/raid1/www/Hosts/bankrupt/TCREUR_Public/190704.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

          Thursday, July 4, 2019, Vol. 20, No. 133

                           Headlines



B E L A R U S

BELARUS DEVELOPMENT BANK: S&P Affirms 'B/B' Issuer Credit Ratings
BELARUS: Fitch Affirms 'B' Issuer Default Ratings, Outlook Stable


C Y P R U S

QIWI PLC: S&P Affirms BB-/B Issuer Credit Ratings, Outlook Stable


F R A N C E

ALTRAN TECHNOLOGIES: S&P Places 'BB' ICR on CreditWatch Positive
FINANCIERE HOLDING: Moody's Lowers CFR to B2, Outlook Stable
LA FINANCIERE ATALIAN: Moody's Lowers CFR to B3, Outlook Stable
NEW LOOK: French Unit Put Into Liquidation by Paris Court


H U N G A R Y

OTP BANK: Moody's Reviews Ba1 Deposit Rating for Upgrade


I C E L A N D

ICELAND TOPCO: Fitch Gives B Issuer Default Rating, Outlook Stable


I R E L A N D

PENTA CLO 6: Moody's Assigns (P)B3 Rating on EUR10MM Cl. F Notes
PENTA CLO VI: Fitch Assigns B-(EXP)sf Rating on Class F Debt
PROVIDUS CLO III: Moody's Gives (P)B3 Rating to EUR10MM Cl. F Notes
WEATHERFORD INT'L: S&P Lowers ICR to 'D' on Chap. 11 Filing


I T A L Y

ALITALIA SPA: Toto Group Plans to Invest in Business
CORDUSIO RMBS: S&P Affirms B- Rating on Class E Notes


K A Z A K H S T A N

AGRARIAN CREDIT: Moody's Assigns Ba1 Issuer Ratings, Outlook Stable
DAMU ENTREPRENEURSHIP: S&P Affirms 'BB+/B' ICRs, Outlook Stable
DEVELOPMENT BANK OF KAZAKHSTAN: S&P Affirms 'B+/B' ICRs
EURASIAN RESOURCES: S&P Alters Outlook to Stable & Affirms B ICRs
FREEDOM FINANCE: S&P Assigns 'B-/B' Issuer Credit Ratings

SAMRUK-KAZYNA: S&P Affirms 'BB+/B' Issuer Credit Ratings


L U X E M B O U R G

ABLV BANK: Agrees to Commence Judicial Liquidation Process
AI AQUA: S&P Affirms 'B' Issuer Credit Rating, Outlook Negative
AURIS LUXEMBOURG II: Fitch Assigns B LongTerm IDR, Outlook Stable


N E T H E R L A N D S

ALGECO INVESTMENTS: Moody's Affirms B2 CFR, Outlook Stable


R U S S I A

PETERSBURG SOCIAL: Moody's Affirms B2 Deposit Ratings
SAFMAR FINANCIAL: S&P Hikes Longterm Rating to 'BB-'


S L O V E N I A

NOVA KREDITNA: Fitch Revises Outlook on BB+ LT IDR to Positive


S P A I N

BANKINTER 11: S&P Affirms B- Rating on Class D Notes
LECTA SA: S&P Cuts LongTerm Ratings to B- on Liquidity Concerns
TDA IBERCAJA 4: S&P Affirms D Rating on Class F Notes


T U R K E Y

DOGUS HOLDING: S&P Lowers LongTerm Rating to CCC+ on Weak Liquidity


U N I T E D   K I N G D O M

CANTERBURY FINANCE 1: Moody's Give (P)B2(sf) Rating to Cl. C Notes
CIFC EUROPEAN I: Moody's Gives (P)B2 Rating to EUR12MM Class F Debt
CO-OPERATIVE BANK: Moody's Ups Deposit Ratings to B3, Outlook Pos.
DEUTSCHE BAHN: Auditors Raise Going Concern Doubt Amid Arriva Sale
ENSCO ROWAN: S&P Affirms 'B-' ICR on Below-Par Cash Tender Offer

HIKMA PHARMACEUTICALS: S&P Alters Outlook to Pos & Affirms BB+ ICR
MONSOON ACCESSORIZE: Creditors Back Company Voluntary Arrangement
PARAGON CREATIVE: Appoints Administrators From KPMG
PMC SOIL: Trading Difficulties Prompt Administration
RDLZ REALISATION: August 2 Claims Filing Deadline Set

SHINE HOLDCO III: Moody's Lowers CFR to B3, Outlook Stable
SMARTFOCUS HOLDINGS: Appoints Administrators from BDO LLP
TVL FINANCE: S&P Rates New GBP440MM Secured Notes Due 2025 'B-'

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BELARUS DEVELOPMENT BANK: S&P Affirms 'B/B' Issuer Credit Ratings
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S&P Global Ratings affirmed its 'B/B' long- and short-term foreign
and local currency issuer credit ratings on Development Bank of the
Republic of Belarus JSC (DBRB). The outlook is stable.

S&P equalizes its ratings on DBRB with those on Belarus because, in
its view, there is an almost certain likelihood that Belarus'
government would provide DBRB with timely and extraordinary support
sufficient to service the bank's financial obligations, if needed.
S&P based its assessment of the likelihood of extraordinary support
on its view of DBRB's:

-- Integral link with the Belarus government, demonstrated by the
state's 100% ultimate ownership, capital injections provided in the
past, and the government's promise to pay the bank's bonds in
certain cases where the institution does not itself have the
resources to do so. Key government figures, including the prime
minister, are members of DBRB's supervisory board and S&P
understands that the bank regularly reports on its financial
standing to the Ministry of Finance. The state therefore continues
to maintain close oversight of the bank's activities. S&P does not
currently expect these arrangements to change; and

-- Critical public policy role as the main institution providing
long-term loans under the Belarusian government's direction, and a
tool to fulfil several other policy functions. As of year-end 2018,
DBRB's total assets were equivalent to 6.5% of GDP and constituted
10.5% of the banking system's assets. DBRB remains a key agent in
the implementation of certain projects and programs that the
government considers important for the country.

Although S&P currently views the government's capacity to support
government-related entities (GREs) as doubtful, it believes that
DBRB's importance in achieving several political and social
objectives would lead the government to prioritize support to DBRB
ahead of other GREs in Belarus.

In April-May 2019 DBRB has for the first time issued Eurobonds in
two tranches: a U.S.dollar-denominated 500 million five-year bond
and a Belarusian ruble (BYN)-denominated 210 million three-year
bond. S&P understands that issuance proceeds will be used to fund
development projects, refinance debt coming due as well as for
other general corporate purposes.

Mandate and activities: a development institution operating under
government's direction

DBRB was established in 2011, following the International Monetary
Fund's recommendation on reforming Belarus' banking sector, which
had been heavily involved in directed, subsidized lending under
vaguely defined government programs. The bank's initial objective
was to centralize lending under such programs, thereby allowing
state-owned commercial banks to function on market terms. S&P
believes this goal has been only partially achieved, given that
some government-led lending remains with other state-owned banks
operating in Belarus, including Belarusbank and Belagroprombank.

DBRB's mandate has since broadened, and currently includes:

-- Financing capital-intensive long-term investments and important
social projects;

-- Acting as an export bank, supporting Belarusian producers
focused on overseas markets;

-- Managing certain assets of the wood-processing sector on behalf
of Ministry of Finance to improve recovery of corresponding
budgetary loans to the enterprises in the sector;

-- Supporting development and extending investment credit to small
and midsize enterprises (SMEs); and

-- Serving as an agent of the government for managing so-called
"family capital," that is, cashless lump sums introduced in late
2014 to families with three children or more, which have to be
managed for 18 years to maintain a minimum yield before they can be
spent on housing or education.

At present, DBRB's management and the government are finalizing
work to clarify DBRB's mandate. S&P said, "We do not expect any
substantial changes and anticipate that some of the activities that
the bank has already undertaken under the direction of the
government in recent years, such as managing the "family capital",
will be more formally codified. We also understand that DBRB could
in the future act as a filter for appraising various potential
investment projects in Belarus (not only those that DBRB would
directly implement by itself), leveraging the bank's expertise."

Nevertheless, the backbone of DBRB's strategy will remain the
financing of large investment projects, Belarus' exports, and SMEs.
The relative importance of export and SME funding is likely to
increase given that many government-driven infrastructure projects
are already finalized or nearing completion. These include
construction of a second runway at Minsk airport , constructing
various roads in Belarus, and financing the purchase of new
aircraft for the national airline Belavia.

Ownership structure: DBRB will remain fully state-owned

Since its establishment, the bank has been ultimately 100%
government owned. At present, the government directly controls
96.2% of DBRB through the Council of Ministers, while Belaruskali
(national 100% state-owned potash fertilizer company) holds just
less than a 3.8% stake, and the central bank 0.01%. There are plans
for the central bank to imminently exit its small stake in the
bank's capital, but we don't expect any operational changes as a
result. We anticipate that DBRB will remain fully state-owned.

Historically, as a development institution, DBRB was not subject to
the same prudential regulatory requirements as commercial banks.
S&P said, "However, we note that the supervisory and regulatory
requirements for DBRB were tightened in 2016, and many of the
requirements applicable to commercial banks also now apply to DBRB.
We don't view this as a weakening of DBRB's role or status, but
rather as a sign of the state's desire to standardize regulation
and bring reporting and governance standards at DBRB in line with
those in the wider banking sector."

Government support: capital injections provided in the past coupled
with existence of support framework

In the past, the government of Belarus made several equity
injections into DBRB. It did so every year in 2012-2015 and, in
2016, the bank's capital increased through retained profit.
Although no capital increase was initially foreseen in 2018, the
government made an equity injection of BYN245 million (about $120
million) in order to support activities in the leasing segment and
prevent the institution's capital ratio from weakening.

At present, there are no plans to further capitalize the
institution. That said, S&P understands that the government is
potentially considering introducing a five-year moratorium on bank
dividend payments.

S&P views the government's promise to pay on DBRB's bond-type debt
in certain circumstances if the bank itself does not have enough
resources to do so as positive. The relevant mechanism, known as
secondary liability, was described in a Presidential decree adopted
in 2014. The mechanism and conditions of the secondary liability
have recently been further clarified in the bond documentation for
the two Eurobonds DBRB issued in Spring 2019.

Importantly, the secondary liability does not constitute a full
guarantee of payment on DBRB's debt for several reasons:

-- It does not necessarily ensure timeliness of payment by the
government of Belarus on DBRB bonds in the event of bank's
financial distress;

-- It can be amended or withdrawn through a presidential edict;

-- The government of Belarus' obligations in respect to the
secondary liability rank lower than Belarus' senior unsecured
debt;

-- It applies only under Belarusian rather than international
law;

-- It covers only the bond-type debt, excluding other types of
financial obligations of DBRB, for example loans.

Nevertheless, S&P believes the secondary liability mechanism
provides further incentives for the authorities to extend timely
and sufficient extraordinary financial support in a hypothetical
stress scenario.

Stand-alone credit profile: unchanged at 'b'

S&P is affirming its assessment of DBRB's stand-alone credit
profile (SACP) at 'b'. The SACP is an indication of the
institution's creditworthiness without taking into account the
potential for extraordinary government support.

After a loan portfolio clean up in 2017, when about 11% of the loan
book was written-off, the bank's asset quality indicators improved
to a level now comparable with those of its domestic peers. Problem
loans (measured as Stage 3 plus purchased and originated
credit-impaired loans defined under International Financial
Reporting Standards) accounted for 6.7% of DBRB's gross loan
portfolio, versus a weighted average of 11% for Belarus' banking
system at end-2018. Loans more than 90 days overdue stood at 3.2%
of the gross loan book on the same date, down from 4.6% on Dec. 31,
2017 (the end-2017 figure reflects NPLs 90+ and restructured
loans). S&P said, "Our base case scenario forecasts stable asset
quality over the next two years on the back of the economy's slow
recovery and key corporate borrowers' stabilized economic
performance. However, given DBRB's mandate as a development
institution, we think that the bank is more vulnerable to potential
credit risks because it is concentrated on the construction and
agriculture industries (about 42% of its gross loan book is
attributed to these two sectors), and is involved in relatively
riskier projects in terms of duration, size, and recovery
prospects. Therefore, we consider the current provisioning cushion
of about 7.6% of total loans as of end-2018 not excessive, but in
line with the sector average. We also note the bank manages bad
assets on behalf of the government, although these assets are not
included on its balance sheet, and the institution acts more like a
consultant mandated to maximize recoveries." The share of loans
denominated in foreign currency is a moderate 46% of total loans
and lower than the sector average of 50%.

S&P believes that the bank is adequately capitalized and is in
compliance with all prudential ratios applied by the National Bank
of the Republic Of Belarus (NBRB or the central bank). As of May 1,
2019, its regulatory capital adequacy ratio stood at 23%,
representing a buffer compared with the 10.0% minimum
requirements.

The bank's customer franchise is weak. By law, it cannot accept
deposits from individuals or corporations, except in cases when
entities that participate in state programs deposit funds used for
loan repayments. S&P said, "However, in our view, the bank has very
good access to long-term state-related funding. As of end-2018,
almost 21% of total liabilities were bonds held by the NBRB
maturing in 2023-2051. We view these liabilities as resilient to a
loss of confidence in the market and a key funding strength. State
authorities' deposits constitute another 12% of DBRB's liabilities.
About 40% of liabilities are represented by term placements of the
banks, largely Belarusian ones. We note that in Spring 2019, DBRB
issued two Eurobonds--one denominated in U.S. dollars, the other in
Belarusian rubles; the latter benchmark also helps form a market
indicator for long-term funding in Belarusian rubles."

The bank's adequate liquidity continues to be supported by
sufficient liquid assets (cash and cash equivalents plus investment
securities) representing about 30% of DBRB's total assets or 42% of
total liabilities. S&P considers that the bank's stable funding
ratio of 107.7% as of year-end 2018 is sustainable in the long
term.

The stable outlook on DBRB reflects balanced risks to the ratings
over the next 12 months. It also mirrors the outlook on Belarus.

S&P said, "We could raise our ratings on DBRB if we took a positive
rating action on Belarus, provided that DBRB's integral link with
and critical role for the government remained unchanged.

"We could lower our ratings on DBRB following a negative rating
action on the sovereign. Even if the sovereign rating is unchanged,
we could take a negative action on DBRB if its link with, or role
for the government weakened over the next 12 months and its SACP
deteriorated at the same time." This could be the case, for
example, if the institution's capitalization levels declined
alongside a weakening mandate or government's diminished commitment
to provide support.


BELARUS: Fitch Affirms 'B' Issuer Default Ratings, Outlook Stable
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Fitch Ratings has affirmed Belarus's Long-Term Foreign- and
Local-Currency Issuer Default Ratings at 'B'. The Outlook is
Stable.

KEY RATING DRIVERS

Belarus's ratings balance improving macroeconomic stability, a
strong structural profile in terms of income per capita and human
development indicators, and a clean debt repayment record against
low foreign exchange reserves, relatively subdued growth prospects,
government debt highly exposed to foreign currency risks, a weak
banking sector, high external indebtedness and weak governance
indicators relative to rating peers. Despite progress towards
diversification, Belarus remains closely linked to Russia in terms
of trade, investment and external financing.

Belarus and Russia continue to negotiate a potential compensation
mechanism for the implementation of Russia's oil tax manoeuvre.
This takes place in the context of a broader discussion regarding
greater economic integration under the 1999 Union Agreement. While
the discussion tone has improved and recent statements by high
level officials point to progress, the timing for reaching a final
agreement remains uncertain.

In the event of no compensation, total direct costs could rise to
USD10.6 billion between 2019 and 2024, if oil prices average USD70
and Belarus's refineries increase the volume of oil processed from
18 million tonnes in 2019 to 24 million tonnes in 2020-2024.
Authorities have already incorporated no compensation in 2019-2020
fiscal, financing and monetary policy programming, and the
economy's capacity to adjust to higher energy import costs in the
medium term, potentially through lower growth and weaker exchange
rate, would depend on the availability of alternative sources of
external financing and the speed of transformation of the refining
industry and other sectors dependent on reduced energy prices.

In the near term, Belarus's policy framework improved consistency
and credibility, reduced external imbalances and higher government
cash buffers provide the space to accommodate the delay in loan
disbursements and reduce the impact of uncertainty on macroeconomic
stability.

Monetary policy remains focused on maintaining improved
macroeconomic stability and is supported by increased FX
flexibility and prudent fiscal policy. The monetary authority has
kept its policy rate at 10% since mid-2018 (close to neutral
level). Further easing is unlikely given recent inflation readings
and external risks derived from the uncertainty regarding of
Russia's oil tax manoeuvre. Fitch expects full-year average
inflation at 5.8% in 2019 and 6.0% in 2020, above the forecast 4.6%
and 4.9% 'B' median. Real wage growth has slowed to 7.8% yoy in
1Q19 down from 13.5% in 1Q18, but remains above that of
productivity.

International reserves rose to USD8.1 billion in May, the highest
level since April 2013 and almost USD1 billion since end-2018
driven by continued NBRB FX purchases by the National Bank of the
Republic of Belarus (NBRB) in the local market. Net reserves
continue to improve, rising to USD4.1 billion in April. Fitch
forecast end-2019 reserves at USD7.7 billion, thus remaining stable
in terms of CXP coverage (1.9 months) but still low compared with
'B' peers (3.5 months). External liquidity remains among the
weakest in the 'B' category.

Belarus will maintain moderate external imbalances. Fitch expect
the current account deficit to widen to 2.4% of GDP in 2019 and
3.8% of GDP in 2020, from a record low of 0.4% of GDP in 2018,
reflecting slower export growth, the construction of the nuclear
power plant (NPP) (accounting for an average of 1.3pp of GDP impact
in both years) and higher energy prices. Fitch forecast FDI to
remain broadly stable at 2.3% of GDP in 2019-2020, financing the
majority of the CAD. The Development Bank of Belarus issued both
foreign currency (USD500 million) and local currency (BYN210
million) Eurobonds and further non-sovereign issuance in 2019-2020
is possible.

Belarus has accommodated delays in disbursements from Russia and
the Eurasian Fund for Stabilization and Development (EFSD) through
financing from China, increased issuance in the local market and
continued use of a share of foreign currency budget revenues in
order to meet USD3.1 billion foreign currency 2019 debt service, of
which 46% was paid in 1H19. For 2020, Belarus will service its debt
(USD3.5 billion) through USD1.4 billion in foreign currency budget
revenues, local market issuances and a return to the Eurobond
market. If Russia disburses the USD600 million loan in 2019, it
will be used for 2020 pre-financing. The local market can also
provide some room for additional foreign currency financing, as the
sovereign made net debt repayments in 2017-2018. Belarus maintains
a robust cash position (USD4.6 billion at the beginning of May) to
cover short-term financing delays.

Fitch's adjusted general government (GG) budget (including NPP
investment and off-budget spending) reached a surplus of 1.6% of
GDP in 2018 due to lower capital expenditure on the NPP, strong
revenue growth and lower spending execution. The officially
reported consolidated surplus (state budget plus SPF) rose to a
record 4% of GDP. The government conservative budget planning does
not include compensation for the oil tax manoeuvre in 2019-2020.
Fitch's estimate for adjusted general government deficit will equal
3.1% of GDP in 2019 reflecting increase in NPP-related capex (3.5%
of GDP), slower revenue growth, improved execution of social
spending and potential increase in off-budget outlays to 1.4% of
GDP.

GG debt (including guarantees accounting for 7% of GDP) dropped to
47% of GDP in 2018, down from 52.2% in 2017 and well below the
current 57% 'B' median, reflecting reduction in guarantees, debt
prepayments, high nominal GDP growth and lower than anticipated
disbursements (EFSD). While government debt is projected to remain
lower peers, currency risk remains high as 91.5% of public debt is
foreign currency denominated. Weaker macroeconomic performance and
exchange volatility could create fiscal risks for public finances
due to the large presence of SOEs in the economy.

In the absence of external tailwinds, Fitch expects the Belarussian
economy to slow to 2% in 2019 and 1.8% in 2020, below Fitch's
forecasts of 3.2% and 3.4% for the 'B' median, reflecting weaker
growth in trading partners and slower household consumption in line
with moderation of real wage growth and the expected continuation
of conservative monetary and fiscal policy.

The financial sector remains vulnerable to weaker growth and
exchange rate volatility. Despite gradual progress, financial
dollarisation remains high at 65.5% and 49% for deposits and loans,
respectively, in May 2019. According to official figures, NPLs (6%
in March) are low compared with regional peers, but have increased
over the past year (3.7% in June 2018) despite broadly favourable
macroeconomic conditions. Fitch considers that asset quality is
likely to be considerably weaker when assessed in terms of IFRS
impaired loans.

Political power is concentrated in the hands of President
Lukashenko, who has been in power since 1994, and Fitch assumes
that he will remain in power over the medium term. Parliamentary
elections are scheduled for November 17, 2019, while presidential
elections will take place no later than August 2020. Fitch does
neither anticipate a change in economic policy direction nor a
change in the gradual approach to SOE and utilities reform.

SOVEREIGN RATING MODEL (SRM) and QUALITATIVE OVERLAY (QO)

Fitch's proprietary SRM assigns Belarus a score equivalent to a
rating of 'BB-' on the Long-Term FC IDR scale.

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

  - Macro: -1 notch, to reflect weaker medium-term growth prospects
relative to rating peers due to adverse demographic dynamics and a
large public sector facing productivity, high leverage and
efficiency challenges

  - External finances: -1 notch, to reflect a high gross external
financing requirement, low net international reserves, and reliance
on often ad hoc external financial support from Russia to meet
external obligations, which is vulnerable to changes in bilateral
relations. Belarus's net external debt/GDP is high

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

RATING SENSITIVITIES

The following factors may, individually or collectively, result in
positive rating action:

  - Sustained increase in international reserves supported by
further progress in diversification in external financing sources.

  - Fiscal consolidation at the broader general government level,
leading to a reduction in public debt/GDP and/or contingent
liabilities.

