/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/080924.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Wednesday, September 24, 2008, Vol. 9, No. 190 Headlines A U S T R I A AIRTOOL & CO: Claims Registration Period Ends October 20 EDELWISER LLC: Claims Registration Period Ends October 15 EDUARD HILDEBRAND: Claims Registration Period Ends October 14 B U L G A R I A FIRST INVESTMENT: Fitch Affirms Individual Rating at 'D' G E R M A N Y ARTKOMM GMBH: Claims Registration Period Ends October 2 CONCEPT BERATUNGS: Claims Registration Period Ends September 30 E & R PUTZ: Claims Registration Period Ends September 30 FORCE TWO: Fitch Puts EUR9.7MM Notes 'BB' Rating Under Neg. Watch FRACTALIS GMBH: Claims Registration Period Ends September 30 HANSE WARMETECHNIK: Claims Registration Period Ends Oct. 1 HYDRO - MASCHINENHANDEL: Claims Registration Ends September 30 KAUFHAUS WOHA: Claims Registration Period Ends September 30 LIDER DOENERPRODUKTION: Claims Registration Period Ends Oct. 1 * GERMANY: Market Crisis Has Little Effect on Real Economy I R E L A N D STOCKERYALE INC: Gets Continued Listing of Stocks Until Dec. 23 I T A L Y ALITALIA SPA: Fate Depends on Results of Another Sale Attempt TELECOM ITALIA: Cuts 5,000 Jobs as Part of Restructuring Plan * ITALY: Pension Funds Not Directly Affected by Lehman Brothers K A Z A K H S T A N AGRO LAND-BWK: Creditors Must File Claims by November 11 AGRO TECH: Claims Deadline Slated for November 11 AMISTAD LLP: Claims Filing Period Ends November 7 JMO ORAL: Creditors' Claims Due on November 11 K Y R G Y Z S T A N HONG TAI: Creditors Must File Claims by November 3 R O M A N I A BANCPOST S.A: Fitch Affirms Individual Rating at 'D' BANCA ROMANEASCA: Fitch Holds 'D' Individual Rating R U S S I A KAMA-LES LLC: Creditors Must File Claims by October 11 NATIONAL RESERVE: Moody's Assigns E+ Financial Strength Rating PIK GROUP: Fitch Puts Low-B IDRs Under Negative Watch RENAISSANCE CAPITAL: S&P Assigns BB- Counterparty Credit Rating ROS-MET LLC: Creditors Must File Claims by October 11 ROSEVROBANK: Fitch Assigns 'D' Individual Rating RUSSIAN FACTORING: Fitch Holds 'BB' Rating on RUB300BB Facility SIB-LES LLC: Creditors Must File Claims by November 11 SVIAZ-BANK: Moody's Cuts Bank Financial Strength Rating to E TIMBER CENTER: Creditors Must File Claims by November 11 VYATKO-KOMPLEKT: Kirov Bankruptcy Hearing Set November 30 * S&P Revises Outlook to Stable on Seven Low-B Rated Russian Banks * S&P Says Russian Govt. Financial Support Outcomes Unpredictable * UDMURTIA REPUBLIC: Moody's Assigns Ba1 Currency Issuer Ratings S P A I N HABITAT: Calls EGM to Decide on Future; Facing Dissolution S W I T Z E R L A N D CARGO CARE: Proofs of Claim Filing Deadline is October 5 CBD CREATIVE: Creditors' Proofs of Claim Due by October 5 CREA CDO I: October 5 Set as Deadline to File Proofs of Claim DAVIT JSC: Creditors Must File Proofs of Claim by October 5 LAIMBACHER UNTERNEHMENSBERATUNG: Claims Due by October 15 PERSIST JSC: Creditors Have Until October 4 to File Claims SPORTHOTEL SHERLOCK: Deadline to File Claims Set October 5 U K R A I N E AZOVSTAL IRON: S&P Lifts Corporate Credit Rating to B+ BAKHMACHBREAD LLC: Creditors Must File Claims by September 27 BELTAN LLC: Creditors Must File Claims by September 28 DNIEPROVSKIYE ZORI: Creditors Must File Claims by September 28 FORLAND LLC: Creditors Must File Claims by September 26 MANDARIN 2004: Creditors Must File Claims by September 26 MBD-LOGISTICS LTD: Creditors Must File Claims by September 26 NOSOVKA REGIONAL: Creditors Must File Claims by September 28 U N I T E D K I N G D O M AMERICAN INTERNATIONAL: Loses US$5.36 Billion in Second Quarter BRADFORD & BINGLEY: U.K. Regulator Working on Firm's Takeover CHASE MIDLAND: Owes Creditors More Than GBP22 Million FERGUS HAYNES: Goes Into Receivership; Owes EUR15 Million LEHMAN BROTHERS: Nomura Reaches Deal to Buy Eur & Mid-East Biz LEHMAN BROTHERS: PwC Wants US$8 Billion Returned to European Arm M.I.W. FABRICATIONS: Claims Filing Period Ends November 3 M.I.W. METALWORK: Claims Filing Period Ends November 3 INEOS VINYLS: Moody's Assigns Negative Outlook to Low-B Ratings PERSONAL STORAGE: Taps PricewaterhouseCoopers as Liquidators ROADCHEF FINANCE: S&P Lowers Rating on Class A2/B Notes to BB/B SMARTIRE SYSTEMS: Patent Infringement Suit vs. Schrader Settled TERRAPIN TECHNICAL: Claims Filing Period Ends October 16 * BRITAIN: FTSE 100 Index Soars 6% on U.S. Talks of Rescue Plan * BRITAIN: Finance Workforce to Shrink by 2% by 2009, Poll Says * EUROPE: Banks and Insurers See US$7.3B Losses Tied to Lehman * EUROPE: Spreads on Credit Default Swaps Hit Stressed Levels * UK Retail Sales Volume Rise 1.2% in August, ONS Survey Says * Fitch Says Default in Loans Securing European CMBS is Mounting * Fitch Puts 18 Tranches in Six European CMBS Under Negative Watch ********* ============= A U S T R I A ============= AIRTOOL & CO: Claims Registration Period Ends October 20 -------------------------------------------------------- Creditors owed money by LLC Airtool & Co. KG have until Oct. 20, 2008, to file written proofs of claim to the court-appointed estate administrator: Mag. Gregor Royer Ringstrasse 13 4600 Wels Austria Tel: 07242/58120 Fax: 07242/58120-22 E-mail: office@eigner-royer.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:00 a.m. on Oct. 30, 2008, for the examination of claims at: The Land Court of Wels Hall 101 Wels Austria Headquartered in Lambach, Austria, the Debtor declared bankruptcy on Aug. 25, 2008, (Bankr. Case No. 20 S 101/08s). EDELWISER LLC: Claims Registration Period Ends October 15 --------------------------------------------------------- Creditors owed money by LLC Edelwiser have until Oct. 15, 2008, to file written proofs of claim to the court-appointed estate administrator: Dr. Karl Schirl Krugerstrasse 17/3 1010 Vienna Austria Tel: 513 22 31 Fax: DW 1 E-Mail: dr.karl.schirl@der-rechtsanwalt Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:50 a.m. on Oct. 29, 2008, for the examination of claims at: The Trade Court of Vienna Room 1707 Vienna Russia Headquartered in Vienna, Austria, the Debtor declared bankruptcy on Aug. 22, 2008, (Bankr. Case No. 2 S 105/08s). EDUARD HILDEBRAND: Claims Registration Period Ends October 14 ------------------------------------------------------------- Creditors owed money by LLC Eduard Hildebrand have until Oct. 14, 2008, to file written proofs of claim to the court-appointed estate administrator: Mag. Johanna Abel-Winkler Franz Josefs-Kai 49/19 1010 Vienna Austria Tel: 533 52 72 Fax: 533 52 72 15 E-mail: office@abel-abel.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 9:00 a.m. on Oct. 28, 2008, for the examination of claims at: The Trade Court of Vienna Room 1606 Vienna Austria Headquartered in Vienna, Austria, the Debtor declared bankruptcy on Aug. 26, 2008, (Bankr. Case No. 4 S 120/08m). =============== B U L G A R I A =============== FIRST INVESTMENT: Fitch Affirms Individual Rating at 'D' -------------------------------------------------------- Fitch Ratings has changed Bulgaria-based First Investment Bank's Outlook to Negative from Stable. Its other ratings are affirmed at Long-term Issuer Default 'BB-', Short-term IDR 'B', Individual 'D', Support '5' and Support Rating Floor 'No Floor'. The Outlook change reflects the challenges that FIBank is facing in the current market environment in terms of attracting new long- term funding and capital at an acceptable cost and refinancing its existing obligations in full. As a result, FIBank's prospects in terms of both profitability and market share could well be negatively impacted. "In the event that FIBank is unable to refinance its existing obligations in full, consisting primarily of a EUR185 million one- year syndicated loan with a one-year put/call option maturing in October 2008, and/or attract new funding and capital on suitable terms, the bank will be unable, or at the very least severely limited, in its ability to grow its balance sheet", says Lindsey Liddell, Director in Fitch's Financial Institutions Department, "This, in turn, will dampen FIBank's profitability and therefore also its internal capital generation, and will likely lead to an erosion of its market shares." Fitch comments that the bank's market shares and performance ratios have already shown some signs of weakening in H108. These trends follow a EUR200 million Eurobond repayment in January 2008, combined with market conditions that have deterred FIBank from tapping the capital markets for the new long-term funding and capital it needs to grow its balance sheet. As a result, the bank has been forced to curb loan growth (just 1% in H108 from 62% in 2007) in order to maintain sufficient liquidity. FIBank's liquidity is adequate but should be viewed in light of the bank's upcoming financing needs and contractually short-term customer deposit base. The need to hold sufficient liquidity has become even more acute following the small run on customer deposits experienced by the bank in May 2008, which, although fairly swiftly reversed, saw customer deposits fall by 5.6% overall in H108. However, the customer deposit base has risen since end-June 2008 and is above its end-2007 levels, although Fitch notes that the bank is pricing at the higher end of the market. FIBank's ratings reflect the bank's good franchise, diversified customer deposit base, acceptable risk management framework and solid fee income. Additionally, asset quality ratios remain acceptable and market risk is limited. However, the ratings also consider the bank's still-high borrower concentration. Downward rating pressure would result from FIBank's inability to refinance obligations and grow its balance sheet and the negative impact this would have on its performance indicators and market shares. Ratings upside is limited in the medium term. Founded in 1993, FIBank was the sixth-largest bank in Bulgaria by total assets at end-H108. It had market shares of 6.2% and 6.9% of banking sector assets and deposits, respectively. It is the largest remaining Bulgarian-owned bank. Ultimate control of the bank is in the hands of its two founding shareholders, individuals with significant interests in tourism and real estate. FIBank is partially listed on the Sofia Stock Exchange. It has a small subsidiary bank in Albania. ============= G E R M A N Y ============= ARTKOMM GMBH: Claims Registration Period Ends October 2 ------------------------------------------------------- Creditors of Artkomm GmbH fuer Kommunikation, Kultur und Medien have until Oct. 2, 2008, to register their claims with court- appointed insolvency manager Peter Jost. Creditors and other interested parties are encouraged to attend the meeting at 8:40 a.m. on Nov. 4, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Frankfurt (Main) Hall 2 Building F Klingerstrasse 20 60313 Frankfurt (Main) Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Peter Jost Pfingstweidstrasse 3, D 60316 Frankfurt (Main) Germany Tel: 069/209739-0 Fax: 069/20973929 The District Court of Frankfurt (Main) opened bankruptcy proceedings against Artkomm GmbH fuer Kommunikation, Kultur und Medien on July 31, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Artkomm GmbH fuer Kommunikation, Kultur und Medien Niddastrasse 52 60329 Frankfurt (Main) Germany CONCEPT BERATUNGS: Claims Registration Period Ends September 30 --------------------------------------------------------------- Creditors of ConCepT Beratungs- und Vermittlungsgesellschaft mbH have until Sept. 30, 2008, to register their claims with court- appointed insolvency manager Dirk Decker. Creditors and other interested parties are encouraged to attend the meeting at 11:00 a.m. on Nov. 11, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Reinbek Parkallee 6 21465 Reinbek Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Dirk Decker Julius-Vosseler-Str. 42 22527 Hamburg Germany The District Court of Reinbek opened bankruptcy proceedings against ConCepT Beratungs- und Vermittlungsgesellschaft mbH on Aug. 8, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: ConCepT Beratungs- und Vermittlungsgesellschaft mbH Attn: Wilhelm Stueermann, Manager Humboldtstr. 25 21509 Glinde Germany E & R PUTZ: Claims Registration Period Ends September 30 -------------------------------------------------------- Creditors of E & R Putz und Farbe GmbH Stukkateur- und Malerbetrieb have until Sept. 30, 2008, to register their claims with court-appointed insolvency manager Dr. Reinhard Th. Schmid. Creditors and other interested parties are encouraged to attend the meeting at 9:00 a.m. on Nov. 4, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Stuttgart Room 178 Hauffstr. 5 70190 Stuttgart Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Dr. Reinhard Th. Schmid Hasenbergsteige 5 70178 Stuttgart Germany Tel: 0711/66 90 70 Fax: 0711/66 45 068 The District Court of Stuttgart opened bankruptcy proceedings against E & R Putz und Farbe GmbH Stukkateur- und Malerbetrieb on Sept. 1, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: E & R Putz und Farbe GmbH Stukkateur- und Malerbetrieb Attn: Erol Yilmaz, Manager Siemensstr. 2/1 71404 Korb Germany FORCE TWO: Fitch Puts EUR9.7MM Notes 'BB' Rating Under Neg. Watch ----------------------------------------------------------------- Fitch Ratings has placed FORCE TWO Limited Partnership's notes due January 2018 on Rating Watch Negative, as: -- EUR148,821,724.63 Class A notes (ISIN: XS0299041037): 'AAA' on RWN -- EUR12,300,000 Class B notes (ISIN: XS0299041896): 'AA' on RWN -- EUR13,000,000 Class C notes (ISIN: XS0299042357): 'A' on RWN -- EUR11,900,000 Class D notes (ISIN: XS0299044056): 'BBB' on RWN -- EUR9,700,000 Class E notes (ISIN: XS0299045020): 'BB' on RWN Fitch released two new criteria on 30 April 2008: Global Criteria for Corporate CDO/CLOs and Global Criteria for Cash Flow Analysis in Corporate CDOs. At that time, Fitch noted that it would be reviewing its ratings with these two new criteria to establish consistency for existing and new transactions, and the rating actions are a result of this review. This transaction is a cash securitization of two types of subordinated loan agreements, where one type features loss participation and interest deferral mechanisms, advanced to German medium-sized enterprises. As of the review in September 2008, based on the latest portfolio information available, the pool has slightly deteriorated. Currently the portfolio contains 47 obligors (initially 48 obligors). The largest exposure accounts for 5.9% of the portfolio amount and the top three obligors for 15.8% of the portfolio. Since closing in May 2007, there has been one default. For two portfolio companies the repayment amount has been reduced due to the loss participation mechanism. The current repayment amounts would be increased to the initial notional amounts if the companies start generating profits again. Two of the remaining assets comprising 3.8% of the portfolio are under special care process, and a further 12 companies comprising 25.5% of the portfolio are closely tracked by portfolio manager, EquiNotes Management GmbH, as highlighted in the investor report of July 2008. As of this report no companies have exercised the option of deferring scheduled interest payments. The current amount of the principal deficiency ledger equals EUR1.6 million. If no further principal deficiency events occur, Fitch expects that this amount would be repaid to Class A noteholders over the following two interest payment dates. The securitized debt instruments comprising the portfolio are deeply subordinated. As a result, Fitch assumes no recovery in its analysis. In addition to default simulations using its Portfolio Credit Model, Fitch has performed cash-flow analysis to stress possible interest rate and default timing patterns. The transaction benefits from high levels of excess spread and a principal deficiency mechanism for excess spread trapping. Classes A, B, C, and D are most sensitive to front-loaded default timing, whereas Class E notes are most sensitive to back-loaded default timing. Based