook Stable
----------------------------------------------------------
Moody's Investors Service has upgraded the corporate family
rating of rubber and specialty carbon black manufacturer Orion
Engineered Carbons S.A. to Ba2 from Ba3. Concurrently Moody's
upgraded Orion's probability of default rating to Ba2-PD from
Ba3-PD. Moody's has also upgraded to Ba2 from Ba3 the rating of
the term loan facilities and of the EUR175 million multi-currency
revolving credit facility borrowed by Orion Engineered Carbons
GmbH and OEC Finance US LLC, two indirect subsidiaries of Orion.
The outlook on all ratings is stable.

RATINGS RATIONALE

The upgrade of Orion's CFR to Ba2 acknowledges the positive track
record of the company over the last two years with solid
financial metrics and liquidity profile, which Moody's deems
commensurate with the higher CFR. In addition, the company is now
fully listed on the New York Stock Exchange and despite the
announcement of a $40 million share buy back program, has a quite
conservative financial policy with a net debt leverage target
ratio of between 2x and 2.5x.

Over the last three years the company has improved its Moody's
adjusted EBITDA to $250 million in 2017 from $220 million in 2015
maintaining its Moody's adjusted EBITDA margin in the high teens.
The EBITDA improvement mostly results from the improved cost
base, the effective raw material price increase pass through to
customers and the improved product mix with a greater share of
specialty products. The higher EBITDA, in combination with a
voluntary debt repayment made in 2017 led to a decrease of the
Moody's adjusted leverage to 2.9x at the end of 2017 from 3.2x at
the end of 2016. Moody's believes that the company will be able
to maintain its solid profitability over the next 12-18 months,
keeping its Moody's adjusted leverage at around 2.5x.

Orion's business profile is further strengthened by the capacity
increase in specialised carbon black products where it can
extract higher pricing than in the more commoditised parts of the
rubber business. The specialty segment has grown both organically
through debottlenecking and through targeted bolt-on
acquisitions, the most recent being the acquisition of French
acetylene carbon black manufacturer SociÇtÇ du Noir d'AcÇtyläne
de l'Aubette, SAS (SN2A) closed on October 31, 2018. The company
should continue to benefit from the demand growth in specialty
products driven by more demanding applications and higher quality
specification in the automotive and coating industries.

The CFR is supported by Orion's (1) strong market position as the
global leader in the specialty carbon black segment and as the
third largest global producer of rubber carbon blacks; (2) long-
standing relationships with blue-chip customers; (3) well
maintained and flexible manufacturing asset base spread across
the key regions of North and Latin America, Europe and Asia; (4)
continued progress with regard to the percentage of customer
contracts containing indexed pricing formulas and raw material
price surcharge mechanisms to enable a timely and efficient cost-
pass through; and (5) solid operating profitability, with an
adjusted EBITDA margin in the high teens.

The CFR however reflects (1) Orion fairly modest scale, with
revenues of approximately $1.3 billion in 2017; (2) the
cyclicality of its rubber carbon black profitability given an
exposure to the automotive market; (3) a high level of customer
concentration in the rubber carbon black business, where the top
five customers are global tire manufacturers which accounted for
approximately 48% of 2017 rubber carbon black sales volumes,
although about 70% of tire demand is for replacement tires rather
than new; and (4) the carbon black production's dependency on
availability of a range of feedstock (carbon black oil, crude
coal tar and coal tar distillate), which are by-products of
refineries and coking plants. Feedstock prices are volatile being
correlated to oil price, but typically passed through to
customers via contractual agreements.

Moody's expects that the company will be able to maintain its
strong operating profitability for 2018 with Moody's adjusted
EBITDA between $305 million and $315 million. This should
translate into solid operating cash flows, with Moody's adjusted
funds from operations (FFO) anticipated between $220 million and
$230 million. However, due to a combination of high working
capital requirements estimated of around $75 million, capital
expenditures of around $125 million (excluding acquisitions) and
dividend payments of $47 million, the company's Moody's adjusted
free cash flow (FCF) is expected to be neutral to $25 million
negative. Orion's cash balance should remain adequate and
expected to range between $35 million and $55 million.

For 2019 Moody's expects the company's Moody's adjusted EBITDA to
range between $310 million and $325 million, supported by good
market conditions and improved pricing achieved in the rubber
segment for 2019 contracts. Moody's adjusted EBITDA margin should
remain in the high teens. Moody's adjusted FFO is assumed to
range between $215 million and $240 million. Moody's expects
working capital requirements to ease but to remain at around $45
million and expects continued higher than historical capital
expenditure of around $160 million because of the capacity
expansion in Italy and environmental clean-up expenses in the US.
Orion's Moody's adjusted FCF is expected to be negative in 2019
at around $35 million. FCF is also adversely impacted by the
payment of the $47 million dividend.

Moody's does not expect the company to remain FCF negative in
2020 because of expectations of more modest working capital
requirements and reduction of the capital expenditure to pre
growth expansion programs of around $95 million as the larger
projects would have ended.

LIQUIDITY

Orion's liquidity position is solid and underpinned by cash
balance expected to range between $35 million and $45 million at
year end pro forma for the French acquisition payment of about
$35 million and a large and undrawn RCF of EUR175 million. There
is no refinancing risk until 2021 when the RCF matures. The term
loans maturity has been extended to July 2024. Moody's expects
Orion to be in compliance with its only financial covenant (Net
Debt/EBITDA ratio), if the ratio needs to be tested on the RCF,
which would only happen if the facility is drawn above a 35%
threshold.

RATIONALE FOR STABLE OUTLOOK

Orion's stable outlook reflects Moody's view that the company
will continue to operate at satisfactory margin levels, with
Moody's adjusted leverage ratio expected to remain at around 2.5x
in the next 12-18 months. The stable outlook also assumes that
the company will maintain its solid liquidity profile.

STRUCTURAL CONSIDERATIONS

The Ba2 rating on the senior secured bank facilities (term loan
facility and RCF) is in line with the CFR and reflects the
dominant position of these debt instruments in the current
capital structure of Orion.

What Could Change the Rating Up

Moody's views a potential upgrade limited in the short term by
the company's relatively small size. However, an upgrade could be
considered in case of (1) continued growth of the share of
specialty segment in the company's product mix that would enhance
its profitability resilience through the cycle while achieving a
larger revenue size; (2) Moody's adjusted debt/EBITDA ratio
trends towards 2x; (3) retained cash flow (RCF)/debt ratio
remains above 20%; and (4) the company maintaining strong
liquidity profile underpinned by positive free cash flow, all on
a sustained basis.

What Could Change the Rating Down

Downward ratings pressure could occur if (1) Moody's adjusted
debt/EBITDA rises above 3x on a sustained basis; (2) retained
cash flow (RCF)/debt ratio decline to below 15%; (3) free cash
flow remains negative over several years and the company loses
its headroom under its revolving credit facility financial
covenant.

PRINCIPAL METHODOLOGY

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

Orion, whose Luxembourg based parent company is publicly listed
on the NY Stock Exchange, is the third-largest global producer of
rubber carbon black by capacity and the largest global producer
of specialty carbon black by both volumes and revenue. In 2017
the company reported revenue of $1.3 billion and an EBITDA as
adjusted by the company of $255 million. The company has 14
plants (including joint ventures) across Europe, North and South
America, South Africa and Asia, including a plant in China
acquired from Evonik Industries AG ('Evonik', Baa1 stable).

Orion was formed on July 29, 2011, following the leveraged buyout
of the carbon black operations from Evonik. Since December 2017
the company is fully floated on the NYSE and its market
capitalization was of around $1.6 billion at the end of March
2017.


