/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/130624.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 Monday, June 24, 2013, Vol. 14, No. 123 Headlines B E L A R U S * Moody's Affirms Deposit Ratings of Five Belarusian Banks B U L G A R I A CSKA SOFIA: Declares Insolvency; Seeks Merger with Another Club G E R M A N Y BRENNTAG AG: Moody's Affirms 'Ba1' Corp. Rating; Outlook Positive CART 1: S&P Downgrades Rating on Class D Notes to 'CCC' G R E E C E FREESEAS INC: Receives Non-Compliance Notice From NASDAQ * Moody's Notes Worsening Greek RMBS Performance in May 2013 I T A L Y A-LEASING SPA: Moody's Lowers Rating on EUR29.85MM C Notes to B1 BANCA MONTE: Fitch Affirms 'CC' Preferred Stock Rating R U S S I A IBA-MOSCOW: Fitch Assigns 'BB' Rating to RUB3-Bil. Bond Issue TATNEFT OAO: Fitch Affirms 'BB+' Long-Term Issuer Default Rating * KRASNOYARSK REGION: Fitch Affirms 'BB+' LT Currency Ratings * Fiscal Pressures Unlikely to Affect Ratings for Russian Regions S P A I N BBVA EMPRESAS 6: Moody's Confirms B3 Rating on EUR156MM C Notes CASER SA: Moody's Cuts Insurance Financial Strength Rating to B1 CODERE SA: Creditors Agree to Extend Financing thru June 28 FTA SANTANDER 2007-1: Fitch Cuts Rating on Class D Notes to 'D' TDA CAM 10: S&P Lowers Ratings on Three Note Classes to 'BB+' S W E D E N NORTHLAND RESOURCES: Distributes Reorganization Plan to Creditors SAAB AUTOMOBILE: Spyker Mulls New Court Action v. GM Over Sale U K R A I N E METINVEST BV: Fitch Affirms 'B' Long-Term Foreign Currency IDR U N I T E D K I N G D O M CO-OPERATIVE BANK: Unlikely to Claw Back Money From Former Head CO-OPERATIVE BANK: Fitch Cuts LT Issuer Default Rating to 'BB-' CO-OPERATIVE BANK: DBRS Cuts Subordinated Debt Rating to 'CC' COGGLES: Hut Group Buys Firm Out of Administration COUNTYROUTE PLC: S&P Affirms 'B+' Sr. Secured Bank Loan Rating DUNFERMLINE FC: Preferred Bidder to Be Identified This Week EQUIDEBT: In Administration, Cuts 60 Jobs HEARTS FC: Morisons And HBJ Gateley Lead Advice On Administration NEW LOOK: Fitch Assigns 'B' Rating to GBP808MM Sr. Secured Notes RBS CAPITAL: S&P Raises Rating on 3 Hybrid Instruments to 'BB+' ROWERECORD ENGINEERING: Creditors Set to Lose GBP15 Million VICTORY CHRISTIAN: Heads Into Receivership, Owes EUR18 Million X X X X X X X X * Euro-Zone Finance Ministers Agree on Bailout Fund Guidelines * BOND PRICING: For the Week June 17 to June 21, 2013 ********* ============= B E L A R U S ============= * Moody's Affirms Deposit Ratings of Five Belarusian Banks ---------------------------------------------------------- Moody's Investors Service has affirmed the deposits ratings of five Belarusian banks: Belarusbank, Minsk Transit Bank, BPS- Sberbank, Belinvestbank, and Belagroprombank. These banks' long- term deposit ratings carry a negative outlook. The affirmation of Belarusian banks' deposit ratings follows Moody's affirmation of the B3 local-currency government bond rating of Belarus as well as the B3 foreign-currency bond ceiling and the Caa1 foreign-currency bank deposit ceiling on June 14, 2013. Concurrently, Moody's has also affirmed the standalone bank financial strength ratings (BFSRs) of Belarusbank, Minsk Transit Bank, BPS-Sberbank, Belinvestbank, and downgraded Belagroprombank's BFSR to E, equivalent to a baseline credit assessment of caa1, from E+/b3. Ratings Rationale: These deposit rating affirmations, with negative outlooks, reflect Moody's view that the current ratings sufficiently capture the Belarusian banks' high vulnerability to the elevated risks associated with their exposure to government debt and the national economy. In Moody's opinion, the Belarusian economy faces significant macroeconomic risks that could constrain economic growth and destabilize government finances, with adverse consequences for banks' credit profiles. Moody's expects that the banks' asset quality will deteriorate given (1) weaker exports and domestic economic activity, which will negatively affect borrowers' credit standing; and (2) lower subsidies to borrowers from the government, especially if economic imbalances grow and external financing conditions tighten. Despite no immediate liquidity concerns for Belarusian banks, their liquidity remains vulnerable due to a high share of long- term investment loans funded with short-term deposits. The banks' local-currency needs are typically addressed by borrowings from the National Bank of Belarus and from other banks. However, Moody's says that the banks' foreign-currency liquidity positions are fragile, given the low level of FX liquid assets and because depositor confidence in Belarus remains low, which continues to pose the risk of deposit withdrawals. The negative outlook on the banks' deposit ratings and standalone BFSRs of Belarusbank, Minsk Transit Bank and BPS-Sberbank reflects these challenges. Affirmation of standalone BFSRs of Belarusbank, BPS-Sberbank, Minsk Transit Bank and Belinvestbank The affirmation of the standalone BFSRs of Belarusbank, BPS- Sberbank, Belinvestbank and Minsk Transit Bank, reflects Moody's view that these ratings sufficiently capture the main credit weaknesses of these institutions, including: (1) the high sensitivity of their financial fundamentals to the continuing vulnerability of the Belarus economy; (2) deficiencies in their corporate governance practices; and (3) potentially vulnerable asset quality and liquidity positions. At the same time, for Belarusbank, BPS-Sberbank and Belinvestbank, their BFSRs are supported by their market positions and ongoing funding and/or capital governmental/parental support. For Minsk Transit Bank, its BFSR is supported by its stronger liquidity profile and profitability, relative to its peers. Downgrade of Belagroprombank's Standalone BFSR The lowering of Belagroprombank's standalone credit strength to E/caa1 is driven by the bank's more vulnerable asset quality, relative to its Belarusian peers. Over 60% of Belagroprombank's loans are granted to the higher-risk agriculture sector or to the companies related to agriculture. At the same time, Belagroprombank's B3 long-term local-currency deposit rating continues to incorporate a very high probability of systemic support which results in one notch of uplift from the bank's BCA of caa1. This support assumption takes into account the bank's important role in the local banking system. Bank ratings affected by the rating action: Belarusbank: - Long-term local-currency deposit rating affirmed at B3 - Long-term foreign-currency deposit rating affirmed at Caa1 - Short-term foreign and local-currency deposit ratings affirmed at Not Prime - BFSR affirmed at E+ All long-term ratings and the BFSR carry a negative outlook. Belagroprombank: - Long-term local-currency deposit rating affirmed at B3 - Long-term foreign-currency deposit rating affirmed at Caa1 - Short-term foreign and local-currency deposit ratings affirmed at Not Prime - BFSR downgraded to E BFSR carries a stable outlook. All long-term ratings carry a negative outlook. Belinvestbank: - Long-term local-currency deposit rating affirmed at B3 - Long-term foreign-currency deposit rating affirmed at Caa1 - Short-term foreign and local-currency deposit ratings affirmed at Not Prime - BFSR affirmed at E BFSR carries a stable outlook. All long-term ratings carry a negative outlook. BPS-Sberbank: - Long-term local-currency deposit rating affirmed at B1 - Long-term foreign-currency deposit rating affirmed at Caa1 - Short-term foreign and local-currency deposit ratings affirmed at Not Prime - BFSR affirmed at E+ All long-term ratings and the BFSR carry a negative outlook. Minsk Transit Bank: - Long-term local-currency deposit rating affirmed at B3 - Long-term foreign-currency deposit rating affirmed at Caa1 - Short-term foreign and local-currency deposit ratings affirmed at Not Prime - BFSR affirmed at E+ All long-term ratings and the BFSR carry a negative outlook. Principal Methodologies The principal methodology used in these ratings was Global Banks published in May 2013. All banks affected by the review are headquartered in Minsk, Belarus: - Belarusbank reported audited total (IFRS) assets of $13.5 billion as of end-December 2012. - Belagroprombank reported audited total (IFRS) assets of $6.6 billion as of end-December 2012. - BPS-Sberbank reported audited total (IFRS) assets of $3.7 billion as of end-December 2012. - Belinvestbank reported audited total (IFRS) assets of $2.1 billion as of end-December 2012. - Minsk Transit bank reported audited total (IFRS) assets of $381.8 million as of end-December 2012. =============== B U L G A R I A =============== CSKA SOFIA: Declares Insolvency; Seeks Merger with Another Club --------------------------------------------------------------- Angel Krasimirov at Reuters reports that CSKA Sofia declared bankruptcy on Saturday and will seek a merger with another club to play in the top flight next season. "CSKA that we know exists no more," Reuters quotes CSKA coach Hristo Stoichkov as saying at a news conference. "We'll start afresh, without debts." "CSKA must now find another team with which to merge in order to use their license and remain in Bulgaria's first division." Mr. Stoichkov, as cited by Reuters, said CSKA will not play in next season's Europa League despite qualifying for the competition by finishing third in the domestic table. Speculation has been rife in local media that CSKA and four-times champions Litex Lovech could merge to save costs with the two clubs having discussed the possibility in January, Reuters discloses. However, CSKA will play in the amateur championship next season if they fail to merge with another first division club in time for the start of the Bulgarian league on July 20, Reuters notes. The 31-times Bulgarian champions said in a statement that the club has transferred their 6.5 million shares to Mr. Stoichkov, Reuters relates. "After talks with Hristo Stoichkov, we took a common decision to transfer him all the club's shares," Reuters quotes Dimitar Borisov, one of the club's owners, as saying. "We, as owners have absolutely no financial claims." "As responsible people, we decided that Hristo Stoichkov will take the decisions about the future of the club. We took these actions because of the grave financial situation of CSKA and our inability to support the club." CSKA have been struggling financially in recent years and have just escaped a European ban by Europe's football governing body UEFA over debts in the last two seasons, Reuters recounts. The Reds were barred from the Champions League in 2008-09 after failing to meet the licensing criteria, Reuters relates. CSKA Sofia is a Bulgarian football club. ============= G E R M A N Y ============= BRENNTAG AG: Moody's Affirms 'Ba1' Corp. Rating; Outlook Positive ----------------------------------------------------------------- Moody's Investors Service has changed to positive from stable the outlook on all the ratings of Brenntag AG. The rating agency also affirmed the Ba1 corporate family rating (CFR) and Ba1-PD probability of default rating of the company. Concurrently, Moody's has affirmed the Ba1 rating, with a loss given default (LGD) assessment of LGD4 (50%), on the company's senior unsecured guaranteed notes maturing in 2018. "Our positive outlook on Brenntag's Ba1 ratings recognizes the ability of Brenntag to maintain a stable financial performance even under persisting weak general economic conditions in its reference European markets, given its large scale and the breadth of its geographic and product diversification, which underpin its strong business profile," says Gianmarco Migliavacca, a Moody's Vice President - Senior Analyst and lead analyst for Brenntag. "The change in outlook also acknowledges the progress made by the company in improving its credit metrics, and our expectation of its ability to gradually achieve further improvements over time." Ratings Rationale: The rating action reflects Moody's expectation that Brenntag will, over time, be able to further improve its credit metrics, which have remained broadly stable over the last 12 months and already slightly improved compared to 2011 levels. In 2013, Moody's expects that Brenntag will achieve low single-digit revenue and EBITDA growth, mainly due to the expected full-year positive impact of a number of small bolt-on acquisitions completed in the second half of 2012 and early 2013. The rating agency expects that this should offset the anticipated flat or slightly negative organic growth in Brenntag's operations over the coming quarters, particularly in Europe, which accounts for nearly 47% of its consolidated revenues. Furthermore, the outlook reflects Moody's expectation that the company will remain committed to a prudent financial policy and conservatively funded acquisition strategy. The rating agency expects that Brenntag will continue to target small bolt-on acquisitions that would be relatively easy to integrate within its existing network and provide the company with further geographic and product diversification opportunities. Brenntag's ratings also positively reflect its (1) large scale as a leading global chemical distributor; (2) its strong business profile, characterized by material product and geographic diversification, further enhanced by recent acquisitions; and (3) the stability of its operating profitability over time, which reflects the nature of an asset-light distribution business model characterized by a structurally low fixed-cost base and high inventory turnover. These factors mitigate the low operating margins Brenntag is displaying, which are typical for the distribution industry. Liquidity As of March 2013, Brenntag's good liquidity position was supported by cash balances of EUR353 million and the company's EUR500 million committed revolving credit facility (which is virtually unused and remains available until July 2016). These resources, together with the stable and positive funds from operations that Moody's anticipates Brenntag will generate over the next 12-18 months, should be more than adequate to cover the company's main cash outflows. These outflows are represented by dividends (approximately EUR127 million in Q2 2013), modest maintenance capex in the region of EUR80-90 million per annum, temporary working capital outflows, as well as modest scheduled debt repayments in 2013. Brenntag's main single cash outflow in 2014 is related to the repayment of its EUR220 million securitization facility due June 2014, under which nearly EUR180 million is currently drawn. However, Moody's anticipates that the company will proactively manage this upcoming maturity in order to retain substantial headroom to accommodate other likely cash outflows related to the funding of small bolt-on acquisitions. What Could Change The Rating Up/Down Upward pressure could be exerted on Brenntag's rating if the company were to continue to improve its leverage profile and operate with a ratio of gross debt/EBITDA (as adjusted by Moody's) that is sustainably below 3.0x, whilst increasing its retained cash flow (RCF)/debt (as adjusted by Moody's) sustainably above 20%. Moreover, to achieve a rating upgrade, management would need to evidence a prudent financial policy characterized by moderate size acquisitions with limited recourse to additional debt. Conversely, negative pressure could be exerted on the rating if the group's gross debt/EBITDA ratio were to increase, and remain, above 4.0x and its RCF/debt ratio were to fall below 15%. Any deviation from the announced acquisition policy -- particularly with regard to the avoidance of transformative debt-funded acquisitions -- could also exert downward pressure on the rating. The principal methodology used in these ratings was the Global Distribution & Supply Chain Services published in November 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Brenntag is the world's largest independent chemical distributor, with 2012 revenues of EUR9.7 billion. The group has market- leading positions in Europe and in Latin America, a strong presence in North America, where it ranks as the number three player, and a meaningful presence in the highly fragmented Asia- Pacific region. Brenntag, a former division of Stinnes AG, a German logistics group, was sold to funds advised by Bain Capital in an LBO in 2004, and in September 2006 to funds advised by BC Partners in a secondary LBO. Following the IPO in 2010 on the Frankfurt Stock Exchange, the private equity funds gradually exited, and in 2012 the free float of the group became 100%. CART 1: S&P Downgrades Rating on Class D Notes to 'CCC' ------------------------------------------------------- Standard & Poor's Ratings Services has lowered and removed from CreditWatch negative its credit ratings on CART 1 Ltd.'s class A+, A, B, C, and D notes. At the same time, S&P has affirmed its rating on the class E notes. The rating actions follow the application of S&P's updated criteria for European collateralized loan obligations (CLOs) backed by small and midsize enterprises (SMEs), which S&P has used as a starting point to perform its credit analysis. S&P has also assessed the transaction's performance using the March 2013 and May 2013 investor reports and portfolio data from the servicer. On Jan. 17, 2013, when S&P's updated European SME CLO criteria became effective, it placed on CreditWatch negative its ratings on the class A+, A, B, C, and D notes. PERFORMANCE OVERVIEW Since S&P's Nov. 4, 2011 review, the portfolio has continued to replenish, in line with the conditions set out in the transaction documents. Total replenishments since closing amount to EUR4.4 billion. The reference portfolio may replenish until June 2014. The cumulative defaulted notional amount (defaults being defined in the transaction documents as bankruptcy or failure to pay for 90 days or more), including interest, has risen to EUR122.2 million from EUR94.4 million at S&P's last review. Taking into account replenishments, cumulative defaults equal about 2% of the initial and replenished portfolio amount. At the same time, the aggregate amount of outstanding defaulted loans, which includes defaulted interest amounts, equals EUR43.9 million (2.58% of the initial pool balance) compared with EUR34.6 million at S&P's last review. Furthermore, following the liquidation of two additional defaulted obligations, the issuer has allocated further losses to the unrated class F notes, which act as a first-loss piece (the class with the lowest payment priority in the structure). The class F notes' allocable losses are EUR49.35 million, compared with EUR33.63 million at S&P's last review. As a result, the