on the analysis, the credit enhancement derived from both subordination and excess spread is not sufficient to justify the current ratings of the notes. The Negative Watch status is attributable to the CDO methodology change, to the observed persistent underperformance in the European mezzanine CLO sector, and to deterioration in the FORCE TWO Limited Partnership portfolio. Similarly to peer mezzanine CLOs, credit events occurred at a relatively early stage of this transaction. Additionally, Fitch is reviewing its default assumptions for SME CDOs, especially where highly concentrated portfolios are securitized. Given the limited number of obligors in this transaction, previously applied portfolio approaches to assessing the underlying credit quality may not sufficiently reflect the risk of the individual borrowers. Therefore, guidance provided regarding the potential downgrade actions is broad. There is increased uncertainty with regards to Class A notes as the outcome is particularly sensitive to Fitch's final obligor default assumptions: -- Class A notes: May not remain investment grade -- Class B notes: Likely to be downgraded to the non-investment grade range -- Class C notes: Likely to be downgraded to the low non- investment grade range -- Class D notes: Likely to be downgraded to the low non- investment grade range -- Class E notes: Likely to be downgraded to the low non- investment grade range The resolution of the Negative Watch status will incorporate any changes made to the portfolio or the transaction along with additional portfolio migration. It will also depend on the updated financial data of the underlying obligors, which is outstanding for 30% of the portfolio. FRACTALIS GMBH: Claims Registration Period Ends September 30 ------------------------------------------------------------ Creditors of fractalis gmbh Interaktive Medientechnologien have until Sept. 30, 2008, to register their claims with court- appointed insolvency manager Peter Depre. Creditors and other interested parties are encouraged to attend the meeting at 10:00 a.ma. on Oct. 11, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Karlsruhe Hall IV First Floor Schlossplatz 23 76131 Karlsruhe Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Peter Depre O 4, 13-16 68161 Mannheim Germany Tel: (06 21) 12 07 80 The District Court of Karlsruhe opened bankruptcy proceedings against fractalis gmbh Interaktive Medientechnologien on Aug. 12, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: fractalis gmbh Interaktive Medientechnologien Attn: Matthias Buehner, Manager Scheffelstr. 53 76135 Karlsruhe Germany HANSE WARMETECHNIK: Claims Registration Period Ends Oct. 1 ---------------------------------------------------------- Creditors of Hanse Warmetechnik GmbH have until Oct. 1, 2008, to register their claims with court-appointed insolvency manager Soenke Hansen. Creditors and other interested parties are encouraged to attend the meeting at 10:05 a.m. on Oct. 22, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Hamburg Meeting Hall B405 Fourth Floor Sievkingplatz 1 20355 Hamburg Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Soenke Hansen Moenckebergstrasse 17 20095 Hamburg Germany The District Court of Hamburg opened bankruptcy proceedings against Hanse Warmetechnik GmbH on Aug. 1, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Hanse Warmetechnik GmbH Attn: Peter Schmorr, Manager Tarpen 15 22419 Hamburg Germany HYDRO - MASCHINENHANDEL: Claims Registration Ends September 30 -------------------------------------------------------------- Creditors of HYDRO - Maschinenhandel GmbH & Co. KG have until Sept. 30, 2008, to register their claims with court-appointed insolvency manager Michael Pluta. Creditors and other interested parties are encouraged to attend the meeting at 9:30 a.m. on Oct. 14, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Ravensburg Hall 209 Herrenstr. 42 88212 Ravensburg Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Michael Pluta Karlstr. 33 89073 Ulm Germany The District Court of Ravensburg opened bankruptcy proceedings against HYDRO - Maschinenhandel GmbH & Co. KG on Aug. 1, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: HYDRO - Maschinenhandel GmbH & Co. KG Attn: Josef Kugler, Liquidator Im Grund 7 88356 Ostrach Germany KAUFHAUS WOHA: Claims Registration Period Ends September 30 ----------------------------------------------------------- Creditors of Kaufhaus WOHA Kissling und Marquardt GmbH have until Sept. 30, 2008, to register their claims with court-appointed insolvency manager Werner Schneider. Creditors and other interested parties are encouraged to attend the meeting at 10:00 a.m. on Nov. 10, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Aalen Hall 0.11 Ground Floor Stuttgarter Strasse 7, 73430 Aalen Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Werner Schneider Bahnhofstr. 41 89231 Neu-Ulm Germany Tel: 0731/97018-0 Fax: 0731/97018-65 E-mail: werner.schneider@schneidergeiwitz.de Web site: www.schneidergeiwitz.de The District Court of Aalen opened bankruptcy proceedings against Kaufhaus WOHA Kissling und Marquardt GmbH on Aug. 15, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Kaufhaus WOHA Kissling und Marquardt GmbH Attn: Juergen Marquardt, Manager Marktplatz 6 73525 Schwabisch Gmuend Germany LIDER DOENERPRODUKTION: Claims Registration Period Ends Oct. 1 -------------------------------------------------------------- Creditors of Lider Doenerproduktion GmbH have until Oct. 1, 2008, to register their claims with court-appointed insolvency manager Dr. Juergen Spliedt. Creditors and other interested parties are encouraged to attend the meeting at 9:30 a.m. on Oct. 29, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Potsdam Hall 24 Jagerallee 10-12 14469 Potsdam Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Dr. Juergen Spliedt Uhlandstrasse 165/166 10719 Berlin Germany The District Court of Potsdam opened bankruptcy proceedings against Lider Doenerproduktion GmbH on Aug. 1, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Lider Doenerproduktion GmbH Gewerbehof Gueterfelde/ Priesterweg Bereich 1 14532 Stahnsdorf Germany Attn: Arslan Yusuf, Manager Dueppetstrasse 37 12163 Berlin Germany * GERMANY: Market Crisis Has Little Effect on Real Economy ---------------------------------------------------------- Amid the German Finance Ministry's statement that the market crisis has little effect on the real economy in Germany, the crisis has increased the downside risks to the country's economic outlook, according to reports. The Ministry, early last week said that the crisis is mainly a United States issue. Finance Ministry spokesman Torsten Albig said that while some German financial institutions had been hit by the U.S. subprime crisis, "in their totality, [they] are recognizably not as involved as U.S. and other Anglo-Saxon institutions," Monsters & Critics reports. German Finance Minister Peer Steinbrueck had made it clear that although the country is "in the middle of a crisis, . . . it is centrally an American crisis, Monster & Critics relates. However, the Ministry admitted that the acceleration of global inflation due to rising prices for raw materials and food is dampening global growth, Reuters notes. The Ministry remained positive saying that Germany, being competitive and having good finances, would be less affected by the crisis as compared with other countries, Reuters relates. The Ministry said that "[t]he reversal of the excesses on the markets for raw materials and a substantially weaker euro are [rays] of hope, Reuters adds. ============= I R E L A N D ============= STOCKERYALE INC: Gets Continued Listing of Stocks Until Dec. 23 --------------------------------------------------------------- StockerYale Inc. received an extension from the Nasdaq Listing Qualifications Panel to regain compliance with the US$1.00 minimum bid price requirement of The Nasdaq Stock Market until Dec. 23, 2008. In order for the company to maintain its listing on the Nasdaq Stock Market beyond that date, its common stock must have a closing bid price of US$1.00 or more for a minimum of ten consecutive trading days prior to Dec. 23, 2008. The company disclosed that on Dec. 28, 2007, the company received a notice from The Nasdaq Stock Market indicating that it was not in compliance with Nasdaq Marketplace Rule 4450(a)(5) because, for 30 consecutive business days, the bid price of the company's common stock had closed below the minimum US$1.00 per share. The company did not regain compliance with the minimum bid price requirement and, accordingly, on June 26, 2008, the company received written notification from The Nasdaq Stock Market stating that the company's common stock would be subject to delisting as a result of the deficiency unless the company requested a hearing before the Panel. On July 3, 2008, the company requested a hearing before the Panel to address the minimum bid price deficiency, which was held on Aug. 14, 2008. At the hearing, the company presented a plan to regain compliance with the minimum bid price requirement. The extension granted by the Panel is subject to the company's continuing compliance with all requirements for continued listing on the Nasdaq Capital Market. There can be no assurance that the company will maintain compliance with the continued listing requirements of The Nasdaq Stock Market or achieve the minimum bid price of US$1.00 for a minimum of ten consecutive trading days. About StockerYale Inc. Headquartered in Salem, New Hampshire, StockerYale Inc. (NASDAQ: STKR) -- http://www.stockeryale.com-- is an independent designer and manufacturer of structured light lasers, LED modules, and specialty optical fibers for industry leading OEMs. In addition, the company manufactures fluorescent lighting products and phase masks. The company serves markets including the machine vision, industrial inspection, defense, telecommunication, sensors, and medical markets. StockerYale has offices and subsidiaries in the U.S., Canada, and Ireland. ========= I T A L Y ========= ALITALIA SPA: Fate Depends on Results of Another Sale Attempt ------------------------------------------------------------- After a rescue plan failed last week, Alitalia SpA proceeded with its fourth public request for offers to buy any or all parts of the company's assets until Sept. 30, 2008, newspapers say. The carrier has already prepared notices to be published in the Italian newspapers Corriere della Sera, il Sole-24 Ore and la Repubblica, as well as the London-based Financial Times, according to The Associated Press. In the prepared notice cited by The AP, Alitalia is seeking "whoever might be able to guarantee the continuity, in the medium term, of the transportation service ... to submit its expression of interest." As reported in the Troubled Company Reporter-Europe on Sept. 22, 2008, Compagnia Aerea Italiana s.r.l., a newly formed investor group backed by Italian Prime Minister Silvio Berlusconi, withdrew its bid to buy Alitalia's healthier assets after failing to win the support of labor unions, various reports say. A TCR-Europe report on Sept. 10, 2008, said Alitalia's unions rejected the employment contract proposed by CAI. CAI proposed among others that pilots' vacation be reduced from 42 to 30 days a year, with extra day off for every five years of service in the company; and attendants' fixed salary be reduced by 43% while their variable salary will be reduced by 28%-31%. Unions described the proposal as "worst, unfeasible, and not viable," following a meeting with the Italian government, Alitalia and CAI. Only three of the carrier's nine unions accepted the terms of CAI's rescue plan. Bloomberg News reported that on September 14, the airline's four biggest unions won an agreement from CAI to include 1,000 more workers in the rescue plan. However, on September 18, CGIL, one of the four largest unions, joined the remaining five unions in pushing for more concessions, says the report. Without an alternative in place, CAI's bid withdrawal would push Alitalia into total collapse. The Wall Street Journal says the airline is now running on just EUR30 million (US$42.5 million) to EUR50 million in cash, and loses between EUR1 million and EUR2 million every day. Alitalia Special Administrator Augusto Fantozzi has said the airline will use part of its remaining cash to fund this month's payroll which is due Sept. 27, 2008. Meanwhile, some analysts told Bloomberg News that Alitalia, which is already under government bankruptcy protection, had no choice but to liquidate. "The most likely scenario is that the government will break up the company and cancel contracts," Diogenis Papiomytis, a transport analyst at Frost & Sullivan in London, was cited by Bloomberg News as saying. "That will have huge social costs and will probably set off industrial action." Moves to save the state-controlled airline became clear after the Italian government amended its bankruptcy law to hasten the sale of its 49.9% stake in Alitalia and it turn around, a TCR-Europe report on Sept. 1, 2008, said. Under Intesa Sanpaolo S.p.A.'s "Phoenix" rescue plan, Italy government amended the Marzano Law, which was used to reorganize Parmalat. The government tapped Intesa Sanpaolo as adviser for the sale of its 49.9% stake in Alitalia. The amended law allowed Alitalia to be split into two -- an oldco and a newco. The oldco will shoulder the cost of the planned 5,000-7,000 job cuts and take on Alitalia's EUR1.1 billion debt -- including the recent EUR300 million loan from the government and a EUR750 million convertible bond. The government will place the oldco under extraordinary administration and appoint an extraordinary commissioner to oversee the sale of unprofitable assets. The law also allowed Alitalia's extraordinary commissioner to sell its assets through private talks and without holding public auction. The newco, meanwhile, will inherit Alitalia's fleet and real estate assets as well as the remaining employees and up to EUR500 million in debt. It would receive around EUR300 million in assets from AirOne S.p.A., which would be folded under the newco. AirOne leads a group of 16 local investors who pledged to inject around EUR1 billion into the newco in exchange for shares. About Alitalia Based in Rome, Alitalia S.p.A. -- http://www.alitalia.it/-- provides air travel services for passengers and air transport of cargo on national, international and inter-continental routes, including United States, Canada, Japan and Argentina. The Italian government owns 49.9% of Alitalia. Despite a EUR1.4 billion state-backed restructuring in 1997, Alitalia posted net losses of EUR256 million and EUR907 million in 2000 and 2001 respectively. Alitalia posted EUR93 million in net profits in 2002 after a EUR1.4 billion capital injection. The carrier booked annual net losses of EUR520 million in 2003, EUR813 million in 2004, EUR168 million in 2005, EUR625.6 million in 2006, and EUR494.64 million in 2007. Alitalia S.p.A. declared insolvency on Aug. 29, 2008, and filed for commencement of extraordinary administration procedure at the Tribunal of Rome. Italian Prime Minister Silvio Berlusconi has appointed Augusto Fantozzi as extraordinary commissioner. TELECOM ITALIA: Cuts 5,000 Jobs as Part of Restructuring Plan ------------------------------------------------------------- Telecom Italia SpA has agreed with unions to remove 5,000 out of its 83,000 employees as part of a restructuring plan. Dow Jones Newswires relates Telecom Italia in June unveiled a cost-cutting plan aimed at reducing annual costs by roughly EUR300 million. Italian newspapers cited by Reuters have reported that the company is also looking to sell its assets. Stiffening competition and regulatory pressures are pushing the company to boost its balance sheet including securing a new investor, possibly from the Gulf, as well as on splitting off its fixed-line unit, a source close to the issue told Reuters News. According to Reuters, the source's comments followed Italian newspaper reports that