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


NORWEGIAN AIR 2016-1: Fitch Cuts Class B Certs. Rating to B
-----------------------------------------------------------
Fitch Ratings has downgraded Norwegian Air Shuttle ASA's (NAS,
Not Publically Rated) aircraft Enhanced Pass Through Trust
Certificates, Series 2016-1 as follows:

  -- Class A certificates due in May 2028 to 'A-' from 'A';

  -- Class B certificates due in November 2023 to 'B' from 'BB-'.

The downgrades are driven by the general deterioration of NAS's
corporate credit profile in Fitch's view. The final legal
maturities for the class A and the class B certificates are
scheduled to be 18 months after the due dates.

KEY RATING DRIVERS

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

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

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

A Tranche Ratings and Fitch's Stress Case:

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

These assumptions produce a maximum stress LTV of 90.9% through
the life of the deal, which is nearly unchanged when compared to
91% as of December 2017. The 90.9% stressed LTV implies full
recovery prior to default for the senior tranche holders in what
Fitch considers to be a harsh stress scenario and the stress
results support the 'A-' rating of the class A certificates.

B Tranche Ratings:

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

Affirmation Factor:

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

The 737-800s represent an integral part of NAS' fleet. Norwegian
operates a single fleet type consisting of 737-800s and 737-MAX
8s in its short-haul fleet. As of Nov. 15, 2018, NAS operates a
fleet of 118 737-800s, 14 737-MAX 8s and 31 787 Dreamliners
(both -8 and -9 variants). Fitch expects the percentage of the
pool compared to the NAS' total narrow body fleet will drop
considerably over the course of the transaction, given the
airline's high rate of growth and its current order book. The
company has a sizable firm order book of 737 MAX 8s, A320neos and
A321neos and has additional purchase rights for 737 MAX 8s, A320-
neos and 787-9s.

In a typical EETC transaction rated by Fitch, the underlying
collateral has clear affirmation advantages over other aircraft
in the obligor airline's fleet. In Fitch's view, this pool of 10
737-800s does not have a significant age advantage over the other
737-800s in the company's fleet because the entire fleet of NAS's
737-800s is quite young. The 737-800s in this transaction do not
represent the most attractive/fuel efficient aircraft in NAS'
fleet as the company already operates 14 Boeing 737-MAX 8s.

Irish Insolvency Law:

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

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

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

DERIVATION SUMMARY

Stressed LTVs for the class A certificates in this transaction
are in line with 'A' rated senior classes of EETCs issued by
Spirit Airlines, Inc., United Airlines, Inc., British Airways,
and American Airlines, Inc. Fitch believes that this
transaction's structure and overcollateralization is comparable
with the recent precedents, and the quality of the underlying
collateral pool is as good or better. The 'A-' rating for the
certificates is driven by Fitch's view that NAS's corporate
credit profile is significantly lower than those of other
airlines issuing EETC transactions.

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

KEY ASSUMPTIONS

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

RATING SENSITIVITIES

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

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

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

LIQUIDITY

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

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

FULL LIST OF RATING ACTIONS

Fitch has downgraded the following ratings:

Norwegian Air Shuttle ASA Enhanced Pass Through Certificates,
Series 2016-1

  -- Class A certificates to 'A-' from 'A';

  -- Class B certificates to 'B' from 'BB-'.


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


BBVA LEASING 1: Fitch Raises Class B Notes Rating from 'BB+sf'
--------------------------------------------------------------
Fitch Ratings has upgraded BBVA Leasing 1, FTA's class B notes
and affirmed the class C notes, as follows:

EUR11.3 million Class B notes upgraded to 'A-sf' from 'BB+sf';
Outlook Stable

EUR61.3 million Class C notes affirmed at 'Csf'; Recovery
Estimate 20%

BBVA Leasing 1 FTA is a securitisation of a pool of leasing
contracts originated by Banco Bilbao Vizcaya Argentaria S.A.
(BBVA; A-/Stable/F2). The leasing contracts are extended to non-
financial small- and medium-sized enterprises domiciled in Spain.
BBVA is also servicer, account bank and swap provider for the
transaction.

KEY RATING DRIVERS

Increasing Class B Credit Enhancement (CE)

CE for the class B notes has continued to increase to 66.4% from
42% since the last annual review. The class A notes have been
paid in full and the class B notes are now the most senior class
outstanding. The balance of the class B notes has decreased to
EUR 11.3 million from EUR 28.1 million over the last 12 months.

Large Principal Deficiency Ledger (PDL)

The class C notes are under-collateralised as the transaction
maintains a large PDL of EUR38.3 million as of August 31, 2018
due to the weak past collateral performance. Consequently, Fitch
believes the class C notes' default is inevitable, as reflected
by their 'Csf' rating. Fitch has maintained the Recovery Estimate
at 20% as the PDL has remained stable.

Highly Concentrated Portfolio

The portfolio has high levels of concentration due to the
amortisation of the collateral. Only 1.4% of the original
collateral remains outstanding and the top 10 obligor
concentration has increased to 20.8% from 17.9% of the
outstanding collateral balance. The largest industry and
geographical concentrations are to real estate and Cataluna,
which represent 31.9% and 34.8% of the portfolio, respectively.

Stable Performance

Cumulative loss rates have remained stable at around 2.8% since
the last annual review due to the limited defaults and recoveries
in the transaction over the last year. 90dpd delinquencies
increased to 1.3% from 0.5% and appear volatile but this is due
to the low granularity of the portfolio as small number of
receivables can result in sharp movements of delinquency ratios.

RATING SENSITIVITIES

The class B notes' rating is relatively robust to asset
assumptions due to the high CE and low remaining balance.
However, the transaction could be exposed to significant
performance volatility due to the high concentration levels of
the portfolio. The class C notes' rating would be unaffected
because it is already at a distressed level.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY

Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset
pool and the transaction. There were no findings that affected
the rating analysis. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.

Fitch did not undertake a review of the information provided
about the underlying asset pool ahead of the transactions initial
closing. The subsequent performance of the transaction over the
years is consistent with the agency's expectations given the
operating environment and Fitch is therefore satisfied that the
asset pool information relied upon for its initial rating
analysis was adequately reliable.

Overall and together with the assumptions referred to, Fitch's
assessment of the information relied upon for the agency's rating
analysis according to its applicable rating methodologies
indicates that it is adequately reliable.


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


EUROCHEM GROUP: S&P Alters Outlook to Pos. & Affirms 'BB-' ICR
--------------------------------------------------------------
S&P Global Ratings said that it had revised its outlook on
agricultural chemicals producer EuroChem Group AG to positive
from stable, and affirmed its 'BB-' long-term issuer credit
rating.

At the same time, S&P affirmed the 'BB-' issue ratings on
EuroChem's existing senior unsecured debt.

S&P said, "We revised the outlook to positive because we might
raise the rating during the next year, given our expectation that
EuroChem will improve its adjusted funds from operations (FFO) to
debt to about 20% in 2018, and further to around 30% in 2019. Our
expectation is supported by the improving pricing environment in
the fertilizer industry, with prices bottoming out after
prolonged low-cycle conditions. We also factor in recent ruble
depreciation supporting EuroChem's margins. In addition, we take
into account that the capital expenditures (capex) should
decrease to $800 million in 2019 from $1.3 billion in 2018, as
EuroChem has passed the peak of its investment cycle related to
two greenfield potash projects, Usolskiy and VolgaKaliy, and a
new ammonia production facility in Kingisepp. Finally, we expect
that EuroChem will remain committed to its financial policy,
targeting net reported debt to EBITDA of 2.5x, and will
proactively refinance substantial debt maturities of $1.9 billion
due in 2020."