  - Sustained improvement in Belarus's medium-term growth
performance in the context of macroeconomic stability, for example
stemming from implementation of structural reforms.

The following factors may, individually or collectively, result in
negative rating action:

  - Re-emergence of external financing pressures and erosion of
international reserves.

  - Increased macroeconomic instability, for example due to
weakening in the coherence or credibility of economic policy.

  - Deterioration in public finances resulting in a significant
rise in government debt or contingent liabilities.

KEY ASSUMPTIONS

  - Fitch's assumes that Belarus will receive economic and
financial support from Russia and that there is no major breakdown
in the bilateral relationship notwithstanding periodic disputes.

Fitch assumes that the Russian economy will grow 1.2% in 2019 and
1.9% in 2020.

The full list of rating actions is as follows:

  Long-Term Foreign-Currency IDR affirmed at 'B'; Outlook Stable

  Long-Term Local-Currency IDR affirmed at 'B'; Outlook Stable

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

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

  Country Ceiling affirmed at 'B'

  Issue ratings on long-term senior-unsecured foreign-currency
  bonds affirmed at 'B'




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QIWI PLC: S&P Affirms BB-/B Issuer Credit Ratings, Outlook Stable
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S&P Global Ratings affirmed its 'BB-/B' long- and short-term issuer
credit ratings on Cyprus-based QIWI PLC, the holding company of the
QIWI payment and financial services group. The outlook is stable.

QIWI PLC's core segment, Payment Services, continues to perform
strongly and S&P expects that the group's leverage will remain very
low over the next two years.

Net revenues for the three months ended March 31, 2019, increased
31% to Russian ruble (RUB)5.4 billion (about $82.9 million)
compared with the same period last year. This was driven by strong
growth in transaction payment volumes and yields in e-commerce and
digital money remittances market verticals (including peer-to-peer
payments). S&P assumes the group will be able to maintain its
revenue growth at about 14%-16% in 2019 (considering the effect of
deconsolidation of the Tochka project) and about 20%-25% in
2020-2021, benefiting from an increasing demand for noncash
payments in Russia and across the Commonwealth of Independent
States (CIS), as well as the entrance into new segments and niches,
such as the fast-growing betting industry, the sharing economy, and
the self-employed sector.

S&P's assessment of the group's business risk profile is affected
by current regulatory risks related to QIWI Bank and evolving
legislative initiatives related to regulation in betting,
e-commerce, peer-to-peer money transfers, and the self-employed
sector.

There is no significant debt outstanding at QIWI PLC at this time.
S&P said, "However, we expect that the group will use up to 20% of
the customer deposits at QIWI Bank from Rocketbank's and Tochka's
clients for financing its lending activity within Sovest payment by
installment cards until the Sovest project is transferred to
multi-banking platform. We consider such funding as quasi-debt but
expect that the group's debt-to-EBITDA ratio will be remaining low
in 2019-2020 and thereby not affecting our current assessment of
its financial risk profile."

S&P said, "At the same time, we understand that if the group is not
able to realize its strategy of transforming Sovest from QIWI Bank
into a broker-like, multi-banking model, or (in case of further
delay or more aggressive growth) the project will likely require
additional funding in form of external debt or deposits. That, in
turn, might lead to volatility in its ratios, given that the target
debt level is not constrained by the QIWI group's current financial
policy. That said, we do not expect the holding company to issue
debt, but rather for leverage to most likely accumulate at QIWI
Bank.

"In our view, the QIWI group bears higher risks of volatility to
its earnings than its peers. We compare the group with a wide range
of companies, including online payment systems (i.e. PayPal
Holdings), money transfers and processing companies (i.e. Credit
Union Payment Center, Western Union Company, and MoneyGram
International), payment servicers (i.e. Wex Inc.), and technology
companies (Paysafe).

"The QIWI group is exposed to credit risks associated with its
Sovest project--a risk its peers do not share. We note that, unlike
some of its peers, main operating subsidiary QIWI PLC is subject to
the Central Bank of Russia's regulations. While QIWI Bank's tier 1
capital ratio was a comfortable 25.12% as of May 1, 2019, we do not
exclude a scenario where the regulator could theoretically restrict
dividends or other cash flows from the bank to the holding
company.

"The stable outlook reflects our opinion that the QIWI group should
be able to maintain its competitive position and resilient
financial risk profile in the next 12-18 months, despite increasing
competition and still-challenging operating conditions in the
region.

"We could consider taking a negative rating action over the next
12-18 months if, contrary to our expectations, QIWI's operating
conditions lead to a material decline in revenues and its
profitability weakens substantially, or if the regulatory
environment changes in an unfavorable way. We could also lower the
rating in the unlikely event that QIWI raised a substantial amount
of debt or accumulated debt at the operating company level, such
that its debt to EBITDA exceeded 2x.

"We do not currently view a positive rating action as likely, given
QIWI's high business concentration in Russia and across the CIS,
increasing competition, and existing regulatory risks. However, we
could raise the rating if the group successfully transforms Sovest
to a multi-banking model, thus reducing risks of increasing
leverage, and its fulfills and sustains its financial policy of
maintaining low to minimal debt."




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

ALTRAN TECHNOLOGIES: S&P Places 'BB' ICR on CreditWatch Positive
----------------------------------------------------------------
S&P Global Ratings placed its 'BB' ratings on Altran Technologies
S.A.and its senior secured debt on CreditWatch with positive
implications.

Capgemini SE (BBB+/Watch Neg/--) intends to acquire engineering,
research, and development services provider Altran through an
all-cash offer at a price of EUR14.00 per share. The total cash
consideration will amount to EUR3.6 billion, before taking Altran's
net financial debt of EUR1.4 billion into account. As part of the
transaction, Altran's outstanding senior secured debt will be
repaid, in accordance with the change-of-control clause in Altran's
senior facility agreement.

The boards of directors of both companies have approved the
agreement, setting out key terms and conditions of the proposed
transaction. However, it remains subject to a consultation phase
with the companies' respective work councils, and customary
regulatory approvals, including from antitrust authorities.

S&P said, "We expect Altran's credit quality to improve after the
transaction, given that it will be part of the much bigger, more
diversified, and cash generative Capgemini. In our view, Altran
will also benefit from Capgemini's more prudent balance-sheet
position, even after incorporating the debt-financed acquisition.
We believe Altran's size and importance to Capgemini's long-term
strategy means it will likely represent a strategic asset that will
be integrated into the group, with all existing debt likely
refinanced by Capgemini."

CreditWatch

S&P said, "We expect to resolve the CreditWatch following
completion of the transaction, which will likely occur by year-end
2019 or early 2020.

"We are likely to raise our ratings on Altran by several notches,
potentially up to the rating on Capgemini, after we assess Altran's
stand-alone creditworthiness following the transaction, its
strategic importance to Capgemini, and level of integration into
the group."


FINANCIERE HOLDING: Moody's Lowers CFR to B2, Outlook Stable
------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating of
Financiere Holding CEP to B2 from B1. At the same time, Moody's has
affirmed the B1 rating of the senior secured first lien term loan
issued by CEP and the B1 rating of the revolving credit facility
issued by Financiere CEP, and has downgraded the rating of the
senior secured second lien term loan issued by CEP to Caa1 from B3.
The outlooks on the issuers have been changed to stable from
negative.

RATINGS RATIONALE

The downgrade of CEP's CFR and of the senior secured second lien
term loan rating reflects the slower than anticipated deleveraging
of the group. Moody's adjusted Debt-over-EBITDA (leverage) ratio
stands at 7.7x at year end 2018, which is high for CEP's rating
category. Albeit the rating agency expects the ratio to decline
below 7x by year end 2019 and below 6.5x in 2020, these remain
above the level expected previously and are more consistent with a
B2 CFR.

CEP's adjusted EBITDA decreased to €96 million in 2018 (by 9% vs
2017) following a decrease in mortgage loans refinancing in the
French market which affected the revenues and the profits of the
group's credit brokerage segment. In addition, growth in the loan
insurance segment was slower than anticipated, in particular
outside of France. Moody's expects CEP's EBITDA to grow in 2019,
which will reduce the group's leverage.

In addition, CEP did not generate a level of cash which has been
sufficient to trigger the cash sweep mechanism, hence delaying the
debt repayment.

CEP's credit profile continues to be supported by a high level of
profitability (with an EBITDA margin of 42% in 2018), a leading
position in the French loan insurance market and growing position
in the credit brokerage market as well as a strong resilience of
revenue streams and cash flows given the long-term nature of CEP's
business. CEP also benefits from a growing diversification.

The affirmation of the senior secured first lien term loan rating
vis-à-vis the senior secured second lien term loan reflects the
subordination of the second lien debt over the first lien debt.

Outlook

The outlook of Financiere Holding CEP (France) is stable and
reflects Moody's expectation that CEP will maintain solid
profitability and will reduce financial leverage below 6.5x through
EBITDA growth over the next 18 months.

Rating drivers

Positive pressure on CEP's ratings could result in case of a
decrease in leverage as evidenced by an adjusted debt-to-EBITDA
ratio below 5.5x, or of material increase in CEP group's
diversification, geographically or by business line, without a
material reduction of the EBITDA margin.

Conversely, negative pressure on CEP's ratings could arise if the
adjusted debt-to-EBITDA were to remain consistently above
6.5x,and/or if the EBITDA margin were to fall below 30%.

LIST OF AFFECTED RATINGS

Issuer: Financiere CEP (France)

Affirmations:

Backed Senior Secured EUR40M Revolving Credit Facility, affirmed
B1

Backed Senior Secured EUR 469.6M First Lien Term Loan, affirmed B1

Outlook Action:

Outlook changed to Stable from Negative

Issuer: Financiere Holding CEP (France)

Downgrades:

Long-term Corporate Family Rating, downgraded to B2 from B1

Probability of Default Rating, downgraded to B2-PD from B1-PD

Backed Senior Secured EUR120M Second Lien Term Loan, downgraded to
Caa1 from B3

Affirmation:

Backed Senior Secured EUR120.4 First Lien Term Loan, affirmed B1

Outlook Action:

Outlook changed to Stable from Negative


LA FINANCIERE ATALIAN: Moody's Lowers CFR to B3, Outlook Stable
---------------------------------------------------------------
Moody's Investors Service downgraded to B3 from B2 the corporate
family rating and to B3-PD from B2-PD the probability of default
rating of La Financiere ATALIAN S.A.S., a leading provider of
cleaning and facility management services based in France.
Concurrently, Moody's has also downgraded to Caa1 from B3 the
instrument rating on the EUR625 million senior unsecured notes due
2024, the EUR350 million senior unsecured notes due 2025, and the
GBP225 million senior unsecured notes due 2025, all issued by La
Financiere ATALIAN S.A.S. The outlook remains negative.

The rating action follows the release of the company's results for
the fiscal year 2018 and the first quarter of its fiscal year 2019,
which were weaker than the rating agency's initial expectations.

RATINGS RATIONALE

"Moody's downgraded Atalian's CFR to B3 from B2 because of the
continued weakening of the company's credit metrics in Q4 2018 and
Q1 2019 due to declining EBITDA in France and other international
markets excluding Servest", says Eric Kang, Moody's lead analyst
for Atalian. "The new strategic plan appears sensible but the
timing of any visible improvement in operating performance and
credit metrics remains unclear at this stage. Moreover, a continued
deterioration in operating performance in the coming quarters could
pressure the company's liquidity which is still adequate but has
weakened in recent quarters.", adds Mr Kang.

The Moody's-adjusted debt/EBITDA was 8.5x as of December 2018
(excluding CICE factoring, including the impact of IFRS 16, and pro
forma for the full-year contribution of Servest and other
acquisitions completed in 2018) compared to the rating agency's
initial expectations of 7.1x. The deviation mainly stems from the
lack of recovery in the French business due to the restructuring of
the security business and large contract renewals, as well as weak
trading in the international operations excluding Servest in recent
quarters due to the closure of part of the Hungarian business and
the economic environment in Turkey.

Moody's concurs with the new management's diagnosis of the issues
which led to the recent operating and financial underperformance
notably a lack of focus on the day-to-day operations, and the
material releveraging impact of the Servest acquisition. In Moody's
view, the new strategic plan is sensible but limited details have
been made available to date and it also entails significant
execution risks. The new plan aims to reduce the company's reported
net leverage to 4.5x by 2021 from 5.9x in 2018 through the
following levers: (i) an improvement in earnings and cash flow
generation, (ii) EUR100 million to EUR200 million of proceeds from
the disposal of non-core assets in the next 18 months, and (iii) a
capital increase to be concluded and implemented within the next
two years.

LIQUIDITY

Moody's considers that Atalian has an adequate liquidity position,
albeit it has weakened in the last couple of quarters. Moody's
expects annual free cash flow to be muted in the next 12-18 months
but liquidity is supported by, as of March 2019, cash balances of
EUR92 million and EUR53 million and EUR43 million available under
the revolving credit facility (RCF) and factoring lines
respectively. Moody's also expects the company to maintain under
the net senior secured leverage attached to the RCF and set at
1.75x. Lastly, the debt maturity profile benefits from the absence
of material debt maturities before the renewal of the factoring
lines and the RCF in 2021 and 2023 respectively.

STRUCTURAL CONSIDERATIONS

The senior notes due 2024 and 2025 rank pari passu. The notes are
unsecured and guaranteed on a senior basis by Atalian S.A.S.U.,
Atalian Europe S.A., and Atalian Global Services UK 2 Limited
although obligations of certain guarantors are contractually
limited -- these subsidiaries of La Financiere Atalian S.A.S. are
holding companies that do not generate any significant revenues.
The RCF benefits from guarantees from the same entities and Atalian
Cleaning S.A.S. which also guarantees the senior notes due 2024 but
with limitations.

The notes are rated Caa1, one notch below the CFR, reflecting their
structural subordination to non-debt liabilities at the operating
subsidiaries, including trade payables. Additionally, the RCF has
priority claim over the notes over certain intermediary holding
companies of Atalian, namely Atalian Cleaning S.A.S., Atalian
Proprete S.A.S., Atalian Europe S.A., Atalian Global Services UK 2
Limited, and Servest Limited, thanks to the pledge over the share
of these entities.

OTHER CONSIDERATIONS

The appointment of the company's sole owner and chairman as chief
executive is negative from a corporate governance perspective but
this is partly offset by the material improvements in board
oversight as reflected among other things by the appointment of
three new independent directors with strong credentials.

RATING OUTLOOK

The negative outlook reflects the lack of visibility at this stage
on a potential recovery in underlying earnings and margins in the
next 12-18 months. Moody's will consider stabilizing the outlook if
Atalian successfully prevents further decline in underlying
earnings and margins in the next 12-18 months, and maintain an
adequate liquidity profile.

FACTORS THAT COULD LEAD TO AN UPGRADE/DOWNGRADE

Whilst not expected in the near term, upward rating pressure could
be exerted if the company (1) exhibits a track record of sustained
improvement in revenue and margins, (2) reduces its
Moody's-adjusted debt/EBITDA to below 6.0x on a sustained basis,
and (3) maintains a solid liquidity profile including positive free
cash flow.

Further downward rating pressure could develop if continued
deterioration in operating performance leads to an unsustainable
capital structure or liquidity concerns including sustained
negative free cash flow.

PRINCIPAL METHODOLOGY

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

COMPANY PROFILE

Headquartered in France, Atalian is a leading provider of cleaning
and facility management services. The company operates throughout
31 countries and had revenues of around EUR2.7 billion in 2018.


NEW LOOK: French Unit Put Into Liquidation by Paris Court
---------------------------------------------------------
British high-street retailer New Look is in talks after its French
arm was put into liquidation by a Paris court, a lawyer for the
employees and staff representative told new agency Agence
France-Presse (AFP) on June 28.

According to AFP, lawyer Judith Krivine said the decision, which
was taken on June 26 by the city's commercial court, was made
following a request from the administrators after they failed to
find a credible buyer for New Look France which has been in
receivership since March.

Staff representative Moussa Koita said that talks were now underway
between the administrators, the lawyer and the British retailer,
AFP relates.

New Look has been going through a major restructuring over the past
18 months which has seen announce the closure of all its shops in
China and Belgium, and at least 60 in the UK, at the cost of 980
jobs, AFP recounts.

In the ruling, the court referred to the administrators' report,
citing the stores' lack of profitability, its termination of five
leases and the months-long closure of its flagship store in Les
Halles shopping centre in Paris, AFP discloses.

New Look France has some 400 employees working at 30 stores across
the country, AFP states.

Ms. Krivine, as cited by AFP, said despite efforts to approach the
parent company about a redundancy plan the employees were rebuffed,
prompting them to turn to the French employment ministry to
intervene.




=============
H U N G A R Y
=============

OTP BANK: Moody's Reviews Ba1 Deposit Rating for Upgrade
--------------------------------------------------------
Moody's Investors Service assigned (P)Ba1 foreign currency rating
to Subordinated Notes to be issued by Hungary's OTP Bank NyRt.
Concurrently, the rating agency placed on review for upgrade OTP
Bank's Baa2 long-term local currency deposit ratings. The rating
agency also affirmed the bank's Prime-2 short-term local currency
deposit rating and its Baa3 long-term and Prime-3 short-term
foreign currency deposit ratings as well as the bank's long and
short-term Baa2(cr)/Prime-2(cr) Counterparty Risk Assessments (CRA)
and its Baa1/Prime-2 long and short-term local and foreign currency
Counterparty Risk Ratings.

The rating agency also placed on review for upgrade OTP
Jelzalogbank Zrt.'s (OTP Mortgage Bank) Baa3 backed issuer rating
and affirmed OTP Mortgage Bank's long and short-term
Baa2(cr)/Prime-2(cr) CRAs and its Baa1/Prime-2 long and short-term
local and foreign currency CRRs.

The review on OTP Bank's and OTP Mortgage Bank's ratings was
prompted by OTP Bank's planned issue of Subordinated Notes which
will increase the loss absorption buffers for OTP Bank's depositors
and senior creditors and could result in a higher uplift in its
deposit ratings under Moody's Advanced Loss Given Failure
analysis.

RATINGS RATIONALE

  - THE SUBORDINATED NOTES

Moody's assigned a provisional (P)Ba1 foreign currency rating to
the dated Subordinated Notes to be issued by OTP Bank Nyrt. The
(P)Ba1 rating reflects Moody's loss expectation based on the
application of Moody's Advanced LGF analysis on the bank's
liabilities waterfall and the notes' features.

The notes constitute direct and unsecured obligations of OTP Bank,
are subordinated to the claims of the bank's senior creditors and
rank pari passu among themselves and any other subordinated claims
of OTP Bank which qualify as Tier 2 capital. The notes are senior
to the bank's outstanding perpetual notes, any obligations which
would constitute Tier 1 Capital and the claims of equity holders of
the bank.

  - THE REVIEW OF THE BANK'S LOCAL CURRENCY DEPOSIT RATINGS AND
MORTGAGE BANK'S ISSUER RATING

The review for upgrade on OTP Bank's Baa2 long-term local currency
deposit ratings is driven by the bank's planned issue of
subordinated debt which will result in larger loss absorption
buffers for the bank's depositors and senior creditors and may
increase the notching uplift to the bank's deposit ratings
following the application of Moody's Advanced LGF analysis.

The review of OTP Mortgage Bank's Baa3 backed issuer rating is
driven by the potential change to OTP Bank's liabilities' structure
as well as the bank's full, irrevocable and unconditional guarantee
of all of OTP Mortgage Bank's unsubordinated obligations.
Consequently, OTP Mortgage Bank's Baa3 issuer rating is aligned to
the rating level that would have been assigned to OTP Bank's senior
unsecured debt based on Moody's Advanced LGF analysis.

  - AFFIRMATION OF THE FOREIGN CURRENCY DEPOSIT RATING, CRRs AND
CRA

The affirmation of OTP Bank's long-term foreign currency deposit
rating with a stable outlook and the affirmation of the bank's CRRs
and CRA mainly reflects Moody's opinion about the significant risk
correlations between a bank and the country it operates in owing to
the limitations a government can impose on domestic entities.

OTP Bank's Baa3 long-term foreign currency rating is constrained by
the Baa3 foreign currency deposit ceiling for Hungary, and cannot
be rated higher. The Baa3 foreign currency deposit ceiling captures
the risk that the Hungarian government would interfere with a
domestic bank's repayment of foreign currency deposits.

Similarly, the bank's long-term Baa2(cr) CRA is constrained at one
notch above the Baa3 rating of the Government of Hungary and the
bank's Baa1 CRRs are currently at the same level as the country's
Baa1 foreign and local currency bond ceilings and two notches above
the government rating and cannot be rated higher.

WHAT WOULD CHANGE THE RATINGS UP/DOWN

If the bank's planned issue is successful it may widen the rating
uplift following the application of Moody's advanced LGF for OTP
Bank's deposit ratings to three notches from two currently
resulting in an upgrade of the deposit ratings and the issuer
ratings of OTP Mortgage Bank.

The bank's Baa3 foreign currency deposit rating is constrained by
the foreign currency deposit ceiling and can only be upgraded if
the ceiling is raised. OTP's Baa1 foreign and local currency CRRs
are at the same level as the foreign and local currency bond
ceilings and two notches above the government of Hungary's Baa3
bond rating and can only be upgraded if the government rating is
upgraded and the ceilings raised. The bank's Baa2(cr) CRA is
constrained at one notch above the government rating and can only
be upgraded if the government bond rating is upgraded.

The outlook on OTP Bank's and OTP Mortgage Bank's ratings could be
changed to stable if the planned issue does not materialize or the
issued amount is smaller than what the rating agency anticipates
resulting in a lower increase in the loss absorption buffers for
depositors and senior creditors.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks published
in August 2018.

