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        T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Thursday, January 2, 2014, Vol. 15, No. 1

                            Headlines

C Y P R U S

BROKERCREDITSERVICE CYPRUS: S&P Assigns 'B' Counterparty Ratings


C Z E C H   R E P U B L I C

BH SECURITIES: Moody's Cuts National Scale Rating to 'Ba1.cz'


G E R M A N Y

DEUTSCHE POSTBANK: Moody's Affirms 'Ba2(hyb)' Rating on Sub. Debt


I R E L A N D

CORNERSTONE TITAN 2007-1: Moody's Cuts Rating on X Notes to Caa1
JAZZ PHARMACEUTICALS: Moody's Says Gentium Deal is Credit Neg.
PERMANENT TSB: Moody's Lowers Deposit Ratings to 'B3'
QUIRINUS PLC: Moody's Confirms 'Ba3' Rating on Class X2 Notes

* Moody's Review Irish Mortgage Bond Ratings for Downgrade
* Moody's Says Irish RMBS Performance Still Weak in October 2013


I T A L Y

BANCA CARIGE: Moody's Retains Bonds Rating Over Amendments
BANCA MONTE: Hedging Structure Amendments No Impact on Ba1 Rating


L A T V I A

EXPOBANK AS: Moody's Assigns 'B1' Long-Term Deposit Rating


L U X E M B O U R G

ELECTRAWINDS SE: Gets 3-Mo. Court Protection for Reorganization


N E T H E R L A N D S

DEMIR-HALK BANK: Moody's Affirms 'Ba2' Deposit Ratings
E-MAC DE 2006-II: Moody's Cuts Rating on EUR24.5MM Notes to Caa2
GREEN APPLE 2007-1: Moody's Ups Rating on EUR3MM C Notes From Ba1
GROSVENOR PLACE: Moody's Hikes Rating on Class E Notes to 'Ba3'


N O R W A Y

ALBAIN MIDCO: Moody's Changes Outlook to Neg. & Affirms B2 CFR
SONGA OFFSHORE: Moody's Affirms 'Caa1' CFR; Outlook Stable
SONGA OFFSHORE: S&P Raises CCR to 'B-'; Outlook Negative


R U S S I A

ASKOLD: Russia's Central Bank Revokes Operating License
BETALINK: Court of Appeal Rejects MTS' Suit v. Former CEO
HMS HYDRAULIC: S&P Keeps 'B' Rating on CreditWatch Negative
MORTGAGE AGENT: Funds Transfer to Credit Europe No Ratings Impact
RYBLYOVSKY BANK: Central Bank Revokes License After Default


S L O V E N I A

MERKUR: Declared Insolvency; Files for New Debt Restructuring


S P A I N

* Moody's Says Spanish SME ABS Delinquency High in September 2013


U K R A I N E

CRIMEA: S&P Revises Outlook to Stable & Affirms 'B-' ICR
DNIPROPETROVSK CITY: S&P Revises Outlook & Affirms 'B-' ICR
IVANO-FRANKIVSK: S&P Revises Outlook to Stable & Affirms 'B-' ICR
KYIV CITY: S&P Revises Outlook to Stable and Affirms 'B-' ICR
UKRAINE: S&P Revises Outlook to Stable & Affirms 'B-/B' Ratings


U N I T E D   K I N G D O M

CO-OPERATIVE BANK: Moody's Withdraws Ca Subordinated Debt Rating
CO-OPERATIVE BANK: DBRS Downgrades Deposit Ratings to 'BB'
HJ HEINZ: Moody's Corrects Rating on GBP125MM Notes to 'B1'
PUNCH TAVERNS: Moody's Lowers Ratings on 3 Note Classes to Ca(sf)


U Z B E K I S T A N

AMIRBANK: S&P Revises Outlook to Stable & Affirms 'CCC' Rating


                            *********


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C Y P R U S
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BROKERCREDITSERVICE CYPRUS: S&P Assigns 'B' Counterparty Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B/B' long- and
short-term counterparty credit ratings to investment company
BrokerCreditService (Cyprus) Ltd. (BCS Cyprus).  The outlook is
stable.

The ratings on BCS Cyprus reflect S&P's view of its "core" status
to the Russian BCS Group under our group rating methodology.  S&P
do not assign a stand-alone credit profile to the Cypriot
subsidiary because it is fully integrated with the group.  S&P
assess the creditworthiness of the BCS Group at 'b' and rate the
group's holding company -- BCS Holding International Ltd. -- one
notch below the notional group credit profile (GCP) to reflect
its status as a non-operating holding company.

BCS Cyprus, which is a 100%-owned subsidiary of BCS Holding
International, is domiciled in Cyprus mainly for regulatory and
tax reasons.  BCS Cyprus was founded in 2004 and licensed by the
Cyprus Securities and Exchange Commission (CySEC) to provide
Russian retail clients access to international financial markets.
Since then, BCS Cyprus's range of operations has significantly
broadened.  The company is the group's hub outside of Russia,
providing access for domestic institutional and retail customers
to international markets and for foreign customers to the Russian
markets.

Since 2011, BCS Group is increasingly focused on the development
of the international institutional brokerage, where it strives to
become the main facilitator of investment flows between Russia
and the rest of the world.  BCS Cyprus provides necessary
infrastructure, servicing all of the group's trading volumes on
the London Stock Exchange (LSE) International Order Book, almost
all volumes in derivatives and foreign currency trading, and
about 40% of trading volumes in Russian stocks on the Moscow
Exchange (MICEX).  BCS Cyprus accounted for about 30% of the BCS
Group's capital as of mid-year 2013.

S&P understands that the group plans to transfer operations with
its international institutional clients to the newly created
U.K.-based subsidiary, BCS Prime Brokerage Ltd.  However, that is
likely to be a lengthy and gradual process, and S&P expects
retail and asset management operations to be separated from the
institutional brokerage and stay with BCS Cyprus.  BCS' Cypriot
subsidiary will remain as a back-up company for institutional
brokerage, maintaining all the facilities and counterparty
relationships with the international financial institutions.  At
the moment, BCS Cyprus has established relationships with 377
counterparties on the over-the-counter market.  For these
reasons, we believe that BCS Cyprus will retain its key role
within the group.

The profitability of BCS Cyprus and the group as a whole has been
declining for several years.  BCS Cyprus reported profits of
US$6.3 million for the first 10 months of 2013 and US$16 million
for 2012, compared with US$27.7 million in 2011.  This trend is
due to one-off revenues in previous years and the group's large
investments in new IT systems and new staff, including in the
group's U.K. subsidiary, whose expenses are largely booked to BCS
Cyprus.  S&P expects revenues to remain volatile and susceptible
to changes in market conditions, but S&P projects the group's
growth to outpace the increase in costs.  BCS Cyprus's
capitalization remains adequate, supported by a US$20 million
capital injection from the group in September 2013.  Its Basel II
total capital adequacy ratio was 21.2% as of Oct. 31, 2013.

S&P's ratings assessment takes into account its recently
published criteria on ratings above the sovereign.  Under the
criteria, S&P do not perform sovereign stress tests or apply
rating caps to issuers with under 10% exposure to the
jurisdiction in which they are based.  Therefore, S&P rates BCS
Cyprus above the sovereign rating on the Republic of Cyprus.

The outlook is stable, reflecting that on BCS Holding
International Ltd.  S&P expects the ratings to move in line with
those on BCS' GCP.

S&P could lower the ratings if it no longer considers BCS Cyprus
to be "core" to the BCS Group.  This could happen if BCS Group
transfers both retail and institutional operations to its U.K.
subsidiary, or if the Cypriot tax regime becomes significantly
less favorable, forcing the group to divest or liquidate its
Cypriot subsidiary.

S&P would only raise the ratings on BCS Cyprus if it revised
upward the 'b' GCP.



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C Z E C H   R E P U B L I C
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BH SECURITIES: Moody's Cuts National Scale Rating to 'Ba1.cz'
-------------------------------------------------------------
Moody's Investors Service has downgraded the national scale
rating (NSR) of Czech Republic-based BH Securities, a.s. to
Ba1.cz, from Baa3.cz. At the same time, the issuer outlook was
changed to stable from negative.

Ratings Rationale

The downgrade reflects the decline in BH Securities'
profitability observed in 2012 and 2013 and Moody's expectation
this pressure will persist for some time. The Czech operating
environment remains challenging, as evidenced by a 26% decline in
the volume of traded shares on the Prague Stock Exchange in the
10 months ended October 2013 which followed a 36% decline for the
whole of 2012. Although BH Securities has maintained its position
in the Czech market within the top 10 securities trading
companies, its revenues have been declining, reflecting reduced
client activity and challenges in broadening the client base in
the pressured economic environment.

The stable outlook on BH Securities' Ba1.cz NSR reflects Moody's
expectation that, despite these challenges, performance metrics
will stabilize at the reported lower levels, in anticipation of a
stabilization of the Czech economy. The rating agency expects GDP
growth of 1.8% in 2014, after contractions in 2012 and 2013. In
addition, BH Securities is actively engaged in efforts to widen
its client base. If the successful execution of such attempts
leads to a sustainable improvement of the company's earnings,
without increasing its risk positioning, this could lead to
renewed upward pressure on the rating, but Moody's also sees
considerable execution risk associated with efforts to expand the
business.

BH Securities reported a CZK9.6 million (EUR378,000) net profit
in 2012, a 60% decline compared to 2011, reflecting the
increasingly challenging environment for equity markets. Moody's
notes that the drop in net income was primarily driven both by
the decline in client trading volumes, and by the resulting lower
broker commission revenues.

BH Securities' results for the first nine months of 2013 showed a
continuation of this downward trend, with pre-tax income
declining by 63% compared to the same period in 2012.
Deteriorating cost efficiency presents further challenges. BH
Securities' cost-to-income ratio deteriorated to 92% as of Q3
2013, compared to 88% as of year-end 2012, due to increased
employee and administrative expenses (employee expenses increased
11% year-on-year during the first nine months of 2013), as well
as the decline in revenues.

What Could Move the Ratings UP/Down

Upwards pressure on BH Securities' NSR is unlikely in the near
term. Longer-term, upward pressure on the ratings could result
from successful efforts to improve its franchise value, and
strengthened profitability, while managing efficiency and risk
appetite.

Downward pressure could be exerted on BH Securities' NSR if the
company reports losses for an extended period, or if its
franchise value deteriorates. In Moody's opinion, any efforts by
BH Securities to compensate for the shortfall in client revenues
by increasing the company's risk appetite, could have negative
rating implications.



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G E R M A N Y
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DEUTSCHE POSTBANK: Moody's Affirms 'Ba2(hyb)' Rating on Sub. Debt
-----------------------------------------------------------------
Moody's Investors Service has affirmed Deutsche Postbank AG's A2
long-term debt and deposit ratings and changed the outlook on the
ratings to negative from stable. Consequently, Postbank's Prime-1
short-term debt and deposit ratings were affirmed.

The rating action follows (1) Moody's affirmation of Deutsche
Bank's standalone credit profile -- as expressed by its
standalone bank financial strength rating (BFSR) and baseline
credit assessment (BCA) -- at C-/baa2 and (2) the affirmation of
its supported long-term senior ratings at A2. The outlook on all
these ratings was changed to negative from stable. For further
details, please refer to the press release "Moody's assigns
negative outlook to Deutsche Bank AG and subsidiaries" published
Dec. 19, 2013.

Furthermore, Moody's affirmed Postbank's Baa3 subordinated debt
ratings, its Ba2(hyb) rated junior subordinated debt and hybrid
securities issued by several group entities, as well as its
Ba1(hyb) rated junior subordinated debt issued by ProSecure
Funding Limited Partnership.

Postbank's standalone BFSR of D+, equivalent to a BCA of ba1, was
not affected by the rating action and carries a stable outlook.

Ratings Rationale

--- Negative Outlook On The Long-Term Ratings

The negative outlook on Postbank's long-term senior debt and
deposit ratings reflects the outlook change of Postbank's parent,
Deutsche Bank, to negative from stable. Moody's continues to
assess the probability of parental support as very high, which
provides Postbank's long-term debt and deposit ratings with five
notches of rating uplift from parental support. The rating
agency's assessment is underpinned by a domination and profit and
loss transfer agreement between DB Finanz-Holding GmbH (a wholly
owned subsidiary of Deutsche Bank) as the controlling company,
and Postbank as the dependent company. Moody's also takes into
account Postbank's role as one of the major deposit-taking
institutions and its key role in Germany's banking sector's
payments system.

The change in outlook to negative on Postbank's subordinated
debt, junior subordinated debt and hybrid ratings was prompted by
the change in outlook to negative on Deutsche Bank's standalone
C- BFSR. These instruments are notched off Postbank's baa2
adjusted BCA, which incorporates Moody's assessment of the
availability of parental support.

What Could Move The Ratings UP/DOWN

The negative outlook on Postbank's long-term ratings indicates
that there is currently no upward pressure on the ratings. Any
mild upward pressure on the standalone credit strength (as
expressed by the BFSR/BCA of D+/ba1) is unlikely to lead to an
upgrade of the long-term ratings given the very high uplift
factored into these ratings.

Downwards pressure could be exerted on Postbank's BFSR from
depressed earnings, as a result of (1) unexpected losses from its
still large investment portfolio and asset-quality deterioration
from commercial real estate exposure; (2) unexpected structural
weakness in residential mortgage loans; and (3) a further decline
in its core consumer banking earnings, for example as a result of
the persistent low interest rate environment.

Postbank's long-term ratings would be downgraded (1) as a result
of a downgrade of its own standalone D+ BFSR; (2) in the event of
a downgrade of Deutsche Bank's A2 long-term ratings; or (3) due
to a re-assessment of our parental support assumptions.

List of Affected Ratings

The following ratings of Postbank were affirmed and the outlook
was changed to negative:

- Senior debt and deposits ratings at A2;
- Subordinated debt ratings at Baa3;
- Junior subordinated debt at Ba2(hyb);
- Junior subordinated debt issued by ProSecure Funding Limited
   Partnership at Ba1(hyb);
- Non-cumulative Trust preferred securities issued by Deutsche
   Postbank Funding Trust I, II, III, and IV at Ba2(hyb).

The following ratings of Postbank were affirmed:

- Prime-1 short-term debt and deposit ratings;

The following rating of Postbank was not affected by the rating
action:

- D+ BFSR, equivalent to a BCA of ba1, outlook stable



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I R E L A N D
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CORNERSTONE TITAN 2007-1: Moody's Cuts Rating on X Notes to Caa1
----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of two
classes of Notes issued by Cornerstone Titan 2007-1 p.l.c.

Moody's rating action is as follows:

Issuer: Cornerstone Titan 2007-1 p.l.c.