the phone company was looking for fresh capital amid falling profits and under EUR37 billion (US$52.53 billion) in long-term debt. Reuters' source noted however that nothing definitive on these issues was expected from a board meeting tomorrow, September 25. Based in Milan, Italy, Telecom Italia S.p.A. -- http://www.telecomitalia.it/-- (NYSE:TI) is a telecommunications group that operates in the communications sector, in the television sector using both analog and digital terrestrial technology, and in the office products sector. The company is engaged principally in the communications sector and, particularly, in telephone and data services on fixed lines, for final retail customers and wholesale providers, in the development of fiber optic networks for wholesale customers, in Internet services, in domestic and international mobile telecommunications (especially in Brazil), in the television sector using both analog and digital terrestrial technology and in the office products sector. The company operates mainly in Europe, the Mediterranean Basin and in South America. In August 2008, ILIAD SA announced that it had finalized the acquisition of Alice France, the broadband operations of the company. * ITALY: Pension Funds Not Directly Affected by Lehman Brothers --------------------------------------------------------------- Italy's pension funds regulator, Covip, assured the public that the bankruptcy of Lehman Brothers Holdings Inc. has negligible direct effect to the pension funds, various reports say. Covip's Chairman Luigi Scimia said that of the 65% of occupational pension funds' assets, direct exposure to Lehman Brothers is merely 0.1%, according to the reports. Economy Minister Giulio Tremonti told parliament that the Treasury was not a creditor of Lehman Brothers, Reuters notes. Minister Tremonti added that Italy's banking system is solid and that the country would emerge from the international financial crisis "stronger than before," Reuters reports. However, the continuing uncertainty over the international impact of the collapse of Lehman Brothers has forced the Covip and Texas Teachers Retirement System to clarify their positions on Lehman Brothers, Global Pensions writes. The TRS estimated losses of US$8 million on its investments with Lehman Brothers, Global Pensions notes. According to Reuters, the Bank of Italy asserted mid last week that Italian banks and financial institutions had "limited" exposure to Lehman Brothers. Investment bank, Mediobanca, has no exposure to Lehman Brothers, a source at the bank said. The country's biggest bank by market value, UniCredit, said its exposure was very limited, Reuters notes. Insurer Assicurazioni Generali said its exposure to Lehman's debt was a maximum EUR110 million, with no exposure to its shares, Reuters relates. =================== K A Z A K H S T A N =================== AGRO LAND-BWK: Creditors Must File Claims by November 11 -------------------------------------------------------- LLP Agro Land-BWK has declared liquidation. Creditors have until Nov. 11, 2008, to submit written proofs of claims to: LLP Agro Land-BWK Rosybakiyev Str. 275-65 050060, Almaty Kazakhstan AGRO TECH: Claims Deadline Slated for November 11 ------------------------------------------------- The Specialized Inter-Regional Economic Court of Akmola has declared LLP Agro Tech Service-2000 insolvent. Creditors have until Nov. 11, 2008, to submit written proofs of claims to: The Specialized Inter-Regional Economic Court of Akmola Room 228 Auelbekov Str. 139a Kokshetau Akmola Kazakhstan Tel: 8 (7162) 25-79-32 AMISTAD LLP: Claims Filing Period Ends November 7 ------------------------------------------------- The Specialized Inter-Regional Economic Court of North Kazakhstan has declared LLP Amistad insolvent. Creditors have until Nov. 7, 2008, to submit written proofs of claims to: The Specialized Inter-Regional Economic Court of North Kazakhstan Ujnaya Str. 9 Taiynsha North Kazakhstan Kazakhstan JMO ORAL: Creditors' Claims Due on November 11 ---------------------------------------------- The Specialized Inter-Regional Economic Court of Atyrau has declared LLP Construction Company JMO Oral Spets Stroy insolvent. Creditors have until Nov. 11, 2008, to submit written proofs of claims to: The Specialized Inter-Regional Economic Court of Atyrau Third Floor Abai Str. 10a Atyrau Kazakhstan Tel: 8 (71222) 32-90-02 =================== K Y R G Y Z S T A N =================== HONG TAI: Creditors Must File Claims by November 3 -------------------------------------------------- LLC Joint Enterprise Hong Tai has shut down. Creditors have until Nov. 3, 2008, to submit written proofs of claim to: LLC Hong Tai Mederov Str. 46-1 Bishkek Kyrgyzstan ============= R O M A N I A ============= BANCPOST S.A: Fitch Affirms Individual Rating at 'D' ---------------------------------------------------- Fitch Ratings has affirmed Romania-based Bancpost S.A.'s ratings as: -- Long-term foreign currency Issuer Default Rating: affirmed at A-', Outlook Negative -- Short-term foreign currency IDR: affirmed at 'F2' -- Individual Rating: affirmed at 'D' -- Support rating: affirmed at '1' The IDRs and Support Ratings of BP reflect the potential support it can expect to receive from its majority shareholder, Greece- based EFG Eurobank Ergasias S.A. (Eurobank, rated 'A'/Stable Outlook). The Individual Rating reflects BP's weakening capitalization, still low profitability and efficiency, potential asset quality problems due to rapid loan growth and concentrated funding from the parent. These are balanced by comfortable liquidity and limited market risk. Despite a EUR50million subordinated debt issue by the parent in October 2007, Fitch eligible capital as a proportion of regulatory risk weighted assets and BP's regulatory solvency ratio weakened and equaled 7.8% and 9.8%, respectively at end-2007, reflecting the rapid growth in risk-weighted assets. Regulatory solvency ratio further weakened to 9.3% at end-H108, getting closer to the regulatory minimum of 8%. In Fitch's opinion, higher levels of capitalization would be necessary for continued loan growth and would provide a cushion for potential assets quality problems. BP's revenues continue to grow rapidly, driven by the fast growth in lending volumes, being the main catalyst of the positive operating ROAE in 2007, first time since 2004. Nevertheless, the bank is experiencing pressure on margins through rising funding costs. BP's efficiency is improving, but still weak and it should improve with the contribution of economies of scale only in the medium term. Asset quality indicators are mainly aided by rapid loan growth. Rapid loan growth and a high level of FX loans to unhedged borrowers may still create asset quality problems in the future as the loans season. This risk is mitigated to some degree by the risk management procedures implemented as per Eurobank standards. The share of related-party funding is significant and increasing, constituting 45% of total non-equity funding at end-2007. BP is making efforts to diversify its deposit base and reduce its reliance on related-party funding by exploiting the customer base and structuring new products to attract a widespread retail deposit base, which would be a relatively more stable source of funding. BP's liquidity remained comfortable due to strict regulations on reserve requirements. BP ranked as the fifth-largest bank in Romania at end-2007 in terms of assets, and had a 5.2% share of system assets. BP is primarily a retail bank, with consumer lending, mortgages and micro lending making up 70% of the total portfolio on a stand- alone basis. Taking into account the loans booked abroad, the retail segment's share declines to 58%. Eurobank first took a stake in 2000; and its shareholding was 77.56% at end-H108. BANCA ROMANEASCA: Fitch Holds 'D' Individual Rating --------------------------------------------------- Fitch Ratings has affirmed Romania-based Banca Romaneasca S.A.'s ratings as: -- Long-term foreign currency Issuer Default Rating: affirmed at 'BBB+', Outlook Stable -- Short-term foreign currency IDR: affirmed at 'F2' -- Individual Rating: affirmed at 'D' -- Support rating: affirmed at '2' The Long- and Short-Term Issuer Default and Support Ratings of BROM reflect the potential support available from its 89% parent, National Bank of Greece (NBG; rated 'A-' Stable). The Individual Rating reflects the bank's small size, weak customer deposit franchise and the credit risks from its rapid expansion. It also reflects improvements made in risk management with guidance from its parent, comfortable liquidity and limited market risk. Although the bank has been owned by NBG since 2003, extensive restructuring and branch network expansion began in 2005. These programs are set to continue, as the bank intends to increase its market share from 2.7% at end-2007 to 4.5% at end-2009 through organic growth, which appears a challenging target in a market with intense competition. Ongoing organic growth, intense competition for market share and rising funding costs undermine the improvements in profitability and efficiency. Improvement in efficiency is expected to take some time as the bank continues to expand its network. Although asset quality has been good to date, rapid loan growth and FX lending to unhedged borrowers creates potential credit and operational risks. Nevertheless improved risk management systems with the guidance from NBG provide some comfort on future asset quality. The bank's heavy reliance on parent funding continues. Liquidity is comfortable, similar to other Romanian banks, adhering to the National Bank of Romania's stringent liquidity measures. Capitalization declined as a result of rapid growth of risk weighted assets at end-2007. In March 2008, capital was increased by a cash capital injection of EUR46 million and another EUR50 million capital injection is planned in 2008. In Fitch Rating's opinion continued cash capital injections will be necessary as internal capital generation is not expected to meet the bank's expected growth rates. BROM forms part of NBG's south-east European franchise. BROM is a small bank, ranking 11th in Romania with 2.58% share in system assets at end-2007. The bank provides banking services to corporates, commercial clients and individuals with a special focus on SMEs and micro businesses. =========== R U S S I A =========== KAMA-LES LLC: Creditors Must File Claims by October 11 ------------------------------------------------------ Creditors of LLC Kama-Les have until Oct. 11, 2008 to submit proofs of claims to: Ye. Yemelin Temporary Insolvency Manager Office 313 Suvorova Str. 111a 440000 Penza Russia The Arbitration Court of Komi will convene on Dec. 16, 2008, to hear the company's bankruptcy supervision procedure. The case is docketed under Case No. A29�5130/2008. The Court can be reached at: The Arbitration Court of Komi Room 407 Ordzhonikidze Str. 49a Syktyvkar Russia The Debtor can be reached at: LLC Kama-Les Oktyabrskiy prospect 125 Syuktyuvkar Komi Russia NATIONAL RESERVE: Moody's Assigns E+ Financial Strength Rating -------------------------------------------------------------- Moody's Investors Service has assigned B2/Not-Prime local currency deposit ratings, B2/Not-Prime foreign currency deposit ratings, and an E+ Bank Financial Strength Rating (BFSR) to Russia's National Reserve Bank (NRB). The outlook on all ratings is stable. At the same time, Moody's Interfax Rating Agency has assigned an A3.ru long-term national scale credit rating (NSR) to the bank. Moscow-based Moody's Interfax is majority-owned by Moody's. According to Moody's, the E+ BFSR, which translates into a Baseline Credit Assessment (BCA) of B2, is supported by NRB's strong financial fundamentals -- notably profitability, capital adequacy and efficiency. At the same time, the rating is primarily constrained by the bank's very high, albeit gradually declining, dependence on the performance of the OJSC Gazprom shares, which represent a substantial part of total assets (30% at year-end 2007). "NRB's limited franchise, large concentrations in the loan portfolio and undiversified structure of funding, which is significantly reliant on related parties, also weigh on the BFSR. The bank is part of a group with total assets estimated at US$5.6 billion at year-end 2007, which also comprises companies from civil aviation, telecommunications, agriculture, construction and some other industries consolidated under the holding company National Reserve Corporation (NRC)," says Andrey Artyukhin, a Moscow-based Moody's Vice President-Senior Analyst, and lead analyst for this issuer. "The local currency deposit rating assigned to NRB is supported by the bank's BCA of B2 and does not factor in any support from its shareholders. In Moody's view, although such support cannot be ruled out, its scope and timeliness are rather uncertain, while systemic support in the event of need is unlikely. The foreign currency deposit rating is assigned at the same level as the bank's local currency deposit rating and is not constrained by the foreign currency deposit ceiling for Russia," adds Mr. Artyukhin. Headquartered in Moscow, National Reserve Bank reported total assets of US$2.2 billion under IFRS as at Dec. 31, 2007. PIK GROUP: Fitch Puts Low-B IDRs Under Negative Watch ----------------------------------------------------- Fitch Ratings has placed Russian housebuilder OJSC PIK Group's Long-term Issuer Default rating of 'BB-' and Short-term IDR of 'B' on Rating Watch Negative. The rating action reflects Fitch's increased concerns over PIK's liquidity position, due to the company's high level of short-term debt which, coupled with the recent turmoil in the Russian financial markets, creates a material refinancing risk for the company. PIK, like many of its Russian real estate peers, operates with high levels of short-term debt, and Fitch estimates that as of mid-September 2008 the company had approximately half of its total gross debt maturing before Dec. 31, 2008. Fitch is concerned by both the large size and the short-maturity of this debt. Nevertheless, Fitch takes some comfort from PIK's plans to meet its immediate debt requirements, by mainly using operational cash flow to repay near-term debt. Operational cash flow is expected to be boosted during September-December 2008 by a series of sizeable cash receipts for the sale of housing units to the City of Moscow. PIK expects these payments alone to be enough to meet debt repayment requirements during the remainder of 2008. In addition, the company also plans to raise new finance before the end of 2008, including new bank debt and a rouble bond issue. This, along with liquidity in the form of cash and medium term undrawn facilities, should provide PIK with sufficient liquidity to cover its near-term debt requirements. However, lending to Russian real estate companies has significantly tightened over recent weeks and is expected to tighten further given the prevailing conditions in the financial markets. Therefore, the agency has concerns that PIK may not be able to raise all of its planned new debt finance. Fitch has reasonable confidence that PIK will receive its sizeable expected cash receipts from the City of Moscow (rated BBB+) on time and as planned, given the good credit profile of the counter- party, although there is still a risk that these receipts could be delayed due to unforeseen reasons. The agency notes that PIK is particularly sensitive to any delay in payment due to the short- term debt pressures it faces. At the same time, Fitch positively notes that PIK's residential real estate sales have remained strong and during H108 doubled (totaling US$1 billion) as compared with H107. Given the current uncertainty surrounding PIK's ability to raise the required cash, Fitch will closely monitor the progress of its fund raising efforts and cash receipts over the next 3 months. Should fund raising efforts take longer than planned, or cash receipts be less than expected, PIK's ratings will likely be downgraded, possibly