FULL LIST OF ALL AFFECTED RATINGS

Issuer: OTP Bank NyRt

On Review for Upgrade:

  Long-term Bank Deposits (Local Currency), Placed on Review for
  Upgrade, currently Baa2, Outlook Changed To Rating Under Review
  From Stable

Affirmations:

Long-term Counterparty Risk Assessment, Affirmed Baa2(cr)

Short-term Counterparty Risk Assessment, Affirmed P-2(cr)

Long-term Counterparty Risk Rating, Affirmed Baa1

Short-term Counterparty Risk Rating, Affirmed P-2

Junior Subordinated Regular Bond/Debenture, Affirmed Ba3 (hyb)

Long-term Bank Deposits (Foreign Currency), Affirmed Baa3,
Outlook Remains Stable

Short-term Bank Deposits (Local Currency), Affirmed P-2

Short-term Bank Deposits (Foreign Currency), Affirmed P-3

Assignment:

Subordinate Regular Bond/Debenture (Foreign Currency),
assigned (P)Ba1

Outlook Action:

Outlook Changed To Rating Under Review From Stable

Issuer: OTP Jelzalogbank Zrt. (OTP Mortgage Bank)

On Review for Upgrade:

Backed Long-term Issuer Rating, Placed on Review for Upgrade,
currently Baa3, Outlook Changed To Rating Under Review
From Stable

Affirmations:

  Long-term Counterparty Risk Assessment, Affirmed Baa2(cr)

  Short-term Counterparty Risk Assessment, Affirmed P-2(cr)

  Long-term Counterparty Risk Ratings, Affirmed Baa1

  Short-term Counterparty Risk Ratings, Affirmed P-2

Outlook Action:

  Outlook Changed To Rating Under Review From Stable




=============
I C E L A N D
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ICELAND TOPCO: Fitch Gives B Issuer Default Rating, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has assigned Iceland Topco Limited, a UK-based
specialist food retailer, focusing on the frozen foods and value
segment, a first-time Issuer Default Rating (IDR) of 'B' with
Stable Outlook. Fitch has also assigned a senior secured debt
rating of 'B+'/'RR3' to the senior bond issued by Iceland Bondco
PLC a fully, indirectly owned subsidiary of Iceland Topco Limited.

The 'B' rating reflects Iceland's stable and profitable specialist
food operations, with a strong focus on its target customer base
and leading market position in the UK frozen food segment,
counterbalancing its small size and limited diversification.
Currently the rating is constrained by the high financial leverage
and moderate free cash flow (FCF) generation as the group continues
to develop its presence in the growing UK discount food retail
segment. The Stable Outlook reflects its expectation that Iceland
will be able to further grow the business profitably over its
four-year rating horizon to 2023.

KEY RATING DRIVERS

Specialist Business Model: Its rating reflects Iceland' specialist
business model as a niche operator that focuses on the frozen food
and value-seeking consumer segments, which have proven defensive
through consumer cycles.

Despite recent shifts in the shopping habits of the UK consumer and
the strong growth of hard discounters, Iceland mildly increased its
share in the UK grocery market between 2008 and 2018. This has been
achieved by greater differentiation in their product offering,
improved pricing, investment in stores and formats, as well as an
improved brand positioning with regard to environmental and
sustainability aspects. All this helps to broaden and diversify its
customer base.

Near-term Profitability Pressures: Fitch expects EBITDA margin to
trend towards 4% by 2022-2023 - which is still satisfactory
relative to other rated UK food retailers, down from 5.2%-5.7% in
2016-2018. Tough competition on prices, inflationary wage
pressures, particularly associated with a gradual increase of the
minimum wage, and investment in store openings - which take time to
mature - are the main drivers of its projected drop in margins.

Fitch expects Iceland's cost-saving plan, along with the roll-out
of the higher-margin Food Warehouse concept, to partly mitigate
this negative trend over the next four years, leading to a
stabilisation of margin by financial year to March 2023.

Investments Limit FCF Generation: Its negative FCF margin at 0.5%
in FY19 reflects increased investments as the company refreshes its
existing stores, develops its larger store formats, and expands
distribution capacity. Fitch expects capital intensity to decrease
towards the more historical level of 2% from its 2019 peak of 3.3%,
leading to an improvement of the FCF margin towards 1% over its
rating horizon. This will be underpinned by a prudent balancing of
capital allocation between modernisation of the store estate,
growth, and reduce debt to manage its leverage.

High Leverage Constrains Ratings: Its rating case projects
deleveraging towards 6.2x funds from operations (FFO)-adjusted net
leverage in FY23 from a peak of 7.1x in FY19. Although Fitch
expects sales to increase by GBP500 million and net debt to fall by
around GBP100 million during this period, additional rental costs
and further margin erosion will partly offset the positive effects
on lease-adjusted leverage. Fitch views such financial leverage as
high and at present as constraining Iceland to the 'B' rating
category. The Stable Outlook reflects the company's expected modest
deleveraging path.

Competitive UK Grocery Market. Fitch expects competitive pressures
to remain intense in the UK food retail industry, which continues
to adapt to changing consumer shopping habits driven by e-commerce,
convenience and a rising share of hard discounters. All these
trends have led to a gradual erosion of profitability across the UK
food retailing sector, bringing it more in line with developed
Western European markets', despite a still high market
concentration on the top-four players.

Nevertheless, the UK food retail sector has seen a significant
repositioning, with players implementing a clearer focus on target
customers, price and product range and adopting store formats.
Hence, Fitch views the current competitive landscape as more
manageable compared with non-food competition, due to the return of
food price inflation, improved response from traditional retail to
discounters, and limited scope for further large scale
consolidation following the blocked Sainsbury/Asda merger by the
UK's competition authority.

Above-average Recoveries for Senior Lenders: In a distressed
scenario, Fitch assumes that Iceland would likely be sold or
restructured as a going concern rather than liquidated given its
asset-light business structure and brand value. On reaching a
post-restructuring EBITDA, Fitch applied a 20% discount to
Iceland's FY19 EBITDA, a level that would erode FCF generation
turning leverage as a significant outlier. Fitch then applied an
enterprise value/EBITDA multiple 4.5x to reflect the company's
distressed valuation in such a scenario.

Based on the payment waterfall the revolving credit facility (RCF)
of GBP30 million ranks super senior to the senior secured debt.
After deducting 10% for administrative claims, its waterfall
analysis generates a ranked recovery for the senior secured bond in
the 'RR3' band, indicating a 'B+' instrument rating. The waterfall
analysis output percentage on current metrics and assumptions was
55%.

DERIVATION SUMMARY

Fitch applies its Food Retail Navigator framework to rate Iceland
Topco Limited. Iceland's business risk profile as a mostly UK-based
specialist food retailer is constrained by its modest size and
diversification compared with other Fitch-rated European food
retailers such as Tesco PLC (BBB-/Stable), Carrefour SA
(BBB/Stable) and Ahold Delhaize NV (BBB+/Stable), all of which have
leading market shares in their core domestic markets, larger scale,
as well as greater diversification by product, store format,
distribution channel, and geography.

Iceland's specialist retail preposition and strong offer of
own-label products lead to higher EBITDA margins compared with
higher-rated European peers,' such as Tesco and Carrefour. Iceland
also continues to invest in expanding selling space to protect its
market position in the growing UK discount food retail segment.
This leads to modest FCF margins, which are broadly in line with
the sector's, but limit material near-term deleveraging. This,
together with structurally higher financial leverage than larger
peers' and a narrower and specialist business profile, confines the
rating currently to the 'B' category.

Compared with more specialist UK food retailers such as Ocado Group
PLC (BB-/Negative), the fundamental difference lies in the business
model. Ocado is transforming from an online food retailer into a
technology solutions business with business service
characteristics, as it partners its online delivery platform with
international retailers.

Compared with French specialist food retailer also active in frozen
foods, Picard Bondco SA (B/Stable), Iceland is larger in size, but
weaker in profitability and FFO. Picard operates mostly in the
higher-margin premium segment. On the other hand Picard's financial
risk profile and financial leverage are higher than Iceland's, with
FFO adjusted net financial leverage at around 8.5x following two
consecutive dividend recaps in December 2017 and May 2018.

KEY ASSUMPTIONS

  - Revenue growth averaging 3.8% p.a. over the next four years,
sustained by store openings

  - EBITDA margin trending lower towards 4% by FY22, amid extended
pressure on gross margin

  - Capex estimated at 2%-2.5% of revenue over the next four years

  - No dividend over the next four years

  - Restricted cash of GBP20 million to allow for intra-year
working capital swings and running of the operations

  - Minimum cash estimated at GBP100 million, with excess cash used
for debt buy-backs

RATING SENSITIVITIES

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

Fitch views an upgrade of the IDR as unlikely over the rating
horizon, unless the company sees material improvements in operating
performance and adopts more conservative capital allocation.
However Fitch could envisage a positive rating action as a result
of:

  - Evidence of positive and profitable like-for-like sales growth
and maintaining stable market shares leading to

  - Resilient profitability with EBITDA margins trending towards
5%

  - FFO adjusted gross leverage below 6.0x on a sustained basis

  - FFO fixed charge coverage at or above 2.0x on a sustained
basis

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

  - Evidence of negative like-for-like sales growth, with loss of
market shares, leading to

  - Prolonged and accelerating EBITDA margin erosion and/or neutral
FCF

  - FFO adjusted gross leverage above 7.0x on a sustained basis

  - FFO fixed charge coverage below 1.5x on a sustained basis

LIQUIDITY AND DEBT STRUCTURE

Adequate Liquidity: Fitch views Iceland's liquidity position as of
FY19 as satisfactory in light of GBP91 million of readily available
liquidly, which excludes restricted GBP20 million for working
capital purposes, along with GBP30 million of an undrawn RCF.
Short-term financial debt maturities are limited to GBP11 million
of capital leases, while the majority of long-term indebtedness
will expire after five years. In addition, the company plans to
continue to buy back outstanding bonds in the market using internal
generated cash flow. This is supported by a positive working
capital inflow stemming from anticipated growth of its business.




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

PENTA CLO 6: Moody's Assigns (P)B3 Rating on EUR10MM Cl. F Notes
----------------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following provisional ratings to notes to be issued by Penta CLO 6
Designated Activity Company:

EUR248,000,000 Class A Senior Secured Floating Rate Notes due 2032,
Assigned (P)Aaa (sf)

EUR23,000,000 Class B-1 Senior Secured Floating Rate Notes due
2032, Assigned (P)Aa2 (sf)

EUR15,000,000 Class B-2 Senior Secured Fixed Rate Notes due 2032,
Assigned (P)Aa2 (sf)

EUR25,000,000 Class C Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)A2 (sf)

EUR27,000,000 Class D Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)Baa3 (sf)

EUR22,000,000 Class E Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)Ba3 (sf)

EUR10,000,000 Class F Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)B3 (sf)

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

RATINGS RATIONALE

The rationale for the ratings is based on a consideration of the
risks associated with the CLO's portfolio and structure as
described in its methodology.

Penta CLO 6 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 80%
ramped up as of the closing date and to be comprised predominantly
of corporate loans to obligors domiciled in Western Europe.

Partners Group (UK) Management Ltd 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 and a half
year reinvestment period. Thereafter, purchases are permitted using
principal proceeds from unscheduled principal payments and proceeds
from sales of credit risk and credit improved obligations are
subject to certain restrictions.

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR 37,600,000 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
March 2019.

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. RR's investment decisions and management of the
transaction will also affect the notes' performance.

Moody's modeled the transaction using 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 March 2019.

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

Par amount: EUR 400,000,000

Diversity Score: 42

Weighted Average Rating Factor (WARF): 2850

Weighted Average Spread (WAS): 3.60%

Weighted Average Coupon (WAC): 4.50%

Weighted Average Recovery Rate (WARR): 43.50%

Weighted Average Life (WAL): 8.5 years


PENTA CLO VI: Fitch Assigns B-(EXP)sf Rating on Class F Debt
------------------------------------------------------------
Fitch Ratings has assigned Penta CLO VI Designated Activity Company
expected ratings as follows:

Class A: 'AAA(EXP)sf'; Outlook Stable

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

Class B-2: 'AA(EXP)sf'; Outlook Stable

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

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

Class E: 'BB-(EXP)sf'; Outlook Stable

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

Subordinated notes: 'NR(EXP)sf'

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

The transaction is a cash flow collateralised loan obligation (CLO)
of mainly European senior secured obligations. Net proceeds from
the issuance of the notes will be used to fund a portfolio with a
target amount of EUR400 million. The portfolio is managed by
Partners Group Management (UK) Ltd. The CLO features a 4.5-year
reinvestment period and a 8.5-year weighted average life (WAL).

KEY RATING DRIVERS

'B' Portfolio Credit Quality

Fitch expects the average credit quality of obligors to be in the
'B' category. The Fitch- weighted average rating factor (WARF) of
the current portfolio is 32.25, below the indicative covenanted
maximum of 33.

High Recovery Expectations

At least 90% 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 69.5%, which is above the indicative covenanted
minimum of 64%.

Diversified Asset Portfolio

The transaction will include Fitch test matrices corresponding to
different top 10 obligor concentration limits and maximum
fixed-rate obligations limits. The transaction also includes
various other concentration limits, including the maximum exposure
to the three-largest Fitch-defined industries in the portfolio at
40% with 17.5% for the top industry. These covenants ensure that
the asset portfolio will not be exposed to excessive
concentration.

Portfolio Management

The transaction has a 4.5-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. This was also used to test
the various structural features of the transaction, as well as to
assess their effectiveness, including the structural protection
provided by excess spread diverted through the par value and
interest coverage tests.

Recovery Rate to Secured Senior Obligations

For the purpose of Fitch's Recovery Rate (RR) calculation, in case
no recovery estimate is assigned, senior secured loans with a
revolving credit facility (RCF) limit of 15% will be assumed to
have a strong recovery. For senior secured bonds, recovery will be
assumed at 'RR3'. The different treatment in regards to recovery
reflects historically lower recoveries observed for bonds and that
RCFs typically rank pari passu with loans but senior to bonds. The
transaction features an RCF limit of 15% to be considered when
categorising the loan or bond as senior secured.


PROVIDUS CLO III: Moody's Gives (P)B3 Rating to EUR10MM Cl. F Notes
-------------------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following provisional ratings to notes to be issued by Providus CLO
III Designated Activity Company:

EUR232,500,000 Class A Senior Secured Floating Rate Notes due 2032,
Assigned (P)Aaa (sf)

EUR17,250,000 Class B-1 Senior Secured Floating Rate Notes due
2032, Assigned (P)Aa2 (sf)

EUR16,500,000 Class B-2 Senior Secured Fixed Rate Notes due 2032,
Assigned (P)Aa2 (sf)

EUR26,750,000 Class C Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)A2 (sf)

EUR24,600,000 Class D Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)Baa3 (sf)

EUR19,900,000 Class E Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)Ba3 (sf)

EUR10,000,000 Class F Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)B3 (sf)

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

RATINGS RATIONALE

The rationale for the rating is based on a consideration of the
risks associated with the CLO's portfolio and structure as
described in its methodology.

The Issuer is a managed cash flow CLO. At least 90% of the
portfolio must consist of senior secured obligations and up to 10%
of the portfolio may consist of senior unsecured obligations,
second-lien loans, mezzanine obligations and high yield bonds. The
portfolio is expected to be 70% ramped as of the closing date and
to comprise of predominantly corporate loans to obligors domiciled
in Western Europe. The remainder of the portfolio will be acquired
during the 8-month ramp-up period in compliance with the portfolio
guidelines.

Permira Debt Managers Group Holdings Limited 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 remaining
transaction's four and a half-year reinvestment period. Thereafter,
subject to certain restrictions, purchases are permitted using
principal proceeds from unscheduled principal payments and proceeds
from sales of credit risk obligations or credit improved
obligations.

In addition to the seven classes of notes rated by Moody's, the
Issuer will issue EUR 34,700,000.00 of Subordinated Notes which are
not 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
March 2019.

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. The collateral manager's investment decisions and
management of the transaction will also affect the notes'
performance.


WEATHERFORD INT'L: S&P Lowers ICR to 'D' on Chap. 11 Filing
-----------------------------------------------------------
S&P Global Ratings downgraded Ireland-based oilfield services
provider Weatherford International PLC to 'D' from 'CC'.

S&P said, "At the same time, we are lowering our issue-level rating
on the company's secured term loan to 'D' from 'CCC', our
issue-level rating on its senior unsecured guaranteed revolving
credit facility to 'D' from 'CCC-', and our issue-level rating on
its senior unsecured notes to 'D' from 'C'.

"Our '1' recovery rating on Weatherford's secured term loan remains
unchanged, indicating our expectation for very high (90%-100%;
rounded estimate: 95%) recovery for creditors in the event of a
default. Our '2' recovery rating on the company's senior unsecured
guaranteed revolving credit facility also remains unchanged,
indicating our expectation for substantial (70%-90%; rounded
estimate: 85%) recovery for creditors in the event of a default. In
addition, our '5' recovery rating on the company's senior unsecured
debt remains unchanged, indicating our expectation for modest
(10%-30%; rounded estimate: 20%) recovery for creditors in the
event of a default."

Weatherford International PLC announced that it had voluntarily
filed a prepackaged Chapter 11 bankruptcy plan as part of its
previously announced financial restructuring. S&P expects the
company to file for examinership proceedings in Bermuda and Ireland
in the coming months.

As of June 28, 2019, 79% of Weatherford's senior unsecured
noteholders had agreed to its restructuring plan, under which the
company will exchange its existing unsecured debt ($7.4 billion of
expected claims) for 99% of its equity plus up to $1.25 billion of
new tranche B senior unsecured notes (up to $500 million of which
can be converted to common stock at the holder's option). The
consenting noteholders also agreed to backstop up to $1.25 billion
of new tranche A senior unsecured notes to repay the
debtor-in-possession (DIP) financing at the company's emergence
from bankruptcy. In addition, Weatherford will receive $1.75
billion of DIP financing under the agreement, which will comprise a
$1 billion DIP term loan backstopped by the consenting noteholders
and a $750 million DIP credit facility.

Weatherford will repay its first-lien term loan (expected claims of
$298 million) and 364-day facility (expected claims of $317
million) in full with the proceeds from the proposed DIP facility.
The company will also cash collateralize its letters of credit
andrepay its unsecured revolving credit claims (expected $305
million) at emergence.




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

ALITALIA SPA: Toto Group Plans to Invest in Business
----------------------------------------------------
Daniele Lepido at Bloomberg News reports that Alitalia lured
interest from Toto Group, a holding that spans from renewable
energies to toll-road concessions that is controlled by Italian
entrepreneur Carlo Toto.

According to Bloomberg, a company's spokesman wrote on June 30 in a
letter to daily Il Messaggero that after a failed attempt in 2008
of investing in Alitalia, Toto Group is now reviewing the option of
investing in the carrier "relying on its entrepreneurial experience
and adequate economic resources".

                         About Alitalia

With headquarters in Fiumicino, Rome, Italy, Alitalia is the flag
carrier of Italy.  Its main hub is Leonardo da Vinci-Fiumicino
Airport, Rome.

On May 2, 2017, the airline went into administration. As previously
reported by the Troubled Company Reporter - Europe, state-appointed
administrators have been running Alitalia since 2017, after former
shareholder Etihad Airways pulled the plug on
funding and workers rejected a EUR2 billion recapitalization plan
tied to 1,600 job cuts from a workforce of 12,500, Bloomberg News
cited.


CORDUSIO RMBS: S&P Affirms B- Rating on Class E Notes
-----------------------------------------------------
S&P Global Ratings raised its ratings on the class B and C notes
and affirmed its ratings on the class A3, D, and E notes from
Cordusio RMBS Securitisation S.r.l..

S&P said, "Upon publication of our revised criteria for assessing
counterparty and sovereign risk in structured finance transactions,
we added the under criteria observation (UCO) identifier to our
ratings on the class A3, B, and C notes from this transaction,
which could have been affected by the change in criteria. Following
our review of this transaction, our ratings on these notes are no
longer under criteria observation.

"The upgrades follow our credit and cash flow analysis of the most
recent transaction information that we have received for the
payment occurring in March 2019."

The available credit enhancement increased since S&P's previous
review for the following classes:

-- Class A3 notes' increased to 31.96% from 26.65%;
-- Class B notes' increased to 22.53% from 18.71%;
-- Class C notes' increased to 16.72% from 13.81%;
-- Class D notes' increased to 3.19% from 2.42%; and
-- Class E notes' increased to 0.60% from 0.24%.

The cash reserve is nonamortizing, and it is currently at target at
EUR6.18 million, representing 0.15% of the of the notes' principal
amount outstanding as of the issue date.

S&P said, "The analytical framework in our revised structured
finance sovereign risk criteria assesses the ability of a security
to withstand a sovereign default scenario. We have applied these
criteria and determined the sensitivity of this transaction to
sovereign risk as low. Therefore, the highest rating that we can
assign to the tranches in this transaction is six notches above the
unsolicited Italian sovereign rating, or 'AA (sf)', if certain
conditions are met.

"Credit Suisse International (CSI) acts as swap counterparty in
this transaction. Under our previous counterparty criteria, the
swap counterparty could only support a maximum achievable rating of
'AA (sf)' on all classes of notes. We have reviewed the swap
agreement under our revised counterparty criteria and assessed the
collateral framework as adequate. Under our new criteria, the
applicable rating for the swap counterparty is the resolution
counterparty rating (RCR), equal to 'AA-', and the resulting
maximum supported rating on the class of notes is 'AA (sf)', which
is one notch above the RCR on CSI. This means that the rating on
the class A notes is now linked to the RCR on CSI.

"Taking into account the results of our updated credit and cash
flow analysis, the available credit enhancement for the rated notes
is sufficient to withstand the stresses that we apply at a 'AAA'
rating level for the class A3, B, and C notes. However, our ratings
above the sovereign and our counterparty criteria constrain our
ratings on these classes at 'AA (sf)'. We have therefore affirmed
our 'AA (sf)' rating on the class A3 notes and raised to 'AA (sf)'
from 'A+ (sf)' our ratings on the class B and C notes.

"In our cash flow analysis, the class D notes cannot withstand a
commingling stress equal to two months' collection of interest and
principal (including a certain amount of assumed prepayments).
Therefore, we have not stressed commingling risk in our analysis,
and our rating on the class D notes is now weak-linked to our
long-term issuer credit rating (ICR) on UniCredit Group. We have
therefore affirmed our 'BBB (sf)' rating on the class D notes. Any
change to our ICR on UniCredit could result in an equivalent change
to our rating on the transaction's class D notes, all else being
equal.

