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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

         Wednesday, November 16, 2016, Vol. 17, No. 227


                            Headlines


G E O R G I A

GEORGIA: S&P Affirms 'BB-/B' Sovereign Credit Ratings


G E R M A N Y

INEOS STYROLUTION: S&P Affirms then Withdraws 'B+' CCR Rating
LANXESS AG: S&P Assigns 'BB' Rating to Proposed 60-Yr. Notes
RWE AG: S&P Affirms 'BB' Issue Rating on Jr. Subordinated Debt


I T A L Y

ASTALDI SPA: S&P Affirms 'B' Corp. Credit Rating, Outlook Neg.
BANCA CARIGE: Fitch Places 'BB+' Rating on Watch Positive


K A Z A K H S T A N

KASSA NOVA: S&P Affirms 'B/C' Counterparty Credit Ratings


L U X E M B O U R G

SES SA: S&P Assigns 'BB+' Rating to Proposed Hybrid Securities


M O N T E N E G R O

MONTENEGRO: S&P Affirms 'B+/B' Sovereign Credit Ratings


N E T H E R L A N D S

MULTICYCLE INVENTURES: Declared Bankrupt by Zutphen Court


N O R W A Y

HAVILA SHIPPING: Bankruptcy Likely if Creditors Reject Debt Plan
LOCK LOWER: S&P Puts 'B+' Ratings on CreditWatch Positive


R U S S I A

BALTIC FINANCIAL: S&P Affirms 'B-/C' Counterparty Credit Ratings
LSR GROUP: Fitch Affirms 'B' Long-Term Foreign Currency IDR
PERESVET BANK: Central Bank Discusses Financial Recovery
RN BANK: Fitch Affirms 'BB+' LT Issuer Default Rating


S E R B I A

JUGOREMEDIJA: Declared Bankrupt, Court Orders Asset Sale


S L O V A K   R E P U B L I C

SLOVAKIA: Trnava Region Proposes Liquidation of Piestany Airport


S P A I N

ABENGOA SA: Posts Nine-Month Loss of EUR5.4 Billion


U N I T E D   K I N G D O M

BASE STRUCTURES: Files for Liquidation
ENQUEST PLC: Creditors Back Restructuring Plans, Hearing Today
RELATE SHROPSHIRE: In Liquidation, Staff Owed Hundreds of Pounds


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G E O R G I A
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GEORGIA: S&P Affirms 'BB-/B' Sovereign Credit Ratings
-----------------------------------------------------
S&P Global Ratings affirmed its 'BB-/B' long- and short-term
foreign and local currency sovereign credit ratings on the
Government of Georgia.  The outlook is stable.

                            RATIONALE

In S&P's view, Georgia's creditworthiness is supported by the
country's reasonably resilient economic growth and the
government's relatively prudent fiscal position, with net general
government debt below 40% of GDP.  The ratings are primarily
constrained by income levels -- which remain low in a global
comparison -- and considerable balance of payments
vulnerabilities, including significant import dependence, high
current account deficits, and sizable external debt.
S&P also believes that the ratings remain constrained by the
limited monetary policy flexibility, given Georgia's shallow
domestic capital markets and high levels of dollarization.

In October 2016, Georgia held parliamentary elections.  The
incumbent Georgian Dream-Democratic Georgia (GDDG) party
performed strongly, securing a constitutional majority (115 seats
out of a total of 150 parliamentary seats) in the two rounds of
the vote. S&P do not expect major changes in policy direction to
follow in the election aftermath. S&P anticipates that the
government will continue its efforts to focus more closely on
integration with the EU, strengthening the business climate, and
diversifying the economy -- which includes attracting
foreign direct investments in the priority sectors.
Historically, the Georgian authorities have largely maintained
reform focus and prudent public finances despite considerable
challenges at times, including a brief war with Russia in 2008
and the transition of power in 2012.

However, there are some risks that the institutional checks and
balances could weaken if GDDG exploits the parliamentary majority
for the party's advantage.  Nevertheless, this is not S&P's
baseline scenario: Georgia's institutional settings are among the
strongest in the region and we expect this to remain the case.
At the same time, S&P believes that several regional geopolitical
risks remain. Specifically, there are downside risks in Georgia's
relations with Russia given the former's broadly pro-western
focus and the disputed status of the South Ossetia and Abkhazia
regions. That said, S&P do not anticipate a material
deterioration in relations between the two countries.