by more than one notch. Fitch also notes that the company's ratings have little tolerance to any further negative news, including a material deterioration in residential market conditions, which Fitch believes is a possibility should there be contagion from the current financial disruption into the broader Russian economy. RENAISSANCE CAPITAL: S&P Assigns BB- Counterparty Credit Rating --------------------------------------------------------------- Standard & Poor's Ratings Services has placed its 'BB-' long-term counterparty credit rating on Russian Renaissance Capital Holdings Ltd. on CreditWatch with negative implications. The 'B' short- term rating was affirmed. "The CreditWatch placement reflects RCHL's uncertain liquidity position and financial standing following the dramatic volatility of the Russian equity market, particularly in recent weeks, and the sharp liquidity squeeze in the Russian banking sector," said S&P's credit analyst Elena Romanova. Renaissance Capital's brokerage and trading operations have suffered losses in the recent market downturn and liquidity squeeze due to market moves and the severe contraction in liquidity in the Russian equity market and banking sector. The bank announced earlier that ONEXIM Group (not rated) will become a 50% owner through the issuance of new shares for a total amount of US$500 million. Although this will significantly mitigate liquidity concerns and compensate possible loses, the extent to which market volatility and the general loss of lenders' confidence in the independent investment banking business model may make funding and other operations more difficult in the future. The CreditWatch placement will be resolved when enough detailed information is available to assess Renaissance Capital's liquidity, capitalization, and profitability in the market's current challenging conditions. "The ratings would be lowered or the outlook revised to negative if these concerns weaken credit quality and are not fully offset by the firm or its new or existing shareholders' countermeasures," said Ms. Romanova. Renaissance Group is an independent group of investment banking, asset management, merchant banking and consumer finance companies, specializing in high-opportunity emerging markets. Renaissance Group operates in Russia, Ukraine, Kazakhstan, the United Kingdom, the United States of America, Cyprus, Sub-Saharan Africa, Switzerland, Bermuda and the British Virgin Islands. ROS-MET LLC: Creditors Must File Claims by October 11 ----------------------------------------------------- Creditors of LLC Ros-Met (TIN 7444040583) have until Oct. 11, 2008 to submit proofs of claims to: R. Akhmetov Insolvency Manager Post User Box 126 455000 Magnitogorsk Chelyabinskaya Russia The Arbitration Court of Chelyabinskaya will convene on Nov. 10, 2008, to hear the bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No A76- 8209/08-34-83. The Court is located at: The Arbitration Court of Chelyabinsk Vorovskogo Str. 2 454091 Chelyabinsk Russia The Debtor can be reached at: LLC Ros-Met Lenina prospect 57 455000 Magnitogorsk Chelyabinskaya Russia ROSEVROBANK: Fitch Assigns 'D' Individual Rating ------------------------------------------------ Fitch Ratings has assigned Russia's RosEvroBank ratings of Long- term Issuer Default 'B', Short-term IDR 'B', Individual 'D', Support '5', National Long-term 'BBB-(rus)' and Support Rating Floor 'No Floor'. The Outlooks for the Long-term IDR and National Long-term rating are Stable. The ratings reflect REB's limited, albeit growing, franchise, concentrated balance sheet and potentially vulnerable liquidity. At the same time, they reflect its good reported asset quality to date and currently reasonable capitalization. The loan book continued to grow rapidly in H108 and 2007, marginally outstripping banking sector loan growth. REB mostly lends to well-established medium-sized businesses, but also to larger companies, while retail lending is mostly secured and comprised 17.8% of the end-H108 loan book. Borrower concentration is high, albeit broadly in line with peers and gradually decreasing. Reported operations with related parties are low. REB's non-equity funding remains undiversified and predominantly short-term, and is mainly sourced from customer accounts (70% at end-H108), meaning the bank's liquidity is potentially vulnerable. This, however, has been manageable so far, with a significant liquidity cushion maintained and the bank's strategy is to diversify its funding base further, albeit this will be very challenging near-term given the current market environment. REB faces repayments on foreign borrowings equal to an estimated total 14% of end-H108 liabilities in Q408 and H109 (including a US$120 million Eurobond in October 2008), but current liquid assets should be sufficient to meet these, even if the bank is not able to partially refinance. Performance has been reasonable (return on average assets 1.6% in H108; 1.9% in 2007), but is vulnerable to any marked increase in funding, operational or credit costs. The Fitch Eligible Capital and Basel tier I ratios stood at a sound 13.6% at end-H108, although these are likely to gradually fall in the absence of any near-term plans to inject new equity. REB's securities holdings are mainly in government debt and bank promissory notes, and Fitch is informed that the bank has incurred no significant losses on its securities portfolio in Q308. Upside potential for the ratings is currently limited, but REB's credit profile would benefit from continued strengthening of the franchise, a strengthening of profitability and greater funding diversification. Downward pressure could mainly result from a material weakening of asset quality and/or a major liquidity shortfall. REB is a medium-sized, Moscow-based bank, the 55th-largest in Russia by assets at end-H108. Traditionally focused on lending to corporate clients, the bank now aims to penetrate the retail and SME sectors and expand into regions. REB is owned by several individuals (84%), funds managed by Renaissance Investments Management (10%) and Deutsche Investitions- und Entwicklungsgesellschaft (6%). RUSSIAN FACTORING: Fitch Holds 'BB' Rating on RUB300BB Facility --------------------------------------------------------------- Fitch Ratings affirmed the ratings of Russian Factoring No. 1 S.A.'s debt obligations as: -- RUB5 billion senior asset-backed notes: 'BBB'; Outlook Stable -- RUB300 million mezzanine facility: 'BB'; Outlook Stable The transaction is a securitization of trade receivables acquired by CJSC Eurokommerz FC, a factoring company mainly active in the Russian Federation (rated 'BBB+'). Since December 2007, Eurokommerz has sold receivables against Russian debtors into the transaction that were originated in the ordinary conduct of its factoring business. According to the original transaction documentation the notes should now start to amortize monthly in line with the portfolio. However, Eurokommerz and the issuer - with the consent of the related parties to the transaction - have agreed to amend the transaction documentation. The affirmation reflects these proposed amendments. The issuer extended the revolving purchase commitment towards Eurokommerz until 16 March 2009 subject to certain amortization triggers to be passed during this time. The final legal maturity of the debt instruments was extended by 12 months to 15 March 2010. This one year time lag is in Fitch's view sufficient to redeem the notes from collections of funded receivables. Finally, the notes were partially redeemed. The redemption by the issuer was funded via a buy back of receivables by Eurokommerz as of 19 September 2008. The key structural features of the transaction remain unchanged. These include the dynamic determination of credit enhancement, as well as the role of JSC VTB Bank as backup servicer. Since closing, the collection account holding bank was acquired in full by the Kazakh BTA group. Former Slavinvestbank was rebranded to "LLC BTA Bank" but continues to act as collection account holding bank. Its current rating equals 'B+', negative outlook. If it were to fall below 'B-', the transaction foresees the closing of all accounts and a redirection of payments to the backup servicer. Enhancement stands at 32% for the senior notes and 28% for the mezzanine facility. Enhancement is made up by three components to cover defaults, carrying costs and commingling exposure. Based on information provided by Eurokommerz, the transaction has not observed any defaults of debtors or customers with regard to the receivables sold. It has to be noted though that the corporate segment that forms the customer base of Eurokommerz is likely to be affected by the liquidity squeeze currently experienced by the Russian banking system. With banks reducing their financing commitments against SME's, the factoring business may be affected in two ways. First, demand for factoring as a funding source is likely to increase. Second, higher delinquencies and also the first defaults may show up in the securitized portfolio due to a higher number of debtors that face refinancing problems, and potentially insolvency. Due to its short-term nature, Fitch expects the factoring business to reflect negative trends in the overall economy relatively early on in a downward cycle. Fitch takes comfort from the monthly determination of the required loss protection that is in line with Fitch's trade receivables criteria. While there have been no losses yet, the loss floor calculation ensures that a minimum loss of 8.5% for the senior note and 6% for the mezzanine facility will be covered under the transaction. Fitch has taken the view that these levels of protection may also limit the refinancing burden on the seller to increase enhancement by raising the subordinated loan granted to the issuer. SIB-LES LLC: Creditors Must File Claims by November 11 ------------------------------------------------------ Creditors of LLC Sib-Les have until Nov. 11, 2008 to submit proofs of claims to: A. Shirobokov Insolvency Manager Post User Box 502 660022 Krasnoyarsk Russia The Arbitration Court of Krasnoyarskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A33�9069/2008. The Court is located at: The Arbitration Court of Krasnoyarsk Lenina Str. 143 660021 Krasnoyarsk Russia The Debtor can be reached at: LLC Sib-Les Yaroslavskaya Str.6/1 Lesosibirsk Russia SVIAZ-BANK: Moody's Cuts Bank Financial Strength Rating to E ------------------------------------------------------------ Moody's Investors Service has downgraded Sviaz-Bank's long-term global local and foreign currency deposit ratings to Caa2 from B2 and its bank financial strength rating to E from E+. The short- term deposit ratings have been affirmed at Not Prime. At the same time, Moody's Interfax Rating Agency, which is majority-owned by Moody's, has downgraded Sviaz-Bank's long-term National Scale Rating to B2.ru from Baa1.ru. All ratings have been placed on review with direction uncertain. Moody's and Moody's Interfax explain that the rating downgrades have been prompted by Sviaz-Bank having defaulted on its obligations on repurchase transactions and having incurred a significant decrease in asset value that has significantly damaged its capital. This has largely been as the result of the impact of the current extremely adverse market conditions on the bank's sizeable risk positions arising from its high risk appetite. The rating review with direction uncertain captures the present uncertainty with regard to the possible outcomes of Sviaz-Bank's current situation. On the one hand, if the bank manages to receive additional support either from the regulatory authorities or from a financially stronger strategic partner that assumes its obligations, recapitalizes the bank and restores its risk management parameters and financial stability, Moody's would be likely to upgrade Sviaz-Bank's deposit ratings. On the other hand, if the bank fails to be supported or to attract a potential strategic partner and is therefore at risk of defaulting on its other obligations, such failure will likely merit further rating downgrades. Moody's understands that the bank is currently in negotiations with publicly undisclosed parties with regard to possible mechanisms for further support. These negotiations are focused on matters including a possible recapitalization and the provision of assistance in a restructuring of the bank's liabilities. Based in Moscow, Russia, Sviaz-Bank is a universal bank with a wide presence in the Russian regions (about 50 branches covering almost the whole country). As of June 30, 2008, the bank reported total assets of RUB170 billion in accordance with Russian Accounting Standards. TIMBER CENTER: Creditors Must File Claims by November 11 -------------------------------------------------------- Creditors of LLC Timber Center have until Nov. 11, 2008 to submit proofs of claims to: P. Tarasov Insolvency Manager Post User Box 19 Postal Telegraph Office 100 170100 Tver Russia The Arbitration Court of St. Petersburg commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No ?56-44510/2007. The Court is located at: The Arbitration Court of St. Petersburg and the Leningrad Hall 113 Suvorovskiy Pr. 50/52 St. Petersburg Russia The Debtor can be reached at: LLC Timber Center Liter A K. Zaslonova Str.26 191119 St. Petersburg Russia VYATKO-KOMPLEKT: Kirov Bankruptcy Hearing Set November 30 --------------------------------------------------------- The Arbitration Court of Kirov will convene at 2:00 p.m. on Nov. 30, 2008, to hear bankruptcy supervision procedure on LLC Vyatko- Komplekt . The case is docketed under Case No. A28-5466/ 2008- 144/3. The Temporary Insolvency Manager is: S. Shumin Ordzhonikidze 12/105 610008 Kirov Russia The Court is located at: The Arbitration Court of Kirov K-Libknekhta Str. 102 610017 Kirov Russia The Debtor can be reached at: LLC Vyatko-Komplekt Apt.148 M. Koneva Str. 7 610021 Kirov Russia * S&P Revises Outlook to Stable on Seven Low-B Rated Russian Banks ------------------------------------------------------------------ Standard & Poor's Ratings Services has revised its outlooks on the long-term ratings on seven Russian financial institutions to stable from positive. The long-term ratings on all the banks were affirmed, but the national scale ratings on two of the seven were lowered. The outlook revisions reflect the fact that market conditions in Russia have become much more difficult and volatile, especially with regard to the tightened liquidity situation and tougher refinancing conditions. S&P expects these factors to pressure banks' near-term financial performance and financial flexibility, as well as hinder their strategic expansion goals. For a more in-depth analysis on the impact of the ongoing liquidity squeeze and stock market turbulence in Russia's banking sector, please see the article "Financial Turbulence Tests Resilience Of Russian Banks And State Support For Banking Sector," published on RatingsDirect. Following today's outlook revisions, none of the banks with long- term ratings in Russia that S&P rates has a positive outlook. S&P's lowering of the Russia national scale ratings on two of the seven banks reflects the more granulated credit ratings approach under its national ratings scale. Ratings List To From ------------ -- ---- Bank Soyuz Counterparty Credit Rating B/Stable/C B/Positive/B Russia national scale ruA- ruA Commercial Bank Petrocommerce (OJSC) Counterparty Credit Rating B+/Stable/B B+/Positive/B Russia national scale ruA+ ruA+ National Factoring Company Counterparty Credit Rating B-/Stable/C B-/Positive/C Russia national scale ruBBB ruBBB+ Rosbank OJSC Counterparty Credit Rating BB+/Stable/B BB+/Positive/B Russia national scale ruAA+ ruAA+ Rusfinance Bank Counterparty Credit Rating BB+/Stable/B BB+/Positive/B Russia national scale ruAA+ ruAA+ Surgutneftegasbank Counterparty Credit Rating B+/Stable/B B+/Positive/B TransCreditBank Counterparty Credit Rating BB/Stable/B BB/Positive/B Russia national scale ruAA ruAA * S&P Says Russian