"In our view, given the current level of credit enhancement,
payment of timely interest and principal on the class E notes is
not dependent upon favorable business, financial, and economic
conditions. We have therefore affirmed our 'B- (sf)' rating on the
class E notes."

Cordusio RMBS Securitisation is an Italian RMBS transaction, which
closed in May 2007 and securitizes first-ranking residential
mortgage loans. UniCredit originated the pool, which comprises
loans granted to prime borrowers, mainly located in northern
Italy.

  Ratings List

  Cordusio RMBS Securitisation S.r.l.

  Class Rating to Rating from
  B     AA (sf)         A+ (sf)
  C    AA (sf)         A+ (sf)
  
  Class Rating
  A3    AA (sf)
  D    BBB (sf)
  E     B- (sf)




===================
K A Z A K H S T A N
===================

AGRARIAN CREDIT: Moody's Assigns Ba1 Issuer Ratings, Outlook Stable
-------------------------------------------------------------------
Moody's Investors Service assigned Ba1 long-term and Not Prime
short-term local- and foreign currency issuer ratings to
Kazakhstan-based Agrarian Credit Corporation JSC as well as the Ba1
Corporate Family Rating. The outlook on ACC changed to stable from
withdrawn. At the same time, Moody's assigned the Aa3.kz long-term
National Scale Issuer Rating to the issuer.

RATINGS RATIONALE

ACC's assigned CFR benefits from very high support from its
immediate parent KazAgro National Management Holding JSC (KazAgro,
Ba1 stable), which is 100% owned by the Government of Kazakhstan
(Baa3 stable). As a result, Moody's incorporates four notches of
rating uplift based on its parental support assumptions, from ACC's
standalone assessment of b2, which reflects (1) the company's
historically strong profitability, (2) substantial capital buffers,
(3) the risks associated with ACC's weakly performing and risky
loan book and (4) modest liquidity. The elevated risk appetite
reflected in rapid growth makes its financial metrics potentially
volatile.

The assignment of ACC's long-term issuer ratings of Ba1 reflects
the relative positioning of unsecured obligations under Moody's LGD
model for Speculative Grade Companies.

The very high support from KazAgro reflects ACC's strategic
importance due to its special mandate to develop financing to the
agriculture sector. ACC participates in government programmes and
its funding is predominantly comprised of dues to its parent and
the government. The company is ranked first by total assets among
KazAgro's subsidiaries and had around 40% share in combined total
assets of all KazAgro's subsidiaries at end-2018.

Moody's believes the parent would provide financial support to ACC,
if it were necessary, to avoid significant reputational damage,
reduced access to market funding for its subsidiaries or impairment
or disruption in the implementation of important government
programmes. Moody's believes that in some cases extraordinary
support will be originally provided by the government of Kazakhstan
given that ACC's parent company, KazAgro, is de-facto the
government financial arm which manages the subsidiaries under its
umbrella.

ACC's policy mandate exposes it to the elevated risks of
agriculture sector given its cyclical and volatile nature. As a
result, the company's problem loans (defined as Stage 3 loans under
IFRS 9) accounted for a high 38% of the loan book (including
exposures to banks which on-lend resources to agriculture
producers) at end-2018. In addition, seasoning of the rapidly grown
loan book will lead to deterioration of asset quality further.

ACC's policy mandate secures its business niche and ensures a good
access to capital while cheap government funding supports its
profitability. Moody's expects ACC's capitalisation to remain
reasonable and does not expect tangible common equity to tangible
managed assets (TCE/TMA) ratio to fall below 20% in the next 12-18
months. At end-Q1 2019, TCE/TMA ratio was a high 34% and its
regulatory capital ratios were well above the required minimum. At
the same time, there is a pressure on capitalization from very
rapid loan growth.

ACC demonstrated good profitability: the net income to average
managed assets ratio was 3.4% in 2018 and 4.6% in Q1 2019.
Profitability benefits from high net interest margin (due to cheap
government funding and large capital base) and low operating costs.
At the same time, profitability is potentially volatile and may
deteriorate significantly as reserves covered problem loans by only
34% at end-2018.

The company maintains a modest liquidity cushion (around 7-10% of
total assets) and large repayments make it exposed to refinancing
risk or risk of significant reduction of business in order to meet
such repayments. At the same time, it is substantially mitigated by
reliance on more stable parental and government funding (almost all
funding at end-Q1 2019). Greater reliance on market debt will exert
additional pressure on liquidity.

OUTLOOK

The stable outlook on ACC mirrors the stable outlook on its parent,
KazAgro. In addition, Moody's does not expect that developments in
ACC's key credit metrics such as capital, liquidity and asset
quality will result in significant change in ACC's standalone
financial profile in the next 12-18 months.

WHAT COULD MOVE THE RATINGS UP/DOWN

Upside potential of the issuer ratings and CFR is constrained by
KazAgro's ratings given that they are at the same level. A
sustained track record of improved asset performance, and the
maintenance of healthy capital and liquidity profiles could have
upward implications for ACC's standalone assessment.

ACC's long-term ratings could be downgraded in case of a downgrade
of KazAgro's ratings, reduced support assumptions for ACC or asset
quality or liquidity deterioration beyond Moody's expectations.
Further, Moody's could downgrade ACC's issuer ratings due to
adverse changes to its debt capital structure that would lower the
recovery rate for senior unsecured debt classes.


DAMU ENTREPRENEURSHIP: S&P Affirms 'BB+/B' ICRs, Outlook Stable
---------------------------------------------------------------
S&P Global Ratings affirmed its 'BB+/B' long- and short-term
foreign- and local-currency issuer credit ratings on DAMU
Entrepreneurship Development Fund (DAMU). The outlook is stable.

At the same time, S&P affirmed the Kazakhstan national scale rating
on DAMU at 'kzAA+'.

S&P said, "The affirmation primarily reflects our view that--given
its mandate to support and develop the small and midsize enterprise
(SME) sector in Kazakhstan--DAMU remains a core institution within
the Baiterek group. We believe that the Baiterek group would
benefit from almost certain government support because it includes
several financial institutions that play key roles in the
government's development agenda.

"Under our group rating methodology (GRM), we assess the Baiterek
group credit profile (GCP) at 'bb+', which reflects the
creditworthiness of its consolidated operations, taking into
account the likelihood of extraordinary government support and the
'BBB-' sovereign credit ratings on Kazakhstan. The GCP assessment
is one notch lower than the sovereign ratings, due to our concerns
that Kazakhstan's willingness to support GREs is subject to
transition risk. Our view is informed by the authorities'
comparatively limited involvement in ensuring timely payment of the
obligations of railway company Kazakhstan Temir Zholy, a key
subsidiary of Samruk-Kazyna. For more details, see "Ratings On
Kazakhstan's DAMU Lowered To 'BB+/B' On Negative Trend In
Government Support; Outlook Negative," published June 30, 2017, on
RatingsDirect.

"We view DAMU as playing a core role within the Baiterek group, and
therefore equalize the rating with the Baiterek group's GCP. DAMU
is one of the largest members of the group, accounting for about 6%
of consolidated assets as of year-end 2018. DAMU's general mandate
to contribute to the development of Kazakhstan's entrepreneurship
and the SME sector closely aligns with the overall Baiterek group
strategy. We expect that DAMU will continue implementing various
government programs that support the SME sector and job growth. We
also consider it highly unlikely that Baiterek would privatize
DAMU."

S&P assesses DAMU's rating under its GRE methodology. S&P believes
there is an extremely high likelihood that the government would
provide timely extraordinary support to DAMU if needed, based on:

-- DAMU's integral link with the government of Kazakhstan, which
fully owns DAMU through National Management Holding Baiterek. DAMU
was established in 1997 by presidential decree. The status of DAMU
is reflected in the law "On Private Entrepreneurship," which refers
to the fund as an institution contributing to entrepreneurship
development on behalf of the government; and

-- DAMU's very important role for the government as the
institution supporting the SME sector in Kazakhstan. The government
has set out the expansion of the sector as a priority for the
development and diversification of the Kazakh economy. DAMU
contributes to implementing several government development programs
including the SME support program Business Roadmap 2020--now
extended to 2025, the infrastructure program Nurly Zhol, and a new
program focused on the development of productive employment and
entrepreneurship for 2017-2021.

S&P said, "We have revised DAMU's stand-alone credit profile (SACP)
to 'b' from 'b-' because we believe that DAMU's capital and risk
position are stabilizing. This view is supported by a planned
Kazakhstani tenge (KZT) 30 billion capital injection from the
government in mid-2019, as well as the downsizing of its exposure
to defaulted Tsesnabank through the posting of losses and the
consequent write offs of loans. The fund's SACP reflects the
combination of the 'b+' anchor for Kazakhstan banks, which is
driven by high economic and industry risks for the system, its
broad exposure to the Kazakh banking sector, somewhat concentrated
funding, and lack of direct access to national bank funding.

DAMU is exposed to the Kazakh banking sector, through which it
provides loans and guarantees to SMEs. The fund's asset quality
compares well to the majority of rated Kazakh banks. Its reported
Stage 3 and Stage 2 loans stood at 3.0% and 2.5% of total loans as
of year-end 2018, compared with our combined estimate of 20%-25%
for the Kazakh banking system. DAMU's funding is concentrated in
government sources and loans from international development
institutions and, unlike commercial banks, it does not have access
to emergency funding from the National Bank of Kazakhstan.

"The stable outlook on DAMU mirrors the outlook on our sovereign
ratings on Kazakhstan. Any rating action on the sovereign would
likely result in a similar action on the fund.

"We could lower our ratings on DAMU if we saw signs of waning
government support to the Baiterek group, or, more broadly, to
other GREs over the next 12 months.

"We could raise the ratings on DAMU if Kazakhstan's monitoring of
its GRE debt and the efficiency of its administrative mechanisms to
provide extraordinary support to Kazakh GREs improved."


DEVELOPMENT BANK OF KAZAKHSTAN: S&P Affirms 'B+/B' ICRs
-------------------------------------------------------
S&P Global Ratings said that it had affirmed its 'BB+/B' long- and
short-term foreign- and local-currency issuer credit ratings on the
Development Bank of Kazakhstan (DBK). The outlook is stable. At the
same time, S&P affirmed the Kazakhstan national scale rating on DBK
at 'kzAA+' and the 'BB+' issue rating on the bank's senior
unsecured bonds.

S&P siad, "In our view, there is an almost certain likelihood that
the government of Kazakhstan would provide timely and extraordinary
support to DBK in a financial stress scenario. DBK is the largest
entity within the government-owned Baiterek group and we expect it
to remain core to the overall Baiterek group strategy, which is
broadly aimed at supporting Kazakhstan's economic development and
diversification."

S&P expect DBK to benefit from a considerable degree of government
backing. Specifically, it assesses the likelihood of extraordinary
government support as almost certain based on:

-- DBK's integral link with the government of Kazakhstan, which
fully owns and monitors DBK through the National Management Holding
Baiterek.

-- DBK's critical role as the primary institution mandated to
develop Kazakhstan's production infrastructure and the processing
industry.

S&P said, "Our 'BB+' rating on DBK is one notch lower than the
'BBB-' local currency sovereign rating, due to our concerns that
Kazakhstan's willingness to support government-related entities is
subject to transition risk. Our view is informed by the
authorities' comparatively limited involvement in ensuring timely
payment of the obligations of railway company Kazakhstan Temir
Zholy, a key subsidiary of Samruk-Kazyna. For more details, please
see "Ratings On Development Bank of Kazakhstan Lowered To 'BB+/B'
On Negative Trend In Government Support; Outlook Negative,"
published June 30, 2017, on RatingsDirect.

"We also assess the DBK rating under our Group Rating Methodology,
as DBK is part of the Baiterek group. The Baiterek group credit
profile (GCP) reflects the creditworthiness of the consolidated
operations of the group, taking into account extraordinary
government support from Kazakhstan. Our assessment of the GCP at
'bb+' is also one notch lower than the 'BBB-' local currency
sovereign rating.

"We consider DBK to be a core subsidiary of the Baiterek group,
accounting for about 54% of Baiterek's assets as of end-2018 and
fulfilling a critical role of financing large-scale industrial
investment projects. We therefore equalize our rating on DBK with
our GCP assessment on Baiterek. DBK's general mandate to contribute
to the development of Kazakhstan's economy through investments in
priority sectors closely aligns with the overall Baiterek group
strategy. We also consider it highly unlikely that DBK would be
sold.

"We continue to assess DBK's stand-alone credit profile at 'b'. It
reflects the combination of the 'b+' anchor for banks operating in
Kazakhstan, which we derive based on the high economic and industry
risks for the system, and DBK's relatively large but concentrated
portfolio of loans to largest Kazakh borrowers, adequate
capitalization, but also somewhat concentrated funding and lack of
direct access to support from the National Bank of Kazakhstan.

"We expect the bank will maintain adequate capitalization in the
next two years, supported by planned capital injections from the
government, in line with its track record. The bank has high
individual and sector lending concentrations, but low reported
nonperforming loans (NPLs) following the transfer of legacy NPLs to
the Investment Fund of Kazakhstan a few years ago. The bank's
liquid assets adequately cover its short-term debt repayments. DBK
aims to diversify its lending across a variety of market sources
and to reduce its reliance on government funding."

The stable outlook on DBK mirrors the outlook on Kazakhstan. Any
rating action on the sovereign would likely result in a similar
action on the bank.

"We could lower our rating on DBK if we saw signs of waning
government support to the Baiterek group, or, more broadly, to
other GREs over the next 12 months.

"We could raise the rating on DBK if Kazakhstan's monitoring of its
GRE debt and the efficiency of its administrative mechanisms to
provide extraordinary support to GREs improved."


EURASIAN RESOURCES: S&P Alters Outlook to Stable & Affirms B ICRs
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'B/B' long-term and short-term
ratings on Kazakh miner Eurasian Resources Group (ERG).

S&P said, "The affirmation reflects our view that ERG will have FFO
to debt in the 12%-20% range in the next two years under the
current market environment. We now see less probability the company
could outperform this base-case scenario due to a marked fall in
FeCr prices that started in the second half of 2018. Prices peaked
at $1.03 per pound (/lb), as per FeCr (50% Cr) CIF China import
Shanghai, in March 2018, and are currently at $0.74/lb, and we note
that FeCr represented 51% of ERG's EBITDA in 2018. There were also
technical difficulties leading to a slower ramp-up of the company's
RTR project in the Democratic Republic of Congo (DR Congo), which
should have added volumes of copper and cobalt from the end of
2018. We understand ERG has started selling first volumes of metals
from Metalkol RTR, but full ramp-up is not likely until at least
the end of this year. As a result, we anticipate the company to
post weak results for 2018, with EBITDA of about $1.8 billion-$1.9
billion, slightly negative free operating cash flow (FOCF), and FFO
to debt of 10%-11%."

ERG countered these setbacks by updating its capital expenditure
(capex) plans with lower annual spending of $700 million-$800
million in 2019-2020 (versus $1.0 billion-$1.1 billion previously)
and a more conservative approach toward dividends (nil in 2019).
These updates will likely support the company's performance metrics
in 2019 and enable moderate deleveraging from 2020.

The ratings continue to reflect high absolute reported debt amount,
which ERG is unable to reduce meaningfully in the current
environment. The company is highly exposed to volatile commodity
prices (notably on FeCr, aluminum, and iron ore), and exchange
rates of the Kazakhstani tenge to major hard currencies. Other
constraints include the capital intensity of ERG's business and
project risks related to its sizable investment plan. Furthermore,
the group faces high country risks because most of its assets are
in Kazakhstan and, to a lesser extent, in DR Congo, where ERG has
been investing in reprocessing of tailings of copper and cobalt at
its Metalkol RTR site. S&P notes the high regulatory and country
risks in DR Congo have already translated into delays and higher
costs for ERG after the adoption of the new Mining Code in 2018.

S&P said, "We think the U.K.'s Serious Fraud Office's criminal
investigation, started in 2013, into Eurasia Natural Resources
Corporation, a part of ERG, also weighs on the company's profile.
No official charges have been made, and potential financial
consequences are hard to estimate. In the meantime, we have noted
that the company's management has demonstrated a less aggressive
stance to investments (showing examples of capex moderation) and a
proactive approach to maturity management. We will continue
monitoring developments in order to assess the investigation's
potential impact on ERG's credit quality."

ERG's business risk profile is supported by the low cost position
of its mining operations, especially in FeCr, where the group has a
sizable global market share of 13%. Additional supports include the
group's elevated and resilient profitability throughout the cycle
and growth potential after 2019, when the ongoing RTR project will
start to contribute to earnings and cash flows.

S&P said, "We currently assess the likelihood of ERG receiving
timely and sufficient extraordinary state support as low, since we
believe the government is more interested in ERG's continued
operations rather than the timeliness of its debt repayments. We
base our view on our observations over 2015-2016 when ERG faced
sizable liquidity shortfalls and covenant breaches without
extraordinary government support (such as capital injections). We
continue to factor continual state support into our ratings on ERG,
however, since we have seen various examples of tangible ongoing
support from Kazakhstan to ERG. We think these actions were
motivated by ERG's role as a sizable mining company in the country
and a relatively big employer (with a large workforce in remote
regions). That said, we think this may also prompt the government
to facilitate the company undertaking further investments into
social infrastructure projects."

The stable outlook balances ERG's highly leveraged position, large
planned capex, and the volatility of the key commodities' markets
with the company's manageable maturity profile (until at least
2023), good positions on the production cash cost curves for
ferroalloys, aluminum and iron ore, and minimal dividend pressure.

S&P said, "Our base case for ERG envisages FFO to debt in the
12%-20% range over 2019-2020 in the current pricing environment and
incorporates some flexibility in capex, translating into our
expectation of positive FOCF in the next two years."

Rating pressure could emerge if credit metrics deteriorate, with
FFO to debt stabilizing below the 12% threshold for the current
rating. This could happen if:

-- There is a prolonged drop in commodity prices, notably FeCr, or
lower-than-expected production volumes that led to a material cash
flow deficit;

-- Increased investment cash outflows (for example, due to
projects cost overruns) or acquisitions resulting in rapid debt
accumulation; or

-- The group incurs a sizable penalty payable as a result of the
SFO investigation.

S&P said, "We could take a positive rating action if ERG turns
sustainably cash flow positive (after capex and debt service) and
its credit metrics improve, with FFO to debt of above 20% on a
sustainable basis. This could occur if commodity prices are more
supportive than we currently assume or in the event of a more
accelerated ramp-up of the RTR project.

"We note that the company's deleveraging is highly exposed to the
commodities pricing performance, which showed very strong
volatility in the recent years for such metals as FeCr (contributed
about half of ERG's EBITDA in 2018), aluminum, and iron ore. An
upgrade would also require actual reduction of absolute debt level,
since we consider the company to be highly leveraged for its
scale."

Furthermore, an upgrade would require clarity on the potential
outcome of the SFO investigation and no significant shortfalls in
the liquidity position in the next 24 months.


FREEDOM FINANCE: S&P Assigns 'B-/B' Issuer Credit Ratings
---------------------------------------------------------
On June 28, 2019, S&P Global Ratings said that it assigned its
'B-/B' long- and short-term issuer credit ratings to securities
companies Freedom Finance JSC and Investment Company Freedom
Finance LLC. The outlook on both ratings is stable.

At the same time, S&P assigned a 'kzBB-' Kazakh national scale
rating to Freedom Finance JSC.

Freedom Holding Corp. is a group of securities companies (Freedom
Finance Group) operating in the markets of the former Soviet Union,
in particular Russia and Kazakhstan via its subsidiaries Investment
Company Freedom Finance LLC (Freedom RU) and Freedom Finance JSC
(Freedom KZ), respectively. Other notable subsidiaries of the group
include a bank in Russia and a broker in Cyprus (Freedom CY), along
with subsidiaries in Uzbekistan and Ukraine, but their activities
are minor. The group focuses primarily on retail brokerage,
offering clients access to the U.S. and domestic markets.

Freedom Finance Group is still in the process of transformation.
Historically, the licensed entities that currently constitute the
group were owned by Timur Turlov. They were merged under the single
umbrella of Freedom Holding Corp. in the past few years. S&P
believes the process is still unfinished. For example, Mr. Turlov
retains an interest in two insurance companies in Kazakhstan
(property/casualty and life) outside the consolidation perimeter.
S&P estimates, however, that risks outside of the consolidation
perimeter are not sufficiently material to weigh on the group
credit profile (GCP), and believes these companies are likely to
move under the group umbrella, which will increase transparency.

The stable outlook on Freedom Finance JSC and Investment Company
Freedom Finance LLC reflects S&P's expectation that, over the next
12-18 months, the group will gradually build its commission income
while retaining sizable proprietary positions in stocks on its
Kazakhstani balance sheet.

A positive rating action will likely be contingent on the eventual
sale of the proprietary position in equities in Kazakhstan. This
will result in a material increase of the group's capitalization,
reduce its concentration risk, and materially reduce its dependency
on the availability of repurchase facilities. S&P could also
upgrade the group if it notes a material buildup of capital on the
back of improved profitability, which would somewhat reduce risk
exposures on a relative basis. However, S&P considers this scenario
remote at this stage.

A negative rating action would likely stem from the
underperformance of the equity market in Kazakhstan, resulting in
losses for Freedom KZ and the group as a whole. S&P may also lower
the ratings if it sees liquidity becoming unavailable or a material
increase in proprietary positions in equities.

  RATINGS LIST

  New Rating
  Freedom Finance JSC

   Issuer Credit Rating
   Kazakhstan National Scale kzBB-/--/--
  
  New Rating; Outlook Action
  Freedom Finance JSC

  Investment Company Freedom Finance limited liability company
  Issuer Credit Rating   B-/Stable/B


SAMRUK-KAZYNA: S&P Affirms 'BB+/B' Issuer Credit Ratings
--------------------------------------------------------
S&P Global Ratings said that it had affirmed its 'BB+/B' long- and
short-term issuer credit ratings on Kazakh government holding
company Samruk-Kazyna. The outlook is stable.