EUR661M A1 Notes, Affirmed Aa3 (sf); previously on Aug 3, 2011
Downgraded to Aa3 (sf)

EUR333M A2 Notes, Downgraded to B1 (sf); previously on Jan 12,
2012 Downgraded to Ba1 (sf)

EUR75.1M B Notes, Affirmed Caa1 (sf); previously on Jan 12, 2012
Downgraded to Caa1 (sf)

EUR44.175M C Notes, Affirmed Caa2 (sf); previously on May 13,
2011 Downgraded to Caa2 (sf)

EUR97.185M D Notes, Affirmed Caa3 (sf); previously on May 13,
2011 Downgraded to Caa3 (sf)

EUR0.1M X Notes, Downgraded to Caa1 (sf); previously on Aug 22,
2012 Downgraded to B2 (sf)

Moody's does not rate the Class E, Class F, Class, G, Class VA,
and Class VB Notes.

Ratings Rationale

The downgrade action reflects (i) the continued weak performance
of the loan pool including further value declines leading to
increased expected losses and (ii) a potential shortfall of
interest payments on Class A2 on the next interest payment dates
which would constitute a Note event of default once it will
become the most senior class in the capital structure.

The rating on Class A1 is affirmed due to its expected full
repayment at the next interest payment date, given the current
sequential allocation of principal and the expected repayment of
several loans in the transaction. The ratings on the Class B,
Class C and Class D Notes are affirmed as their current levels
are already commensurate with the revised loss expectations.

Methodology Underlying the Rating Action:

The principal methodology used in this rating was Moody's
Approach to Rating EMEA CMBS Transactions published in December
2013.

Other factors used in this rating are described in European CMBS:
2013 Central Scenarios published in February 2013.

FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING

Factors that would lead to an upgrade of the Class A2 rating
include a lowered risk of interest shortfalls at the loan pool
level. More specifically, the risk of interest shortfalls would
decrease upon (i) a decrease in Issuer expenses, in particular
special servicing fees, (ii) a decrease in the amount of
interests allocated to Class X, (iii) an increase in borrower
interest collections.

Another factor that would lead to an upgrade of the ratings are
higher than expected loan recoveries that would decrease the
expected losses at the loan pool level.

Conversely, higher expected losses would lead to a potential
downgrade of the ratings. Main factors or circumstances that
could lead to a downgrade of the ratings are (i) a decline in the
property values backing the underlying loans that is worse than
Moody's expected and (iii) underperformance from the special
servicers to maximize loan recoveries through asset sales or
refinancings.

MOODY'S PORTFOLIO ANALYSIS

Cornerstone Titan 2007-1 p.l.c. closed in March 2007 and
represents the securitization of initially 32 commercial mortgage
loans originated by Credit Suisse International and Capmark Bank
Europe plc. Since closing, the pool balance has decreased by 60%
to EUR535 million as at the October interest payment date.

The loan pool currently comprises 17 loans mainly located in
Germany (63% by pool balance) and France (32% by pool balance)
secured by first ranking legal mortgages over mainly mixed use
(57% by pool balance) and retail properties (30% by pool
balance).

The portfolio is becoming more concentrated, with the first three
loans representing 63% of the securitized balance. Moody's uses a
variation of Herf to measure diversity of loan size, where a
higher number represents greater diversity. This pool has a Herf
of 6. Large multi-borrower transactions typically have a Herf of
less than 10 with an average of around 5.

All the loans are currently in default. Except for the Munster
loan, which will likely repay at the next interest payment date,
all the loans are in special servicing. In addition to the
Munster loan, the Essen loan and a large part of the Star loan
will also likely repay in January 2014. This will lead to a full
redemption of the Class A1 Notes and will expose the transaction
to the risk of a Note event of default in case of interest
shortfalls on Class A2.

Due to high special servicing fees and the high interest amounts
allocated to Class X, the Issuer's interest collections may not
always be sufficient to pay interests on Class A2 once it has
become the most senior class. The sequential allocation structure
and the option to reallocate Issuer's principal collections to
pay interest on the most senior class mitigates the risk of an
interest shortfall as long as the loans are gradually repaid in
particular through asset sales. Most of the loans are at an
advanced stage of the sales process. However, the risk of low
principal repayments combined with high Issuer's costs cannot be
excluded on future interest payment dates.

The pool has experienced significant losses to date and
additional losses are expected for the remaining loans. Lower
valuations have been received for several loans in the last
quarters, contributing to the upward revision of Moody's expected
losses for the pool. Moody's weighted average whole loan-to-value
ratio for the pool is 169% compared to 121% reported as of the
last interest payment date.


JAZZ PHARMACEUTICALS: Moody's Says Gentium Deal is Credit Neg.
--------------------------------------------------------------
Moody's Investors Service commented that Jazz Pharmaceutical's
announced acquisition of Gentium Sp.A. is credit negative because
of the high purchase price relative to near-term EBITDA
contribution. Jazz will pay US$57 per share for Gentium, or
roughly US$1 billion, for an EBITDA contribution of US$20 to
US$30 million in 2014. Jazz is rated Ba3 with a stable rating
outlook and Gentium is unrated.

The principal methodology used in this rating was the Global
Pharmaceutical Industry published in December 2012. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

Jazz Pharmaceuticals, Inc. is a US subsidiary of Jazz
Pharmaceuticals plc (collectively referred to as "Jazz"), a
specialty pharma company with a portfolio of products that treat
unmet needs in narrowly focused therapeutic areas. Total revenues
for the twelve months ended September 30, 2013 were approximately
US$820 million.


PERMANENT TSB: Moody's Lowers Deposit Ratings to 'B3'
-----------------------------------------------------
Moody's Investors Service has downgraded by two notches Permanent
tsb's (PTSB) deposit ratings to B3/NP from B1/NP and senior debt
ratings to Caa1 from B3, prompted by the concurrent lowering of
the bank's baseline credit assessment (BCA) by three notches to
E/caa3 from E+/b3. NP ratings also affirmed.

The rating action reflects Moody's view of the increase in risks
to bondholders arising from

(1) sizable asset-quality challenges that may potentially put
pressure on PTSB's capital levels beyond the expectations of the
Prudential Capital Assessment Review (PCAR) undertaken by the
Irish regulator in 2011;

(2) the closely-related risk for PTSB's bondholders stemming from
the prospect of the stress test that will be undertaken by the
European Central Bank (ECB) in 2014. While the design of the
stress test remains unclear and the results difficult to
anticipate, banks such as PTSB with poor quality lending books
and very limited prospects of returning to positive profitability
over the rating horizon are at relatively greater risk of
'failing' the test. Any resulting material capital shortfall
following the ECB's Comprehensive Assessment, will raise the
risks for its bondholders. And

(3) the continued dependence on public funding support for its
non-performing and non-core businesses increases uncertainty and
potential risk for bondholders. In that context, the approval of
the restructuring plan submitted to the European Commission (EC)
is still outstanding. The bank will potentially have to wait some
time to receive approval from the EC and unveil the final details
of its reorganization and funding plans. Given the bank's
significant negative funding gap, Moody's notes that the creation
of independent business units including a core bank, an asset
management unit and a non-core portfolio, would create funding
challenges for the businesses outside of the core bank since the
deposit base will likely remain within the core business. As a
result, these business units will likely have to continue relying
on external liquidity provided by monetary authorities;

The moderate expectation of support from the Irish government
leads to a two-notch uplift for PTSB's senior unsecured debt
ratings. In line with previous government actions to support
depositors, Moody's continues to incorporate a higher degree of
support likelihood for PTSB's deposits, resulting in three
notches of rating uplift from the standalone BCA.

RATINGS RATIONALE

   --- UNCERTAINTY REGARDING APPROVAL OF RESTRUCTURING PROCESS
AND ONGOING WHOLESALE FUNDING RELIANCE

The restructuring plan submitted to the EC in June 2012 (updated
in August 2013) involves the reorganization of the bank into a
number of business units separating the non-core and non
strategic assets from the core performing bank so that a viable
entity can eventually return to the private sector. Despite
significant progress reducing its funding gap, reflected in a
decline of its loan to deposit ratio to 157% in June 2013 from
191% in December 2012, Moody's believes that reliance on funding
from monetary authorities will remain high. Furthermore, the
potential sources of funding for each independent unit remains
unclear and therefore, Moody's considers that monetary
authorities would have to continue providing support. In
addition, the group will face a funding cliff in 2015 when most
of its debt matures (EUR2.4 billion).

  --- ASSET-QUALITY CHALLENGES CONTINUE TO POSE DOWNSIDE RISKS

The significant and increasing level of problem loans at 22.3% as
of June 2013 continues to pose risks to the bank's performance.
Although the bank maintains coverage ratios in line with Irish
peers, the need to address the ongoing asset quality problems may
increase regulatory pressure on banks since the adequacy of
current provisions could be questioned once more. The bank has
not released any details regarding further potential impairment
provisions, expected losses on default assets or adjustments on
risk weighted assets (RWAs) following the balance sheet
assessment BSA performed by the Central Bank of Ireland (CBI).

  --- ADEQUATE CAPITALISATION UNDER CURRENT RULES, BUT PTSB STILL
HAS TO PASS THE ECB STRESS TEST

Moody's believes that the these underlying asset quality
problems, reflected in a very high level of NPLs could leave the
bank in a more vulnerable position to face the European Central
Bank's (ECB) stress test later in 2014 as part of its
comprehensive assessment of European banks. There remains
considerable uncertainty surrounding the stress testing process
and the key parameters it will incorporate -- for example loss
rates, target capital levels, corrective windows -- which make
the outcome difficult to anticipate. However, in Moody's opinion,
banks such as PTSB, with vulnerable lending portfolios, and
negative profitability, are at relatively greater risk of
'failing' the stress test.

In Moody's view the ECB's Asset Quality Review (AQR) poses a
lower threat than the stress test since the ECB will likely use
the data from the BSA for its comprehensive assessment in line
with CBI's expectations. As a result, the rating agency believes
that the bank will remain adequately capitalized under the Basel
III transitional rules even after meeting all the potential
requirements outlined as a result of the ECB's AQR.

The implications of 'failing' the stress test are difficult to
predict and the offsetting actions management could take
correspondingly uncertain. However, Moody's believes that the
slightly heightened risks to bondholders need to be reflected in
both lower baseline credit assessment (to signal the potential
for some sort of support event) and lower debt ratings (to signal
the heightened risk to senior creditors).

  --- SOME POSITIVE SIGNS STEMMING FROM THE RETURN TO GROWTH IN
THE IRISH ECONOMY

The action reflects a balance of factors, including some positive
signs. Despite the significant challenges that the Irish economy
still faces, signs of stabilization -- reduced unemployment
levels and increased asset prices -- could help PTSB to improve
its asset quality and profitability, despite the negative effect
on profits that lower ECB base rates could have on the bank's
tracker mortgages.

In Moody's view, PTSB's mortgage portfolio credit quality will
likely show some improvement in line with the system, after the
CBI reported a decline in the number of mortgage accounts for
principal dwelling houses in arrears during Q3 2013. Moody's
notes that the bank has significantly strengthened its collection
processes.

  --- SUPPORT ASSUMPTIONS

The senior unsecured debt rating of PTSB incorporates two notches
of uplift, reflecting Moody's assumption of a moderate
probability of systemic support coming from the Irish government,
if the bank requires additional capital. Moody's believes that
PTSB will continue to be considered as a systemically important
bank by the Irish authorities.

The deposit ratings of PTSB incorporate three notches of rating
uplift from the BCA, reflecting Moody's expectation that support
for deposits would likely be forthcoming in the event of need.
This is based on the supportive stance of the Irish government
towards depositors as witnessed by the 2011 transfer orders to
sell the deposits of Anglo Irish Bank and Irish Nationwide
Building Society to AIB and IL&P.

  --- UPGRADE OF SUBORDINATED AND HYBRID INSTRUMENTS

Moody's upgraded the provisional ratings of PTSB's subordinated
debt to (P)Ca from (P)C and affirmed the (P)C junior subordinated
debt provisional rating in line with the rating agency's
guidelines for rating junior bank obligations.

WHAT COULD MOVE THE RATINGS UP/DOWN

Upward pressure on the bank's BCA is unlikely in the short term
given the current negative outlook. However, upward pressure
might develop from a successful restructuring plan outlining
potential threats to creditors.

Other factors that could exert upward pressure on the bank's BCA
in the medium term are (1) a sustainable recovery of asset-
quality indicators; and (2) an improved liquidity position, with
lower reliance on funding from monetary authorities.

An upgrade of the bank's debt and deposit ratings could be
triggered by an improvement in its standalone financial strength.

The bank's BCA could be adversely affected by (1) a greater-than-
expected deterioration in the bank's existing capital buffers;
(2) an additional capital requirement resulting from the ECB
stress test exercise that could not be met organically or through
management actions; (3) an unexpected deterioration in the bank's
profitability metrics; and (4) a material deterioration in its
liquidity or funding position.

Negative pressure on the bank's long-term debt and deposit
ratings could result from a lowering of the bank's BCA.


QUIRINUS PLC: Moody's Confirms 'Ba3' Rating on Class X2 Notes
-------------------------------------------------------------
Moody's Investors Service has confirmed the ratings of the Class
A and Class X2 Notes (the "Notes") issued by Quirinus (European
Loan Conduit No. 23) plc (ELoC 23) (amount reflecting the initial
outstanding amount):

Moody's rating action is as follows:

Issuer: Quirinus (European Loan Conduit No. 23) plc (ELoC 23)

EUR560M A Notes, Confirmed at Baa1 (sf); previously on Sep 26,
2013 Baa1 (sf) Placed Under Review for Possible Downgrade

X2 Notes, Confirmed at Ba3 (sf); previously on Sep 26, 2013 Ba3
(sf) Placed Under Review for Possible Downgrade

The Class A and Class X2 Notes were placed on review for possible
downgrade on 26 Sept 2013. Today's action concludes Moody's
review of the transaction.

Moody's does not rate the Class B, Class C, Class D, Class E or
Class F.

Ratings Rational

The confirmation at Baa1(sf) of the Class A Notes and Ba3(sf) of
the Class X2 Notes follows Moody's further review of the
transaction documentation in relation to the allocation of
recovery proceeds from the Eurocastle loan on a modified pro-rata
basis.

Moody's had expressed concern that the Class A could incur losses
in certain scenarios when the sequential payment trigger would
not be breached as expected. On further investigation of the
underlying transaction documentation and discussions with the
transaction parties including the calculation agent, Moody's has
determined that losses would only be incurred on the class A
Notes if the NAI amounts were sufficient to wipe out the class B
through F Notes irrespective of whether or not the sequential
payment trigger threshold has been reached. NAI amounts are
allocated in a reverse sequential order prior to available
proceeds being distributed to the Notes. As a result of this
structural feature, Moody's only envisages losses to the class A
Notes in a severe stress scenario.

FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING

Factors that would lead to a downgrade of the rating include
further capital value deterioration of the underlying collateral
which would result in increased loss expectation for the Notes.

MOODY'S PORTFOLIO ANALYSIS

Quirinus (European Loan Conduit No. 23) plc (ELoC 23) is a
securitisation of initially 10 loans that closed in July 2006.
Currently two loans remaining in the pool and are secured on
portfolios of in total 36 retail properties, for the most part
supermarkets, spread across Germany.