available credit enhancement for the rated notes has decreased compared with S&P's last review. From the information provided to S&P by the servicer, it sees that liquidation has occurred up to about two years after credit events. S&P anticipates that the issuer will allocate further losses to the class F notes on future interest payment dates as more defaulted loans complete their workout procedures. In S&P's analysis, ir took this expected loss allocation into account by decreasing its credit enhancement assumptions. Credit Enhancement Class Credit enhancement (%) A+ 10.2 A 9.7 B 6.6 C 5.5 D 3.1 E 0.2 In addition to the reference obligations currently undergoing workout, the originator classifies EUR36.84 million, representing 2.24% of the total reference pool, as defaulted. To date, these reference obligations have not triggered a credit event (default) under the transaction documents. However, S&P believes they risk triggering further credit events and incurring losses for the transaction. Therefore, S&P has considered them as defaulted in its analysis. The transaction has comparatively high obligor group concentrations. Concentration levels have remained largely unchanged since S&P's last review with the top obligor group accounting for about 3.6% of the portfolio balance, while the largest 10 obligor groups account for about 21.7%. S&P notes that the transaction complies with the various obligor group concentration limitations as set out in the transaction documents at closing. CREDIT ANALYSIS As a result of the portfolio's comparatively high obligor group concentration levels, S&P has determined the portfolio's scenario default rates (SDRs) at all rating levels using its CDO Evaluator model. S&P based its SDR calculations on a weighted-average life of 1.7 years, and a target portfolio rating of 'bb', which S&P derived from three factors: -- A weighted-average Banking Industry Country Risk Assessment (BICRA) score, calculated using the BICRA of each of the countries present in the portfolio; -- The five-year average observed default frequency of the originator's overall loan book; and -- The transaction portfolio's credit quality, considering the credit quality of the originator's overall loan book. To derive S&P's loan-level rating inputs for its CDO Evaluator model, it mapped--to a Standard & Poor's rating--the originator's internal performing credit scores assigned to the various obligors in the transaction's portfolio. S&P did this to ensure that the portfolio's weighted-average rating equals the portfolio's target 'bb' rating. Rating level Scenario default rate (%) BBB 13.9 BBB- 12.5 BB- 10.0 B- 7.8 CCC 6.7 CCC- 6.2 RECOVERY RATE ANALYSIS At each liability rating level, S&P assumed a weighted-average recovery rate (WARR) by considering the asset type, its seniority, and the country recovery grouping. The portfolio includes both senior-secured and senior-unsecured reference obligations. Losses on defaulted reference obligations include foregone interest, which is capped at 9.3% of the amount of reference obligation liquidations. S&P has taken these factors into account in its analysis and has consequently determined its recovery assumptions for the transaction at various rating scenarios to be: Rating level Recovery assumptions (%) BBB 26.3 BB 32.4 B/CCC 35.1 S&P applied the recovery rates to the SDRs at each rating level to calculate the scenario loss rates (SLR = SDR x [1 - recovery rate]). RATING-SPECIFIC SCENARIO LOSS RATES Assigned rating Scenario loss rates (%) BBB 10.2 BBB- 9.2 BB- 6.8 B- 5.1 CCC 4.3 CCC- 4.1 SUPPLEMENTAL TESTS S&P applied the largest obligor default test to the class A+, A, B, C, D, and E notes. The application of the largest obligor test did not constrain S&P's ratings on the class A+, A, B, C, D and E notes. The class A+ and A notes' credit enhancement is commensurate with 'BBB (sf)' and 'BBB- (sf)' ratings, respectively. S&P has therefore lowered to 'BBB (sf)' from 'A+ (sf)' and removed from CreditWatch negative its rating on the class A+ notes. At the same time, S&P has lowered to 'BBB- (sf)' from 'A+ (sf)' and removed from CreditWatch negative its rating on the class A notes. According to S&P's analysis, the available credit enhancement for the class B notes, taking into consideration the sensitivity of this class to a marginal increase in its recovery rate assumption, is sufficient in its view to support a 'BB- (sf)' rating. S&P has therefore lowered to 'BB- (sf)' from 'BBB (sf)' and removed from CreditWatch negative its rating on the class B notes. According to S&P's analysis, the class C notes' available credit enhancement, is commensurate with a 'B- (sf)' rating. S&P has therefore lowered to 'B- (sf)' from 'BB+ (sf)' and removed from CreditWatch negative its rating on the class C notes. The class D notes' available credit enhancement is sufficient to sustain the default of the largest obligor group in the portfolio. However, it is not sufficient to maintain its current rating, when compared with the calculated default rate. S&P has therefore lowered to 'CCC (sf)' from 'B+ (sf)' and removed from CreditWatch negative S&P's rating on the class D notes. The class E notes' available credit enhancement remains sufficient to support its current rating, in S&P's view. S&P has therefore affirmed its 'CCC- (sf)' rating on the class E notes. S&P has not subjected the transaction to its largest industry and region default tests as none of the ratings on the notes fall into a 'AAA' or 'AA' rating category. CART 1 is a balance-sheet synthetic collateralized debt obligation transaction that closed in June 2007. The reference portfolio includes loans, revolving credit facilities, and other claims that Deutsche Bank AG or any of its subsidiaries or affiliates originated and granted to predominately German SMEs and larger companies. Subordination is the only source of credit enhancement for the rated notes, which redeem sequentially, starting with a reduction of the unfunded senior portion. Realized losses are allocated to the notes in reverse order of seniority, starting with the unrated class F notes. STANDARD & POOR'S 17G-7 DISCLOSURE REPORT SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this credit rating report is available at: http://standardandpoorsdisclosure-17g7.com RATINGS LIST Class Rating To From CART 1 Ltd. EUR263.5 Million Floating-Rate Credit-Linked Notes Ratings Lowered And Removed From CreditWatch Negative A+ BBB (sf) A+ (sf)/Watch Neg A BBB- (sf) A+ (sf)/Watch Neg B BB- (sf) BBB (sf)/Watch Neg C B- (sf) BB+ (sf)/Watch Neg D CCC (sf) B+ (sf)/Watch Neg Rating Affirmed E CCC- (sf) =========== G R E E C E =========== FREESEAS INC: Receives Non-Compliance Notice From NASDAQ -------------------------------------------------------- FreeSeas Inc. received a letter from The NASDAQ Stock Market, notifying the Company that for the last 30 consecutive business days, the closing bid price of the Company's common stock has been below US$1.00 per share, the minimum closing bid price required by the continued listing requirements of NASDAQ set forth in Listing Rule 5450(a)(1). In accordance with Listing Rule 5810(c)(3)(A), the Company has 180 calendar days, or until Dec. 16, 2013, to regain compliance with the Rule. To regain compliance, the closing bid price of the Company's common stock must be at least US$1.00 per share for a minimum of 10 consecutive business days during the Compliance Period. The NASDAQ notification has no effect at this time on the listing of the Company's common stock on the NASDAQ Capital Market. If the Company does not regain compliance by Dec. 16, 2013, NASDAQ will provide written notification to the Company that its common stock may be delisted. The Company may, however, be eligible for an additional grace period of 180 calendar days if it satisfies the continued listing requirement for market value of publicly held shares and all other initial listing standards (with the exception of the Bid Price Rule) for listing on the NASDAQ Capital Market, and submits a timely notification to NASDAQ of its intention to cure the deficiency during the second compliance period, by effecting a reverse stock split of the shares of its Common Stock, if necessary. The Company may also appeal NASDAQ's delisting determination to a NASDAQ Hearings Panel. There is no assurance as to the price at which the Company's common stock will trade. The Company intends to actively monitor the bid price for its common stock during the Compliance Period, and if the common stock continues to trade below the minimum bid price required for continued listing, the Company's board of directors will consider its options to regain compliance with the continued listing requirements. About FreeSeas Inc. Headquartered in Athens, Greece, FreeSeas Inc., formerly known as Adventure Holdings S.A., was incorporated in the Marshall Islands on April 23, 2004, for the purpose of being the ultimate holding company of ship-owning companies. The management of FreeSeas' vessels is performed by Free Bulkers S.A., a Marshall Islands company that is controlled by Ion G. Varouxakis, the Company's Chairman, President and CEO, and one of the Company's principal shareholders. The Company's fleet consists of six Handysize vessels and one Handymax vessel that carry a variety of drybulk commodities, including iron ore, grain and coal, which are referred to as "major bulks," as well as bauxite, phosphate, fertilizers, steel products, cement, sugar and rice, or "minor bulks." As of Oct. 12, 2012, the aggregate dwt of the Company's operational fleet is approximately 197,200 dwt and the average age of its fleet is 15 years. Freeseas disclosed a net loss of US$30.88 million in 2012, a net loss of US$88.19 million in 2011, and a net loss of US$21.82 million in 2010. The Company's balance sheet at Dec. 31, 2012, showed US$114.35 million in total assets, US$106.55 million in total liabilities and US$7.80 million in total shareholders' equity. RBSM LLP, in New York, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2012. The independent auditors noted that the Company has incurred recurring operating losses and has a working capital deficiency. In addition, the Company has failed to meet scheduled payment obligations under its loan facilities and has not complied with certain covenants included in its loan agreements. It has also failed to make required payments to Deutsche Bank Nederland as agreed to in its Sept. 7, 2012, amended and restated facility agreement and received notices of default from First Business Bank. Furthermore, the vast majority of the Company's assets are considered to be highly illiquid and if the Company were forced to liquidate, the amount realized by the Company could be substantially lower that the carrying value of these assets. These conditions among others raise substantial doubt about the Company's ability to continue as a going concern. * Moody's Notes Worsening Greek RMBS Performance in May 2013 ------------------------------------------------------------ The performance of the Greek residential mortgage-backed securities (RMBS) market continued to weaken during the three- month period up to May 2013, according to the latest indices published by Moody's Investors Service. In May 2013, 90+ day delinquencies of Greek RMBS transactions increased but remained in a narrow and low range between 1.2%- 2.8%, with the exception of one transaction. The weighted average 90+ day delinquency trend increased to 4.7% of the current balance in May 2013, up from 3.6% in May 2012. In the same period the 90+ day delinquencies of Estia Mortgage Finance II PLC, the worst performer in the Greek RMBS market, rose to 8.8%, from 6.4%. Similarly, the cumulative defaults transactions increased but remained in a narrow and low range between 0.4%-1.4% of original balance, with the exception of Estia Mortgage Finance II PLC, which recorded 5.4% in May 2013. The weighted-average cumulative default trend increased to 1.7% of the original balance in May 2013, from 1.1% in May 2012. The continuing deterioration in performance is driven by the weak economic environment and high unemployment levels in Greece. While the reserve funds of four transactions are currently below their target levels, no transactions have fully drawn their reserve funds. In May 2013, the current outstanding pool balance of Greek RMBS transactions was EUR2.7 billion, compared with EUR3.0 billion in May 2012, a 11% year-over-year decrease as a result of planned amortization. In total, 11 Moody's-rated RMBS transactions launched since 2004 have been included in the index. The number of transactions has decreased over time and currently only seven transactions remain outstanding. ========= I T A L Y ========= A-LEASING SPA: Moody's Lowers Rating on EUR29.85MM C Notes to B1 ---------------------------------------------------------------- Moody's Investors Service has affirmed the ratings of the Class A and Class B notes and confirmed the ratings of the Class C notes, in Pharma Finance 2 S.r.l. Sufficient levels of credit enhancement, which protect against sovereign and counterparty risk, primarily drove the rating actions. At the same time, Moody's affirmed the ratings of the Class A notes and downgraded the ratings of the Class B and the Class C notes in A-Leasing Finance S.r.l. Insufficient credit enhancement to address sovereign risk and exposure to counterparty risk has prompted these negative rating actions. Both transactions are Italian asset-backed securities (ABS) transaction backed by lease installments. In addition, Pharma Finance 2 is backed by a small portion of loans. The installments in Pharma Finance 2 were originated by Comifin S.p.A. (unrated) and extended to Italian pharmacists only whereas the installments in A-Leasing Finance were originated by A-Leasing S.p.A. (unrated) and extended to borrowers in different industries. these rating actions conclude the reviews for downgrade initiated by Moody's on August 2, 2012 and March 13, 2013, respectively. Ratings Rationale: Pharma Finance 2 These rating actions on Pharma Finance 2 primarily reflect 1) the availability of sufficient credit enhancement to address sovereign and increased counterparty risk and 2) the good performance of the deal, which is in line with Moody's expectation. The current credit enhancement levels are 97.2% for the Class A notes, 55.5% for Class B notes and 21.1% for the Class C notes. Credit enhancement has built up to these levels as a result of the deleveraging since the end of the revolving period in May 2007, as evidenced by the low pool factor of 7.5%. The introduction of new adjustments to Moody's modeling assumptions to account for the effect of deterioration in sovereign creditworthiness has had no negative effect on the ratings in this transaction. A-Leasing Finance The rating actions on A-Leasing Finance primarily reflect 1) the lack of sufficient credit enhancement to address sovereign and increased counterparty risk and 2) the worse-than-expected performance since its closing in June 2008. The current credit enhancement levels are 64.9% for the Class A notes, 42.4% for Class B notes and 20.2% for the Class C notes. In contrast to Pharma Finance 2 the credit enhancement levels for the Class B and the Class C notes in A-Leasing Finance are insufficient to mitigate sovereign and counterparty risk which has resulted in downgrades. The introduction of new adjustments to Moody's modeling assumptions to account for the effect of deterioration in sovereign creditworthiness mainly lead to these rating actions. Additional Factors Better Reflect Increased Sovereign Risk Moody's has supplemented its analysis to determine the loss distribution of securitized portfolios with two additional factors, the maximum achievable rating in a given country (the local currency country risk ceiling) and the applicable portfolio credit enhancement for this rating. With the introduction of these additional factors, Moody's intends to better reflect increased sovereign risk in its quantitative analysis, in particular for mezzanine and junior tranches. The Italian country ceiling is A2, which is the maximum rating that Moody's will assign to a domestic Italian issuer including structured finance transactions backed by Italian receivables. The portfolio credit enhancement represents the required credit enhancement under the senior tranche for it to achieve the country ceiling. By lowering the maximum achievable rating, the revised methodology alters the loss distribution curve and implies an increased probability of high loss scenarios. Under the updated methodology incorporating sovereign risk on ABS transactions, loss distribution volatility increases to capture increased sovereign-related risks. Given the expected loss of a portfolio and the shape of the loss distribution, the combination of the highest achievable rating in a country for structured finance and the applicable credit enhancement for this rating uniquely determine the volatility of the portfolio distribution, which the coefficient of variation (CoV) typically measures for ABS transactions. A higher applicable credit enhancement for a given rating ceiling or a lower rating ceiling with the same applicable credit enhancement both translate into a higher CoV. Moody's Revises Key Collateral Assumptions Following Moody's update of its methodology, the rating agency increased the CoV, which is a measure of volatility, in Pharma Finance 2, to 150.5% from 74.0%. Together with the unchanged assumptions on the mean default probability of 3.0% on current pool balance and the recovery rate of 30.0%, this volatility increase corresponds to a portfolio credit enhancement of 20.0%. Following Moody's update of its methodology, the rating agency increased the CoV in A-Leasing Finance to 49.6% from 40.0%. Together with the unchanged assumptions on the mean default probability of 23.0% on current pool balance and the recovery rate of 50.0%, this volatility increase corresponds to a portfolio credit enhancement of 26.0%. Moody's maintained its default and recovery rate assumptions for these transactions, which it updated on December 18, 2012. Counterparty Exposure The conclusion of Moody's rating reviews also takes into consideration the counterparty exposure. Comifin acts as servicer and Credit Agricole Corporate and Investment Bank (A2/P-1) as swap counterparty and issuer account bank in Pharma Finance 2. Collections are transferred monthly from the collection account to the issuer account. The reserve fund represents 21.1% of the current pool balance. A-Leasing. acts as servicer, BNP