Govt. Financial Support Outcomes Unpredictable ----------------------------------------------------------------- Standard & Poor's Ratings Services is seeing more Russian government willingness to pursue orthodox support measures to address financial turmoil. However, the continued institutional weakness in Russia makes the outcome of the measures unpredictable. This is not the first time, and will not be the last, as Russia is prone to liquidity panics in the interbank and retail markets. The Russian banking system continues to be severely tested by the sharp liquidity squeeze and the massive volatility in global equity markets. No ratings on financial institutions in the country have so far been lowered, although the positive outlooks on the long-term ratings on seven Russian financial institutions have been revised to reflect the fact that market conditions have become much more difficult and volatile, particularly the tightened liquidity situation and tougher refinancing conditions. These factors are expected to pressurize banks' near-term financial performance and flexibility. The Russian government has been active in supporting the banking market by injecting liquidity resources, whereby the peak of central bank daily repo financing to banks reached RUR365 billion (about US$14.6 billion) on Sept. 17, 2008, to the large state- controlled banks. These funds could be used to filter down through the interbank market to ease the liquidity situation, but in reality small and midsize banks may not benefit, and thus continue to suffer from a lack of rubles in the market. In addition, the government has reduced reserve requirements by 4% and cut crude oil export taxes to offset the effects of the lower oil price. These measures, however, are not a panacea for long- term stability. S&P expects that sharp periods of volatility in the market will continue putting pressure on banks, especially the small and midsize ones and those which have sizable refinancing programs in the coming months. Credit is likely to become scarcer, which will have a negative impact on asset quality and growth dynamics. Corporate depositors will use their cash to repay debt coming due while retail depositors might consider a flight to quality. However, with the interbank market being closed for many small banks, with lines being cut by their bigger peers and higher interest rates, there will be a dash for cash and more banks may experience liquidity problems. This is likely to be exasperated by the continuing closure of the international debt markets for the banks to tap, particularly as sizable debt refinancing needs to take place during the coming six months. As a knock-on impact, asset quality may then start to suffer as a credit squeeze will prevent borrowers financing their own projects and investments. The settlement problems encountered last week by KIT Finance (not rated), a midsize investment bank, is clear evidence of an institution over-extending itself without having the necessary long-term funding lines or resources in place. An inability to meet margin call repayments in a slumping market was the catalyst for the bank's failure. S&P's 'CCC+' rating was withdrawn at the bank's request on Feb. 5, 2008. Following the intervention of the government, KIT has subsequently been taken over by Leader (not rated), an asset management company of OAO Gazprom's (BBB/Stable/--) related pension fund Gazfond (not rated). On Aug. 6, 2008, S&P raised the Banking Industry Country Risk Assessment for The Russian Federation to Group 7 from Group 8. At the same time, S&P changed its assessment of the Russian government's propensity to provide support to private sector banks to 'supportive' from 'support uncertain'. These actions particularly reflected Russia's increased political and regulatory commitment to ensure the stability of the banking sector, as highlighted by the Central Bank of Russia's effective management of liquidity pressures related to the global credit crunch since summer 2007. However, Russian banks' creditworthiness remains relatively weak compared to that of banks in other countries, reflecting: -- High liquidity risk; -- Increased reliance on confidence-sensitive wholesale funds and foreign borrowing; -- Substantial concentrations in lending, funding, and revenues; -- Strained capitalization amid balance-sheet growth; -- Risks related to poor transparency and information disclosure in most parts of the sector; -- Slow pace of banking-sector reform; and -- Unpredictable legal environment and uncertain property rights. The more highly rated banks in Russia, including the state- controlled banks, Bank VTB (BBB+/Stable/A-2) and Gazprombank (BBB- /Stable/A-3), and the large foreign-owned banks, Raiffeisenbank ZAO (BBB+/Stable/A-2) and CJSC Unicredit Bank (Russia) (BBB+/Stable/A-2), benefit largely from external support from their controlling owners, respectively the government and foreign bank shareholders. On a stand-alone basis, their ratings would be several notches lower, which again reflects the weaknesses of the banking system. Depending upon the support received and the way that these banks are able to navigate through these difficult times, the gap in the ratings with the domestically-owned private- sector banks may widen further. The ratings on Russian banks take into account a volatile operating environment, which affects the banking system on a periodic basis, particularly liquidity squeezes. At the end of last week, the two main Russian equity markets, RTS and MICEX re-opened after the government temporally closed them on Sept. 17, 2008, after two days of heavy selling, which saw the indexes experience their worst falls in a decade, since the crisis that affected the country and banking system in 1998. The rise in the indexes on Sept. 19, 2008, after the announcement of the government's support measures and the action taken by governments and central banks around the globe to stabilize banking markets, have helped relieve some pressure on the Russian banks. Current ratings, however, do take into account high levels of market volatility, which makes the banking system vulnerable. * UDMURTIA REPUBLIC: Moody's Assigns Ba1 Currency Issuer Ratings ---------------------------------------------------------------- Moody's Investors Service has assigned global scale local and foreign currency issuer ratings of Ba1 to the Republic of Udmurtia within the Russian Federation. The rating outlook is stable. At the same time, Moody's Interfax Rating Agency, which is majority- owned by Moody's, has affirmed the Republic's existing Aa1.ru national scale rating. "The ratings are supported by a healthy budgetary performance and a low-to-moderate debt burden over a number of years," says Alexander Proklov, a Moody's vice president and lead analyst for the region. The republic's gross operating surplus amounted to 15% of operating revenues in 2006 and 21% in 2007, while the ratio of total debt to operating revenue was close to 14% at the end of 2007. Strong operating results have been underpinned by a rapid growth in personal and corporate income taxes on the back of high oil prices and continuing economic growth in the republic. Moody's also notes that the ratings are constrained by a large exposure to taxpayers from the oil industry which has generated 30%-35% of the budget's tax revenue in recent years. "Corporate income tax receipts, which accounted for 43% of the Republic's tax revenue in 2007, are highly affected by the volatility of the global oil market prices," adds Mr. Proklov. Another factor exerting pressure on the Republic's credit profile is the rigidity of operating expenditure coupled with a strong need for new infrastructure. "The inflexible and rising operating spending base, combined with growing capital expenditures, could cause a rise in the debt burden over the medium term. A sustained commitment to a prudent policy framework will therefore be important to manage this situation, particularly at a time of financial market volatility and a stubbornly high inflation rate" said the analyst. Udmurtia is located in eastern Europe, bordering the Urals, and is part of the Volga Federal District. It has a population of 1.5 million, or 1.1% of Russia's entire population, and 69.4% of it is urban. Gross Regional Product (GRP) is approximately 0.7% of Russian Gross Domestic Product (GDP). Oil extraction and machine manufacturing dominate the republic's economy. ========= S P A I N ========= HABITAT: Calls EGM to Decide on Future; Facing Dissolution ---------------------------------------------------------- Spanish property firm Habitat has called for an extraordinary general meeting to decide on its future, Reuters reports. The EGM, the report discloses, will be held on Oct. 24, 2008. Habitat, the report says, will ask its shareholders, which include Ferrovial and a group of Catalan investors, to either inject capital into the company or accept a reduction in its share capital. According to the report, the value of Habitat's assets fell below half that of its share capital, putting the company at risk of being dissolved. Under Spanish corporate law, a limited company must maintain the value of its assets above a threshold fixed at half the value of its share capital otherwise it will be dissolved, the report notes. Habitat, the report relates, met with its creditor banks Friday last week in an attempt to refinance its EUR1.5 billion debt pile and avoid filing for administration. However, preliminary talks failed to produce a refinancing agreement. The syndicate of 39 creditor banks is led by Spain's biggest savings bank, La Caixa, the report reveals. ===================== S W I T Z E R L A N D ===================== CARGO CARE: Proofs of Claim Filing Deadline is October 5 -------------------------------------------------------- Creditors owed money by LLC Cargo Care Maritime are requested to file their proofs of claim by Oct. 5, 2008, to: JSC Trevesa Steinenring 46 4051 Basel Switzerland The company is currently undergoing liquidation in Basel. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Aug. 21, 2008. CBD CREATIVE: Creditors' Proofs of Claim Due by October 5 --------------------------------------------------------- Creditors owed money by LLC CBD Creative Business Development are requested to file their proofs of claim by Oct. 5, 2008, to: Adam Grzesicki-Hauri Rabmatt 33j 6317 Oberbwil b. Zug Switzerland The company is currently undergoing liquidation in Zug. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Aug. 20, 2008. CREA CDO I: October 5 Set as Deadline to File Proofs of Claim ------------------------------------------------------------- Creditors owed money by JSC CREA CDO I are requested to file their proofs of claim by Oct. 5, 2008, to: JSC MMC Finance Seefeldstrasse 301 8008 Zurich Switzerland The company is currently undergoing liquidation in Zurich. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Aug. 6, 2008. DAVIT JSC: Creditors Must File Proofs of Claim by October 5 ----------------------------------------------------------- Creditors owed money by JSC Davit are requested to file their proofs of claim by Oct. 5, 2008, to: JSC Blumer-Lehmann Erlenhof, 9200 Gossau SG Switzerland The company is currently undergoing liquidation in Herisau. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Aug. 18, 2008. LAIMBACHER UNTERNEHMENSBERATUNG: Claims Due by October 15 --------------------------------------------------------- Creditors owed money by LLC Laimbacher Unternehmensberatung are requested to file their proofs of claim by Oct. 15, 2008, to: Grosssteinstrasse 22b 6438 Ibach Switzerland The company is currently undergoing liquidation in Schwyz. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on July 2, 2008. PERSIST JSC: Creditors Have Until October 4 to File Claims ---------------------------------------------------------- Creditors owed money by JSC Persist are requested to file their proofs of claim by Oct. 4, 2008, to: Nathalie Grundler-Ruepp Schlusselackerstrasse 20 5614 Sarmenstorf Switzerland The company is currently undergoing liquidation in Sarmenstorf. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Aug. 6, 2008. SPORTHOTEL SHERLOCK: Deadline to File Claims Set October 5 ---------------------------------------------------------- Creditors owed money by JSC Sporthotel Sherlock Holmes are requested to file their proofs of claim by Oct. 5, 2008, to: Ernst Hofmann Personalverband des Bundes Oberdorfstrasse 32 3072 Ostermundigen Switzerland The company is currently undergoing liquidation in Meiringen. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on July 7, 2008. ============= U K R A I N E ============= AZOVSTAL IRON: S&P Lifts Corporate Credit Rating to B+ ------------------------------------------------------ Standard & Poor's Ratings Services has raised its long-term corporate credit rating on Ukraine-based JSC Azovstal Iron and Steel Works to 'B+' from 'B-' on support from its parent company Metinvest B.V. (not rated) and strong operating performance. The outlook is stable. At the same time, the rating on finance vehicle Azovstal Capital B.V.'s US$175 million senior unsecured loan participation notes was raised to 'B' from 'B-'. The recovery rating on the notes is now '5'. "The ratings reflect Azovstal's stand-alone credit quality as well as our expectation that it will receive ongoing and extraordinary support from its financially stronger parent company Metinvest B.V., which controls 97% of Azovstal's shares," said S&P's credit analyst Andrey Nikolaev. Azovstal is the largest asset of Metinvest Holding and generates about 25% of the group's EBITDA. It also provides a vital link between the holding's mining assets in Ukraine and its rolling plants in Europe. Furthermore, Azovstal is a co-borrower under several of Metinvest's credit facilities, which represent a significant part of its debt, increasing parental incentive to support Azovstal. The rating is constrained by the company's position as a commodity player in a cyclical industry; by the country risks of Ukraine (foreign currency, B+/Stable/B; local currency BB-/Stable/B), where Azovstal operates; its aged asset base that requires large capital expenditures; and by the weak liquidity of Metinvest Group. Although Azovstal's balance sheet debt is moderate, its co-borrowings under several Metinvest credit facilities increase its leverage considerably. These risks are tempered by Azovstal's high share of exports (more than 70% of sales), access to low-cost resources in Ukraine, and vertical integration in iron ore, coke, and scrap at the parent level. The company is undertaking an ambitious US$3.7 billion capital- expenditure program between 2006 and 2016 to modernize its aged asset base. Although this is strategically important to its long- term competitiveness, the program will limit free operating cash flow generation in the coming years, as will large working-capital fluctuations. On Dec. 31, 2007, the company had moderate total debt of UAH1.2 billion, postretirement benefit obligations of UAH0.6 billion, and guarantees issued of UAH137 million, implying a ratio of adjusted debt to EBITDA of 0.6x. In the future, Azovstal's financial flexibility will depend to a significant extent on debt at Metinvest Holding, which is currently moderate. "The stable outlook reflects our expectation that Azovstal will remain the key asset of Metinvest Holding, which will provide support if necessary," said Mr. Nikolaev. BAKHMACHBREAD LLC: Creditors Must File Claims by September 27 ------------------------------------------------------------- Creditors of LLC Bakhmachbread have until Sept. 27, 2008, to submit proofs of claim to: The Economic Court of Chernigov Mir Str. 20 14000 Chernigov Ukraine The Economic Court of Chernigov commenced bankruptcy proceedings against the company after finding it insolvent on Aug. 11, 2008. The case is docketed as 9/69b. The Debtor can be reached at: LLC Bakhmachbread Tinitskaya Str. 82 Bakhmach 16500 Chernigov Ukraine BELTAN LLC: Creditors Must