EuroChem's adjusted EBITDA reached $1.4 billion for the 12 months
ended Sept. 30, 2018, compared with $1.1 billion in the same
period last year. S&P forecasts that EuroChem will report EBITDA
of about $1.4 billion for the whole of 2018, materially higher
than $1.1 billion in 2017. The company's EBITDA benefits from
improved industry conditions and a weaker ruble exchange rate of
more than Russian ruble (RUB)65 per $1 compared with the average
rate of less than RUB60 in 2017 and the first half of 2018.

S&P said, "We forecast EuroChem's adjusted EBITDA will continue
improving to around $1.8 billion in 2019 and $2 billion in 2020,
largely thanks to higher production volumes and a gradual shift
of the product portfolio in favor of more complex fertilizers
following the ramp-up of expansionary projects starting from
2018.

"At the same time, we expect that EuroChem's free operating cash
flow (FOCF) will remain negative in 2018, but will turn positive
in 2019 as the peak of investment in capacity expansion has
passed and capex will decrease to about $800 million in 2019 and
$500 million in 2020, from $1.3 billion-$1.5 billion per year
during its key investment phase in 2016-2018. This should allow
EuroChem to gradually decrease its adjusted debt to around $4.5
billion in 2019 from our adjusted $4.9 billion figure as of Sept.
30, 2018 (we add to debt $850 million in drawings from the $1.5
billion committed perpetual facility).

"Our rating on EuroChem remains supported by the significant
scale of the company's business. It is the fifth-largest global
fertilizer company by sales ($4.9 billion in 2017) ahead of K+S
($4.3 billion in 2017), and well ahead of other large Russian
fertilizer companies PhosAgro ($3.2 billion) and Uralkali ($2.8
billion). Our view of EuroChem's business reflects its favorable
position on the phosphate feedstock cost curve (first quartile)
where its key advantage stems from lower ammonia and sulfur
costs. In urea, EuroChem is now also in the first quartile on the
global cost curve, underpinned by lower gas prices for Russian
producers and the weakening ruble exchange rate. We also factor
in the availability of byproducts (gas condensate, baddeleyte,
and iron ore)." Higher transportation and freight costs than
peers positioned closer to end-user markets somewhat limit the
company's cost position.

In potash, EuroChem expects to produce around 1.4 million metric
tons in 2019, mostly through the Usolsky plant. The company's
cost position should gradually improve with scale, and management
expects to be positioned in the first quartile of this market in
2022 when the two projects will deliver around 6 million metric
tons. Cost benefits should come from high potassium chloride
content, relative proximity to the Tuapse port at the Black Sea,
and from modern equipment.

EuroChem's business risk profile further benefits from its
distribution and logistics network, which includes a wide
distribution platform in the Commonwealth of Independent States,
the U.S., Latin America, Europe, and Asia; maritime transshipment
facilities in Russia, Estonia, and Belgium; as well as EuroChem's
fleet of railcars and locomotives.

S&P said, "Our assessment of EuroChem's business risk profile is
constrained by the location of most of group's assets in Russia,
where we view country risk as high. We also take into
consideration high cyclicality in the fertilizer industry and the
fragmented nature of the nitrogen fertilizer industry in which
the company has the highest exposure. In addition, we factor in
operational risks related to the potash projects; in particular
the VolgaKaliy project, where the previous leaks in the shafts
are currently being rectified.

"The positive outlook reflects our expectation that we could
raise our rating on EuroChem in the next year. We expect the
company to maintain an adjusted FFO-to-debt ratio of more than
20%, because we anticipate that recovering prices for fertilizers
and the weakened ruble will support EuroChem's operating
performance in 2019-2020.

"We could revise outlook back to stable if fertilizer prices
declined materially or the ruble appreciated significantly
against the U.S. dollar, which would result in the FFO-to-debt
ratio falling below 20% without near-term prospects of recovery.
We could also take a negative rating action if EuroChem
substantially increases shareholder remuneration, putting
pressure on the company's leverage.

"We could raise the rating in the next year if EuroChem
demonstrates sustainable FOCF generation, ramps up the production
at the greenfield potash projects and the new ammonia project in
line with its current plan, and maintains adequate liquidity. We
consider an adjusted FFO-to-debt ratio of more than 20% as
commensurate with a higher rating."


LAFARGEHOLCIM HELVETIA: S&P Rates New Hybrid Securities 'BB+'
-------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' long-term issue rating to
the proposed new subordinated securities to be issued by
LafargeHolcim Helvetia Finance Ltd., a 100% owned and controlled
finance subsidiary of Switzerland-based building materials maker
LafargeHolcim Ltd., which will guarantee the proposed notes.

S&P said, "We expect LafargeHolcim will exhibit a ratio of
outstanding hybrids to adjusted capitalization well below the 15%
threshold for us to view hybrid leverage as having intermediate
equity content. The proposed issuance follows the earlier
issuance proposal of Holcim Finance (Luxembourg) S.A., which the
group announced in May 2018 and which has not taken place so far.

"We classify the proposed new subordinated securities as having
intermediate equity content until the first reset date. This is
because the securities meet our criteria in terms of
subordination, permanence, and optional deferability during this
period. Consequently, when we calculate LafargeHolcim's adjusted
credit ratios, we will treat 50% of the principal outstanding and
accrued interest under the proposed securities as equity rather
than debt, and 50% of the related payments on these securities as
equivalent to a common dividend.

"The two-notch difference between our 'BB+' issue rating on the
proposed hybrid notes and our 'BBB' issuer credit rating (ICR) on
LafargeHolcim Ltd. signifies that we have made the following
downward adjustments from the ICR:

-- One notch for the proposed notes' subordination, because
    S&P's long-term ICR on LafargeHolcim is investment grade; and

-- An additional notch for payment flexibility due to the
    optional deferability of interest.

S&P said, "The notching of the proposed securities reflects our
view that LafargeHolcim Ltd. is relatively unlikely to defer
interest payments. Should our view change, we may significantly
increase the downward notches that we apply to the issue rating.
We may lower the issue rating before we lower the ICR."

KEY FACTORS IN S&P'S ASSESSMENT OF THE INSTRUMENT'S PERMANENCE

Although the proposed securities are perpetual, LafargeHolcim
Ltd. can redeem them as of the first call date--which falls more
than five years and three months after the issue date--and on
each annual interest payment date thereafter. If any of these
events occur, the company intends to replace the proposed
instrument, although it is not obliged to do so. In S&P's view,
this statement of intent mitigates the issuer's ability to
repurchase the notes.

The interest to be paid on the proposed securities will increase
by 25 basis points (bps) five years after the first reset, and by
a further 75 bps 20 years after the first reset date. S&P views
the cumulative 100 bps as a moderate step-up that provides
LafargeHolcim with an incentive to redeem the instruments at such
time.

S&P said, "Consequently, we will no longer recognize the proposed
instrument as having intermediate equity content after the first
reset date because the remaining period until its economic
maturity would, by then, be less than 20 years.

"However, we classify the instrument's equity content as
intermediate until its first reset date, as long as we think that
the loss of the beneficial intermediate equity content treatment
will not cause the issuer to call the instrument at that point."

KEY FACTORS IN S&P'S ASSESSMENT OF THE INSTRUMENT'S SUBORDINATION

The proposed securities will be deeply subordinated obligations
of LafargeHolcim Ltd. and have a perpetual maturity. As such,
they will be subordinated to senior debt instruments, and only
senior to junior obligations (common share capital) of the group.