Paribas S.A. (A2/P-1) as swap counterparty and BNP Paribas Securities Services (A2-P-1) as issuer account bank in A-Leasing Finance. Collections are transferred to the issuer account every time there is an amount higher than EUR50,000 in the collection account. The reserve fund is fully depleted whereas the debt reserve account accounts for 4.2% of the current pool balance and is also held at BNP Paribas Securities Services. Moody's has incorporated into its analysis the potential default of the servicer, which could expose the transactions to a commingling loss on the collections and to a loss of the monies held in the reserve account. In addition, Moody's considered the potential effect of originator insolvency on the recoveries in both transactions. If the originator became insolvent, Moody's would expect recoveries on defaulted lease contracts to be approximately 15%. The rating agency also assessed the exposure to the swap counterparties in both transactions, which does not have a negative effect on the rating levels at this time. Other Developments May Negatively Affect the Notes In consideration of Moody's new adjustments, any further sovereign downgrade would negatively affect structured finance ratings through the application of the country ceiling or maximum achievable rating, as well as potentially increased portfolio credit enhancement requirements for a given rating. As the euro area crisis continues, the ratings of structured finance notes remain exposed to the uncertainties of credit conditions in the general economy. The deteriorating creditworthiness of euro area sovereigns as well as the weakening credit profile of the global banking sector could further negatively affect the ratings of the notes. Moody's describes additional factors that may affect the ratings in the Request for Comment, "Approach to Assessing Linkage to Swap Counterparties in Structured Finance Cashflow Transactions: Request for Comment", July 2, 2012. In reviewing these transactions, Moody's used ABSROM to model the cash flows and determine the loss for each tranche. The cash flow model evaluates all default scenarios that are then weighted considering the probabilities of the inverse-normal distribution assumed for the portfolio default rate. In each default scenario, Moody's calculates the corresponding loss for each class of notes given the incoming cash flows from the assets and the outgoing payments to third parties and noteholders. Therefore, the expected loss for each tranche is the sum product of the probability of the occurrence of each default scenario and the loss derived from the cash flow model in each default scenario for each tranche. As such, Moody's analysis encompasses the assessment of stressed scenarios. When remodeling these transactions affected by this rating action, Moody's adjusted some inputs to reflect the new approach. Methodologies The methodologies used in these ratings were "Moody's Approach to Rating Multi-Pool Financial Lease-Backed Transactions in Italy", published in June 2006, "Moody's Approach to Rating EMEA SME Balance Sheet Securitisations", published in May 2013, and "The Temporary Use of Cash in Structured Finance Transactions: Eligible Investment and Bank Guidelines", published in March 2013. The revised approach to incorporating country risk changes into structured finance ratings forms part of the relevant asset class methodologies, which Moody's updated and republished or supplemented on March 11, 2013 ("Incorporating Sovereign Risk into Multi-Pool Financial Lease-Backed Transactions in Italy"), along with the publication of its Special Comment "Structured Finance Transactions: Assessing the Impact of Sovereign Risk". List of Affected Ratings Issuer: A-Leasing Finance S.r.l EUR230.85M A Notes, Affirmed A2 (sf); previously on Aug 2, 2012 Downgraded to A2 (sf) EUR30.2M B Notes, Downgraded to Baa2 (sf); previously on Jun 13, 2008 Assigned A2 (sf) EUR29.85M C Notes, Downgraded to B1 (sf); previously on Mar 13, 2013 Baa2 (sf) Placed Under Review for Possible Downgrade Issuer: Pharma Finance 2 S.r.l. EUR123.3M A Notes, Affirmed A2 (sf); previously on Aug 2, 2012 Downgraded to A2 (sf) EUR8.2M B Notes, Affirmed A2 (sf); previously on Nov 16, 2005 Definitive Rating Assigned A2 (sf) EUR5.5M C Notes, Confirmed at Baa2 (sf); previously on Aug 2, 2012 Baa2 (sf) Placed Under Review for Possible Downgrade BANCA MONTE: Fitch Affirms 'CC' Preferred Stock Rating ------------------------------------------------------ Fitch Ratings has affirmed Banca Monte dei Paschi di Siena's (MPS) Long-term Issuer Default Rating (IDR) at 'BBB', Short-term IDR at 'F3', Support Rating (SR) at '2' and Support Rating Floor (SRF) at 'BBB'. The Outlook is Negative. At the same time Fitch maintained MPS's Viability Rating (VR) at 'b' on Rating Watch Negative (RWN). KEY RATING DRIVERS - IDRS, SR, SRF AND SENIOR DEBT MPS's Long-term IDR is at its SRF and therefore based on support from the Italian authorities. The affirmations of the IDRs, SR and SRF reflect Fitch's unchanged view that there is a high probability that MPS would continue to receive support from the Italian government given its systemic importance domestically. MPS received EUR2.2 billion new capital from the government in the form of hybrid instruments issued by the bank in Q113 in addition to EUR1.9 billion hybrid capital received from the government in 2009. The terms of the government hybrid instruments issued in Q113 include an option for the bank to convert the instruments into common shares. This, and the possibility that coupon payments for these new hybrid instruments under certain circumstances can be paid in the form of MPS's shares, means that the state could become a shareholder of the bank in the future, which underpins Fitch's view of a high probability of continued support for senior creditors. The Negative Outlook on MPS's Long-term IDR mirrors the Negative Outlook on Italy's 'BBB+' Long-term IDR and reflects Fitch's view that MPS's SRF would most likely be revised downward if the Italian sovereign was downgraded. A downward revision of the SRF would result in a downgrade of the bank's Long-term IDR. RATING SENSITIVITIES - IDRS, SR, SRF AND SENIOR DEBT MPS's IDRs, SR, SRF and senior debt ratings are sensitive to a change in Fitch's assumptions about the availability of sovereign support for the bank. A downgrade of Italy's sovereign rating would likely result in a downward revision of the SRF, and therefore a downgrade of the Long-term IDR, as it would indicate a reduction in the authorities' ability to provide support. The SRF and SR would also come under pressure if Fitch considered that the propensity of the authorities to provide support to all senior creditors had changed, which is not currently factored into the agency's analysis. In particular, Fitch's view on support is sensitive to developments within the regulatory and legal framework, particularly emanating from the European Commission with regard to bail-ins, centralized regulatory oversight and adjustments to deposit insurance schemes. Fitch currently expects that the Italian authorities will be able to provide support to MPS, but the European Commission has not yet granted its final approval for the provision of state aid, which the bank has already received. MPS's SR and SRF would come under pressure if changes or limitations in the provision of state aid to MPS increased the risk of reduced government support to all senior creditors, which Fitch currently does not factor into MPS's SR and SRF. Any downward revision of MPS's SRF would lead to a downgrade of the bank's IDRs. In line with Fitch's criteria, the bank's Long- term IDR is the higher of the VR and the SRF. KEY RATING DRIVERS - VR MPS's VR reflects the agency's opinion that although the prospects for MPS's ongoing viability remain weak in a difficult operating environment, the injection of hybrid capital from the government has provided an additional buffer to absorb potential future losses. The RWN on the VR reflects the fact that the state aid provided to MPS has not yet been approved by the European Commission, thus creating some uncertainty. MPS's VR reflects Fitch's expectation that the bank's operating performance will remain weak and that asset quality is likely to deteriorate further as the Italian economy remains in recession. The VR also reflects the credit and market risk the bank is exposed to through its securities portfolio, which at end-2012 included EUR25.8bn Italian government bonds. In Fitch's opinion, MPS faces challenges in implementing its business plan, and a revised restructuring plan has been submitted following the receipt of state aid for approval to the European Commission. MPS's capitalization relies on government hybrid capital, the cost of which is high, which will make internal capital generation difficult. MPS reported a EUR3.2 billion net loss for 2012, which included the impact of EUR1.65 billion goodwill impairment and EUR3 billion loan impairment charges. For Q113, the bank made a EUR101 million net loss as loan impairment charges remained high, and Fitch expects a weak operating performance for 2013. Asset quality deteriorated further in Q113, and gross impaired loans at end-March 2013 were equal to a high 18.8% of gross loans. The bank has worked on improving cost efficiency, and 2012 and Q113 results confirmed that cost reduction efforts were ahead of plan. MPS's end-2012 Fitch Core Capital (FCC)/weighted risks ratio, which excludes EUR4.1 billion government hybrid capital, was weak at 4.7%. The government hybrid capital, injected in part in 2009 and in part in Q113, is included in Fitch eligible capital (FEC). The increase in government hybrid capital in Q113 strengthens the bank's FEC/weighted risks ratio to an estimated 9.3% based on end-2012 risk-weighted assets on a pro-forma basis. In Fitch's opinion, this is still low given the high volume of unreserved impaired loans, which at end-2012 were equal to 194% of the bank's equity. RATING SENSITIVITIES - VR The bank's VR factors in weak operating profitability and is based on Fitch's expectation that pressure on profitability and asset quality will persist, but that any operating loss that could arise from continued asset quality deterioration or from the bank's securities portfolio would be manageable with MPS's current capitalization. Losses that would require an injection of fresh capital to ensure the bank's viability would result in a downgrade of the VR. An upgrade of the VR would require a stabilization of the bank's performance and signs that the bank can generate adequate operating profit and improve asset quality, which Fitch believes will prove challenging. Fitch will review the RWN once the final decision of the European Commission's final decision regarding the state aid is reached. An approval of state aid based on the bank's restructuring plan, which Fitch believes is the most likely outcome, would likely result in an affirmation of the VR and a removal of the RWN. If the state aid is not approved or material changes to the proposed restructuring plan are required, Fitch will review the potential impact of the additional European Commission requirements on the bank's viability. KEY RATING DRIVERS - SUBORDINATED DEBT AND OTHER HYBRID SECURITIES Subordinated debt and other hybrid capital issued by MPS are all notched down from MPS's VR in accordance with Fitch's assessment of each instrument's respective non-performance and relative loss severity risk profiles, which vary considerably. The ratings of the bank's Upper Tier 2 and Tier 1 instruments and preferred securities reflects Fitch's opinion that these notes' non-performance risk in the form of non-payment of coupon is high in the coming years. The receipt of state aid means that in case of reporting a net loss MPS will be obliged not to make coupon payments where the terms of the instruments allow for non- payment. The Upper Tier 2 notes are rated one notch above the Tier 1 instruments to reflect the cumulative coupon on these instruments, whereas coupon payments on Tier 1 instruments is non-cumulative. RATING SENSITIVITIES - SUBORDINATED DEBT AND OTHER HYBRID SECURITIES The ratings of subordinated debt and other hybrid capital issued by MPS are sensitive to any change in MPS's VR and to changes in Fitch's assumptions on the probability and severity of non- performance of these notes. The RWN on the bank's Lower Tier 2 debt rating reflects the RWN on MPS's VR. The rating actions are: MPS: -- Long-term IDR: affirmed at 'BBB'; Outlook Negative -- Short-term IDR: affirmed at 'F3' -- VR: 'b'; RWN maintained -- Support Rating: affirmed at '2' -- Support Rating Floor: affirmed at 'BBB' -- Debt issuance programme (senior debt): affirmed at 'BBB' -- Senior unsecured debt, including guaranteed notes: affirmed at 'BBB' -- Lower Tier 2 subordinated debt: 'B-'; RWN maintained -- Upper Tier 2 subordinated debt: affirmed at 'CCC' -- Preferred stock and Tier 1 notes: affirmed at 'CC' =========== R U S S I A =========== IBA-MOSCOW: Fitch Assigns 'BB' Rating to RUB3-Bil. Bond Issue ------------------------------------------------------------- Fitch Ratings has assigned Russia-based IBA-Moscow's (IBAM) RUB3 billion bond issue a final 'BB' rating. The issue benefits from recourse to IBAM's parent, International Bank of Azerbaijan (IBA, 'BB'/Stable/'b-'). The bond has a 10.75% interest rate and a three-year tenor with an early redemption option in December 2014. Should IBAM fail to make an interest or principal payment under the terms of the bond, bondholders will benefit from a put option, allowing them to sell the bonds to IBA. IBA's offer to purchase the bonds in case of a default by IBAM represents an irrevocable undertaking and ranks equally with IBA's other senior unsecured obligations, save those preferred under Azerbaijan law. Under Azerbaijan law, retail depositors rank ahead of other senior unsecured creditors. Retail deposits accounted for 25% of IBA's total liabilities at end-2012, according to the bank's unconsolidated statutory accounts. KEY RATING DRIVERS AND SENSITIVITIES The assignment of the final rating follows the completion of bond placement, which was initially assigned an expected 'BB(EXP)' rating. TATNEFT OAO: Fitch Affirms 'BB+' Long-Term Issuer Default Rating ---------------------------------------------------------------- Fitch Ratings has affirmed OAO Tatneft's Long-term Issuer Default Rating (IDR) at 'BB+'. The Outlook is Stable. Key Rating Drivers Relatively Small Scale, Lack of Diversification With the daily output of 0.51m barrels of oil equivalent (boe), Tatneft is a small- to medium-sized oil company. The company's major assets are located in the Republic of Tatarstan, Russia (BBB-/Stable). The company's largest deposit Romashkinskoye provides up to 60% of the total crude oil output. Comfortably Long Reserve Life As of January 2013 the company had 6.2bn bbl of crude oil and condensate reserves which provide 33 years of reserve life with 2012 output of 187.4m bbl - the longest amongst Russian peers. However, oil reserves are mature, which results in higher lifting costs compared with Russian peers. In 2012, the company reported average lifting costs of RUB220 per 1 bbl (+9.5% yoy). Full Utilization of Taneco Refinery in 2012 In December 2011, the company commissioned the Taneco refinery plant with an annual capacity of 7mmt. It was fully utilized in 2012 with 6.9mmt of refined products output. Up to 30% of the company's crude oil is currently refined in Taneco. The change of the company's sales structure in favor of refined products and domestic market lowered the relative amount of export duties to 29.1% of gross revenue in 2012 compared with 32.2% in 2011. As a result, the company improved its EBITDAR per 1 bbl of crude oil output in 2012 by 16% yoy to RUB653 from RUB565 in 2011. Fitch views positively the change in the company's business model due to the commissioning of Taneco. Conservative Capital Structure The company has a conservative capital structure with funds from operations (FFO) adjusted gross leverage of 0.68x at end-2012. Fitch expects Tatneft to show positive free cash flow in 2013- 2014, which will contribute to further deleveraging to 0.5x by end-2013 and to 0.2x by end-2014. Fitch's base case expectations do not include Tatneft's possible investments in the doubling Taneco's capacity. RATING SENSITIVITIES Positive: Future developments that could lead to positive rating actions include: - FFO adjusted gross leverage sustainably below 1.0x - FFO interest coverage above 10.0x - Ability to maintain stable crude oil output Negative: Future developments that could lead to negative rating action include: - FFO adjusted gross leverage sustainably above 2.0x - FFO interest coverage below 10.0x FULL LIST OF RATING ACTIONS -- Foreign currency Long-term IDR: affirmed at 'BB+'; Stable Outlook -- Foreign currency Short-term IDR: affirmed at 'B' * KRASNOYARSK REGION: Fitch Affirms 'BB+' LT Currency Ratings ------------------------------------------------------------- Fitch Ratings has affirmed the Russian Krasnoyarsk Region's Long- term foreign and local currency ratings at 'BB+'. The agency has also affirmed the region's National Long-term rating at 'AA(rus)' and Short-term foreign currency rating at 'B'. The Outlook on the Long-term ratings is Positive. The rating action also affects Krasnoyarsk Region's two outstanding senior unsecured domestic bonds of RUB22.3 billion. Key Rating Drivers The ratings reflect the region's satisfactory budgetary performance, its good liquidity and moderate debt. They also take into account the concentrated tax base and exposure of the region's economy to business cycles in the primary sectors. The Positive Outlook reflects the region's ability to withstand temporary deterioration of budgetary performance and expected improvement in budgetary performance. Fitch expects Krasnoyarsk to post a slightly improved budgetary performance in 2013-2015 with margins restoring to about 11%-15%. The region's operating balance decreased to 7% of operating revenue in 2012 (2011: 16.6%). Changes in the fiscal regime enacted in 2012 led to reduced profits and stagnation of the region's tax revenue, while its opex increased. The region's deficit before debt variation widened to 16.6% of total revenue in 2012 (2011: 2.5%). Taxation represented 85.9% of Krasnoyarsk region's operating revenue in 2012 (2011: 85.5%). The region's tax base remains concentrated as the 10 largest taxpayers accounted for 48% of proceeds in 2012 (2011: 56%). The local economy's exposure to fiscal