The portfolio is relatively concentrated with the largest loan,
the Eurocastle loan currently representing 78% of the securitized
balance. Moody's uses a variation of Herf to measure diversity of
loan size, where a higher number represents greater diversity.
This pool has a Herf of 1.5. Large multi-borrower transactions
typically have a Herf of less than 10 with an average of around
5.

The Eurocastle loan is currently performing and is scheduled to
mature in February 2016. The H&B loan is currently in special
servicing following a failure to repay at maturity in November
2012. The loan is currently in a standstill extension until
February 2014 whilst the borrower attempts to sell the underlying
properties.

Portfolio Loss Exposure: Moody's expects a significant amount of
losses on the securitized portfolio, stemming mainly from the
Eurocastle loan. Given the default risk profile and the
anticipated work-out strategy for potentially defaulting loans,
the expected losses are likely to crystallize only towards the
end of the transaction term.


* Moody's Review Irish Mortgage Bond Ratings for Downgrade
----------------------------------------------------------
Moody's Investors Service has taken rating actions on the
following ratings of Irish covered bonds, prompted by the
downgrade of the relevant issuer's senior unsecured ratings:

   - Mortgage covered bonds issued by AIB Mortgage Bank, a wholly
owned unlimited subsidiary of Allied Irish Banks p.l.c. (senior
unsecured rating B1; baseline credit assessment b2): Baa2, placed
on review for downgrade;

   - Mortgage covered bonds issued by Bank of Ireland Mortgage
Bank, a wholly owned unlimited subsidiary of Bank of Ireland
(senior unsecured rating Ba3; baseline credit assessment b1):
Baa2, placed on review for downgrade; and

   - Mortgage covered bonds issued by EBS Mortgage Finance, a
wholly owned unlimited subsidiary of EBS Ltd (senior unsecured
rating B1; baseline credit assessment b2): Baa3, placed on review
for downgrade.

The review will take into account the final form in which the
proposals under the Request for Comment (RFC) published on
Sept. 19, 2013.

RATINGS RATIONALE

The rating actions are prompted by the downgrade of the three
issuing banks' senior unsecured ratings on December 17 and 19,
2013 respectively. For further information on the rating actions
taken by Moody's Financial Institutions Group, please see
"Moody's downgrades Bank of Ireland's deposit rating to Ba2,
senior debt ratings to Ba3; outlook remains negative" and
"Moody's downgrades Allied Irish Banks' deposit rating to Ba3,
senior debt ratings to B1; outlook changed to stable" on
Moodys.com.

Moody's review of the covered bond ratings will incorporate all
available information, including the recent ECOFIN proposals.
Until Moody's completes its analysis of the available information
and the proposal, the rating agency intends to leave the above
covered bond ratings on review.

The "Timely Payment Indicators" (TPI)s assigned to the affected
covered bond programs remain "Improbable". Moody's TPI framework
may constrain the final rating of these covered bond programs
following its review.

The Credit Ratings of the covered bonds from AIB Mortgage Bank,
Bank of Ireland Mortgage Bank Covered Bond Programme and EBS
Mortgage Finance Covered Bond Programme were assigned in line
with Moody's existing Credit Rating Methodology entitled "Moody's
Approach to Rating Covered Bonds", published in July 2012.

Moody's notes that on Sept. 19, 2013, it published a Request for
Comment (RFC). In the RFC, the rating agency proposes an
adjustment to the anchor point it uses in its covered bond
analysis. If the revised Credit Rating Methodology is implemented
as proposed, the Credit Ratings of the covered bonds from AIB
Mortgage Bank, Bank of Ireland Mortgage Bank Covered Bond
Programme and EBS Mortgage Finance Covered Bond Programme may be
impacted relative to application of the existing Credit Rating
Methodology.

The rating that Moody's has assigned addresses the expected loss
posed to investors. Moody's ratings address only the credit risks
associated with the transaction. Moody's did not address other
non-credit risks, but these may have a significant effect on
yield to investors.

KEY RATING ASSUMPTIONS/FACTORS

Moody's determines covered bond ratings using a two-step process:
an expected loss analysis and a TPI framework analysis.

EXPECTED LOSS: Moody's uses its Covered Bond Model (COBOL) to
determine a rating based on the expected loss on the bond. COBOL
determines expected loss as (1) a function of the issuer's
probability of default (measured by the issuer's rating); and (2)
the stressed losses on the cover pool assets following issuer
default.

The cover pool losses are an estimate of the losses Moody's
currently models if the relevant issuer defaults. Moody's splits
cover pool losses between market risk and collateral risk. Market
risk measures losses stemming from refinancing risk and risks
related to interest-rate and currency mismatches (these losses
may also include certain legal risks). Collateral risk measures
losses resulting directly from the cover pool assets' credit
quality. Moody's derives collateral risk from the collateral
score.

For each program below, once the rating review concludes, Moody's
will reassess the minimum level of over-collateralization (OC)
required for the aforementioned programs to meet the maximum
rating achievable.

   --- AIB MORTGAGE BANK

The cover pool losses are 34.4%, with market risk of 27.7% and
collateral risk of 6.7%. The collateral score for this program is
currently 10.0%. The OC in this cover pool is 92.3% on a nominal
basis and 51.1% on a prudent market value (PMV) basis. The issuer
provides 5% PMV OC on a "committed" basis.

   --- BANK OF IRELAND MORTGAGE BANK COVERED BOND PROGRAMME

The cover pool losses are 35.3%, with market risk of 26.2% and
collateral risk of 9.1%. The collateral score for this program is
currently 13.6%. The OC in this cover pool is 74.2% on a nominal
basis and 37% on a PMV basis. The issuer provides 5% PMV OC on a
"committed" basis.

   --- EBS MORTGAGE FINANCE COVERED BOND PROGRAMME

The cover pool losses are 36.9%, with market risk of 30.2% and
collateral risk of 6.7%. The collateral score for this program is
currently 10.0%. The OC in this cover pool is 83% on a nominal
basis and 37% on a PMV basis. The issuer provides 5% PMV OC on a
"committed" basis.

The OC numbers are as of September 30, 2013.

For further details on cover pool losses, collateral risk, market
risk, collateral score and TPI Leeway across covered bond
programs rated by Moody's please refer to "Moody's EMEA Covered
Bonds Monitoring Overview", published quarterly. All numbers in
this section are based on the most recent Performance Overviews.

TPI FRAMEWORK: Moody's assigns a TPI, which indicates the
likelihood that the issuer will make timely payments to covered
bondholders if the issuer defaults. The TPI framework limits the
covered bond rating to a certain number of notches above the
issuer's rating. The TPIs assigned to these transactions remain
at "Improbable".

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

The issuer's credit strength is the main determinant of a covered
bond rating's robustness. The TPI Leeway measures the number of
notches by which Moody's might downgrade the issuer's rating
before the rating agency downgrades the covered bonds because of
TPI framework constraints. Currently, the TPI Leeways of AIB
Mortgage Bank and EBS Mortgage Finance Covered Bond Programme are
limited, and thus any downgrade of the issuer ratings may lead to
a downgrade of the covered bonds. The TPI Leeway for Bank of
Ireland Mortgage Bank Covered Bond Programme is 1 notch.

A multiple-notch downgrade of the covered bonds might occur in
certain limited circumstances, such as (1) a sovereign downgrade
negatively affecting both the issuer's senior unsecured rating
and the TPI; (2) a multiple-notch downgrade of the issuer; or (3)
a material reduction of the value of the cover pool.

RATING METHODOLOGY

The principal methodology used in these ratings was "Moody's
Approach to Rating Covered Bonds" published in July 2012.

Please note that on September 19, 2013, Moody's released a
Request for Comment, requesting market feedback in which it
proposes an adjustment to the anchor point it uses in its covered
bond analysis. If the revised Credit Rating Methodology is
implemented as proposed, the Credit Ratings of the covered bonds
may be affected.


* Moody's Says Irish RMBS Performance Still Weak in October 2013
----------------------------------------------------------------
The performance of the Irish prime residential mortgage-backed
securities (RMBS) market continued to show some sign of
stabilization but remained weak during the three-month period
leading to October 2013, according to the latest indices
published by Moody's Investors Service.

From July to October 2013, the 90+ and 360+ day delinquency trend
(which is used as a proxy for defaults) continued to rise to
19.1% from 18.6% and to 11.2% from 10.2%, respectively, of the
outstanding portfolios. However, 30+ day delinquencies are
increasing at a slower pace, and 60 to 90 day delinquencies are
showing signs of stabilization, which should lead to a further
stabilization in the increase in long-term arrears. At the same
time outstanding repossessions and cumulative losses kept rising
at elevated levels, coming from a very low basis. Moody's
annualized total redemption rate (TRR) trend was 3.0% in October
2013, similar to October 2012 level.

As of October 2013, 18 Moody's-rated Irish prime RMBS
transactions had an outstanding pool balance of EUR42.21 billion.
This constitutes a year-on-year decrease of 13.5% compared with
EUR48.81 billion for the same period in the previous year.



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


BANCA CARIGE: Moody's Retains Bonds Rating Over Amendments
----------------------------------------------------------
Moody's Investors Service has announced that the amendments to
the program documents of the commercial mortgage covered bond
program (Programme 2) of Banca Carige S.p.A. (deposits B3
negative, BFSR E/BCA caa2 negative) will not, in and of itself,
and at this time, result in a downgrade or withdrawal of the Baa2
covered bond ratings which are currently on review for downgrade.

Moody's opinion addresses only the credit impact of the
amendments, and Moody's is not expressing any opinion as to
whether the amendments have, or could have other, non-credit
related effects that may have a detrimental impact on the
interests of note holders and/or counterparties.

The amendments consist of:

1) an increase of the committed over-collateralization level to
32% from 10.5%.

2) an increase of the potential set-off amounts to 100% of the
set-off exposure (from 80%) in the Asset Coverage Test.

3) an increase in interests coverage in the funded liquidity
reserve to six months (formerly three months), in addition to one
month of senior expenses and EUR400,000 which were already
accounted for in the liquidity reserve.

Following the above-described amendments, Moody's says that the
revised terms of Banca Carige mortgage Covered Bond program 2
(commercial) will effectively reduce the probability of an
acceleration of the amortization test. Combined with the 32-year
maturity extension, these measures effectively reduce the
refinancing risks associated with the covered bonds in the event
of issuer default which is one of the key drivers in Moody's
Timely Payment Indicator (TPI). As a result, the rating agency
has raised the TPI to "Probable-High" from "Improbable".

In addition, the presence of a back-up servicer, which has
already been appointed, mitigates payment-disruption risk upon
issuer default, thus further reducing the acceleration risk in
Banca Carige mortgage Covered Bond program 2 (commercial).


BANCA MONTE: Hedging Structure Amendments No Impact on Ba1 Rating
-----------------------------------------------------------------
Moody's Investors Service has announced that the amendments to
the hedging structure of the residential mortgage covered bond
program of Banca Monte dei Paschi di Siena S.p.A. (deposits B2
negative, BFSR E/BCA caa3 negative) will not, in and of
themselves and at this time, result in a downgrade or withdrawal
of the bank's current Ba1 residential mortgage covered bond
ratings.

Moody's opinion addresses only the credit impact of the
amendments, and the rating agency is not expressing any opinion
as to whether the amendments have, or could have other, non-
credit related effects that may have a detrimental impact on the
interests of note holders and/or counterparties.

The hedging structure amendments consists of:

- The cancellation of the asset swap;

- Cancellation of four liability swaps for the following bonds:
   IT0004618226, IT0004721541, IT0004721558, IT0004721566;

- Novation of three liability swaps: the swap counterparty was
   internal and the counterparty is now UBS for bond
   IT0004689912, and Societe Generale for bonds IT0004702251 and
   IT0004689912 (tap issue);

- For the above-mentioned novated swaps, rating triggers have
   been lowered to A3/Prime 2 from A2/Prime 1 for the first
   rating trigger, and to Baa3/Prime 3 from A3/Prime 2 for the
   second rating trigger.

Following the hedging structure amendments, Moody's believes that
Banca Monte dei Paschi di Siena's residential mortgage covered
bond program will be exposed to higher interest-rate and basis
risks because the assets and liabilities will not benefit from
full hedging. The novation of some liability swaps is in itself
credit positive, although the lower rating triggers result in a
reduced protection to a downgrade event of the swap counterparty.
However, in Moody's opinion, the current level and form of over-
collateralization mitigates these risks.



===========
L A T V I A
===========


EXPOBANK AS: Moody's Assigns 'B1' Long-Term Deposit Rating
----------------------------------------------------------
Moody's Investors Service has assigned an E+ bank financial
strength rating (BFSR), B1 long-term deposit rating and Not-Prime
short-term deposit rating to AS Expobank. The BFSR and long-term
deposit ratings carry a stable outlook.

Ratings Rationale

Expobank's E+ BFSR, which equates to a baseline credit assessment
(BCA) of b1, reflects the strength of Expobank's business model
which combines low credit risk and strong capitalization, and
sees low liquidity risk with short duration on both sides of the
balance sheet. The rating is constrained by the bank's limited
franchise, earnings concentration in terms of number and origin
of clientele, and general lack of earnings predictability as a
result of the frequent turnover of its balance sheet.

Expobank's business model involves the provision of transactional
services to non-resident corporations and individuals, ultimately
mainly from Russia. This niche business segment limits the bank's
franchise in terms of market shares and proximity to customers,
with offices only in Riga, Latvia and Limassol, Cyprus. Revenues
are dependent on a narrow product offering, a relatively small
customer base and are hence largely dependent on the political
and economic conditions in the country of domicile of its
customers.

The bank operates by gathering short term deposits which are
generally used for clients' subsequent business transactions.
Funds are substantially invested in overnight or other short-term
accounts at predominantly strong banks; the bank only maintains a
small loan and securities portfolio. As such, the size of the
balance sheet can vary considerably depending on the transaction
volume at any point in time. Moody's views this variation, or
potential variation, as a key risk as it affects the bank's
capital adequacy, credit risk, operational risk and liquidity
profile. It further requires the bank to maintain strong
execution capabilities to ensure a continued transactional flow.
Moody's notes the bank's ambitious growth plans, which may
increase such challenges in the coming years.

Positively, the rating agency notes Expobank's relatively low
liquidity risk, given that its deposits and bank receivables are
typically very short-term, greatly reducing the duration mismatch
which is common in more traditional banks.

Moody's assesses Expobank's asset quality as generally strong
given that the majority of the credit risk it takes regards
aforementioned bank receivables rather than loans. The bank does
hold some limited loan assets on its balance sheet (LVL1.7
million at end-September 2013 compared to a total balance sheet
size of LVL168 million); at end-2012 none of these constituted
problem loans and Moody's understands that there has been no
significant change at end-September 2013. Expobank's bank
receivables are predominantly with relatively highly rated
European banks, so that its credit risk very closely reflects the
distribution of this asset class. As a policy, the bank limits
non-bank receivable credit risk (loans and a small securities
portfolio) to the size of its equity.