KEY FACTORS IN S&P'S ASSESSMENT OF THE INSTRUMENT'S DEFERABILITY

S&P said, "In our view, LafargeHolcim's option to defer payment
of interest on the proposed securities is discretionary. It may
therefore choose not to pay accrued interest on an interest
payment date because it has no obligation to do so. However, any
outstanding deferred interest payment would have to be settled in
cash if an equity dividend or interest on equal-ranking
securities is paid, or if common shares or equal-ranking
securities are repurchased.

"That said, this condition remains acceptable under our rating
methodology because, once the issuer has settled the deferred
amount, it can choose to defer payment on the next interest
payment date."

The issuer retains the option to defer coupons throughout the
instrument's life. The deferred interest on the proposed
securities is cash cumulative and compounding.


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


EKSPO FAKTORING: Moody's Withdraws B3 CFR for Business Reasons
--------------------------------------------------------------
Moody's Investors Service has withdrawn Ekspo Faktoring A.S.'s B3
corporate family ratings, the B3 issuer ratings and the Ba2.tr
national scale ratings for its own business reasons. At the time
of the withdrawal the outlook on the ratings was negative.

RATINGS RATIONALE

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

LIST OF AFFECTED RATINGS

Issuer: Ekspo Faktoring A.S.

Withdrawals:

Long-term Corporate Family Rating (Foreign Currency), previously
rated B3, outlook changed to Rating Withdrawn from Negative

Long-term Corporate Family Rating (Local Currency), previously
rated B3, outlook changed to Rating Withdrawn from Negative

Long-term Issuer Rating (Foreign Currency), previously rated B3,
outlook changed to Rating Withdrawn from Negative

Long-term Issuer Rating (Local Currency), previously rated B3,
outlook changed to Rating Withdrawn from Negative

National Scale Rating Long-term Issuer Rating (Local Currency),
previously rated Ba2.tr

Outlook Action:

Outlook changed to Rating Withdrawn from Negative


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


UKRAINE: Sale of Insolvent Banks' UAH5.8-Bil. Asset Pool Fails
--------------------------------------------------------------
Ukrainian News Agency reports that the Deposit Guarantee Fund
said in a statement the sales of a pool of insolvent banks'
assets pawned to the National Bank of Ukraine worth UAH5.8
billion failed for technical reasons.

The DGF and the NBU for almost a year were preparing the sales of
a large pool of assets pawned to the NBU, Ukrainian News relates.

The sales were to be done through the First Financial Network
Ukraine limited liability company, a subsidiary of the First
Financial Network (FFN), Ukrainian News notes.

The pool included assets of three banks -- Delta Bank,
Eurogasbank and Active-Bank for the amount over UAH5.8 billion,
Ukrainian News discloses.

The auction was to be conducted under a Dutch model,
Ukrainian News states.  The DGF made all the necessary
preparatory works, Ukrainian News relays.  The sales failed for
technical reasons, according to Ukrainian News.  The pool will be
set for another sale soon, Ukrainian News says.


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


DRL HOLDINGS: S&P Assigns Preliminary B- Issuer Credit Rating
-------------------------------------------------------------
S&P Global Ratings said that it assigned its preliminary 'B-'
long-term issuer credit rating to DRL Holdings PLC, the parent of
U.K.-based bed and mattress retailer, Dreams (collectively, the
group). The outlook is stable.

S&P said, "We also assigned our preliminary 'B-' issue rating to
the group's proposed four-year EUR175 million senior secured
notes, which will be issued by DRL Holdings PLC. The preliminary
recovery rating on these notes is '3', indicating our
expectations of meaningful recovery (30%-50%; rounded estimate:
50%) in the event of default.

"At the same time, we assigned our preliminary 'B+' issue rating
to the group's proposed GBP9.3 million super senior revolving
credit facility (RCF), borrowed by Dreams Ltd. The preliminary
recovery rating on the facility is '1', indicating our
expectations of very high recovery prospects (90%-100%; rounded
estimate: 95%) in the event of default.

"The final ratings are subject to the successful issuance of the
notes, implementation of the new super senior facilities, and our
review of the final documentation. If S&P Global Ratings does not
receive the final documentation within a reasonable timeframe, or
if the final documentation departs materially from those that we
have already reviewed, we reserve the right to withdraw or revise
our ratings."

The preliminary ratings reflect Dreams' position as the leading
retailer of beds and mattresses in the U.K.; its vertical
integration given its manufacturing facility and in-house
delivery service; its moderate working capital investment
requirements; and the relatively modest leverage post-
transaction, compared with peers.

At the same time, the group's limited overall scale, significant
geographic and product concentrations, and limited cash flow
coverage of its store occupancy costs and mandatory debt
amortization, all constrain the ratings. Dreams is also exposed
to potential currency fluctuations, given a lack of hedging on
the proposed euro-denominated notes.

S&P said, "Dreams operates in a fiercely competitive and
relatively small market. As such, its strong share of the U.K.
bed and mattress market does not directly translate into
significant scale, while future growth prospects are somewhat
limited, in our opinion.

"We believe that trading conditions for discretionary goods
retailers in the U.K. will remain extremely challenging through
the remainder of 2018 and into 2019 as consumer confidence
remains low, exacerbated by the increasing possibility of a "hard
Brexit." Moreover, with all of the company's revenues generated
in the U.K., we think the group's relatively small overall scale
of operations exposes it to a further slowdown in U.K. private
consumption."

Dreams' operational gearing remains high on account of its store
estate and large associated rental and other store occupancy
costs. This, combined with substantial other fixed charges such
as interest and mandatory amortization on the proposed notes,
leaves the group with less financial flexibility with which to
absorb any material operating or financial setbacks. This is
somewhat mitigated by S&P's forecast of some modest FOCF
generation in each of the next two years.

Although Dreams' products have a nondiscretionary element, their
relatively high average selling price also means customers tend
to delay purchases when consumer confidence is low. S&P also
believes Dreams' competitive standing to be somewhat exposed to
potential disruption, given that the products it sells do not
typically demand significant brand loyalty.

At the same time, the benefits of operating what is a primarily a
made-to-order business model, in which customers pay for products
in advance, is that intra-year working capital-related cash flows
are smoothed, allowing for better visibility compared to apparel
or DIY retailers, for example.

S&P's base case assumes:

-- About half of the demand for mattresses to be driven by the
    replacement cycle and an ageing population. This part of
    demand is somewhat resilient to broader economic conditions,
    while the remainder is heavily influenced by broader
    macroeconomic conditions. Beyond real GDP growth, Dreams'
    performance is a function of inflation, real consumption
    growth, unemployment, and the volume of housing transactions.
    S&P's assumptions for Dreams reflect its expectations for
    economic conditions in the U.K., the only market in which the
    group operates.

-- Moderate U.K. real GDP growth of 1.2% in financial year
     ending Dec. 21, 2018 (FY2018) and 1.4% in FY2019, along with
     a reduction in real consumption growth -- to 1.1% in both
     2018 and 2019 -- as households continue to reduce their
     spending in light of the uncertain economic outlook. S&P
     expects U.K. consumer price inflation of 2.5% in 2018 and
     1.9% in 2019 -- compared with 2.7% last year.

-- Modest revenue growth of 1%-3% in each of FY2018 and FY2019,
    reflecting modest increases in the size of the store estate,
    continued robust growth online, and low single-digit
    percentage like-for-like sales growth in stores. Inflationary
    cost pressures on account of increases in the national living
    wage and business rates will lead to a modest reduction in
    margins in FY2018. This will exacerbate the modest softening
    of gross margins caused by challenging market conditions.