S&P also affirmed its 'kzAA+' Kazakhstan national scale rating on
Samruk-Kazyna and its 'BB+' issue rating on the company's senior
unsecured debt.

The affirmation reflects that S&P continues to see an almost
certain likelihood of Samruk-Kazyna receiving extraordinary support
from the government of Kazakhstan (BBB-/Stable/A-3), its sole
shareholder, in case of need, owing to our view of
Samruk-Kazyna's:

-- Critical role for the government as the main vehicle for
implementing its agenda for strategic industrialization and
long-term economic sustainability and diversification.

-- Integral link with the government, which is the company's sole
shareholder.

S&P said, "Although we assess the likelihood of extraordinary
government support for Samruk-Kazyna as almost certain, our
long-term rating on the company continues to be one notch below
that on Kazakhstan, due to our concerns that Kazakhstan's
willingness to support the government-related sector is subject to
transition risk. Our view is supported by the authorities'
comparatively limited involvement in ensuring timely payment of the
obligations of railway company Kazakhstan Temir Zholy, a key
subsidiary of Samruk-Kazyna. The ratings on Samruk-Kazyna
incorporate several notches of support, resulting in higher ratings
than its stand-alone creditworthiness would warrant. We assess
Samruk-Kazyna's underlying credit quality, absent extraordinary
government support, in the 'b' category."

Samruk-Kazyna must be 100% owned by the government by law. In 2015,
the government announced plans to privatize some of Samruk-Kazyna's
assets, including those in the energy, mining, and transport
sectors, to attract foreign direct investment and stimulate
economic growth. The privatization list features some 215 entities
owned and operated by Samruk-Kazyna. The largest of its
subsidiaries--AirAstana, Kazatomprom, Kazakhtelecom, KazMunayGas,
Kazakhstan Temir Zholy, Samruk-Energy, and Kazpost--are targeted
for IPO. According to government plans, a 15%-25% share of those
companies is to be floated on the Astana stock exchange by 2020.

S&P said, "In our view, Samruk-Kazyna still benefits from adequate,
ongoing support from the government through concessional budget
loans and regular capital injections from the budget, particularly
when the company has been asked to implement a government
investment project that might otherwise result in a deterioration
of its financial standing.

"The stable outlook on Samruk-Kazyna reflects that on Kazakhstan.
We would likely change our rating or outlook on Samruk-Kazyna if we
took similar rating actions on the sovereign.

"We could lower the rating on Samruk-Kazyna if we saw signs of
waning government support to the group or, more broadly, to other
government-related entities (GREs) over the next 12 months.

"We could raise the rating on Samruk-Kazyna if both Kazakhstan's
monitoring of its GRE debt and the efficiency of administrative
mechanisms to provide extraordinary support to Kazakhstani GREs
improved."




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

ABLV BANK: Agrees to Commence Judicial Liquidation Process
----------------------------------------------------------
ABLV Bank Luxembourg S.A. has decided to agree to the start of the
judicial liquidation process given significant financial losses
over the extended period since March 2018 and in order to protect
the interests of the depositors and shareholders, the company noted
in a press release.

Luxembourg's financial supervisory authority, Commission de
Surveillance du Secteur Financier (CSSF), has in fact filed an
application with the Luxembourg Commercial Court in order to put
ABLV Bank Luxembourg, S.A. into judicial liquidation.

The Luxembourg Commercial Court was expected to make a decision
about lifting the previously imposed protection mechanism and
commencement of judicial liquidation and setting out its key terms
on July 2, 2019, Arvids Kostomarovs, liquidator of ABLV Bank, AS in
liquidation, said.

According to Mr. Kostomarovs, following the decisions of the
European Central Bank and the Single Resolution Board since March
2018, the bank in Luxembourg has been losing about EUR250,000 every
month.  The money deposited with the bank is not available to its
depositors for more than a year, as well as mutually acceptable
agreement on the conclusion of acquisition of the bank by Duet
Group Limited has not been reached.

"The best solution in this situation is to lift the protection
mechanism imposed on the bank more than a year ago and start the
liquidation process.  Currently, this is the best decision in the
interests of all parties including depositors, and us as the
shareholder," Mr. Kostomarovs comments on the decision made by ABLV
Bank, AS in liquidation to support the application filed.

Right now the bank in Luxembourg is capable of covering all the
liabilities to its clients to 100%.  Its financial standing is
stable and complies with all the liquidity and other indicators set
forth by the regulator.  More information for the Luxembourg bank
clients about further steps to take shall be provided after the
court decision is made, the company said.

Previously, on February 19, 2018, the CSSF filed an application to
put the bank under the protection of the suspension-of-payments
status.  On February 23, 2018, the Single Resolution Board decided
that ABLV Bank in Riga and ABLV Bank Luxembourg should be
liquidated in accordance with the local legislation and on February
26, 2018, the Luxembourg Resolution Board decided upon the
liquidation of ABLV Bank Luxembourg. Accordingly, on February 27,
the CSSF filed a double application asking the Luxembourg
Commercial Court either for the liquidation of the bank or for the
suspension-of-payments regime.  On March 9, 2018, Luxembourg
Commercial Court dismissed the request about the liquidation of
ABLV Bank Luxembourg considering that there were not enough
evidence provided about the poor financial standing of the bank.
The court however admitted the second request and ruled to appoint
two external administrators and keep the bank under the protection
of the suspension-of-payments status that has been extended three
times.

ABLV Bank Luxembourg, S.A. has been operating since 2013 and
employs about 20 people.


AI AQUA: S&P Affirms 'B' Issuer Credit Rating, Outlook Negative
---------------------------------------------------------------
S&P Global Ratings affirming all of ita ratings on AI Aqua Sarl,
including its 'B' issuer credit rating, its 'B' issue-level rating
on the company's $115 million senior secured first-lien revolving
credit facility maturing in 2021 (undrawn at the close of the
proposed transaction), its 'B' issue-level rating on its first-lien
term loans maturing in 2023 (including its existing $630 million
U.S. term loan [about $620 million drawn], a new $70 million
incremental U.S. first-lien term loan, and a $345 million
Australian first-lien term loan [about $340 million drawn]), and
our 'CCC+' issue-level rating on its $235 million senior secured
second-lien term loan maturing in 2024.

The affirmation with a negative outlook reflects the company's
still high leverage because it remains very acquisitive. This has
led to continued debt increases and higher-than-expected
integration expenses, which have prevented it from increasing its
EBITDA to its original pro forma estimates from prior acquisitions
and kept its free operating cash flow (FOCF) generation from
turning positive. Therefore, AI Aqua's debt to EBITDA remains above
8.0x pro forma for the 12 months ended March 31, 2019 (compared
with our expectation for leverage of well below 8.0x). Moreover,
S&P doesn't expect the company's FOCF to turn positive until fiscal
year 2019, which compares with our prior expectation for positive
annual FOCF of more than $50 million in fiscal year 2018. Although
we expect AI Aqua's leverage to meet S&P's expectations by the end
of fiscal year 2019, any operational missteps or additional
unforeseen operating charges (including for future mergers and
acquisitions [M&A]) that prevent the company from reducing its
leverage below 8.0x would likely lead to a downgrade.

The negative outlook on AI Aqua reflects the risk of a downgrade in
the next few quarters if the company doesn't reduce its debt to
EBITDA below 8.0x.

S&P said, "We could lower our rating on AI Aqua if it pursues
additional debt-funded acquisitions while its transaction costs
remain higher than expected. We estimate that if the company spends
an incremental $100 million on debt-fund acquisitions while its
integration and transaction costs remain near $50 million its
leverage will stay above 8x well into fiscal year 2020.

"We could revise our outlook on AI Aqua to stable if it
successfully integrates its acquisitions and reduces its leverage
closer to 7x. In addition to integrating its recent acquisitions
and reducing its leverage with a full year of EBITDA contributions
from its acquired businesses, we would also expect the company to
achieve its annual FOCF to near or above $50 million before
revising our outlook to stable."


AURIS LUXEMBOURG II: Fitch Assigns B LongTerm IDR, Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has assigned Auris Luxembourg II S.A. a Long-Term
Issuer Default Rating of 'B'. The Outlook is Stable. Fitch has also
assigned Auris Luxembourg III S.a.r.l. senior secured debt a final
rating of 'B+' with a Recovery Rating of 'RR3'.

The rating actions follow the completion of Sivantos merger with
Widex after approval from the relevant authorities in February
2019, as well as the finalisation of debt documentation conforming
to information previously received. The newly incorporated WS
Audiology A/S is the result of a merger between Sivantos' and
Widex's legacy businesses, with Auris Luxemburg II acting as a
consolidating entity. At the same time all ratings on Lux Midco
S.a.r.l. have been withdrawn due to a corporate reorganisation of
the combined group.

While Sivantos performed satisfactorily in 1Q for financial year
ending September 2019 Fitch expects to discuss with management the
consolidated financial year-end performance of the combined entity
- given the different year-end for Widex (April 2019) - as well as
progress on integration and an update on strategic developments
post-merger.

The expected rating of 'B(EXP)' related to Lux Midco S.a.r.l. has
been withdrawn due to reorganisation of the rated entity.

KEY RATING DRIVERS

Clear Merger Rationale: The ratings continue to reflect the
combined group's solid business profile as one of the top three
players in the global hearing aid industry, and the strategic
rationale for the merger supported by their complementary market
positions and distribution strengths. Sivantos features a leading
online retail channel and enjoys a strong wholesale position in
core countries such as the U.S., France, China and Japan. Widex is
a wholesaler with a broad global retail footprint. Post-merger, the
company will have one of the highest R&D spending programmes in the
sector.

Structural Trends Drive Growth: The global hearing aid industry's
rapid evolution and consistent growth over the past 15 years is
manifested by sales growth of around 5% annually and resilience
throughout the cycle, despite the sector's predominantly
discretionary spending nature. An expanding customer base driven by
a higher percentage of hearing-impaired individuals adopting the
device solution reflects ongoing demographic shifts in advanced
economies towards an ageing population with a longer life
expectancy.

Moderate Execution Risks: Management expects to unlock synergies
via the rationalisation of the wholesale and retail units and also
in procurement, manufacturing and overheads. The plan has been
subject to thorough due diligence, highlighting total savings of
about EUR100 million. Fitch conservatively assumes that single-line
items will achieve 60% of targeted synergies with some time lags in
implementation.

Challenges by OTC, Consumer Electronics: Discretionary spending for
hearing aids makes it exposed to potentially alternative
consumer-led initiatives, including OTC sales and branded consumer
electronic companies. However, OTC offering has not yet gained
market traction due to poor service quality, restricting the offer
to value-for-money devices. Similarly, potential threats from
consumer electronics manufacturers do not appear imminent as there
is little visibility on their respective R&D activity.

Robust Cash Flow Profile: High profit margins, low cash absorption
from working capital and reasonable capex requirements result in a
high cash-generating business profile. Its rating case projects
Fitch-defined free cash flow (FCF) of between 5% and 6% of revenue
in FY20 and FY21, where the achievement of meaningful synergies
will be a key contributing factor. The cash generation profile is
in line with that of higher-rated U.S. medical products companies
such as Baxter International Inc. (A-/Stable) and Becton, Dickinson
& Company (BBB-/Stable), and should help support a steady
deleveraging profile.

High Leverage, Deleveraging Potential: Fitch calculates funds from
operations (FFO)-adjusted gross leverage at 9.3x and total
debt-to-EBITDAR at 8.2x in FY19 (pro-forma for Widex), which is
higher than most industry peers'. Fitch also views the financial
structure as aggressive, acting as a major rating constraint. Nidda
Bondco GmbH (B/ Stable) (expected FY19 FFO-adjusted gross leverage
above 9.0x) is the closest healthcare-related peer in terms of high
leverage. Its rating case forecasts the combined entity to
deleverage to FFO-adjusted gross leverage of 7.2x in FY22, a level
that would be more adequate for its rating, accompanied by
reasonable financial flexibility stemming from solid FCF
capabilities, strong liquidity and a low debt-service burden.

DERIVATION SUMMARY

WS Audiology A/S has a solid business risk profile and
profitability, which are consistent with a mid-to-high 'BB' rating
in the medical devices sector. This is in line with Synlab
Unsecured Bondco PLC (B/Stable) and Nidda BondCo GmbH (B/Stable),
but stronger than 3AB Optique Developpement S.A.S. (B/Stable).
Nevertheless, the 'B' rating reflects the highly-leveraged capital
structure, which constrains the rating, as for Nidda Bondco and
Synlab.

While Synlab's revenue growth is limited by structural pressures on
pricing in its core laboratory testing business, which is
counterbalanced by adequate volume growth, the merged
Sivantos/Widex will feature revenue growth in mid-single digits and
achievable cost savings. This should result in a pro forma EBITDA
margin of at least 23%, ahead of Synlab's expected EBITDA margin
below 20%. Fitch expects Sivantos/Widex to have a comfortable
deleveraging profile, despite starting on higher FFO-adjusted
leverage (9.3x) than Synlab's current leverage above 8x (pro forma
for latest announced refinancing).

KEY ASSUMPTIONS

Fitch's Key Assumptions within its Rating Case for the Issuer

  - Wholesale and retail revenue to grow 4%, with 1%-2% driven by
retail acquisitions (FY18-FY22: 5.8% CAGR)

  - 10% CAGR in EBITDA led by revenue growth and margin
improvements, and an average EBITDA margin of 24%

  - EUR64 million synergies (ie, 61% of management plan) fully
materialising by FY23

  - EUR93 million of cumulative cash outflow from working capital
over FY18-FY22, averaging EUR18 million per annum

  - Approximately EUR450 million of combined capex over FY18-FY22

  - No dividends or major M&A

Key Recovery Assumptions

The recovery analysis assumes that the merged group would be
considered a going concern in bankruptcy, and that it would be
reorganised rather than liquidated, given the inherent value behind
its product portfolio, brands, retail network and clients. Fitch
has assumed a 10% administrative claim.

Fitch assesses the group's going concern EBITDA at approximately
EUR300 million, which is 15% below its pro forma EBITDA estimate
for the combined group. A distressed situation may arise from an
adverse market change driven by entirely new technologies or by
more aggressive value-for-money pricing proposals which, against a
backdrop of Sivantos/Widex's highly leveraged balance sheet, could
create a forced restructuring of the group. The going concern
EBITDA estimate reflects Fitch's view of a sustainable,
post-reorganisation EBITDA upon which Fitch bases the valuation of
the group.

Fitch uses an enterprise value/EBITDA multiple of 6.5x. This is at
the high-end of the range of multiples used for other
healthcare-focused credit opinions and ratings in the 'B' category,
recognising a partial uplift led by the synergistic potential of
the combined entities as well as the scale factor.

After deducting 10% for administrative claims, its waterfall
analysis generated a ranked recovery in the 'RR3' band, indicating
a 'B+' instrument rating for the senior secured term loan B (TLB)
and revolving credit facility (RCF), which ranks pari passu with
the TLB, and Fitch assumes to be fully drawn upon default. The
waterfall analysis based on current metrics and assumptions yields
recoveries of 56% for the senior secured debt.

RATING SENSITIVITIES

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

  - Evidence of successful implementation of merger and delivery of
synergies-led margin improvement

  - FFO fixed charge cover of 2.5x or above

  - FCF margin sustainably above 5%

  - FFO-adjusted gross leverage below 7.0x on a sustained basis, or
evidence of clear deleveraging and achievement of the mentioned
sensitivities

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

  - FFO fixed charge cover below 2.0x

  - FCF margin lower than 5% through the cycle on a sustained
basis

  - Meaningful delays in merger and synergies savings
implementation resulting in FFO-adjusted gross leverage remaining
above 8.0x beyond 2020

LIQUIDITY AND DEBT STRUCTURE

Comfortable Liquidity: Auris Luxembourg II S.A. has an available
EUR240 million of revolving credit facility. Fitch believes this
amount, along with its expectation of positive FCF, will be
sufficient to cover operational requirements, mainly derived from
working capital needs. In addition, the new debt structure includes
only long-term loans, with maturities ranging from 6.5 to eight
years.




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

ALGECO INVESTMENTS: Moody's Affirms B2 CFR, Outlook Stable
----------------------------------------------------------
Moody's Investors Service affirmed Algeco Investments B.V.'s B2
corporate family rating. Concurrently, the rating agency affirmed
the B2 rating for the EUR685 million 6.5% fixed rate backed senior
secured notes, the B2 rating for the EUR190 million backed senior
secured floating rate notes, and the B2 rating for the USD520
million 8.0% backed senior secured fixed rate notes, all issued by
Algeco Global Finance PLC. The rating for the USD305 million 10.0%
backed senior unsecured notes issued by Algeco Global Finance 2 Plc
was affirmed at Caa1. The outlook on the issuers remains stable.

The affirmations of the B2 senior secured debt ratings and the Caa1
senior unsecured debt rating reflect Algeco's B2 CFR and the
results of Moody's Loss Given Default for Speculative-Grade
Companies analysis (LGD model) and the priorities of claims and
asset coverage in the company's capital stack.

Moody's has also withdrawn the outlooks on Algeco's existing
instrument ratings for its own business reasons. The withdrawal of
these outlooks has no impact on the issuer-level rating outlook for
Algeco.

RATINGS RATIONALE

The affirmation of the B2 CFR reflects (i) Moody's expectation that
Algeco's return on assets and interest coverage will remain weak in
2019, but experience an improving trend over the next 12-18 months;
(ii) Moody's expectation that Algeco's high gross leverage will
come down below 6x over the next 24 months from 6.8x at the end of
2018; (iii) Moody's view that Algeco's elevated levels of
on-balance sheet liquidity is a credit positive driver, with cash
comprising 22% of tangible assets at the end of March 2019 and
shares in Target Hospitality Corp (Arrow BidCo LLC; B1 CFR)
accounting for further 11% of tangible assets, partially offsetting
the high gross leverage; and (iv) negative levered free cash flow
that Moody's expect will turn positive over the next 12-18 months.

Furthermore, the B2 CFR takes into account Moody's view of the
operating environment of Algeco, including the agency's view on the
modular space lessor industry. Moody's view the overall sector as
having low barriers to entry, with limited pricing power of
individual firms operating within the sector. Nevertheless, because
Algeco is the largest incumbent by some distance in most markets it
operates and no competitor has a similar geographic presence, the
rating agency accounts for this franchise strength in the CFR.

The affirmation of the debt ratings also takes into account Moody's
LGD model by assessing the priorities of claims and asset coverage
in Algeco's liability structure. Moody's rates the senior secured
debt in line with the B2 CFR owing to the debt being secured on a
first lien basis by all shares in material subsidiaries in Germany
and France, as well as bank accounts of Algeco and certain other
subsidiaries. The senior secured note holders also have a second
lien claim behind Algeco's ABL facility creditors on assets in
Australia, New Zealand, and the United Kingdom. The Caa1 backed
senior unsecured debt rating reflects that the senior unsecured
creditors are subordinated to secured creditors and the rating
agency expect limited recovery in the event of default.

RATIONALE FOR THE STABLE OUTLOOK

The rationale for the stable outlook is that Moody's expect that
Algeco's financial performance will improve over the outlook
period; however, the rating agency expects that Algeco's standalone
credit profile will remain in line with that of its B2 CFR over the
next 12-18 months.

WHAT COULD CHANGE THE RATINGS UP / DOWN

Moody's could upgrade Algeco's CFR if the company (i) stabilise
profitability metrics, with return on assets consistently above 3%
and EBITDA / interest expenses above 3x; (ii) continue its
deleveraging so that debt / EBITDA is maintained below 4x; and/or
(iii) generate stable positive levered free cash flows. An upgrade
to the CFR would likely result in an upgrade to all ratings.

Conversely, Moody's could downgrade Algeco's CFR if the company (i)
is unable to improve its cash flow generation; (ii) fails to
deliver sustainable profitability; and/or (iii) is unable to
deleverage, maintaining gross leverage above 6.5x while consuming
its cash balances.

Moody's could also change the debt ratings if there are material
changes to the liability structure that increase or decrease
expected recoveries in a default scenario.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Finance
Companies published in December 2018.

FULL LIST OF AFFECTED RATINGS

Issuer: Algeco Investments B.V.

Affirmations:

Long-term Corporate Family Rating, Affirmed B2, Outlook Withdrawn
Previously Stable

Outlook Action:

Outlook Remains Stable

Issuer: Algeco Global Finance 2 Plc

Affirmations:

Backed Senior Unsecured Regular Bond/Debenture, Affirmed Caa1,
Outlook Withdrawn Previously Stable

Outlook Action:

Outlook Remains Stable

Issuer: Algeco Global Finance PLC

Affirmations:

Backed Senior Secured Regular Bond/Debenture, Affirmed B2, Outlook
Withdrawn Previously Stable

Outlook Action:

Outlook Remains Stable




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

PETERSBURG SOCIAL: Moody's Affirms B2 Deposit Ratings
-----------------------------------------------------
Moody's Investors Service affirmed the B2/Not Prime long-term and
short-term local and foreign currency deposit ratings of Petersburg
Social Commercial Bank (PSCB) and changed the outlook on the
long-term deposit ratings to positive from stable. Concurrently,
Moody's affirmed the bank's b2 Baseline Credit Assessment (BCA) and
adjusted BCA. Moody's also affirmed PSCB's B1(cr)/Not Prime(cr)
long-term and short-term Counterparty Risk Assessment (CR
Assessment) and its B1/Not Prime long-term and short-term local and
foreign currency Counterparty Risk Ratings.

RATINGS RATIONALE

The positive outlook on PSCB's ratings reflects the bank's improved
capital and liquidity profiles. The rating action is also
underpinned by PSCB's stable asset quality and good profitability.
The main factors constraining PSCB's ratings are its niche business
model and lack of business diversification, as well as the bank's
reliance on the predominantly short-term and concentrated corporate
funding.