The low credit risk also means that the bank's capitalization is
very strong with a Tier 1 ratio at end-September 2013 of 69.4%.
Whilst this ratio will fluctuate given the variation in risk-
weighted assets, the level is currently strong enough to easily
withstand such variations (Expobank's minimum capital ratio is
20% under local regulator rules).

What Could Move the Ratings UP/DOWN

Upwards pressure could be generated following the bank's
successful management of its planned growth and the associated
key risks, including managing the potential volatility across the
bank's balance sheet. Sustained profitability and cost control
during any growth period would also be credit positive.

Downwards pressure on Expobank's ratings would likely follow any
significant increase in credit risk due to a more aggressive
approach to selecting its bank receivable counterparty mix, or
taking of other types of credit risk above the banks equity
level. It could also result from changes in the political or
economic environment which may weaken the franchise strength of
the bank still further.

The principal methodology used in this rating was Global Banks
published in May 2013.

Headquartered in Riga, Latvia, AS Expobank reported total
consolidated assets of LVL168 million (EUR236 million) at the end
of September 2013.



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


ELECTRAWINDS SE: Gets 3-Mo. Court Protection for Reorganization
---------------------------------------------------------------
Jim Silver at Bloomberg News reports that Electrawinds SE and its
Electrawinds NV unit received court protection for three months
to negotiate reorganization with creditors.

According to Bloomberg, Electrawinds SE said in a statement that
the court in Ostend, Belgium will appoint three trustees to
assist the board, replacing LDS NV and CEO Luc Desender on
corporate bodies.

Electrawinds SE is a Luxembourg-based energy company operating in
green energy production and design solutions to process organic
waste systems.  The Company designs, develops, constructs and
operates renewable energy plants that produce green energy from
wind, sunlight and biomass.  Electrawinds provides its services
to companies in Europe and Africa.



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


DEMIR-HALK BANK: Moody's Affirms 'Ba2' Deposit Ratings
------------------------------------------------------
Moody's Investors Service has affirmed the Ba2 deposit ratings
Demir-Halk Bank (Netherland) N.V. The rating agency has also
affirmed the bank's Not Prime short-term deposit ratings and
standalone D bank financial strength rating (BFSR), which is
equivalent to a baseline credit assessment (BCA) of ba2. The
outlook on the ratings is stable.

Ratings Rationale

The affirmation of the Demir-Halk Bank (Netherland) N.V.'s
ratings, with a stable outlook, reflects the bank's (1) niche
franchise in the competitive international trade-finance segment;
(2) concentrated corporate banking activities; (3) volatile
earnings profile with profitability gradually recovering over the
past two years; and (4) solid financial fundamentals in terms of
strong capital and liquidity, combined with a good and fairly
stable retail-driven funding profile.

Demir-Halk Bank (Netherland) N.V.'s profitability displays an
improving trend 2012 onwards, having again expanded its core
trade-finance and lending operations after it intentionally
contracted its loan book in response to the 2008-09 global
financial crisis that had resulted in weak bottom line
performance. Moody's expects this improved profitability to
remain sustainable on the back of the resumption of Demir Halk
Bank's lending activities and cost-cutting measures, and
improvement in the global economic outlook.

Demir-Halk Bank (Netherland) N.V.'s assigned ratings are
constrained both by the potential for earnings volatility and by
weak earnings quality, with a very marginal retail lending
franchise. Moody's regards retail lending as a banking activity
that attracts higher earnings given the granularity and the
benefits of cross-selling opportunities. In addition, Demir-Halk
Bank (Netherland) N.V. faces challenges in preserving a
sustainable market share. The bank's credit profile is also
evolving as its balance sheet is shifted towards corporate
lending activities and into those emerging geographic regions
that offer growth opportunities but are -- at the same time --
prone to volatility. The low granularity of Demir-Halk Bank
(Netherland) N.V.'s loan book and revenue base represents an
additional constraint -- the latter particularly resulting in
high tail risk.

The stable outlook on Demir-Halk Bank (Netherland) N.V.'s ratings
reflects the rating agency's expectation that the bank will
maintain its current financial profile against the headwinds
expected in emerging markets against the background of the
tapering of quantitative easing of the US Federal Reserve.

What Could Move the Rating UP/DOWN

Developments that could exert upwards pressure on Demir-Halk Bank
(Netherland) N.V.'s BFSR and deposit ratings include (1) the
bank's successful diversification of its consolidated assets and
earnings, coupled with a more stable geographic profile; (2)
strengthening of its lending franchise, particularly retail
activities that could positively contribute to the increased
granularity of its loan book profile and revenue stream; and (3)
sustained improvements in profitability.

Developments that would likely exert downwards pressure on Demir-
Halk Bank (Netherland) N.V.'s BFSR and deposit ratings include
(1) increases in its risk appetite that significantly increase
credit-risk costs; (2) any unexpected erosion of its deposit
base; (3) a decline in its capitalization ratios, rendering loss
absorption capacity vulnerable; (4) any evidence of increased
dependence on treasury trading revenues and volatile earnings;
(5) an increase in related-party lending; or (6) a weakening
profitability trend.

The principal methodology used in these ratings was Global Banks,
published in May 2013.


E-MAC DE 2006-II: Moody's Cuts Rating on EUR24.5MM Notes to Caa2
----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of classes B
and C in E-MAC DE 2006-II B.V., prompted by a correction to a
model input regarding the expected loss on the securitized
portfolio.

Issuer: E-MAC DE 2006-II B.V.

EUR35M B Notes, Downgraded to Ba3 (sf); previously on Dec 4,
2013 Downgraded to Ba1 (sf)

EUR24.5M C Notes, Downgraded to Caa2 (sf); previously on Dec 4,
2013 Downgraded to Caa1 (sf)

Ratings Rationale

The rating action takes into account the correction to an input
into the cash flow model used in the downgrade action of 4
December 2013, which followed worse-than-expected collateral
performance in the asset pool of E-MAC DE 2006-II.

The input that has been corrected is the expected loss on the
securitized portfolio: the expected loss initially input into the
model was 8.83% of the outstanding portfolio balance, whereas the
correct expected loss is 10.1% of the outstanding portfolio
balance, corresponding to 12% of the original portfolio balance.
The credit enhancement in the form of subordination and the
reserve fund currently amounts to 10.1% and 5.8% for classes B
and C, respectively.

Factors that Would Lead to an Upgrade or Downgrade of the Rating

- Factors or circumstances that could lead to an upgrade of the
   ratings are better performance of the underlying assets than
   Moody's expects and a decline in operational risk.

- Factors or circumstances that could lead to a downgrade of the
   ratings are higher delinquencies and realized losses on the
   underlying assets than Moody's expects and a decline in the
   credit quality of key transaction parties.


GREEN APPLE 2007-1: Moody's Ups Rating on EUR3MM C Notes From Ba1
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of Classes A
and C in Green Apple B.V. (2007-I NHG Portfolio) and upgraded the
ratings of Classes A, B and C in Green Apple B.V. (2008-I NHG
Portfolio). Also, Moody's has affirmed the ratings of Class B in
Green Apple B.V. (2007-I NHG Portfolio).

The upgrade of Class C in Green Apple 2007-I and Classes B and C
in Green Apple 2008-I concludes the review for upgrade initiated
on November 14, 2013.  The purpose of the review was to reassess
the linkage between swap counterparties and the credit quality of
the Notes using Moody's updated approach to assessing linkage to
swap counterparties in structured finance cash flow transactions:
"Approach to Assessing Swap Counterparties in Structured Finance
Cash Flow Transactions" published on the November 12, 2013. The
upgrade of Class A in both Green Apple transactions results from
a correction of the list of tranches potentially positively
affected by the updated methodology.

Ratings Rationale

The upgrade action was prompted by the reassessment of the
linkage between Royal Bank of Scotland Plc (A3/P-2) acting as
swap counterparty and the credit quality of the Notes, using
Moody's updated approach to assessing linkage to swap
counterparties in structured finance transactions. This updated
approach determines the rating impact on Notes exposed to swap
counterparties based on various factors. These factors include 1)
the rating of the swap counterparty; 2) the rating trigger
provisions in the swaps; 3) the type and tenor of the swap; 4)
the amount of credit enhancement supporting the Notes; 5) the
size of the relevant Note; and 6) the rating of the Notes before
linkage. In the case of Class A in both Green Apple 2007-I and
2008-I, the upgrade action reflects a correction of the list of
tranches potentially positively affected by the updated
methodology that were identified on November 14, 2013.

When the Notes ratings were initially assigned, their ratings
already incorporated an assessment of the swap counterparty
exposure. This assessment was more conservative than the approach
outlined in the new methodology. Although in both Green Apple
transactions the rating triggers are set at relatively low
levels, which creates extra linkage to the swap counterparty (the
collateral and transfer triggers are set at loss of Baa1 and loss
of Baa2, respectively), the amount of credit enhancement and size
of the relevant Notes has resulted in the upgrade of five Notes
in the two transactions.

The ratings in Green Apple B.V. (2007-I NHG Portfolio) also take
into account exposure to Royal Bank of Scotland Plc (A3/P-2)
acting as issuer account bank provider, which creates additional
linkage to Royal Bank of Scotland. There is a trigger in place in
the transaction to replace the issuer account bank when it loses
its short-term P-2 rating.

The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
November 2013. Factors that would lead to an upgrade or downgrade
of the rating

   - Factors or circumstances that could lead to an upgrade of
the ratings are lower realised losses and lower delinquency rates
on the underlying assets than Moody's expects and an improvement
in the quality of the key transaction parties.

   - Factors or circumstances that could lead to a downgrade of
the ratings are higher delinquencies and realized losses on the
underlying assets than Moody's expects and a decline in the
credit quality of key transaction parties.

List of Affected Ratings

Issuer: Green Apple B.V. (2007-I NHG Portfolio)

EUR1486.5M A Notes, Upgraded to A1 (sf); previously on Mar 19,
2012 Assigned A2 (sf)

EUR10.5M B Notes, Affirmed Baa1 (sf); previously on Mar 19, 2012
Assigned Baa1 (sf)

EUR3M C Notes, Upgraded to Baa3 (sf); previously on Nov 14, 2013
Ba1 (sf) Placed Under Review for Possible Upgrade

Issuer: Green Apple B. V. (2008-I NHG Portfolio)

EUR1925.6M A Notes, Upgraded to Aa1 (sf); previously on Aug 23,
2012 Assigned Aa3 (sf)

EUR29.65M B Notes, Upgraded to A3 (sf); previously on Nov 14,
2013 Baa2 (sf) Placed Under Review for Possible Upgrade

EUR19.75M C Notes, Upgraded to Baa2 (sf); previously on Nov 14,
2013 Ba1 (sf) Placed Under Review for Possible Upgrade


GROSVENOR PLACE: Moody's Hikes Rating on Class E Notes to 'Ba3'
---------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on the
following notes issued by Grosvenor Place CLO III B.V.:

EUR62,000,000 Class A-3 Senior Floating Rate Notes due 2023,
Upgraded to Aa1 (sf); previously on Jul 8, 2011 Upgraded to Aa2
(sf)

EUR36,500,000 Class B Deferrable Interest Floating Rate Notes due
2023, Upgraded to A1 (sf); previously on Jul 8, 2011 Upgraded to
Baa1 (sf)

EUR20,000,000 Class C Deferrable Interest Floating Rate Notes due
2023, Upgraded to A3 (sf); previously on Jul 8, 2011 Upgraded to
Baa3 (sf)

EUR28,500,000 Class D Deferrable Interest Floating Rate Notes due
2023, Upgraded to Ba1 (sf); previously on Jul 8, 2011 Upgraded to
Ba3 (sf)

EUR14,000,000 Class E Deferrable Interest Floating Rate Notes due
2023, Upgraded to Ba3 (sf); previously on Jul 8, 2011 Upgraded to
B2 (sf)

Moody's Investors Service has affirmed the ratings on the
following notes issued by Grosvenor Place CLO III B.V.:

EUR128,500,000 (outstanding balance of EUR123,933,629) Class A-1
Senior Floating Rate Notes due 2023, Affirmed Aaa (sf);
previously on Aug 30, 2007 Assigned Aaa (sf)

Up to EUR120,000,000 (outstanding balance of EUR121,921,203)
Class A-2 Senior Revolving Floating Rate Notes due 2023, Affirmed
Aaa (sf); previously on Aug 30, 2007 Assigned Aaa (sf)

Grosvenor Place CLO III B.V., issued in August 2007, is a
collateralized loan obligation (CLO) backed by a portfolio of
mostly high-yield senior secured European and US loans. The
portfolio is managed by CQS Cayman Limited Partnership. The
transaction's reinvestment period ended in October 2013.

Ratings Rationale

The rating action on the notes is primarily a result of the
benefit of the start of the amortization period in October 2013
and the improvement of the key credit metrics of the underlying
pool since the last rating action in July 2011.

In light of reinvestment restrictions during the amortization
period, and therefore the limited ability to effect significant
changes to the current collateral pool, Moody's analyzed the deal
assuming a higher likelihood that the collateral pool
characteristics would maintain an adequate buffer relative to
certain covenant requirements. In particular, Moody's assumed
that the deal will benefit from higher spread levels than it had
assumed prior to the end of the reinvestment period.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. In its base
case, Moody's analyzed the underlying collateral pool as having a
performing par and principal proceeds balance of EUR311.97
million, GBP33.69 million and US$91.09 million, defaulted par of
GBP1.6 million and US$1.22 million, a weighted average default
probability of 23.28% over 5.47 years (consistent with a 10 year
WARF of 2918), a weighted average recovery rate upon default of
48.79% for a Aaa liability target rating, a diversity score of
29.5 and a weighted average spread of 4.39%: The GBP end USD
denominated liabilities are naturally hedged by the GBP and USD
assets.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool. For a Aaa liability target rating,
Moody's assumed that a recovery of 50% of the 96.5% of the
portfolio exposed to first-lien senior secured corporate assets
upon default and of 15% of the remaining non-first-lien loan
corporate assets upon default. In each case, historical and
market performance and a collateral manager's latitude to trade
collateral are also relevant factors. Moody's incorporates these
default and recovery characteristics of the collateral pool into
its cash flow model analysis, subjecting them to stresses as a
function of the target rating of each CLO liability it is
analyzing.

Methodology Underlying the Rating Action:

The principal methodology used in this rating was "Moody's Global
Approach to Rating Collateralized Loan Obligations" published in
November 2013.

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

In addition to the base-case analysis, Moody's conducted
sensitivity analyses on the key parameters for the rated notes,
for which it assumed lower credit quality in the portfolio to
address refinancing risk. Loans to European corporates rated B3
or lower and maturing between 2013 and 2015 make up approximately
4.6% of the portfolio, which could make refinancing difficult.
Moody's ran a model in which it raised the base case WARF to
3034.68 by forcing ratings on 25% of the refinancing exposures to
Ca; the model generated outputs that were within one notch of the
base-case results.