changes and/or volatile business cycles in the primary sectors is likely to remain in the medium term. Fitch expects the region's economy to expand at about 3%-4% in 2013-2015. Economic growth in the region is underpinned by development of natural resources and non-ferrous metallurgy. The region's strong industrial profile supports above the national average wealth metrics. Krasnoyarsk region funded sizeable capital outlays, amounting to 27% of total spending in 2012. The region's self-financing capacity decreased with current balance and capital revenue covering 48.6% of capex (2011: 91.1%). Fitch expects a gradual improvement in the region's capex self-financing capacity in the medium term, along with maintenance of capex at about 22%-25% of total spending. Fitch expects the region's direct risk to be at about 23% of current revenue and about 2.4 years of current balance by end- 2013, and 24%-25% and about 2 years respectively, in the medium term. Krasnoyarsk resorted to extra borrowing for capex financing and its direct risk increased to RUB27.4 billion in 2012 (2011: RUB14.1 billion). It was composed of 94.5% domestic bonds and 5.5% budget loans contracted from the federal government. Fitch expects continued liquidation of cash accumulated by the region in 2013-2015. Krasnoyarsk depleted part of its cash in 2012, reducing cash reserves to RUB17.6 billion (2011: RUB27.6 billion) to fund capex. The region deposits its access cash in commercial banks, with earned interest revenue on deposits of RUB0.7 billion in 2010-2011. RATING SENSITIVITIES Stronger budgetary performance with double-digit margins providing debt coverage ratios in line with the agency's expectations would be positive for the ratings. * Fiscal Pressures Unlikely to Affect Ratings for Russian Regions ----------------------------------------------------------------- Although Russian regions will experience an increase in their financial leverage in 2013, this is unlikely to have immediate rating implications, says Moody's Investors Service in a new Special Comment entitled "Russian Regions Face Growing Fiscal Pressure." Moody's expects that subdued tax growth driven by Russia's economic deceleration and increasingly rigid expenditure profiles will likely lead to growing financing deficits in 2013. This is likely to force regions to moderately increase their net direct and indirect debt to around 38% of total revenue on average from 32.4% in 2012. Nevertheless, Moody's does not envisage any immediate credit implications for most rated Russian regions in 2013 given that (1) lengthening maturities on new loans from the local banks will provide greater stability despite growing funding costs; (2) the federal government has historically and will continue to provide liquidity support; and (3) deficit and debt levels remain consistent with current ratings. ========= S P A I N ========= BBVA EMPRESAS 6: Moody's Confirms B3 Rating on EUR156MM C Notes --------------------------------------------------------------- Moody's Investors Service has downgraded by one notch the junior tranche of BBVA Empresas 5 and upgraded by three to four notches the ratings of the junior and mezzanine tranches of BBVA Empresas 3 and BBVA Empresas 6. At the same time, Moody's confirmed the ratings of six tranches (rated from B3 (sf) to A3 (sf)) of BBVA Empresas 3, BBVA Empresas 4, BBVA Empresas 5 and BBVA Empresas 6. While increased counterparty risk and exposure to borrower concentration triggered the downgrade of the junior tranche of BBVA Empresas 5, sufficient credit enhancement, which protects against sovereign and counterparty risk, primarily drove the rating upgrades and confirmations. This rating action concludes the review for downgrade initiated by Moody's on July 2, 2012. The four transactions are Spanish asset-backed securities transactions backed by loans to small and medium-sized enterprises (SME ABS) that were originated by Banco Bilbao Vizcaya Argentina S.A (BBVA, Baa3/P-3). Ratings Rationale: This rating action primarily reflects the availability of sufficient credit enhancement to address sovereign and increased counterparty risk. The introduction of new adjustments to Moody's modeling assumptions to account for the effect of deterioration in sovereign creditworthiness has had no effect on the ratings of six classes of notes in the four transactions. Furthermore, the current level of credit enhancement available under the Class C notes of BBVA Empresas 3 (63.5%) and under the Class B notes of BBVA Empresas 6 (39.7%) in the form of reserve funds and/or subordination is sufficient to support the following upgrades: to Baa1 (sf) from Ba2 (sf) for the Class C notes of BBVA Empresas 3 and to Baa3 (sf) from Ba3 (sf) for the Class B notes of BBVA Empresas 6. While sovereign risk is largely mitigated by the high level of credit enhancement (39.0%) as of March 2013, increased counterparty risk and exposure to borrower concentration drove the downgrade of the Class B notes of BBVA Empresas 5. As the credit enhancement is entirely in the form of a reserve fund held at BBVA, the Class B notes are strongly linked to BBVA's rating. In addition, the exposure to the five biggest borrowers in the transaction amounts currently to 15%, which could lead to large losses should any of these borrowers default. As a result, Moody's downgraded the Class B notes to Baa1 (sf) from A3 (sf). The credit enhancement levels in BBVA Empresas 3 on March 25, 2013 were 126.7%, 84.6% and 63.5% for the Class A, B and C notes, respectively. The cumulative defaults in the collateral pool adds up to 5.5% of the initial pool balance as of April 2013. The credit enhancement level in BBVA Empresas 4 on February 25, 2013 was 103.9%, which is entirely in the form of a reserve fund. The cumulative default recorded in the collateral pool adds up to 3.0% of the initial pool balance as of the end of April 2013. The credit enhancement levels in BBVA Empresas 5 on March 14, 2013 were 82.9%, and 39.0% respectively for the Class A and B notes. The cumulative default recorded in the collateral pool adds up to 0.8% of the initial pool balance as of mid-May 2013. The credit enhancement levels in BBVA Empresas 6 on May 14, 2013 were 71.5%, 39.7% and 19.1% respectively for Class A, B and C notes. There is limited cumulative default recorded in the collateral pool as of mid-May 2013. - Additional Factors Better Reflect Increased Sovereign Risk Moody's has supplemented its analysis to determine the loss distribution of securitized portfolios with two additional factors, the maximum achievable rating in a given country (the local currency country risk ceiling) and the applicable portfolio credit enhancement for this rating. With the introduction of these additional factors, Moody's intends to better reflect increased sovereign risk in its quantitative analysis, in particular for mezzanine and junior tranches. The Spanish country ceiling is A3, which is the maximum rating that Moody's will assign to a domestic Spanish issuer including structured finance transactions backed by Spanish receivables. The portfolio credit enhancement represents the required credit enhancement under the senior tranche for it to achieve the country ceiling. By lowering the maximum achievable rating, the revised methodology alters the loss distribution curve and implies an increased probability of high loss scenarios. Under the updated methodology incorporating sovereign risk on ABS transactions, loss distribution volatility increases to capture increased sovereign-related risks. Given the expected loss of a portfolio and the shape of the loss distribution, the combination of the highest achievable rating in a country for structured finance and the applicable credit enhancement for this rating uniquely determines the volatility of the portfolio distribution, which the coefficient of variation (CoV) typically measures for ABS transactions. A higher applicable credit enhancement for a given rating ceiling or a lower rating ceiling with the same applicable credit enhancement both translate into a higher CoV. - Moody's Revises Key Collateral Assumptions Moody's maintained its default and recovery rate assumptions for the transactions, which it updated on December 21, 2012. According to the updated methodology, Moody's increased the CoV, which is a measure of volatility. For BBVA Empresas 3, Moody's current default assumption is 18.2% of the current portfolio and the assumption for the fixed recovery rate is 45%. Moody's has increased the CoV to 56.5% from 40.0%, which, combined with the revised key collateral assumptions, corresponded to a portfolio credit enhancement of 24.7%. For BBVA Empresas 4, Moody's current default assumption is 17.1% of the current portfolio and the assumption for the fixed recovery rate is 45%. Moody's has increased the CoV to 60.3% from 48.5%, which, combined with the revised key collateral assumptions, corresponded to a portfolio credit enhancement of 24.6%. For BBVA Empresas 5, Moody's current default assumption is 14.9% of the current portfolio and the assumption for the fixed recovery rate is 42.5%. Moody's has increased the CoV to 60.1% from 42.6%, which, combined with the revised key collateral assumptions, corresponded to a portfolio credit enhancement of 21.5%. For BBVA Empresas 6, Moody's current default assumption is 20.2% of the current portfolio and the assumption for the fixed recovery rate is 46.5%. Moody's has increased the CoV to 57.8% from 40.1%, which, combined with the revised key collateral assumptions, corresponded to a portfolio credit enhancement of 26.0%. In addition, Moody's incorporated stress scenarios in its analysis to cover for the fact that the pools in Empresas 5 and 6 are highly concentrated and that this concentration levels are not embedded in its CoV and portfolio credit enhancement levels, which assume a granular portfolio. - Moody's Has Considered Exposure to Counterparty Risk The conclusion of Moody's rating review also takes into consideration the increased exposure to commingling due to weakened counterparty creditworthiness. In the four transactions, BBVA acts as servicer and transfers collections on the second business day following receipt to the issuers' account held by BBVA. Moody's has incorporated into its analysis the potential default of BBVA as servicer and issuer account bank, which could expose the transaction to a loss of the reserve fund as well as a three-month commingling loss. Ultimately, the linkage to BBVA only negatively affects the Class B notes in BBVA Empresas 5 because of the size of the reserve fund. The four transactions are also exposed to BBVA acting as swap counterparty. As part of its analysis, Moody's took into account the counterparty risk related to these swaps, which has no negative impact on the ratings of the notes at this time. - Other Developments May Negatively Affect the Notes In consideration of Moody's new adjustments, any further sovereign downgrade would negatively affect structured finance ratings through the application of the country ceiling or maximum achievable rating, as well as potentially increased portfolio credit enhancement requirements for a given rating. As the euro area crisis continues, the ratings of structured finance notes remain exposed to the uncertainties of credit conditions in the general economy. The deteriorating creditworthiness of euro area sovereigns as well as the weakening credit profile of the global banking sector could further negatively affect the ratings of the notes. Moody's describes additional factors that may affect the ratings in its Request for Comment, "Approach to Assessing Linkage to Swap Counterparties in Structured Finance Cashflow Transactions: Request for Comment", July 2, 2012. In reviewing these transactions, Moody's used ABSROM to model the cash flows and determine the loss for each tranche. The cash flow model evaluates all default scenarios that are then weighted considering the probabilities of the inverse normal distribution assumed for the portfolio default rate. In each default scenario, Moody's calculates the corresponding loss for each class of notes given the incoming cash flows from the assets and the outgoing payments to third parties and noteholders. Therefore, the expected loss for each tranche is the sum product of the probability of occurrence of each default scenario and the loss derived from the cash flow model in each default scenario for each tranche. As such, Moody's analysis encompasses the assessment of stressed scenarios. In the context of the rating review, Moody's has remodeled the transactions and adjusted a number of inputs to reflect the new approach. Methodologies The methodologies used in these ratings were "Moody's Approach to Rating EMEA SME Balance Sheet Securitisations", published in May 2013 and "The Temporary Use of Cash in Structured Finance Transactions: Eligible Investment and Bank Guidelines", published in March 2013. List of Affected Ratings Issuer: BBVA Empresas 3, FTA EUR2210M A Notes, Confirmed at A3 (sf); previously on Jul 2, 2012 Downgraded to A3 (sf) and Remained On Review for Possible Downgrade EUR260M B Notes, Confirmed at A3 (sf); previously on Jul 2, 2012 Downgraded to A3 (sf) and Remained On Review for Possible Downgrade EUR130M C Notes, Upgraded to Baa1 (sf); previously on Feb 18, 2011 Assigned Ba2 (sf) Issuer: BBVA Empresas 4, FTA EUR1700M A Notes, Confirmed at A3 (sf); previously on Jul 2, 2012 Downgraded to A3 (sf) and Remained On Review for Possible Downgrade Issuer: BBVA Empresas 5, FTA EUR975M A Notes, Confirmed at A3 (sf); previously on Jul 2, 2012 Downgraded to A3 (sf) and Remained On Review for Possible Downgrade EUR275M B Notes, Downgraded to Baa1 (sf); previously on Jul 2, 2012 A3 (sf) Placed Under Review for Possible Downgrade Issuer: BBVA Empresas 6, FTA EUR804M A Notes, Confirmed at A3 (sf); previously on Jul 2, 2012 Downgraded to A3 (sf) and Remained On Review for Possible Downgrade EUR240M B Notes, Upgraded to Baa3 (sf); previously on Jul 2, 2012 Ba3 (sf) Placed Under Review for Possible Downgrade EUR156M C Notes, Confirmed at B3 (sf); previously on Jul 2, 2012 B3 (sf) Placed Under Review for Possible Downgrade CASER SA: Moody's Cuts Insurance Financial Strength Rating to B1 ---------------------------------------------------------------- Moody's Investors Service has downgraded Caser S.A.'s Insurance Financial Strength Rating (IFSR) to B1 from Ba2. The rating remains on review for further downgrade in line with the review of the owner savings banks. Rating Rationale Caser has a meaningful indirect and direct exposure to Spanish saving banks, namely through its ownership, its high reliance on the saving banks' distribution network to sell insurance products, and a significant exposure to saving banks' debts and deposits. The downgrade reflects Moody's view of Caser's increasing business alignment to its bank owners and distribution partners combined with a gradual increase in the financial connections between Caser and the banks. In Moody's view, the ratings of Caser's main banking owners -- whose standalone credit assessments are on average in the B range -- constrain Caser's rating, driven by the increasing financial and operational linkages between the banks and the insurer. Moody's believes that Caser's results for 2012, as well as recent developments in Q1 2013, indicate the increasing level of financial and operating linkages between Caser and its owner banks. Caser distributes largely through its owner banks and has significant investment exposure to these banks, which weigh on the company's asset quality and capitalization. Regarding Caser's investment quality, a high proportion of the investment exposure to its owner banks are in deposits and senior debt. However, Caser reported substantial exposure to hybrid debt in savings banks at EUR1,029 million at YE2012 (around 13% of invested assets or 114% of shareholders' equity). A substantial number of these hybrids are issued by banks who have received capital support from the EU and have consequently suffered ,or will suffer, sizeable losses. These hybrids are largely associated to bancassurance agreements in life savings business, which included a number of ad-hoc contractual agreements in relation to guaranteed yield, liquidity and funding. Nevertheless given some banks' restructuring framework following the Memorandum of Understanding agreed between Spain and the Eurogroup in July 2012, the associated contractual agreements need to be reconsidered. As a result of this, Caser made a 2012 loss after tax of around EUR283 million mainly driven by ,inter-alia, impairments in investments (pre-tax EUR395 million) as well as further additional negative one-offs. Nevertheless, Moody's notes that the ultimate loss in some Spanish savings banks' hybrid paper continues to be uncertain given a) the substantial ownership of the banks through the Spanish government's Fund for Orderly Bank Restructuring (FROB) and b) their unlisted status following the distressed exchange and uncertainty over the ultimate loss on conversion. As a result, Moody's expects that Caser is likely to incur additional investment losses in 2013. In addition, Caser's liquidity and leverage profile deteriorated in 2012. The company experienced a substantial number of surrenders in the liabilities associated to the aforementioned hybrids as a result of certain contractual features. At YE2012, Caser reported life net-outflows at EUR675 million and a circa 8% decline in provisions. As of Q1 2013, Caser reported a 5% increase in life premiums up to EUR387 million and a EUR214 million life net-outflow, equivalent to a decline of around 12% in provisions. Caser expects an increase of surrenders by 18% over 2013 in comparison to 2012, which will be met through a combination of divestments in both investments and bancassurance agreements, and lines of credit or other forms of funding negotiated with parent banks. Furthermore, Moody's notes Caser's substantial liquid assets in deposits and government debt should help to mitigate potential further stresses on the company's liquidity. In Q1 2013, Caser has also taken a collaterized loan of EUR110 million with Bankia to help meet potential surrenders at a relatively low interest rate (Euribor+90bps). In addition, Moody's notes that Caser has increased operational leverage levels in recent years, although still commensurate with the rating level. Moody's also believes that the ongoing restructuring and consolidation of Spanish saving banks will weaken Caser's long- term franchise, which will weigh on its profitability. Whilst Caser has recently signed agreements in non-life with Ibercaja and Liberbank, the company expects a decline in top line premiums of 12% in 2013 due to the exit of agreements with Banca Civica and Bankia. Positively, Moody's expects the company's technical results to continue to be a credit strength as evidenced by the good combined ratios reported in recent years (five year-combined ratio at 95% at YE 2012) and a low-risk business profile predominantly orientated to retail non-life. In addition, Caser's solvency position continues to be relatively good at around 1.9x (solvency margin at EUR448 million), down from around 2.2x (solvency margin at EUR596 million) due to the sizeable investment losses. Caser also reported a positive impact on the company's tangible capital by EUR250 million in Q1 2013 following the exit of agreements in Bankia and Banca Civica. Nevertheless, the quality of capital remains weak in Moody's opinion, with intangibles representing 68% of shareholder's equity at YE2012. Focus of The Review Moody's review for Caser is in line with the review on most Spanish savings banks, and will consider the potential for further deterioration in Caser's capitalization, profitability or franchise strength, in line with any further weakening in the owner banks' stand-alone credit quality. The following rating was downgraded and remains on review for further downgrade: Caser S.A.