Capital adequacy level represents PSCB's key credit strength. As of
31 December 2018, the bank's adjusted ratio of tangible common
equity to risk-weighted assets improved to 24.9% (well above the
system average) from the 15.1% ratio reported as of the end of
2017. PSCB's capital adequacy is further underpinned by good profit
generation, with the bottom-line financial result benefitting from
a strong inflow of fees and commissions and low credit costs.

Moody's expects that PSCB will maintain good asset quality over the
next 12 to 18 months. As at 31 December 2018, the aggregate share
of PSCB's individually and collectively impaired loans remained low
at 2.1% of total gross loans, down from 2.7% a year earlier. Loans
defined as Stage 3 loans (as reported under IFRS 9) were 7.3% of
the total gross loans as of the end of 2018. As of the same
reporting date, loan-loss reserves accounted for 11.5% of total
gross loans and more than 1.5x covered Stage 3 loans. At the end of
2018, PSCB's net loan portfolio accounted for only 14% of total
assets, other assets held in a more liquid form, such as cash and
cash equivalents, as well as high-quality fixed income securities.

PSCB is wholly deposit funded; however corporate deposits, which
account for 69% of total customer funding as of 31 December 2018,
are largely represented by short-term and concentrated customer
accounts and hence are more volatile by nature. At the same time,
the share of term deposits in total customer funding is growing,
having increased to 29% as at 31 December 2018 from 24% a year
earlier. Risks of significant customer funds outflows are mitigated
by the bank's ample liquidity cushion which -- at 31 December 2018
-- accounted for approximately 80% of PSCB's balance sheet. The
most liquid cash and cash equivalents historically made up between
30% and 50% of PSCB's total liquid assets, and Moody's expects the
bank to remain highly liquid in the next 12 to 18 months, because
of the specifics of its business model.

PSCB's dependence on its niche business and lack of business
diversification are the main factors that continue to constrain the
bank's ratings. The concentration of PSCB's business on payment
services and treasury operations renders its financial performance
vulnerable to the specific risks inherent to these niche segments.
Any adverse changes in the market conditions, as well as operating
and regulatory environment in Russia (for example, changes in
interest rates dynamics, tighter regulation in the payment services
area and increased competition on the part of other players,
including non-bank fintech entities) may impair the bank's market
franchise and its profitability metrics. In particular, Moody's
considers the Instant Payment System (IPS) launched by the Central
Bank of Russia in April 2018 to become, over time, a strong
competitor to PSCB's niche business. The IPS aims to involve all
major bank players by the end of 2018 and to develop and provide,
through these banks, innovative, convenient and cheaper payment
solutions to consumers of financial services in Russia.

WHAT COULD MOVE THE RATINGS UP / DOWN

Moody's may upgrade PSCB's BCA and deposit ratings in the next
12-18 months if the bank demonstrates its ability to counter the
competition challenges relating to its business model, solidify its
franchise and diversify its product mix while demonstrating
sustainable good financial performance.

PSCB's ratings could be downgraded, or the rating outlook might be
revised back to stable, in case the bank loses its competitive
advantage as an operator of its universal payment service, which
could weaken its profits generation. A downward pressure on PSCB's
ratings could also arise as a result of a material weakening of the
bank's financial performance and loss-absorption capacity, or in
case of materialisation of liquidity risks.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks published
in August 2018.

Headquartered in Saint-Petersburg, Russia, PSCB reported -- at
year-end 2018 - total assets of RUB28.0 billion and total
shareholders' equity of RUB3.4 million under its audited IFRS. The
bank's IFRS profits for 2018 was RUB462 million.

LIST OF AFFCTED RATINGS

Issuer: Petersburg Social Commercial Bank

Affirmations:

Long-term Bank Deposits, Affirmed B2, Outlook Changed To Positive
From Stable

Short-term Bank Deposits, Affirmed NP

Adjusted Baseline Credit Assessment, Affirmed b2

Baseline Credit Assessment, Affirmed b2

Long-term Counterparty Risk Assessment, Affirmed B1(cr)

Short-term Counterparty Risk Assessment, Affirmed NP(cr)

Long-term Counterparty Risk Ratings, Affirmed B1

Short-term Counterparty Risk Ratings, Affirmed NP

Outlook Action:

Outlook Changed To Positive From Stable


SAFMAR FINANCIAL: S&P Hikes Longterm Rating to 'BB-'
----------------------------------------------------
S&P Global Ratings raised its long-term rating on Safmar Financial
Investments (SFI) to 'BB-' from 'B+' and affirmed its 'B'
short-term rating.

S&P said, "We upgraded SFI given our view of a gradual improvement
in the credit quality of its investments. Additionally, SFI has
built up a zero-leverage track record, and some additional
diversification in its investment portfolio with the addition of
Direct Credit Centre (DCC).

"That said, our ratings are still constrained by SFI's limited
portfolio size (about $1.3 billion) and diversification, and its
sole exposure to the economic and business development in Russia
(foreign currency BBB-/Stable/A-3; local currency BBB/Stable/A-2).
"We expect SFI will continue to operate without any meaningful debt
amounts. However, we note that SFI has a limited track record of
operations, and no portfolio turnover, given that the holding was
established in 2017."

The credit quality of the investees is supported by resilience of
its leasing segment Europlan in 2018-2019. Europlan is showing
strong operational results and leveraging its expertise and
business model on the Russian leasing market. Additionally,
Europlan has a limited cost of risk that is lower than the system
average for auto leasing. This enables Europlan to upstream sizable
dividends to SFI.

S&P said, "We also note that SFI completed the planned merger of
its pension funds (Safmar and Doverie) in March 2019, impaired
assets in the portfolio, and reallocated investments to higher
quality assets. We believe that this conservative move, together
with recent changes in regulation stipulating flat fees for
non-state pension funds, reduces potential volatility in profits in
future periods and should support dividend capacity.

"In addition, SFI's investment in insurer JSC VSK brought dividend
income in 2018 and 2019. While capitalization seems to be a
relative weakness (partly due to dividends to shareholders), we
note an improvement in VSK's weighted average credit quality and
investment portfolio concentrations. In 2018, the company had to
create extra reserves due to a significant one-off loss. We
currently understand that the case was resolved successfully with
no pressure on VSK's regulatory ratios, and the reserve was
reversed in 2019.

"We continue to believe that the group's investment activities are
critical to SFI's underlying credit quality, given that SFI does
not perform any operations outside management of liquidity on its
balance sheet. We believe none of the investees are core to SFI,
and we therefore expect SFI would dispose of assets to meet debt
obligations if needed.

"In our view, SFI's investment position is constrained by the
substantial portfolio concentration of its assets in Russia. Its
portfolio now contains four holdings, which is less than most
peers', and these show significant concentration in Russia's
financial sector. Furthermore, all investments are unlisted, which
is atypical for investment holding companies. We expect that,
because of this, it will take a longer time for SFI to dispose of
assets if needed. SFI's controlling stakes in three out of four
companies also weigh on our assessment of its business risk. In
addition, we believe the company still has a limited track record
of turning over assets and investing in new ones. We understand,
however, from SFI's strategy that management intends to continue
broadening its investment portfolio, and we therefore expect
diversification to increase.

"We expect SFI will continue to have low financial risk, given its
lack of debt and strong liquidity position. We also view SFI's
investment strategy, which stipulates zero debt, as positive for
the rating, since it supports our view of no debt going forward.

"Of the four holdings, only Europlan and DCC can freely distribute
dividends. We expect Safmar to be able to pay dividends from 2019
(before it was restricted by the regulator), and VSK has regulatory
capital ratios with which it has to comply, but we expect the
company to continue to pay dividends."

SFI is ultimately controlled by members of the Gutseriev family,
Russian businessmen with investments in oil and gas, coal mining,
chemical fertilizers, commercial and residential real estate,
hotels, retail, and media. S&P said, "We understand that the
shareholders are not involved in the day-to-day management of the
company. We exclude their other businesses in our analysis, since
they are not controlled by SFI. At the same time, we note overall
complexity of the larger Safmar group, but in our view this does
not currently influence the ratings on SFI."

S&P said, "The stable outlook is based our view that SFI will
continue to run with no or very limited leverage, the credit
quality of its investments will remain at current levels, dividend
inflows will cover dividends to shareholders in line with the
dividend policy, and SFI may consider small acquisitions in the
Russian financial services sector.

"At the moment, we see upside for SFI as limited, considering the
average quality of its investments, limited diversification, and no
listed assets. We could consider positive rating actions if we see
a material improvement in the liquidity of SFI's investees
(companies becoming listed), and if we see more industrywide and
geographic diversification for SFI."

S&P would likely take a negative rating action if:

-- S&P forecasts a sizable increase in leverage at SFI, with the
loan to value (LTV) ratio increasing.

-- S&P sees deterioration in the credit quality of subsidiaries,
leading to restricted capacity to upstream dividends to SFI.

-- SFI sells any of the portfolio companies, without an imminent
investment in an entity with similar characteristics.




===============
S L O V E N I A
===============

NOVA KREDITNA: Fitch Revises Outlook on BB+ LT IDR to Positive
--------------------------------------------------------------
Fitch Ratings has revised Nova Kreditna Banka Maribor's and Abanka
d.d.'s Outlook to Positive from Stable. Fitch has also affirmed the
banks' Long-Term Issuer Default Ratings at 'BB+' and Viability
Ratings at 'bb+'.

The rating action follows the announcement by NKBM on June 20, 2019
that it has signed a sale and purchase agreement with the Slovenian
Sovereign Holding for the acquisition of 100% of the shares of
Abanka. The completion of the acquisition is subject to regulatory
and other necessary approvals. According to NKBM management, the
merger of the two banks is expected shortly after the sale is
completed and transfer of Abanka's ownership to NKBM. The
acquisition of Abanka is significant for NKBM in terms of size as
it would increase its total assets and risk-weighted assets (RWA)
by around 70%.

The Positive Outlook for NKBM reflects Fitch's expectation that the
material strengthening of the bank's franchise following successful
acquisition of and integration with Abanka, coupled with further
improvements in asset quality and maintenance of solid
capitalisation would likely lead to an upgrade of NKBM's ratings.

Abanka's Positive Outlook reflects Fitch's view that following the
acquisition by NKBM and progress with the integration of the two
banks, Abanka's and NKBM's credit profiles will become aligned
given the plan to merge the two banks.

KEY RATING DRIVERS

IDRS and VRS

NKBM's and Abanka's IDRs are driven by the respective banks'
standalone financial strength as expressed by the banks' VRs.

Abanka's acquisition by NKBM and subsequent merger, if completed
will create the second-largest bank in Slovenia with a market share
of around 22.5% (based on end-2018 data), only marginally smaller
than the domestic operations of Slovenia's largest bank Nova
Ljubljanska Banka d.d. (NLB, BB+/Stable).

Fitch believes that the acquisition of Abanka fits well with NKBM's
strategy given the banks' largely complementary businesses and
geographical presence in Slovenia. Fitch believes building critical
mass is an important factor for sustainable performance in
competitive markets such as Slovenia, where lending growth is
moderate and interest rates are low. Benefits from the stronger
franchise are likely to have a positive impact on its assessment of
the merged bank's company profile, which however will take time to
benefit the bank's performance given likely integration costs.
Execution risks related to the acquisition and integration process
are significant given the size of the two banks. However, these
risks are mitigated by NKBM's record of acquisitions and the
integration of two other banks in Slovenia as well as by Abanka's
record of integration with Banka Celje.

In its view the impact of the transaction on NKBM's capitalisation
and asset quality are key rating considerations. Fitch estimates
that the transaction will have a manageable impact on NKBM's Fitch
Core Capital (FCC)/RWA ratio, with sizeable headroom over minimum
regulatory CET1 and Tier 1 requirements likely to be maintained.
Asset quality at NKBM has been on a positive trend and Fitch
expects this to continue in 2019. Abanka's acquisition should also
be positive for the combined bank's asset quality given the bank's
non-performing loan (NPL) ratio at end-2018 (4%) was significantly
better than that of NKBM (10.4%).

Fitch assumes no fresh equity injection from NKBM shareholders, and
therefore estimate the combined entity's pro-forma end-1H19 FCC/RWA
ratio at around 14% compared with around 23% at end-2018 for NKBM.
It is likely that closer to the completion of the transaction,
capitalisation will further improve with internal capital generated
by NKBM in 2H19. At the transaction close, capitalisation will also
benefit from the one-off recognition of negative goodwill, which
should bring the FCC/RWA ratio and CET1 ratio close to 16%.

Both banks have large liquidity cushions, with combined liquid
assets at around EUR3 billion at end-2018, compared with combined
customer deposits of around EUR6.7 billion and total assets of
around EUR8.7 billion. Therefore, the impact of the acquisition
payment of EUR444 million to SSH is not going to be material for
the liquidity profile of the combined entity.

SUPPORT RATINGS AND SUPPORT RATING FLOORS

The Support Rating Floors of 'No Floor' and Support Ratings of '5'
express Fitch's opinion that potential sovereign support for NKBM
and Abanka cannot be relied on. This is because the EU's Bank
Recovery and Resolution Directive, which provides a framework for
resolving banks, is likely to require senior creditors
participating in losses, if necessary, instead of or ahead of a
bank receiving sovereign support.

Fitch does not incorporate any potential support for NKBM from its
private shareholders as in the agency's view such support cannot be
relied upon in all circumstances.

RATING SENSITIVITIES

IDRS and VRS

An upgrade of NKBM's VR and IDRs would require a material
strengthening of the bank's franchise, which should be achievable
following the acquisition of Abanka. An upgrade would also be
contingent on NKBM maintaining sound capital ratios with sizeable
buffers over the required minimums, a further reduction of its
legacy NPL stock without denting capitalisation, maintaining
healthy funding and liquidity and a smooth integration of the
acquired bank.

Both bank's ratings would come under pressure if asset quality
deteriorates or if capitalisation or liquidity weakens, although
these scenarios are viewed as unlikely by Fitch.

At the completion of the legal merger Fitch expects to equalise
Abanka's IDR and VR with those of NKBM and withdraw Abanka's
ratings.

SUPPORT RATINGS AND SUPPORT RATING FLOORS

An upgrade of the SRs and an upward revision of the SRFs would
require a higher propensity of sovereign support. While not
impossible, this is highly unlikely in Fitch's view.

Upon the completion of the acquisition by NKBM Fitch will reassess
support available to Abanka. At the completion of the legal merger
Abanka's SRF and SR will be withdrawn.

The rating actions are as follows:

Nova Kreditna Banka Maribor

  Long-Term IDR: affirmed at 'BB+', Outlook revised to
  Positive from Stable

  Short-Term IDR: affirmed at 'B'

  Viability Rating: affirmed at 'bb+'

  Support Rating: affirmed at '5'

  Support Rating Floor: affirmed at 'No Floor'

Abanka d.d.

  Long-Term IDR: affirmed at 'BB+', Outlook revised to
  Positive from Stable

  Short-Term IDR: affirmed at 'B'

  Viability Rating affirmed at 'bb+'

  Support Rating: affirmed at '5'

  Support Rating Floor: affirmed at 'No Floor'




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

BANKINTER 11: S&P Affirms B- Rating on Class D Notes
----------------------------------------------------
S&P Global Ratings raised its ratings on Bankinter 11 Fondo de
Titulizacion Hipotecaria's class B and C notes and affirmed its
ratings on the class A and D notes.

S&P said, "Upon revising our structured finance sovereign risk
criteria and our counterparty criteria, we placed our ratings on
Bankinter 11's class B and C notes under criteria observation.
Following our review of the transaction's performance and the
application of these criteria, our ratings on these notes are no
longer under criteria observation.

"The rating actions follow the implementation of our revised
structured finance sovereign risk criteria and counterparty
criteria. They also reflect our full analysis of the most recent
transaction information that we have received and the transaction's
current structural features.

"The analytical framework in our revised structured finance
sovereign risk criteria assesses a security's ability to withstand
a sovereign default scenario. These criteria classify the
sensitivity of this transaction as low. Therefore, the highest
rating that we can assign to the tranches in this transaction is
six notches above the Spanish sovereign rating, or 'AAA (sf)', if
certain conditions are met.

"Under our previous criteria, we could rate the senior-most tranche
in a transaction up to six notches above the sovereign rating,
while we could rate the remaining tranches in a transaction up to
four notches above the sovereign. Additionally, under the previous
criteria, in order to rate a tranche up to six notches above the
sovereign, the tranche would have had to sustain an extreme stress
(equivalent to 'AAA' benign stresses). Under the revised criteria,
these particular conditions have been replaced with the
introduction of the low sensitivity category. In order to rate a
structured finance tranche above a sovereign that is rated 'A+' and
below, we account for the impact of a sovereign default to
determine if under such stress the security continues to meet its
obligations. For Spanish transactions, we typically use asset-class
specific assumptions from our standard 'A' run to replicate the
impact of the sovereign default scenario.

"The counterparty risk in this transaction is related to the
guaranteed investment contract (GIC) account provider and swap
provider, Banco Santander S.A. (A/Stable/A-1) and Bankinter S.A.
(BBB+/Stable/A-2), respectively. The GIC account replacement
language is in line with our current counterparty criteria. Under
our revised counterparty criteria, our collateral assessment of the
swap counterparty downgrade language is strong. Considering this
and the current issuer credit rating (ICR) on the swap provider,
the maximum supported rating on Bankinter 11's notes is 'AAA'.

"Until now, under our counterparty criteria, we were giving benefit
to the swaps in our analysis at rating levels up to our long-term
ICR on the corresponding swap counterparty, plus one notch, as the
swap documentation was not fully in line with our criteria. For
ratings above the ICR plus one notch, we modelled the basis risk as
unhedged.

"After the substitution, Bankinter (as swap provider) is now
posting collateral in euros according to option one in our previous
counterparty criteria. Therefore, Bankinter can support the maximum
potential rating on this transaction, and we can give benefit to
the swap counterparty at all rating levels. As of our previous
review, we had delinked our ratings on Bankinter 11's class A and B
notes from the swap counterparty. As of this review, we have linked
all the ratings to the swap counterparty.

"Our European residential loans criteria, as applicable to Spanish
residential loans, establish how our loan-level analysis
incorporates our current opinion of the local market outlook. Our
current outlook for the Spanish housing and mortgage markets, as
well as for the overall economy in Spain, is benign."

Below are the credit analysis results after applying S&P's European
residential loans criteria to this transaction.

  Credit Analysis Results
  
  Rating level WAFF (%) WALS (%)
  AAA        7.04      28.11
  AA         4.77       22.84
  A          3.59        14.79
  BBB         2.65        10.85
  BB          1.73     8.33
  B           1.03     6.24
  
  WAFF--Weighted-average foreclosure frequency.
  WALS--Weighted-average loss severity.

Bankinter 11's class A, B, C, and D notes' credit enhancement
remained stable because the deal has been amortizing on a pro rata
basis. Currently, the reserve fund is at target and amortizing.

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

"Our credit and cash flow results indicate that the available
credit enhancement for Bankinter 11's class A and B notes is
commensurate with 'AAA'. We have therefore affirmed our 'AAA (sf)'
rating on the class A notes and raised to 'AAA (sf)' from 'AA (sf)'
our rating on the class B notes, which was capped by our previous
sovereign criteria. In reviewing our rating on the class C notes,
our cash flow analysis indicated that our rating on this class
could withstand our stresses at a higher rating level than that
assigned. However, the rating was constrained by additional factors
we considered. First, we considered the relative position of this
class in the capital structure and its lower credit enhancement
compared to the senior notes. In addition, we considered this
class' sensitivity to our stability scenario analysis. We have
therefore raised to 'A+ (sf)' from 'A- (sf)' our rating on this
class.

"The class D notes do not pass our cash flow stresses at the 'B'
rating level. Following the application of our criteria for
assigning 'CCC' category ratings, we believe that payments on this
class of notes do not depend on favorable financial and economic
conditions. We have therefore affirmed our 'B- (sf)' rating on this
class."

  Ratings List

  Bankinter 11 Fondo de Titulizacion Hipotecaria

  Class Rating to Rating from
  B    AAA (sf) AA (sf)
  C    A+ (sf) A- (sf)

  Class Rating
  A    AAA (sf)
  D    B- (sf)


LECTA SA: S&P Cuts LongTerm Ratings to B- on Liquidity Concerns
---------------------------------------------------------------
S&P Global Ratings lowered its long-term ratings on Lecta S.A. and
its senior secured notes to 'B-' from 'B'. The recovery rating on
the notes is unchanged at '4' (45%).

The downgrade reflects the group's weaker liquidity position and
its increased vulnerability to further unexpected large working
capital outflows.

Although Lecta's trading performance is in line with S&P's
base-case expectations, the coated wood-free paper (CWF) sector is
still suffering from structural decline. Recent high-profile
defaults, such as Arjowiggins, show the pressure manufacturers
face. Credit insurers have reduced their appetite for CWF
producers. Lecta's liquidity position deteriorated materially in
the first quarter of 2019 as these changes led to large working
capital outflows.

Lecta also plans to continue to invest in higher-growth specialty
papers (such as labels), leading to high capital expenditure
(capex) over the next three years. S&P thereby expects Lecta's FOCF
generation to remain negative in 2019, 2020, and 2021. Negative
FOCF and the weakened liquidity position will materially reduce the
company's ability to absorb further unexpected adverse events.

S&P said, "Given Lecta's strong exposure to a sector that is in
structural decline, we regard its business risk profile as weak.
The rating on Lecta also reflects our view that the group's
financial risk profile remains highly leveraged. Its net debt to
EBITDA is forecast to remain around 6.0x-6.5x and funds from
operations (FFO) to debt to be about 8%-10% over 2019-2020.

"Our negative outlook reflects the difficult sector conditions, and
our view that Lecta's current liquidity position leaves it
vulnerable to further unexpected large cash outflows. We also
expect to see negative FOCF to debt and adjusted leverage of above
6.0x over the next 12 months.

"We would consider a downgrade if the company experienced further
unexpected large working capital outflows or if operating
performance deteriorated significantly below our base case,
resulting in a further deterioration of its liquidity position.

"We could revert the outlook back to stable if Lecta's liquidity
improved in the coming 12 months and we no longer considered it
vulnerable to material working capital or other unexpected cash
outflows. We would also expect liquidity sources to exceed
liquidity uses by more than 1.2x on a sustainable basis."


