251028.mbx

251028.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 Tuesday, October 28, 2025, Vol. 26, No. 215 Headlines F R A N C E PARTS HOLDING: S&P Affirms 'BB-' LongTerm ICR, Outlook Stable H U N G A R Y NITROGENMUVEK ZRT: S&P Raises LT ICR to 'CCC+' on Debt Refinancing I R E L A N D BARINGS EURO 2020-1: Fitch Rates Class F-R-R Notes 'B-sf' CITIZEN IRISH 2025: Fitch Assigns B-sf Final Rating on Cl. B Notes NOURYON LIMITED: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable TIKEHAU CLO XIV: Fitch Assigns 'B-(EXP)sf' Rating on Class F Notes I T A L Y EFESTO BIDCO: Fitch Assigns 'B' LongTerm IDR, Outlook Negative K A Z A K H S T A N FORTEBANK JSC: Fitch Rates New USD Add'l Tier 1 Notes 'B(EXP)' L U X E M B O U R G B&M EUROPEAN: S&P Places 'BB+' LongTerm ICR On Watch Negative ELEVING GROUP: Fitch Rates EUR275MM 9.5% Secured Bonds 'B' ENERGUATE TRUST 2: Fitch Hikes LongTerm IDRs to BB+, Outlook Stable ORION SA: S&P Affirms 'BB' ICR & Alters Outlook to Negative R U S S I A NAVOIYAZOT JSC: Fitch Assigns 'BB-' LongTerm IDR, Outlook Stable T U R K E Y ZORLU ENERJI: Fitch Alters Outlook on 'B+' LongTerm IDR to Negative U K R A I N E OSCHADBANK JSC: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings SENSE BANK: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings UKREXIMBANK JSC: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings UKRGASBANK JSB: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings U N I T E D K I N G D O M ALBA 2006-2: S&P Affirms 'BB+(sf)' Rating on Class F Notes HALLMARK MANUFACTURING: FRP Advisory Named as Administrators HIGHWAYS 2021: S&P Affirms 'BB+(sf)' Rating on Class E Notes HOPS HILL NO. 4: S&P Affirms 'BB(sf)' Rating on Cl. E-Dfrd Notes HUMAN MAGIC: S&W Partners Named as Administrators MOLOSSUS BTL 2024-1: Fitch Hikes Rating on Class X Notes to 'BB-sf' OAKTREE POWER: Begbies Traynor Named as Administrators PEAK JERSEY: S&P Lowers LongTerm ICR to 'CCC' on Refinancing Risk POLARIS 2025-3: Fitch Assigns 'B-(EXP)sf' Rating on Class X2 Debt POLARIS 2025-3: S&P Assigns Prelim. CCC Rating on Cl. X2 Notes RILEY PERSONNEL: Quantuma Advisory Named as Administrators SALUS EUROPEAN LOAN 33: S&P Affirms 'B(sf)' Rating on D Notes SOUTH COAST WATCH: Moorfields Named as Administrators TRAVELPORT TECHNOLOGY: S&P Assigns 'CCC+' ICR, Outlook Stable VELO BICI: KRE Corporate Named as Administrators - - - - - =========== F R A N C E =========== PARTS HOLDING: S&P Affirms 'BB-' LongTerm ICR, Outlook Stable ------------------------------------------------------------- S&P Global Ratings affirmed its 'BB-' long-term issuer credit rating on Parts Holding Europe SAS (PHE) and its 'BB-' issue rating on its term loan B (TLB), as S&P expects limited support to the ratings from PHE's majority owner D'Ieteren Group (the parent entity) as the credit quality of each respective entity converges. The recovery rating of '3' indicates S&P's expectation of meaningful recovery (50%-70%; rounded estimate: 50%). The stable outlook indicates that S&P expects PHE to maintain an EBITDA margin of about 12%, generate meaningful positive FOCF, and keep adjusted debt to EBITDA below 4.0x, with a financial policy commensurate with the rating level. Steady organic growth thanks to market share gains and stable profitability should translate into stronger stand-alone credit metrics in 2025-2026. PHE performed robustly in the first half of the year, exhibiting good organic growth and benefiting from a positive contribution from recently acquired businesses in Spain and Ireland. S&P said, "We expect the company to expand thanks to positive trends in its underlying markets and the benefits from its decentralized operating model. We expect independent wholesalers will continue to increase their share in the after-market segment, over original equipment manufacturers, given their better pricing and access to end-customers. In this context, we expect PHE to grow faster than its local competitors thanks to its scale, which should translate into more efficient purchasing and an enlarged logistics network. We anticipate that its decentralized and more linear operating model will benefit PHE over more established players due to its better proximity to final clients and shorter delivery times." S&P said, "We project profitability to remain stable at slightly above 12% in the S&P Global Ratings-adjusted metric in 2025-2026, despite some pressures on the pricing of spare parts to normalize after years of rising prices. We expect better purchasing conditions thanks to PHE's higher scale to partially offset some input cost inflation, namely from labor costs, which could affect profitability. Overall, topline growth--combined with stable profitability--should translate into an EBITDA expansion in the next two years, leading to overall stronger credit metrics. "We foresee a steady increase in FOCF generation, despite working capital-related cash demand remaining high . FOCF generation was particularly volatile in 2023-2024 because the company only decided to draw down cash for receivables sold in 2023 in 2024. Thanks to good volume growth and stable profitability, we expect PHE's cash flow generation to increase steadily to more than EUR130 million-EUR150 million over the next two years. This robust operating performance should more than compensate for high working capital consumption, itself fuelled by an increase in inventories as the group integrates its latest acquisition and supports overall business growth. "We expect some improvements in cash flow generation also linked to the recently completed repricing of its TLB in September 2025. We note how PHE's cash interest cost has progressively reduced since 2024 following two successful repricings that have reduced debt margins to 3.00% from 3.75%. We estimate cash interest costs of about EUR75 million in 2025 from about EUR95 million paid in 2024 (including issuance fees). As result of robust cash flow generation and given that there are no meaningful upcoming maturities, we expect PHE's liquidity to remain ample. The company also has full access to its EUR241.5 million super senior revolving credit facility (RCF). In our view, management could draw from this facility to fund future acquisitions. "We continue to see M&A as a key strategic focus, but we now expect the company to maintain S&P Global Ratings-adjusted debt to EBITDA sustainably below 4.0x over our ratings horizon . PHE has a track record of expanding through M&A; over the past nine years it has completed 26 acquisitions, adding more than EUR1.1 billion to its total revenue. We note that, despite a strong appetite for inorganic growth, the company has continued to deleverage thanks to a disciplined approach and efficient deal execution, resulting in meaningful EBITDA expansion. Given the fragmented nature of the markets where the company operates and its role as consolidator, we expect M&A will remain a key focus in the next two years. PHE has already completed two deals in 2025, entering the Irish market via the acquisition of Top Part and expanding its market position in Spain via the acquisition of AD FRECO Parts. We note that the company recently financed its acquisitions with cash generated from operations, but we cannot rule out that it could increase its debt to finance larger, opportunistic deals. "While PHE has not committed to a specific leverage target, we expect it will continue to remain disciplined and to compensate any cash outflow for M&A with EBITDA expansion, keeping its debt to EBITDA sustainably below 4.0x. We foresee limited execution risks in the rollout of its M&A strategy, as the targets are usually already in business partnerships with Parts Holding (via the ADI network) and the owners continue to hold minority stakes, fostering an alignment of interests. "We now expect limited ratings support from the relationship with D'Ieteren Group as the two credit qualities converge . D'Ieteren Group has been the majority owner of PHE since 2022. We expect the company to remain important to its parent's long-term strategy, as it is still one of D'Ieteren Group's biggest earnings contributors after Belron Group SCA (BB-/Stable/--). However, as we consider PHE's improvements on a stand-alone basis, we see the differences in the two credit qualities to be reduced, limiting the support to the issuer ratings from the relationship with its parent. We assume that, in the aftermath of the EUR4 billion one-off dividend recapitalization to support a generational change in its shareholding structure, D'Ieteren Group's leverage remains higher than historical levels and we don't anticipate a material improvement in the short term. "The stable outlook indicates that we forecast PHE's revenue will continue to expand and its adjusted EBITDA margin will remain at about 12%, further supported by the integration of its recently acquired businesses. In addition, we foresee adjusted FOCF reaching more than EUR100 million in 2025. As a result, we forecast adjusted debt to EBITDA will stay below 4.0x with a financial policy commensurate with the rating level. "We could lower our ratings on PHE if its debt to EBITDA exceeded 4.5x or if FOCF to debt decreased below 5% for a prolonged period. This could stem from an unexpected decline in revenue; looser cost management; weakening EBITDA and FOCF; or a more-aggressive financial policy, including a sizable debt-funded acquisition. Although unlikely, we could also downgrade PHE if D'Ieteren Group's credit profile were to materially weaken. This could occur if dividend receipts from Belron and its other investee asset TVH, were materially lower, if it undertook material debt-funded M&A, or made higher shareholder returns. "We could raise the ratings if PHE's leverage falls further, such that debt to EBITDA stays comfortably below 3.5x, and if a material improvement in cash flow causes FOCF to debt to rise closer to 15%." A positive rating action would also hinge on the company increasing its scale and scope and continuing its revenue diversification outside France. An upgrade could also result from D'Ieteren Group's creditworthiness strengthening through EBITDA growth and restraint regarding shareholder distributions, following the dividend recap completed in 2024. ============= H U N G A R Y ============= NITROGENMUVEK ZRT: S&P Raises LT ICR to 'CCC+' on Debt Refinancing ------------------------------------------------------------------ S&P Global Ratings raised its long-term issuer credit rating on Hungary-based nitrogen fertilizer producer Nitrogenmuvek Zrt. to 'CCC+' from 'D' (default). At the same time, S&P raised the issue rating on Nitrogenmuvek's EUR200 million bond, due in June 2028, to 'CCC+' from 'D'. The positive outlook reflects our expectation that favorable market conditions will continue to support Nitrogenmuvek's operating performance through 2025-2026. Furthermore, we think that the company's profitability and cash flow would significantly improve if the carbon dioxide quota tax is lifted or materially reduced, contingent on a positive ruling from the EU court and successful implementation in Hungary. On Aug. 14, 2025, Nitrogenmuvek successfully refinanced its capital structure with a new bond of EUR200 million, with an extended maturity to June 30, 2028. Nitrogenmuvek's strong operating performance in first-half 2025, coupled with anticipated supportive market conditions through 2025-2026, is expected to improve its credit metrics and generate positive free operating cash flow (FOCF) in 2026. However, the long-term effect of the carbon dioxide quota tax represents a burden under its current capital structure, which S&P considers unsustainable. The positive rating action reflects that as of Aug. 14, 2025, Nitrogenmuvek successfully refinanced its capital structure and extended debt maturities to June 2028. The company's EUR200 million bond matured on May 14, 2025, and the company failed to repay the principal in a timely manner. After several months of negotiations with bondholders and advisors, an agreement was reached on Aug. 14, 2025, to issue a new bond with an extended maturity to June 30, 2028. The refinancing was facilitated by the provision of additional collateral, which included real estate, fertilizer production facilities, plant and equipment, cash, and receivables. Despite viewing the maturity extension as credit positive, S&P notes that the refinancing did not reduce the company's debt burden, and cash flow will be negatively affected by higher cash interest expenses stemming from the increased bond coupon. S&P said, "Nitrogenmuvek reported strong operating performance during the first six months of 2025, and we forecast that supportive market conditions will continue in 2025-2026. The company reported strong operating performance during first-half 2025, with sales increasing by 25% year over year and the EBITDA margin increasing from 3% to 12%. This mostly reflected improving market conditions for fertilizers, with higher prices and strong demand supporting volumes, which somewhat compensated increasing input costs. We forecast that positive market conditions will continue in 2025 and 2026, resulting in sales increasing by about 20%-22% in 2025, moderating to 2%-4% in 2026 as volumes remain steady but prices normalize. We also expect Nitrogenmuvek's profitability to continually improve, with an anticipated S&P Global Ratings-adjusted EBITDA margin of about 9%-10% in 2025, compared with 1% in 2024. Our calculation includes the negative effect of the carbon dioxide quota tax and other expenses of about Hungarian forint (HUF) 12 billion-HUF13 billion. "Although we expect Nitrogenmuvek's credit metrics to improve through 2025-2026, with FOCF turning positive from 2026, the long-term effect of the carbon dioxide quota tax remains a burden for its capital structure. We forecast that higher profitability in 2025-2026 will support strong deleveraging during the same period. Specifically, we expect S&P Global Ratings-adjusted debt to EBITDA to improve to 5.0x-5.5x in 2025 and 2026, from over 60.0x in 2024, reflecting a significant increase in absolute EBITDA from almost nil in 2024. This improvement will also strengthen the EBITDA interest coverage ratio, which we expect will be approximately 2.0x-2.5x during the same period. We forecast negative FOCF in 2025, mostly due to working capital volatility resulting in an expected cash outflow of about HUF16 billion, before turning positive in 2026 thanks to normalizing working capital. However, we think that payments related to the carbon dioxide quota tax significantly constrain the company's financial flexibility, particularly during challenging market conditions, as demonstrated in 2023-2024. This tax also structurally weakens Nitrogenmuvek's competitive position relative to its peers. Consequently, a favorable definitive outcome in Nitrogenmuvek's litigation regarding the emission trading system (ETS) decree is necessary for us to consider its current capital structure sustainable in the long term. "We think that Nitrogenmuvek's liquidity will be sufficient for the next year, however, our assessment is tempered by its limited track record of timely debt refinancing and access to financial markets. Strong market conditions for fertilizers, which led to our forecast positive cash funds from operations (FFO) of approximately HUF7 billion-HUF8 billion over the next 12 months, coupled with a robust cash balance of roughly HUF21 billion as of June 30, 2025, are expected to comfortably cover limited debt maturities, working capital needs, and capital expenditure (capex) over the next 12 months. While we acknowledge that the bond refinancing has substantially improved Nitrogenmuvek's short-term financial health, we assess the company's liquidity position as less than adequate, primarily due to the loss of its revolving credit facility following the transaction close (which the company is still in the process of negotiating with banks), as well as its limited access to financing markets demonstrated by the significant delays encountered during this year's bond refinancing process. We also note that historically, the company's operating performance has exhibited greater volatility than its peers, reflecting its full exposure to the cyclical fertilizer industry and the fluctuating European gas prices, both heavily influenced by external factors. Therefore, we anticipate that Nitrogenmuvek's cash flow generation could become negative, resulting in a material reduction of its cash balance, if market conditions were to worsen considerably or if the company were to experience other adverse business developments. "The positive outlook consider that reduced or eliminated carbon dioxide quota taxes, pending a positive EU court ruling and Hungarian implementation, would significantly improve Nitrogenmuvek's profitability and cash flow. On Oct. 9, 2025, the Advocate General's presented her opinion in the case concerning Hungary's carbon tax, strongly suggesting that the tax is incompatible with EU law, posing a significant challenge to companies like Nitrogenmuvek. The Advocate General concluded that the tax, which retrospectively levies a charge on operators receiving free emissions allowances under the EU ETS, undermines the system's core objectives by effectively converting free allowances into paid ones and disrupting the established balance of the EU system. While the Advocate General's opinion is not legally binding, with the timing and outcome of the litigation remaining uncertain, we think that the company's profitability and cash flow would significantly improve if the carbon dioxide quota tax is lifted or materially reduced, contingent on a positive ruling from the EU court and successful implementation in Hungary. "The positive outlook reflects our expectation that favorable market conditions will continue to support Nitrogenmuvek's operating performance through 2025-2026. Furthermore, we think that the company's profitability and cash flow would significantly improve if the carbon dioxide quota tax is lifted or materially reduced, contingent on a positive ruling from the EU court and successful implementation in Hungary. "We could revise the outlook to stable if the opinion of the Advocate General does not lead to a decision of the EU court that would favor Nitrogenmuvek in the ongoing litigation regarding the ETS decree." Moreover, S&P could lower its ratings on Nitrogenmuvek if: -- Liquidity deteriorates materially due to significantly negative FOCF; or -- S&P envisions a default or distressed exchange in the next 12 months. S&P could raise its ratings on Nitrogenmuvek if the EU court decision results in developments that make sure that the carbon dioxide quota tax no longer impair on Nitrogenmuve's profitability and cash flow, resulting in a capital structure that it considers to be sustainable. ============= I R E L A N D ============= BARINGS EURO 2020-1: Fitch Rates Class F-R-R Notes 'B-sf' --------------------------------------------------------- Fitch Ratings has assigned Barings Euro CLO 2020-1 DAC final ratings. Entity/Debt Rating ----------- ------ Barings Euro CLO 2020-1 DAC A-R-R XS3201274910 LT AAAsf New Rating B-1-R-R XS3201275131 LT AAsf New Rating B-2-R-R XS3201275305 LT AAsf New Rating C-R-R XS3201275560 LT Asf New Rating D-R-R XS3201275727 LT BBB-sf New Rating E-R-R XS3201276022 LT BB-sf New Rating F-R-R XS3201276378 LT B-sf New Rating Subordinated Notes XS2230876471 LT NRsf New Rating X-R-R XS3201274753 LT AAAsf New Rating Transaction Summary Barings Euro CLO 2020-1 DAC is a securitisation of mainly senior secured obligations (at least 90%) with a component of senior unsecured, mezzanine and second-lien loans and high-yield bonds. On the issue date, the note proceeds were used to redeem the existing notes, excluding the subordinated ones, and to fund a portfolio with a target par of EUR500 million. The portfolio is actively managed by Barings (U.K.) Limited. The CLO has a three-year reinvestment period and a seven-year weighted average life (WAL) test at closing. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'. The Fitch-weighted average rating factor of the identified portfolio is 23.7. High Recovery Expectations (Positive): At least 90% of the portfolio comprises senior secured obligations. The recovery prospects for these assets are more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-weighted average recovery rate of the identified portfolio is 61.7%. Diversified Asset Portfolio (Positive): The transaction has two matrices effective at closing. The matrices are based on a top 10 obligor concentration limit of 20% and correspond to a seven-year WAL test. The deal also includes other concentration limits, including a maximum exposure of 40% to the three largest Fitch-defined industries in the portfolio. These covenants ensure the portfolio will not be excessively concentrated. Portfolio Management (Neutral): The deal has a reinvestment period of about three years and includes reinvestment criteria similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio, with the aim of testing the robustness of the deal structure against its covenants and portfolio guidelines. Cash-flow Modelling (Positive): The WAL for the transaction's Fitch-stressed portfolio analysis is 12 months less than the WAL covenant. This is to account for the strict reinvestment conditions envisaged after the reinvestment period. These include passing the coverage tests and Fitch 'CCC' limit after the reinvestment period, and a WAL covenant that progressively steps down, before and after the end of the reinvestment period. These conditions would reduce the effective risk horizon of the portfolio during periods of stress. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade An increase of the default rate (RDR) by 25% of the mean RDR and a decrease of the recovery rate (RRR) by 25% at all rating levels in the current portfolio would have no impact on the class A-R-R, B-1-R-R, B-2-R-R, C-R-R and X-R-R notes and lead to downgrades of up to one notch for the class D-R-R and E-R-R notes and to below 'B-sf' for the class F-R-R notes. Downgrades may occur if the build-up of the notes' credit enhancement following amortisation does not compensate for a larger loss expectation than initially assumed due to unexpectedly high levels of defaults and portfolio deterioration. Due to the better metrics and shorter life of the current portfolio than the Fitch-stressed portfolio, the class B-R-R, D-R-R, E-R-R and F-R-R notes have rating cushions of two notches, and the class C-R-R notes have a cushion of three notches. Should the cushion between the current portfolio and the Fitch-stressed portfolio be eroded, either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of two notches for the class A-R-R and C-R-R notes, three notches for the class B-R-R and D-R-R notes, and to below 'B-sf' for the class E-R-R and F-R-R notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A reduction of the RDR by 25% of the mean RDR and an increase in the RRR by 25% at all rating levels in the Fitch-stressed portfolio would result in upgrades of up to two notches for all notes, except for the 'AAAsf' rated notes, which are at the highest level on Fitch's scale and cannot be upgraded. During the reinvestment period, based on the Fitch-stressed portfolio, upgrades may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, allowing the notes to withstand larger-than-expected losses for the remaining life of the transaction. After the end of the reinvestment period, upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Barings Euro CLO 2020-1 DAC The majority of the underlying assets or risk presenting entities have ratings or credit opinions from Fitch and/or other Nationally Recognized Statistical Rating Organizations and/or European Securities and Markets Authority registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Barings Euro CLO 2020-1 DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. CITIZEN IRISH 2025: Fitch Assigns B-sf Final Rating on Cl. B Notes ------------------------------------------------------------------ Fitch Ratings has assigned Citizen Irish Auto Receivables Trust 2025 DAC's notes final ratings. Entity/Debt Rating Prior ----------- ------ ----- Citizen Irish Auto Receivables Trust 2025 DAC Class A notes XS3196070059 LT AAAsf New Rating AAA(EXP)sf Class B notes XS3196070133 LT B-sf New Rating B-(EXP)sf Transaction Summary This is the fifth securitisation of Irish auto loan receivables originated by First Citizen Finance DAC (not rated). The pool consists mostly of hire purchase receivables and personal contract purchase receivables and contract hire. KEY RATING DRIVERS Sound Performance: Default rates in the originator's total book have been low. Fitch has assigned a weighted average default base case of 1.1% to the portfolio. Given the low absolute level of the base case and the absence of a revolving period, Fitch has assigned a default multiple of 7.25x at 'AAAsf' and a recovery base case of 70%. The 'AAAsf' recovery haircut of 45% is below the median within Fitch's criteria range, primarily reflecting the secured nature of the recoveries. Overall credit losses are 4.9% at 'AAAsf' in Fitch's analysis. Used-Car Value Exposure: Most of the contracts are regulated by the Consumer Credit Act, which allows for voluntary termination (VT) of contracts by borrowers without further repayment obligations once 50% of the total amount due is paid. Loans subject to residual value risk are limited. Fitch used line-by-line loan data to assess the VT risks and has assumed a combined loss of 3.1% at 'AAAsf'. Loans with balloon exposure make up 5% of the portfolio. This risk is addressed through higher default multiples at 'AAAsf'. Initial Pro Rata Amortisation: The notes begin amortising pro rata. They switch to sequential if the transaction reaches a certain level of gross cumulative defaults or if there is an uncured principal deficiency ledger (PDL) higher than 0.5% of the outstanding portfolio balance. Fitch views the triggers as sufficiently tight to limit the length of the pro rata period in high rating scenarios. PIR Mitigated: Payment interruption risk (PIR) is a primary risk driver for the class A notes as interest payments are due in accordance with the terms and conditions. The funded liquidity reserve will cover senior expenses, interest and any PDL on the class A notes. Since the reserve is not fully dedicated for liquidity risk and could be depleted by defaults, Fitch tested the coverage of PIR exposure over the transaction's life. Fitch believes that PIR is mitigated, especially considering the appointment of a back-up servicer at closing providing additional mitigants in a servicer disruption event. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Asset performance deterioration, such as increased defaults, reduced recoveries or increased market value stress, which could be driven by macroeconomic conditions, business practices, credit policy or legislative landscape, would contribute to negative revisions of Fitch's asset assumptions that could negatively affect the ratings. An unexpected increase in the frequency of defaults or decreases in recovery rates producing larger losses than the base case could result in negative rating action on the notes. For example, a simultaneous increase in the default base case by 10%, and a decrease in the recovery base case by 10%, would lead to 'NR' for the class B notes and have no impact for the class A notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade The class A notes are at the highest level on Fitch's scale and cannot be upgraded. For the class B notes, a simultaneous decrease in the default base case by 25% and increase in the recovery base case by 25%, would have no impact on the rating. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Citizen Irish Auto Receivables Trust 2025 DAC Fitch reviewed the results of a third party assessment conducted on the asset portfolio information, and concluded that there were no findings that affected the rating analysis. Fitch conducted a review of a small targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. NOURYON LIMITED: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable ---------------------------------------------------------------- Fitch Ratings has affirmed Nouryon Limited's (Nouryon) Long-Term Issuer Default Rating (IDR) at 'B+' with Stable Outlook. Fitch has also affirmed Nouryon Finance B.V.'s instruments senior secured rating at 'BB-'. The Recovery Rating is 'RR3'. The Stable Outlook reflects its expectation that leverage metrics will remain within the rating sensitivities in the near term. High leverage remains the key rating constraint for Nouryon. The rating continues to benefit from the company's diversified specialty chemical focus, more stable margins than commodity chemical peers' and resilient cash flows. Nouryon's continued portfolio refinement and investments within its existing business segments are also supportive of the business profile. Fitch has also affirmed Nouryon Holding B.V.'s 'B+' Long-Term IDR with Stable Outlook and withdrawn the rating. Fitch is withdrawing the ratings of Nouryon Holding B.V. as the company underwent a reorganization. Accordingly, Fitch will no longer provide rating or analytical coverage for Nouryon Holding B.V. Key Rating Drivers Group Structure Changes Completed: The reorganisation of Nouryon to simplify the company structure has been completed. Consolidated financial reporting has shifted from Nouryon Holding B.V. to Nouryon Limited, and Nouryon Limited now guarantees the loans at Nouryon Finance, leading to its withdrawal of the rating on Nouryon Holding B.V. Weaker 1H25 Results: Nouryon reported adjusted EBITDA of USD577 million in 1H25, down 5% yoy, and reduced its 3Q25 guidance to USD260 million-270 million from USD290 million-300 million. This is due to softer-than-expected volumes in performance materials, which offset stable demand in core markets like agriculture and personal care. The updated 3Q25 guidance also includes higher raw material costs in certain categories. The company expects stable volumes at lower levels than previously forecast, reflecting its focus on core products and product mix optimisation. Leverage in Line with Sensitivities: While Nouryon performed well compared to other chemical companies, Fitch revised its forecasts down on the weaker results and now expect 2025 EBITDA to be 7% lower from the previous year (USD964 million compared to USD1 billion in 2024). Fitch continues to expect EBITDA gross leverage of 6.4x in 2025, below the negative rating sensitivity of 6.5x. Fitch also expects EBITDA gross leverage to improve to below 6x over 2026-2028 as chemical sector gradually recovers and Nouryon's new investments start to contribute to cash flows. However, this is subject to limited dividend payments and largely positive free cash flow (FCF) generation, which will hinge on how the company balances its capital-allocation priorities. A&E Transaction Shelved: Nouryon has shelved its plans to amend and extend (A&E) its first-lien USD3.9 billion and EUR1.7 billion term loan B tranches, and its USD850 million revolving credit facility, due to adverse capital market sentiment. Fitch believes Nouryon still has sufficient time to execute its planned refinancing, despite having put the A&E on hold. This is supported by its stronger historical and projected performance than many European peers, especially in commodity chemical segment, that have encountered more pronounced cash flow reductions in the current market downturn. Marginal Direct Tariff Impact: Nouryon has reported marginal direct tariff impact so far, with a more significant indirect effect on customer demand and the broader macro environment. The company is mitigating the impact with selective price increases and by leveraging a broad supplier base to hedge direct tariff costs. Nouryon's guidance assumes the tariff impact will remain constant and its actions will offset most direct effects. In addition, about 75% of its products are manufactured and sold in the same region, avoiding the impact of cross-border tariffs. Key Investments in Brazil, Sweden: Nouryon is advancing two key capex projects. In Brazil, it is expanding sodium chlorate capacity by about 20% and building integrated sodium chlorate and chlorine dioxide facilities to supply Arauco's new pulp mill and support Brazil's growing pulp industry, enhancing scale and long-term contracted volumes. In Sweden, Nouryon will double capacity at its Bohus Kromasil chromatography media plant, with production scheduled for early 2027. The expansion will help Nouryon meet surging global demand for GLP-1 peptide-based drugs for diabetes and obesity, strengthening its consumer and life sciences division. Capex Normalising: Nouryon expects average annual capex of about USD250 million compared with USD360 million-390 million in 2022-2023. Spending will likely rise to around USD300 million in 2026 due to its two main projects in Brazil and Sweden. Fitch expects the projected lower capex to support Nouryon's deleveraging capacity, but its plans remain dependent on its ultimate growth path. Diversification Supports Credit Profile: Nouryon has a diversified manufacturing base of 63 plants globally. About 75% of products are manufactured and sold in the same region, and about 60% are produced in more than one region. Nearly 70% of revenue comes from product families where Nouryon holds number one or two positions. Regional alignment and strong market positions enhance operational resilience and support credit quality. Leverage Key Credit Constraint: Fitch expects Nouryon's EBITDA gross leverage to remain consistent with its rating expectations through 2025-2028, but Fitch still views leverage as high, constraining the rating to the 'B' category. Fitch understands from management that The Carlyle Group may consider an IPO, which could facilitate deleveraging; however, listing timing is uncertain. If an IPO does not occur within the next nine to 12 months, Nouryon may resume growth via bolt-on acquisitions. Peer Analysis Nouryon's closest peer is H.B. Fuller Company (BB/Stable). Both are specialty chemicals producers. Nouryon is larger, with EBITDA in 2024 almost double that of H.B Fuller. Profitability is stronger at Nouryon, with Fitch-adjusted EBITDA margins of 18%-21% historically, while H.B. Fuller's margins are 15%-16%. Nouryon has global presence across its three businesses, while H.B. Fuller benefits from broad raw material diversification and leading positions in a fragmented adhesives market. Overall, Nouryon has the stronger business profile, but its 'B+' rating is constrained by higher leverage. Fitch expects Nouryon to maintain EBITDA gross leverage of between 4.7x and 6.5x, compared with 3.5x to 4.5x for H.B. Fuller. Key Assumptions - Revenue to remain broadly flat in 2025 and increase at low single-digits in 2026-2028 - EBITDA margin of 19% in 2025 and averaging 20.5% in 2026-2028 - Annual capex on average at 4.9% of sales in 2025-2028 - M&A of USD100 million a year in 2026-2028 - No dividends in 2025, followed by USD100 million a year in 2026-2028 Recovery Analysis The recovery analysis assumes that Nouryon would be reorganised as a going concern (GC) in bankruptcy rather than liquidated. The GC EBITDA estimate reflects Fitch's view of a sustainable EBITDA level after restructuring, on which Fitch bases its enterprise valuation (EV). The GC EBITDA of USD800 million reflects changes in regulation or substantial external pressures, such as a severe global downturn that particularly hits Nouryon's main end-markets, resulting in heavily reduced demand for its products, but also considers corrective measures taken to offset adverse conditions. Fitch uses a multiple of 5.5x to calculate a GC enterprise valuation for Nouryon because of its leadership position, resilient exposure to non-cyclical end-markets, solid profitability and high barriers to entry due to substantial R&D requirements for product development. Fitch assumes the company's revolving credit facility (RCF) to be fully drawn and to rank equally with its term loans B, and that its securitisation facility would be replaced by an equivalent super-senior facility. After deducting 10% for administrative claims, Fitch's analysis resulted in a waterfall-generated recovery computation for the senior secured instrument in the 'RR3' band, indicating a 'BB-' instrument rating. RATING SENSITIVITIES Factors That Would, Individually or Collectively, Lead to a Negative Rating Action/Downgrade - EBITDA gross leverage above 6.5x on a sustained basis - EBITDA interest coverage consistently below 2.0x - Weakening EBITDA and FCF margins Factors That Would, Individually or Collectively, Lead to a Positive Rating Action/Upgrade - EBITDA gross leverage consistently below 4.7x - EBITDA interest coverage above 3.5x on a sustained basis - Stable, strong EBITDA margins and positive FCF generation through the cycle Liquidity and Debt Structure At end-June 2025, Nouryon's cash balance was USD247 million. It also had full availability of its undrawn USD723 million RCF. The company has no major maturities until 2028 and its current available liquidity sufficiently covers its short-term debt. Issuer Profile Nouryon is a global producer of specialty chemicals headquartered in Ireland and controlled by The Carlyle Group. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Nouryon Finance B.V. senior secured LT BB- Affirmed RR3 BB- Nouryon Holding B.V. LT IDR B+ Affirmed B+ LT IDR WD Withdrawn Nouryon Limited LT IDR B+ Affirmed B+ TIKEHAU CLO XIV: Fitch Assigns 'B-(EXP)sf' Rating on Class F Notes ------------------------------------------------------------------ Fitch Ratings has assigned Tikehau CLO XIV DAC notes expected ratings. The assignment of final ratings is contingent on the receipt of final documents conforming to information reviewed. Entity/Debt Rating ----------- ------ Tikehau CLO XIV DAC A LT AAA(EXP)sf Expected Rating B LT AA(EXP)sf Expected Rating C LT A(EXP)sf Expected Rating D LT BBB-(EXP)sf Expected Rating E LT BB-(EXP)sf Expected Rating F LT B-(EXP)sf Expected Rating Sub Notes LT NR(EXP)sf Expected Rating Transaction Summary Tikehau CLO XIV DAC is a securitisation of mainly senior secured obligations (at least 90%) with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds will be used to redeem the original rated notes and fund a portfolio with a target par of EUR600 million. The portfolio is actively managed by Tikehau Capital Europe Limited. The collateralised loan obligation (CLO) has a 4.5-year reinvestment period and an 8.5-year weighted average life (WAL) test. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'/'B-'. The Fitch weighted average rating factor (WARF) of the identified portfolio is 23.9. High Recovery Expectations (Positive): At least 90% of the portfolio will comprise senior secured obligations. The recovery prospects for these assets are more favourable than for second-lien, unsecured and mezzanine assets. The Fitch weighted average recovery rate of the identified portfolio is 61.2%. Diversified Asset Portfolio (Positive): The transaction will include various concentration limits, including a maximum exposure to the three-largest Fitch-defined industries in the portfolio at 40%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The deal will have a criteria governing the reinvestment similar to those of other European transactions. Its 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 Modelling (Positive): The WAL used for the deal's Fitch-stressed portfolio analysis is 12 months less than the WAL covenant at the issue date, to account for the strict conditions envisaged by the transaction after its reinvestment period. These include passing the coverage tests and the Fitch 'CCC' bucket limitation test after reinvestment, and a WAL covenant that steps down over time, before and after the end of the reinvestment. These conditions would reduce the effective risk horizon of the portfolio during stress periods. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on class A, B and E notes but would lead to downgrade of one notch for the classes C and D notes, and to below 'B-sf' for class F note. Based on the identified portfolio, downgrades may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of default and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the class B to E notes display a rating cushion of two notches, while class F notes have a cushion of three notches. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of up to four notches for the rated notes, and to below 'B-sf' for class E and F notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR across all ratings and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to four notches for the rated notes, except for the 'AAAsf' rated notes. During the reinvestment period, upgrades, which are based on the Fitch-stressed portfolio, may occur on better-than-expected portfolio credit quality and a shorter remaining WAL test, leading to the ability of the notes to withstand larger-than-expected losses for the remaining life. After the end of the reinvestment, upgrades may occur on stable portfolio credit quality and deleveraging, leading to higher credit. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Tikehau CLO XIV DAC The majority of the underlying assets or risk presenting entities have ratings or credit opinions from Fitch and other nationally recognised statistical rating organisations and European Securities and Markets Authority-registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and other rating agencies to assess the asset portfolio information or information on the risk presenting entities. Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for its analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for Tikehau CLO XIV DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. ========= I T A L Y ========= EFESTO BIDCO: Fitch Assigns 'B' LongTerm IDR, Outlook Negative -------------------------------------------------------------- Fitch Ratings has assigned Italy-based Efesto Bidco S.p.A. (Forgital Group) a final Long-Term Issuer Default Rating (IDR) of 'B'. The Outlook is Negative, instead of Stable when we assigned the expected rating. Fitch has also assigned Forgital Group's senior secured notes, jointly issued with Efesto US, LLC, a final rating of 'B' with a Recovery Rating of 'RR4'. The IDR is constrained by Forgital Group's small scale, concentrated customer base, material exposure to cyclical markets and high leverage following its LBO. The rating is supported by the group's strong position in a niche market, sustainably healthy EBITDA margins and long-term relationships with main customers, including Rolls-Royce plc (BBB+/Positive). The Outlook revision reflects expected constrained EBITDA growth and delayed improvement in EBITDA leverage versus its initial forecast, despite solid demand in the aerospace industry. Fitch forecasts free cash flow (FCF) generation to be volatile due to higher interest payments and capex. Key Rating Drivers Postponed Leverage Improvement: Fitch expects EBITDA leverage for the group to rise to 7.2x by end-2025 and improve to 6.3x by end-2026. This is weaker than its previous expectation of EBITDA leverage below the downgrade sensitivity of 6.0x from 2026. Fitch now forecasts EBITDA leverage to be below 6.0x from 2027. Weaker EBITDA generation in 2025 compared with its initial forecast is driven by softening demand in the industrial subsector (25% of revenue in 2024) and a weaker US dollar. Fitch now conservatively forecasts a limited improvement in EBITDA in 2026. A further delay in deleveraging would lead to a downgrade. Healthy Margins, Upward Trend: EBITDA margins for Forgital Group have been solid and similar to those of some industrial supplier peers in the sector. Fitch-defined EBITDA margins were 17% in 2023 and 22.5% in 2024, supported by increasing exposure to aerospace, which carries higher margins than industrials. Improved operating leverage accompanied by cost-saving initiatives, primarily due to lower energy expenses, also supported margin expansion. Fitch forecasts EBITDA margins to remain comfortably above 20% in 2025-2028. Eroded FCF to Improve: The group's FCF fell in 2024, despite healthy EBITDA margins, due to higher working capital outflows and slightly higher capex than expected. Fitch expects FCF to be under pressure in 2025 from high interest payments following the new notes issue, constrained EBITDA generation and capex. Fitch forecasts the FCF margin to be neutral to positive from 2026 due to high interest payments and annual capex of about EUR35 million. Evolving End-Markets Diversification: Forgital Group's exposure to markets has shifted over the last four years to a higher share of aerospace (74% of revenue in 2024) from industrials, which has been affected by sluggish demand. Fitch expects a solid aerospace order book to support 75%-80% of revenues during 2025-2028 and, therefore, stronger profitability. Nevertheless, commercial aerospace exposure (50% of group revenue in 2024) may affect performance due to its highly cyclical nature. Concentrated Customer Base: Forgital Group's main customer is Rolls-Royce, which accounts for about 40% of its revenue. This presents high customer concentration risk, although offset by the strong, long-term nature of the relationship, the robust recovery in Rolls-Royce's operating performance and the difficulty of replacing Forgital Group in the short term on most programmes due to certification requirements and other barriers to entry. Solid Backlog: At end-2024, the estimated order backlog in aerospace, with contracts until 2045, reached EUR4.8 billion, more than 10x its expected aerospace revenue in 2025. The solid backlog gives the group strong revenue visibility in the sector, where long-term contracts dominate. The majority of the backlog relates to widebody aircraft and the rest to narrowbody and other aircraft. Good Market Position; Small Scale: The group is one of the leading producers of metallic forgings and large rings for aerospace and industrial markets. Nevertheless, Forgital Group's small size and scale are constraints on its credit profile as they restrict its ability to absorb cost overruns. The main mitigating factors are long-term relationships with major customers and the solid role the group plays in the engine supply chain. Industry Trends Support Growth: The group's rising exposure to aerospace reflects the industry rebound, higher air traffic and production rates at original equipment manufacturers. The strong rebound in demand for narrowbodies (about 11% of revenue in 1H25) and a gradual recovery widebodies (about 40%) contribute to improving operating results. Favourable demand dynamics support its forecast of a high single-digit revenue rise in 2026-2028. Peer Analysis Forgital Group is similar in size to Aernnova Aerospace S.A.U. (B/Negative) and Ovation Parent, Inc., but is much smaller than higher-rated peers, such as MTU Aero Engines AG (BBB/Stable) and Howmet Aerospace Inc. (BBB+/Stable). The group and Aernnova are reliant on one main customer, in Rolls-Royce and Airbus, respectively, for a material share of their revenue and backlog. Forgital Group's healthy EBITDA margin is similar to Ovation's and some industrials peers, such as EVOCA S.p.A. (B/Negative) and Ammega Group B.V. (B-/Negative). Forgital Group's profitability is stronger than Aernnova's. Forgital Group's forecast high EBITDA leverage of over 6.0x at end-2025 and end-2026 is commensurate with that of The NORDAM and Ammega. However, expected improvement of leverage towards 5.5x by end-2027 compares well with that of 'B' rated issuers like EVOCA. Key Assumptions - Flat revenue in 2025, followed by high single-digit revenue rise during 2026-2028, supported by expected ramp-up under certain programmes and new orders - EBITDA margin to slightly decrease to 21.6% in 2025 and gradually increase to 23%-24% to 2028, supported by higher volumes and cost savings - Capex of about EUR35 million annually during 2025-2028 - Equity issuance of EUR827 million in 2025 - New bond issue of USD825 million (EUR710 million equivalent) in 2025 at fixed interest rate of 7.5% - Repayment of an existing bond of USD505 million in 2025 - No M&A or dividend payments Recovery Analysis The recovery analysis assumes that Forgital Group would be reorganised as a going concern (GC) in bankruptcy rather than liquidated. Fitch assumes a 10% administrative claim. Fitch estimates the going concern EBITDA at EUR90 million, reflecting its view of a sustainable, post-reorganisation EBITDA on which it bases the valuation of the group. Fitch applies a multiple of 5.5x to going concern EBITDA to calculate an enterprise valuation after restructuring. This is comparable with multiples applied to aerospace and defence peers. It reflects the group's leading market position in the niche industry, long-term and successful cooperation with main customer Rolls-Royce, high barriers to entry and healthy profitability. The multiple reflects the group's limited geographical diversification and constrained scale. Fitch deducts about EUR35 million from the enterprise valuation for the use of factoring, in line with Fitch's criteria. Fitch estimates the amount of senior debt claims at EUR838 million, including a proposed EUR125 million super senior secured revolving credit facility (RCF), EUR710 million equivalent senior secured notes and an additional EUR3.7 million unsecured debt. Its waterfall analysis generates a ranked recovery for Forgital Group's notes equivalent to 'RR4', leading to a 'B' rating. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA leverage above 6.0x on a sustained basis - Neutral to negative FCF - EBITDA interest coverage sustainably below 2.0x - Loss of main customer or pricing pressure leading to structural deterioration of EBITDA margin Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Improvement of EBITDA leverage to below 6.0x would support a revision of the Outlook to Stable - Increased customer and market diversification while maintaining heathy profitability - EBITDA leverage below 5.0x on a sustained basis - FCF margin above 3% - EBITDA interest coverage sustained above 3.0x Liquidity and Debt Structure At end-June 2025, Forgital Group had readily available cash of EUR26 million (net of Fitch-restricted cash of about EUR10 million). This was sufficient to cover expected negative FCF of about EUR6 million in the next 12 months. The group signed an RCF of EUR125 million due August 2031 alongside its notes issue, supporting its liquidity. Fitch-defined short-term debt at end-June 2025 comprised drawn non-recourse and recourse factoring use of about EUR43.5 million. The debt structure, after the notes issue, consists primarily of about EUR710 million of senior secured notes (equivalent of USD825 million) due February 2032. It does not have material scheduled debt repayments until 2032. Issuer Profile Forgital Group is the leading manufacturer of advanced metallic forgings and large rolled rings for aerospace and industrial markets. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Efesto US, LLC senior secured LT B New Rating RR4 B(EXP) Efesto Bidco S.p.A. LT IDR B New Rating B(EXP) senior secured LT B New Rating RR4 B(EXP) =================== K A Z A K H S T A N =================== FORTEBANK JSC: Fitch Rates New USD Add'l Tier 1 Notes 'B(EXP)' -------------------------------------------------------------- Fitch Ratings has assigned ForteBank JSC's (Forte) upcoming issue of US dollar-denominated perpetual additional Tier 1 (AT1) notes an expected long-term rating of 'B-(EXP)'. The notes will rank junior to the bank's unsubordinated obligations. The final rating is contingent on the receipt of final documents conforming to information already received. Key Rating Drivers The notes are rated four notches below Forte's Viability Rating (VR) of 'bb'. This is the highest rating that can be assigned to deeply subordinated notes with fully discretionary coupon omission issued by banks with a VR anchor of 'bb', under Fitch's Bank Rating Criteria. This comprises two notches for the notes' high loss severity due to their deep subordination, and two notches for additional non-performance risk relative to the VR, given a high write-down trigger and fully discretionary coupons. The notes are non-cumulative, fixed-rate resettable AT1 debt securities, which are expected to qualify as regulatory AT1 capital. The notes have a full coupon omission option at the bank's discretion and full or partial write-down triggers if the bank's regulatory common equity Tier 1 (CET1) capital adequacy ratio falls below the minimum requirement of 5.5%. Under the local banking legislation, the Agency of the Republic of Kazakhstan for Regulation and Development of Financial Market also has the power to trigger a write-down if it deems the bank as insolvent, such as after prolonged breaches of mandatory capital ratios or a persistent inability to meet the bank's debt obligations. Fitch believes the risk of coupon omission is more likely if the bank's common equity Tier 1 (CET1) capital ratio falls below the additional capital buffer requirements established by the regulator. This risk is mitigated by Forte's healthy profitability and reasonable headroom over capital minimums. Forte's regulatory CET1 capital ratio was 13.8% as of end-August 2025, which was comfortably above the 8% regulatory minimum requirement (inclusive of the capital conservation buffer). The notes have no formal redemption date. However, Forte has a call option from the fifth anniversary of the issue date up to the first coupon reset date and, thereafter, on each subsequent interest payment date, subject to the regulatory approval. For Forte's key rating drivers and sensitivities, see 'Fitch Affirms ForteBank at 'BB'/Stable on Announced Acquisition of Home Credit Kazakhstan' published on 22 July 2025. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The AT1 debt would be downgraded if the bank's VR was downgraded by more than one notch. If the VR was downgraded by one notch to 'bb-', the notes' rating could be affirmed, as the minimum notching for these instruments reduces to three notches for VRs at 'bb-' and below, versus four notches at 'bb'. The AT1 debt could be downgraded if the bank fails to maintain reasonable headroom over the minimum capital adequacy ratios. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade The AT1 securities would be upgraded if the bank's VR was upgraded. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating ----------- ------ ForteBank JSC junior subordinated LT B-(EXP) Expected Rating =================== L U X E M B O U R G =================== B&M EUROPEAN: S&P Places 'BB+' LongTerm ICR On Watch Negative ------------------------------------------------------------- S&P Global Ratings placed its 'BB+' long-term issuer and issue ratings on B&M European Value Retail S.A. (B&M) and its debt on CreditWatch with negative implications. S&P said, "We intend to resolve the CreditWatch after B&M announces its results for the first half of fiscal 2026 (on Nov. 13, 2025). At that time, we will assess the group's cash flow generation fiscal year-to-date and prospects for the full year and beyond, financial policy under the new leadership, and its management and governance." B&M on Oct. 20, 2025, announced its second cut to group-adjusted (before International Financial Reporting Standard [IFRS] 16) EBITDA guidance for fiscal 2026 (ending March 31) attributing the GBP40 million reduction to the range shared on Oct. 7, 2025, to the cost-of-goods-sold (COGS) accounting error after an operating system update earlier in the year. The company also informed of its CFO's resignation and the board's intention to commission a third-party review of the accounting matter. Before that, on Oct. 7, 2025, the group announced the "Back to B&M Basics" turnaround plan under its new CEO (who started on June 16, 2025) and lowered the earnings guidance to GBP510 million-GBP560 million, compared with the GBP621 million midpoint of the analyst consensus range communicated on June 4, 2025. Weak like-for-like sales and transaction volumes in B&M's U.K. stores, uncertainty in operational turnaround under the new executive leadership, and a likely increase in exceptional costs could lead to weaker S&P Global Ratings-adjusted credit metrics than S&P previously anticipated. S&P said, "B&M's trading performance in fiscal 2026 has so far been weaker than our forecast. On Oct. 20, 2025, B&M revised its management-adjusted (pre-IFRS 16) EBITDA guidance for fiscal 2026 to GBP470 million-GBP520 million, due to a miscalculation of second-quarter gross margin run rates, after an operating system update that led to GBP7 million of overseas freight costs not correctly recognized in COGS. This followed another profit warning on Oct. 7, 2025, with a cut in full-year EBITDA estimate to GBP510 million-GBP560 million. This was a material deviation from the analyst consensus range of GBP569 million-GBP646 million provided at the fiscal 2025 preliminary earnings announcement on June 4, 2025 which the group confirmed at the time was fairly reflecting operating cost inflation. The group also guided half-year leverage slightly above its 1.0x-1.5x target range, due to weak earnings and seasonal working capital requirements ahead of its Golden Quarter. "We will publish our updated base case at the time of CreditWatch resolution when we know more about the group's financials for the first half of the fiscal year and the extent of the identified accounting irregularities. Pro forma for the decline in EBITDA matching the GBP495 million midpoint of the latest company guidance (without factoring in any exceptional costs), our previously published forecast for fiscal 2026 would result in S&P Global Ratings-adjusted debt-to-EBITDA of 2.9x and funds from operations to debt of 24.4%. Depending on the extent of our view of the group's medium-term earnings prospects and how far B&M's credit metrics will deviate from our base-case projections for 2026-2028, we may revise our financial risk profile assessment or our rating on B&M, or both. "Free operating cash flow (FOCF) generation and capital allocation under the new leadership will be key to our assessment of B&M's creditworthiness. FOCF generation in the first half, combined with the expectations for the full year and beyond as the group proceeds with its business turnaround initiatives under the new CEO will inform our opinion. This would also include any exceptional costs related to the remedy of the accounting error and risk management systems. In addition, we will consider any disclosures from the group regarding capital allocation priorities, financial policy, and plans for shareholder returns. "The numerous expected and unexpected executive team changes in recent months, consecutive profit warnings issued in fiscal 2025 and fiscal 2026, and the recent discovery of accounting irregularities raise our concerns with regard to B&M's management and governance practices. B&M announced the departure of its CFO along the said accounting error after an operating system update, who will remain with the group until an appropriate successor is found. This announcement follows Mr. Schmidt's acting as an interim CEO from April 30 to June 15 of this year covering the period between the group's previous CEO's retirement (announced on Feb. 24, 2025) and the new CEO's start. We also note the new Group Trading Director Mr. Bilton, who was previously the Retail Director, commenced work in the end of fiscal 2025 succeeding Mr. Arora, the last shareholder family member assuming management role in the business. These changes took place alongside the earnings guidance revisions during fiscal 2025 and fiscal 2026. While the actual management-adjusted (pre-IFRS 16) EBITDA of GBP620 million in fiscal 2025 achieved the lower end of the initial guidance for the year, the group has changed its guidance ranges multiple times during the year. In our view, the frequency of changes in the senior executive team and board of directors could affect the group's stability, ability to adjust strategy to the prevailing market conditions, and ability to provide adequate risk management and oversight. "The negative CreditWatch reflects the increased risk of a downgrade following the announcements that B&M has made since we assigned a negative outlook on March 19, 2025. We intend to resolve the CreditWatch once we gain greater visibility on the group's cash flow generation and financial policy upon reviewing its interim results, which it will announce on Nov. 13, 2025, and fully incorporate the latest developments and risks into our analysis, whether they relate to B&M's operating performance, financial metrics, or our management and governance assessment." Environmental, social, and governance (ESG) credit factors for this change in credit rating/outlook and/or CreditWatch status: -- Transparency and reporting ELEVING GROUP: Fitch Rates EUR275MM 9.5% Secured Bonds 'B' ---------------------------------------------------------- Fitch Ratings has assigned Eleving Group's issue of EUR275 million, 9.5% senior secured bonds due 2030 a final rating of 'B' and Recovery Rating of 'RR4'. Eleving raised EUR275 million with a five-year maturity, which will be unconditionally and irrevocably guaranteed on a joint and several basis by its several material subsidiaries. The guarantors include companies from Europe, the Caucasus region, and Mogo Auto Limited (Kenya) in sub-Saharan Africa, but exclude subsidiaries in Uzbekistan and certain other African countries. In addition, the bonds are secured by pledges on the equity and loan portfolios of these material subsidiaries. Eleving is also making a voluntary exchange offer to holders of its existing EUR150 million bonds due October 2026 (ISIN: XS2393240887). The rating is in line with the expected rating published on 29 September 2025 (see Fitch Rates Eleving's Proposed Senior Secured Bonds 'B(EXP)'/'RR4'). Key Rating Drivers The rating is equalised with Eleving's Long-Term Issuer Default Rating (IDR) of 'B', due to Fitch's expectation of average recoveries, as reflected in the 'RR4' Recovery Rating. This is because the bonds' structural subordination to outstanding debt at operating entities offsets their secured nature, in its view. The bonds will represent a senior secured obligation of Eleving, ranking pari passu with its existing similar issuance. Proceeds from the new bonds are primarily being used to refinance Eleving's remaining October 2026 bond maturities that are not exchanged in the exchange offer, refinance Mintos platform liabilities, and for general corporate purposes. Fitch expects that the rise in Eleving's leverage due to the issue will be manageable within the current rating. The new issue will extend the maturity of Eleving's borrowings. The key rating drivers and sensitivities for Eleving's Long-Term IDR are outlined in its rating action commentary published on 29 May 2025 (see Fitch Revises Eleving's Outlook to Positive; Affirms Long-Term IDR at 'B'). RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A downgrade of Eleving's Long-Term IDR would likely be mirrored in its senior secured bond rating. Lower recovery assumptions due to, for instance, operating entity debt increasing in importance relative to Eleving's rated debt or worse-than-expected asset-quality trends (which could lead to larger asset haircuts), could lead to below-average recoveries and Fitch to notch down the rated debt from the company's Long-Term IDR. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade An upgrade of Eleving's Long-Term IDR would likely be mirrored in its senior secured bond rating. Higher recovery assumptions due to, for instance, operating entity debt diminishing in importance compared with Eleving's rated debt instruments, could lead to above-average recoveries and Fitch to notch up the rated debt from the company's Long-Term IDR. Date of Relevant Committee 28-May-2025 ESG Considerations Eleving has an ESG Relevance Score of '4' for group structure, reflecting its view about the appropriateness of Eleving's organisational structure relative to the company's business model, intra-group dynamics and risks to its creditors. This has a moderately negative impact on the credit profile and is relevant to the rating in conjunction with other factors. Eleving has an ESG Relevance Score for Customer Welfare of '4'. Eleving's exposure to high-cost credit means that its business model is sensitive to regulatory changes, like lending caps, and conduct-related risks. These issues have a moderately negative impact on the credit profile and are relevant to the rating in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on Eleving, either due to their nature or the way in which they are being managed. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Eleving Group senior secured LT B New Rating RR4 B(EXP) ENERGUATE TRUST 2: Fitch Hikes LongTerm IDRs to BB+, Outlook Stable ------------------------------------------------------------------- Fitch Ratings has upgraded the Long-Term Local and Foreign Currency Issuer Default Ratings (IDRs) of Energuate Trust 2.0 (Energuate 2.0) and Threelands Energy, Ltd. Sarl (Threelands) to 'BB+' from 'BB'. The Rating Outlooks are Stable following the upgrades. Fitch has also upgraded Energuate 2.0's senior unsecured notes to 'BB+' from 'BB' and Threelands' senior unsecured notes to 'BB' from 'BB-.' Today's actions follow Fitch's recent upgrade of Guatemala's sovereign FC and LC IDR rating to 'BB+' from 'BB' and assignment of a Stable Outlook. Key Rating Drivers Energuate 2.0's upgrade and Stable Outlook assignment align parallel actions on the sovereign. Energuate 2.0 issues bonds on behalf of Energuate, which is the commercial name for the combined services of Guatemala's two largest rural electricity distribution companies. The sovereign linkage derives from Energuate's systemic government subsidy support and material government counterparty exposure due to the low-income and rural service area. Energuate's financial profile is driven by a regulated tariff that supports gross leverage (total debt/EBITDA) of around 3.2x and adequate liquidity. Elevated non-technical losses and security challenges temper these strengths. Threelands' upgrade and Stable Outlook assignment result from its strong linkage, per Fitch's "Parent and Subsidiary Linkage Criteria", with its primary and stronger subsidiary Energuate, with which it is consolidated and has an open relationship. Energuate's upgrade supports uplift at its holding company as it contributes nearly 98% of consolidated EBITDA and represents 70% of total debt, driving consolidated gross leverage of 4x-4.5x, and EBITDA/interest coverage over 3x, aligned with a strong 'BB' category rating. Energuate 2.0 serves as a proxy rating reference for Energuate, and thus is the subsidiary reference for comparison with Threelands. Fitch rates Threelands' senior unsecured notes one notch below its 'BB' IDR due to structural subordination to operating subsidiary debt and the risk that Energuate 2.0's loan covenants could restrict dividends payments to Threelands, potentially impairing interest and debt service coverage. RATING SENSITIVITIES Energuate Trust 2.0: Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A negative action on Guatemala's sovereign rating; - A significant weakening in the country's electricity regulation system, either through tariff adjustments or a material change in subsidies received by Energuate 2.0; - Weaker operational results due to higher-than-expected energy losses and lower-than-anticipated tariff increases; - A significant interference in Energuate's capital structure that results in debt/EBITDA sustained at 5.5x or greater. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - A positive rating action on the sovereign, in combination with strengthening of the business profile and sustained debt/EBITDA below 3.5x. Threelands Energy Ltd. Sarl: Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A downgrade or Outlook change for Energuate 2.0's ratings; - Threelands leverage debt/cash distribution sustained above 4.0x over the rating horizon while consolidated leverage measured as total debt/EBITDA is above 5.5x on a sustained basis; - An adverse deconsolidation of Threelands to primary operating subsidiary Energuate. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Under the current structure, an upgrade of Threelands is unlikely without an upgrade of the primary consolidated entity proxy rating, Energuate 2.0. Issuer Profile Energuate Trust 2.0 issues bonds on behalf of Guatemala's two largest rural electricity distribution companies, DEORSA and DEOCSA, known commercially as Energuate, serving about 2.5 million regulated customers, or 74% of Guatemala's population. Threelands Energy, Ltd. Sàrl is the majority owner of Energuate, the commercial name for Guatemala's two primary rural distribution companies, DEORSA and DEOCSA. Threelands also owns Guatemala-based Redes Electricas de Centroamerica, S.A., and Comercializadora Guatemalteca Mayorista de Electricidad, S.A. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Energuate Trust 2.0 LT IDR BB+ Upgrade BB senior unsecured LT BB+ Upgrade BB Threelands Energy Ltd s.a.r.l. LT IDR BB+ Upgrade BB senior unsecured LT BB Upgrade BB- ORION SA: S&P Affirms 'BB' ICR & Alters Outlook to Negative ----------------------------------------------------------- S&P Global Ratings revised its outlook on Luxembourg-based Orion S.A. to negative from stable. S&P also affirmed its 'BB' issuer credit rating and 'BB' issue rating on the company's debt, with a recovery rating of 3 (55%). The negative outlook reflects the possibility of a downgrade in the next 6-12 months if ongoing weak demand leads to adjusted FFO to debt failing to sustainably recover above 20%. S&P said, "We anticipate continued weak demand in Luxembourg-based Orion S.A.'s key end markets, driven by subdued Western tire and industrial demand in 2025, as recently indicated by the company's profit warning. "Under our revised base case, we anticipate a possible 5% decline in the company's revenue to approximately $1.8 billion in 2025, with S&P Global Ratings-adjusted free operating cash flow (FOCF) remaining relatively subdued. "Consequently, S&P Global Ratings-adjusted funds from operations (FFO) to debt could fall to about 15% in 2025 (20.9% in 2024), a level below our expectations for the current rating. "Orion's recent profit warning led us to revise our base case downward, and we now anticipate weaker credit metrics for 2025. Orion recently revised its market guidance with company-adjusted EBITDA between $220 million-$235 million, down from $270 million-$290 million previously, amid ongoing weakness in Western tire and industrial markets, adverse specialty mix, and negative oil-related inventory revaluation effects. At the same time, management anticipated a gradual improvement from 2026 as market conditions normalize and new capacity becomes operational. Under our revised base case we anticipate the group's top line could decline by about 5% to $1.8 billion in 2025 (from $1.9 billion in 2024). This decline will pressure Orion's profitability and cash generation for 2025, challenging its deleveraging prosects and credit metrics. For 2025 we anticipate the company's S&P Global Ratings-adjusted FFO to debt could fall to about 15%. We see FFO to debt sustainably above 20% as commensurate for the 'BB' ratings on Orion. Moreover, we anticipate recovery prospects in 2026 are relatively uncertain, primarily due to the group's significant exposure to automotive and tire end markets, which currently remain soft in Orion's key western markets. "Under our revised base case we anticipate the company's S&P Global Ratings-adjusted EBITDA may decrease to about 13.0%-13.5% in 2025. We regard this level of profitability relatively low if compared to the group's historical average of about 16%. During the first half of 2025, Orion's adjusted EBITDA fell approximately 16% compared to the same period in 2024 to $135 million. Volumes softened in the second quarter of 2025, falling slightly from the already low levels recorded in the first quarter. Orion's operating performance continues to be challenged by factors including increased tire imports into the U.S. and Europe. This was driven by the U.S. tire channel, including dealers and distributors, rushing to build inventory from Asia before tariffs took effect, as well as soft industrial activity in Europe and destocking trends in the polymer and coatings markets. Furthermore, a significant drop in feedstock prices by 15%-20% resulted in negative inventory revaluation, compressing margins in both the rubber and specialty segments. "We forecast a gradual recovery from 2026, supported by new production capability ramping up, cost control, and improving market dynamics. However, the pace and speed of this recovery remain largely uncertain. Under our revised base case we currently estimate S&P Global Ratings-adjusted EBITDA of about $305 million in 2026 and $330 million in 2027 (from $235 in 2025 and $314 million in 2024), mostly driven by normalizing demand through improved usage, normalizing feedstock pass-through, and gradually increasing contributions from the La Porte, Texas conductive carbon black plant and the Huaibei, China specialty facility. "Weaker-than-anticipated cash generation weighs on the company's credit metrics. We forecast S&P Global Ratings adjusted FOCF to be relatively neutral to modestly negative in 2025 (from $16.6 million in 2024 and $89.2 million in 2023). Orion's lower cash generation in 2025 is a result of both lower earnings and relatively higher capital expenditure (capex) reaching $150 million in 2025 (from $207 million in 2024 and $173 million in 2023) as the company concludes ramping up the La Porte and Huaibei facilities. We understand that management intends to reduce capex to $110 million by 2026, prioritizing cash preservation, debt reduction, and operating efficiency, and terminating increased capacity plans. As a result we anticipate the company's cash generation will improve substantially from 2026, reaching about $90 million. Positively, we note the company will freeze share buybacks in the medium term in order to focus on deleveraging and cash generation amid current difficulties. We forecast S&P Global Ratings-adjusted debt to EBITDA to rise to about 4.6x in 2025, from 3.3x in 2024, and FFO to debt to decline to roughly 15%, well below our 20% downside threshold for the current rating. We expect leverage to ease toward 3.4x in 2026 and FFO to debt to recover to 20%-23% as earnings and cash generation improve. "Following management's negotiation of covenant relief and EUR50 million increase in the revolving credit facility (RCF) availability, we now consider Orion's liquidity as adequate. In September 2025, Orion amended its credit agreement to add a EUR50 million incremental revolving facility and reset the first-lien leverage covenant to 5.0x until December 2026 from 4.0x. We understand that a potential covenant breach will constitute an EOD under the company's debt documentation. The first-lien leverage covenant will drop to 4.5x from year-end 2026 until maturity. We regard these actions as providing near-term flexibility and help the group to navigate through a challenging market environment with an adequate level of liquidity and headroom under the financial covenants. As of the end of June the company's cash balance was $42.6 million, virtually unchanged from Dec. 31, 2024. Taking into account the total RCF availability of $108.5 million, including the additional $50 million becoming available in September 2025, Orion's liquidity sources over its uses remains at about 1.4x, a level we see as commensurate with our assessment of adequate liquidity. "The negative outlook indicates the possibility that we may downgrade Orion within the next 6-12 months. "We could lower our ratings on Orion if its S&P Global Ratings-adjusted FFO to debt remains below 20% on the back of a protracted weakness in earnings and cash generation. This could occur, for example, if end-market demand remains subdued, additional margin pressure arises from oil-related inventory effects, or cost-saving measures and specialty capacity ramp-ups underperform expectations. Moreover, a deterioration in the company's liquidity would put immediate pressure on the ratings, all else being equal. "We could revise the outlook to stable if Orion demonstrates a sustained recovery in earnings and cash flow, with FFO to debt exceeding 20%, supported by improving end-market conditions, normalized feedstock pricing, and a reduction in working capital intensity." =========== R U S S I A =========== NAVOIYAZOT JSC: Fitch Assigns 'BB-' LongTerm IDR, Outlook Stable ---------------------------------------------------------------- Fitch Ratings has assigned JSC Navoiyazot a final Long-Term Issuer Default Rating (IDR) of 'BB-'. The Outlook is Stable. The rating action follows confirmation that Navoiyazot remains under state ownership rather than being transferred back to former parent JSC Uzkimyosanoat. As a result, Fitch applies Government Related Entities (GRE) Rating Criteria. Navoiyazot's 'BB-' IDR is notched down by one notch from that of Uzbekistan (BB/Stable), its sole ultimate shareholder, reflecting its assessment of 'Extremely Likely' expectations for state support. Fitch assesses its Standalone Credit Profile (SCP) at 'b-'. Navoiyazot's SCP reflects its small asset base and limited revenue diversification. In addition, Navoiyazot's assets require new investments for modernisation. The SCP is constrained by weak financial flexibility and high leverage, with EBITDA gross leverage around 6x in 2025 and averaging 4.5x in 2026-2028 as well as an evolving operating environment in Uzbekistan and weak corporate governance. Key Rating Drivers Top-Down Rating Approach: Navoiyazot's IDR is notched down by one notch from the rating of Uzbekistan (BB/Stable), its sole ultimate shareholder. The company's overall GRE support score is 35, which underlines 'Extremely Likely' expectations for state support, according to its GRE Rating criteria. Responsibility to Support: Navoiyazot's decision-making and oversight by the government are 'Strong', given the state's ultimate 100% ownership and its control over the company's strategy and investment programme. The state also regulates certain fertiliser prices. Fitch assesses precedents of support as 'Very Strong' as 72% of Navoiyazot's total debt is guaranteed by the state and funding is either from state-owned banks or Ministry of Economy and Finance. Fitch expects the share of state-backed debt to decline as the company plans to issue debt with international banks or capital markets to fund expansion without state guarantees. Other forms of support included about USD110 million of debt-to-equity conversion. The state has provided about USD29 million of support loan in 2025 with further USD130 million pending for allocation in 2025-2026. Incentive to Support: Fitch assesses the preservation of government policy role factor as 'Strong' as Navoiyazot mainly produces fertilisers for the agriculture industry, which is key for the local economy. The company also produces essential sodium cyanide for Uzbek miners. Fitch views contagion risk as 'Strong', reflecting Navoiyazot's default is likely to disrupt access to, or raise the cost of financing for the government or its other GREs. Growth and Modernisation Strategy: Navoiyazot has ambitious capex plans to modernise its Soviet-era facilities emphasising energy and cost efficiency, as well as expanding capacity and products. The modernisation programme and growth capex are estimated at USD360 million. The company plans to fund this by external borrowings with no state guarantees, with most modernisation and capacity growth projects scheduled for 2026-2028. As a result, the operational benefits and margin improvement from the projects are likely to materialise closer to 2029. Profitability Normalisation: Profitability weakened in 2024 due to declining fertiliser prices and rising domestic energy costs. Fitch forecasts EBITDA at USD150 million in 2025, increasing to around USD190 million in 2026-2028, supported by higher state-set domestic prices of sodium cyanide offset by anticipated energy tariff increases. Limited Deleverage Capacity: Fitch expects debt to rise in 2028 as capex peaks, constraining deleveraging capacity. Fitch forecasts EBITDA gross leverage to be around 6x in 2025 (6.4x in 2024) and decline to an average of 4.5x in 2026-2028, primarily due to the UZS1,200 billion debt-to-equity conversion expected in 2026. Additional support comes from earnings recovery and flow through from the lower-cost solar power offtake. Peer Analysis Navoiyazot has a far smaller scale and weaker diversification than most Fitch-rated EMEA fertiliser producers, mitigated by its status as the sole domestic producer of fertilisers and dominant share in landlocked Uzbekistan, with high transportation costs for competing importers. The company has relatively low electricity and natural gas prices compared with the market. However, its assets require substantial modernisation, which reduces its cost-efficiency relative to its peers. The group's ammonia nitrate and urea assets are in the second quartile of the respective CRU cost curves. Root Bidco S.a.r.l. (Rovensa; B-/Stable) operates on a similar scale to Navoiyazot but has greater diversification across products and raw materials. It has price and cash flow visibility as well as steady growth, supported by the essential nature of its products for crop growth and its strategic focus on niche products. Navoiyazot's commodity exposure subjects it to more volatility in feedstock and selling prices than Rovensa. Both companies maintain higher margins than other peers. However, Rovensa has higher debt burden and higher leverage at 9.9x in 2024. AI Plex (Luxembourg) S.a r.l. (B-/Negative) is larger and more geographically diversified than Navoiyazot. However, it is exposed to raw material price volatility and has materially elevated leverage due to its capex programme and weak chemical pricing. The company's Negative Outlook reflects refinancing risk related to maturities due in 2026 in a difficult chemical market. Key Assumptions - Fertiliser prices assumptions in line with Fitch's price deck - EBITDA margin of about 29%-30% in 2025-2028 - Debt-to-equity conversion of UZS1,200 billion in 2026 - Dividend payout of 50% between 2025 and 2028 - Capex of about UZS270 billion in 2025, UZS1,150 billion in 2026-2027, UZS2,200 billion in 2028 RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Material weakening of links and support from the state - Unremedied liquidity issues - EBITDA gross leverage above 5.5x on a sustained basis would be negative for the SCP, but not necessarily the IDR Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Positive rating action on the sovereign - Strengthening ties between the company and the state - Improvement in the liquidity profile and EBITDA gross leverage below 4.5x on a sustained basis For Rating Sensitivities for Uzbekistan, see Rating Action Commentary 'Fitch Upgrades Uzbekistan to 'BB'; Outlook Stable', dated 26 June 2025 Liquidity and Debt Structure As of 31 December 2024, Navoiyazot had a cash balance of UZS31 billion with no access to revolving credit facilities. Fitch expects free cash flow (FCF) generation in 2026-2028 to be negative due to substantial capex and low dividend flexibility. The company has received UZS350 billion (USD29 million) loan in 2025 from the state. It has average annual maturities of about UZS2,500 billion over the next two years, which Fitch expects will be refinanced by state banks. Issuer Profile JSC Navoiyazot is a state-owned fertiliser producer in Uzbekistan. Public Ratings with Credit Linkage to other ratings Navoiyazot's rating is notched down by one notch from the sovereign's. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations JSC Navoiyazot has an ESG Relevance Score of '4' for Governance Structure due to limitations of board independence and effectiveness, which has a negative impact on the credit profile, and is relevant to the rating in conjunction with other factors. The company has an ESG Relevance Score of '4' for Financial Transparency due to delays in the publication of IFRS accounts compared with international best practice and the absence of interim IFRS reporting, which has a negative impact on the credit profile, and is relevant to the rating in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Its ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the decision. Entity/Debt Rating Prior ----------- ------ ----- JSC Navoiyazot LT IDR BB- New Rating BB-(EXP) =========== T U R K E Y =========== ZORLU ENERJI: Fitch Alters Outlook on 'B+' LongTerm IDR to Negative ------------------------------------------------------------------- Fitch has revised Zorlu Enerji Elektrik Uretim A.S.'s Outlook to Negative from Stable, while affirming its Long-Term Issuer Default Rating (IDR) at 'B+'. The Outlook revision reflects weak interest coverage ratios, due to slower-than-expected deleveraging on a gross debt basis, and depleted leverage headroom in 2025-2026. EBITDA interest rate coverage consistently below 2.0x or higher EBITDA net leverage than forecast would lead to a rating downgrade. The IDR reflects Zorlu's limited scale of operations, with concentration on a single market (Turkiye, BB-/Stable), increasing exposure to merchant prices as feed-in tariffs gradually expire, and exposure to FX risk, but also a high contribution of regulated and quasi-regulated businesses to EBITDA (more than 80% based on its estimates), satisfactory regulatory frameworks for electricity distribution and contracted renewables. Key Rating Drivers Weaker Financial Profile: Fitch forecasts adjusted EBITDA interest coverage to average 1.8x in 2025-2026, which is low for the 'B+' rating and drives the Negative Outlook. More of the new debt issued in 2024 was used for growth than to debt repayment, compared with the original plan, resulting in net debt USD125 million higher than its forecast at end-2024. Fitch therefore expects interest payments to exceed 63% and 50% of EBITDA in 2025 and 2026, respectively (66% in 2024). Fitch forecasts EBITDA interest coverage to improve to 2.3x in 2027-2028, due to higher EBITDA and lower debt. A slower improvement than forecast would lead to a downgrade of the rating. Fitch expects EBITDA net leverage to average 4.1x in 2025-2026, improving to 3.6x in 2027-2028. Fitch expects total debt to reach USD1.3 billion by end-2026. The rating case assumes all remaining asset disposal proceeds are used for debt repayment, in line with Zorlu's medium-term target to gradually lower net debt/EBITDA to 3.0x. Fitch excludes from EBITDA the non-cash portion of the indexation difference from receivables related to service concession arrangements of the distribution business, which totalled USD53 million in 2024. Higher Capex Affects FCF: Zorlu increased capex in 2025, mainly in distribution. Fitch forecasts annual capex of USD122 million (TRY5.1 billion) in 2025-2026, and USD85 million (TRY4.45 billion) in 2027-2028. Fitch understands from management that it has some capex flexibility. In its rating case the high capex leads to broadly neutral free cash flow (FCF) in 2025-2026, and a cumulative TRY6 billion positive FCF in 2027-2028. The capex plan is split between distribution (77%) and generation (23%). On generation, it includes one geothermal project (Alkan) of USD52 million, targeted to be completed in 2027 (a year later than originally expected) and one solar hybrid power plant. The company has other generation licences, but these projects are not included in the capex plan and will be considered only after meeting operational and financial criteria. These are not in its rating case and could slow deleveraging if not conservatively funded. Divestments Remain Important: Zorlu completed the Dorad Power Station stake sale in 2025 for USD210 million (vs. USD150 million forecast). The collected proceeds mainly funded additional distribution capex (USD50 million), fees, and debt reduction. Another USD40 million related to the sale remains in escrow, which the company expects to collect in 2026, albeit not included in its rating case. The company plans to use these funds, together with the proceeds from its Pakistani assets to be sold in 2026, to repay debt. Fitch assumes total divestment proceeds of USD200 million across 2025-2026. Operating Environment, FX Risks: The rating reflects Turkiye's high inflation and exposure of the regulatory framework to political interference. At 30 June 2025, about 91% of Zorlu's debt was in US dollars and euros, while a large share of EBITDA was in lira. FX risk is mitigated by dollar-linked revenues, with 32% of 2024 EBITDA tied to YEKDEM (renewable energy resources support mechanism), and by CPI-linked EBITDA in regulated operations. However, mismatch persists between Turkish CPI and the lira-US dollar exchange rate trends. Revenue Visibility Supports Rating: Fitch expects Zorlu to generate about 83% of 2025 EBITDA from regulated (57%) and contracted (26%) activities, supporting earnings predictability. This share will drop to about 72% by end-2028 as YEKDEM expires for some renewables plants. A rise in merchant exposure above 25% of consolidated EBITDA would weaken the business risk profile and could lead to a revision of the group's debt capacity. Fairly Transparent Regulatory Framework: Fitch views Turkish electricity distribution regulation as moderately resilient compared with other emerging markets, but more exposed to political risk than western Europe. Zorlu operates under a regulated asset base methodology with five-year periods. The current one runs to end-2025 with a healthy real return of 12.3%. It includes 10-year investment reimbursement, efficiency incentives, and full pass-through of efficiently incurred costs. However, tariff-setting is not fully transparent in a high inflation context, with possible delays in inflation recovery and working-capital volatility. Fitch does not expect large changes in the framework. Standalone Rating Approach: The assessment of the links between Zorlu and its weaker parent, Zorlu Holding A.S., under its Parent Subsidiary Linkage Criteria remains unchanged, leading to a standalone rating construction. The existing notes include leverage and ring-fencing covenants that support its view of 'insulated' legal ring-fencing around Zorlu. Fitch also views access and control factors as 'porous', due to public listing (free float 37.4%) and its independent external funding. Peer Analysis ENERGO-PRO a.s. (BB-/Negative), a utility company headquartered in the Czech Republic with operating companies in Bulgaria, Georgia, Turkiye and Spain, has higher debt capacity than Zorlu and a stronger business risk profile. This is mainly driven by better geographical diversification (operations in three countries), slightly larger scale, and a higher share of regulated and quasi-regulated businesses, leading to the rating differential. Public Power Corporation S.A. (PPC; BB-/Stable) is the incumbent integrated utility in Greece and one of the largest in Romania. Fitch assesses its Standalone Credit Profile at 'bb-'. The one-notch rating difference with Zorlu's mainly reflects its much larger scale and generation capacity as the incumbent in Greece. This is partially offset by Zorlu's higher percentage of EBITDA from regulated and quasi-regulated businesses. Zorlu has higher debt capacity than that of its two Turkish peers, Aydem Yenilenebilir Enerji Anonim Sirketi (Aydem; B/Positive) and Limak Yenilenebilir Enerji Anonim Sirketi (Limak; BB-/Negative), due mainly to its regulated distribution business. Also, Aydem's and Limak's exposure to hydro leads to more volatile generation volumes than Zorlu's generation from geothermal. Zorlu also has a higher share of quasi-regulated EBITDA under YEKDEM than Aydem, while it is comparable with that of Limak. The rating difference with Limak reflects the latter's significantly lower leverage with a funds from operations (FFO) net leverage of 1.9x at end 2024 (although expected to increase), compared with 3.5x for Zorlu. Both issuers have weak interest coverage ratios for their ratings. Key Assumptions - CPI inflation of 28% in 2025, 21% in 2026 and 18% in 2027-2028 - Exchange rate (average) of TRY39.1/USD in 2025 increasing to TRY54.5/USD in 2028 - Wholesale price of electricity of USD68/MWh in 2025, increasing to USD70/MWh by 2028 - Electricity generation volumes 3% to 5% below management forecasts over 2026-2028 - Allowed weighted average cost of capital of 12.3% for electricity distribution in 2025-2028 - Total cash inflows from divestments of TRY8 billion in 2025-2026 - Average annual capex of TRY4.8 billion over 2025-2028 - No dividend distribution over 2025-2028, in line with management forecast Recovery Analysis The recovery analysis assumes that Zorlu would be a going concern (GC) in bankruptcy and that the company would be reorganised rather than liquidated. - Fitch assumes a 10% administrative claim. - The GC EBITDA estimate of about USD170 million reflects Fitch's view of a sustainable, post-reorganisation EBITDA level on which Fitch bases the valuation of Zorlu. - Zorlu's GC EBITDA takes into account that bondholders do not have full access to the restricted group EBITDA, especially considering that the distribution company Osmangazi Elektrik Dağıtım AŞ (ODEAS) is not a guarantor. ODEAS contributes almost 56% of group EBITDA. Bondholders only have an assignment under the loan provided by Zorlu to this operating company (about USD70 million). - A multiple of 5x is applied to the GC EBITDA to calculate a post-reorganisation enterprise value, considering the company's business profile in Turkiye. - These assumptions result in a recovery rate for the senior secured instrument in the 'RR1' range. However, this is capped at 'RR4', resulting in a rating of 'B+', due to the application of the Country-Specific Treatment of Recovery Ratings Criteria, where Turkiye is in Group D. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A slower-than-expected deleveraging, lower-than-expected proceeds from asset sales, or a reduction in profitability leading to EBITDA interest coverage below 2.0x and FFO interest coverage below 2.3x on a sustained basis - EBITDA net leverage above 4.0x and FFO net leverage above 4.7x on a sustained basis - Deterioration of the business mix with regulated and contracted activities representing less than 75% of EBITDA on a structural basis could lead to a tightening of rating sensitivities Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade The Negative Outlook means that an upgrade is unlikely, but Fitch could revise the Outlook to Stable, based on: - EBITDA interest coverage above 2.0x and FFO interest coverage above 2.3x on a sustained basis - EBITDA net leverage below 4.0x and FFO net leverage below 4.7x on a sustained basis - FFO net leverage below 3.7x and EBITDA net leverage below 3.0x, coupled with EBITDA interest coverage above 3.0x on a sustained basis, could lead to a positive rating action Liquidity and Debt Structure At end-June 2025, Zorlu had TRY2.8 billion (USD70 million) of readily available cash and TRY6 million (USD151 million) of short-term debt maturities. Fitch forecasts positive FCF after acquisitions and divestitures of TRY4.2 billion (USD150 million) in 2025 and TRY2 billion (USD49 million) in 2026. The company also expects to receive USD40 million related to the sale of the Dorad asset, which is now held in an escrow account. If received, Fitch expects the company to use these funds to repay debt. Issuer Profile Zorlu is a vertically integrated utility company involved in electricity production, distribution, and electrical retail, mainly in Turkiye. Summary of Financial Adjustments Fitch-calculated EBITDA excludes the non-cash portion of the indexation difference on receivables from service concession arrangements and other operating income and expense, except interest income from distribution activities. Net investments TRY1.9 billion is reclassified from change in working capital to capex. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Sector Forecasts Monitor data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Zorlu Enerji Elektrik Uretim A.S. LT IDR B+ Affirmed B+ senior secured LT B+ Affirmed RR4 B+ ============= U K R A I N E ============= OSCHADBANK JSC: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings ------------------------------------------------------------------ Fitch Ratings has affirmed JSC State Savings Bank of Ukraine (Oschadbank)'s Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) at 'CCC' and Long-Term Local-Currency (LTLC) IDR at 'CCC+'. The IDRs do not carry an Outlook at this rating level. The Viability Rating (VR) has been affirmed at 'ccc'. Fitch has also assigned a Short-Term LC IDR of 'C'. Key Rating Drivers Oschadbank's LTFC IDR reflects Fitch's view that a default on senior FC third-party non-government obligations remains a real possibility due to the war. The bank maintains generally adequate FC liquidity, helped by various regulatory capital and exchange controls that have been in place since the outbreak of the war to reduce the risks of deposit and capital outflows and maintain stability and confidence in the banking system. The bank's LTLC IDR is one notch above the LTFC IDR, reflecting limited regulatory constraints on LC operations. Its VR reflects the high risk to its standalone profile caused by the war and that failure remains a real possibility. Challenging Operating Environment: Operating conditions for Ukrainian banks remain challenging, as reflected in its operating environment assessment of 'ccc', due to the war. Continued international support to Ukraine, supportive policy and regulatory support measures underpin macroeconomic and financial stability and banks' resilient financial performance. Second-Largest Bank: Oschadbank is the second-largest bank in Ukraine, with a 12% share of sector net assets at end-1H25. It is fully owned by the state. High Exposure to the Sovereign: The bank's risk profile continues to reflect its large exposure to the sovereign and the Ukraine operating environment. Sovereign exposure is through investments in Ukraine government securities (end-1H25: 44% of assets), deposit certificates of the National Bank of Ukraine (NBU) (9%), placements at the NBU (5%) and loan-book exposures to state-owned enterprises (about a fifth). This renders the bank vulnerable to the sovereign's repayment capacity and liquidity position. Net loans accounted for 28% of assets and include a high, albeit decreasing, share of FC loans (end-1H25: 28% of gross loans). Gross loan growth recovered to 7.7% in 1H25 and 18% in 2024. High Asset-Quality Risks: Oschadbank's impaired loans (Stage 3 and purchased or originated credit-impaired loans) ratio decreased to 22.1% at end-1H25 from 22.6% at end-2024 due to the increase in loans but remains high. Its expectation is for the impaired loans ratio to remain high given risks to asset quality from the operating environment. Total loan loss allowance covered 77% of impaired loans at end-1H25. The high share of Stage 2 loans (end-1H25: 22.5% of gross loans) presents additional risks. Improved Profitability: The bank's operating profit/risk-weighted assets ratio increased to 11.4% in 1H25 from 9.6% in 2024 largely due to the reversals of loan loss allowances. Its expectation is for near-term operating profitability to moderate due to possible loan impairment charges but remain reasonable, supported by adequate net interest margins. A possible increase in effective taxes could dent the 2025 net profit. High Capital Encumbrance: Oschadbank's common equity Tier 1 (CET1), Tier 1 and regulatory capital adequacy ratios (all 11.4% at end-1H25) had adequate buffers over their regulatory minimums under the new capital structure. Its expectation is for capitalisation to remain supported through adequate internation capital generation. Capital encumbrance from unreserved impaired loans (including purchased or originated credit-impaired loans) was high at 32.5% of CET1 capital at end-1H25. Largely Deposit Funded: Customer deposits accounted for 97% of the bank's non-equity funding at end-1H25 and include a high share of retail deposits (59% of total deposits). The loans/deposits ratio started to rise alongside the increase in loans (end-1H25: 38.6%; end-2024: 35.7%) but remains modest and its expectation is for it to gradually increase alongside loan growth. Following the repayment of a Eurobond in March 2025, the bank's remaining FC external debt at end-1H25 consisted of a bilateral loan from an international financial institution. Its base case is that Oschadbank will continue to service its external obligations. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Fitch would downgrade the bank's IDRs in the event of a sovereign downgrade, or if the agency perceives an increased likelihood that the bank will default on, or seek a restructuring of, its senior obligations. A marked further deterioration in asset quality or a weakening of profitability that eroded the bank's loss absorption buffers would lead to a VR downgrade. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Fitch believes positive action on the IDRs is unlikely in the near term. However, the rating could be upgraded if the sovereign's LTFC IDR is upgraded above 'CCC'. An upgrade of the VR is likely to require an upgrade of the sovereign LTFC IDR above 'CCC' and a considerable improvement in the operating environment, leading to lower solvency risk. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS The Short-Term IDRs of 'C' are the only possible options mapping to IDRs in the 'CCC' category. Oschadbank's National Long-Term Rating is driven by the bank's intrinsic credit profile and is in line with other large state-owned bank peers The Government Support Rating (GSR) of 'no support' reflects its view that regulatory forbearance would be more likely than recapitalisation in case of a material capital shortfall as long as banks implement recapitalisation programmes. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES The Short-Term IDRs are sensitive to changes in the LT IDRs. Oschadbank's National Rating is sensitive to changes in the bank's' LTLC IDR and its creditworthiness relative to other Ukrainian entities rated on the National Rating scale. The GSR could be upgraded if the sovereign rating was upgraded or Fitch believed it was likely that public finances would be used to recapitalise state-owned banks, if needed. VR ADJUSTMENTS The operating environment score of 'ccc' is below the 'b' category implied score due to the following adjustment reason: sovereign rating (negative). The funding and liquidity score of 'ccc' is below the 'bb' category implied score due to the following adjustment reason: deposit structure (negative). ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- JSC State Savings Bank of Ukraine (Oschadbank) LT IDR CCC Affirmed CCC ST IDR C Affirmed C LC LT IDR CCC+ Affirmed CCC+ LC ST IDR C New Rating Natl LT AA+(ukr) Affirmed AA+(ukr) Viability ccc Affirmed ccc Government Support ns Affirmed ns SENSE BANK: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings -------------------------------------------------------------- Fitch Ratings has affirmed Joint-Stock Company Sense Bank's (Sense Bank) Long-Term (LT) Foreign-Currency (FC) Issuer Default Rating (IDR) at 'CCC' and LT Local-Currency (LC) IDR at 'CCC+'. The IDRs do not carry an Outlook at this level. The Viability Rating (VR) has been affirmed at 'ccc'. Fitch has also assigned a Short Term (ST) LC IDR of 'C'. Key Rating Drivers Sense Bank's LTFC IDR reflects its view that a default on senior FC third-party non-government obligations remains a real possibility due to the war between Ukraine and Russia. The bank maintains generally adequate FC liquidity, helped by various regulatory capital and exchange controls, which have been in place since the outbreak of the war to reduce the risks of deposit and capital outflows and maintain stability and confidence in the banking system. Sense Bank's LTLC IDR, one notch above the LTFC IDR, reflects limited regulatory constraints on LC operations. The bank's VR reflects high risks to its standalone profile caused by the war and that failure remains a real possibility. Challenging Operating Environment: Operating conditions for Ukrainian banks remain challenging, as reflected in its operating environment assessment at 'ccc', due to the war. Continued international support for Ukraine, plus the National Bank of Ukraine's (NBU) supportive policy and regulatory support measures underpin macroeconomic and financial stability and banks' resilient financial performance. Ninth-Largest Bank: Sense Bank is the ninth-largest bank in Ukraine, with a 3.7% share of sector assets at end-July 2025. The bank was fully nationalised in 2023. High Sovereign Exposure: Sense Bank's sovereign exposure is high relative to its assets and mainly comprises sovereign securities (13% of assets at end-1H25), deposit certificates at the NBU (23%), and lending to state-owned enterprises. Net loans accounted for 35% of assets at end-1H25, of which 43% were FC-denominated. Gross loans rose by 7% in 1H25, after two years of contraction, with growth constrained by the war. High Impaired Loans: Sense Bank's Stage 3 loans ratio improved to 35% at end-1H25 (end-2024: 37%) but remains high by domestic standards. Total loan-loss allowances covered a reasonable 89% of impaired loans. Stage 2 loans were 9% at end-1H25, down from 23% at end-2022. Nonetheless, asset-quality risks remain heightened, driven by a protracted war. Recovering Profitability: Operating profit rose to 5.3% of risk-weighted assets (RWA) in 2024 (2023: 2%), driven mainly by lower loan impairment charges (LICs) and a wide net interest margin (7.3%). Nonetheless, Fitch expects profitability to weaken in 2H25 as LICs and operating costs increase. High Capital Encumbrance: Sense Bank's common equity Tier 1 (CET1), Tier 1 and capital adequacy ratios, calculated under the new capital structure effective August 2024 and based on regulatory data, were all at 10.8% on 1 August 2025, above the regulatory minimum requirements. Nonetheless, capital encumbrance from unreserved impaired loans is large, at 35% of CET1 at end-1H25. Deposit-Funded: The bank is almost fully deposit-funded. Retail deposits, which are covered by the government guarantee for the duration of the war and three months thereafter, represented 42% of customer deposits at end-1H25. FC deposits were 34% of customer deposits at end-1H25 and were 42% covered by high-quality liquid FC assets. Gross loans were a moderate 59% of customer deposits, but Fitch expects this ratio to rise as loan growth outpaces deposit expansion. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Fitch would downgrade Sense Bank's IDRs on a sovereign downgrade or on an increased likelihood that the bank will default on, or seek a restructuring of, its senior obligations. A marked further deterioration in asset quality or a weakening of profitability that eroded the banks' loss absorption buffers would lead to a VR downgrade. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Positive action on the IDRs is unlikely. However, the ratings could be upgraded if the sovereign's LTFC IDR is upgraded above 'CCC'. A VR upgrade would likely require an upgrade of the sovereign LTFC IDR above 'CCC' and a considerable improvement in the operating environment, leading to lower solvency risk. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS The ST IDRs of 'C' are the only possible options mapping to the LT IDRs in the 'CCC' category. Sense Bank's National LT Rating of 'AA(ukr)' reflects its view of the bank's creditworthiness in LC relative to other Ukrainian issuers'. Sense Bank's National Rating is one notch lower than those of the large state-owned banks, reflecting its view of its weaker franchise. Sense Bank's Government Support Rating of 'no support' reflects its view that regulatory forbearance would be more likely than a recapitalisation in the event of a material capital shortfall as long as banks implement recapitalisation programmes. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES The ST IDRs are sensitive to changes in the LT IDRs. A change in Sense Bank's National LT Rating would likely arise from a weakening or strengthening in its overall credit profile relative to that of other Ukrainian entities rated on the National Rating scale. The Government Support Rating could be upgraded if the sovereign ratings are upgraded or if Fitch believes it is likely that public finances would be used to recapitalise state-owned banks. VR ADJUSTMENTS The operating environment score of 'ccc' is below the 'b' category implied score for the following adjustment reason: sovereign rating (negative). ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Joint-Stock Company Sense Bank LT IDR CCC Affirmed CCC ST IDR C Affirmed C LC LT IDR CCC+ Affirmed CCC+ LC ST IDR C New Rating Natl LT AA(ukr) Affirmed AA(ukr) Viability ccc Affirmed ccc Gov't Support ns Affirmed ns UKREXIMBANK JSC: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings ------------------------------------------------------------------- Fitch Ratings has affirmed JSC The State Export-Import Bank of Ukraine's (Ukreximbank) Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) at 'CCC' and Long-Term Local-Currency (LTLC) IDR at 'CCC+'. The IDRs do not carry an Outlook. Fitch has upgraded Ukreximbank's Viability Rating (VR) to 'ccc-', from 'f', reflecting the bank's restored viability through improved capitalisation with capital ratios that no longer breach minimum capital requirements. The upgrade also reflects its expectation of the bank's ability to sustain adequate capitalisation and reduce capital impairment risk through encumbrance from unreserved impaired loans, supported by internal capital generation. Fitch has also assigned a Short-Term Local Currency IDR of 'C'. Key Rating Drivers Ukreximbank's LTFC IDR of 'CCC' reflects its view that a default on senior FC third-party non-government obligations remains a real possibility due to the war between Ukraine and Russia. The bank maintains generally adequate FC liquidity, helped by various regulatory capital and exchange controls in place since the outbreak of the war to reduce the risks of deposit and capital outflows and maintain stability and confidence in the banking system. Ukreximbank's 'CCC+' LTLC IDR, one notch above the LTFC IDR, reflects limited regulatory constraints on LC operations. The LTFC and LTLC IDRs are above Ukreximbank's VR as the bank has sufficient liquidity. This approach is consistent with its criteria under certain circumstances when bank and sovereign ratings are very low. The VR reflects Ukreximbank's improved, but still lower, capitalisation and still weak asset quality. The VR also reflects the high risk to its standalone profile caused by the war, and that failure remains a real possibility. Improved Capitalisation: CET1 and total capital adequacy ratios were 10.5% and 13.2% on 1 September 2025, which Fitch expects to be sustained above regulatory minimum requirements, supported by adequate internal capital generation. However, capital encumbrance from unreserved impaired loans was high at 136% of CET1 capital at end-1H25, though this should fall to acceptable levels relative to CET1 capital by end-2026 as core capitalisation strengthens. Profits Support Recapitalisation: Operating profit to risk-weighted assets rose to 9.6% in 1H25 (from 6.4% in 2024), supported by a small reversal in impairment charges and solid cost control. Profitability has been the primary driver of the bank's recapitalisation in recent years. However, it remains sensitive to taxation levels, particularly if there is a sharp increase in the effective tax rate. Challenging Operating Environment: Operating conditions for Ukrainian banks remain challenging, as reflected in its operating environment assessment at 'ccc', due to the war. Continued international support for Ukraine, plus the National Bank of Ukraine's (NBU) supportive policy and regulatory support measures underpin macroeconomic and financial stability and banks' resilient financial performance. Large Sovereign Exposure: Sovereign exposure was 59% of total assets at end-1H25, mainly comprising Ukrainian government securities (24%), loans to state-owned enterprises (15%), NBU deposit certificates (14%), and current accounts at the NBU (6%). This concentration increases the bank's vulnerability to the sovereign's repayment capacity and liquidity. High Impaired Loans: Ukreximbank's impaired loans (Stage 3, including purchased or originated credit-impaired) ratio was 30% at end-1H25, highlighting continued asset-quality weaknesses. Total loan-loss allowances covered a moderate 58% of impaired loans, reflecting reliance on collateral. Largely Deposit-Funded: Deposits are Ukreximbank's main source of funding (end-1H25: 90%). Its base-case expectation is for Ukreximbank to continue servicing its external obligations. The bank's other major non-deposit FC obligations include loans from international financial institutions (8% of funding). Gross loans were a low 41% of customer deposits at end-2024, but Fitch expects this ratio to rise slowly as loan expansion outpaces deposit growth. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Fitch would downgrade Ukreximbank's IDRs on a sovereign downgrade, or an increased likelihood that the bank will default on, or seek a restructuring of, its senior obligation. The VR could be downgraded if capital buffers are eroded by asset quality deterioration or weak internal capital generation, leading to capital ratios falling below regulatory minimum requirements without clear prospects of improvement. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Fitch believes positive action on the IDRs and debt ratings is unlikely in the near term. However, the ratings could be upgraded if the sovereign's LTFC IDR is upgraded above 'CCC'. The VR could be upgraded if asset quality improves, driven by a reduction in the impaired loans ratio or higher loan loss allowance coverage of impaired loans, while maintaining adequate capital buffers. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS The Short-Term IDRs of 'C' are the only possible option mapping to Long-Term IDRs in the 'CCC' category. Ukreximbank's National Long-Term Rating of 'AA(ukr)' reflects the bank's creditworthiness in LC relative to other Ukrainian issuers'. Ukreximbank's National Rating is one notch lower than those of the large state-owned banks, reflecting its weaker capitalisation and asset quality, and despite the bank's strong domestic franchise. The bank's Government Support Rating of 'no support' reflects its view that regulatory forbearance would be more likely than recapitalisation in a material capital shortfall as long as banks implement recapitalisation programmes. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES The Short-Term IDRs are sensitive to changes in Long-Term IDRs. A change in Ukreximbank's National Long-Term Rating would likely arise from a weakening or strengthening in its overall credit profile relative to that of other Ukrainian entities rated on the National Rating scale. The Government Support Rating could be upgraded if the sovereign ratings are upgraded or if public finances are used to recapitalise state-owned banks. VR ADJUSTMENTS The operating environment score of 'ccc' is below the 'b' category implied score due to the following adjustment reason: sovereign rating (negative). ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- JSC The State Export-Import Bank of Ukraine (Ukreximbank) LT IDR CCC Affirmed CCC ST IDR C Affirmed C LC LT IDR CCC+ Affirmed CCC+ LC ST IDR C New Rating Natl LT AA(ukr) Affirmed AA(ukr) Viability ccc- Upgrade f Government Support ns Affirmed ns UKRGASBANK JSB: Fitch Affirms 'CCC/CCC+' LT Issuer Default Ratings ------------------------------------------------------------------ Fitch Ratings has affirmed JSB Ukrgasbank's Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) at 'CCC' and Long-Term Local-Currency (LTLC) IDR at 'CCC+'. The IDRs do not carry an Outlook. The Viability Rating (VR) has been affirmed at 'ccc'. Key Rating Drivers JSB Ukrgasbank's Long-Term Foreign-Currency Issuer Default Rating (IDR) reflects Fitch Ratings' view that a default on the bank's senior foreign-currency obligations remains a real possibility due to the war. Nonetheless, the bank maintains adequate foreign currency liquidity, helped by various regulatory capital and exchange controls in place since the outbreak of the war to reduce the risks of deposit and capital outflows and maintain banking stability. The bank's Long-Term Local-Currency IDR is one notch above its Long-Term Foreign-Currency IDR, reflecting limited regulatory restrictions on local-currency operations. The bank's Viability Rating (VR) reflects the high risks to its standalone profile caused by the war and that failure remains a real possibility. Challenging Operating Environment: Operating conditions for Ukrainian banks remain challenging, as reflected in its operating environment assessment of 'ccc', due to the war. Continued international support, supportive policy and regulatory support measures underpin macroeconomic and financial stability and banks' resilient financial performance. Fifth-Largest Bank: Ukrgasbank is the fifth-largest Ukrainian bank, with a 5.2% market share of net sector assets at end-July 2025. The bank is 95% state-owned. High Concentration: Ukrgasbank has big exposure to the sovereign through bonds (end-2Q25: 33% of assets) and lending to state-owned enterprises (about 15%). This concentration renders the bank vulnerable to the sovereign's repayment capacity and liquidity position. It has a high but reducing share of foreign-currency loans (end-2Q25: 35% of gross loans; end-2024: 42%) and sector exposure to higher-risk energy raw material extraction and power generation (end-2024: 29%). High Asset Quality Risks: Ukrgasbank's impaired (Stage 3) loans/gross loans ratio decreased to 20.6% by end-2Q25 (end-2024: 21.5%) due to continued loan growth (1H25: 10%). There are risks of further increases in impaired loans due to the protracted war, particularly from potential migration of the bank's high Stage 2 loans (end-2Q25: 27% of gross loans). Coverage of impaired loans has also risen (end-2Q25: 75%; end-2024: 72%). Improved Profitability: Ukrgasbank's operating profit/risk-weighted assets ratio decreased slightly, to 7.0% in 1H25 (2024: 7.4%), due to the increased cost of risk (1H25: 2.1%; 2024: 0.6%) and greater risk-weighted asset density (end-2Q25: 46%; end-2024: 40%) due to a larger share of loans. The net interest margin remained almost flat, at 7.3% (2024: 7.4%). Profitability remains sensitive to potential asset quality deterioration and margin tightening. High Capital Encumbrance: Ukrgasbank's common equity Tier 1, Tier 1 and regulatory capital adequacy ratios of 16.5% at end-2Q25 had adequate buffers over their regulatory minimums of 5.625%, 7.5% and 10%, respectively, under the new capital structure, effective August 2024. Capital encumbrance by unreserved impaired loans is high, although falling to 35% at end-2Q25 (end-2024: 37%), heightening risks to capitalisation. Largely Deposit Funded: Customer deposits accounted for 92% of Ukrgasbank's non-equity funding at end-2Q25, of which 24% were retail deposits. Non-deposit funding included funds borrowed from banks and international organisations and bank deposits. Foreign-currency repayments remain subject to considerable uncertainty, but its base-case expectation is that the bank will continue to service its external obligations. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Fitch would downgrade Ukrgasbank's IDRs in the event of a sovereign rating downgrade or if Fitch perceives an increased likelihood that the bank would default on, or seek a restructuring of, its senior obligations. A marked further deterioration in asset quality or a weakening of profitability that eroded the bank's loss absorption buffers would lead to a VR downgrade. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Positive action on the IDRs is unlikely. However, the ratings could be upgraded in the event that the sovereign's Long-Term Foreign-Currency IDR was upgraded above 'CCC'. A VR upgrade would likely require an upgrade of the sovereign Long-Term Foreign-Currency IDR above 'CCC' and a considerable improvement in the operating environment, leading to lower solvency risk. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS The Short-Term IDRs of 'C' are the only possible options mapping to IDRs in the 'CCC' category. Ukrgasbank's National Long-Term Rating is driven by the bank's intrinsic credit profile and is in line with most other large state-owned bank peers. The GSR of 'no support 'reflects its view that regulatory forbearance would be more likely than recapitalisation in case of a material capital shortfall. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES The Short-Term IDRs are sensitive to changes in the LT IDRs. Ukrgasbank's National Rating is sensitive to changes in the bank's LTLC IDR and its creditworthiness relative to other local entities rated on the National Rating scale. The GSR could be upgraded if the sovereign rating was upgraded or it was likely that public finances would be used to recapitalise state-owned banks. VR ADJUSTMENTS The operating environment score of 'ccc' is below the 'b' category implied score due to the following adjustment reason: sovereign rating (negative). ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- JSB Ukrgasbank LT IDR CCC Affirmed CCC ST IDR C Affirmed C LC LT IDR CCC+ Affirmed CCC+ LC ST IDR C Affirmed C Natl LT AA+(ukr) Affirmed AA+(ukr) Viability ccc Affirmed ccc Government Support ns Affirmed ns =========================== U N I T E D K I N G D O M =========================== ALBA 2006-2: S&P Affirms 'BB+(sf)' Rating on Class F Notes ---------------------------------------------------------- S&P Global Ratings affirmed its 'A+ (sf)' credit ratings on ALBA 2006-2 PLC's class A3a, A3b, and B notes. At the same time, S&P affirmed its 'A (sf)' ratings on the class C and D notes, 'A- (sf)' rating on the class E notes, and 'BB+ (sf)' rating on the class F notes. S&P also resolved these ratings' UCO placements. S&P said, "The affirmations reflect our full analysis of the most recent information we have received and the transaction's current structural features. The overall effect of applying our global RMBS criteria is a decrease of our expected losses due to reduced weighted-average foreclosure frequency and weighted-average loss severity (WALS) assumptions. The WAFF has decreased because of lower arrears. Additionally, our WALS assumptions decreased supported by favorable house price index trends and strengthened real estate valuation data." Credit analysis results Rating level WAFF (%) WALS (%) Credit Coverage (%) AAA 29.59 24.36 7.21 AA 23.49 17.93 4.21 A 20.27 7.93 1.61 BBB 16.41 3.80 0.62 BB 12.22 2.00 0.24 B 11.17 2.00 0.22 WAFF--Weighted-average foreclosure frequency. WALS--Weighted-average loss severity. Total arrears have increased to 15.45% as of June 2025, up from 10.5% in S&P's last review (September 2023 data). Constant payment rates have remained stable, as have losses, while both the reserve fund and liquidity facility continue to be at their target levels. S&P said, "The ratings remain capped at the counterparty level under our revised counterparty criteria. Danske Bank A/S, London Branch, continues to act as the transaction account, GIC account, and liquidity facility provider. The replacement language and the standby drawing provision do not comply with our counterparty criteria. As a result, the ratings remain capped at our 'A+' ICR on Danske Bank A/S. In May 2025, the issuer novated the currency and interest rate swap from Credit Suisse (RCR: 'AA-/A-1+') to Citibank Europe (RCR: 'A+/A-1'). The new documentation complies with our criteria, and the swap counterparty cap has been lifted. However, as the other counterparties were unaffected by this update, the ratings remain capped at the ICR on Danske Bank A/S. "We affirmed our ratings on the class A3a to B notes because our credit and cash flow results indicate their available credit enhancement remains commensurate with a 'A+ (sf)' rating. Our ratings on the class C, D, E, and F notes reflect they were able to pass cash flow stresses at higher rating levels than those assigned. However, we also considered the transaction's deteriorating performance, the high percentage of interest-only loans approaching their maturity date (13.69% within the next year), and the nonconforming nature of the portfolio." The transaction is backed primarily by a pool of non-conforming mortgage loans secured on properties in England and Wales. HALLMARK MANUFACTURING: FRP Advisory Named as Administrators ------------------------------------------------------------ Hallmark Manufacturing Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts in Manchester Court Number: CR-2025-MAN-1372, and Simon Farr and Anthony of FRP Advisory Trading Limited were appointed as administrators on Oct. 13, 2025. Hallmark Manufacturing engaged in manufacturing. Its registered office is at Galveston Grove, Oldfield Business Park, Fenton, Stoke-On-Trent, ST4 3PE to be changed to C/o FRP Advisory Trading Limited, 4th Floor, Abbey House, 32 Booth Street, Manchester, M2 4AB Its principal trading address is at Galveston Grove, Oldfield Business Park, Fenton, Stoke-On-Trent, ST4 3PE The joint administrators can be reached at: Simon Farr Anthony Collier FRP Advisory Trading Limited 4th Floor, Abbey House 32 Booth Street Manchester, M2 4AB For further details, contact: The Joint Administrators Tel: 0161 833 3344 Alternative contact: Beth Megram Email: Beth.megram@frpadvisory.com HIGHWAYS 2021: S&P Affirms 'BB+(sf)' Rating on Class E Notes ------------------------------------------------------------ S&P Global Ratings raised its credit ratings on Highways 2021 PLC's class B, C, and D notes to 'AA+ (sf)', 'AA- (sf), and 'A- (sf)', respectively. S&P also affirmed its 'AAA (sf)' rating on the class A notes and 'BB+ (sf)' rating on the class E notes. At the same time, S&P removed the ratings from UCO. Rating rationale S&P said, "The rating actions follow the publication of our revised global CMBS criteria. As part of our review, we considered the transaction's five key rating factors (the securitized assets' credit quality, legal and regulatory risks, operational and administrative risks, counterparty risks, and payment structure and cash flow mechanisms). "The transaction's credit quality is stable, but our S&P Global Ratings value is 5.3% higher than at our previous review in 2023 due to the removal of purchase costs under our new criteria. Our upgrades of the class B, C, and D notes are primarily due to this higher S&P value along with the recovery rate adjustments under our new criteria." Transaction overview The single loan is secured on eight MSAs, of which seven are located in England and one in Scotland. The total rentable area for the properties is 41,563 square meters. The MSAs are leased to Welcome Break Group Ltd. or Welcome Break Ltd., the second largest MSA operator in the U.K. Each MSA generally offers a café or restaurant, a retail outlet, a hotel, and a petrol station. Welcome Break has strategic partnerships with well-established brands, such as Starbucks, Subway, Burger King, and Tossed. Part of their operations derives from hotels, with most being franchises of Days Inn or Ramada. As of June 2025, the properties' reported market value was GBP450.90 million, 1.4% higher than the reported market valuation in December 2022 of GBP444.70 million. The reported loan-to-value (LTV) ratio decreased to 58.77% from 59.50%. A cash trap event occurs if the LTV ratio reaches 64.31%. Since closing, this cash trap event has not been triggered. Market vacancy for this property type is extremely low. No MSAs have closed since opening in the 1950s and despite some planning application approvals, properties are yet to be built. The property portfolio's weighted-average unexpired lease term until first break has marginally decreased to 20.6 years from 23.8 years since closing. Over the same period, gross rental income has increased to GBP21.60 million from GBP19.67 million, directly resulting from the annual 'step up' until Dec. 31, 2026. The rent will then be reviewed from Jan. 1, 2027, annually based