- insurance financial strength rating B1 Headquartered in Madrid, Spain, CASER is the ninth largest insurance group in Spain, with a market share of approximately 3.5% at year-end 2012. It offers an extensive range of life, non- life and pension products, distributing its products mostly through Spanish savings banks. CASER reported consolidated gross premiums written of circa EUR2,0 billion and Shareholders' Equity (including minority interests and valuation reserves) of EUR906 million at year-end 2012. What Could Move The Ratings Up/Down Moody's says that an upgrade of the IFSRs is unlikely at the moment given the review for downgrade. Downwards pressure on the IFSR could develop following ii) a downgrade in Spanish saving banks' baseline credit assessments (i) material deterioration in capitalization following further deterioration in Caser's investment quality beyond own estimates and/or (iii) significant deterioration in the group's operating performance with a combined ratio consistently above 100% and returns on capital below 4%. Methodologies Used The methodologies used in this rating were Moody's Global Rating Methodology for Life Insurers published in May 2010, and Moody's Global Rating Methodology for Property and Casualty Insurers published in May 2010. CODERE SA: Creditors Agree to Extend Financing thru June 28 ----------------------------------------------------------- Jim Silver at Bloomberg News reports that Codere SA said in a Spanish regulatory filing the company's creditors agreed to extend senior facilities agreement to June 28, allowing for completion of documents for previously announced financing accord. On June 13, Codere said the company agreed to a six-month financing plan, with offer valid until June 21, subject to completion of documentation, Bloomberg relates. Codere SA is a Spain-based company engaged, together with its subsidiaries, in the operation of activities related to the private gaming sector, principally in the operation of arcade and slot machines, sports betting houses, bingo halls, casinos and racetracks. The Company has presence in Spain, Italy, Argentina, Brazil, Colombia, Mexico, Panama and Uruguay. * * * As reported by the Troubled Company Reporter-Europe on March 13, 2013, Moody's Investors Service downgraded to Caa2 from Caa1 the corporate family rating and from Caa1-PD to Caa2-PD the probability of default rating of Codere S.A. Concurrently, Moody's has downgraded to Caa3 from Caa2 the ratings on Codere Finance (Luxembourg) S.A.'s EUR760 million worth of 8.25% senior notes due 2015 and USD300 million worth of 9.25% senior notes due 2019. S&P said the outlook on all ratings is negative. FTA SANTANDER 2007-1: Fitch Cuts Rating on Class D Notes to 'D' --------------------------------------------------------------- Fitch Ratings has downgraded FTA Santander Consumer Spain Auto 07-1's class D notes to 'Dsf' from 'CCsf' and subsequently withdrawn the rating. The remaining notes have paid in full (PIF). FTA Santander 2007-1 was called on March 20, 2013 using proceeds from the sale of the portfolio. The rating actions reflect the final distribution of the portfolio sale proceeds to noteholders. As a result of the portfolio sale, the class A, B and C notes have been PIF as they received all interest and principal that was owed to them upon the redemption. The uncollateralized class D notes were paid off up to EUR20.8 million (EUR19.2 millio loss) using the remaining proceeds from the depleted reserve fund. TDA CAM 10: S&P Lowers Ratings on Three Note Classes to 'BB+' ------------------------------------------------------------- Standard & Poor's Ratings Services lowered to 'BB+ (sf)' from 'AA- (sf)' and removed from CreditWatch negative its credit ratings on TDA CAM 10, Fondo de Titulizacion de Activos' class A2, A3, and A4 notes. At the same time, S&P has affirmed its 'CCC- (sf)' rating on the class B notes and its 'D (sf)' ratings on the class C and D notes. The transaction's performance has deteriorated since S&P's last review on Feb. 8, 2012. The level of 90+ days arrears has increased to 7.49% in March 2013, from 5.57% a year before. In addition to this increase, delinquencies have rolled over into defaults. As a result, the level of defaults over the outstanding balance of the assets is 6.37%, compared with 5.07% a year before. S&P expects this rollover into defaults to continue eroding the credit enhancement, as all of the mechanisms put in place to protect the senior notes have now been breached. These notes are now directly exposed to the portfolio's potential defaults. The swap counterparty, Cecabank S.A. (BB+/Negative/B), has not been replaced after breaching a rating trigger under the transaction documents in April 2012. The swap documents reflect S&P's 2012 counterparty criteria and establish that upon the loss of a 'BBB+' long-term issuer credit rating (ICR), the swap counterparty should be replaced. According to S&P's 2012 counterparty criteria, it links its ratings on the notes to its long-term ICR on the swap counterparty as without the support of the swap, given the assets' deteriorating performance, the notes would achieve lower ratings. S&P has therefore lowered to 'BB+ (sf)' from 'AA- (sf)' and removed from CreditWatch negative its ratings on the class A2, A3, and A4 notes. At the same time, S&P has affirmed its 'CCC- (sf)' rating on the class B notes and its 'D (sf)' ratings on the class C and D notes. TDA CAM 10 closed in December 2007 and securitizes residential mortgage loans granted to individuals to purchase a property. Banco CAM, which has merged with Banco de Sabadell S.A., is the originator of the transaction. STANDARD & POOR'S 17G-7 DISCLOSURE REPORT SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an residential mortgage-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this credit rating report is available at: http://standardandpoorsdisclosure-17g7.com RATINGS LIST Class Rating To From TDA CAM 10, Fondo de Titulizacion de Activos EUR1.424 Billion Residential Mortgage-Backed Floating-Rate Notes Ratings Lowered And Removed From CreditWatch Negative A2 BB+ (sf) AA- (sf)/Watch Neg A3 BB+ (sf) AA- (sf)/Watch Neg A4 BB+ (sf) AA- (sf)/Watch Neg Ratings Affirmed B CCC- (sf) C D (sf) D D (sf) =========== S W E D E N =========== NORTHLAND RESOURCES: Distributes Reorganization Plan to Creditors ----------------------------------------------------------------- Northland Resources S.A. disclosed that the Reorganization Plan regarding Northland Sweden AB, Northland Resources AB, Northland Logistics AB, and Northland Logistics AS was set to be distributed to all the creditors of the companies via mail on June 19. On June 19, the companies also filed a request for composition proceedings to Lulea District Court. The Reorganization Plan and the request for composition proceedings are available at Northland's web site, http://www.northland.eu About Northland Northland is a producer of iron ore concentrate, with a portfolio of production, development and exploration mines and projects in northern Sweden and Finland. The first construction phase of the Kaunisvaara project is complete and production ramp-up started in November 2012. The Company expects to produce high-grade, high- quality magnetite iron concentrate in Kaunisvaara, Sweden, where the Company expects to exploit two magnetite iron ore deposits, Tapuli and Sahavaara. Northland has entered into off-take contracts with three partners for the entire production from the Kaunisvaara project over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study for its Hannukainen Iron Oxide Copper Gold project in Kolari, northern Finland and for the Pellivuoma deposit, which is located 15 km from the Kaunisvaara processing plant. * * * As reported by the Troubled Company Reporter-Europe on April 1, 2013, Moody's Investors Service affirmed the Caa3 corporate family rating and bond rating of Northland Resources AB. Concurrently, Moody's has applied the 'limited default' ('/LD') indicator to the company's Ca-PD probability of default rating (PDR), to reflect the recently missed interest payment on its outstanding notes, which the rating agency considers a default according to its definition of default. As a result, Moody's PDR for Northland has been affirmed at Ca-PD/LD. In addition, the outlook on all ratings remains negative. SAAB AUTOMOBILE: Spyker Mulls New Court Action v. GM Over Sale -------------------------------------------------------------- BBC News reports that Spyker Cars, owner of Saab Automobile, plans new court action against General Motors which it claims lost it US$3 billion (GBP1.95 billion) by blocking the sale of the Swedish carmaker. Spyker bought Saab from GM in 2010 and kept the right to use the US carmaker's technology to build vehicles, BBC recounts. It wanted to sell Saab to a Chinese firm in 2011, but GM blocked it, saying the sale would forfeit that right, BBC notes. A judge threw out Spyker's previous case last year against the US giant, BBC relates. Spyker's claim has been that the deal was blocked by GM because it did not want competition in China, and that GM's blocking tactics caused Saab to collapse, BBC states. GM said at the time of the previous court case that Spyker bought Saab knowing its financial history, pointing out that Saab had granted it a contractual right to agree, or not, to the transaction and that those terms had been spelled out, BBC recounts. At the time GM called the allegations "baseless", BBC notes. According to BBC, Saab was already in a fragile state when Spyker bought it out from GM, eventually filing for bankruptcy at the end of 2011. A last attempt to raise money from China's Youngman group was blocked by GM because of the dispute over the transfer of technology, BBC discloses. GM first bought a 50% stake and management control of Saab in 1989, then gained full ownership in 2000, BBC notes. About Saab Automobile AB and Saab Cars N.A. Saab Automobile AB is a Swedish car manufacturer owned by Dutch automobile manufacturer Swedish Automobile NV, formerly Spyker Cars NV. Saab halted production in March 2011 when it ran out of cash to pay its component providers. On Dec. 19, 2011, Saab Automobile AB, Saab Automobile Tools AB and Saab Powertain AB filed for bankruptcy after running out of cash. Some of Saab's assets were sold to National Electric Vehicle Sweden AB, a Chinese-Japanese backed start-up that plans to make an electric car using Saab Automobile's former factory, tools and designs. On Jan. 30, 2012, more than 40 U.S.-based Saab dealerships filed an involuntary Chapter 11 petition for Saab Cars North America, Inc. (Bankr. D. Del. Case No. 12-10344). The petitioners, represented by Wilk Auslander LLP, assert claims totaling US$1.2 million on account of "unpaid warranty and incentive reimbursement and related obligations" or "parts and warranty reimbursement." Leonard A. Bellavia, Esq., at Bellavia Gentile & Associates, in New York, signed the Chapter 11 petition on behalf of the dealers. The dealers want the vehicle inventory and the parts business to be sold, free of liens from Ally Financial Inc. and Caterpillar Inc., and "to have an appropriate forum to address the claims of the dealers," Leonard A. Bellavia said in an e-mail to Bloomberg News. Saab Cars N.A. is the U.S. sales and distribution unit of Swedish car maker Saab Automobile AB. Saab Cars N.A. named in December an outside administrator, McTevia & Associates, to run the company as part of a plan to avoid immediate liquidation following its parent company's bankruptcy filing. On Feb. 24, 2012, the Court granted Saab Cars NA relief under Chapter 11 of the Bankruptcy Code. Donlin, Recano & Company, Inc., was retained as claims and noticing agent to Saab Cars NA in the Chapter 11 case. On March 9, 2012, the U.S. Trustee formed an official Committee of Unsecured Creditors and appointed these members: Peter Mueller Inc., IFS Vehicle Distributors, Countryside Volkwagen, Saab of North Olmstead, Saab of Bedford, Whitcomb Motors Inc., and Delaware Motor Sales, Inc. The Committee tapped Wilk Auslander LLP as general bankruptcy counsel, and Polsinelli Shughart as its Delaware counsel. ============= U K R A I N E ============= METINVEST BV: Fitch Affirms 'B' Long-Term Foreign Currency IDR -------------------------------------------------------------- Fitch Ratings has affirmed Ukrainian-based METINVEST B.V.'s Long- Term foreign currency Issuer Default Rating (IDR) at 'B'. The senior unsecured rating on the company's 2015 and 2018 Eurobonds has also been affirmed at 'B'/'RR4'. The Outlook on the Long-Term IDR is Stable. The ratings continue to be supported by Metinvest's position as a leading integrated low-cost steel and iron ore producer in Ukraine. Fitch notes that FY12 was a challenging year for steel producers globally, with Metinvest's EBITDA margin contracting to 15.2%, well down from 26.4% in FY11. Despite volatile demand conditions and strong pressure on commodity prices, the company managed to maintain a stable financial profile. Over the medium- term, Metinvest's credit metrics are expected to remain in line with the assigned ratings given the company market leading position and solid operating profile. KEY RATING DRIVERS - Ratings Constrained by Sovereign: Metinvest's Long-term foreign currency IDR remains constrained by Ukraine's sovereign ratings (Long-Term foreign and local currency IDR 'B'/Stable), given the company's exposure to Ukraine for raw materials, the location of its major plants and the size of Ukraine as a significant end-market for its products. Absent the Sovereign constraint Fitch continues to view Metinvest's stand- alone rating at 'BB-'. - Low-Cost Producer: Metinvest's ratings reflect its scale as one of the largest Commonwealth of Independent States' (CIS) producers of steel and iron ore, with domestic sales at 26% of total revenue, a low-cost production base and more than 100% self-sufficiency in iron ore and 65% in coking coal. The ratings also factor in Metinvest's close proximity to raw material sources, Black Sea ports and key end markets. - Weaker Steel Market Conditions: Fitch expects Metinvest's financial metrics to remain under pressure in 2013 despite lower leverage year on year. Funds from operations (FFO) gross leverage is expected to decrease to around 2.5x for FYE 2013 based on a return to positive free cash flow (FCF) generation, from 3.2x at end-2012. EBITDA margins are expected to contract to between 12%-13% from 15.2% in 2012, on the back of moderately weaker steel demand/prices and lower average iron ore prices. RATING SENSITIVITIES: Positive: Future developments that could lead to positive rating actions include: - Change in Sovereign Rating: The ratings would be adjusted in the event of a change in the Ukrainian sovereign rating. The ratings could be upgraded if Metinvest's reliance on Ukraine materially declined, although this is not expected over the rating horizon. Such action would be considered in combination with maintenance of a sound credit profile including FFO gross leverage below 2.5x over the medium term, and expectations for positive FCF on average. Negative: Future developments that could lead to negative rating action include: - Financial Profile: Negative rating action could result from a sustained weakening of the company's financial profile as shown by FFO gross leverage above 2.5x and/or an EBIT margin below 6% on a sustained basis. The rating actions are: -- Long-Term foreign currency IDR: affirmed at 'B', Outlook Stable -- Short-Term foreign and local currency IDR: affirmed at 'B' -- Senior Unsecured foreign currency rating: affirmed at 'B' (RR4) -- Long-Term local currency IDR: affirmed at 'B+', Outlook Stable -- Short-Term local currency IDR: affirmed at 'B' -- National Long-Term Rating: affirmed at 'AA+(UKR)', Outlook Stable -- National Short-Term Rating: affirmed at 'F1+(UKR)' =========================== U N I T E D K I N G D O M =========================== CO-OPERATIVE BANK: Unlikely to Claw Back Money From Former Head --------------------------------------------------------------- James Quinn at The Telegraph reports that the Co-operative Group is unlikely to be able to claw back any money from the former chief executive, Peter Marks, or the former bank head, Neville Richardson, despite the revelation that the bank had a GBP1.5 billion capital shortfall and bondholders would have to take a loss. Senior sources have indicated that because of the mutual's complicated structure, it is highly unlikely that either man will be affected by the investigation into possible clawbacks the Co- op is undertaking, the Telegraph notes. The news is likely to irritate bondholders in the Co-op Bank asked to take haircuts on their investments, the Telegraph says. The bank earlier said its bonds would be "bailed in" to help fill part of the shortfall, in a complex transaction which will see part of the bank list on the London Stock Exchange, the Telegraph relates. The GBP1.5 billion capital "black hole" was the result of Co-op's merger with Britannia Building Society in 2008, and in particular commercial real estate loans written by Britannia, the Telegraph notes. Mr. Marks oversaw the merger, and