-- A modest pickup in FY2019 and FY2020 reported EBITDA margins
    as the group's strategic and cost-saving initiatives bear
    fruit and exceptional expenses reduce.

-- Capital expenditure (capex) of up to GBP11 million in FY2018,
    reflecting investment in a new fleet of delivery vehicles.
    From FY2019, S&P expects more modest capex of about GBP8
    million per year.

-- Debt service requirements of GBP20 million and GBP23 million
    in FY2019 and FY2020, respectively, as mandatory amortization
    accelerates.

-- No further dividends.

-- S&P does not deduct any surplus cash from debt.

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

-- Adjusted EBITDA of GBP60 million-GBP70 million in FY2018
    through FY2020 (compared with GBP62.4 million in FY2017).
     These figures correspond to reported EBITDA, after
     exceptional expenses, of about GBP40 million-GBP45 million in
     each of the three years.

-- Adjusted debt to EBITDA of 4.5x-5.0x in FY2018. S&P expects
    earnings growth and mandatory amortization payments will
    result in modest deleveraging toward 4.0x by FY2020.

-- Adjusted funds from operations (FFO) to debt of 12%-15% in
    each of FY2018, FY2019, and FY2020.

-- EBITDAR coverage (defined as reported EBITDA after
    exceptional expenses and before rent, over cash interest plus
    rent) of about 1.7x annually from FY2019.

-- Fixed charge coverage (defined as EBITDA before store
    occupancy costs, to interest, store occupancy costs, and debt
    service) of at least 1.2x from FY 2019. The documentation for
    the proposed RCF contains provision for a minimum EBITDA
    covenant, tested quarterly at GBP26 million. S&P understands
    this covenant will not trigger an event of default if the RCF
    is undrawn, and in such a case this would only trigger a
    drawstop.

S&P said, "We forecast comfortable headroom of more than 30%
under the covenant and therefore envisage full availability of
the RCF. The RCF is also subject to a clean-down provision that
requires RCF drawings to fall to zero for 10 consecutive days,
once a year.

"The stable outlook reflects our opinion that Dreams will
continue to grow its earnings modestly over the next 12 months.
We expect Dreams will be able to cover its fixed charges --
interest, store occupancy costs, and mandatory amortization--from
operating cash flows by at least 1.2x.

"We could lower the ratings in the next 12 months if, on the back
of weaker demand or higher sterling-euro foreign exchange
volatility, Dreams were unable to cover its fixed charges by at
least 1.2x or maintain adequate liquidity. This could lead to
credit metrics that are both weaker than we currently anticipate
and potentially unsustainable in the long term.

"We could also take a negative rating action if Dreams were to
experience operating setbacks, including a loss of market share,
contraction in margins, or worsening of cash generation.

"We believe a positive rating action is unlikely in the near term
due to Dreams' relatively small scale and potential volatility in
both demand for the group's products and its cash flows."


FINSBURY SQUARE 2018-2: Moody's Rates Class X Notes Caa2 (sf)
-------------------------------------------------------------
Moody's Investors Service has assigned definitive long-term
credit ratings to the Notes issued by Finsbury Square 2018-2 plc:

GBP 513.0M Class A Mortgage Backed Floating Rate Notes due
September 2068, Definitive Rating Assigned Aaa (sf)

GBP 30.0M Class B Mortgage Backed Floating Rate Notes due
September 2068, Definitive Rating Assigned Aa2 (sf)

GBP 33.0M Class C Mortgage Backed Floating Rate Notes due
September 2068, Definitive Rating Assigned A1 (sf)

GBP 6.0M Class D Mortgage Backed Floating Rate Notes due
September 2068, Definitive Rating Assigned Baa1 (sf)

GBP 18.0M Class E Mortgage Backed Floating Rate Notes due
September 2068, Definitive Rating Assigned Caa2 (sf)

GBP 13.5M Class X Floating Rate Note due September 2068,
Definitive Rating Assigned Caa2 (sf)

Moody's has not assigned a rating to the GBP 12.0M Class Z Notes
due September 2068, which are also issued at closing of the
transaction.

The portfolio backing this transaction consists of UK prime
residential loans originated by Kensington Mortgage Company
Limited. The loans were sold by KMC to Koala Warehouse Limited at
the time of each loan origination date. On the closing date the
Seller sells the portfolio to Finsbury Square 2018-2 plc.
Approximately 89.0% of the pool have been originated during 2018.

RATINGS RATIONALE

The ratings of the Notes take into account, among other factors:
(i) the performance of the previous transactions launched by KMC;
(ii) the credit quality of the underlying mortgage loan pool;
(iii) legal considerations; (iv) the initial credit enhancement
provided to the senior Notes by the junior Notes and the reserve
fund; and (v) the ability to add new loans to the collateral pool
during the prefunding period before the first interest payment
date which could account for up to 30.7% of the final collateral
pool equivalent to GBP 184 million.

Expected Loss and MILAN CE Analysis

Moody's determined the MILAN credit enhancement (MILAN CE) and
the portfolio's expected loss (EL) based on the pool's credit
quality. The MILAN CE reflects the loss Moody's expects the
portfolio to suffer in the event of a severe recession scenario.
The expected portfolio loss of 2.2% and the MILAN CE of 14.0%
serve as input parameters for Moody's cash flow model and
tranching model, which is based on a probabilistic lognormal
distribution.

Portfolio expected loss of 2.2%: this is higher than the UK Prime
RMBS sector average of ca. 1.1% and was evaluated by assessing
the originator's limited historical performance data and
benchmarking with other UK Prime RMBS transactions. It also takes
into account Moody's stable UK Prime RMBS outlook and the UK
economic environment.

MILAN CE of 14.0%: this is higher than the UK Prime RMBS sector
average of ca. 8.7% and follows Moody's assessment of the loan-
by-loan information taking into account the historical
performance available and the following key drivers: (i) although
Moody's have classified the loans as prime, it believes that
borrowers in the portfolio often have characteristics which could
lead to them being declined from a high street lender; (ii) the
weighted average CLTV of 73.37%; (iii) the very low seasoning of
0.58 years; (iv) the proportion of interest-only loans 21.93%;
(v) the proportion of buy-to-let loans 20.20%; (vi) the absence
of shared equity, fast track or self-certified loans; and (vii)
the possibility for new loans to be added to the collateral pool
by the first interest payment date which could account for up to
30.7% of the final collateral pool equivalent to GBP 184 million.

Transaction structure

At closing the mortgage pool balance consists of GBP 415.9
million of loans. On closing, the Reserve Fund is equal to 2.1%
of the principal amount outstanding of Class A to E Notes and
will be reduced to 2.0% of the original balance of Class A to E
Notes on the first interest payment date. This amount will only
be available to pay senior expenses, Class A, Class B, Class C
and Class D Notes interest and to cover losses. The Reserve Fund
will not be amortising as long as the Class D Notes are
outstanding. After Class D has been fully amortised, the Reserve
Fund will be equal to 0.0%. The Reserve Fund will be released to
the revenue waterfall on the final legal maturity or after the
full repayment of Class D Notes. If the Reserve Fund is less than
1.5% of the principal outstanding of Class A to E, a liquidity
reserve fund will be funded with principal proceeds up to an
amount equal to 2.0% of the Classes A and B.