File Claims by September 28 ------------------------------------------------------ Creditors of LLC Beltan (code EDRPOU 35276056) have until Sept. 28, 2008, to submit proofs of claim to: The Economic Court of Donetsk Artem Str. 157 83048 Donetsk Ukraine The Economic Court of Donetsk commenced bankruptcy proceedings against the company after finding it insolvent on Aug. 20, 2008. The case is docketed as 27/141B. The Debtor can be reached at: LLC Beltan Titov Avenue 15 Donetsk Ukraine DNIEPROVSKIYE ZORI: Creditors Must File Claims by September 28 -------------------------------------------------------------- Creditors of LLC Dnieprovskiye Zori (code EDRPOU 32068756) have until Sept. 28, 2008, to submit proofs of claim to: The Economic Court of Kiev B. Hmelnitskiy Str. 44-b 01030 Kiev Ukraine The Economic Court of Kiev commenced the bankruptcy supervision procedure on the company on July 7, 2008. The case is docketed as 28/209-b. The Debtor can be reached at: LLC Dnieprovskiye Zori Narodnogo Opolcheniya Str. 1 03151 Kiev Ukraine FORLAND LLC: Creditors Must File Claims by September 26 ------------------------------------------------------- Creditors of LLC Forland (code EDRPOU 34506795) have until Sept. 26, 2008, to submit proofs of claim to: The Economic Court of Odessa Shevchenko Avenue 29 65009 Odessa Ukraine The Economic Court of Odessa commenced bankruptcy supervision procedure on the company. The case is docketed 7/188-08-3247. The Debtor can be reached at: LLC Forland Bolgarskaya Str. 25 65028 Odessa Ukraine MANDARIN 2004: Creditors Must File Claims by September 26 --------------------------------------------------------- Creditors of LLC Mandarin 2004 have until Sept. 26, 2008, to submit proofs of claim to: The Economic Court of Odessa Shevchenko Avenue 29 65009 Odessa Ukraine The Economic Court of commenced bankruptcy proceedings against the company after finding it insolvent on March 27, 2008. The case is docketed as 2/59-08-1101. MBD-LOGISTICS LTD: Creditors Must File Claims by September 26 ------------------------------------------------------------- Creditors of LLC MBD-Logistics Ltd (code EDRPOU 22470692) have until Sept. 26, 2008, to submit proofs of claim to: The Economic Court of Odessa Shevchenko Avenue 29 65009 Odessa Ukraine The Economic Court of Odessa commenced bankruptcy proceedings against the company after finding it insolvent on Jan. 30, 2008. The case is docketed as 32-3/286-07-8391. The Debtor can be reached at: LLC MBD-Logistics Ltd Gaydar Str. 13 Odessa Ukraine NOSOVKA REGIONAL: Creditors Must File Claims by September 28 ------------------------------------------------------------ Creditors of LLC Nosovka Regional Milk Plant (code EDRPOU 32319861) have until Sept. 28, 2008, to submit proofs of claim to: The Economic Court of Chernigov Mir Str. 20 14000 Chernigov Ukraine The Economic Court of Chernigov commenced bankruptcy proceedings against the company after finding it insolvent on July 22, 2008. The Debtor can be reached at: LLC Nosovka Regional Milk Plant Vokzalnaya Str. 268-a Nosovka 17100 Chernigov Ukraine =========================== U N I T E D K I N G D O M =========================== AMERICAN INTERNATIONAL: Loses US$5.36 Billion in Second Quarter --------------------------------------------------------------- Reuters reports that the American International Group Inc. lost US$5.36 billion in the second quarter on bad mortgage investments, its third straight quarterly loss. According to the report, AIG employs more than 116,000 employees, and many full- and part-time agents, worldwide. AIG, according to Reuters, operates in 130 countries and jurisdictions, including Brazil, China, India and Taiwan, as well as the United States and United Kingdom. The company currently has assets of more than US$1 trillion. As reported in the Troubled Company Reporter on Sept. 17, 2008, the Federal Reserve Board, with the full support of the Treasury Department, authorized the Federal Reserve Bank of New York to lend up to US$85 billion to AIG in exchange for an 80% stake in the company. The bailout brings U.S. rescue efforts to stabilize the financial system and housing market to about US$900 billion, according to Reuters. In a U.S. Securities and Exchange Commission filing dated Aug. 6, 2008, AIG reported a net loss for the second quarter of 2008 of US$5.36 billion compared to 2007 second quarter net income of US$4.28 billion. Second quarter 2008 adjusted net loss was US$1.32 billion, compared to adjusted net income of US$4.63 billion for the second quarter of 2007. The continuation of the weak U.S. housing market and disruption in the credit markets, as well as global equity market volatility, had a substantial adverse effect on AIG's results in the second quarter. Net loss for the first six months of 2008 was US$13.16 billion, compared to net income of US$8.41 billion in the first six months of 2007. Adjusted net loss for the first six months of 2008 was US$4.88 billion, compared to adjusted net income of US$9.02 billion in the first six months of 2007. About American International Group Based in New York City, American International Group Inc. -- http://www.aig.com/-- (NYSE: AIG) is an international insurance and financial services organization, with operations in more than 130 countries and jurisdictions. The company is engaged through subsidiaries in General Insurance, Life Insurance & Retirement Services, Financial Services and Asset Management. The company's British headquarters are located on Fenchurch Street in London, continental Europe operations are based in La Defense, Paris, and its Asian HQ is in Hong Kong. AIG owns Ocean Finance, a United Kingdom based company providing home owner loans, mortgages and remortgages. AIG operates in the UK with the brands AIG UK, AIG Life and AIG Direct. It has about 3,000 employees, and sponsors the Manchester United football club. In response to redemption demands, AIG Life (UK) suspended redemptions of its AIG Premier Bond money market fund on Sept. 19, 2008, in order to provide an orderly withdrawal of assets. * * * As reported by the Troubled Company Reporter on Sept. 19, 2008, Fitch Ratings revised its Rating Watch on American International Group, Inc. to Evolving from Negative. Fitch's action follows AIG's announcement that its board has approved a transaction under which the Federal Reserve Bank of New York will provide AIG with a two- year US$85 billion secured revolving credit facility. Fitch views this transaction as a favorable development that alleviates significant near-term liquidity concerns. The agency plans to issue a more detailed analysis in support of this action. Fitch has revised the Rating Watch Status on these ratings to Evolving from Negative: American International Group, Inc. -Long-term IDR 'A'; Senior debt 'A'; Junior subordinated debentures 'A-'; and Short-term IDR to 'F1'. The Rating Watch status on the following 'AA-' Insurer Financial Strength ratings have been revised to Evolving from Negative include Foreign Domiciled General Ins. Companies; AIG MEMSA Insurance Company Ltd. (UAE); AIG (UK) Ltd. (formerly The Landmark Insurance Co. Ltd. (UK); and American International Underwriters Overseas, Ltd. (Bermuda). On Sept. 19, 2008, the TCR reported that Standard & Poor's Ratings Services revised the CreditWatch status of most of its ratings on the AIG group of companies--including its 'A-' long-term counterparty credit ratings on American International Group Inc. and International Lease Finance Corp. and the 'A+' counterparty credit and financial strength ratings on most of AIG's insurance operating subsidiaries--to CreditWatch developing from CreditWatch negative. Standard & Poor's also said that it raised its short- term counterparty ratings on AIG, its guaranteed subsidiaries, and ILFC to 'A-1' from 'A-2'. In addition, Standard & Poor's lowered the ratings on various subsidiaries' preferred shares to 'B' from 'BBB'; the ratings on the preferred shares remain on CreditWatch negative because of the increased risk of deferral of dividend payments due to the right of the U.S. government to veto dividend payments. The 'BBB/A-3' counterparty credit rating on American General Finance Corp. is unchanged. The outlook is negative. BRADFORD & BINGLEY: U.K. Regulator Working on Firm's Takeover ------------------------------------------------------------- The Sunday Telegraph reports that U.K.'s Financial Services Authority (FSA) has approached Spain's Santander Bank, the Netherlands' ING Groep N.V. and National Australia Bank to gauge their interest in a takeover of Bradford & Bingley plc. People familiar with the situation told The Telegraph the regulator is working with the bank's board to find a long-term solution to the challenges it has faced in recent months, including a rights issue that had to be restructured twice and concerns about its ability to fund its lending. The sources said however it isn't clear whether the three banks are interested to do a deal with Bradford & Bingley or at what price any takeover might be pitched. Sources close to Bradford & Bingley meanwhile said the company was not currently in takeover talks and that a deal was not imminent, pointing out that the firm was adequately funded and that depositors' money was safe, The Telegraph notes. The Financial Times relates the bank has just completed a GBP400 million rights issue and its core equity Tier 1 ratio �- a measure of strength �- is 9.1%, one of the highest in the sector. However, the FT says about 85% of its mortgage book is riskier buy-to- let and self-certified mortgage loans. News of the U.K. regulator's move sent Bradford & Bingley's stock 1.8% higher to 28.25 pence, reducing this year's decline to 89%, Bloomberg News reports. Bloomberg News also said the rise in Bradford & Bingley's shares followed the FSA's decision to ban investors from taking new short positions in more than two dozen banks and financial companies last week. According to the report, some politicians and investors have blamed short sellers for the plunge in shares of Bradford & Bingley. As reported in the Troubled Company Reporter-Europe on Sept. 18, 2008, Moody's Investors Service downgraded Bradford & Bingley plc's financial strength rating (BFSR) to D from C-; subordinated debt rating to Ba3 from Baa2 and junior subordinated debt rating to B1 from Baa2. The outlook on all ratings is negative. The rating action concluded the review for possible downgrade on the bank's ratings (with exception of the short term ratings, which had not been under review) that had been initiated on July 4, 2008. For the first six months ended June 30, 2008, Bradford & Bingley posted GBP17.2 million in net losses on GBP246.7 million in net revenues, compared with GBP129 million in net profit on GBP271.2 million in net revenues for the same period in 2007. About Bradford & Bingley Headquartered in Bingley, United Kingdom, Bradford & Bingley plc -- http://www.bbg.co.uk/-- offers residential mortgages, and focus on a range of areas providing mortgages for individuals. It focuses on its savings business and provides a range of savings products through 197 branches and network of 140 third- party branch-type agents, by phone, post and Online. CHASE MIDLAND: Owes Creditors More Than GBP22 Million ----------------------------------------------------- Chase Midland plc owed creditors more than GBP22 million, according to a report by the company's administrator Ernst & Young, Jennifer Rigby writes for Property Week. The company went into administration in July after running into severe cashflow problems, resulting to 49 job losses. The administrators' report said "In the months preceding administration, the housing market softened considerably, resulting in a low volume of reduced price sales. "The reduction in sales was exacerbated by funders, aware of the reduction in the underlying value of the assets over which they held security, seeking to increase the percentage they received from each sale. Furthermore, cost overruns on certain developments, most notably Harborne Apartments, added to the group's cashflow problems." Chase Midland incurred a loss of almost GBP2 million in 2006. Its most recent unaudited accounts, to March 2008, show a loss of GBP436,000, Property Week relates. Chase Midland's creditors include Royal Bank of Scotland, Dunbar and Yorkshire Bank. Dunbar, Property Week discloses, appointed LPA (Law of Property Act) receivers over each of the nine properties it lent on. Meanwhile, other land and assets held by Chase Midland are being put up for sale. Property Week adds the administrators are also seeking legal advice over seven litigation claims that Chase Midland was pursuing prior to the administration. Chase Midland, Property Week reveals, also provided guarantees of GBP11 million to customers of construction unit Chase Norton Construction, which is also in administration. Property Week however notes the chance of these guarantees being called upon was a "serious risk", following the administration of the construction unit. As reported in the TCR-Europe, Ian Best and Diana Frangou of Ernst & Young LLP were appointed joint administrators of Chase Midland plc on July 3, 2008. FERGUS HAYNES: Goes Into Receivership; Owes EUR15 Million --------------------------------------------------------- Donegal-based Fergus Haynes (Developments) has gone into receivership after racking up debts of more than EUR15 million (GBP11.9 million), David Doyle of Property Week reports. Grant Thornton Ireland was appointed receivers to the company. Creditors of the company founded by developer Charles Fergus include Bank of Scotland, Bank of Ireland and National Irish Bank, the report discloses. According to Sunday Business Post, Bank of Scotland is owed EUR6 million and Bank of Ireland is owed EUR1 million. National Irish Bank, on the other hand, has advanced the company EUR2.5 million. Bank of Scotland, the Post relates, took control of the company's sites in Co Donegal after the High Court rejected a petition by the firm's directors for it to be placed into examinership. Atradius, a credit insurance firm representing two major creditors, had earlier petitioned the High Court to wind up the business, the Post adds. Meanwhile, Anglo Irish Bank, which financed Rambling Lane's 12- acre development site at Lambourne Road, Chigwell, Essex, approached the High Court, expressing concerns over how their money is secured. Rambling Lane is owned by Fergus, Property Week notes. Property Week says Mr. Fergus had offered the bank a charge against his home in Donegal of EUR200,000 (GBP159,000). However, the bank argued it had no proof of Fergus' ownership of the property or its worth. The bank also claimed the value of the site in Epping is worth less than the debt Fergus owes, Property Week states. The value of the site had dropped from EUR800,000 (GBP634,000) to EUR700,000 (GBP554,000). LEHMAN BROTHERS: Nomura Reaches Deal to Buy Eur & Mid-East Biz -------------------------------------------------------------- Nomura Holdings Inc. had reached an agreement to acquire the European and Middle Eastern equities and investment banking operations of Lehman Brothers Holdings Inc. The acquisition will provide Nomura with a market leading equities and investment banking platform in the region and further enhance Nomura's strategy of connecting Asia and Europe. The deal follows Nomura's agreement on Sept. 22, 2008, to acquire Lehman Brothers' entire franchise in the Asia Pacific region including Japan and Australia. Lehman's equities and investment banking businesses in Europe and the Middle East employed around 2,500 staff, of whom a significant proportion are expected to be retained. Bloomberg News and The Associated Press relate that Nomura will keep Lehman's 3,000 employees in Tokyo, Seoul, Beijing, Shanghai, Hong Kong, Taiwan, Thailand, Singapore, Mumbai, Sydney and Melbourne. Nomura also said it would keep on most of Lehman's 2,500 workers in the U.K., Germany, Switzerland, Spain, the Middle East, Sweden and Russia, the reports say. The deal does not include any trading assets or trading liabilities and Nomura will pay an undisclosed sum for the businesses. Bloomberg's Takahiko Hyuga reports that Nomura will pay less than a month's revenue for the bankrupt bank's units. AP reported Monday, citing people familiar with the matter, that Nomura's acquisition of Lehman's Asian operations was valued at around US$225 million. Kenichi Watanabe, Nomura's CEO, said: "This transaction will significantly extend our European footprint and international reach, enabling us to realise our strategy of delivering Asia to the world. Our immediate priority is to get the equity and investment banking divisions back in business operating under the Nomura name." The transaction is subject to a number of conditions including regulatory approvals. Nomura said the European and Asian deals exclude trading assets or trading liabilities, AP adds. About Nomura Nomura Holdings Inc. -- http://www.nomura.com/-- is a financial services group and the pre-eminent Asian-based investment bank with worldwide reach. Nomura provides a broad range of innovative solutions tailored to the specific requirements of individual, institutional, corporate and government clients through an international network in 30 countries. Based in Tokyo and with regional headquarters in Hong Kong, London, and New York, Nomura employs about 18,000 staff worldwide. Nomura's unique understanding of Asia enables the company to make a difference for clients through five business divisions: domestic retail, global markets, global investment banking, global merchant banking, and asset management. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com-- is the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Through its team of more than 25,000 employees, Lehman Brothers offers a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. The firm, through predecessor entities, was founded in 1850. Lehman filed for chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. The September 15 Chapter 11 filing by Lehman Brothers Holdings, Inc., does not include any of its subsidiaries. Subsidiary LB 745 LLC, submitted a Chapter 11 petition on September 16 (Case No. 08-13600). The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Barclays Bank Plc has agreed, subject to U.S. Court and relevant regulatory approvals, to acquire Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. These are currently the only UK incorporated companies in administration. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units of Lehman Brothers Holdings, Inc., which has filed for bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York, have combined liabilities of JPY4 trillion -- US$38 billion). Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited have suspended its operations with immediate effect, including ceasing to trade on the Hong Kong Securities Exchange and Hong Kong Futures Exchange, until further notice. The Asian units' asset management company, Lehman Brothers Asset Management Limited, will continue to operate on a business as usual basis. A further notice concerning the retail structured products issued by or arranged by any Lehman Brothers group company will be issued as soon as possible, a press statement said. LEHMAN BROTHERS: PwC Wants US$8 Billion Returned to European Arm ---------------------------------------------------------------- PricewaterhouseCoopers LLP, administrators to Lehman Brothers Holdings Inc.'s European units, pressed for the repatriation of more than US$8 billion (EUR5.5 billion, or GBP4.4 billion) transferred to the investment bank's U.S. holding company before its collapse, The Financial Times says. FT relates that the demand is likely to be applauded by Lehman's 4,500 staff in London, who have mostly expressed anger over Lehman Brothers International (Europe)'s lack of cash. PwC's Tony Lomas said that the US$8 billion transfer to New York days prior to the bankruptcy filing was suspicious, but said that he was "not ruling anything out," FT notes. Mr. Lomas told FT that the matter needs further inquiry since it involves a large sum. PwC admitted that it is common for large financial companies to have cash in regional operating units swept back to head office, FT notes. An undisclosed insider said that it was too early to tell if the transferred funds could be returned, FT relates. Another source said that the repatriation could be followed up with a formal legal action, FT reports. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com-- is the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Through its team of more than 25,000 employees, Lehman Brothers offers a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. The firm, through predecessor entities, was founded in 1850. Lehman filed for chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. The September 15 Chapter 11 filing by Lehman Brothers Holdings, Inc., does not include any of its subsidiaries. Subsidiary LB 745 LLC, submitted a Chapter 11 petition on Sept. 16, 2008 (Case No. 08-13600). The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Barclays Bank Plc has agreed, subject to U.S. Court and relevant regulatory approvals, to acquire Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. These are currently the only UK incorporated companies in administration. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units of Lehman Brothers Holdings, Inc., which has filed for bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York, have combined liabilities of JPY4 trillion -- US$38 billion). Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited have suspended its operations with immediate effect, including ceasing to trade on the Hong Kong Securities Exchange and Hong Kong Futures Exchange, until further notice. The Asian units' asset management company, Lehman Brothers Asset Management Limited, will continue to operate on a business as usual basis. A further notice concerning the retail structured products issued by or arranged by any Lehman Brothers group company will be issued as soon as possible, a press statement said. M.I.W. FABRICATIONS: Claims Filing Period Ends November 3 --------------------------------------------------------- Creditors of M.I.W. (Fabrications) ltd. have until Nov. 3, 2008, to detail their names and addresses (and solicitors if applicable) together with particulars of their debts or claims, in writing, or in person, to: Duncan R. Beat Liquidator Tenon Recovery 75 Springfield Road Chelmsford Essex CM2 6JB England Duncan R. Beat of Tenon Recovery was appointed liquidator of the company on Sept. 3, 2008, for the creditors' voluntary winding-up procedure. M.I.W. METALWORK: Claims Filing Period Ends November 3 ------------------------------------------------------ Creditors of M.I.W. (Metalwork) Ltd. have until Nov. 3, 2008, to detail their names and addresses (and solicitors if applicable) together with particulars of their debts or claims, in writing, or in person, to: Duncan R. Beat Liquidator Tenon Recovery 75 Springfield Road Chelmsford Essex CM2 6JB England Duncan R. Beat of Tenon Recovery was appointed liquidator of the company on Sept. 3, 2008, for the creditors' voluntary winding-up procedure. INEOS VINYLS: Moody's Assigns Negative Outlook to Low-B Ratings --------------------------------------------------------------- Moody's Investors Service has assigned a negative outlook to the B1 corporate family rating of Ineos Group Holdings plc, the Ba3 ratings on its existing senior first lien facilities, the B3 ratings of its second-lien facilities and the B3 ratings on its senior guaranteed notes and legacy notes at Ineos Vinyls. The rating action reflects Moody's expectation that the weak current operating trends may persist in the near future, leading to a sustained weakness in the cash flow generation of the group as the polyolefins cycle enters into a downturn. Moody's has previously indicated that a deterioration in the group's cash flow debt coverage metrics with FFO plus Interest / Interest falling below 2.0x or weakening FCF generation are likely to put negative pressure on the current ratings. Moody's is also concerned that a sustained weakness in operating cash flow generation could also constrain headroom under the group's financial covenants potentially raising liquidity concerns. Moody's nevertheless notes that Ineos's performance in the first half of 2008 was influenced by a number of one-off events, such as a strike at its Grangemouth facilities and a fire at the ethylene pipeline in Koln, and reflected some structural pressure on O&P margins in Europe that to a certain extent should be corrected during the second part of the year. Looking ahead, Moody's will focus on the ability of the group to continue to generate FCF through the trough of the cycle and proactively manage its liquidity in spite of increasingly volatile feedstock prices. Moody's notes that Ineos' liquidity position is tightly managed. At the end of June 2008, the group reported about EUR374 million in availability under its working capital facilities and EUR515 million in cash balances ahead of the interest payments in November 2008. The following ratings are affected by the rating action: Ineos Group Holdings plc: -- Corporate Family Rating: B1 -- Probability of default rating: B1 -- EUR1.750 million and US$750 million 2016 senior g-teed notes - B3 and LGD at 5 (89%); Ineos Holding Limited -- EUR4,310 million and US$1,930 million first-lien senior g-teed bank facilities - Ba3 and LGD at 3 (34%); -- EUR650 million second lien senior loans - B3 and LGD at 5 (78%); Ineos Vinyls Finance plc -- EUR160 million senior g-teed notes - B3 and LGD at 6 (96%). Ineos Group Holdings plc is a diversified and integrated chemicals group headquartered in Southampton, the United Kingdom. Ineos reported 2007 Revenues of EUR27.5 billion and EBIT of EUR1.2 billion. PERSONAL STORAGE: Taps PricewaterhouseCoopers as Liquidators ------------------------------------------------------------ Ian Christopher Oakley Smith and Michael John Andrew Jervis, of PricewaterhouseCoopers LLP were appointed joint liquidators of Personal Storage (Operations) LLP on Sept. 8, 2008, for the creditors' voluntary winding-up proceeding. The company can be reached at: Personal Storage (Operations) LLP c/o PricewaterhouseCoopers LLP Hill House Richmond Hill Bournemouth BH2 6HR England ROADCHEF FINANCE: S&P Lowers Rating on Class A2/B Notes to BB/B --------------------------------------------------------------- Standard & Poor's Ratings Services has lowered its ratings on the class A2 and B notes issued by Roadchef Finance Ltd. and removed them from CreditWatch with negative implications. At the same time, S&P removed the class A1 notes from CreditWatch positive and affirmed it. S&P placed the class A2 and B notes on CreditWatch negative on Aug. 26, 2008 following a weak performance in the third quarter of financial year 2008. To resolve the CreditWatch placements on all the notes S&P mets with senior management to discuss past performance and future strategy as well as conducted a formal review of Roadchef's operating performance. The subsequent downgrades of the A2 and B classes reflect, in S&P's opinion, the worsening of the underlying profitability of the business, difficulties generating cash flows to meet their debt service over the short term without the support of Roadchef's ultimate owner Delek Real Estate, and the continuing difficult trading conditions expected over the medium term. S&P notes however, that that management's plans to improve the estate have had a promising effect on the Strensham site, one of Roadchef's motorway stations. In addition, S&P notes that the benefits of the structural enhancements have not been as prevalent as initially expected, given that Roadchef technically remains within its covenants but under S&P's analysis presently does not generate sufficient cash flow available for debt service to meet all obligations under the securitization. Also, the cash trapping mechanism in the transaction has not had the anticipated effect of building cash reserves. The affirmation of the class A1 notes is as a result of several factors, primarily the small size of the A1 class, its impending maturity, and the availability of Delek's support as required. A full Transaction Update on Roadchef Finance Ltd. will be published shortly. Roadchef Finance Ltd.: -- GBP210 Million Secured Notes Rating Removed From CreditWatch Positive And Affirmed: Class To From ----- ---- -------------- A1 BBB+ BBB+/Watch Pos Ratings Lowered And Removed From CreditWatch Negative: Class To From ----- ---- ------------- A2 BB BBB/Watch Neg B B BB/Watch Neg SMARTIRE SYSTEMS: Patent Infringement Suit vs. Schrader Settled --------------------------------------------------------------- SmarTire Systems Inc. disclosed in a Securities and Exchange Commission filing that on Aug. 21, 2008, the company and Schrader- Bridgeport International, Inc. entered into a Confidential Settlement and License Agreement, terminating a lawsuit between the parties. On Sept. 12, 2007, that company filed a complaint against Siemens VDO Automotive Corp. and Schrader-Bridgeport in the United States District Court for the Eastern District of Virginia alleging infringement of its United States Patent No. 5,231,872, entitled "Tire Monitoring Apparatus and Method." The case was styled SmarTire Systems, Inc. v. Siemens VDO Automotive Corp., Schrader- Bridgeport International, Inc. and Schrader Electronics Ltd., Civil Action No. 1:07cv932 (E.D. Virginia). In a stipulated judgment that was entered by the district court on Aug. 26, 2008, Schrader also acknowledged the validity and enforceability of the Company's United States Patent No. 5,231,872. About SmarTire Systems Headquartered in Richmond, British Columbia, Canada, SmarTire Systems Inc. (OTC BB: SMTR) -- http://smartire.com/-- develops, subcontracts its manufacturing, and markets tire pressure monitoring systems (TPMSs), which monitor tire pressure and tire temperature in a range of vehicles. The company sells TPMSs for trucks, buses, recreational vehicles, passenger cars and motorcycles. It has three wholly owned subsidiaries: SmarTire Technologies Inc., SmarTire USA Inc. and SmarTire Europe Limited. In Europe, SmarTire is headquartered in Oxfordshire, United Kingdom. SmarTire Systems Inc.'s consolidated balance sheet at April 30, 2008, showed US$3,240,386 in total assets, US$38,162,990 in total liabilities, and US$3,565,585 in preferred shares, resulting in a US$38,488,189 stockholders' deficit. Going Concern Doubt BDO Dunwoody LLP, in Vancouver, Canada, expressed substantial doubt about SmarTire Systems Inc.'s ability to continue as a going concern after auditing the company's consolidated financial statements for the years ended July 31, 2007, and 2006. The auditing firm pointed to the company's accumulated deficit and working capital deficiency. The company has incurred recurring operating losses and as of April 30, 2008, had an accumulated deficit of US$146,822,824 and a working capital deficiency of US$33,864,927 of which US$33,739,519 is potentially convertible into shares of common stock of the company, subject to certain restrictions. TERRAPIN TECHNICAL: Claims Filing Period Ends October 16 -------------------------------------------------------- Creditors of Terrapin Technical Services Ltd. have until Oct. 16, 2008, to send their names and addresses and particulars of their claims to: David Antony Willis and Matthew Colin Bowker Joint Liquidators Tenon Recovery The Exchange Station Parade Harrogate HG1 1TS England David Antony Willis and Matthew Colin Bowker of Tenon Recovery were appointed joint liquidators of the company on Sept. 8, 2008, for the creditors' voluntary winding-up proceeding. * BRITAIN: FTSE 100 Index Soars 6% on U.S. Talks of Rescue Plan --------------------------------------------------------------- A meeting among U.S. Treasury Secretary Hank Paulson, Federal Reserve Chairman Ben Bernanke, and top lawmakers last week spurred stock prices worldwide, The Financial