TDA IBERCAJA 4: S&P Affirms D Rating on Class F Notes
-----------------------------------------------------
S&P Global Ratings raised its credit ratings on TDA Ibercaja 4
Fondo de Titulizacion de Activos' class B, C, and D notes. At the
same time, S&P has affirmed its ratings on the class A1, A2, E, and
F notes.

S&P said, "Upon revising our structured finance sovereign risk
criteria and our counterparty criteria, we placed our ratings on
the class D and E notes under criteria observation. Following our
review of the transaction's performance and the application of
these criteria, our ratings on these notes is no longer under
criteria observation.

"The rating actions follow the application of our revised
structured finance sovereign risk criteria and counterparty
criteria. They also reflect our full analysis of the most recent
transaction information that we have received, and they reflect the
transaction's current structural features.

"The analytical framework in our revised structured finance
sovereign risk criteria assesses a security's ability to withstand
a sovereign default scenario. These criteria classify the
sensitivity of this transaction as low. Therefore, the highest
rating that we can assign to the tranches in this transaction is
six notches above the Spanish unsolicited sovereign rating, or 'AAA
(sf)', if certain conditions are met.

"Under our previous criteria, we could rate the senior-most tranche
in a transaction up to six notches above the sovereign rating,
while we could rate the remaining tranches in a transaction up to
four notches above the sovereign. Additionally, under the previous
criteria, in order to rate a tranche up to six notches above the
sovereign, the tranche would have had to sustain an extreme stress
(equivalent to 'AAA' benign stresses). Under the revised criteria,
these particular conditions have been replaced with the
introduction of the low sensitivity category. In order to rate a
structured finance tranche above a sovereign that is rated 'A+' and
below, we account for the impact of a sovereign default to
determine if under such stress the security would continue to meet
its obligations. For Spanish transactions, we typically use
asset-class specific assumptions from our standard 'A' run to
replicate the impact of the sovereign default scenario."

The servicer, Ibercaja Banco S.A., has a standardized, integrated,
and centralized servicing platform. It is a servicer for a large
number of Spanish residential mortgage-backed securities (RMBS)
transactions, and Ibercaja Banco transactions' historical
performance has outperformed our Spanish RMBS index. S&P's rating
on the class E notes is linked to its long-term issuer credit
rating (ICR) on the servicer because in its cash flow analysis it
exclude the application of a commingling loss at rating levels at
and below the ICR on the servicer.

S&P said, "The swap counterparty is Banco Santander S.A. The
remedial actions defined in the swap agreement are in line with
option one of our previous counterparty criteria. Additionally, we
assess the collateral framework under our new criteria as strong.
Based on the combination of the replacement commitment and the
collateral posting framework, the maximum supported rating in this
transaction is 'AAA (sf)'.

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

Below are the credit analysis results after applying S&P's European
residential loans criteria to this transaction.

  WAFF And WALS Levels
  Rating level WAFF (%) WALS (%)
  AAA         17.73  17.45
  AA         12.26  13.55
  A              9.25   8.30
  BBB             6.91   5.80
  BB              4.60   4.22
  B               2.80   2.97

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

Although the notes are paying pro rata, the class A1, A2, B, C, D,
and E notes' available credit enhancement has slightly increased
since S&P's previous review, due to the required reserve fund being
at its floor.

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

"The application of our revised criteria and related credit and
cash flow analysis indicates that the available credit enhancement
for the class A1 and A2 notes is still commensurate with 'AAA (sf)'
and 'AA (sf)' ratings, respectively. We have therefore affirmed our
ratings on these classes of notes. Because of the pro rata trigger
between the class A1 and A2 notes, which is based on the ratio of
outstanding defaulted assets over original balance representing
more than 4%, we expect the class A2 payments to remain
subordinated to the class A1 notes given the transaction's
historical performance.

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

"Our revised criteria indicate that the available credit
enhancement for the class E notes is still commensurate with a 'BB+
(sf)' rating. Our rating on the class E notes is linked to our
long-term ICR on the servicer, Ibercaja Banco (BB+/Stable/B), as in
our cash flow analysis we are excluding the application of a
commingling loss. We have therefore affirmed our 'BB+ (sf)' rating
on the class E notes.

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

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

  Ratings List

  TDA Ibercaja 4 Fondo de Titulizacion de Activos

  Class  Rating to   Rating from
  A1     AAA (sf)    AAA (sf)
  A2     AA (sf)     AA (sf)
  B      AA (sf)     AA- (sf)
  C      A (sf)      BBB+ (sf)
  D      BBB- (sf)   BB+ (sf)
  E      BB+ (sf)    BB+ (sf)
  F      D (sf)      D (sf)




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

DOGUS HOLDING: S&P Lowers LongTerm Rating to CCC+ on Weak Liquidity
-------------------------------------------------------------------
S&P Global Ratings lowered its long-term rating on Turkey-based
Dogus Holding A.S. to 'CCC+' from 'B-' and its Turkish national
scale rating to 'TrB+' from 'TrBB-'. Subsequently, S&P withdrew its
global scale rating, at the issuer's request.

Despite recently refinancing about EUR1 billion of debt via secured
short-term bank lines, Turkey-based investment holding company
Dogus Holding still faces very high short-term debt maturities. It
also exhibits weak liquidity and the capital structure may be
unsustainable over the medium term, in S&P's view. Management
estimates that the companies Dogus has invested in will provide
dividends of about EUR40 million a year to their parent. This will
not be enough to cover interest payments of about EUR50
million-EUR60 million in 2019 and EUR85 million-EUR100 million in
2020, and operating expenses of about EUR60 million annually.

S&P considers Dogus' average debt maturity profile to be short, at
less than two years. Dogus has EUR103 million in debt due in the
first quarter 2020, with further significant debt maturities due
across the next two years.

Management expects to pay its maturing debt by selling assets,
mostly hotels located outside Turkey. Although it has successfully
executed a number of disposals to date--including the Hilton Athens
and Capri Palace--the company is exposed to delays and pricing
risk. It continues to discuss further assets sales.

In S&P's view, positive cash flows from the sale of the remaining
assets are not certain, and will be very limited. S&P expects the
average credit profile of the investment portfolio to remain low in
the 'B' rating category.

Dogus provided adequate compensation for the recent EUR1 billion
refinancing by offering security over its real estate operations
and part of its tourism division. Given current market conditions
in Turkey, the timing of the refinancing was not propitious. The
refinancing increased nominal interest costs and extended principal
and interest payments to six years.

Dogus used real estate assets of EUR3.6 billion as security for the
refinancing, and will need to add further assets if the asset value
goes below 115% of the loan. In S&P's view, this compensates the
bank for the proposed extension of the loan maturity.

S&P sees a risk that Dogus will dispose of most of its
international assets, which would weaken its business risk profile.
Dogus has proposed selling a number of assets from its hotel
portfolio. These include Istinye Park, the Grand Hyatt Hotel, Dogus
Maslak Center, and N11.

Of necessity, Dogus' strategy will focus on asset sales in 2019 and
2020, as it will rely on the proceeds. The timing and value of sale
proceeds are subject to market risk. Its strategic alternatives may
also be limited. Some of the assets in Dogus' portfolio--for
example, the media and tourism businesses and construction--have
been underperforming for some time, in S&P's opinion. S&P now
assesses Dogus' management and governance as weak.

Turkey's economy went into recession at the end of 2018, as
confirmed by the Turkish Statistical Institute's March 11 national
accounts data release. In seasonally- and calendar-adjusted terms,
real GDP shrank 2.4% in the fourth quarter, following a 1.6%
contraction in the third. S&P still considers that Turkey is going
through a stagflationary adjustment, following last August's
currency crisis.

S&P said, "We see domestic demand as the key weakness going
forward, as investments continue to contract amid tighter
international financing conditions, and the foreign-exchange debt
burden rises due to the weaker lira and elevated lira interest
rates. We therefore expect consumption to shrink in real terms
during 2019, which will constrain valuations and cash flow
generation at domestically focused manufacturers and retailers such
as Dogus Otomotive. That said, tax incentives could somewhat
support Dogus Otomative and the weak lira should also be beneficial
for Dogus' tourism revenues.

"We estimate Dogus' loan-to-value (LTV) ratio, a measure of
leverage for investment holding companies, at above 45%. However,
we have not received an updated validation report over the past
quarter. Our LTV ratio is based on our estimate of total holding
company debt at $1 billion. Given the current volatile
macroeconomic situation in Turkey, we see a clear risk that asset
prices could have fallen. Therefore, we applied a haircut to our
estimated valuations for assets within Turkey. No haircut was
applied to assets outside Turkey.

"The refinancing process introduced a cross-guarantee mechanism
that implies that all of the EUR3.2 billion in group debt is now
guaranteed by the holding company. We consider guarantees to be
atypical for holding companies. This mechanism increases Dogus
Holding's exposure to its investee companies.

"We view the financial risk profile as highly leveraged, given the
high LTV threshold and limited cash flow adequacy. Dividend income
is minimal, at EUR40 million. The key risks are the current
short-term maturity profile and the cross-guarantees offered by the
holding company on the refinanced maturities of its investee
companies. Such guarantees are unusual among investment holding
companies and further increases the credit risk to investees.

"Although larger in U.S. dollar terms, Dogus' portfolio is weaker
than those of rated peers, such as JSC Georgia Capital. Dogus'
portfolio has few listed assets--we estimate only about 10% of the
total portfolio is listed--and high asset concentration.

"At the time of the withdrawal, the negative outlook indicated our
view that Dogus could find it difficult to execute all of its
planned asset sales. It depends on these sales to repay a
significant amount of its short-term debt before it matures.

"If Dogus could not carry through asset sales before year-end 2019,
so that it could meet upcoming debt maturity and interest payments
in 2020, we would likely have lowered the rating by one or two
notches."




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

CANTERBURY FINANCE 1: Moody's Give (P)B2(sf) Rating to Cl. C Notes
-------------------------------------------------------------------
Moody's Investors Service assigned provisional long-term credit
ratings to Notes to be issued by Canterbury Finance No. 1 PLC:

GBP[-]million Class A1 Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)Aaa (sf)

GBP[-]million Class A2 Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)Aaa (sf)

GBP[-]million Class B Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)Aa1 (sf)

GBP[-]million Class C Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)A1 (sf)

GBP[-]million Class D Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)Baa3 (sf)

GBP[-]million Class E Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)B2 (sf)

GBP[-]million Class F Mortgage Backed Fixed Rate Notes due May
2056, Assigned (P)Ca (sf)

GBP[-]million Class X Mortgage Backed Floating Rate Notes due May
2056, Assigned (P)Ca (sf)

This is the first securitisation that we have rated from OneSavings
Bank plc. The portfolio consists of UK first lien Buy-to-Let
mortgage loans originated by OSB under the Kent Reliance brand. As
of the cut-off date on April 30, 2019, the provisional portfolio
consisted of loans secured by mortgages on residential properties
located in the UK extended to [1,938] borrowers, with the current
pool balance approximately GBP[539.6] million.

RATINGS RATIONALE

Portfolio expected loss of [2.0]%. This is in line with the UK
Buy-to-Let sector average and is based on Moody's assessment of the
lifetime loss expectation taking into account: (i) historical data
available; (ii) around [95.1]% of the pool being IO loans; (iii)
borrower concentration in the pool; (iv) benchmarking with other UK
Buy-to-Let transactions; and (v) lower interest coverage ratio
compared to similar UK Buy-to-Let transactions.

MILAN CE of [13.0]%. This is in line with the UK Buy-to-Let sector
average and follows Moody's assessment of the loan-by-loan
information, taking into account the historical performance of
Moody's Buy-to-Let Overall trend, comparable originators'
historical information and the pool composition including: (i) the
weighted average current LTV for the pool of [70.6]%, which is in
line with comparable transactions; (ii) the fact that around
[95.1]% of the pool are IO loans; (iii) borrower concentration in
the pool; and (iv) benchmarking with similar UK Buy-to-Let
transactions.

At closing, a non-amortising Reserve Fund of [1.5]% of the Class A
to F notes has been established to provide credit enhancement and
liquidity support. On each interest payment date, the General
Reserve Fund will be replenished to [1.5]% with revenue receipts to
the extent available. If the General Reserve Fund balance at any
interest payment date falls below [1.25]% of the Class A to F Notes
outstanding balance, a build-up of an additional Liquidity Reserve
will be triggered. The Liquidity Reserve Fund will be sized at
[1.5]% of Class A and Class B Notes, and will cover interest
shortfalls on senior expenses and on the Class A and Class B Notes
interest (subject to PDL triggers).

Additionally, product switches and further advances lead to a
repurchase obligation by the seller.

Operational Risk Analysis: OSB acts as the servicer and originator
in the transaction. At closing, Citibank, N.A., London branch
(Aa3/(P)P-1/Aa3(cr)/P-1(cr)) is appointed as the independent cash
manager for the transaction. In order to mitigate the operational
risk, there is CSC Capital Markets UK Limited (not rated) acting as
the back-up servicer facilitator to undertake the search for a
suitable backup servicer in case the original servicer is
terminated from its role.

Payment continuity during a servicing interruption, is assisted by
the transaction documents incorporating 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 the equivalent of
[6] months. This amount of liquidity is in line with the UK RMBS
sector.

Note coupons linked to SONIA: This transaction uses Sterling
Overnight Index Average ("SONIA") as a reference rate for the Note
coupons rather than sterling LIBOR, which is more typically
referenced in UK RMBS. On each quarterly interest payment date, the
coupon on the Notes is calculated by compounding the daily SONIA
rate for the calculation period.

Interest Rate Risk Analysis: At closing, [86.2]% of the pool is
comprised of fixed-rate loans, which will revert to OSB's
discretionary SVR rate. The fixed-floating risk between the
fixed-rate loans and the Compounded SONIA due under the Notes is
hedged via an interest rate swap with Lloyds Bank Corporate Markets
plc (A1/P-1/A1(cr)/P-1(cr)). The swap notional follows a scheduled
amortization under a [2.0]% constant prepayment rate ("CPR")
assumption. As the realized prepayment rate of the loans could
differ from the CPR used to calculate the swap amortization, the
transaction is exposed to potential under or overhedging. In our
analysis, we have tested the structure under various CPR
assumptions. Given the issuer pays the fixed leg, the swap
structure can lead to a yield compression when the floating rate
received is below the fixed rate. This yield compression increases
further when the pool balance amortises faster than the swap
notional. At closing, the remaining [13.8]% of the pool is
comprised of floating-rate loans linked to OSB's discretionary SVR
rate and the proportion of floating rate loans will increase over
time as fixed rate loans revert to SVR. As is the case in many UK
RMBS transactions, this basis risk mismatch between the floating
rate on the underlying loans and the floating rate on the notes
will be unhedged. Moody's has applied a stress to account for the
basis risk, in line with the stresses applied to the various types
of unhedged basis risk seen in UK RMBS.

Moody's issues provisional ratings in advance of the final sale of
securities, but these ratings represent only Moody's preliminary
credit opinions. Upon a conclusive review of the transaction and
associated documentation, Moody's will endeavour to assign
definitive ratings to the Notes. A definitive rating may differ
from a provisional rating. Other non-credit risks have not been
addressed but may have a significant effect on yield to investors.

The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
June 2019.

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

FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS:

Significantly, different loss assumptions compared with our
expectations at close, due to either a change in economic
conditions from our central scenario forecast or idiosyncratic
performance factors would lead to rating actions. For instance,
should economic conditions be worse than forecast, the higher
defaults and loss severities resulting from a greater unemployment,
worsening household affordability and a weaker housing market could
result in a downgrade of the ratings. 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.


CIFC EUROPEAN I: Moody's Gives (P)B2 Rating to EUR12MM Class F Debt
-------------------------------------------------------------------
Moody's Investors Service announced that it has assigned the
following provisional ratings to notes to be issued by CIFC
European Funding CLO I Designated Activity Company:

EUR2,000,000 Class X Senior Secured Floating Rate Notes due 2032,
Assigned (P)Aaa (sf)

EUR248,000,000 Class A Senior Secured Floating Rate Notes due 2032,
Assigned (P)Aaa (sf)

EUR28,500,000 Class B-1 Senior Secured Floating Rate Notes due
2032, Assigned (P)Aa2 (sf)

EUR11,500,000 Class B-2 Senior Secured Fixed Rate Notes due 2032,
Assigned (P)Aa2 (sf)

EUR28,000,000 Class C Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)A2 (sf)

EUR24,000,000 Class D Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)Baa3 (sf)

EUR20,000,000 Class E Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)Ba2 (sf)

EUR12,000,000 Class F Senior Secured Deferrable Floating Rate Notes
due 2032, Assigned (P)B2 (sf)

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

RATINGS RATIONALE

The rationale for the ratings is based on a consideration of the
risks associated with the CLO's portfolio and structure as
described in its methodology.

The Issuer is a managed cash flow CLO. At least 95% of the
portfolio must consist of senior secured obligations and up to 5%
of the portfolio may consist of senior unsecured obligations,
second-lien loans, mezzanine obligations and high yield bonds. The
portfolio is expected to be 80% ramped as of the closing date and
to comprise of predominantly corporate loans to obligors domiciled
in Western Europe. The remainder of the portfolio will be acquired
during the 6-month ramp-up period in compliance with the portfolio
guidelines.

CIFC CLO Management II LLC ("CIFCM II") 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
4.5-year reinvestment period. Thereafter, subject to certain
restrictions, purchases are permitted using principal proceeds from
unscheduled principal payments and proceeds from sales of credit
improved obligations.

Interest and principal amortisation amounts due to the Class X
Notes are paid pro rata with payments to the Class A Notes. The
Class X Notes amortise by 12.5% (1st payment date: 25%) or
EUR250,000 (1st payment date: EUR500,000) over the first 7 payment
dates starting on the 1st payment date.

In addition to the eight classes of notes rated by Moody's, the
Issuer will issue EUR500,000 of Class Y Notes and EUR33,000,000 of
Subordinated Notes which will not be rated. The Class Y Notes
receive payments in an amount of 4.394bps per annum of the
portfolio's par amount and its notes' payment is pari passu with
the payment of the subordinated management fee.

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
March 2019.

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. The collateral manager's investment decisions and
management of the transaction will also affect the notes'
performance.

Moody's modeled the transaction using 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 March 2019.

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

Par Amount: EUR400,000,000

Diversity Score: 42

Weighted Average Rating Factor (WARF): 2875

Weighted Average Spread (WAS): 3.75%

Weighted Average Coupon (WAC): 4.50%

Weighted Average Recovery Rate (WARR): 44.5%

Weighted Average Life (WAL): 8.5 years

Moody's has addressed the potential exposure to obligors domiciled
in countries with local currency ceiling of A1 or below. As per the
portfolio constraints and eligibility criteria, exposures to
countries with LCC of A1 to A3 cannot exceed 10% and obligors
cannot be domiciled in countries with LCC below A3.


CO-OPERATIVE BANK: Moody's Ups Deposit Ratings to B3, Outlook Pos.
------------------------------------------------------------------
Moody's Investors Service upgraded the standalone baseline credit
assessment and the long-term deposit ratings of The Co-operative
Bank plc to b3 from caa1 and to B3 from Caa1 respectively. The
outlook on the long-term deposit ratings was changed to positive
from stable.

RATINGS RATIONALE

The upgrade of The Co-operative Bank's BCA to b3 from caa1 reflects
further progress the bank has made in de-risking its balance sheet
and reducing operational risk in relation to its restructuring
plans, balanced against a still high level of execution risk and a
loss-making financial profile.

The Co-operative Bank continues to make progress in de-risking its
balance sheet. The stock of problem loans remains low, equivalent
to 2.8% of gross loans as of December 2018 and mostly related to
what remains of its legacy "Optimum" mortgage portfolio; capital
ratios are high in absolute terms, as indicated by a 25.7% total
capital ratio as of March 2019 (pro-forma to take into account a
GBP200 million Tier 2 issuance in April 2019); the bank has
recently succeeded in issuing a Tier 2 bond; and the stock of
liquid assets is sound at around 18% of tangible banking assets as
of December 2018. Execution risk is reducing: Moody's expects The
Co-operative Bank to completely separate its IT infrastructure from
former shareholder The Co-operative Group by the end of 2019.

Nevertheless, the significant steps the bank is taking to
reposition its balance sheet and to deliver a more sustainable
business model entail a very high level of execution risk. In
particular, the following key issues are still pending: complete
separation from The Co-operative Group; the upgrade and
streamlining of its IT infrastructure; and an update of IT systems
to match its customers' changing behaviour and to enable the bank
to improve its competitiveness against other UK banks. This
transition, although progressing in line with the bank's
expectations, could yet result in large unexpected costs, delays,
or a disruption to service.

Finally, The Co-operative Bank is still structurally loss-making;
its business model, despite improvements made to date, is not yet
sustainable. The bank's inability to generate capital internally
makes it particularly at risk in a stressed scenario. Moody's said
The Co-operative Bank was only likely to break even without
recourse to tax credits or extraordinary gains from 2021, a year
later than the rating agency's previous assumptions; for 2019 and
2020 Moody's expects The Co-operative Bank to continue to be
loss-making, with negative pre-provision profits, albeit reduced
from the past. Achieving a sustainable level of profitability will
be challenging, given (1) dependence on rapid volume growth in a
weakening economy, (2) the need to grow net interest income amidst
declining margins in the UK residential mortgage business (almost
90% of The Co-operative Bank's loan book); and (3) an expected
increase in the cost of funding due to the recent Tier 2 issuance,
as well as future issuances to meet the bank's minimum requirements
for own funds and eligible liabilities (MREL).

FACTORS THAT COULD LEAD TO AN UPGRADE

The Co-operative Bank's BCA could be upgraded following a material
reduction in its level of execution risk, which can be achieved by
the completion of its separation from the Co-operative Group,
improvements in the bank's IT infrastructure, and a return to
sustainable internal capital generation through earnings.