Operational risk analysis

KMC is acting as servicer and cash manager of the pool from the
closing date. In order to mitigate the operational risk, there is
a back-up servicer facilitator (Intertrust Management Limited,
not rated, also acting as corporate services provider), and Wells
Fargo Bank International Unlimited Company (not rated) is acting
as a back-up cash manager from close.

All of the payments under the loans in the securitised pool will
be paid into the collection account in the name of KMC at
Barclays Bank PLC ("Barclays", A2/P-1 and A2(cr)/P-1(cr)). There
is a daily sweep of the funds held in the collection account into
the issuer account. In the event Barclays rating falls below Baa3
the collection account will be transferred to an entity rated at
least Baa3. There is a declaration of trust over the collection
account held with Barclays in favour of the Issuer. The issuer
account is held in the name of the Issuer at Citibank N.A.,
London Branch (A1/(P)P-1 and A1(cr)/P-1(cr)) with a transfer
requirement if the rating of the account bank falls below A3.

To ensure payment continuity over the transaction's lifetime the
transaction documents including the swap agreement 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. The transaction also
benefits from principal to pay interest for Class A to D Notes,
subject to certain conditions being met.

Interest rate risk analysis

90.0% of the loans in the pool are fixed-rate mortgages, which
will revert to three-month sterling LIBOR plus margin between
February 2019 and September 2023. 10.0% of the loans in the
closing pool are floating-rate mortgages linked to three-month
sterling LIBOR. The Note coupons are linked to three-month
sterling LIBOR, which leads to a fixed-floating rate mismatch in
the transaction. To mitigate the fixed-floating rate mismatch the
structure benefits from a fixed-floating swap. The swap follows a
scheduled notional and will mature the earlier of the date on
which floating rating Notes have redeemed in full or the date on
which the swap notional is reduced to zero. BNP Paribas (Aa3/P-1
and Aa3(cr)/P-1(cr)) acting through its London Branch, is the
swap counterparty for the fixed-floating swap in the transaction.

After the fixed rate loans revert to floating rate, there is a
basis risk mismatch in the transaction, which results from the
mismatch between the reset dates of the three-month LIBOR of the
loans in the pool and the three-month LIBOR used to calculate the
interest payments on the Notes. Moody's has taken into
consideration the absence of basis swap in its cash flow
modelling.

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.

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 downgrade of the ratings.
Deleveraging of the capital structure or conversely a
deterioration in the Notes available credit enhancement could
result in an upgrade or a downgrade of the ratings, respectively.


FINSBURY SQUARE 2018-2: Fitch Assigns CCCsf Rating to Cl. E Debt
----------------------------------------------------------------
Fitch Ratings has assigned Finsbury Square 2018-2 plc's notes
final ratings as follows:

GBP513,000,000 Class A: 'AAAsf'; Outlook Stable

GBP30,000,000 Class B: 'AAsf'; Outlook Stable

GBP33,000,000 Class C: 'Asf'; Outlook Stable

GBP6,000,000 Class D: 'A- sf'; Outlook Stable

GBP18,000,000 Class E: 'CCCsf'; RE 100%

GBP13,500,000 Class X: 'BBsf'; Outlook Stable

GBP12,000,000 Class Z: Not rated

The transaction is a securitisation of owner-occupied and buy-to-
let (BTL) mortgages originated in the UK by Kensington Mortgage
Company Limited. The transaction features recent origination and
the residual origination of the Gemgarto 2015-2 transaction.

KEY RATING DRIVERS

Pre-funding Mechanism

The transaction contains a pre-funding mechanism through which
further loans may be sold to the issuer, with proceeds from the
over-issuance of notes at closing standing to the credit of the
pre-funding reserves. Fitch has received loan-by-loan information
on additional mortgage offers that could form part of the
collateral once advanced by the seller. However, Fitch has
assumed the pool will evolve to the maximum extent permitted by
the constraints outlined in the transaction documents.

Product Switches Permitted

Eligibility criteria govern the type and volume of product
switches, but these loans may earn a lower margin than the
reversionary interest rates under their original terms. Fitch has
assumed the portfolio quality will migrate to the weakest
permissible under the product switch restrictions.

CRITERIA VARIATIONS

Help-to-Buy Equity Loans

Eight percent of the pool comprises loans in which the UK
government has lent up to 40% (in London) and 20% (out of London)
of the property purchase price in the form of an equity loan.
This allows borrowers to fund a 5% cash deposit and mortgage the
remaining balance. When determining these borrowers' foreclosure
frequency (FF) via debt-to-income and sustainable loan-to-value
ratios, Fitch has taken the balances of the mortgage loan and
equity loan into account.

Self-employed Borrowers

Kensington may choose to lend to self-employed individuals with
only one year's income verification completed. Fitch believes
that this practice is less conservative compared with other prime
lenders. Fitch applied an increase of 30% to the FF for self-
employed borrowers with verified income instead of the 20%
increase, as per its criteria.

RATING SENSITIVITIES

Material increases in foreclosure frequency and/or reductions in
recovery rates on foreclosed properties producing losses greater
than Fitch's base case expectations may result in negative rating
action on the notes. Fitch's analysis showed that a 30% increase
in the weighted average FF, along with a 30% decrease in the
weighted average recovery rate, would imply a downgrade to 'AA-
sf' from 'AAAsf'.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY

Fitch reviewed the results of a third-party assessment conducted
on the asset portfolio information, and concluded that there were
no findings that affected the rating analysis.

Fitch conducted a review of a small targeted sample of
Kensington's origination files and found the information
contained in the reviewed files to be adequately consistent with
the originator's policies and practices and the other information
provided to the agency about the asset portfolio.

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.


JAGUAR LAND ROVER: Fitch Lowers LT IDR to BB, Outlook Negative
--------------------------------------------------------------
Fitch Ratings has downgraded Jaguar Land Rover Automotive plc's
(JLR) Long-Term Issuer Default Rating (IDR) and senior unsecured
rating to 'BB' from 'BB+'. The Outlook on the IDR is Negative.

The rating actions reflect Fitch's revised projections for
revenue, earnings and cash generation in the next two to three
years, following JLR's half year results ending September 2018
and recent adverse market developments in JLR's main end-markets,
notably China. Fitch now expects JLR to make operating losses in
the financial year ending March 2019 (FY19) and only a moderate
recovery in operating margin to below 1% in FY20. Fitch also
expects significantly negative free cash flow (FCF) around 5.5%-
7.5% in FY19 and FY20 and still moderately negative in FY21,
worse than its previous projections of about negative 2% in FY20
and positive in FY21. The Negative Outlook reflects the impact
that could result from a disorderly Brexit, which could affect
JLR disproportionately compared with its main peers because of
its significant production bias to the UK. It also reflects the
risks of a further delay in FCF and profitability reaching an
inflexion point.

KEY RATING DRIVERS

Revised Profitability Expectations: Fitch expects JLR's earnings
to be further impacted by a combination of lower revenue growth,
weak net pricing, higher production costs as well as rising
depreciation costs from recent investments. Nevertheless, renewed
cost actions should limit the decline in profitability and
support a gradual recovery. JLR's 1H19 revenue and earnings were
lower than the group's and Fitch's previous expectations and led
to a downward revision of the FY19 EBIT margin guidance to
breakeven from 4%-7%. Fitch's projections are more conservative
and Fitch now anticipates some moderate operating losses in FY19
and only a modest recovery to below 1% in FY20.

Sustained Negative FCF: FCF fell significantly in FY18 to
negative 4.2% and Fitch expects a further deterioration to
between 7%-7.5% in FY19. The company guided towards lower
investments than previously announced but Fitch expects high
capex between GBP3.5 billion-GBP4.0 billion in 2019-2021 and
lower profitability to keep FCF between negative 5%-6% in FY20
and still in negative territory in FY21.