on the increase in the consumer price index plus 1% subject to a minimum annual increase collar of 2% and a maximum annual increase cap of 3%. If the tenant opts to renew the lease on Jan. 1, 2046, the rent will be reviewed on a five-yearly basis, based on upward-only open market rent. The interest-only loan was originally due to mature in December 2023. The loan has three one-year loan extension options subject to the satisfaction of certain conditions. The extension options were exercised in December 2023, December 2024, and December 2025. S&P expects the loan maturity date to be extended to December 2026. S&P said, "To calculate the S&P net cash flow (NCF), we maintained the approach we adopted at closing as the property portfolio is unchanged. At closing, we underwrote to the 2026 aggregate rent of GBP23.45 million. The rent payments are fixed on an annual 'step up' basis until Dec. 31, 2026. We still consider this rent level to be sustainable over the long term, because apart from the COVID-19 pandemic years, the portfolio has generated sufficient EBITDAR to cover the stepped-up rent. We also applied a capitalization rate of 6.0% (the same as at closing) against the S&P NCF to arrive at our S&P Value of GBP352.68 million." Table 1 Loan and collateral summary Review April 2023 October 2025 Data as of February 2023 June 2025 Senior loan balance (mil. GBP) 264.5 264.5 LTV ratio (%) 59.5 based on 58.7 based on market value market value Gross rental income (mil. GBP) 20.16 21.57 Vacancy rate by area (% ) 0.00 0.00 Market value (mil. GBP 444.70 450.90 (Dec 2022) (Dec 2024) LTV--Loan-to-value. Table 2 Key assumptions Review April 2023 October 2025 S&P Global Ratings vacancy (%) 5.00 5.00 S&P Global Ratings expenses (%) 5.00 5.00 S&P Global Ratings net cash flow (mil. GBP) 21.16 21.16 S&P Global Ratings value (mil. GBP)* 335.05 352.68 S&P Global Ratings cap rate (%) 6.00 6.00 Haircut-to-market value (%) 28.18 21.80 S&P loan-to-value ratio (before recovery rate adjustments; %) 78.94 75.00 *The 2025 figure no longer includes purchasers' costs of 5%. Other analytical considerations S&P said, "We also assessed whether the cash flow from the securitized assets would be sufficient, at the applicable ratings, to make timely payments of interest and ultimate repayment of principal by the floating-rate notes' legal final maturity date, after considering available credit enhancement and allowing for transaction expenses and external liquidity support. "Our analysis also includes a full review of the legal and regulatory risks, operational and administrative risks, and counterparty risks. Our assessment of these risks remains unchanged since closing and is commensurate with the ratings." Rating actions S&P said, "Our ratings in this transaction address the timely payment of interest, payable quarterly, and the payment of principal no later than the legal final maturity date in December 2031. In our view, the transaction's credit quality has remained stable since closing. "The S&P Global Ratings LTV ratio is 75.0%, down from 78.9% at closing due to the slight change in our value. After considering recovery rate adjustments, we affirmed our ratings on the class A and E notes and raised our ratings on the class B, C, and D notes. Our rating on the class E notes could be higher. However, because this class does not benefit from liquidity reserve support, we do not consider its credit risk to be commensurate with an investment-grade rating." HOPS HILL NO. 4: S&P Affirms 'BB(sf)' Rating on Cl. E-Dfrd Notes ---------------------------------------------------------------- S&P Global Ratings affirmed its 'AAA (sf)' credit rating on Hops Hill No. 4 PLC's class A notes, 'AA (sf)' rating on the class B-Dfrd notes, 'A (sf)' rating on the class C-Dfrd notes, 'BBB (sf)' rating on the class D-Dfrd notes, and 'BB (sf)' rating on the class E-Dfrd notes. S&P also resolved the UCO placements. S&P said, "The rating actions follow our full review of the transaction to resolve the UCO placements following the publication of our revised counterparty criteria on July 25, 2025. They also reflect our full analysis of the most recent information we have received and the current structural features. The overall effect of applying our global RMBS criteria is a decrease of our expected losses due to reduced weighted-average foreclosure frequency and weighted-average loss severity (WALS) assumptions. The WAFF has decreased primarily due to the removal of the prefunding adjustment, as the prefunding period has now expired. Additionally, our WALS assumptions decreased due to increasing house prices." Credit analysis results Rating level WAFF (%) WALS (%) Credit Coverage (%) AAA 22.98 40.75 9.36 AA 15.53 33.99 5.28 A 11.80 22.73 2.68 BBB 8.06 16.25 1.31 BB 4.33 11.80 0.51 B 3.40 8.05 0.27 WAFF--Weighted-average foreclosure frequency. WALS--Weighted-average loss severity. S&P said, "We affirmed our 'AAA (sf)' rating on the class A notes because our credit and cash flow results without a commingling stress indicate the available credit enhancement remains commensurate with this rating. "We also affirmed our 'AA (sf)', 'A (sf)', 'BBB (sf)' and 'BB (sf)' ratings on the class B-Dfrd, C-Dfrd, D-Dfrd, and E-Dfrd notes. These tranches were able to pass cash flow stresses at higher rating levels than those assigned but our affirmations also reflect the limited credit enhancement built-up since closing, the upcoming reversion rates (67.6% of the portfolio is due to revert from a fixed to floating rate over the next three years), the sensitivity to higher prepayment scenarios, and that the transaction closed only a year ago. "Counterparty risk does not constrain the ratings as we consider the transaction to be in line with our counterparty criteria." Hops Hill No.4 PLC closed in May 2024, and is backed primarily by a pool of first lien buy-to-let mortgage loans secured on properties in England and Wales. HUMAN MAGIC: S&W Partners Named as Administrators ------------------------------------------------- Human Magic Ltd was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-006788, and Ben Woodthorpe and Simon Jagger of S&W Partners LLP were appointed as administrators on Oct. 13, 2025. Human Magic engaged in business support services. Its registered office and principal trading address is at Queens Insurance Building, 24 Queen Avenue, Dale Street, Liverpool, L2 4TZ. The joint administrators can be reached at: Ben Woodthorpe Simon Jagger S&W Partners LLP 22 York Buildings London, WC2N 6JU Alternative contact: Liam Evans Administrators Email: liam.evans@swgroup.com MOLOSSUS BTL 2024-1: Fitch Hikes Rating on Class X Notes to 'BB-sf' ------------------------------------------------------------------- Fitch Ratings has upgraded Molossus BTL 2024-1 PLC's (Molo 2024-1) class B, C, D, E and X notes, while affirming the rest. Fitch has removed all ratings from Under Criteria Observation. Entity/Debt Rating Prior ----------- ------ ----- Molossus BTL 2024-1 PLC Class A XS2793365268 LT AAAsf Affirmed AAAsf Class B XS2793366662 LT AAAsf Upgrade AAsf Class C XS2793366746 LT A+sf Upgrade Asf Class D XS2793366829 LT Asf Upgrade BBB+sf Class E XS2793367041 LT BBB+sf Upgrade BB+sf Class F XS2793367124 LT BBsf Affirmed BBsf Class X XS2793367637 LT BB-sf Upgrade B+sf Transaction Summary Molo 2024-1 is a securitisation of buy-to-let (BTL) mortgages originated in England and Wales by ColCap Financial UK Limited. ColCap is a wholly owned subsidiary of ColCap Financial Limited, an Australian non-bank mortgage lender. KEY RATING DRIVERS UK RMBS Rating Criteria Updated: The rating actions reflect its updated UK RMBS Rating Criteria (see "Fitch Ratings Updates UK RMBS Rating Criteria", dated 23 May 2025). Key changes include updated representative pool weighted average foreclosure frequencies (WAFF), changes to sector selection, revised recovery rate assumptions and changes to cashflow assumptions. Fitch now applies dynamic default distributions and high prepayment rate assumptions, rather than static assumptions. The updated criteria resulted in a decrease in the 'AAAsf' expected loss by 3pp. Strong Asset Performance: Arrears greater than one month totalled 0.2% as at June 2025 and there have been no repossessions nor losses in the pool since closing in May 2024, although the weighted average (WA) seasoning of the pool is only 39 months. The transaction's performance has been better than the Fitch UK BTL index average, reflecting the high quality of the collateral pool, despite the limited history of origination and performance data available at closing. The strong asset performance, combined with the updated UK RMBS Rating Criteria, supports the upgrades. Alternative Prepayment Rates: The deal includes a large portion of fixed-rate loans subject to early repayment charges. The scheduling of the loans' reversion from a fixed rate to the relevant follow-on rate will likely determine when prepayments occur. About 80% of fixed-rate loans will revert over the next 24 months; therefore, Fitch has applied an alternative high prepayment stress that tracks the fixed-rate reversion profile of the pool, with prepayments capped at a maximum 40% a year. Fitch has also not given credit to the turbo mechanism that diverts excess spread to pay down the notes in its analysis due to the possibility of higher prepayments further compressing excess spread. Rating Cap on Mezzanine Notes: Fitch considers payment interruption risk to be mitigated up to 'A+sf' as the liquidity reserve only cover senior fees and class A and B interest. Interest on the class C to F notes cannot be deferred without causing an event of default when the notes become the most senior class. The collection account bank is an operational continuity bank and transfers funds daily from receipt, and the servicer provides a declaration of trust on the collection account bank for the benefit of the issuer. Longer Recovery Lag: Fitch tested the notes' sensitivity to a delay to recoveries for an additional 12 months beyond the UK RMBS Rating Criteria expectations, to account for a potential delay in ColCap's ability to work out UK loan defaults, given its recent entry into the UK market through its offshore team. Most of the ratings were resilient to the stress except the class D notes, which are therefore rated one notch below their model-implied rating. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The transactions' performance may be affected by changes in market conditions and economic environment. Weakening of the latter is highly correlated to increasing levels of delinquencies and defaults that could reduce the credit enhancement available to the notes. Unanticipated declines in recoveries could also result in lower net proceeds, which may make certain notes susceptible to negative rating action, depending on the decline in recoveries. Fitch found that a 15% increase in the WAFF and 15% decrease in the weighted average recovery rates would imply the following: Class A: 'AAAsf' Class B: 'AA+sf' Class C: 'A+sf' Class D: 'BBB+sf' Class E: 'BBB-sf' Class F: 'B+sf' Class X: 'Bsf' Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Stable to improved asset performance driven by stable delinquencies and defaults would lead to increasing credit enhancement and, potentially, upgrades. Fitch found that a decrease in the WAFF of 15% and an increase in the weighted average recovery rates of 15% would lead to the following: Class A: 'AAAsf' Class B: 'AAAsf' Class C: 'A+sf' Class D: 'A+sf' Class E: 'A+sf' Class F: 'BBBsf' Class X: 'BB+sf' USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. Prior to the transaction closing, Fitch reviewed the results of a third-party assessment conducted on the asset portfolio information and concluded that there were no findings that affected the rating analysis. Prior to the transaction closing, Fitch conducted a review of a small, targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. OAKTREE POWER: Begbies Traynor Named as Administrators ------------------------------------------------------ Oaktree Power Group Limited was placed into administration proceedings in the High Court of JusticeBusiness and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-007096, and Bai Cham and Gary Paul Shankland of Begbies Traynor (Central) LLP were appointed as administrators on Oct. 13, 2025. Oaktree Power Group engaged in activities of other holding companies. Its registered office is c/o Begbies Traynor, Innovation Centre Medway, Maidstone Road, Chatham, Kent, ME5 9FD The joint administrators can be reached at: Bai Cham Begbies Traynor (Central) LLP Innovation Centre Medway Maidstone Road, Chatham Kent, ME5 9FD -- and – Gary Paul Shankland Begbies Traynor (London) LLP 31st Floor, 40 Bank Street London, E14 5NR For further details, contact: Jamie Mayhew Begbies Traynor (Central) LLP Email: Jamie.Mayhew@btguk.com Tel No: 01634 975440 PEAK JERSEY: S&P Lowers LongTerm ICR to 'CCC' on Refinancing Risk ----------------------------------------------------------------- S&P Global Ratings lowered its long-term issuer credit rating on Peak Jersey Holdco Ltd., the holding company of Stats Perform, as well as the issue ratings on its GBP50 million revolving credit facility (RCF) and $500 million senior secured term loan, to 'CCC' from 'CCC+'. S&P said, "The CreditWatch developing reflects our expectation that we could either lower our rating if Stats Perform does not refinance its upcoming maturities in a timely manner or raise the rating if the group successfully refinances its capital structure depending on the terms of the refinancing." Peak Jersey Holdco Ltd., the holding company of Stats Perform, faces a material refinancing risk within the next 12 months, with the largest maturity coming in July 2026. Stats Perform's trading performance in the first half of 2025 improved compared with the same period in 2024, although its leverage remains high and free operating cash flow (FOCF) negative due to the high interest burden. The 'CCC' rating on Peak Jersey reflects increased likelihood of payment default, in the absence of a successful refinancing. As of June 30, 2025, the group has availability under the Vista credit line (equity line provided by the majority shareholder) of $32.5 million out of the $75 million, which, coupled with existing cash on a balance sheet of $26 million should suffice to fulfill the very near-term liquidity requirements. S&P said, "We note that $10 million of the $50 million total RCF is due in Feb 2026 and the remaining in April 2026, while the largest part of the debt, the $500 million TLB, is due in July 2026. However, in our opinion, in the absence of a successful refinancing process, there is increased likelihood that the group may need to consider alternative transactions. As of now, there is no tangible evidence that this will occur. According to our criteria, transactions such as refinancing below par, conventional non-payment, or a debt exchange, among others, are viewed as tantamount to default." The group's recent performance supports growing top line and EBITDA in 2025-2026. Stats Perform reported revenue growth of 6% in the first half of 2025 compared with the same period in 2024, with its management-defined EBITDA margin at about 18%. This growth was primarily driven by the expansion of betting streaming services, strong commercial execution of new video rights investments, the expansion of territorial licenses, and price increases. S&P anticipates the group will continue benefitting from newly secured contracts and the rollout of new AI-enhanced products resulting in revenue of $490million-$500 million expected in 2025 and management-defined EBITDA of $85million-$95 million (which translates into S&P Global Ratings-adjusted EBITDA of $60million-$70million after deducting capitalized development costs and exceptional costs). S&P said, "Our rating on Stats Perform is also constrained by elevated leverage and limited free operating cash flow (FOCF). We forecast the group will report S&P Global Ratings-adjusted leverage about 11x in 2025, alongside negative FOCF of about $45 million primarily due to elevated interest costs. Our debt calculation includes: about $65million equivalent drawn RCF; the $500 million TLB, the $140 second-lien TLB due in July 2027, and about $10 million in lease liabilities. Our leverage calculation does not include cash on the balance sheet due to the private equity ownership. "The CreditWatch developing reflects the fact that we could lower the rating if the company does not refinance its upcoming maturities in a timely manner. We could also lower the rating if the company agreed to a transaction that we viewed as tantamount to default, including a conventional default, a liquidity crisis, debt restructuring, or a distressed exchange. "Conversely, we could raise the rating if Peak Jersey refinances its upcoming maturities. Rating upside will be subject to the company's capital structure, liquidity headroom, and operating performance paving a way to structurally positive FOCF after leases." POLARIS 2025-3: Fitch Assigns 'B-(EXP)sf' Rating on Class X2 Debt ----------------------------------------------------------------- Fitch Ratings has assigned Polaris 2025-3 Plc (Polaris 25-3) expected ratings. The assignment of final ratings is contingent on the receipt of final transaction documentation conforming to information already reviewed by Fitch. Entity/Debt Rating ----------- ------ Polaris 2025-3 Plc A XS3216526205 LT AAA(EXP)sf Expected Rating B XS3216526387 LT AA+(EXP)sf Expected Rating C XS3216526460 LT A(EXP)sf Expected Rating D XS3216526544 LT BBB+(EXP)sf Expected Rating E XS3216526890 LT BBB-(EXP)sf Expected Rating F XS3216526973 LT B(EXP)sf Expected Rating G XS3216527195 LT B(EXP)sf Expected Rating X1 XS3216527278 LT B(EXP)sf Expected Rating X2 XS3216527351 LT B-(EXP)sf Expected Rating Transaction Summary Polaris 25-3 is a securitisation of owner-occupied (OO) and buy-to-let (BTL) mortgages originated by UK Mortgage Lending Ltd, which is wholly owned by Pepper Money Limited. The loans are secured on properties located in the UK. The transaction includes primarily 2025 originations, with a small portion originated in the prior years. This is the 11th transaction in the Polaris series. KEY RATING DRIVERS Specialist Assets: The mortgage pool will comprise a mix of recently originated assets and some more seasoned OO loans. There is a small portion of BTL loans included (3.9%), Pepper has only recently resumed BTL lending. Pepper has a manual approach to underwriting, which is typical for specialist lenders, focusing on borrowers who do not qualify on high street lenders' automated scorecard criteria. Transaction Adjustment: Arrears performance data is weaker than at high street prime lenders' as would be expected, due to the complex target market of the originator. The mortgage pool will be 20% composed of loans where the borrower has a County Court Judgement (CCJ), of which about 12.5% have a CCJ balance of greater than GBP1,000. About 58% of the pool will be from Pepper's strongest products - '36' or '48' - representing the number of months since the last CCJ/default, but the rest of the pool will consist of products with more recent borrower CCJ/default. Shared ownership mortgages will account for 7.5% of the pool. Fitch has applied a transaction adjustment of 1.25x to the foreclosure frequency (FF) to reflect the product mix and historical performance. In line with that for other specialist lenders, Fitch has increased the FF for self-employed borrowers to the OO sub-pool with verified income to 30%, instead of the 20% increase typically applied under its UK RMBS Rating Criteria. Product Switches Drive Excess Spread: The assets in the portfolio earn higher interest rates than typical prime mortgage loans. The current weighted average (WA) interest rate is 6.2% but the level of excess spread is reduced by the ability of the transaction to retain product switches. Up to 25% of the original balance of the loans (including prefunded loans) can be retained after the product switch. The minimum interest rate of product switches is at a level that produces a post-swap margin of 2%. The point at which these loans are scheduled to revert from a fixed rate to the relevant follow-on rate will likely determine when prepayments will occur. Fitch has therefore applied an alternative high prepayment stress that tracks the fixed rate reversion profile (inclusive of retained product switches) of the pool. The prepayment rate applied is floored at the high prepayment rate assumptions produced by Fitch's analytical model ResiGlobal (UK) and capped at a maximum 40% a year. Fixed Interest Rate Swap Schedule: The transaction will feature a fixed-to-floating interest rate swap to hedge the interest rate risk between the fixed-rate mortgage assets and the SONIA-linked notes. The swap will have a defined notional schedule, which incorporates some prepayments that increase over time. In Fitch's cash flow modelling, the combination of high prepayments and decreasing interest rates leads to the transaction being over-hedged with swap payments senior to note interest. Prefunding: There will be an initial over-issuance of about a quarter of the notes. These additional funds can be used to purchase additional assets until the first interest payment date. Fitch believes the conditions around the permitted pool of prefunded loans mitigates the risk of a material deterioration in the credit quality of the pool of assets. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The transaction's performance may be affected by changes in market conditions and the economic environment. Weakening economic performance is strongly correlated to increasing levels of delinquencies and defaults that could reduce the credit enhancement available to the notes. In addition, unexpected declines in recoveries could result in lower net proceeds, which may make certain notes susceptible to negative rating action, depending on the extent of the decline in recoveries. Fitch found that a 15% increase in weighted average (WA) FF and a 15% decrease in WA recovery rate (RR) would result in downgrades of no more than one notch each for the class A, D, F and X2 notes, three notches for the class B notes and two notches each for the class C, D and G notes. There is no impact on the class X1 notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Stable to improved asset performance driven by stable delinquencies and defaults would lead to increasing credit enhancement and, potentially, upgrades. Fitch found that a 15% decrease in the WAFF and a 15% increase in the WARR would lead to upgrades of four notches each for the class C, E, F, G and X1 notes, and three notches for the class D notes. There is no impact on the class X2 and B notes. The class A notes are already rated at the maximum rating of 'AAAsf'. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Fitch was provided with Form ABS Due Diligence-15E as prepared by Deloitte LLP. The third-party due diligence described in Form 15E focused on verification of loan data. Fitch considered this information in its analysis and it did not have an effect on Fitch's analysis or conclusions. DATA ADEQUACY Fitch reviewed the results of a third-party assessment conducted on the asset portfolio information and concluded that there were no findings that affected the rating analysis. Fitch conducted a review of a small, targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. POLARIS 2025-3: S&P Assigns Prelim. CCC Rating on Cl. X2 Notes -------------------------------------------------------------- S&P Global Ratings assigned preliminary credit ratings to Polaris 2025-3 PLC's class A, B-Dfrd, C-Dfrd, D-Dfrd, E-Dfrd, F-Dfrd, G-Dfrd, X1-Dfrd, and X2-Dfrd notes. At closing, the issuer will also issue unrated RC1 and RC2 residual certificates. The originator, UK Mortgage Lending Ltd., began lending in 2015 and operates as a specialist buy-to-let and owner-occupied mortgage lender. This is the 11th Polaris transaction that we have rated. The historical performance of the lender's mortgage book has proven relatively strong to date, with total arrears consistently below 6.0% for owner-occupied mortgages. Total arrears have trended below S&P's U.K. nonconforming index for post-2014 originations The servicer, Pepper (UK) Ltd., is an established and leading U.K. servicer. S&P believes its team is experienced, and it has already serviced several transactions that it has rated. Since Pepper (UK) also provides third-party servicing, it has well-established and fully integrated servicing systems and policies. The capital structure's application of principal proceeds is fully sequential. Credit enhancement can therefore accumulate for the rated notes, enabling the capital structure to withstand performance shocks. The pool has a low current indexed loan-to-value (LTV) ratio of 66.4%, which is less likely to incur loss severities if the borrower defaults. The liquidity reserve fund will be unfunded at closing and is expected to accumulate using available principal receipts until it reaches the higher of 1% of the class A or B-Dfrd notes' closing balances. As a result, the class A notes will remain exposed to liquidity risk until the reserve is fully funded. S&P said, "We considered this in our cash flow analysis, and we noted the liquidity coverage available to each class in our rating considerations. In our stressed cash flow modelling, the liquidity reserve fund is fully funded shortly after closing." The transaction includes a prefunded amount of up to 24.3%, where the issuer can purchase loans until the first IPD. The addition of these loans could adversely affect the pool's credit quality. Portfolio limitations mitigate this risk. Product switches are permitted, subject to certain conditions being met. S&P performed additional sensitivities that capture the risk of margin deterioration, and the assigned ratings reflect the results of these sensitivities. Of the loans in the pool, 7.52% relates to shared ownership mortgages, and this exposure is lower than in Polaris 2025-2 PLC (7.73%). S&P considered this risk in its analysis. S&P said, "We stress the transaction's cash flows to test the credit and liquidity support that the assets, subordinated tranches, and reserves provide. Our preliminary ratings address timely payment of interest and ultimate payment of principal on the class A notes, and they reflect ultimate payment of interest and principal on all other rated notes. Our standard cash flow analysis indicates that the available credit enhancement for the class D-Dfrd to G-Dfrd notes is commensurate with higher ratings than those currently assigned." However, the ratings on these notes also reflect the results of sensitivities related to higher defaults, product switches, and prefunding, as well as sensitivity to reduced excess spread caused by prepayments. The transaction embeds some strengths that may offset deteriorating collateral performance. Given its sequential amortization, credit enhancement is expected to accumulate. The existence of a liquidity fund may, to a certain extent, protect the notes against credit losses and liquidity stresses. In addition, the interest rate swap mitigates the effect on note coupon payments from rising daily compounded SONIA rates that they are linked to. S&P said, "The class F-Dfrd and X1-Dfrd notes did not pass any of the rating scenario stresses in our driving cash flow run which incorporate higher prepayments, but they pass our steady state scenarios. However, because our rating on these notes addresses ultimate payment of principal and interest, we believe default is not likely, as the notes can continue to defer interest until maturity. In line with our 'CCC' ratings criteria, the class F-Dfrd and X1-Dfrd notes are not dependent on favorable economic conditions to repay their obligations at maturity. We therefore assigned our 'B- (sf)' rating to these notes. "The class G-Dfrd and X2-Dfrd notes did not pass any of the rating scenario stresses in our driving cash flow run which incorporate higher prepayments, or our steady state scenarios. However, because our ratings on these notes addresses ultimate payment of principal and interest, we believe default is not likely, as the notes can continue to defer interest until maturity. In line with our 'CCC' ratings criteria, the class G-Dfrd and X2-Dfrd notes are dependent on favorable economic conditions to repay their obligations at maturity. We therefore assigned our 'CCC (sf)' ratings to these notes. "The issuer is an English special-purpose entity, which we expect to be bankruptcy remote, subject to our review of the relevant transaction documents and a legal opinion. "The issuer is exposed to HSBC Bank as the transaction account provider, Barclays Bank PLC as the collection account provider, and HSBC Bank as swap counterparty. We have not reviewed swap documentation incorporating our counterparty criteria. For this analysis, we assume the documented replacement mechanisms at closing will be consistent with our counterparty criteria." Preliminary ratings Class Prelim. Rating Prelim. class size (%) A AAA (sf) 87.75 B-Dfrd* AA (sf) 5.50 C-Dfrd* A- (sf) 3.25 D-Dfrd* BBB- (sf) 1.75 E-Dfrd* BB+ (sf) 0.75 F-Dfrd* B- (sf) 0.80 G-Dfrd CCC (sf) 0.20 X1-Dfrd B- (sf) 2.25 X2-Dfrd CCC (sf) 1.50 RC1 Residual Certificates NR N/A RC2 Residual Certificates NR N/A *S&P's preliminary rating on this class considers the potential deferral of interest payments. NR--Not rated. N/A--Not applicable. RILEY PERSONNEL: Quantuma Advisory Named as Administrators ---------------------------------------------------------- Riley Personnel Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-006679, and Michael Kiely (IP No. 9617) and Sean Bucknall (IP No. 18030) both of Quantuma Advisory Limited were appointed as administrators on Oct. 8, 2025. Riley Personnel is a temporary employment agency. Its registered office is at Riverside House, Riverside, Bishop's Stortford, CM23 3AJ and it is in the process of being changed to c/o Quantuma Advisory Limited, 7th Floor, 20 St Andrew Street, London, EC4A 3AG Its principal trading address is at Riverside House, Riverside, Bishop's Stortford, CM23 3AJ The joint administrators can be reached at: Michael Kiely Sean Bucknall Quantuma Advisory Limited 7th Floor, 20 St. Andrew Street London, EC4A 3AG For further details, please contact: Tom Miller Tel No: 020 3856 6720 Email: tom.miller@quantuma.com SALUS EUROPEAN LOAN 33: S&P Affirms 'B(sf)' Rating on D Notes ------------------------------------------------------------- S&P Global Ratings affirmed its 'A+ (sf)', 'BBB- (sf)', 'B+ (sf)', and 'B (sf)' credit ratings on Salus (European Loan Conduit No. 33) DAC's class A, B, C, and D notes, respectively. At the same time, S&P removed the ratings from under criteria observation. Rating rationale S&P said, "The affirmations follow the publication of our global CMBS criteria. The transaction's credit and cash flow characteristics are relatively stable since closing in November 2018. Our S&P Global Ratings value is 2.5% higher than at our previous review in May 2025, partly due to the removal of purchase costs." Transaction overview The transaction closed in November 2018 and is a U.K. CMBS transaction secured by a single senior loan originated by Morgan Stanley Bank N.A. (Morgan Stanley) backed by CityPoint, an office tower in Central London. The loan had an initial term of three years with two one-year extension options available, subject to the satisfaction of certain conditions. All loan extension options available under the senior loan agreement were exercised and the loan was scheduled to mature in January 2024. A 12-month extension to the senior loan maturity date to Jan. 20, 2025, was granted, with amendments to the senior loan, to allow the borrower to recapitalize the property by way of sale or refinancing on or before the extended maturity date. The borrower did not secure a sale or refinancing of the loan at the end of the 12-month period. The senior loan maturity was further extended to April 20, 2025, subject to certain conditions, to allow the borrower to continue trying to refinance the loan on or before the extended maturity date. A noteholders meeting was held on April 16, 2025, and the consent solicitation was agreed. The loan has now been extended for a further three years with loan maturity in January 2028 and is hedged by a cap with a strike rate of 4.5%. The legal final maturity date of the notes was also extended to January 2032 from January 2029 which means that the tail period would remain at four-years. The senior loan securing this transaction totals GBP363.3 million, split into a GBP350.0 million term loan facility and a GBP13.3 million capital expenditures facility. There is also GBP91.9 million in mezzanine debt and a committed new money loan of GBP21.5 million which are fully subordinated to the senior loan. An additional uncommitted new money loan can be advanced, but this is subject to certain conditions if it is required during the course of the loan term. As of the July 2025 interest payment date, the property's vacancy (by area) had decreased to 7.7% from 11.7%, as an existing tenant had taken more space. S&P said, "However, we recognize that the vacancy rate may increase in 2028 and 2030, as the largest occupiers, Squarepoint Capital and Simmons & Simmons, both intend to exercise their respective break clauses in the years immediately following the loan's maturity date in 2028. Any potential purchaser is likely to consider the loss of rental income from Squarepoint Capital and Simmons & Simmons when assessing the purchase price for the property. Nevertheless, we believe the space vacated by Squarepoint and Simmons & Simmons will be attractive to new tenants after the current occupiers' departure in 2030, as the sponsor is investing in property improvements to achieve higher energy performance certificates (EPCs). Our analysis incorporates a vacancy rate that accounts for any lease rollover for the property." At the same time, the total contractual rent increased to GBP37.3 million from GBP34.3 million at S&P's previous review. Approximately GBP12.2 million in rent-free incentives will expire incrementally by May 2027, and 4.2% of the total contractual rent is due for renewal by the end of 2025. The weighted-average lease term until the break is 5.93 years, down from 6.1 years at our previous review. The tenant profile is predominantly composed of legal and professional firms, with the two largest law firms tenants contributing 46% of the total contractual rent. The top five tenants contribute 79% of the total rental income, while retail and leisure tenants, including restaurants, coffee shops, bars, and a gym, contribute 3.0%. S&P said, "We have assumed 20% vacancy in line with our previous review, based on the current and historical property vacancy and lease rollover. The London City submarket vacancy has improved to approximately 8.8%, while the current vacancy for the property is 7.7% (previously 11.7% at our previous review) and has ranged between 12% and 20% during the past two years. Although the property's vacancy rate has begun to improve, Squarepoint Capital and Simmons & Simmons plan to vacate the property in 2028 and 2030, respectively, when they both exercise their break clauses. "We have considered this when calculating our S&P Global Ratings vacancy assumption and lease break assumptions. Our non-recoverable expenses assumption has remained stable at 10.6%. As a result, our S&P Global Ratings net cash flow (NCF) has marginally decreased to GBP27.4 million from GBP27.6 million. "We then applied a 6.5% capitalization rate to our S&P Global Ratings NCF, the same as at our previous review. We also deducted approximately GBP12.4 million for rent-free periods as of March 2025 to derive our S&P Global Ratings value. This represents a 38.9% haircut to the March 2023 market value of GBP670 million. We believe this market value is not a true reflection of the price a purchaser would be willing to pay under current market conditions. "We made overall a 4.50% negative adjustment to our recovery rates which reflects subordinate debt and a quality score of 3.0, income stability score of 3.0, and an additional adjustment for sector and asset concentration." Other analytical considerations S&P said, "Our analysis also included a full review of the legal and regulatory risks, operational and administrative risks, and counterparty risks. Our assessment of these risks remains unchanged since our previous review and is commensurate with the ratings assigned." Rating actions S&P's ratings in this transaction address the timely payment of interest, payable quarterly, and the payment of principal no later than the legal final maturity date in 2032. S&P said, "Our opinion of the long-term sustainable value is slightly higher than at closing, reflecting a change in our criteria, with our S&P Value now net of purchase costs. As a result, we no longer deduct 5% from the gross value. Therefore, our S&P Global Ratings LTV ratio is 88.7%, down from 91.0% at our previous review. "For all classes of notes, we affirmed our outstanding ratings despite higher model-indicated ratings, because we further qualitatively considered the following (amongst other factors) which, generally moderated our rating actions: collateral property performance (both historical and expected) and the significant exposure to a single office property. We therefore affirmed our 'A+ (sf)', 'BBB- (sf)', 'B+ (sf)', and 'B (sf)' ratings on the class A, B, C, and D notes, respectively." SOUTH COAST WATCH: Moorfields Named as Administrators ----------------------------------------------------- South Coast Watch Fair Limited was placed into administration proceedings in the High court of Justice, Business and Property Courts, Insolvency & Companies List (ChD), Court Number: CR-2025-007137, and Milan Vuceljic and Michael Solomons of Moorfields were appointed as administrators on Oct. 14, 2025. South Coast Watch specialized in letting and operating of own or leased real estate. Its registered office and principal trading address is at 2nd Floor, Unicorn House, Station Close, Potters Bar, EN6 1TL The joint administrators can be reached at: Milan Vuceljic Michael Solomons Moorfields 82 St John Street London EC1M 4JN Tel No: 020 7186 1144 For further details, contact: Lachlan Bowness Moorfields Tel No: 020 7186 1148 Email: lachlan.bowness@moorfieldscr.com 82 St John Street, London, EC1M 4JN TRAVELPORT TECHNOLOGY: S&P Assigns 'CCC+' ICR, Outlook Stable ------------------------------------------------------------- S&P Global Ratings assigned a 'CCC+' long-term issuer credit rating on travel retail platform provider Travelport Technology Ltd., to reflect its position as the topmost entity in the Travelport structure and the entity where the audited accounts are completed. S&P therefore withdrew its 'CCC+' long-term issuer credit rating on Toro Private Holdings I Ltd. S&P affirmed its 'CCC+' long-term issuer credit rating on Travelport Finance (Luxembourg) S.a.r.l. and its 'CCC+' issue level rating on the group's senior secured notes. The stable outlook reflects S&P's expectation of a material EBITDA improvement over the next two years. It also reflects the company's sizable cash balance and no debt maturity until 2028. Travelport Technology Ltd. is the topmost entity in the group structure and the entity where the audited accounts are completed. Hence, S&P withdrew its issuer credit rating on Toro Private Holdings I Ltd. S&P said, "Results for the first six months of the year were weaker than we previously expected, which, alongside ongoing extremely high interest costs, led to a material cash outflow during the period. We have revised down our revenue growth expectations to between negative 2% and 3% (from positive 3% previously) for full-year 2025 (ended Dec. 31, 2025), due to headwinds in North America and India that resulted in lower booking fee volumes. We expect competition with direct bookings from airlines to persist, which will add pressure to Travelport's top line. However, we understand that a significant portion of the lost revenue was lower margin business, and we forecast that S&P Global Ratings-adjusted EBITDA will still improve year-on-year (from about $145 million in 2024). Cost savings resulting from headcount reduction, lower outsourced labor costs, and lower development costs at Travelport+, should support EBITDA generation going forward. We forecast improved, but still very high, S&P Global Ratings-adjusted debt to EBITDA of over 15x in 2025 (about 12x excluding convertible preferred equity [CPE]) and over 13x in 2026 (about 10x excluding CPE), following about 18x in 2024 (about 14x excluding CPE). We expense capitalized development costs, customer loyalty costs, and corporate and restructuring costs in our calculation of adjusted EBITDA. We continue to view the group's CPE as debt under our criteria but acknowledge its cash preserving nature. "The stable outlook reflects our expectation of a material EBITDA improvement over the next two years. It also reflects the company's sizable cash balance as well as no debt maturity until 2028. "We could lower our rating on Travelport if we believed there was an increased risk of default in the next 12 months. This could occur, for example, if the expected EBITDA recovery fails to take hold, leading to significantly negative free operating cash flow (FOCF) and a sharp deterioration in liquidity. We could also downgrade the company if it announced a debt exchange offer or debt restructuring or missed any interest payment. "We could raise our rating if a sustained solid recovery in operating performance leads to adjusted debt to EBITDA of below 10x. We would also expect to see sustainably positive FOCF after lease payments and EBITDA cash interest coverage of about 1.5x. In our view, this points to a sustainable capital structure over the long term." VELO BICI: KRE Corporate Named as Administrators ------------------------------------------------ Velo Bici Ltd was placed into administration proceedings in the High Court of Justice Court Number: CR-2025-006988, and David Taylor and Paul Ellison of KRE Corporate Recovery Limited were appointed as administrators on Oct. 8, 2025. Velo Bici engaged in online retails. Its registered office is c/o KRE Corporate Recovery Limited, Unit 8, The Aquarium, 1-7 King Street, Reading, RG1 2AN Its principal trading address is at Payton House Packwood Court, Guild Street, Stratford-Upon-Avon, Warwickshire, CV37 6RP The joint administrators can be reached at: David Taylor Paul Ellison KRE Corporate Recovery Limited Unit 8, The Aquarium 1-7 King Street, Reading Berkshire, RG1 2AN For further details, contact: Alison Young Email: alison.young@krecr.co.uk Tel: 01189 479090 ********* 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 2025. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. * * * End of Transmission * * *