This transaction is subject to a high level of macroeconomic
uncertainty, which could negatively affect the ratings on the
note, in light of 1) uncertainty about credit conditions in the
general economy 2) the exposure to lowly- rated debt maturing
between 2013 and 2015, which may create challenges for issuers to
refinance. CLO notes' performance may also be impacted either
positively or negatively by 1) the manager's investment strategy
and behavior and 2) divergence in the legal interpretation of CDO
documentation by different transactional parties due to because
of embedded ambiguities.

Additional uncertainty about performance is due to the following:

1) Portfolio amortization: The main source of uncertainty in this
transaction is the pace of amortization of the underlying
portfolio, which can vary significantly depending on market
conditions and have a significant impact on the Notes' ratings.
Amortization could accelerate as a consequence of high loan
prepayment levels or collateral sales or be delayed by an
increase in loan amend-and-extend restructurings. Fast
amortization would usually benefit the ratings of the notes
beginning with the notes having the highest prepayment priority.

2) Around 20.06% of the collateral pool consists of debt
obligations whose credit quality Moody's has assessed by using
credit estimates. As part of its base case, Moody's has stressed
large concentrations of single obligors bearing a credit estimate
as described in "Updated Approach to the Usage of Credit
Estimates in Rated Transactions," published in October 2009 and
available at https://www.moodys.com/research/Updated-Approach-to-
the-Usage-of-Credit-Estimates-in-Rated--PBC_120461.

3) Recovery of defaulted assets: Market value fluctuations in
trustee-reported defaulted assets and those Moody's assumes have
defaulted can result in volatility in the deal's over-
collateralization levels. Further, the timing of recoveries and
the manager's decision whether to work out or sell defaulted
assets can also result in additional uncertainty. Moody's
analyzed defaulted recoveries assuming the lower of the market
price or the recovery rate to account for potential volatility in
market prices. Recoveries higher than Moody's expectations would
have a positive impact on the notes' ratings.

4) Foreign currency exposure: The deal has a significant exposure
to non-EUR denominated assets. Volatility in foreign exchange
rates will have a direct impact on interest and principal
proceeds available to the transaction, which can affect the
expected loss of rated tranches.

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



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


ALBAIN MIDCO: Moody's Changes Outlook to Neg. & Affirms B2 CFR
--------------------------------------------------------------
Moody's Investors Service changed to negative from stable the
outlook on the ratings assigned to Albain Midco Norway AS
('Midco'), a holding company of the EWOS group ('EWOS'), a
leading salmonid feed producer for the aquaculture industry, and
its wholly owned subsidiary Albain Bidco Norway AS ('Bidco').

Concurrently, Moody's has affirmed Midco's B2 corporate family
rating (CFR) and B2-PD probability of default rating (PDR). In
addition, the rating agency has assigned definitive B2 ratings
with a loss-given default (LGD) assessment of LGD 4 to the EUR225
million of senior secured notes due 2020 and NOK1.810 billion
(EUR224 million) of senior secured floating-rate notes due 2020
issued by Bidco, as well as a definitive Caa1 rating (LGD 6) to
its NOK1.040 billion (EUR128 million) of senior subordinated
notes.

Ratings Rationale

The change in outlook reflects that EWOS was subject to adverse
operational developments during the key third quarter period
ended 30 September, including a significant and unexpected loss
in volumes from a key customer. Moody's expects that these
developments will weaken EWOS's 2013 and 2014 debt protection
ratios beyond the parameters that had been initially set for the
ratings.

EWOS's EBITDA decreased by approximately 21% to NOK500 million
(EUR65 million) in the first nine months of 2013 because of lower
volumes and operating expenses that were greater than the company
had anticipated. Whilst the underperformance was partly a result
of colder water temperatures in Norway in the first half of the
year, EWOS also suffered a drop in volumes following reduced
demand from one of its key customers. As this occurred during the
peak season, EWOS said it was unable to adjust its cost base
sufficiently quickly to adjust to the reduced demand.

Given the magnitude of the volume loss, Moody's believes that, to
maintain the current B2 ratings, EWOS will have to demonstrate
that it can fill in the spare capacity and increase its operating
margins during 2014 . At this juncture, Moody's estimates that
EWOS's adjusted (gross) debt/EBITDA ratio could fall between 6.0x
and 6.5x in 2014, above the threshold that the rating agency had
set for downward pressure on the rating.

Rationale for Negative Outlook

The negative outlook on the ratings reflects Moody's expectation
that EWOS's deleveraging trajectory will deviate from what the
rating agency had initially anticipated. It further reflects the
rating agency's expectation that it will likely take time for the
company to recoup the volumes lost and to rebuild a financial
profile commensurate with its B2 ratings.

What Could Change The Rating UP/DOWN

A downgrade of the ratings could occur if EWOS is unable to
recoup the volumes lost and to improve its profitability in the
course of 2014. In addition, negative pressure could materialize
if, for example, (1) the company loses a major contract; (2)
there is more intense competitive pressure, or a weakening in
salmon industry fundamentals; (3) the company pursues an
aggressive corporate strategy; or (4) its liquidity profile
deteriorates.

In light of the change in outlook, an upgrade of the ratings is
not likely in the near term. To stabilize the outlook, Moody's
would expect EWOS to succeed in increasing its volumes such that
it regains the ground that it has lost in recent months and
pursues its cost-saving initiatives, translating into an adjusted
(gross) debt/EBITDA ratio trending towards 5.5x.

Moody's could consider upgrading EWOS's rating if the company
sustains its profitability margins and pursues a path of steady
deleveraging whilst maintaining an adequate liquidity position.
Quantitatively, an upgrade would require adjusted debt/EBITDA to
decrease towards 4.5x and an adjusted EBITA/interest expense
ratio above 2.0x, on a sustainable basis.

Headquartered in Norway, EWOS is a leading salmonid feed producer
for the aquaculture industry with operations in the principal
salmonid farming markets (Norway, Chile, Canada and Scotland).
EWOS produces extruded pellets for salmonids (Atlantic salmon,
coho salmon, rainbow trout and Chinook). It posted total revenue
of NOK10.28 billion (approximately EUR1.2 billion) in the
financial year ended December 31, 2012.


SONGA OFFSHORE: Moody's Affirms 'Caa1' CFR; Outlook Stable
----------------------------------------------------------
Moody's Investors Service has upgraded Songa Offshore SE's
probability of default rating (PDR) to Caa1-PD/LD from Ca-PD.
Concurrently, the rating agency has affirmed the Caa1 corporate
family rating (CFR) and revised the outlook to stable.

Ratings Rationale

The assignment of the /LD indicator to the PDR follows the
company's approval at an extraordinary general meeting of the
debt refinancing and restructuring plan announced in November.
The company has already fulfilled all other conditions for the
plan including: (1) amendments to the existing CAT-D charter
contracts, (2) waivers and amendment agreements with bondholders
as well as (3) amended agreements for the company's bank
facility. Moody's expects to remove the "/LD" indicator after
approximately three business days.

The affirmation of the CFR and the upgrade of the PDR reflects
Songa's improved maturity and liquidity profile resulting from
the recapitalization and refinancing. The amendments to the bank
facilities and bonds as well as the changes to the vendor loan
from Statoil ASA (Aa2 stable) has reduced the company's
refinancing needs for 2014-2016 by US$536 million, excluding a
US$25 million repair offer. Part of the debt reduction involves
pre-payments in the fourth quarter this year of US$111 million of
the Statoil loan and US$50 million of the pre-delivery loan for
the CAT-D1 & 2 rigs in the first quarter 2014. The remaining
reduction in 2014-2016 requirements is related to the extension
of the bonds maturing in 2015 and 2016 to 2018. The ratings also
reflect the substantial changes to senior management during 2013,
with a new CEO, CFO and COO.

Following the equity and bond issuance, Moody's views Songa's
liquidity as adequate for its needs over the next 12 months and
assumes that financing for the CAT-D 1 & 2 rigs is put in place.
Moody's views the proceeds of the US$250 million equity and
US$150 million convertible bond issuance as enough to enable the
company to fund Songa Dee's SPS scheduled in Q3 2014. This should
resolve one of the reasons that the CFR was downgraded to Caa1 in
October this year. Moreover, covenant headroom should now be
adequate following the covenant amendments.

The rating agency notes that the company continues to work on a
number of initiatives in order to strengthen its balance sheet,
including possible sales of its Mercur and Venus rigs. However,
the Caa1 rating reflects the fact that although the company's
liquidity profile has strengthened following the restructuring,
final financing documentation for the CAT-D 1 & 2 rigs is not yet
in place and the company has just started the process for the
CAT-D 3 & 4 rigs. Additionally, the company will be reliant on
successful operation of three rigs all contracted to Statoil
until 2016, if the two other rigs are sold. Should the company
manage to meet its liquidity needs through to successful
commissioning of the Cat-D rigs, its financial position from 2015
onwards should be significantly improved although it will remain
highly leveraged, with Moody's expecting leverage to remain above
8.0x through 2015.

The ratings reflects the remaining financing gap of US$1 billion
required for the CAT-D 3 & 4 delivery due in the first half of
2015 as well as being constrained by the risks associated with
four new rigs under construction, as well as delivery and ramp-
up, in light of Moody's view of Songa's limited experience with
this situation with so many rigs.

Rating Outlook

The stable outlook assumes that Songa will be able to meet its
obligations over the next twelve months, supported by the
company's firm contract backlog of over US$6 billion, that the
CAT-D rigs will be delivered without further delays, and there
will be no further deterioration in operating performance.

WHAT COULD CHANGE THE RATING UP/DOWN

There could be positive pressure if Moody's expects leverage to
fall sustainably under 6.0x (following successful commissioning
of the four CAT-D rigs), with sufficient headroom under the debt
covenants and a stronger overall liquidity profile, including
signed financing for all CAT-D rigs. The ratings could be lowered
if earnings deteriorate, or if additional liquidity concerns
emerge such that the conditions for a stable outlook may not be
met.

PRINCIPAL METHODOLOGY

The principal methodology used in this rating was the Global
Oilfield Services Rating Methodology published in December 2009.

Songa, established in Norway in 2005 and listed on the Norwegian
stock, has grown rapidly through both acquisitions and some
re-commissioning of second-hand floaters and currently has a
fleet of five.


SONGA OFFSHORE: S&P Raises CCR to 'B-'; Outlook Negative
--------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term corporate
credit rating on Cyprus-domiciled drilling company Songa Offshore
S.E. to 'B-' from 'D' (default).  The outlook is negative.

The upgrade follows Songa's implementation of an extensive debt
restructuring in line with its previously announced plans, and
following all of the necessary formal approvals from its
stakeholders.  S&P understands that Songa has received
US$400 million of new capital, and that amendments to Songa's
existing bank and bond debt are now in effect.  S&P viewed these
amendments as tantamount to an event of default under our
criteria.

In S&P's view, the amendments to Songa's bank and bond debt have
benefited Songa's long-term capital structure and helped to
relieve its immediate liquidity issues.  However, S&P notes that
Songa's financing for four new Cat-D rigs that it has on order
has not yet been concluded, although S&P understands that funding
for the first two rigs, which are due to be delivered in the last
quarter of 2014, will be finalized early in 2014.

S&P understands that Songa has received US$400 million of new
capital -- a US$250 million equity issue through a private
placement (with a further US$25 million to be raised in the first
quarter of 2014), and a US$150 million convertible bond.
Furthermore, international oil and gas producer Statoil ASA and
its partners have agreed improved terms on their existing charter
agreements with Songa, in return for Songa's early repayment of
the US$222 million vendor loan due to Statoil.

"We assess Songa's business risk profile as "weak," reflecting
Songa's exposure to the highly cyclical and competitive offshore
drilling industry.  Furthermore, we consider Songa's competitive
position to be "weak," as a result of the group's moderate fleet
size, and low diversification geographically and by customer.  We
view as supportive rating factors Songa's sizable revenue backlog
(US$6.6 billion, with another US$8.4 billion worth of options as
of Sept. 30, 2013), and good revenue and cash flow visibility
through multi-year contracts with Statoil," S&P said.

"We assess Songa's financial risk profile as "highly leveraged,"
reflecting Songa's highly debt leveraged capital structure, as a
result of the capital-intensive nature of the offshore drilling
industry, and the group's expansion strategy.  Songa's sizable
capital expenditure (capex) plans, including the four new rigs on
order, is leading to negative forecast free cash flow.  We do not
net surplus cash from debt in our credit metrics for companies
with "weak" business risk profiles," S&P added.

S&P views Songa's management and governance as "weak" (including
high management turnover), although this does not modify S&P's
'B-' rating on Songa.  S&P's opinion of Songa's management and
governance may improve over the medium term if the new management
team establishes a better track record of managing liquidity.

S&P's base-case operating scenario for Songa assumes:

   -- A significant (about 20%-25%) contraction in operating
      revenues in 2014, assuming that the group sells its Songa
      Venus and Songa Mercur rigs as planned.  The Songa Dee rig
      will be out of action for about 60 days in the third
      quarter of 2014 for its special periodic survey.  S&P
      assumes that average utilization rates on the three
      remaining rigs on order will remain high, and that there
      will not be any further delays in delivery of the four new
      Cat-D rigs, due in the fourth quarter of 2014 and the
      second quarter of 2015.

   -- Revenues will ramp up again once all four Cat-D rigs are
      in action in 2015 and 2016.

   -- Much reduced EBITDA and cash generation in line with a
      revenue drop.

   -- Capex of US$1.1 billion per year in 2014 and 2015, to fund
      the four new Cat-D rigs.

   -- New capital of US$400 million following the debt
      restructuring, but US$272 million of pre-delivery loan
      repayments to Statoil relating to the third and fourth
      Cat-D rigs, and US$35 million of prepayments when Songa
      Venus and Songa Mercur are sold.  S&P anticipates net cash
      of about US$200 million for these rigs.

   -- Much reduced debt maturity payments of US$57 million per
      year in 2014 and 2015.

   -- No further rig purchases.

   -- Very low cash tax payments.

   -- No dividend payments.

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

   -- Stable EBITDA margins of 30%-35%.

   -- A significant deterioration in credit metrics in 2014,
      following the sale of two existing rigs, including a
      forecast drop in Standard & Poor's-adjusted funds from
      operations (FFO) to debt to about 5%.

   -- Negative free cash flow generation due to sizable capex
      plans, including the four rigs on order.

The negative outlook primarily reflects S&P's understanding that
financing for new Cat-D rigs due in late 2014 has yet to be
finalized.  That said, S&P forecasts that utilization rates on
Songa's available rigs will remain high, and that it should
generate sufficient cash flow to meet reduced interest and
amortization payments in the near term.

                         Downside scenario

S&P could lower the rating if Songa's prospective liquidity
position deteriorates.  For example, this could occur if Songa
does not manage to finalize the funding on the first two Cat-D
rigs by early 2014.

S&P could also lower the rating if Songa's operating performance
weakens further; its financial flexibility is constrained; or if
we see heightened risks regarding management or corporate
governance issues.