Weakening Financial Metrics: Fitch's projections for extremely
negative FCF in FY19 and FY20 could result in an increase of FFO
adjusted net leverage to just less than 1.0x at end-FY19 and
about 1.0x-1.2x at end-FY20 and FY21. The combination of
declining funds from operations (FFO) and higher debt led JLR to
move to an adjusted net debt position at end-FY18 from an
adjusted net cash position at end-FY17. FFO adjusted net leverage
was 0.1x at end-FY18, compared with negative 0.2x at end-FY17.

Material Brexit Risks: A disorderly Brexit may significantly
disrupt the group's supply chain and ability to manufacture and
sell its vehicles, in turn putting material additional pressure
on earnings and cash generation compared with its current
projections. The group sells about 20% of its vehicles in both
continental Europe and the US, but builds them almost exclusively
in the UK, making it particularly exposed to Brexit issues and
risks related to potential increased global tariffs. New assembly
plants in Slovakia and Brazil and the use of a subcontractor in
Austria should somewhat ease the production imbalance in the
medium term, but the group remains heavily at risk in the short
term. A potential weakening of sterling in a hard Brexit scenario
would partly offset some of the short-term costs.

Significant Capex: Fitch expects JLR's bold investment plan to
bolster the group's business profile by improving the
manufacturing footprint outside of the UK and by enhancing JLR's
agility to respond to key sector trends. However, capex cannot
easily be postponed or cut materially in case it hinders the
group's long term positioning, so this will limit the company's
flexibility to limit free cash absorption.

Limited Scale and Product Diversity: JLR's scale and range of
products are smaller than premium-segment peers, which raises the
risk of volatility in earnings and cash flow, and constrains the
group's business profile. However, JLR's recent heavy investments
are increasing the group's product breadth and volume, helping to
diminish this business risk. In particular, JLR is increasing its
focus on electrification, autonomous driving and shared mobility.
The group also benefits from its brands' solid reputation and
history, and notably, Land Rover's undisputed market position and
track record in the booming SUV segment.

Geographic Diversification Improving: JLR's efforts over the last
five years have helped it achieve a more balanced geographic mix,
with over half of retail sales volumes outside of Europe. JLR's
growth in China has been rapid and the group is the fourth-
largest automaker in the premium segment by volume after Audi,
BMW and Mercedes. Nonetheless, the Chinese premium car market has
matured and growth rates and pricing are weakening materially.
This is likely to put pressure on JLR's revenue and earnings in
the foreseeable future.

Efficiency Requirements More Challenging: Tightening emission
requirements in both developed and developing countries remain a
challenge for JLR, as its product portfolio is currently weighted
towards larger, less fuel-efficient SUVs. JLR's product portfolio
is also heavily biased towards diesel, which accounts for about
80% of JLR's sales in Europe, against a background of falling
diesel powertrain sales in the region. The group is increasing
flexibility through its new modular platform and is broadening
its product line to include more compact, fuel-efficient models,
but material uncertainty remains about the speed and extent of
powertrain shift, notably in Europe.

DERIVATION SUMMARY

JLR competes in the profitable premium segment with Daimler AG's
Mercedes (A-/Stable), BMW AG and the multi-brand Volkswagen AG
(BBB+/Stable), notably Audi, but it lacks the scale of its much
larger German peers. The group's limited product portfolio and
lower diversification are a constraint on the ratings, but the
model range is expanding and the product track record has built
up in the past three to five years.

Profitability and cash generation have historically been stronger
than its mass market peers, Fiat Chrysler Automobiles N.V.  (FCA,
BB/Positive), Peugeot S.A. (PSA, BBB-/Stable) and Renault SA
(BBB/Stable), and in line with German premium manufacturers.
However, the profitability decline in 2017-2018 is putting JLR at
a major disadvantage compared with its main peers as JLR is
currently undergoing a period of challenges and significant
expansion, both with respect to capacity and product range,
resulting in negative FCF and lower margins than its through-the-
cycle average.

Fitch expects JLR's capital structure to weaken. Fitch forecasts
FFO adjusted gross and net leverage to increase to more than 2x
and 1x, respectively, by 2020, from a net cash prior to 2017, the
weakest leverage of its peer group.

KEY ASSUMPTIONS

  -- Revenue falling by around 3% in FY19, notably from lower
unit sales, before recovering to slightly positive in FY20 and by
mid- to high-single digits through to FY22

  -- Further deterioration of the EBIT margin to moderately
negative in FY19 and gradual recovery to less than 1% in FY20

  -- Capex maintained around GBP4 billion in FY19-FY20, declining
to around GBP3.5 billion in FY21-FY22

  -- Dividend payment cut back to GBP150 million from FY20

RATING SENSITIVITIES

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

  -- Further product diversification and an increase in scale
towards more than GBP30 billion revenue, combined with additional
positive track record in maintaining robust profitability and
financial structure

  -- Operating margin above 4%

  -- FCF margin sustainably above 0.5%

  -- FFO-adjusted net leverage remaining below 0.5x

  -- Refinancing of maturing bonds for a higher amount to
compensate for the expected negative FCF

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

  -- Increased evidence of a disorderly Brexit leading to costly
measures and consequences


  -- Further delay in reaching an inflexion point in the
operating and FCF margins trajectory

  -- Further deterioration in key credit metrics including FFO-
adjusted net leverage increasing to 1.5x

  -- Material weakening of JLR's liquidity position

  -- Problems with implementation of new product introduction and
production footprint expansion or decreasing market share

LIQUIDITY AND DEBT STRUCTURE

Healthy Liquidity: At end-September 2018, JLR reported cash and
cash equivalents of GBP1.8 billion, short-term liquidity deposits
of GBP0.8 billion and committed undrawn facilities of GBP1.9
billion maturing in 2022. Total reported debt at end-September
2018 was GBP4.4 billion, including GBP0.7 billion of short-term
maturities, before adjustments at end-FY18 of GBP0.7 billion for
operating leases and GBP0.5 billion for restricted cash and cash
deemed not fully available to account for intra-year working
capital volatility.

Recent Refinancing Steps: JLR issued a EUR500 million senior
unsecured bond in September 2018 and a fully drawn USD1 billion
senior unsecured syndicated loan in October 2018, maturing in
January 2025, with 20% amortising in October 2022. Fitch expects
further issuance in the next 12 months to compensate for expected
cash absorption as the company targets liquidity to remain in a
range of 12%-15% of revenue.

SUMMARY OF FINANCIAL STATEMENT ADJUSTMENTS

Fitch adds an 8x multiple of lease payments to debt, resulting in
a GBP0.7 billion debt adjustment in FY18.

Fitch treats GBP0.5 billion of cash (equivalent to 2.5% of sales)
as restricted for working capital and operating needs.

Fitch adjusts debt by GBP41 million to reflect the fair value of
debt.


JOHNSTON PRESS: Operations to Continue as Normal Following Buyout
-----------------------------------------------------------------
Matthew Garrahan at The Financial Times reports that the
newspaper publisher formerly known as Johnston Press has moved to
reassure employees and readers of its titles that its operations
will continue as normal following the sale of the business to its
creditors.

According to the FT, JPI Media, which owns titles including The
i, The Scotsman and Yorkshire Post, is preparing for life under
new ownership after a pre-pack administration with its creditors,
which include Goldentree Asset Management, Fidelity, Caravel
Asset Management and Benefits Street Partners.