Mr. Richardson, who left the Co-op in 2011, ran the combined banking business having originally run Britannia, the Telegraph discloses. Mr. Marks sat on the board of the Co-op Bank but was actually paid by the group, the Telegraph states. When he left in May he did so without a pay-off, and without a sizeable Co-op pension pot as the result of an earlier decision to have his pension contributions paid as an allowance in lieu of pension provision, the Telegraph notes. Mr. Richardson resigned in July 2011 with a GBP4.6 million pay- off, the Telegraph relates. It is thought the Co-op has no rights to these funds, the Telegraph says. According to the Telegraph, a Co-op spokesman said the board was mindful of its obligations, but the subject of clawbacks was for the bank remuneration committee. Co-op Bank -- part of the mutually owned food-to-funerals conglomerate Co-operative Group -- traces its history back to 1872. The bank gained prominence for specializing in ethical investment. It refuses to lend to companies that test their products on animals, and its headquarters in Manchester is powered by rapeseed oil grown on Co-operative Group farms. Founded in 1863, the Co-op Group has more than six million members, employs more than 100,000 people and has turnover of more than GBP13 billion. * * * As reported by the Troubled Company Reporter-Europe on May 13, 2013, Moody's Investors Service downgraded the deposit and senior debt ratings of Co-operative Bank plc to Ba3/Not Prime from A3/Prime 2, following its lowering of the bank's baseline credit assessment (BCA) to b1 from baa1. The equivalent standalone bank financial strength rating (BFSR) is now E+ from C- previously. CO-OPERATIVE BANK: Fitch Cuts LT Issuer Default Rating to 'BB-' --------------------------------------------------------------- Fitch Ratings has downgraded The Co-operative Bank PLC's (CB) Long-term Issuer Default Rating (IDR) to 'BB-' from 'BBB-', Short-term IDR to 'B' from 'F3' and Viability Rating to 'bb-' from 'bbb-'. The Long-term IDR and VR have been placed on Rating Watch Evolving (RWE). The bank's Support Rating has been downgraded to '5' from '3'and its Support Rating Floor revised to 'No Floor' ('NF') from 'BB+'. Fitch has also downgraded the bank's long-term senior debt to 'BB-' from 'BBB-' and placed it on RWE, and downgraded its subordinated debt ratings to 'CC' from 'BB+' (Lower Tier 2) and 'BB-' (Upper Tier 2) and placed them on RWE. The rating impact, if any, from the rating actions on the bank's covered bonds will be detailed in a separate comment. KEY RATING DRIVERS - IDRS, VR AND SENIOR DEBT The downgrade of CB's IDRs and VR reflects Fitch's concerns that the bank's capital requirements are greater than originally anticipated. CB has indicated that it requires GBP1.5 billion of additional capital. This is sizeable in relation to the bank's reported equity. CB's recapitalization plan includes an injection of capital from its parent and a liability management exercise. Full details of the liability management exercise have not yet been disclosed but Fitch's understanding is that an exchange offer to junior subordinated bondholders will result in GBP1 billion of additional common equity Tier 1 (CET1) capital by end- 2013. A further GBP500 million of CET1 capital will be injected by the Co-operative Group in 2014, conditional on the exchange offer becoming effective. The Prudential Regulation Authority has stated that the need for higher capital reflects expected future losses and an assessment of the future cost of conduct redress. CB has indicated that the targeted fully-loaded Basel III CET1 ratio is at least 9% at end- 2013 and to increase in the following years. The downgrade of the IDRs and VR also considers Fitch's view that the bank's franchise is likely to have been damaged given negative sentiment surrounding the bank since April 2013. There are signs that confidence among some depositors and investors may be weakening and execution risks associated with new management's objective of addressing the various operational challenges within the bank present a considerable challenge. RATING SENSITIVITIES - IDRS, VR AND SENIOR DEBT The ratings have been placed on RWE, indicating on the downside the presence of execution risks in the recapitalization plan but also upside ratings potential if the plan is achieved. Various corporate and investor agreements need to be put in place before the plan can proceed. Furthermore, the exact details of the plan have not yet been announced. Depending on the outcome of the liability management exercise and the amount of fresh equity received by the bank, as well as impact of the lower debt servicing costs, the bank's IDRs, VRs and senior debt may be upgraded. If the plan is implemented as outlined, Fitch considers that the outcome should be positive for senior debt holders. The RWE would result in an upgrade if CB can raise the full amount of capital targeted and stabilize its franchise combined with new management setting down a sustainable, credible longer-term strategic plan. CB's IDRs, VRs and senior debt may be downgraded further if regulators require additional actions, if the market uptake of the planned debt for equity exchange offer is lower than expected or if the plan to recapitalize the bank to an acceptable level within an acceptable time frame fails. KEY RATING DRIVERS - SUBORDINATED DEBT AND OTHER HYBRID SECURITIES CB's Upper and Lower Tier 2 Instruments (subordinated debt) have been downgraded to 'CC'/RWE from 'BB+' and 'BB-', respectively. The downgrade reflects the plan to redeem these bonds at rates below par value and to exchange them into a combination of bank shares and Cooperative Group debt. As a result, these bondholders are expected to suffer losses. Fitch considers that sufficient pressure exists for most junior debt holders to accept the offer and thus avoid more adverse consequences in the event that they do not take up the offer. Given the outline terms of the offer, Fitch considers this constitutes a distressed debt exchange on those securities under its criteria. RATING SENSITIVITIES - SUBORDINATED DEBT AND OTHER HYBRID SECURITIES The ratings of the Upper and Lower Tier 2 Instruments could be downgraded further or upgraded by one notch once additional details of the exchange are announced. At that time, Fitch will be in a position to undertake a meaningful assessment of recoverability. KEY RATING DRIVERS - SUPPORT RATING AND SUPPORT RATING FLOOR The downgrade of the bank's Support Rating and revision of the Support Rating Floor is consistent with Fitch's view of a clear political intention to ultimately reduce implicit support for banks in the UK. In addition, Fitch believes CB's systemic importance is reducing given the scaling back of the bank's scope and ambition. Fitch considers CB to be more of a niche player, positioned as an alternative to the UK's major banks. The rating actions are: -- Long-term IDR downgraded to 'BB-' from 'BBB-'; placed on RWE -- Short-term IDR downgraded to 'B' from 'F3' -- Viability Rating: downgraded to 'bb-' from 'bbb-'; placed on RWE -- Support Rating: downgraded to '5' from '3' -- Support Rating Floor: revised to 'NF' from 'BB+' -- Senior unsecured notes Long-term rating: downgraded to 'BB-' from 'BBB-'; placed on RWE -- Senior unsecured notes Short-term rating: downgraded to 'B' from 'F3' -- Lower Tier 2 subordinated notes: downgraded to 'CC' from 'BB+'; placed on RWE -- Upper Tier 2 subordinated notes: downgraded to 'CC' from 'BB-'; placed on RWE CO-OPERATIVE BANK: DBRS Cuts Subordinated Debt Rating to 'CC' ------------------------------------------------------------- DBRS Ratings Limited has downgraded the ratings of The Co-operative Bank plc. The Bank's Long-Term debt and deposit ratings have been downgraded to BBB (low), from BBB (high), and the Short-Term debt and deposit ratings have been downgraded to R-2 (middle) from R-1 (low). The dated subordinated debt of the bank has been downgraded to CC from BBB (low) and the Perpetual subordinated bonds have been downgraded to CC from BB (high). All of the ratings remain Under Review with Negative Implications. The Intrinsic Assessment for the bank is now BBB (low). DBRS has also changed its Support Assessment for the Bank to SA3 from SA2 and therefore the Bank's Long-Term debt and deposit ratings are no longer positioned above the Intrinsic Assessment. The rating action follows the June 17, 2013 announcement by The Co-operative Group (Group) and the Bank that the Bank requires an additional GBP 1.5 billion of equity capital. The Bank plans to raise approximately GBP 1 billion in 2013 through an exchange offer to holders of the Bank's dated subordinated debt, Perpetual subordinated bonds, and non-cumulative preference shares (unrated). In addition a further GBP 500 million is to be raised in 2014 through the sale of the Group's life assurance and asset management business, and its general insurance business, as well as through a cost saving programme at the bank and through the deleveraging of the bank's non-core assets, including potentially asset sales. Although full details on the exchange offer will not be known until October 2013 the Bank has announced that subordinated bondholders will be offered an exchange into a mixture of senior debt issued by the Group (and potentially also a fixed income instrument issued by the Bank dependent on take- up) and equity in the Bank. As a result of this, a minority equity stake in the Bank will be listed. Given the magnitude of the capital requirement DBRS expects that some form of coercion will be required to ensure that the required take-up of the offer is achieved. DBRS also highlights that the proposal has broader negative implications for bank creditors as it is not in line with the normal creditor hierarchy that would see equity being wiped out before subordinated debt holders are required to take a loss. The downgrade of the Bank's senior rating and intrinsic assessment to BBB (low) reflects the strategic challenges facing the bank and its new management team, including the listing of a minority stake in the bank, the potential damage to the franchise as a result of the capital issues and the exit from certain corporate business, and the continuing need to finalise the integration of Britannia. Additionally DBRS expects the bank to report another substantial loss in 2013 as a result of the deterioration in asset quality, especially within the Bank's commercial real estate loan portfolio. Downward pressure on the senior ratings is mitigated to a certain degree by the capital that is proposed to be raised by the Bank through the exchange offer and the support from the Group. However, if the exchange offer is not successful and the capital not raised, then it is likely that a further multi-notch downgrade would result. The ratings also take into account the Bank's relatively solid, albeit limited, customer franchise and the strength of its funding profile. DBRS considers that the Bank's core operations, which have remained marginally profitable, can support the Bank in its eventual return to profitability. The UK banking system is dominated by a small number of large banks and DBRS notes that there is a desire on the part of the authorities and other parties to promote competition by encouraging smaller banks such as The Co-operative. Nevertheless, the change in the Support Assessment to SA3 from SA2 reflects DBRS's view that the likelihood of the UK Government stepping in to provide support which would benefit the senior bondholders of a mid-sized bank such as the Co-operative Bank is low, and indeed the example of the Co-operative provides further evidence that the authorities in the UK look to bail-in subordinated debt when capitalisation is weak. As a result of the likely coercive nature of the exchange offer and DBRS's expectation of substantial losses for bondholders the dated subordinated debt and the Perpetual subordinated bonds have been downgraded to CC and remain Under Review with Negative Implications until full details on the exchange are known. A further downgrade of these instruments to D is likely if, when the exchange offer details are available, DBRS is of the opinion that the exchange offer is coercive. DBRS has widened the notching on these instruments beyond the standard notching discussed in our published methodologies due to the high likelihood that substantial losses will be borne by the bondholders. All of the Bank's ratings remain Under Review with Negative Implications. The review will focus on the outcome of the exchange offer as well as the medium-term business plan that will be presented by the new management team in August. In addition with regard to the subordinated debt instruments the review will also focus on the full details of the exchange offer. COGGLES: Hut Group Buys Firm Out of Administration -------------------------------------------------- MPDClick reports that online retailer the Hut Group has acquired premium fashion retailer Coggles out of administration. The report recalls that Coggles went into administration in May after various failed attempts to restructure. "Our primary duty is to bring about the optimum return for creditors and the offer from the Hut Group was an extremely good deal," the report quoted Andy Clay -- andy.clay@begbies-traynor.com -- of Begbies Traynor as saying. The report notes that joint administrators have completed a deal for the Hut Group to take some of Coggles' assets, including stock and all intellectual property such as the brand and the company's domain names. The report relates that following the deal, the Hut Group will take the ailing retailer online, as part of its prestige division. "Whil[e] it is sad to see Coggles disappearing from the high street for the time being, and the loss of employment for the remaining staff, it is positive that the business will continue as part of a large and successful specialist online retail group," summarized Mr. Clay after the news broke on June 18. Coggles is a York-based upscale fashion chain. COUNTYROUTE PLC: S&P Affirms 'B+' Sr. Secured Bank Loan Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised upward to '1' from '3' its recovery rating on the GBP88 million senior secured bank loan due 2026 and issued by U.K.-based concessionaire CountyRoute (A130) PLC. A recovery rating of '1' indicates S&P's expectation of very high (90%-10%) recovery prospects in the event of a payment default. At the same time, S&P affirmed its 'B+' long-term issue rating on the senior secured bank loan. The outlook on the loan is negative. In addition, S&P revised upward to '1' from '6' its recovery rating on the GBP5.5 million subordinated secured mezzanine bank loan due 2026 and issued by CountyRoute. S&P is keeping its 'B-' long-term issue rating on the subordinated secured mezzanine loan on CreditWatch, where it was placed with negative implications on Jan. 11, 2013. The upward revision of the recovery ratings on CountyRoute's debt is the result of a change to S&P's recovery analysis to reflect its updated base-case assumptions for projected performance. For the purpose of S&P's recovery analysis, it assumes an event of default in 2023, reflecting the point of weakest project liquidity in its base case. The hypothetical default date follows a peak S&P currently expects in future major maintenance expenditure and is closer to the debt maturity date, and therefore reflects lower outstanding amounts of debt. Consequently, the projected recovery prospects have improved. "Our updated base case incorporates flat traffic volumes for financial 2014 (ending March 31, 2014), followed by a recovery in financial 2015. This is followed by steady overall growth in total traffic volumes of 1.0%-1.5% thereafter. This compares with CountyRoute's current forecasts of more than 2.0% growth each year until financial 2016, followed by 1.5% thereafter. Our base case also incorporates the latest information we have for CountyRoute's forecast major maintenance amounts," S&P said. "However, we note that CountyRoute's assumptions for both future traffic volume growth and major maintenance costs are under review. In our view, the review could result in an upward revision of future major maintenance expenditure, which would be negative both for the project's annual debt service coverage ratios (ADSCRs) and its liquidity. We will update our own base case following the outcome of this review, which we currently anticipate will conclude in September this year," S&P noted. The negative outlook on the senior secured debt rating reflects S&P's view of the potential effect of an upward revision of future major maintenance expenditure, and the current weak growth trends in traffic volume on the road. S&P could lower the rating if the amount of major maintenance expenditure forecast is higher than currently indicated, resulting in a further decline in the project's forecast ADSCRs and liquidity. A similar outcome could result if the future development of traffic volumes is worse than S&P anticipates. S&P could take a positive rating action if the forecast financial profile of the project were to improve. This could occur, for example, if the original construction contractor were to accept partial or full responsibility for the rectification of underlying road defects, or if traffic volumes were to grow faster than S&P forecasts. However, S&P currently views such a situation as less likely. The ongoing CreditWatch negative placement on the subordinated debt rating reflects S&P's view of the potential for a lock-up on future payments resulting from a requirement to fund future major maintenance expenditure, or from continued traffic underperformance. S&P would lower the subordinated debt rating, potentially by more than one notch, if CountyRoute's updated projected ADSCRs indicate an increased likelihood of a payment lock-up, or should the current weak traffic volume growth persist. Alternatively, S&P could remove from CreditWatch and affirm the subordinated debt rating if the updated forecast ADSCRs and liquidity remain substantially in line with its projections. S&P expects to resolve the CreditWatch placement following the completion of CountyRoute's review of its assumptions for both future traffic volume growth and major maintenance costs, which S&P currently expects in September this year. DUNFERMLINE FC: Preferred Bidder to Be Identified This Week ----------------------------------------------------------- BBC Sport reports that Dunfermline administrator Bryan Jackson hopes to have a preferred bidder for the