Times reports. The meeting was intended to discuss the creation of a giant U.S. government- sponsored vehicle to take on toxic assets in the financial system, FT says. In Europe, FT relates that the British provider of stock indices FTSE 100 surged last Thursday by more than 6% as financial stocks were also helped by the financial regulator's ban on short selling. In Europe, benchmark indices also soared. The CAC-40 in Paris jumped more than 5% and Germany's Dax rose almost 4% as financial stocks rallied on hopes an end to the crisis was approaching, FT reports. Asian markets were also higher, according to the report. Japan's Nikkei 225 rose nearly 4% and China's Hang Seng surged 9% in late trading. The Federal Reserve gave central banks in Japan, the eurozone, the UK, Switzerland and Canada US$180 billion to lend on to local banks that cannot access its onshore dollar lending facilities, FT notes. The central banks, in turn, promised to take "appropriate steps to address the ongoing problems," FT says. An agreement under the rescue plan modeled on the Resolution Trust Corporation, however, has to pass Congress, FT reports. Democratic senator Charles Schumer criticized the agreement saying the RTC was not the right model for dealing with the crisis, FT reports. * BRITAIN: Finance Workforce to Shrink by 2% by 2009, Poll Says --------------------------------------------------------------- Britain will shed around 110,000 jobs in financial and business services in the year to next April, with the newly unemployed set for a tough search in an increasingly skewed job market, Reuters reports. Senior executives told pollsters commissioned by Hay Group management consultants they expected their workforce to shrink by almost 2% on average in 2008 to 2009, the report says. The poll was carried out in June, a time when the credit crunch had already made executives pessimistic over the jobs outlook, Reuters notes. The financial headcount in Britain will not return to current levels until 2010 to 2011, the survey cited by Reuters showed. Hay Group polled 40 financial services executives out of a total 120 executives in the survey. The figures were released after Lehman Brothers Holdings Inc. filed for bankruptcy and Bank of America's acquisition of Merrill Lynch that would likely result in the reduction of 24,000 workers worldwide, Reuters reports. "The war for talent is effectively over" and there will be more job seekers than jobs, Reuters quotes financial recruiter Robert Thesiger as saying. In August, new financial job vacancies in London fell 34% year-on- year, in line with a 37% decline in the number of candidates, Reuters relates, citing Morgan McKinley headhunters headed by Mr. Thesiger. * EUROPE: Banks and Insurers See US$7.3B Losses Tied to Lehman -------------------------------------------------------------- Bloomberg News says European banks and insurers disclosed potential losses of about US$7.3 billion tied to the collapse of Lehman Brothers. Bloomberg provided a table showing the bank's exposures: Firm Potential Exposure Details Name (US$ Millions) ---- ------------------ ------- Aegon NV <378 fixed income Allianz SE 568 investment losses AZA SA 426 credit risk Aviva Plc 481 debt risk Banca Popolare <14 securities, di Milano Scrl counterparty risk BNP Paribas SA 564 derivative claims, bank loan, credit Credit Agricole SA 385 credit, counterparty risk Dexia 507 senior bonds Fortis 195 bonds Friends Provident Plc 32 senior debt Hannover RE 33 bonds, shares ING Groep NV 285 loan, bond exposure Intesa Sanpaolo SpA 370 loans, bonds KBC Group NV 399 bonds, loans KfW Group "mid three-digit securities, foreign million euros" exchange swaps Lloyds TSB 75 letter of credit Group Plc Munich Re 499 investments, counterparty deals, derivatives Natixis SA 535 off-balance sheet instruments, swaps, collateralized loans of securities Old Mutual Plc 56 debt, derivatives Societe Generale SA 678 market activities, senior debt Scor SE 50 senior notes Svenska 91 letters of credit, Handelsbanken AB securities lending, derivatives Swedbank AB 30 derivatives, bonds Swiss Life Holding 18 corporate bonds Swiss Reinsurance Co. 45 investments, net purchases of credit default swaps, and other counterparty Unione di Banche 37 bonds, loans, Italiane Scpa derivatives UBS AG <300 direct and counterparty Zurich Financial 250 senior unsecured Services AG Dexia Sees EUR350 Mil. Lehman-Related Losses Dexia SA expects its Lehman-related losses to be around EUR350 million, resulting from: -- Risk Exposure on Lehman: a. EUR500 million senior bond exposure on Lehman Brothers Holdings Inc., with final economic loss depending on Lehman's liquidating conditions (this amount includes the only direct bond exposure of FSA, Dexia's credit enhancement subsidiary, of US$6.5 million in its investment portfolio). b. No bank loans or letters of credit on Lehman Brothers Group. -- Unwinding of collateralized transactions: a. Repo arrangements with Lehman, over-collateralized with good-quality underlying assets, have been unwound and Dexia has therefore no residual exposure on Lehman. Dexia expects to realize no, or no material, losses as a result of liquidating its positions. b. Dexia holds a portfolio of good-quality assets (super- AAA) as part of a transaction where Lehman had provided protection backed by cash collateral deposited with Dexia (Negative Basis Trade). Dexia says the unwinding of this trade is expected to result in no, or no material, losses for the company. c. The replacement value of derivative contracts entered into with Lehman is estimated to be about EUR40 million to EUR60 million. Dexia SA, formerly Artesia Banking Corporation SA, -- http://www.dexia.com/-- is a Belgian bank specialized in retail banking and local public finance. The Bank offers a range of banking services for individual customers, small and medium-sized enterprises and institutional clients. It has four divisions: Asset Management, Personal Financial Services, Treasury and Financial Markets, and Investor Services. Through its subsidiaries, Dexia SA is active in over 30 countries, including Belgium, Luxembourg, Slovakia, Turkey, Australia and Japan. * EUROPE: Spreads on Credit Default Swaps Hit Stressed Levels ------------------------------------------------------------- Financial institutions like Goldman Sachs and Morgan Stanley in the U.S. and HBOS in Europe saw spreads on credit default swaps hit stressed levels last week, The Financial Times reports. Spreads on credit default swaps, which provide a kind of insurance against non-payment of debt, set fresh records Sept. 16 putting banks and insurers at the center of the turmoil, FT says. FT observes that the collapse of Lehman Brothers has undermined the "too-big-to-fail" concept. FT recalls the Federal Reserve's rescue of Bear Stearns in March 2008. The report also notes American International Group's looming default, which is expected to have massive knock-on effects on financial institutions. Markit Group, which runs the U.S. CDX indices, saw enough indicative quotes to provide intra-day spreads from about 6:30 a.m., on Sept. 16, according to the report. The spread was 23 basis points greater at 217.5bp, surpassing the record levels hit ahead of the Bear rescue. By lunchtime, when hopes were raised for an AIG bail-out, the index had tightened back to 201bp, FT relates. The index means that it costs US$201,000 annually to insure US$10 million of corporate debt in the index over five years. In Europe the iTraxx Crossover list of junk-rated names matched mid-March highs of 640bp, having opened at about 600bp and went up to 624bp by the end of the day, FT reports. Based on the report, the main iTraxx Europe index of investment-grade corporate debt was quoted as wide as 156bp. Goldman Sachs CDS hit 570bp and Morgan Stanley hit 841bp, FT notes. Bears Stearns CDS spreads closed at a record wide of 737bp on March 14 before the JPMorgan takeover, FT reckons. In Europe, HBOS saw the biggest move in the index, mimicking the drop in its share price, the report says. Its cost of protection soared to more than 500bp having closed at 311bp. Early last week, the Markit Group said dealers decided to delay the upcoming six-monthly index changes by one week, FT notes. The delay illustrated the extent of the volatility and trading chaos in the markets, FT says. However, the report says that traders felt the system was holding up well under the pressure and liquidity is strong, particularly compared with last summer when the crunch first hit. This is partly because banks are now generally holding less risk, FT reports, citing Nishul Saperia of Markit Group. * UK Retail Sales Volume Rise 1.2% in August, ONS Survey Says ------------------------------------------------------------- Moderate underlying growth in retail sales volume continues, driven by strength in clothing and footwear stores, according to data from the Office of National Statistics. Between August and July, total sales volume rose by 1.2 per cent. The overall monthly growth was driven by textile, clothing and footwear stores where sales rose by 4.1 per cent. Sales volume in predominantly food stores fell by 0.2 per cent. Sales volume for predominantly non-food stores rose by 2.1 per cent. Sales volume for the non-store retailing and repair sector rose by 2.4 per cent. Sales volume in the three months June to August fell by 0.8 per cent compared with the previous three months. However, on this occasion ONS advises caution in the interpretation of this measure, because of the record increase in the May 2008 index, which significantly affects this estimate this month. Supplementary analysis provided with this release provides more information on the recent trend in underlying sales volume. Total sales volume in the three months to August was 2.5 per cent higher than the same period a year ago. Sales for predominantly food stores rose by 0.6 per cent. Sales volume for predominantly non-food stores rose by 2.9 per cent. Sales for the non-store retailing and repair sector increased by 11.0 per cent. The non-seasonally adjusted value of retail sales for the three months to August was 3.7 per cent higher than in the same period a year earlier. The average weekly value of sales in August was GBP5.1 billion, 3.9 per cent higher than in August 2007. Sales by predominantly food stores rose by 5.5 per cent over the year. In the predominantly non-food stores sales rose by 2.2 per cent. Within the non-store retailing and repair sector sales increased by 6.5 per cent. The Office for National Statistics is the executive office of the UK Statistics Authority, a non-ministerial department which reports directly to Parliament. ONS is the UK Government's single largest statistical producer. * Fitch Says Default in Loans Securing European CMBS is Mounting ---------------------------------------------------------------- Fitch Ratings says in a report that the number of loans securing European commercial mortgage-backed securities in default is rising. Although the majority of recent rating actions have been affirmations, there were 31 downgrades between Jan. 1, 2008 and Sept. 1, 2008, compared to only 10 downgrades throughout 2007. Currently, there are 42 tranches on Rating Watch Negative; 23 of which were caused by underperformance of the underlying loans and 19 due to downgrades of, or RWN on, transaction counterparties such as hedge providers (Lehman Brothers) and sole tenants (HBOS). "The number of individual cases of loan problems is limited, but has risen significantly in recent months," comments Mario Schmidt, Associate Director in Fitch's European CMBS group. "Loan and inter-creditor agreements are going to be tested for the first time as loans have entered special servicing and their security may be enforced. In addition, valuers of commercial real estate will find their work put to the test in forced or private sales, which may explain a certain degree of conservatism of valuers when conducting updated valuations for assets securing distressed loans," adds Mr. Schmidt. * Fitch Puts 18 Tranches in Six European CMBS Under Negative Watch ------------------------------------------------------------------ Fitch Ratings has placed 18 tranches in 6 European CMBS transactions on Rating Watch Negative, following this week's downgrade of Lehman Brothers Holdings Inc. to 'D'. Subsidiaries of LBHI act as hedge counterparties in various Fitch-rated European CMBS transactions as detailed in Fitch's comment of Sept. 16, 'Fitch Assessing Lehman Counterparty Exposure in 9 European CMBS Transactions'. This action reflects the risk that LBHI's subsidiaries will be unable to meet their obligations under various hedge contracts, leaving the issuers with increased exposure to risks related to interest rates and, for one issuer, also currency exchange. The issuers listed below had benefited from the terms of the relevant hedge contracts; consequently, removal of this benefit would place a strain on their ability to meet obligations under the referenced notes. The magnitude of this effect will differ between issuers, depending on various factors such as the availability of excess spread, the remaining life of the notes, the timing of any action and the terms of the existing hedging contracts. Fitch has taken these factors into consideration in identifying the tranches that could be affected as a result of the bankruptcy of LBHI. These tranches have been placed on RWN: Paris Prime Commercial Real Estate FCC -- EUR33.6 million Class C (FR0010382325) due 2014 rated 'A' placed on RWN -- EUR31.5 million Class D (FR0010382333) due 2014 rated 'BBB' placed on RWN -- EUR8.8 million Class E (FR0010382341) due 2014 rated 'BBB-' placed on RWN Windermere VIII CMBS Plc -- GBP49.8 million Class B (XS0261299746) due 2015 rated 'AA' placed on RWN -- GBP50.2 million Class C (XS0261300692) due 2015 rated 'A' placed on RWN -- GBP43.7 million Class D (XS0261300932) due 2015 rated 'BBB' placed on RWN -- GBP19.7 million Class E (XS0261301310) due 2015 rated 'BB' placed on RWN Windermere IX CMBS (Multifamily) -- EUR121.3 million Class C (XS0275108099) due 2016 rated 'A' placed on RWN Windermere X CMBS Ltd -- EUR109.2 million Class D (XS0293898457) due 2019 rated 'A' placed on RWN -- EUR7.7 million Class E (XS0293898887) due 2019 rated 'BBB' placed on RWN -- EUR14.0 million Class F (XS0293899265) due 2019 rated 'BB' placed on RWN Windermere XI CMBS Plc -- GBP41.8 million Class C (XS0311592538) due 2017 rated 'A' placed on RWN -- GBP31.4 million Class D (XS0311592967) due 2017 rated 'BBB' placed on RWN -- GBP7.5 million Class E (XS0311590839) due 2017 rated 'BB' placed on RWN Windermere XIV CMBS Ltd -- EUR75.7 million Class C (XS0330752949) due 2018 rated 'A' placed on RWN -- EUR32.0 million Class D (XS0330753244) due 2018 rated 'A' placed on RWN -- EUR42.6 million Class E (XS0330753590) due 2018 rated 'BBB' placed on RWN -- EUR20.7 million Class F (XS0330753673) due 2018 rated 'BBB' placed on RWN The LBHI subsidiaries also act as counterparties to certain underlying borrowers within European CMBS transactions. Although borrower-level hedge terminations may depress debt service coverage ratios, this is unlikely to have a significant impact on the key determinant of credit quality, balloon repayment risk. Fitch intends to update the RWN actions as more information surrounding events at LBHI and its subsidiaries becomes available, and as the status of the issuers' hedging arrangements evolves. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than US$3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/booksto order any title today. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter -- Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Zora Jayda Zerrudo Sala, Pius Xerxes Tovilla, Joy Agravante, Melanie Pador, Marie Therese V. Profetana and Peter A. Chapman, Editors. Copyright 2008. 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$625 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 Christopher Beard at 240/629-3300. * * * End of Transmission * * *