The new owners are injecting GBP35 million of cash into the group
and have agreed to cut the level of senior secured debt by GBP135
million to GBP85 million, with extended debt maturity to December
2023, the FT discloses.

David King, Johnston Press chief executive, will stay on with the
new company, the FT states.  The sale to creditors "was the only
way to achieve continuity for all operations", he told staff in a
weekend email, adding that business would "continue
uninterrupted . . . so it is important to turn up for work as
normal".

In a letter to readers of the group's titles, Mr. King, as cited
by the FT, said the deal "safeguards your newspaper and website,
continues the employment of all our staff and helps us to have a
more stable and secure future".

Mr. King is due to speak to the new owners this week and a new
board will be formed, the FT relays, citing people briefed on the
plans.


LERNEN BONDCO: Moody's Assigns B3 CFR, Outlook Stable
-----------------------------------------------------
Moody's Investors Service has assigned a B3 Corporate Family
Rating and a B3-PD Probability of Default rating to Lernen Bondco
Plc, parent company of Cognita Holdings Limited, the K-12 private
education group. Concurrently, Moody's has assigned B2 instrument
ratings to the GBP200 million Term Loan B and to the euro
denominated GBP271 million equivalent TLB, both due 2025, and
GBP100 million Revolving Credit Facility due 2025, borrowed by
Lernen Bidco Limited. Moody's has also assigned a Caa2 instrument
rating to the euro denominated GBP225 million equivalent senior
unsecured Notes due 2026 issued by Lernen Bondco Plc. The outlook
on all ratings is stable.

The proceeds from the facilities have been used, together with c.
GBP1.4 billion equity contribution, to finance the acquisition of
the group by Jacobs Holding AG. Lernen Bondco Plc replaces
Cognita Bondco Parent Limited as the ultimate parent company for
the K-12 private education group.

As the transaction has already completed, Moody's is withdrawing
the B3 CFR and B3-PD of Cognita Bondco Parent Limited and the B3
instrument rating of the GBP435 million Senior Secured Notes
issued by Cognita Financing Plc.

The rating action reflects the following drivers:

  - Established player in the fragmented private-pay primary and
secondary education market, with a geographically diversified
portfolio of 71 schools in eight countries.

  - Exposure to changes in the political, legal and economic
environment in emerging markets, which represent 68% of group
EBITDA for the fiscal year 2018, ended August 31, 2018.

  - Lernen's leverage, as measured by Moody's-adjusted
debt/EBITDA, is high at 8.2x as of fiscal 2018, pro forma for the
completion of the transaction.

  - Moody's expectation that the group will reduce leverage in
the next 12-18 months driven by EBITDA growth and fee increases
above inflation in all countries.

RATINGS RATIONALE

The B3 Corporate Family Rating (CFR) reflects the following: (i)
solid position as a larger player in a fragmented market, with a
geographically diversified portfolio of 71 schools in eight
countries; (ii) established track record of achieving revenue and
EBITDA growth through organic and acquisitive student growth and
tuition fee increases above cost inflation; (iii) barriers to
entry through regulation, brand reputation and purpose-built real
estate portfolio; (iv) strong revenue visibility from committed
student enrolments.

Conversely, the rating is constrained by: (i) high Moody's
adjusted debt/EBITDA above 8.0x; (ii) aggressive debt-funded
acquisition and capacity expansion strategy and resulting lack of
deleveraging and free cash flow historically; (iii) concentration
risk as the top ten schools represent 65% of group EBITDAR; (iv)
reliance on its academic reputation and brand quality in a highly
regulated environment; (v) exposure to changes in the political,
legal and economic environment in emerging markets.

LIQUIDITY PROFILE

Moody's views Lernen's liquidity as adequate, supported by the
undrawn GBP100 million RCF. There will be sizeable cash balances
at closing (GBP 65 million), but Moody's understands that those
are held largely at local operations and in some cases not
readily available to management, although can be repatriated via
dividends. Although working capital is structurally negative at
year end, there is considerable quarter-on-quarter seasonality,
that may require the RCF to be drawn at times to sustain
liquidity.

There is a springing senior secured net leverage covenant set at
7.4x flat, tested if drawings under the RCF exceed 40%. Moody's
expects the group to have sizeable headroom under the covenant.

STRUCTURAL CONSIDERATIONS

The B2 rating on the GBP200 million and GBP271 million equivalent
senior secured TLBs and GBP100 million pari passu ranking RCF,
one notch above the CFR, reflect their priority ranking in the
event of security enforcement and their large share in the
capital structure. The euro denominated GBP225 million equivalent
senior unsecured notes are rated Caa2, two notches below the CFR,
reflecting their subordination behind the senior secured
instruments.

The security package provided to the first lien lenders is
relatively weak and limited to a pledge over shares, bank
accounts, and intercompany receivables, as well as guarantees
from operating companies (80% guarantor test) and a floating
charge provided by the English borrower.

RATING OUTLOOK

The stable rating outlook reflects Moody's expectation that the
group will continue to visibly grow EBITDA from both increased
student numbers and tuition fee growth. Moody's expects that the
group will pursue growth and acquisitions in a prudent manner and
benefit from an adequate liquidity profile.

FACTORS THAT COULD LEAD TO AN UPGRADE

Upgrade pressure on the ratings could arise if Moody's adjusted
debt/EBITDA declines below 7x and free cash flow generation is
positive on a sustainable basis, with adequate liquidity.

FACTORS THAT COULD LEAD TO A DOWNGRADE

Downward pressure on the ratings could arise if the group is not
able to grow EBITDA on a sustainable basis, resulting in leverage
increasing above current levels or negative free cash flow
generation during a sustained period of time, or liquidity
weakens. Any material negative impact from a change in any of the
group's schools regulatory approval status could also pressure
the ratings.

PRINCIPAL METHODOLOGY

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

CORPORATE PROFILE

Headquartered in the UK, Lernen Bondco Plc is an international
independent schools group offering primary and secondary private
education in 71 schools across eight countries in Europe, Asia
and Latin America. Founded in 2004, the group acquired schools in
the United Kingdom, Spain, Brazil, Chile, Singapore, Hong Kong
Thailand and Vietnam, and teaches around 40 thousand K-12
private-pay students. The group is owned by Jacobs Holding AG.


NEATH RFC: Loses "Number of Players" Due to Winding-Up Petition
---------------------------------------------------------------
BBC Sport reports that Neath has confirmed a "number of players"
have left because the club faces a winding-up petition in court.

A hearing to decide the club's future will be held at Port Talbot
Justice centre on Nov. 26, BBC Sport discloses.

According to BBC Sport, former Neath and Wales full-back Paul
Thorburn said the club had become a "victim of professionalism"
and fears others could follow suit.

Neath's general manager Gareth Howells confirmed players had left
due to the current situation and "its impact on their contracts",
BBC Sport relates.

Neath RFC, which trades as Neath Rugby Limited, is facing a
winding-up petition after the collapse of the club's owner
Mike Cuddy's construction business Cuddy Group which went into
administration in July this year, BBC Sport discloses.

This is not the first time the club has had issues with its
finances, BBC Sport notes.

In 2012, the club fought off a winding-up order from Her
Majesty's Revenue and Customs (HMRC) over unpaid tax after
settling the debt, BBC Sport recounts.



                            *********

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

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
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historical cost net of depreciation may understate the true value
of a firm's assets.  A company may establish reserves on its
balance sheet for liabilities that may never materialize.  The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

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


                            *********


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

Troubled Company Reporter-Europe is a daily newsletter co-
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Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
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