club by the middle of this week. Fans' group Pars United are vying to take over the ailing Fife outfit, along with another anonymous party, BBC Sport notes. "I've got meetings with both interested parties to go through the conditions, some of which are not acceptable," Mr. Jackson told BBC Scotland. "We really have to identify one quickly because we have a provisional date for our CVA meeting on July 12." Mr. Jackson's firm BDO decided to proceed with the offer of a company voluntary arrangement following a meeting with the club's creditors, BBC Sport relates. But, to complicate matters, the company which controls East End Park stadium is also in the hands of administrators, BBC Sport states. "The added complication we have is the administrator for East End Park will have to be happy with who we want to go with," BBC Sport quotes Mr. Jackson as saying. "There is no point in getting the stadium but not the club and vice versa." According to BBC Sport, Pars United's fund-raising campaign has been widely publicized, while the rival offer remains shrouded in mystery, with Mr. Jackson admitting that their proof of funding "has not yet been fully evidenced". However, he did add "our feeling is that both parties are credible bidders". Dunfermline Athletic Football Club is a Scottish football team based in Dunfermline, Fife, commonly known as just Dunfermline. EQUIDEBT: In Administration, Cuts 60 Jobs ----------------------------------------- Stratford Herald reports that Equidebt has suffered the ultimate embarrassment for a business of its type -- financial failure. Equidebt went into administration with the immediate loss of 60 jobs and the remaining small number of staff also facing the prospect of redundancy, according to Stratford Herald. The report relates that in a stroke of ill fortune, it would normally associate with the people it has spent its time chasing for cash, the company now finds itself in the hands of administrators Ernst & Young. Equidebt is a debt collection company based in Wellesbourne. HEARTS FC: Morisons And HBJ Gateley Lead Advice On Administration -------------------------------------------------------------- Hannah Gannage-Stewart at The Lawyer reports that Morisons Solicitors and HBJ Gateley have been appointed to advise on the administration of Edinburgh football club Heart of Midlothian Football Club. A notice was lodged to put the club into administration June 19 after wrangling between Lithuanian parent company UBIG, which was pushing for BDO administrators to be appointed, and the club's management, which preferred KPMG, according to The Lawyer. The report relates that BDO partner trio Bryan Jackson, James Stephen and Trevor Birch were ultimately appointed to handle the case. They are being advised by Edinburgh and Glasgow firm Morisons, which has fielded a team led by Glasgow-based corporate partner Peter Duff -- peter.duff@morisonsllp.com -- with assistance from solicitor Keith Anderson -- Keith.Anderson@morisonsllp.com HBJ Gateley is acting for the club's management, with a team led by Edinburgh insolvency and disputes partner Simon Catto -- SCatto@hbjgateley.com Baltic firm Tark Grunte Sutkiene, the report adds, is also advising the administrators, led by Vilnius insolvency partner Vidmantas Drizga -- vidmantas.drizga@tgslegal.com -- with associate partner Deimante Korsaite -- deimante.korsakaite@tgslegal.com NEW LOOK: Fitch Assigns 'B' Rating to GBP808MM Sr. Secured Notes ---------------------------------------------------------------- Fitch Ratings has assigned New Look Retail Group Limited's (New Look; 'B-'/Stable) GBP808 million senior secured notes issued by New Look Bondco I plc a final 'B' rating with a Recovery Rating of 'RR3'. The rating action follows the review of final terms of the bond issue principally conforming to information already received by Fitch. As expected, the proceeds have been used to repay all indebtedness under the previous senior facilities agreement and mezzanine facility agreement, in addition to funding the cash tender of approximately half of the previously outstanding PIK loans. In conjunction with the tender offer, New Look will exchange the remaining PIK liabilities for a new PIK loan facility issued through a special purpose vehicle located within the restricted group that matures in November 2018. The new notes rank as senior secured obligations and benefit from guarantees from certain operating subsidiaries representing over 97% of the restricted group's adjusted EBITDA. New Look's 'B-' IDR reflects the aggressiveness of the proposed recapitalization. However, this is offset by its established market leadership in the UK, favorable medium-term industry trends and improving operating performance in recent quarters. From a business risk standpoint, Fitch views New Look as possessing a number of company-specific traits consistent with a higher rating. However, the company's financial profile and limited expected de-leveraging potential, are more in line with a low-rated 'B' issuer and are viewed as constraining factors for New Look's ratings. Key Rating Drivers Established Market Position Fitch considers New Look's high fashion content and value proposition as differentiating factors compared with its immediate peer group. This has resulted in a strong brand position in the UK value clothing segment, which is benefiting from a long-term structural change, largely driven by increased acceptance of value retail brands. New Look is further supported by the multi-channel offering comprising over 1,100 owned and franchised stores worldwide (590 owned stores in the UK) and a fast-growing e-commerce and mobile-commerce presence. These company-specific traits justify a high 'B'/low 'BB' rating category but the rating is constrained by the company's reliance on the UK market. E-Commerce Expansion New Look aims to improve EBITDA back to the previous highs of FY10. However, the mix of EBITDA is fundamentally different with the share of UK retail profit expected to contribute a lower percentage of overall group EBITDA in the coming years with the e-commerce division generating an increasing percentage of growth in group EBITDA from FY13. Fitch views management's growth assumption as reasonable based on current trends and results achieved in recent periods. More broadly, these expectations are consistent with industry trends as online retailing is expected to grow at 15.1% (CAGR) from 2012 to 2016. Subdued UK Consumer Environment Although New Look plans to increase its overseas exposure, its UK division remains a major part of its business, contributing 78% of group revenue and 93% of group underlying operating profit in FY13. The UK consumer environment remains subdued as unemployment is still high, household incomes remain squeezed and the real wage continues to fall. As a result, competition among clothing retailers is very high with promotions and discounting being the new norm in the industry. Improving Operating Performance Despite the strong brand franchise, operating performance in recent years has been affected by several factors, both internal and external. This includes a one-off event with the departure of 40% of its key buyers when New Look moved its headquarters from Weymouth to London. As a result, there was inconsistent ranging, pricing and quality in its products, which led to increased markdowns and depressed profitability in FY11 and FY12. The poor operating performance has since reversed, as evidenced by a 29% year-on-year improvement in reported adjusted EBITDA in FY13. Fitch expects the UK retail sector to remain under pressure driven by weak consumer confidence and above-average supply chain inflation. In FY13, New Look reported sales increased by 2.5% (FY12: -0.9%) and EBITDA margin improved to 12.7% (FY12: 9.6%). Further gradual improvement in profitability is factored in thereafter. Aggressive Financial Profile Fitch characterizes New Look's financial profile as aggressive. This is prompted by the partial refinancing of the old Holdco PIK loan with additional debt issued at the same restricted group as the issued senior secured notes, which justifies the 'B-' IDR despite the extended debt maturity profile. In addition, Fitch has included the new PIK facility in its calculation of leverage metrics. Several characteristics that support this approach include guarantees from operating subsidiaries within the restricted group, option to pay interest in cash and transferability of rights and obligations. Fitch projects FFO- adjusted net leverage to increase to around 7.1x (cash-pay FFO- adjusted net leverage of 6.0x) by FYE14 (March 2014). In Fitch's definition of FFO-adjusted net leverage (including PIK), this is weak relative to the 'B' median for the sector at 6.0x. FFO fixed charge cover (including cash interest and rents) is equally considered weak at 1.5x. Senior Secured Notes' Rating The 'B'/'RR3' senior secured rating reflects Fitch's expectations that the enterprise value of the company -- and resulting recovery for its creditors -- will be maximized in a restructuring (going concern approach) rather than a liquidation due to the relatively asset-light nature of the business. Furthermore, a default scenario would likely be triggered by unsustainable financial leverage, possibly as a result of increasingly weak consumer spending or poor acceptance of the company's product roll-outs. As such, Fitch has applied a 25% discount to FY13 EBITDA and believes a distressed multiple of 5.0x is appropriate. This results in above-average expected recoveries (51%-70%) for senior secured noteholders in the event of default. RATING SENSITIVITIES Positive: Future developments that may, individually or collectively, lead to a positive rating action include: - FFO-adjusted net leverage (including PIK) consistently below and expected to be sustained below 6.5x - FFO fixed charge cover (including cash interest and rents) consistently above 1.7x - 2.0x - EBITDA margins at or above 15% driven by core business improvement Negative: Future developments that may, individually or collectively, lead to a negative rating action include: - FFO-adjusted net leverage (including PIK) consistently above 8.5x - FFO fixed charge cover (including cash interest and rents) consistently below 1.2x - EBITDA margins below 10% - Inability to maintain positive free cash flow delaying deleveraging potential RBS CAPITAL: S&P Raises Rating on 3 Hybrid Instruments to 'BB+' --------------------------------------------------------------- Standard & Poor's Ratings Services said that it has raised to 'BB+' from 'C' the ratings on the three hybrid instruments issued by RBS Capital Funding Trust V, VI, and VII, after the announcement by The Royal Bank of Scotland Group PLC (the group) that coupon payments will resume on June 30, 2013. This follows the expiry of restrictions on coupon payments in April 2013, which the European Commission (EC) imposed on RBS N.V. The ratings on the notes reflect S&P's 'bbb' assessment of the stand-alone credit profile of RBS N.V., which it views as "core" to the group, as S&P's criteria defines this term. The ratings also reflect S&P's view that the notes: -- are subordinated, for which S&P deduct one notch; and -- are a gone concern or "non-viability contingent capital" instrument, for which S&P deducts a further notch. S&P rates the notes on the basis that cash flows from RBS N.V.-- as the operating entity -- service the debt and not on the guarantee from the non-operating holding company, RBS Holdings N.V. Therefore, S&P do not deduct a further notch for structural subordination. The 'BB+' rating is in line with S&P's ratings on Royal Bank of Scotland PLC hybrids. ROWERECORD ENGINEERING: Creditors Set to Lose GBP15 Million ----------------------------------------------------------- Kaleigh Watterson at Insider News Wales reports that creditors of Rowecord Engineering Ltd. are set to lose out on almost GBP15 million after the company fell into administration. The company entered administration on April 29 after suffering financial problems from disputes on contracts and overrunning engineering projects, Insider News Wales recounts. According to Insider News Wales, the company owes GBP23.7 million to its unsecured creditors. This includes GBP5.6 million to subcontractors, GBP5.4 million to trade creditors and GBP4.5 million in taxes, Insider News Wales notes. Employees are owed GBP2.9 million in redundancy pay, Insider News Wales says. They are also owed a further GBP316,000 in wages and holiday pay as preferential creditors, Insider News Wales states. Preferential creditors are expected to be repaid in full and there is set to be a dividend for unsecured creditors but the administrators currently estimate a GBP14.7 million deficiency, according to Insider News Wales. Newport-based Rowecord Engineering Ltd. is UK's third largest structural steel engineering company. VICTORY CHRISTIAN: Heads Into Receivership, Owes EUR18 Million -------------------------------------------------------------- Independent.ie reports the trustees of Victory Christian Fellowship are reeling from a tumultuous couple of weeks. The Victory Christian Fellowship went into receivership owing EUR18 million to Bank of Scotland, according to Independent.ie. The report relates that receivers sent in to take possession of the church's three prime properties were blocked by staff and some of the congregation. The report relates that when the trustees failed to show up in court to answer accusations that they had ignored court orders, a High Court judge gave directions to hunt them down. The report discloses that Brendan Hade, his elegant wife Sheila, and their friend, Gerry Byrne, narrowly escaped jail when they agreed to facilitate a peaceful handover of the church's three Dublin properties to the bank's receivers. This includes Kilmacud House in Stillorgan, 39 Westland Row and a state-of-the-art prayer center in Firhouse that was built five years ago, the report notes. The report says that the church has come under media scrutiny in the past for encouraging people to donate a tenth of their earnings to the church, and other money-generating schemes. =============== X X X X X X X X =============== * Euro-Zone Finance Ministers Agree on Bailout Fund Guidelines -------------------------------------------------------------- Stephen Fidler, Gabriele Steinhauser and Christopher Lawton at The Wall Street Journal report that euro-zone finance ministers agreed on guidelines Thursday for how their bailout fund could directly shore up failing banks in the bloc's weak economies. Euro-zone leaders pledged in June 2012 that they intended to break the destabilizing link between weak banks and governments with shaky finances by allowing their EUR500 billion (US$660 billion) rescue fund to directly inject capital into banks, rather than go through the host government, the Journal relates. This step would help "break the vicious circle between banks and sovereigns by diluting the link between them," the Journal quotes Olli Rehn, the European Union's economics commissioner, as saying. But the maximum amount ministers agreed to devote to the task was small compared with likely needs in a major banking crisis, the Journal notes. They agreed to limit such direct investments to EUR60 billion of the EUR500 billion fund, and would make any such capital injections through a special subsidiary, the Journal relates. They said they hoped to have the new facility in place by the second quarter of 2014 - in time for anticipated stress tests aimed at determining the strength of euro-zone banks, and before the European Central Bank starts supervising them, according to the Journal. Ministers also set strict conditions for allowing direct recapitalizations, the Journal says. National governments will remain solely responsible for raising a bank's capital buffer to the minimum set by bank regulators of 4.5% of bank assets, weighted according to risk, the Journal states. Even after that, a bank's home country will have to contribute at least 20% to any recapitalization through the fund, called the European Stability Mechanism, the Journal says. That amount will go down to 10% two years after the ESM gets the new instrument, the Journal discloses. The ministers left open the possibility that Thursday's decision could benefit euro-zone countries that have already used bailout loans to prop up troubled banks, the Journal notes. "It will have to be decided case-by-case and by mutual agreement," the Journal quotes Jeroen Dijsselbloem, who presides over the Eurogroup meetings, as saying. "It's up to the member states to apply for it." * BOND PRICING: For the Week June 17 to June 21, 2013 ----------------------------------------------------- Issuer Coupon Maturity Currency Price ------ ------ -------- -------- ----- AUSTRIA ------- A-TEC INDUSTRIES 8.750 10/27/2014 EUR 27.75 A-TEC INDUSTRIES 2.750 5/10/2014 EUR 29.13 IMMOFINANZ 4.250 3/8/2018 EUR 4.29 RAIFF CENTROBANK 8.907 7/24/2013 EUR 58.30 RAIFF CENTROBANK 8.588 1/23/2013 EUR 73.37 RAIFF CENTROBANK 7.965 1/23/2013 EUR 55.53 RAIFF CENTROBANK 7.873 1/23/2013 EUR 66.96 RAIFF CENTROBANK 7.646 1/23/2013 EUR 45.43 RAIFF CENTROBANK 5.097 1/23/2013 EUR 58.24 RAIFF CENTROBANK 8.417 1/22/2014 EUR 67.62 RAIFF CENTROBANK 7.122 1/22/2014 EUR 66.49 RAIFF CENTROBANK 11.134 7/24/2013 EUR 66.13 RAIFF CENTROBANK 9.200 7/24/2013 EUR 56.71 RAIFF CENTROBANK 9.304 1/23/2013 EUR 62.19 RAIFF CENTROBANK 9.876 1/23/2013 EUR 60.11 RAIFF CENTROBANK 9.558 1/23/2013 EUR 67.69 RAIFF CENTROBANK 8.920 1/23/2013 EUR 52.62 BELGIUM ------- ECONOCOM GROUP 4.000 6/1/2016 EUR 22.94 TALVIVAARA 4.000 12/16/2015 EUR 72.61 FRANCE ------ AIR FRANCE-KLM 4.970 4/1/2015 EUR 12.38 ALCATEL-LUCENT 5.000 1/1/2015 EUR 2.62 ALTRAN TECHNOLOG 6.720 1/1/2015 EUR 5.62 ASSYSTEM 4.000 1/1/2017 EUR 23.27 ATOS ORIGIN SA 2.500 1/1/2016 EUR 58.17 CAP GEMINI SOGET 3.500 1/1/2014 EUR 38.69 CGG VERITAS 1.750 1/1/2016 EUR 31.64 CLUB MEDITERRANE 6.110 11/1/2015 EUR 17.80 EURAZEO 6.250 6/10/2014 EUR 55.33 FAURECIA 3.250 1/1/2018 EUR 17.91 FAURECIA 4.500 1/1/2015 EUR 19.45 INGENICO 2.750 1/1/2017 EUR 48.14 MAUREL ET PROM 7.125 7/31/2015 EUR 17.13 MAUREL ET PROM 7.125 7/31/2014 EUR 18.15 NEXANS SA 2.500 1/1/2019 EUR 66.69 NEXANS SA 4.000 1/1/2016 EUR 56.09 ORPEA 3.875 1/1/2016 EUR 47.89 PEUGEOT SA 4.450 1/1/2016 EUR 23.56 PIERRE VACANCES 4.000 10/1/2015 EUR 73.63 PUBLICIS GROUPE 1.000 1/18/2018 EUR 54.06 SOC AIR FRANCE 2.750 4/1/2020 EUR 21.24 SOITEC 6.250 9/9/2014 EUR 7.25 TEM 4.250 1/1/2015 EUR 54.36 GERMANY ------- BNP EMIS-U.HANDE 9.750 12/28/2012 EUR 58.32 BNP EMIS-U.HANDE 10.500 