An upgrade in the BCA would lead to an upgrade of the long-term
deposit ratings. Substantial issuance of bail-in-able subordinate
or senior debt, which would protect depositors from losses in a
resolution scenario, could also lead to an upgrade of the long-term
deposit ratings.

FACTORS THAT COULD LEAD TO A DOWNGRADE

The Co-operative Bank's BCA could be downgraded following a failure
of its IT transformation, evidence that the bank will not be able
to return to a sustainable level of net profitability in the
medium-term, or a lower level of junior deposits.

A downgrade of The Co-operative Bank's BCA would lead to a
downgrade of the bank's long-term deposit ratings.

OUTLOOK

The outlook on The Co-operative Bank's long-term deposit rating is
positive. This reflects Moody's view that execution risk will
reduce in the coming years as the bank continues to deliver on its
restructuring and investment plans.

LIST OF AFFECTED RATINGS

Issuer: The Co-operative Bank plc

Upgrades:

Long-term Counterparty Risk Ratings, upgraded to B2 from B3

Long-term Bank Deposits, upgraded to B3 from Caa1, outlook changed
to Positive from Stable

Long-term Counterparty Risk Assessment, upgraded to B1(cr) from
B2(cr)

Baseline Credit Assessment, upgraded to b3 from caa1

Adjusted Baseline Credit Assessment, upgraded to b3 from caa1

Affirmations:

Short-term Counterparty Risk Ratings, affirmed NP

Short-term Bank Deposits, affirmed NP

Short-term Counterparty Risk Assessment, affirmed NP(cr)

Outlook Action:

Outlook changed to Positive from Stable


DEUTSCHE BAHN: Auditors Raise Going Concern Doubt Amid Arriva Sale
------------------------------------------------------------------
The Telegraph reports that auditors to one of UK-based transport
group Arriva's train operators believe sale plans by its German
owners call into question the company's ability to continue as a
going concern.

Deutsche Bahn, the German state-owned transport giant, reignited a
sales process for its UK-based company, Arriva, earlier this year,
The Telegraph relates.  It is hoping to raise GBP3 billion by
either a private sale or a stock market float.  The German company
is desperate to raise cash to pay down debts of nearly EUR20
billion, The Telegraph discloses.


ENSCO ROWAN: S&P Affirms 'B-' ICR on Below-Par Cash Tender Offer
----------------------------------------------------------------
S&P Global Ratings affirmed all its ratings, including its 'B-'
issuer credit rating, on U.K.-based offshore drilling contractor
Ensco Rowan PLC. The outlook is negative.

S&P said, "The rating affirmation reflects our view that Ensco
Rowan's below-par cash tender offer is opportunistic rather than
distressed. Although the offer represents about a 25% discount to
par on some debt issues, and we expect leverage to remain very high
over the next couple of years, we believe that Ensco Rowan is at
minimal risk of default on these instruments over the next few
years.

"The negative outlook reflects our expectation that Ensco Rowan's
credit measures will be weak for the rating over the next year,
including debt to EBITDA of 8x-10x in 2020."



HIKMA PHARMACEUTICALS: S&P Alters Outlook to Pos & Affirms BB+ ICR
------------------------------------------------------------------
S&P Global Ratings revised its outlook on Hikma Pharmaceuticals to
positive from stable and affirmed its 'BB+' issuer credit rating.

S&P said, "The positive outlook reflects Hikma's recent financial
performance that demonstrates that its profitability is resilient,
and supported by a more diversified portfolio. S&P also believes
that the group could potentially maintain adjusted debt to EBITDA
below 2x even in case of a sizable acquisition.

Through various optimization initiatives, Hikma achieved the
turnaround of its generics division. It completed the consolidation
of the facilities in the U.S, closing down the Eatontown and
Memphis facilities, and transferring the assets and products to
Columbus in the U.S. and to Jordan. It also centralized the
distribution platform, and reduced overheads.

In addition of optimizing the cost structure, the group
restructured its generics research and development team and
implemented a portfolio review, discontinuing non-profitable
products. The company launched 13 products in the generics division
in 2018. This not only resulted in materially higher profitability
for the division, with an operating margin of 13.4% from 3.6% in
2017, but also in a more diversified portfolio. The top 10 products
contributed over 50% of revenue, while they represented 93% of
revenue in 2015. The resilience of the portfolio is also supported
by the fact that a large proportion of the products faces limited
competition. About one-third (35%) of the drugs in the portfolio
have only three to five competitors and 29% have two or fewer.

One key challenge for the company is to demonstrate its ability to
develop more complex and higher-value products. S&P said, "We will
closely monitor the launch of the generic Advair Diskus and the
Elipta portfolio. We understand that although the U.S. Food and
Drug Administration increased the number of "abbreviated" new drug
applications it accepts, approvals for more complex products remain
limited." In 2018, out of 723 approved new drugs, only 261 were
launched. Mylan has already launched its generic version of Advair
respiratory blockbuster, at a 70% discount compared with the
original drug, and should capture a large market share. Novartis
Sandoz is also trying to obtain approval. Hikma's earning prospects
could considerably vary if it is only the second or third company
to launch a generic version.

In 2018, total group revenue grew by 6.9% to $2.1 billion, while
S&P Global Ratings-adjusted EBITDA reached $524 million. All of
Hikma's business lines contributed to growth. This translated into
lower S&P Global Ratings-adjusted debt to EBITDA of 1.2x (versus
1.5x in 2017). Over the next two years, S&P expects revenue will
continue to grow, supported by new launches, and we assume that the
margins will remain at 23%-24%. This reflects potential pricing
pressure from increasing competition, partially mitigated by the
well-diversified portfolio, with only 8% of products generating
more than $20 million of revenue.

The group is investing in future growth, which will incur higher
working capital needs and higher capital expenditure (capex) to
increase manufacturing capabilities. S&P said, "We therefore
forecast FOCF to debt of 23%-26% in 2019 and 2020. Our S&P Global
Ratings-adjusted debt consists primarily of $613 million of
financial debt, and adjustments of $55.3 million of operating
leases, and $77 million of guarantees and other debt. We deduct
$320 million of cash."

S&P believes that the group operates in a consolidating industry
and could potentially pursue an acquisition. The company has a
financial policy of a maximum leverage of 3x and it believes it has
a potential to delever below S&P Global Ratings-adjusted leverage
of 2x, depending on both synergies and organic growth and
profitability.

In the injectables business, Hikma was able to offset pricing
pressure due to competition on Glycopyrrolate, neostigmine, and
Thiotepa, thanks to new launches and by responding to the market
shortage of injectable pain management in the U.S. Market share in
volumes increased to 16.6% from 14.9% in 2017. Pricing pressure
could intensify, as supply should increase, with competitors such
as Pfizer restarting production after temporary closure due to
quality issues.

S&P notes that Hikma has no development capacity in biosimilars but
is present in this segment through its partnerships with Celltrion.
It now has exclusive agreements with the South Korea-based company
for three biosimilar products: Truxima (Rituximabb); Remisima
(infliximab); and Herzuma (Trastuzumab).

The branded business continues to be a stable business, apart from
foreign exchange movements. The group expects a strong pipeline of
new launches in 2019. Revenue from in-licensed products represented
36% of branded revenue (versus 37% in 2017). Hikma signed a
partnership agreement with Omega Pharma Trading, an affiliate of
Perrigo, for the exclusive right to license and distribute more
than 30 consumer healthcare products across the Middle East and
North Africa (MENA), with the exception of current agreements in
place.

Hikma's competitive position remains constrained by its limited
size, in our view. We also note that the pricing environment in the
U.S. remains very challenging. Geopolitical tensions in MENA are an
additional source of volatility. However, the group has built a
track record of successfully operating in both regions despite
potential challenges.

S&P said, "The positive outlook reflects our view that Hikma will
continue to display resilient operating performance, growing
organically or potentially through M&A. In doing so, we anticipate
the group will pursue a financing strategy that would enable it to
maintain debt protection metrics in line with our modest financial
risk profile assessment.

"Specifically, we would view debt to EBITDA below 2x and FOCF to
debt of at least 25% on a sustainable basis as commensurate with a
higher rating.

"We would upgrade Hikma if the group continuous to grow either
organically or potentially through acquisitions while adhering to a
financial policy that would enable it to maintain S&P Global
Ratings-adjusted debt to EBITDA below 2x and FOCF to debt of at
least 25%. In our base case we assume organic revenue growth of
4%-5% supported by new launches, notably in respiratory medicines,
prioritizing launches such as Advair Diskus and Elipta portfolio.

"Alternatively, an upgrade could occur if we observed a continuous
strengthening of the group's competitive position on the back of
better diversification of the profitability base.

"We could take a negative rating action in case of large
debt-funded acquisitions that led to financial leverage increasing
above 2x on a sustainable basis, or if operating margins
deteriorated significantly due to pricing pressure in the U.S. and
or a surge in competition."


MONSOON ACCESSORIZE: Creditors Back Company Voluntary Arrangement
-----------------------------------------------------------------
Jessica Clark at City A.M. reports that creditors have approved
Monsoon Accessorize's restructuring plan which will see rents
slashed at more than half of the fashion retailer's leased stores.

The store said its company voluntary arrangement (CVA) proposals
had passed "with a majority significantly above the required
threshold", City A.M. relates.

In total, rent will be cut at 135 of Monsoon and Accessorize's 258
stores and the retailer's founder Peter Simon will inject an
additional GBP18 million into the business, City A.M. discloses.
This follows an emergency GBP12 million loan provided earlier this
year, City A.M. notes.

In a bid to win over landlords, Mr. Simon had offered them up to
GBP10 million if the business makes a profit and beats its
forecasts following the restructuring plan, City A.M. relates.

No stores are earmarked for closure under the plans, City A.M.
states.

Monsoon Accessorize is a fashion chain based in the United
Kingdom.


PARAGON CREATIVE: Appoints Administrators From KPMG
---------------------------------------------------
Paragon Entertainment Limited, in furtherance to an announcement on
June 20, 2019, confirmed that James Lumb -- james.lumb@kpmg.co.uk
-- and Howard Smith -- howard.smith@kpmg.co.uk -- of KPMG LLP have
been appointed as administrators to Paragon Creative Ltd ("PCL"),
its principal operating subsidiary.  The Board has determined that
there is little chance of there being any surplus available to
shareholders of Paragon following the administration of PCL and
that no other subsidiaries of Paragon have any material value left
in them likely to produce such a surplus.  In view of these,
finnCap Ltd has resigned as Nominated Adviser and Broker to Paragon
with immediate effect.

            About Paragon

Paragon Entertainment is the holding company of Paragon Creative, a
company which designs and builds world-class visitor attractions
and experiences. It works for museums, heritage centres, zoos and
aquariums, theme parks and visitor attractions, science centres,
retailers, food and beverage outlets and brand centres. Recent
projects include Land of the Lions at London Zoo, The Rolling
Stones Exhibitionism at the Saatchi Gallery, Motiongate theme park
in Dubai, Kidzania in London, The Olympic Museum in Lausanne, the
Titanic in Belfast, and Wallace and Gromit Thrillomatic at
Blackpool Pleasure Beach.


PMC SOIL: Trading Difficulties Prompt Administration
----------------------------------------------------
Business Sale reports that PMC Soil Solutions Limited, a waste
management, remediation and enabling works company providing
services to the construction industry, has collapsed into
administration due to a series of trading difficulties.

The company, trading from its base in Canning Town, London and its
headquarters in Kings Cross, was forced to call in specialists from
Leonard Curtis Business Rescue & Recovery to handle the
administration process, with partners Andrew Duncan --
andrew.duncan@leonardcurtis.co.uk -- and Alex Cadwallader --
alex.cadwallader@leonardcurtis.co.uk -- appointed as joint
administrators, Business Sale relates.

In the year ending November 30, 2018, its Companies House accounts
showed a turnover of GBP11.3 million and a pre-tax profit of
GBP247,000, Business Sale discloses.

Despite this, the administrators stated that they would follow
through with an "orderly wind-down" of the business, after citing
accounting irregularities, poor trading during the winter months,
and declining margins in the marketplace as the reason for the
company's downfall, according to Business Sale.

The director of PMC Soil Solutions attempted to restructure the
business by involving bankers and a number of professional
advisers, Business Sale relays.  In spite of this, it failed to
secure sufficient amounts of work capital to continue its trading
operations, Business Sale notes.

In a public statement, Mr. Duncan, as cited by Business Sale, said
"We are now seeking interested parties to purchase the company's
assets and will focus on providing the affected employees with the
appropriate support while seeking to maximize realisations for the
benefit of the company's creditors."


RDLZ REALISATION: August 2 Claims Filing Deadline Set
-----------------------------------------------------
Creditors of RDLZ Realisation plc (formerly Ranger Direct Lending
ZDP PLC) are required, on or before August 2, 2019, to send in
their full forenames and surnames, their addresses and
descriptions, full particulars of their debts or claims and the
names and addresses of their solicitors (if any), to James Eldridge
of 150 Aldersgate Street, London, EC1A 4AB, the joint liquidator of
the said Company, and, if so required by notice in writing from the
said liquidator, are, personally or by their solicitors, to come in
and prove their debts or personally or by their solicitors, to come
in and prove their debts or claims at such time and place as shall
be specified in such notice.

RDLZ Realisation is in a solvent liquidation.  The Directors of the
Company have made a declaration of solvency and it is expected that
all creditors will be paid in full.

James Eldridge -- james.eldridge@bdo.co.uk -- and Jeremy Willmont
-- jeremy.willmont@bdo.co.uk -- of BDO LLP were appointed joint
liquidators of the Company on June 20, 2019.

For further queries, one may contact Lorraine Humphreys through
telephone (020)7334-9191 or e-mail lorraine.humphreys@bdo.co.uk


SHINE HOLDCO III: Moody's Lowers CFR to B3, Outlook Stable
----------------------------------------------------------
Moody's Investors Service downgraded Shine Holdco III Limited's
corporate family rating to B3 from B2, and probability of default
rating to B3-PD from B2-PD.

Concurrently, Moody's has also downgraded the ratings on Shine
Acquisition Co Sarl's USD545 million senior secured first lien term
loan due 2024 to B2 from B1, the USD75 million revolving credit
facility due 2022 to B2 from B1, and the rating on to the USD175
million senior secured second lien term loan due 2025 to Caa2 from
Caa1. The first lien and second lien facilities are co-borrowed by
Shine Acquisition Co Sarl and Boing US Holdco Inc.

The outlook on all entities remains stable.

"Moody's downgraded ICWG's CFR to B3 from B2 because of the lack of
deleveraging from the closing leverage of around 7.0x (based on
Moody's adjusted metrics) at the time of the debt issuance in
September 2017", says Tanya Savkin, Moody's lead analyst for ICWG.
"Moody's also expect deleveraging in the next 12-18 months to be
constrained by investments in support functions in the US as well
as debt-funded acquisitions or expansionary capex", adds Ms
Savkin.

RATINGS RATIONALE

The action is mainly driven by the company's high Moody's-adjusted
leverage of 7.3x as of March 2019 as well as Moody's expectation
that deleveraging will be limited in the next 12-18 months because
investments in support functions to support the US expansion will
likely offset the positive impact of cash-funded acquisitions and
revenue ramp-up of sites opened or renovated in recent years.

The high leverage reflects the closing leverage of around 7.0x at
the time of the debt issuance in September 2017 as well as
debt-funded acquisitions of small operators in the US and
expansionary capital spending in Q4 2017. The slower deleveraging
trajectory than the rating agency's initial expectation was due to
debt-funded acquisitions and expansionary capex in late 2017,
investments in support functions to back growth in the US, and
lower revenue ramp-up from sites opened or renovated in recent
years.

Same-site sales increased by 5% in 2018 but management run-rate
adjusted EBITDA decreased to USD119.9 million from USD123.3 million
in 2017. The lower run-rate EBITDA was mainly driven by the new
management's downward revisions to the expected revenue ramp-up of
some sites opened or renovated in 2015-2017 and investments in
people and capabilities to support the expansion in the US.

The run-rate LTM EBITDA further decreased to $116.6 million in Q1
2019, driven by similar factors.

On the other hand, the company had significant cash balances of
GBP46 million ($60 million) as of March 2019 reflecting proceeds
from recent sale-and-leaseback transactions which will enable the
company to fund small bolt-on acquisitions and expansionary capex
in the US. Liquidity is further supported by the undrawn $75
million revolving credit facility due 2022, and the absence of
large debt maturities before 2022. Moody's also expects the company
to maintain comfortable headroom under the revolving credit
facility's springing net first-lien leverage ratio covenant of
5.85x.

STRUCTURAL CONSIDERATIONS

The B2 rating of the first-lien credit facilities reflects their
position as secured liabilities ranking ahead of the second-lien
term loan, which is rated Caa2.

The first- and second-lien facilities are secured by a package
(including both share pledges and charges over other assets)
granted by the co-borrowers and holding and operating companies
that account for at least 80% of the group's consolidated EBITDA.

OUTLOOK

The stable outlook reflects Moody's expectation that material
deleveraging in the next 12-18 months will be constrained by
additional investments in support functions to support the
company's US expansion strategy. The stable outlook does not assume
material debt-funded distribution to shareholders or acquisitions.

FACTORS THAT COULD LEAD TO AN UPGRADE/DOWNGRADE

While unlikely in the near term given the elevated leverage, upward
rating pressure could be exerted if the Moody's-adjusted debt /
EBITDA is sustainably below 6.5x, the Moody's-adjusted EBITA /
interest increases towards 1.5x, and the company maintain a solid
liquidity profile including positive underlying free cash flow
generation.

Downward rating pressure could be exerted if the Moody's-adjusted
debt / EBITDA is sustainably above 7.5x, the Moody's-adjusted EBITA
/ interest is below 1.0x, or liquidity materially weakens including
deteriorating underlying free cash flow.

International Car Wash Group, co-headquartered in Buckinghamshire,
the UK, and Denver, Colorado, USA, operates a network of around 900
sites across 12 European countries, Australia and, since 2015, the
US, where it now has around 140 sites, washing around 40 million
cars every year. It generated revenue of GBP244 million in 2018.


SMARTFOCUS HOLDINGS: Appoints Administrators from BDO LLP
---------------------------------------------------------
Jeremy Willmont, William Matthew Tait -- matthew.tait@bdo.co.uk --
and Francis Graham Newton --- graham.newton@bdo.co.uk -- of BDO LLP
were appointed administrators of Smartfocus Holdings Limited
(formerly Emailvision Holdings Limited; UK Holdco Limited) and
Smartfocus UK Ltd (formerly Email Reaction Limited; Highergiant
Limited) on June 7, 2019.

The Companies engage in other information technology service
activities.

The Administrators can be reached at:

         Jeremy Willmont
         William Matthew Tait
         BDO LLP
         150 Aldersgate Street
         London, EC1A 4AB

           -- and --

         Francis Graham Newton
         BDO LLP
         Central Square
         29 Wellington Street, Leeds LS1 4DL

For further details, one may contact:

         Vicky Stroud
         Tel: + 44(0)20-7334-9191
         E-mail: vicky.stroud@bdo.co.uk
         Ref: SMARTFOCUS


TVL FINANCE: S&P Rates New GBP440MM Secured Notes Due 2025 'B-'
---------------------------------------------------------------
S&P Global Ratings assigned its 'B-' issue rating and a '3'
recovery rating to TVL Finance PLC's proposed GBP440 million senior
secured floating-rate notes due 2025. TVL Finance PLC is the
financing subsidiary of Thame and London Ltd. (the parent company
for Travelodge group). The '3' recovery rating indicates S&P's
expectation for meaningful recovery (50%-70%; rounded estimate:
65%) for lenders in the event of a payment default.

The proceeds from the proposed bond will be used to repay the
group's existing debt. S&P does not expect the refinancing to have
any impact on the group's S&P Global Ratings-adjusted debt to
EBITDA, which will remain about 8.6x, as the total outstanding debt
is broadly similar.

The transaction does improve the group's credit profile
marginally--it will extend the debt maturity profile by a couple of
years and could reduce its annual cash interest obligations. There
is no covenant requiring the group to hedge its exposure to
floating-rate debt.

On the completion of the proposed transaction, S&P intends to
withdraw the ratings on the existing GBP50 million revolving credit
facility (RCF), GBP232 million fixed-rate notes (due 2023), and
GBP195 million floating-rate notes (due 2023).

Despite the competitive nature of its end market, Travelodge has
succeeded in gradually improving its trading performance over the
past three years. It has increased the number of hotels, and
improved both occupancy rates and revenue per available room.

KEY ANALYTICAL FACTORS

-- The recovery rating on the proposed senior secured notes is
supported by Travelodge's strong brand and market position, but
constrained by its subordination to the RCF.

-- Although the proposed unrated RCF will be super senior, the
facility size will reduce to GBP40 million from the current GBP50
million.

-- S&P's hypothetical default scenario assumes reduced occupancy
rates for a prolonged period, combined with an increase in lease
rental costs and competitive price pressures.

-- S&P values the company as a going concern, given its high brand
recall value and good market position. It assesses the security
package as weak, because it mainly consists of share pledges and
assets, reflecting the asset-light nature of the company. As with
the security package for its existing debt, most of Travelodge's
leases and its brand name are excluded.

-- The proposed documentation provides the group with the
flexibility to raise additional super senior debt, up to GBP122
million. Although S&P's operating case does not include such a
drawdown, the group could draw on this in case of financial
difficulties. The possibility is reflected in its recovery
expectation of '3' (65% rounded estimate).

SIMULATED DEFAULT ASSUMPTIONS

-- Year of default: 2021
-- Jurisdiction: U.K.

SIMPLIFIED WATERFALL

-- Emergence EBITDA: about GBP62 million.
-- Multiple: 6.0x
-- Gross recovery value: GBP372 million
-- Net recovery value after administrative expense (5%): GBP354
million
-- Estimated first-lien debt claims: GBP51 million
-- Remaining recovery value: GBP303 million
-- Estimated senior secured debt: GBP458 million*
-- Recovery range: 50%-70% (rounded estimate 65%)
-- Recovery rating: 3

*All debt amounts include six months of prepetition interest.



                           *********


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

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

Copyright 2019.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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