                          Upside scenario

Songa's "weak" liquidity profile caps the rating at 'B-'.  If
Songa finalizes the funding on the first two Cat-D rigs as it
expects, this would significantly improve the group's ratio of
liquidity sources to uses in the immediate term.  However, the
final payments due on the last two Cat-D rigs will enter S&P's
liquidity calculations from the second quarter of 2014.
Therefore, it is unlikely that S&P will revise its liquidity
profile descriptor until funding for all four rigs is finalized.

Corporate Credit Rating: B-/Negative/--

Business risk: Weak
   -- Country risk: Low
   -- Industry risk: Intermediate
   -- Competitive position: Weak

Financial risk: Highly leveraged
Cash flow/Leverage: Highly leveraged
Anchor: 'b-'
Modifiers

   -- Diversification/portfolio effect: Neutral (no impact)
   -- Capital structure: Neutral (no impact)
   -- Liquidity: Weak (no impact)
   -- Financial policy: Neutral (no impact)
   -- Management and governance: Weak (no impact)
   -- Comparable rating analysis: Neutral (no impact)

Ratings List

Upgraded; CreditWatch/Outlook Action
                                        To                 From
Songa Offshore SE

Corporate Credit Rating                B-/Negative/--   D/--/--



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


ASKOLD: Russia's Central Bank Revokes Operating License
-------------------------------------------------------
RIA Novosti reports that Russia's central bank said Tuesday it
had revoked the operating license of Askold, the latest in a
string of enforced closures by the regulator.

According to RIA Novosti, the closures are part of a drive by the
authorities to crack down on financial irregularities in the
banking sector among small and mid-sized banks, many of which are
little more than corporate treasuries.

Askold was a small Russian commercial bank.  Askold, ranked
511th, was a subsidiary of the larger Smolensk Bank that was
stripped of its license earlier this year.


BETALINK: Court of Appeal Rejects MTS' Suit v. Former CEO
---------------------------------------------------------
PRIME, citing RIA Novosti's agency for legal and court
information RAPSI, reports that Russia's Ninth Arbitration Court
of Appeal has rejected a lawsuit filed by major mobile operator
MTS seeking to recover RUR914.7 million from Marina Kovalyova,
former CEO of Betalink.

The court has thus upheld a ruling issued by the Moscow
Arbitration Court in September, PRIME relays.

MTS, which is the Betalink's bankruptcy creditor, sought to
recover funds in favor of Betalink, which applied for bankruptcy
in March 2009 and was declared bankrupt in February 2010, PRIME
relates.

According to PRIME, MTS' lawyer said that Ms. Kovalyova failed to
file a bankruptcy motion in 2008, when the company had a net
loss.  As the result, Betalink's debt increased to
RUR5.37 billion in 2010, while the retailer's receivables were
estimated at RUR775.9 million, about RUR200 million of which
could be collected, PRIME discloses.

A lawyer of Betalink's bankruptcy supervisor said earlier that
according to a report submitted to the court, an individual could
not be brought to the subsidiary responsibility for such a huge
sum, PRIME recounts.

The court ruled that MTS failed to prove that Betalink's
bankruptcy was caused by Ms. Kovalyova's actions, according to
PRIME.  The court said that in addition, there is no sufficient
evidence that Betalink had been driven to bankruptcy
intentionally, PRIME notes.

Betalink is a Russian mobile phone retailer.


HMS HYDRAULIC: S&P Keeps 'B' Rating on CreditWatch Negative
-----------------------------------------------------------
Standard & Poor's Rating Services said that it is keeping its 'B'
long-term credit rating and 'ruA' Russia national scale rating on
Russia-based pump and oil and gas equipment manufacturer HMS
Hydraulic Machines and Systems Group PLC (HMS) on CreditWatch
with negative implications.  S&P had placed the ratings on
CreditWatch negative on Oct. 31, 2013.

The 'B-' issue rating on the Russian ruble (RUB) 6 billion notes
issued by HMS' subsidiary CJSC Hydromashservice also remains on
CreditWatch negative.  The 'ruA-' Russia national scale rating on
these notes remains unchanged.  The recovery rating on the notes
is also unchanged at '5', indicating S&P's expectation of modest
(10%-30%) recovery in the event of a payment default.

The ratings remain on CreditWatch, primarily owing to the ongoing
pressure on HMS' "less than adequate" liquidity, which stems from
its sizable RUB3 billion short-term debt maturities over the 12
months following Sept. 30, 2013.  However, S&P expects that HMS
will complete its refinancing within the next three months.
While the headroom under its maintenance covenant has narrowed,
S&P do not anticipate a covenant breach at the end of 2013.
However, S&P thinks that covenant pressure could build up again
in 2014 if HMS does not reset its covenant over the coming
months.

S&P aims to resolve the CreditWatch status within next three
months.  The rating affirmation will depend on HMS' ability to
refinance its short-term debt maturities.  S&P will also monitor
any possible amendment to the maintenance covenant, which S&P
thinks could become a risk factor in 2014.

The CreditWatch also reflects a possibility of S&P lowering the
long-term corporate credit rating on HMS by one notch to 'B-' and
the Russian national scale rating on HMS by two notches to
'ruBBB+'.  This could materialize if HMS is unable to face its
refinancing needs over the next three months.  In this case, S&P
may also revise its assessment of HMS' liquidity downward to
"weak" from "less than adequate."

Ratings upside would depend on HMS' ability to generate positive
free operating cash flow, and keep its adjusted leverage below
3.0x.  It will also depend on the company's ability to maintain
an adequate liquidity cushion.


MORTGAGE AGENT: Funds Transfer to Credit Europe No Ratings Impact
-----------------------------------------------------------------
Moody's Investors Service has determined that cash transfer to
the account with the Credit Europe Bank Ltd. ("CEB", Ba3) would
not, in and of itself and as of this time, result in the
downgrade or withdrawal of the current ratings of the notes (the
"Notes") issued by CJSC "Mortgage Agent Europe 2012-1", (the
"Issuer").

The Issuer has accumulated unused funds of approximately RUB100
million on the Issuer account with ZAO Citibank due to the first
calculation period in the transaction being shorter than the
first collection period. These funds do not form part of the
collections accumulated during the calculation period and, as a
result, will not be distributed to the notes until the legal
final maturity or the full redemption of the notes.

The amendment would permit a one-time transfer of RUB100 million
to the bank account in the name of the Issuer held with Credit
Europe Bank (Ba3), who is acting as a servicer in the
transaction. The Issuer can request to transfer the money back to
the Issuer collateral account with ZAO Citibank at any time and
it will be transferred back to this account within a day of
request. The amount will also be transferred to the Issuer
collateral account on the legal final maturity of the transaction
or upon an early redemption of the notes to enable the payment of
this amount to the notes.

Moody's has taken into account in the modeling the increased
commingling risk associated with RUB100 million being held in an
account with CEB and has determined that the amendment, in and of
itself and at this time, will not result in the downgrade or
withdrawal of the rating currently assigned to notes issued by
CJSC "Mortgage Agent Europe 2012-1". Moody's opinion addresses
only the credit impact associated with the proposed amendment,
and Moody's is not expressing any opinion as to whether the
amendment has, or could have, other non-credit related effects
that may have a detrimental impact on the interests of note
holders and/or counterparties.

The last rating action for CJSC "Mortgage Agent Europe 2012-1"
was taken on October 1, 2013 when definitive ratings were
assigned to the notes.


RYBLYOVSKY BANK: Central Bank Revokes License After Default
-----------------------------------------------------------
Itar-Tass reports that Russia's Central Bank (CBR) on Dec. 24
said in a release that it has stripped Commercial Bank Ryblyovsky
of license.

According to Itar-Tass, the bank's license has been revoked for
breaching "federal banking laws, regulatory acts of the Bank of
Russia, as well as the bank's failure to satisfy the creditors'
claims on money liabilities."

Due to the loss of liquidity, Commercial Bank Rublyovsky failed
to timely fulfill its obligations to creditors, Itar-Tass
discloses.  Moreover, the bank pursued a high-risk credit policy
and did not create reserves for possible losses on loan
indebtedness and other assets that would be adequate to the
accepted risks, Itar-Tass notes.  The bank was also involved in
suspicious transactions, Itar-Tass relays.  The leadership and
owners of CB Rublyovsky failed to take effective measures to
restore its financial position," the RF Central Bank stated,
Itar-Tass says.

Temporary administration has been appointed at CB Rublyovsky
until the appointment of a bankruptcy manager of liquidator,
Itar-Tass discloses.  According to Itar-Tass, the powers of the
executive bodies of the credit institution are suspended, in
accordance with federal laws.

By the size of its assets, Commercial Bank Ryblyovsky was 669th
in the Russian banking system as of December 1, 2013.



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


MERKUR: Declared Insolvency; Files for New Debt Restructuring
-------------------------------------------------------------
Slovenia Times reports that Merkur has declared insolvency and
has proposed to begin a new court-mandated debt restructuring.

According to Slovenia Times, the company said that the new
procedure would only affect claims subject to the previous debt
restructuring.

The company has paid off some EUR170 million in liabilities over
the past three years but it is still saddled with EUR280 million
in debt, a vestige of a failed leveraged management buyout that
has left the company at the verge of survival and landed former
executives in jail, Slovenia Times discloses.

Despite the deleveraging and a standstill agreement with banks,
the company will be unable to pay back creditors EUR21 million by
the end of the year as per the restructuring plan, as this would
leave it with a fatal shortfall of current assets, Slovenia Times
notes.

Merkur is a Slovenian hardware retailer.



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


* Moody's Says Spanish SME ABS Delinquency High in September 2013
-----------------------------------------------------------------
The performance of Spanish asset-backed securities backed by
loans to small and medium-sized enterprises (SME ABS) remained
poor in September 2013, according to the latest indices published
by Moody's Investors Service.

The 90-360 day delinquency rate reached 5.67% in September 2013,
up both from 4.56% in September 2012, and also -- albeit
marginally -- from 5.49% in June 2013. As in second quarter 2013,
the transactions issued by Santander show a high and increasing
90-360 day delinquency rate while also representing the biggest
part of the index.

Nevertheless, Moody's notes that 60 to 90 day delinquencies
remained on a decreasing trend at 1.69% in September 2013, from
their October 2012 level of 2.16%. Thus, lower incoming
delinquencies over the past year will stabilize the 90-360 day
delinquencies going forward. As of June 2013, 59 transactions
have drawn their reserve fund, nine of which reported a principal
deficiency ledger and a fully depleted reserve fund.

The performance of Spanish SME ABS transactions is expected to
remain poor, due to tight credit supply and banks' regional
branch closures. Consequently, Moody's outlook for Spanish SME
ABS remains negative for 2014 (see Related Research).

As of September 2013, the portfolio of Spanish SME ABS contains
72 outstanding transactions, for a total of EUR25,232 million,
compared with EUR38,290 million in September 2012.



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


CRIMEA: S&P Revises Outlook to Stable & Affirms 'B-' ICR
--------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Ukraine's Autonomous Republic of Crimea to stable from negative
and affirmed its 'B-' long-term issuer credit rating and 'uaBBB-'
Ukraine national scale rating.

                             RATIONALE

The outlook revision follows a similar action on Ukraine on
Dec. 26, 2013.

"We assess Crimea's indicative credit level (ICL) at 'b'.  The
ICL is not a rating.  It is a means of assessing a local or
regional government's (LRG's) intrinsic creditworthiness under
the assumption that there is no sovereign rating cap.  The ICL
results from the combination of our assessment of an LRG's
individual credit profile and the effects we see of the
institutional framework in which it operates," S&P noted.

The rating on Crimea incorporates S&P's assessments of its low
debt, conservative debt policies, and sound financial performance
in recent years.  S&P also factors in its view that Crimea lacks
revenue predictability and has very low budgetary flexibility in
terms of revenues and expenditures.  Crimea relies heavily on
subsidies and excise tax revenues and has high expenditure needs,
due in S&P's view to the "volatile and underfunded" Ukrainian
institutional framework.  Crimea has low wealth levels, weak
financial management practices, negative liquidity, and
contingent liabilities related to its municipalities and
companies.

Under S&P's methodology, an LRG can be rated higher than its
sovereign only if it considers that it exhibits certain
characteristics.  S&P do not currently believe that Ukrainian
LRGs, including Crimea, meet these conditions.  S&P consequently
caps the long-term rating on Crimea at the level of the long-term
rating on Ukraine.

                              OUTLOOK

The stable outlook on Crimea reflects the stable outlook on
Ukraine.  S&P would take positive rating actions on Crimea if it
took positive actions on Ukraine and if other rating factors
developed in line with its base-case scenario.

S&P might lower the ratings on Crimea if it lowered the ratings
on Ukraine.

Even if the sovereign ratings remain unchanged, S&P could
consider a negative rating action on Crimea in the unlikely case
that its performance and liquidity substantially weakened ahead
of its June 2014 bond repayment, for example because of setbacks
in revenue performance.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.  The chair
ensured every voting member was given the opportunity to
articulate his/her opinion.  The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook.

RATINGS LIST

Outlook/CreditWatch Action; Ratings Affirmed
                                        To                 From
Crimea (Autonomous Republic of)
Issuer Credit Rating               B-/Stable/--   B-/Negative/--
Ukraine National Scale Rating      uaBBB-/--/--   uaBBB-/--/--


DNIPROPETROVSK CITY: S&P Revises Outlook & Affirms 'B-' ICR
-----------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on the
Ukrainian City of Dnipropetrovsk to stable from negative.  At the
same time, S&P affirmed its 'B-' long-term issuer and 'uaBBB-'
Ukraine national scale credit ratings.

                             RATIONALE

The rating action follows S&P's similar action on the sovereign
on Dec. 26, 2013.

Under S&P's methodology, a local and regional government (LRG)
can be rated higher than its sovereign if it believes that it
exhibits certain characteristics, as described in "Methodology:
Rating A Regional Or Local Government Higher Than Its Sovereign,"
published Sept. 9, 2009. These include:

   -- The ability to maintain stronger credit characteristics
      than the sovereign in a stress scenario.  This includes,
      among other factors, lack of dependence on the sovereign
      for any applicable share of its revenues and a wealthier
      and more diversified economy than the sovereign as a whole;

   -- An institutional framework that limits the risk of negative
      sovereign intervention; and

   -- The ability to mitigate negative sovereign intervention
      through financial flexibility and independent treasury
      management.

S&P do not currently believe that Ukrainian LRGs, including
Dnipropetrovsk, meet these conditions.

The long-term rating on Dnipropetrovsk is capped at 'B-' by the
Ukrainian sovereign foreign currency rating.  However, in
accordance with S&P's criteria, it assess Dnipropetrovsk's
indicative credit level (ICL) at 'b'.

The ratings on Dnipropetrovsk reflect Ukraine's "volatile and
underfunded" public finance system resulting in the city's low
financial flexibility and predictability, what S&P regards as
"negative" financial management, significant contingent
liabilities related to municipal utilities, and a poor and
concentrated economy.  These constraints are mitigated by
Dnipropetrovsk's low debt burden, strong financial support from
the central government, moderate budgetary performance, and
"neutral" liquidity.