12/28/2012 EUR 47.62 BNP EMIS-U.HANDE 9.500 12/31/2012 EUR 64.67 BNP EMIS-U.HANDE 7.750 12/31/2012 EUR 49.92 COMMERZBANK AG 6.000 12/27/2012 EUR 73.49 COMMERZBANK AG 7.000 12/27/2012 EUR 60.71 COMMERZBANK AG 13.000 12/28/2012 EUR 47.48 COMMERZBANK AG 16.750 1/3/2013 EUR 73.77 COMMERZBANK AG 8.400 12/30/2013 EUR 13.74 COMMERZBANK AG 8.000 12/27/2012 EUR 43.32 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 69.20 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 64.90 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 67.10 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 72.90 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 71.60 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 74.20 DEUTSCHE BANK AG 12.000 2/28/2013 EUR 75.00 DEUTSCHE BANK AG 11.000 4/2/2013 EUR 73.80 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 69.50 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 72.10 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 70.30 DEUTSCHE BANK AG 15.000 2/20/2013 EUR 68.00 DEUTSCHE BANK AG 11.000 1/18/2013 EUR 73.10 DEUTSCHE BANK AG 15.000 12/20/2012 EUR 62.10 DEUTSCHE BANK AG 12.000 12/20/2012 EUR 66.50 DEUTSCHE BANK AG 12.000 12/20/2012 EUR 41.90 DEUTSCHE BANK AG 12.000 12/20/2012 EUR 68.10 DEUTSCHE BANK AG 10.000 12/20/2012 EUR 74.90 DEUTSCHE BANK AG 10.000 12/20/2012 EUR 72.10 DEUTSCHE BANK AG 10.000 12/20/2012 EUR 63.00 DEUTSCHE BANK AG 9.000 12/20/2012 EUR 62.90 DEUTSCHE BANK AG 9.000 12/20/2012 EUR 73.40 DEUTSCHE BANK AG 8.000 12/20/2012 EUR 61.20 DEUTSCHE BANK AG 8.000 12/20/2012 EUR 70.40 DEUTSCHE BANK AG 8.000 12/20/2012 EUR 69.50 DEUTSCHE BANK AG 8.000 12/20/2012 EUR 38.60 DEUTSCHE BANK AG 7.000 12/20/2012 EUR 69.40 DEUTSCHE BANK AG 12.000 11/29/2012 EUR 65.20 DEUTSCHE BANK AG 9.000 11/29/2012 EUR 67.10 DEUTSCHE BANK AG 6.500 6/28/2013 EUR 53.50 DEUTSCHE BANK AG 12.000 4/2/2013 EUR 74.50 DEUTSCHE BANK AG 8.000 11/29/2012 EUR 71.50 DZ BANK AG 15.500 10/25/2013 EUR 71.05 DZ BANK AG 15.750 9/27/2013 EUR 74.86 DZ BANK AG 15.750 7/26/2013 EUR 71.21 DZ BANK AG 15.000 7/26/2013 EUR 75.00 DZ BANK AG 6.000 7/26/2013 EUR 69.50 DZ BANK AG 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12/31/2012 EUR 64.74 VONTOBEL FIN PRO 17.650 12/31/2012 EUR 73.18 VONTOBEL FIN PRO 10.300 3/22/2013 EUR 70.72 VONTOBEL FIN PRO 10.350 3/22/2013 EUR 73.54 VONTOBEL FIN PRO 10.750 3/22/2013 EUR 46.30 WGZ BANK 8.000 12/28/2012 EUR 59.08 WGZ BANK 8.000 12/21/2012 EUR 66.08 WGZ BANK 5.000 12/28/2012 EUR 73.18 WGZ BANK 6.000 12/28/2012 EUR 67.75 WGZ BANK 7.000 12/28/2012 EUR 63.10 WGZ BANK 6.000 12/21/2012 EUR 74.00 WGZ BANK 7.000 12/21/2012 EUR 68.47 GUERNSEY -------- BCV GUERNSEY 8.020 3/1/2013 EUR 56.54 BKB FINANCE 10.950 5/10/2013 CHF 62.57 BKB FINANCE 10.150 9/11/2013 CHF 73.89 BKB FINANCE 13.200 1/31/2013 CHF 50.08 BKB FINANCE 9.450 7/3/2013 CHF 68.52 BKB FINANCE 11.500 3/20/2013 CHF 59.30 BKB FINANCE 8.350 1/14/2013 CHF 54.15 EFG INTL FIN GUR 14.500 11/13/2012 EUR 73.04 EFG INTL FIN GUR 17.000 11/13/2012 EUR 64.12 EFG INTL FIN GUR 12.830 11/19/2012 CHF 70.07 EFG INTL FIN GUR 8.000 11/20/2012 CHF 62.03 EFG INTL FIN GUR 8.300 11/20/2012 CHF 64.99 EFG INTL FIN GUR 11.500 11/20/2012 EUR 55.05 EFG INTL FIN GUR 14.800 11/20/2012 EUR 65.84 EFG INTL FIN GUR 9.250 11/27/2012 CHF 68.70 EFG INTL FIN GUR 11.250 11/27/2012 CHF 64.89 EFG INTL FIN GUR 14.500 11/27/2012 CHF 31.64 EFG INTL FIN GUR 16.000 11/27/2012 EUR 59.21 EFG INTL FIN GUR 9.750 12/3/2012 CHF 72.96 EFG INTL FIN GUR 13.750 12/6/2012 CHF 35.12 EFG INTL FIN GUR 8.500 12/14/2012 CHF 58.17 EFG INTL FIN GUR 14.250 12/14/2012 EUR 66.29 EFG INTL FIN GUR 17.500 12/14/2012 EUR 62.97 EFG INTL FIN GUR 9.300 12/21/2012 CHF 64.50 EFG INTL FIN GUR 10.900 12/21/2012 CHF 64.73 EFG INTL FIN GUR 12.600 12/21/2012 CHF 64.81 EFG INTL FIN GUR 8.830 12/28/2012 USD 57.56 EFG INTL FIN GUR 10.000 1/9/2013 EUR 52.73 EFG INTL FIN GUR 9.000 1/15/2013 CHF 27.36 EFG INTL FIN GUR 10.250 1/15/2013 CHF 23.41 EFG INTL FIN GUR 11.250 1/15/2013 GBP 73.41 EFG INTL FIN GUR 12.500 1/15/2013 CHF 28.91 EFG INTL FIN GUR 13.000 1/15/2013 CHF 74.41 EFG INTL FIN GUR 16.500 1/18/2013 CHF 50.63 EFG INTL FIN GUR 5.800 1/23/2013 CHF 69.35 EFG INTL FIN GUR 19.050 2/20/2013 USD 74.67 EFG INTL FIN GUR 15.000 3/1/2013 CHF 71.34 EFG INTL FIN GUR 10.000 3/6/2013 USD 71.83 EFG INTL FIN GUR 12.250 12/27/2012 GBP 67.82 EFG INTL FIN GUR 8.000 4/2/2013 CHF 63.34 EFG INTL FIN GUR 16.000 4/4/2013 CHF 23.40 EFG INTL FIN GUR 7.530 4/16/2013 EUR 49.58 EFG INTL FIN GUR 7.000 4/19/2013 EUR 55.27 EFG INTL FIN GUR 12.000 4/26/2013 CHF 66.95 EFG INTL FIN GUR 9.500 4/30/2013 EUR 28.64 EFG INTL FIN GUR 14.200 6/7/2013 EUR 71.88 EFG INTL FIN GUR 6.500 8/27/2013 CHF 51.39 EFG INTL FIN GUR 8.400 9/30/2013 CHF 63.25 EFG INTL FIN GUR 19.000 10/3/2013 GBP 74.39 EFG INTL FIN GUR 8.160 4/25/2014 EUR 71.56 EFG INTL FIN GUR 5.850 10/14/2014 CHF 57.06 EFG INTL FIN GUR 6.000 11/12/2012 CHF 56.98 EFG INTL FIN GUR 6.000 11/12/2012 EUR 57.81 EFG INTL FIN GUR 10.500 11/13/2012 CHF 65.60 EFG INTL FIN GUR 10.500 11/13/2012 CHF 65.60 EFG INTL FIN GUR 12.750 11/13/2012 CHF 22.70 EFG INTL FIN GUR 12.750 11/13/2012 CHF 71.49 EFG INTL FIN GUR 13.000 11/13/2012 CHF 22.91 EFG INTL FIN GUR 13.000 11/13/2012 CHF 74.82 EFG INTL FIN GUR 14.000 11/13/2012 USD 23.41 EFG INTL FIN GUR 10.750 3/19/2013 USD 71.27 ZURCHER KANT FIN 9.250 11/9/2012 CHF 62.81 ZURCHER KANT FIN 9.250 11/9/2012 CHF 54.03 ZURCHER KANT FIN 12.670 12/28/2012 CHF 70.24 ZURCHER KANT FIN 11.500 1/24/2013 CHF 59.11 ZURCHER KANT FIN 17.000 2/22/2013 EUR 59.39 ZURCHER KANT FIN 10.128 3/7/2013 CHF 64.97 ZURCHER KANT FIN 13.575 4/10/2013 CHF 74.72 ZURCHER KANT FIN 7.340 4/16/2013 CHF 70.68 ZURCHER KANT FIN 12.500 7/5/2013 CHF 70.56 ZURCHER KANT FIN 10.200 8/23/2013 CHF 67.39 ZURCHER KANT FIN 9.000 9/11/2013 CHF 69.23 ICELAND ------- KAUPTHING 0.800 2/15/2011 EUR 26.50 LUXEMBOURG ---------- ARCELORMITTAL 7.250 4/1/2014 EUR 21.66 NETHERLANDS ----------- BLT FINANCE BV 12.000 2/10/2015 USD 24.88 EM.TV FINANCE BV 5.250 5/8/2013 EUR 5.89 KPNQWEST NV 10.000 3/15/2012 EUR 0.13 LEHMAN BROS TSY 7.500 9/13/2009 CHF 22.63 LEHMAN BROS TSY 6.600 2/22/2012 EUR 22.63 LEHMAN BROS TSY 7.000 2/15/2012 EUR 22.63 LEHMAN BROS TSY 6.000 2/14/2012 EUR 22.63 LEHMAN BROS TSY 2.500 12/15/2011 GBP 22.63 LEHMAN BROS TSY 12.000 7/4/2011 EUR 22.63 LEHMAN BROS TSY 11.000 7/4/2011 CHF 22.63 LEHMAN BROS TSY 11.000 7/4/2011 USD 22.63 LEHMAN BROS TSY 4.000 1/4/2011 USD 22.63 LEHMAN BROS TSY 8.000 12/31/2010 USD 22.63 LEHMAN BROS TSY 9.300 12/21/2010 EUR 22.63 LEHMAN BROS TSY 9.300 12/21/2010 EUR 22.63 LEHMAN BROS TSY 14.900 11/16/2010 EUR 22.63 LEHMAN BROS TSY 4.000 10/12/2010 USD 22.63 LEHMAN BROS TSY 10.500 8/9/2010 EUR 22.63 LEHMAN BROS TSY 6.000 7/28/2010 EUR 22.63 LEHMAN BROS TSY 6.000 7/28/2010 EUR 22.63 LEHMAN BROS TSY 4.000 5/30/2010 USD 22.63 LEHMAN BROS TSY 11.750 3/1/2010 EUR 22.63 LEHMAN BROS TSY 7.000 2/15/2010 CHF 22.63 LEHMAN BROS TSY 1.750 2/7/2010 EUR 22.63 LEHMAN BROS TSY 8.800 12/27/2009 EUR 22.63 LEHMAN BROS TSY 16.800 8/21/2009 USD 22.63 LEHMAN BROS TSY 8.000 8/3/2009 USD 22.63 LEHMAN BROS TSY 4.500 8/2/2009 USD 22.63 LEHMAN BROS TSY 8.500 7/6/2009 CHF 22.63 LEHMAN BROS TSY 11.000 6/29/2009 EUR 22.63 LEHMAN BROS TSY 10.000 6/17/2009 USD 22.63 LEHMAN BROS TSY 5.750 6/15/2009 CHF 22.63 LEHMAN BROS TSY 5.500 6/15/2009 CHF 22.63 LEHMAN BROS TSY 9.000 6/13/2009 USD 22.63 LEHMAN BROS TSY 15.000 6/4/2009 CHF 22.63 LEHMAN BROS TSY 17.000 6/2/2009 USD 22.63 LEHMAN BROS TSY 13.500 6/2/2009 USD 22.63 LEHMAN BROS TSY 10.000 5/22/2009 USD 22.63 LEHMAN BROS TSY 8.000 5/22/2009 USD 22.63 LEHMAN BROS TSY 8.000 5/22/2009 USD 22.63 LEHMAN BROS TSY 16.200 5/14/2009 USD 22.63 LEHMAN BROS TSY 4.000 4/24/2009 USD 22.63 LEHMAN BROS TSY 3.850 4/24/2009 USD 22.63 LEHMAN BROS TSY 7.000 4/14/2009 EUR 22.63 LEHMAN BROS TSY 9.000 3/17/2009 GBP 22.63 LEHMAN BROS TSY 13.000 2/16/2009 CHF 22.63 LEHMAN BROS TSY 11.000 2/16/2009 CHF 22.63 LEHMAN BROS TSY 10.000 2/16/2009 CHF 22.63 LEHMAN BROS TSY 0.500 2/16/2009 EUR 22.63 LEHMAN BROS TSY 7.750 1/30/2009 EUR 22.63 LEHMAN BROS TSY 13.432 1/8/2009 ILS 22.63 LEHMAN BROS TSY 16.000 12/26/2008 USD 22.63 LEHMAN BROS TSY 7.000 11/28/2008 CHF 22.63 LEHMAN BROS TSY 10.442 11/22/2008 CHF 22.63 LEHMAN BROS TSY 14.100 11/12/2008 USD 22.63 LEHMAN BROS TSY 16.000 11/9/2008 USD 22.63 LEHMAN BROS TSY 13.150 10/30/2008 USD 22.63 LEHMAN BROS TSY 16.000 10/28/2008 USD 22.63 LEHMAN BROS TSY 7.500 10/24/2008 USD 22.63 LEHMAN BROS TSY 6.000 10/24/2008 EUR 22.63 LEHMAN BROS TSY 5.000 10/24/2008 CHF 22.63 LEHMAN BROS TSY 8.000 10/23/2008 USD 22.63 LEHMAN BROS TSY 10.000 10/22/2008 USD 22.63 LEHMAN BROS TSY 16.000 10/8/2008 CHF 22.63 LEHMAN BROS TSY 7.250 10/6/2008 EUR 22.63 LEHMAN BROS TSY 18.250 10/2/2008 USD 22.63 LEHMAN BROS TSY 7.375 9/20/2008 EUR 22.63 LEHMAN BROS TSY 23.300 9/16/2008 USD 22.63 LEHMAN BROS TSY 14.900 9/15/2008 EUR 22.63 LEHMAN BROS TSY 3.000 9/12/2036 JPY 5.50 LEHMAN BROS TSY 6.000 10/30/2012 USD 5.50 LEHMAN BROS TSY 2.500 8/23/2012 GBP 22.63 LEHMAN BROS TSY 13.000 7/25/2012 EUR 22.63 Q-CELLS INTERNAT 1.375 4/30/2012 EUR 26.88 Q-CELLS INTERNAT 5.750 5/26/2014 EUR 26.88 RENEWABLE CORP 6.500 6/4/2014 EUR 61.31 SACYR VALLEHERM 6.500 5/1/2016 EUR 51.72 SWEDEN ------ Rorvik Timber 6.000 6/30/2016 SEK 66.00 SWITZERLAND ----------- BANK JULIUS BAER 8.700 8/5/2013 CHF 60.55 BANK JULIUS BAER 15.000 5/31/2013 USD 69.05 BANK JULIUS BAER 13.000 5/31/2013 USD 70.65 BANK JULIUS BAER 12.000 4/9/2013 CHF 56.05 BANK JULIUS BAER 10.750 3/13/2013 EUR 66.60 BANK JULIUS BAER 17.300 2/1/2013 EUR 54.65 BANK JULIUS BAER 9.700 12/20/2012 CHF 75.00 BANK JULIUS BAER 11.500 2/20/2013 CHF 47.15 BANK JULIUS BAER 12.200 12/5/2012 EUR 54.40 CLARIDEN LEU NAS 0.000 6/10/2014 CHF 62.19 CLARIDEN LEU NAS 0.000 6/10/2014 CHF 62.13 CLARIDEN LEU NAS 0.000 5/26/2014 CHF 65.30 CLARIDEN LEU NAS 0.000 5/13/2014 CHF 63.03 CLARIDEN LEU NAS 0.000 2/24/2014 CHF 55.39 CLARIDEN LEU NAS 0.000 2/11/2014 CHF 54.50 CLARIDEN LEU NAS 18.400 12/20/2013 EUR 74.64 CLARIDEN LEU NAS 0.000 11/26/2013 CHF 64.17 CLARIDEN LEU NAS 4.500 8/13/2014 CHF 48.74 CLARIDEN LEU NAS 16.500 9/23/2013 USD 57.03 CLARIDEN LEU NAS 0.000 9/23/2013 CHF 50.04 CLARIDEN LEU NAS 3.250 9/16/2013 CHF 49.05 CLARIDEN LEU NAS 7.500 11/13/2012 CHF 58.71 CLARIDEN LEU NAS 7.250 11/13/2012 CHF 74.60 CLARIDEN LEU NAS 10.250 11/12/2012 CHF 73.60 CLARIDEN LEU NAS 0.000 8/27/2014 CHF 55.45 CLARIDEN LEU NAS 0.000 9/10/2014 CHF 51.16 CLARIDEN LEU NAS 0.000 10/15/2014 CHF 57.48 CLARIDEN LEU NAS 5.250 8/6/2014 CHF 51.70 CLARIDEN LEU NAS 7.000 7/22/2013 CHF 72.18 CLARIDEN LEU NAS 10.000 6/10/2013 CHF 70.08 CLARIDEN LEU NAS 0.000 5/31/2013 CHF 55.87 CLARIDEN LEU NAS 6.500 4/26/2013 CHF 58.21 CLARIDEN LEU NAS 0.000 3/25/2013 CHF 59.57 CLARIDEN LEU NAS 0.000 3/18/2013 CHF 74.71 CLARIDEN LEU NAS 12.500 3/1/2013 USD 74.21 CLARIDEN LEU NAS 9.000 2/14/2013 CHF 66.37 CLARIDEN LEU NAS 11.500 2/13/2013 EUR 57.40 CLARIDEN LEU NAS 0.000 1/24/2013 CHF 66.96 CLARIDEN LEU NAS 8.750 1/15/2013 CHF 68.73 CLARIDEN LEU NAS 8.250 12/17/2012 CHF 61.30 CLARIDEN LEU NAS 0.000 12/17/2012 EUR 67.37 CLARIDEN LEU NAS 12.500 12/14/2012 EUR 72.83 CLARIDEN LEU NAS 0.000 12/14/2012 CHF 36.53 CLARIDEN LEU NAS 12.000 11/23/2012 CHF 47.83 CLARIDEN LEU NAS 8.000 11/20/2012 CHF 74.87 CLARIDEN LEU NAS 7.125 11/19/2012 CHF 58.17 CLARIDEN LEU NAS 7.250 11/16/2012 CHF 58.79 CREDIT SUISSE LD 8.900 3/25/2013 EUR 57.79 CREDIT SUISSE LD 10.500 9/9/2013 CHF 66.05 S-AIR GROUP 0.125 7/7/2005 CHF 10.63 SARASIN CI LTD 8.000 4/27/2015 CHF 68.67 SARASIN/GUERNSEY 13.600 2/17/2014 CHF 71.51 SARASIN/GUERNSEY 13.200 1/23/2013 EUR 72.52 SARASIN/GUERNSEY 15.200 12/12/2012 EUR 73.12 UBS AG 11.870 8/13/2013 USD 4.68 UBS AG 9.600 8/26/2013 USD 15.21 UBS AG 10.200 9/20/2013 EUR 61.15 UBS AG 12.900 9/20/2013 EUR 57.98 UBS AG 15.900 9/20/2013 EUR 55.99 UBS AG 17.000 9/27/2013 EUR 73.19 UBS AG 17.750 9/27/2013 EUR 73.50 UBS AG 18.500 9/27/2013 EUR 71.56 UBS AG 19.750 9/27/2013 EUR 74.84 UBS AG 20.000 9/27/2013 EUR 70.19 UBS AG 20.500 9/27/2013 EUR 74.87 UBS AG 20.500 9/27/2013 EUR 71.43 UBS AG 21.750 9/27/2013 EUR 72.53 UBS AG 22.000 9/27/2013 EUR 71.57 UBS AG 22.500 9/27/2013 EUR 70.55 UBS AG 22.750 9/27/2013 EUR 67.91 UBS AG 23.000 9/27/2013 EUR 72.72 UBS AG 23.250 9/27/2013 EUR 68.81 UBS AG 23.250 9/27/2013 EUR 68.35 UBS AG 24.000 9/27/2013 EUR 69.47 UBS AG 24.750 9/27/2013 EUR 65.71 UBS AG 8.060 10/3/2013 USD 19.75 UBS AG 13.570 11/21/2013 USD 16.25 UBS AG 6.980 11/27/2013 USD 34.85 UBS AG 17.000 1/3/2014 EUR 74.48 UBS AG 17.500 1/3/2014 EUR 73.41 UBS AG 18.250 1/3/2014 EUR 73.31 UBS AG 18.250 1/3/2014 EUR 74.28 UBS AG 19.500 1/3/2014 EUR 73.10 UBS AG 20.000 1/3/2014 EUR 74.53 UBS AG 20.500 1/3/2014 EUR 71.30 UBS AG 20.750 1/3/2014 EUR 71.59 UBS AG 21.000 1/3/2014 EUR 72.44 UBS AG 22.250 1/3/2014 EUR 74.19 UBS AG 23.000 1/3/2014 EUR 71.55 UBS AG 23.250 1/3/2014 EUR 70.29 UBS AG 23.250 1/3/2014 EUR 70.57 UBS AG 24.000 1/3/2014 EUR 72.95 UBS AG 24.250 1/3/2014 EUR 68.40 UBS AG 24.250 1/3/2014 EUR 70.18 UBS AG 6.440 5/28/2014 USD 51.67 UBS AG 3.870 6/17/2014 USD 38.08 UBS AG 6.040 8/29/2014 USD 35.22 UBS AG 7.780 8/29/2014 USD 20.85 UBS AG 11.260 11/12/2012 EUR 47.13 UBS AG 11.660 11/12/2012 EUR 34.35 UBS AG 13.120 11/12/2012 EUR 68.36 UBS AG 13.560 11/12/2012 EUR 36.51 UBS AG 13.600 11/12/2012 EUR 56.96 UBS AG 13.000 11/23/2012 USD 62.55 UBS AG 8.150 12/21/2012 EUR 72.14 UBS AG 8.250 12/21/2012 EUR 74.88 UBS AG 8.270 12/21/2012 EUR 74.19 UBS AG 8.990 12/21/2012 EUR 72.49 UBS AG 9.000 12/21/2012 EUR 69.13 UBS AG 9.150 12/21/2012 EUR 71.84 UBS AG 9.450 12/21/2012 EUR 74.42 UBS AG 9.730 12/21/2012 EUR 70.24 UBS AG 9.890 12/21/2012 EUR 66.37 UBS AG 10.060 12/21/2012 EUR 72.98 UBS AG 10.060 12/21/2012 EUR 69.64 UBS AG 10.160 12/21/2012 EUR 73.41 UBS AG 10.490 12/21/2012 EUR 68.12 UBS AG 10.690 12/21/2012 EUR 71.60 UBS AG 10.810 12/21/2012 EUR 63.85 UBS AG 11.000 12/21/2012 EUR 67.59 UBS AG 11.260 12/21/2012 EUR 66.14 UBS AG 11.270 12/21/2012 EUR 70.63 UBS AG 11.330 12/21/2012 EUR 70.28 UBS AG 11.770 12/21/2012 EUR 61.53 UBS AG 11.970 12/21/2012 EUR 65.67 UBS AG 11.980 12/21/2012 EUR 69.02 UBS AG 12.020 12/21/2012 EUR 64.27 UBS AG 12.200 12/21/2012 EUR 56.09 UBS AG 12.400 12/21/2012 EUR 68.07 UBS AG 12.760 12/21/2012 EUR 59.39 UBS AG 12.800 12/21/2012 EUR 62.51 UBS AG 12.970 12/21/2012 EUR 63.87 UBS AG 13.320 12/21/2012 EUR 66.64 UBS AG 13.560 12/21/2012 EUR 65.71 UBS AG 13.570 12/21/2012 EUR 60.85 UBS AG 13.770 12/21/2012 EUR 57.41 UBS AG 13.980 12/21/2012 EUR 62.18 UBS AG 14.350 12/21/2012 EUR 59.29 UBS AG 14.690 12/21/2012 EUR 64.44 UBS AG 14.740 12/21/2012 EUR 63.53 UBS AG 14.810 12/21/2012 EUR 55.58 UBS AG 15.000 12/21/2012 EUR 60.59 UBS AG 15.130 12/21/2012 EUR 57.81 UBS AG 15.860 12/21/2012 EUR 53.88 UBS AG 15.920 12/21/2012 EUR 56.41 UBS AG 15.930 12/21/2012 EUR 61.51 UBS AG 16.030 12/21/2012 EUR 59.10 UBS AG 16.600 12/21/2012 EUR 50.18 UBS AG 16.710 12/21/2012 EUR 55.09 UBS AG 16.930 12/21/2012 EUR 52.30 UBS AG 17.070 12/21/2012 EUR 57.69 UBS AG 17.500 12/21/2012 EUR 53.84 UBS AG 18.000 12/21/2012 EUR 50.83 UBS AG 19.090 12/21/2012 EUR 51.52 UBS AG 10.770 1/2/2013 USD 38.33 UBS AG 13.030 1/4/2013 EUR 73.40 UBS AG 13.630 1/4/2013 EUR 71.63 UBS AG 14.230 1/4/2013 EUR 69.95 UBS AG 14.820 1/4/2013 EUR 68.36 UBS AG 15.460 1/4/2013 EUR 74.82 UBS AG 15.990 1/4/2013 EUR 65.39 UBS AG 16.500 1/4/2013 EUR 73.32 UBS AG 17.000 1/4/2013 EUR 73.98 UBS AG 17.150 1/4/2013 EUR 62.69 UBS AG 17.180 1/4/2013 EUR 74.58 UBS AG 18.000 1/4/2013 EUR 73.54 UBS AG 18.300 1/4/2013 EUR 60.23 UBS AG 19.440 1/4/2013 EUR 57.99 UBS AG 19.750 1/4/2013 EUR 69.92 UBS AG 20.500 1/4/2013 EUR 70.21 UBS AG 20.570 1/4/2013 EUR 55.94 UBS AG 21.700 1/4/2013 EUR 54.05 UBS AG 21.750 1/4/2013 EUR 69.65 UBS AG 23.750 1/4/2013 EUR 66.55 UBS AG 11.020 1/25/2013 EUR 67.05 UBS AG 12.010 1/25/2013 EUR 65.34 UBS AG 14.070 1/25/2013 EUR 62.22 UBS AG 16.200 1/25/2013 EUR 74.54 UBS AG 8.620 2/1/2013 USD 14.04 UBS AG 8.980 2/22/2013 EUR 72.86 UBS AG 10.590 2/22/2013 EUR 69.90 UBS AG 10.960 2/22/2013 EUR 67.35 UBS AG 13.070 2/22/2013 EUR 63.96 UBS AG 13.660 2/22/2013 EUR 61.23 UBS AG 13.940 2/22/2013 EUR 73.02 UBS AG 15.800 2/22/2013 EUR 67.24 UBS AG 8.480 3/7/2013 CHF 58.00 UBS AG 10.000 3/7/2013 USD 72.30 UBS AG 12.250 3/7/2013 CHF 59.20 UBS AG 9.000 3/22/2013 USD 11.16 UBS AG 9.850 3/22/2013 USD 19.75 UBS AG 16.500 4/2/2013 EUR 72.16 UBS AG 17.250 4/2/2013 EUR 72.45 UBS AG 18.000 4/2/2013 EUR 73.44 UBS AG 19.750 4/2/2013 EUR 69.63 UBS AG 21.250 4/2/2013 EUR 69.05 UBS AG 21.500 4/2/2013 EUR 73.98 UBS AG 21.500 4/2/2013 EUR 73.88 UBS AG 22.250 4/2/2013 EUR 67.19 UBS AG 22.250 4/2/2013 EUR 69.43 UBS AG 24.250 4/2/2013 EUR 65.24 UBS AG 24.750 4/2/2013 EUR 68.24 UBS AG 10.860 4/4/2013 USD 37.21 UBS AG 9.650 4/11/2013 USD 27.17 UBS AG 9.930 4/11/2013 USD 24.77 UBS AG 11.250 4/11/2013 USD 24.39 UBS AG 10.170 4/26/2013 EUR 67.84 UBS AG 10.970 4/26/2013 EUR 66.50 UBS AG 12.610 4/26/2013 EUR 64.06 UBS AG 7.900 4/30/2013 USD 33.75 UBS AG 9.830 5/13/2013 USD 30.07 UBS AG 8.000 5/24/2013 USD 63.90 UBS AG 11.670 5/31/2013 USD 35.12 UBS AG 12.780 6/7/2013 CHF 62.60 UBS AG 16.410 6/7/2013 CHF 64.70 UBS AG 9.330 6/14/2013 USD 22.00 UBS AG 11.060 6/14/2013 USD 28.17 UBS AG 6.770 6/21/2013 USD 10.43 UBS AG 7.120 6/26/2013 USD 29.83 UBS AG 15.250 6/28/2013 EUR 74.98 UBS AG 17.000 6/28/2013 EUR 74.05 UBS AG 17.250 6/28/2013 EUR 72.59 UBS AG 19.250 6/28/2013 EUR 70.54 UBS AG 19.500 6/28/2013 EUR 70.28 UBS AG 20.250 6/28/2013 EUR 74.82 UBS AG 20.500 6/28/2013 EUR 70.91 UBS AG 21.000 6/28/2013 EUR 68.62 UBS AG 22.000 6/28/2013 EUR 71.86 UBS AG 22.500 6/28/2013 EUR 66.83 UBS AG 23.000 6/28/2013 EUR 67.15 UBS AG 23.500 6/28/2013 EUR 71.72 UBS AG 24.000 6/28/2013 EUR 68.94 UBS AG 24.500 6/28/2013 EUR 67.97 UBS AG 11.450 7/1/2013 USD 27.96 UBS AG 6.100 7/24/2013 USD 30.07 UBS AG 8.640 8/1/2013 USD 27.87 UBS AG 13.120 8/5/2013 USD 4.62 UBS AG 0.500 4/27/2015 CHF 52.50 UBS AG 6.070 11/12/2012 EUR 65.82 UBS AG 8.370 11/12/2012 EUR 59.26 UBS AG 8.590 11/12/2012 EUR 53.53 UBS AG 9.020 11/12/2012 EUR 43.76 UBS AG 9.650 11/12/2012 EUR 37.64 UBS AG 10.020 11/12/2012 EUR 71.72 UBS AG 10.930 11/12/2012 EUR 64.23 BARCLAYS BK PLC 11.000 6/28/2013 EUR 43.13 BARCLAYS BK PLC 11.000 6/28/2013 EUR 74.83 BARCLAYS BK PLC 10.750 3/22/2013 EUR 41.06 BARCLAYS BK PLC 10.000 3/22/2013 EUR 42.44 BARCLAYS BK PLC 6.000 1/2/2013 EUR 50.37 BARCLAYS BK PLC 8.000 6/28/2013 EUR 47.66 ESSAR ENERGY 4.250 2/1/2016 USD 72.62 MAX PETROLEUM 6.750 9/8/2013 USD 40.36 ********* 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., Washington, D.C., USA. Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Ivy B. Magdadaro, Frauline S. Abangan and Peter A. Chapman, Editors. Copyright 2013. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000 or Nina Novak at 202-241-8200. * * * End of Transmission * * *