                              OUTLOOK

The stable outlook on Dnipropetrovsk reflects that on Ukraine.

Because the rating on the city is capped at the sovereign rating,
any rating action on Ukraine would likely lead to a similar
action on Dnipropetrovsk, all else being equal.  S&P currently do
not see a viable downside scenario for the city's ICL.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.  The chair
ensured every voting member was given the opportunity to
articulate his/her opinion.  The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook.

RATINGS LIST

Outlook/CreditWatch Action; Ratings Affirmed
                                      To           From
Dnipropetrovsk (City of)
Issuer Credit Rating                 B-/Stable/-- B-/Negative/--
Ukraine National Scale Rating        uaBBB-/--/-- uaBBB-/--/--
Senior Unsecured
   Global Scale                       B-           B-
   Ukraine National Scale             uaBBB-       uaBBB-


IVANO-FRANKIVSK: S&P Revises Outlook to Stable & Affirms 'B-' ICR
-----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on the
Ukrainian City of Ivano-Frankivsk to stable from negative.  At
the same time, S&P affirmed its 'B-' long-term issuer and
'uaBBB-' Ukraine national scale credit ratings.

Rationale

The rating action follows S&P's similar action on the sovereign
on Dec. 26, 2013.

Under S&P's methodology, a local and regional government (LRG)
can be rated higher than its sovereign if we believe that it
exhibits certain characteristics, as described in "Methodology:
Rating A Regional Or Local Government Higher Than Its Sovereign,"
published Sept. 9, 2009.  These include:

   -- The ability to maintain stronger credit characteristics
      than the sovereign in a stress scenario.  This includes,
      among other factors, lack of dependence on the sovereign
      for any applicable share of its revenues and a wealthier
      and more diversified economy than the sovereign as a whole;

   -- An institutional framework that limits the risk of negative
      sovereign intervention; and

   -- The ability to mitigate negative sovereign intervention
      through financial flexibility and independent treasury
      management.

S&P do not currently believe that Ukrainian LRGs, including
Ivano-Frankivsk, meet these conditions.

The long-term rating on Ivano-Frankivsk is therefore capped at
'B-' by the Ukrainian sovereign foreign currency rating.
However, in accordance with S&P's criteria, it assess the city's
indicative credit level (ICL), as defined by its criteria, at
'b'.

The ICL is not a rating, but a means of assessing an LRG's
intrinsic creditworthiness under the assumption that there is no
sovereign rating cap.  The ICL results from the combination of
S&P's assessment of an LRG's individual credit profile and the
effects it sees of the institutional framework in which it
operates.

The ratings on Ivano-Frankivsk are constrained by S&P's view of
its "developing and unbalanced" public finance system, relatively
low wealth levels, "negative" management quality, low budgetary
flexibility, "negative" liquidity, and moderate contingent risks
related to the poor financials of the city's government-related
entities.  These weaknesses are offset by the city's low debt and
moderate budgetary performance.

                               OUTLOOK

The stable outlook on Ivano-Frankivsk reflects that on Ukraine.

Because the rating on the city is capped at the sovereign rating,
any rating action on Ukraine would likely lead to a similar
action on Ivano-Frankivsk, all else being equal.  S&P currently
do not see a viable downside scenario for the city's ICL.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.  The chair
ensured every voting member was given the opportunity to
articulate his/her opinion.  The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook.

RATINGS LIST

Outlook/CreditWatch Action; Ratings Affirmed
                                To                 From
Ivano-Frankivsk (City of)
Issuer Credit Rating           B-/Stable/--       B-/Negative/--
Ukraine National Scale Rating  uaBBB-/--/--       uaBBB-/--/--


KYIV CITY: S&P Revises Outlook to Stable and Affirms 'B-' ICR
-------------------------------------------------------------
Standard & Poor's Ratings Services revised to stable from
negative its outlook on Ukraine's capital City of Kyiv.  At the
same time, S&P affirmed the 'B-' long-term issuer credit rating.

Rationale

The outlook revision follows a similar action on Ukraine on
Dec. 26, 2013.  S&P do not cap the rating on Kyiv at the long-
term rating on Ukraine.

The rating on Kyiv reflects S&P's view of Ukraine's institutional
framework as "volatile and underfunded."  Rating weaknesses are
the city's severely constrained financial flexibility; weak
budgetary performance; "negative" financial management; "very
negative" liquidity; material debt burden, with associated
foreign-exchange risks; and high contingent liabilities.

The rating is supported by the city's position as the
administrative and economic center of Ukraine, its fairly
diversified economy, and wealth levels exceeding the national
average severalfold.

For further analysis, see "Ukrainian Capital City of Kyiv 'B-'
Rating Affirmed; Outlook Negative," published Dec. 20, 2013.

                              OUTLOOK

The stable outlook reflects the fact that Kyiv's refinancing
risks are counterbalanced by support from the central government.

Positive rating actions would hinge on an upgrade of the
sovereign and the city's stronger budgetary performance,
including operating surpluses approaching 7%-8% in 2014-2015 or
improved borrowing and refinancing terms that would result in a
lower debt burden and a stronger liquidity position.  Ratings
upside could also stem from a continued reduction in the city's
government-related entities' payables, which would lead to lower
contingent risk.

A negative rating action on Kyiv would follow a negative action
on Ukraine.  S&P could also take a negative rating action on the
city even if the sovereign ratings remain unchanged if the
central government's support for Kyiv diminished, leading to a
weaker debt repayment capacity for the city.  This would likely
result in worse budgetary performance than S&P currently expects
in its base-case scenario, and take the form of restricted access
to state banks' and the treasury's liquidity.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.  The chair
ensured every voting member was given the opportunity to
articulate his/her opinion.  The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook.

RATINGS LIST

Outlook/CreditWatch Action; Ratings Affirmed
                                 To               From
Kyiv (City of)
Issuer Credit Rating            B-/Stable /--    B-/Negative/--
Senior Unsecured                B-               B-

Kyiv Finance PLC
Senior Unsecured                B-               B-


UKRAINE: S&P Revises Outlook to Stable & Affirms 'B-/B' Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Ukraine
to stable from negative.  At the same time, S&P affirmed its
'B-/B' foreign and local currency long- and short-term sovereign
credit ratings on Ukraine.

S&P also affirmed the long-term Ukraine national scale rating at
'uaBBB-'.

                             RATIONALE

The stable outlook reflects S&P's view that the US$15 billion
(about 8% of 2014 GDP) in direct financing, which Russia
announced on Dec. 18, 2013, that it would provide to the
Ukrainian government, should cover the government's external
financing needs over the next 12 months.  With rollovers of trade
financing and other private sector debt, S&P now expects
Ukraine's foreign currency reserves to stabilize, further
supported by an additional agreement to reduce by about 30% the
price at which Naftogaz imports gas from Gazprom.

S&P understands that Russia could revise this financial aid on a
quarterly basis.  Therefore, in S&P's view, it is subject to
constructive diplomatic relations between the two countries being
maintained.  Under S&P's base case, it expects Russia will
provide the support as it has currently outlined.  In S&P's view,
Ukraine's financial dependence on Russia will increase if market
conditions do not afford the government the opportunity to issue
debt to international capital market participants other than
Russia, or if other sources of financing are not found.

The ratings are constrained by S&P's view of political
turbulence, economic decline, financial sector stress, and weak
external liquidity.  The ratings are supported by Ukraine's still
relatively low, albeit rising, government debt burden and fairly
diversified economy.

A sharp policy U-turn by President Yanukovych on Nov. 23, 2013,
led to Ukraine's suspending the signing of an EU Association
Agreement and a Deep and Comprehensive Free Trade Area with the
EU. Mr. Yanukovych's decision appears to have gained Ukraine the
aforementioned Russian financial support package; however, it is
unclear what concessions Russia will require in return.

The initial decision to turn away from further integration with
Europe led to thousands of protesters' taking to the streets in
Kyiv and other major Ukrainian cities and calling for
Mr. Yanukovych to step down from power.  The protests are
ongoing. If they were to escalate and S&P was to assess Ukraine
as exhibiting characteristics of a distressed civil society or
political institutions were to weaken, diminishing the
government's capacity to maintain timely debt service, this would
weigh on the ratings.

Based on S&P's expectations of Russia's support, it no longer
expects a devaluation of the Ukrainian hryvnia.  S&P now uses the
baseline assumption that it will stabilize against the U.S.
dollar at the rate of UAH8.2:US$1 from end-2013.  As a result,
S&P now projects weaker economic growth, lower inflation, and
larger current account deficits -- even accounting for the
expected reduction in the gas import bill -- through to 2016.

S&P projects foreign currency reserves held at the National Bank
of Ukraine (NBU; the central bank) to average just above two
months of current account payments and below 30% of external
short-term debt (by remaining maturity) over the 2014-2016
forecast period.  This is largely unchanged from S&P's November
forecast with the larger current account deficits partly funded
by the funds from Russia, mitigating the negative impact on
foreign currency reserves.

Under S&P's base case, it do not expect Ukraine to commit to
significant broad-based reforms.  S&P expects little progress in
areas, such as fiscal consolidation, creating a more-market-
oriented domestic gas market, resolving nonperforming loans in
the financial sector, or increasing exchange-rate flexibility.

S&P's estimate of the average change in general government debt
over 2013-2016 is about 6% of GDP.  S&P expects the general
government net debt burden to average about 38% of GDP over the
same period.  S&P expects the Russian loans to meet existing
foreign currency government debt service in 2014-2015, rather
than significantly increasing government debt, with the Russian
funds substituting for funds from the IMF and commercial
creditors. About 52% of gross government debt is currently
denominated in foreign currency, although mostly on concessional
terms.

S&P expects local currency financing of the general government
deficit to continue to come largely from the NBU and state-
controlled banks.  The NBU holds 58% of local currency debt as of
December 2013, while banks hold 32%, which is about 11% of
commercial bank assets.

S&P views the weakness of the banking system as an impediment to
monetary policy flexibility.  The banks refinanced at the NBU at
an average weighted rate (on all instruments) of 6.8% in November
2013 compared with average weighted interest earnings on loans to
households and business of about 16% in local currency and 9% in
foreign currency.  Problem loans, including nonperforming and
restructured loans in the banking system, are around a very high
40% of total loans and could rise further if a sharp devaluation
occurs, as 35% of bank loans were denominated in foreign currency
as of October 2013.

Ukraine's GDP per capita is estimated at $4,400 in 2014.  S&P
projects the population will continue to decline by about 0.5%
per year.  Due to weak external demand for Ukraine's metals and
machinery exports and continued declines in industrial
production, S&P now expects trend growth as defined by our
criteria at 1.6%.

                               OUTLOOK

The stable outlook balances the turbulent political situation
against S&P's expectation that the Russian government will
provide financing to Ukraine to meet its external debt service
needs over the coming 12-18 months.

S&P could lower its ratings on Ukraine over the next 12 months if
the sufficiency and timeliness of Russian financial support were
to be become less certain or the political turmoil in Ukraine
were to escalate to a significant degree.

Alternatively, S&P could raise the ratings if Ukraine were to
embark on a reform program likely to lower external and fiscal
deficits, including bringing the government's interest costs
below 5% of revenues or reducing external financing needs
materially.

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision.

After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.  The chair
ensured every voting member was given the opportunity to
articulate his/her opinion.  The chair or designee reviewed the
draft report to ensure consistency with the Committee decision.
The views and the decision of the rating committee are summarized
in the above rationale and outlook.

RATINGS LIST

CreditWatch/Outlook Action; Ratings Affirmed
                                       To           From
Ukraine
Sovereign Credit Rating               B-/Stable/B  B-/Negative/B
Senior Unsecured                      B-           B-
Transfer & Convertibility Assessment  B-           B-
Ukraine National Scale                uaBBB-/--/-- uaBBB-/--/--



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


CO-OPERATIVE BANK: Moody's Withdraws Ca Subordinated Debt Rating
----------------------------------------------------------------
Moody's Investors Service has withdrawn the Co-Operative Bank
Plc's (Co-op) subordinated debt and junior subordinated debt
ratings at Ca and Ca (hyb) respectively; the 13% perpetual
subordinated bond has been upgraded to Caa3 before being
withdrawn. Other ratings unaffected.

Ratings Rationale

Co-op's subordinated and junior subordinated debt ratings have
been withdrawn following the successful completion of the
liability management exercise (LME), announced on December 18,
2013. All the subordinated instruments have been withdrawn at the
current level of Ca and Ca (hyb) except the 13% perpetual
subordinated bonds rating which has been upgraded to Caa3 (hyb)
and then withdrawn, prompted by the higher recovery granted by
notes issued by the Co-operative Group (not rated) received in
exchange.

While the successful completion of the LME is a significant
milestone for Co-op's restructuring, the bank still faces
significant challenges in restoring its franchise -- winding-down
its significant non-core portfolio and increasing the very low
efficiency and profitability of its core operations via a multi-
year cost reduction and restructuring plan. The plan outlines a
restructuring to last four to five years, which envisages that
the Bank will cure its breach of the regulatory Individual
Capital Guidance (ICG) by the end of the plan period, giving it
little flexibility for any further unexpected losses. While the
plan has been discussed and agreed with the Prudential Regulation
Authority (PRA), the PRA does retain discretion to revisit the
Bank's non-compliance with its ICG. The standalone ratings at
E/ca reflect the significant challenges ahead in executing this
plan.


CO-OPERATIVE BANK: DBRS Downgrades Deposit Ratings to 'BB'
----------------------------------------------------------
DBRS Ratings Limited has downgraded the ratings of The Co-
operative Bank plc (The Co-operative Bank or the Bank), including
the Bank's Long-Term debt and deposit ratings to BB from BBB
(low), and the Short-Term debt and deposit ratings to R-4 from R-
2 (middle).  The Subordinated Bonds and the Perpetual
Subordinated Bonds of the bank have been downgraded to Selective
Default (SD) from CC, as DBRS views the liability management
exercise (LME) as a Distressed Exchange, and will then be
discontinued.  The Intrinsic Assessment is now BB.  The Trend on
the long-term ratings is Negative.

The downgrade of the Long-Term debt and deposit ratings to BB
reflects the magnitude of the required far-reaching restructuring
of the Bank, which is larger than previously anticipated, and the
still modest capital position of the Bank following the
successfully completed LME.  In addition, DBRS's view that the
Bank will remain susceptible to event risk while it undertakes
the restructuring was a factor in the positioning of the long-
term rating at BB.  The Negative Trend reflects the execution
risk inherent in the restructuring, as well as the potential
impact on the franchise of the events of the last few months and
the investigations into the activities and former management of
the Bank and The Co-operative Group (The Co-operative Group or
the Group).

DBRS views the recent completion of the LME as broadly positive
for senior bondholders and depositors, as it enables the Bank to
continue as a going concern and should provide it with time to
carry out the restructuring.  Following the LME, The Co-operative
Group's equity stake in the business will reduce to 30%, with the
remaining 70% being owned by the former holders of the Bank's
lower tier 2 debt.  The Bank is then to be listed in 2014.  To
reduce the impact of the increase in external ownership, the
Group has incorporated its ethical approach into the Bank's
Articles of Association.  DBRS expects that this will, to some
extent, help to protect the Bank's franchise from the potential
adverse impact of the widespread media coverage of recent
negative developments at the Bank and the change in the ownership
structure.  However DBRS views the announcement of several
investigations into the Bank negatively as they have the
potential to increase costs and take up management time, while
the Bank is undertaking its significant restructuring.

The Bank's large Non-Core division (Co-operative Asset Management
or CoAm) comprises 44% of the Bank's gross customer balances, but
as a result of the higher risk profile of the assets, accounts
for 62% of credit risk-weighted assets (based on Basel III final
rules), as of end-June 2013.  The over-arching aim of CoAm is to
deleverage the balance sheet in a way that does not materially
reduce the common equity tier 1 ratio of the Bank, especially as
the restructuring of the Core business will mean that
profitability is constrained, but in DBRS's view this will be a
substantial challenge.  This reflects the significant downside
risk in some of the loan portfolios within CoAm, such as the
commercial real estate portfolio and the Optimum residential
mortgage portfolio.

The turnaround of the Core business, which is now focused on
retail and small business customers, will, in DBRS's view, also
be difficult, especially as a result of the widespread media
coverage of the issues at the Bank and the change in the
ownership structure.  Through a process of cost reductions
(including the already announced 15% reduction in the branch
network), a re-engineering of the IT platform, and re-pricing of
products to market levels, the Bank aims for the Core business to
have a low double digit return on equity over the 5 year planning
horizon.  A key challenge for the Bank will be to reduce its cost
base, while maintaining its hitherto high levels of service that
have differentiated it from many other banks in the UK market.

The current rating reflects DBRS's concerns regarding the
magnitude of the required restructuring of the Bank and the
execution risk that the Bank faces as it reduces the cost base
and re-engineers the IT infrastructure.  The successful
completion of the LME is expected to lead to the common equity
tier 1 (CET1) ratio increasing to the upper end of a 7% - 9%
range at end-2013.  However the Bank expects the CET1 ratio to
improve only modestly from this level in the coming years, as
despite the further GBP 333 million to be injected by the Group
in 2014, the likelihood of further provisioning charges and the
restructuring costs mean that the Bank is unlikely to be
profitable for some years.  In DBRS's view this evidences the
relative lack of capital flexibility that the Bank has and
highlights the challenge that the Bank faces to successfully
restructure its operations while maintaining a capital buffer.
Additionally DBRS notes that the Bank is not currently compliant
with its Individual Capital Guidance (ICG) -- the PRA's statement
as to the regulatory capital it expects the Bank to hold. The
Bank does however expect to be compliant with its ICG at the end
of the plan period.

Given the recent downgrade and the issues that the Bank continues
to face, upward ratings migration is highly unlikely in the short
to medium term.  Downward pressure on the ratings would be likely
if the core franchise of the Bank shows evidence of being further
impaired, if further significant provisions are required, or if
the Bank's deleveraging of the CoAm business has a negative
impact on capital ratios.

The downgrade to SD of the Subordinated Bonds and the Perpetual
Subordinated Bonds reflects DBRS' view that the LME is a
Distressed Exchange.  The terms of the exchange are
disadvantageous to bondholders and the bondholders were compelled
to consent to an exchange because failure to do so would
potentially have led to the Bank being unable to continue to make
legally scheduled payments as agreed.  As the instruments will
now cease to exist, following the completion of the LME, the SD
rating will then be discontinued.


HJ HEINZ: Moody's Corrects Rating on GBP125MM Notes to 'B1'
-----------------------------------------------------------
Moody's Investors Service has corrected the rating for the GBP125
million 6.25% Guaranteed Notes due 2030 (ISIN: XS0107681016)
issued by H.J. Heinz Finance UK Plc to B1 (LGD 5/77%) from B2
(LGD 6/94%). The rating for these notes was incorrectly
downgraded to B2 and assigned the wrong Loss Given Default of LGD
6/94% on June 19, 2013 due to an internal administrative error.


PUNCH TAVERNS: Moody's Lowers Ratings on 3 Note Classes to Ca(sf)
-----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of six
classes of notes issued by Punch Taverns Finance plc (Punch A)
and three classes of notes issued by Punch Taverns Finance B
Limited (Punch B).

Moody's rating action is as follows:

Issuer: Punch Taverns Finance plc

GBP200M M1 Notes, Downgraded to Caa1 (sf) and Remains On Review
for Possible Downgrade; previously on Feb 25, 2013 B1 (sf) Placed
Under Review for Possible Downgrade

GBP400M M2(N) Notes, Downgraded to Caa2 (sf) and Remains On
Review for Possible Downgrade; previously on Feb 25, 2013 B1 (sf)
Placed Under Review for Possible Downgrade

GBP140M B1 Notes, Downgraded to Ca (sf); previously on Feb 25,
2013 Caa1 (sf) Placed Under Review for Possible Downgrade

GBP150M B2 Notes, Downgraded to Ca (sf); previously on Feb 25,
2013 Caa1 (sf) Placed Under Review for Possible Downgrade

GBP175M B3 Notes, Downgraded to Ca (sf); previously on Feb 25,
2013 Caa1 (sf) Placed Under Review for Possible Downgrade

GBP215M C(R) Notes, Downgraded to C (sf); previously on Feb 25,
2013 Caa3 (sf) Placed Under Review for Possible Downgrade

Issuer: Punch Taverns Finance B Limited

GBP77.5M B1 Notes, Downgraded to Caa2 (sf) and Remains On Review
for Possible Downgrade; previously on Feb 25, 2013 B3 (sf) Placed
Under Review for Possible Downgrade

GBP125M B2 Notes, Downgraded to Caa2 (sf) and Remains On Review
for Possible Downgrade; previously on Feb 25, 2013 B3 (sf) Placed
Under Review for Possible Downgrade

GBP125M C Notes, Downgraded to C (sf); previously on Feb 25, 2013
Caa3 (sf) Placed Under Review for Possible Downgrade

The A3(sf) ratings of the liquidity facilities in both
transactions are unaffected by the action.

Moody's does not rate the Class D1 Notes issued by Punch A.
Moody's had previously on February 25, 2013 placed all classes of
Notes of the respective issuer on review for possible downgrade.

The action concludes the review of the following classes of
Notes: B1 Notes, B2 Notes, B3 Notes, C(R) Notes of Punch A and C
Notes of Punch B.

The following classes of notes remain on review for possible
downgrade:

Issuer: Punch Taverns Finance plc

GBP270M A1(R) Notes, Current Rating Remains Baa3 (sf) Under
Review for Possible Downgrade; previously on Feb 25, 2013 Baa3
(sf) Placed Under Review for Possible Downgrade

GBP300M A2(R) Notes, Current Rating Remains Baa3 (sf) Under
Review for Possible Downgrade; previously on Feb 25, 2013 Baa3
(sf) Placed Under Review for Possible Downgrade

GBP200M M1 Notes, Downgraded to Caa1 (sf) and Remains On Review
for Possible Downgrade; previously on Feb 25, 2013 B1 (sf) Placed
Under Review for Possible Downgrade

GBP400M M2(N) Notes, Downgraded to Caa2 (sf) and Remains On
Review for Possible Downgrade; previously on Feb 25, 2013 B1 (sf)
Placed Under Review for Possible Downgrade

Issuer: Punch Taverns Finance B Limited

GBP201M A3 Notes, Current Rating Remains Ba2 (sf) Under Review
for Possible Downgrade; previously on Feb 25, 2013 Ba2 (sf)
Placed Under Review for Possible Downgrade

GBP220M A6 Notes, Current Rating Remains Ba2 (sf) Under Review
for Possible Downgrade; previously on Feb 25, 2013 Ba2 (sf)
Placed Under Review for Possible Downgrade

GBP250M A7 Notes, Current Rating Remains Ba2 (sf) Under Review
for Possible Downgrade; previously on Feb 25, 2013 Ba2 (sf)
Placed Under Review for Possible Downgrade

GBP250M A8 Notes, Current Rating Remains Ba2 (sf) Under Review
for Possible Downgrade; previously on Feb 25, 2013 Ba2 (sf)
Placed Under Review for Possible Downgrade

GBP77.5M B1 Notes, Downgraded to Caa2 (sf) and Remains On Review
for Possible Downgrade; previously on Feb 25, 2013 B3 (sf) Placed
Under Review for Possible Downgrade

GBP125M B2 Notes, Downgraded to Caa2 (sf) and Remains On Review
for Possible Downgrade; previously on Feb 25, 2013 B3 (sf) Placed
Under Review for Possible Downgrade

The ratings of the Class A2(R) Notes, Class M2(N) Notes and Class
B3 Notes of Punch A are based on the underlying rating of the
Notes and are no longer based on the financial guarantee policy
provided by AMBAC Assurance UK Limited (rating withdrawn). The
ratings of the Class A7 and Class A8 Notes of Punch B are based
on the underlying rating of the Notes and are no longer based on
the financial guarantee insurance policy issued by MBIA UK
Insurance Limited (B1).

RATINGS RATIONALE

The downgrade action has been prompted by the progress update of
the parent company (Punch Taverns plc) on December 9, 2013 as
regards the restructuring of the two securitizations. Among other
revisions, the modified restructuring proposal entails debt
write-offs in exchange for combinations of cash payments and the
issuance of new subordinated notes in respect of the Class M1,
Class M2(N), Class B1, Class B2, Class B3 and Class C(R) Notes of
Punch A, and the Class B1, Class B2 and Class C Notes of Punch B.

The lower ratings reflect the likely loss that will be realised
by the noteholders. The proposed exchange for the affected notes
range between 95% of par amount of notes (Class M1 of Punch A),
in return for cash payment and new notes issuance, to 20% of par
amount of notes (Class C(R) of Punch A), in return for cash
payment only. For a full list of the exchange proposals, please
refer to the company announcement made on 9 December 2013.

Ongoing Review of the Notes for Possible Downgrade:

Given (a) the uncertainty around the execution and final terms of
the restructuring, (b) the risk of a substantial performance
deterioration of the underlying pub portfolios on the back of a
possible borrower default (absent a restructuring in Q1 2014),
and (c) the limited information available on the new notes being
offered to the mezzanine/junior noteholders, Moody's has
maintained the review of the notes for possible downgrade. At
this time, Moody's has not made a determination of the credit
quality of the new notes that are being proposed to be issued in
both transactions.

All classes of notes (rated above Ca) remain on review for
possible downgrade. The ratings of the notes will be based on and
are therefore sensitive to the outcome of the restructuring which
Moody's understands will be launched in mid-January 2014.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was Moody's
Approach to UK Whole Business Securitisations published in
October 2000.

Loss and Cash Flow Analysis and Stress Scenarios

In this approach, a sustainable annual free cash flow is derived
over the medium to long term horizon of the transaction, and then
multipliers are applied to such cash flows in order to reach the
debt which could be issued at the targeted long-term rating level
for the Notes. In addition, we look at various haircuts on the
pub values and consider different levels of potential swap
breakage costs. As such, Moody's analysis encompasses cash flow
analysis and stress scenarios.

The updated assessment is a result of Moody's on-going
surveillance of commercial mortgage backed securities (CMBS)
transactions. Moody's prior assessment is summarized in a press
release dated 25 February 2013 when Moody's announced that the
initial restructuring proposal of the parent company would
constitute a distressed exchange for the Classes M1, M2(N), B1,
B2, B3 and C(R) Notes of Punch A and for the Class B1, B2 and C1
Notes of Punch B. The last Performance Overviews for the affected
transactions were published on 19 November 2013.

Factors that would lead to an upgrade or downgrade of the rating

Main factors or circumstances that could lead to a change of the
current ratings are primarily a change in (a) the restructuring
terms proposed by the parent company along with the final outcome
as per noteholder votes and (b) a change to the performance of
the underlying pub portfolios outside of Moody's latest
expectations, including the cash flow generation and the
valuation of the underlying pub estate.



===================
U Z B E K I S T A N
===================


AMIRBANK: S&P Revises Outlook to Stable & Affirms 'CCC' Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services said it had revised its
outlook on Uzbekistan-based Amirbank to stable from positive.  At
the same time, S&P affirmed the 'CCC' long-term and 'C' short-
term counterparty credit ratings.

The outlook revision reflects S&P's anticipation that Amirbank is
unlikely to expand its franchise at the levels S&P previously
anticipated.  This is attributable to the bank's failure to
obtain a foreign currency license in 2013 and to register its
Qarshi-based branch, contrary to its plans.

Growth during the first nine months of 2013 was sluggish at 4.8%,
based on financials prepared in accordance with Uzbek generally
accepted accounting principles.  This was significantly lower
than the bank's planned growth of over 30%.  This lag in growth
largely stemmed from the bank's prolonged inability to obtain
regulatory capital of EUR5 million and its consequent failure to
obtain a foreign currency license and open a branch in the Qarshi
region.

In S&P's view, the bank's underperformance relative to its
planned strategy is likely to continue in the near term.  Despite
plans to accumulate additional capital through the partial sale
of subsidiary leasing companies, which would allow the bank to
reach the regulatory threshold of EUR5 million, S&P believes that
the Central Bank of Uzbekistan's willingness to issue a license
is low, and the possibility of an issuance is remote.  S&P also
notes that capital injections, although necessary for Amirbank to
comply with a presidential decree, have been difficult to
complete in the past.  S&P assumes that failure to obtain a
foreign currency license, which is very important for Uzbek
banks, alongside the increased presence of other private banks in
the Samarqand region, may undermine the bank's franchise.  S&P
therefore believes that the bank's capacity to improve its
business and financial profile is more remote than S&P previously
expected.

The ratings on Amirbank reflect the bank's "weak" business
position, "very strong" capital and earnings, "weak" risk
position, "below-average" funding, and "adequate" liquidity, as
S&P's criteria define these terms.  The stand-alone credit
profile is 'ccc'.

The stable outlook reflects S&P's forecast of a slowdown in
Amirbank's business development.  S&P also expects the bank will
maintain its strong capitalization and adequate liquidity over
the next 12-24 months.

S&P could consider raising the ratings if the bank succeeds in
obtaining a foreign currency license and improves its business
diversity and the quality of its revenues base, while continuing
to gradually improve its risk management and operational capacity
and maintaining capitalization at strong levels.

S&P may revise outlook to negative if it sees continued
underperformance relative to the bank's planned strategy.  S&P
may also consider a negative rating action if the current
liquidity cushion declines significantly so that it hurts the
bank's solvency, or if the projected risk-adjusted capital ratio
fell below 10%, which S&P would no longer view as strong.


                            *********

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,
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is compiled on the Friday prior to publication.  Prices reported
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public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
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historical cost net of depreciation may understate the true value
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prices at which equity securities trade in public market are
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Each Friday's edition of the TCR includes a review about a book
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                            *********


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

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