Georgia's economic growth has so far remained rather resilient
considering the weak performance of several regional trade
partners. Preliminary official estimates suggest that real GDP
grew by 2.6% in year-on-year terms over the nine months of 2016,
which is broadly in line with our expectations.  S&P expects
headline growth of 2.8% this year followed by a gradual
improvement toward a 5% growth rate in 2019. The following
factors underline this forecast:

   -- Robust investment dynamics over the next two years,
      underpinned by a number of public and private projects,
      including in the energy and tourism sectors;

   -- Relatively strong consumption performance supported by
      moderate inflation levels, more stable lari exchange rate,
      and recuperating domestic credit growth;

   -- Strengthening export performance from 2017 as the
      government's efforts to diversify Georgia's exports bring
      some results, while the economies of regional trade
      partners -- including Russia and Azerbaijan -- return to
      growth.

S&P continues to see considerable downside risks to its growth
projections, particularly if Georgia's key trading partner
performance is lower than S&P currently expects.  Since a number
of the country's main trading partners are heavily reliant on oil
exports, such a scenario could materialize if oil prices started
to fall again, as they did at the beginning of 2016.  S&P also
sees longer-term structural challenges for the Georgian economy.
At present, the country remains highly reliant on imports, while
its export basket is characterized by predominantly low value-
added goods.

S&P understands that there is substantial potential in developing
the country's hydroelectricity-generation, agricultural
production, and tourism sectors.  Although the government
continues to target the development of these sectors, S&P
believes this is a long process and that most benefits will
likely materialize beyond S&P's forecast horizon.

The ratings on Georgia are still supported by the sovereign's
relatively strong fiscal policy settings.  The general government
deficits have averaged close to 2% of GDP over the last five
years, which compares favorably to many other sovereigns S&P
rates in the 'BB' category.  S&P presently forecasts broadly
similar deficit levels over the next four years.  Specifically,
S&P anticipates that the general government deficit will widen
slightly in 2016 due to somewhat higher-than-budgeted
expenditures, but that it will gradually tighten thereafter.
That said, there could be downside risks, particularly if
real or nominal growth turns out to be weaker than expected.  S&P
also sees risks to government revenue performance from the
introduction of the so-called Estonian model, whereby only
distributed corporate dividends will be taxed rather than overall
profits.  The arrangement is due to be introduced from 2017.

"We anticipate that change in general government debt in 2017-
2019 will be somewhat higher than the headline deficits imply,
amounting to about 3.5% of GDP.  This is mainly due to the
projected moderate lari depreciation inflating debt, nearly 80%
of which is in foreign currency.  Nevertheless, the debt-to-GDP
trajectory remains favorable, and we expect debt to start
declining as a share of the economy, following a peak of 43% in
2018.  According to our present projections, gross general
government debt would have increased by only about 5% of GDP over
2010-2019.  We also view the government's contingent liabilities
stemming from the public enterprises and the domestic banking
system as limited," S&P said.

Georgia's weak external position remains one of the primary
constraints on the ratings.  The country's external current
account deficit has remained persistently wide and reached a
four-year high in 2015 of 12% of GDP.  This has taken place as
exports contracted while remittances declined, particularly from
recession-affected Russia, where many Georgians live and work.

S&P believes, however, that the headline current account deficits
somewhat overestimate Georgia's external vulnerabilities given
that they have been predominantly financed by foreign direct
investment (FDI) inflows in recent years.  During 2013-2015, net
FDI financed four-fifths of Georgia's current account deficit.
The FDI has been particularly concentrated in the energy sector,
reflecting several projects, including the expansion of the South
Caucasus Pipeline (SCP) intended to bring gas from Azerbaijan to
Turkey via Georgia.  This project alone accounted for an
estimated 40% of total FDI inflows in 2015.  There are also
several hotels being constructed in central Tbilisi. Most of
these FDI-related projects are heavily import-intensive,
contributing to Georgia's wide trade deficits.

"Although we generally consider that FDI financing presents
smaller risks compared to external debt, there are still
significant vulnerabilities.  Specifically, while a hypothetical
sizable reduction in FDI inflows may not necessarily lead to a
disorderly adjustment involving an abrupt depreciation of the
lari (due to a simultaneous corresponding sizable contraction in
FDI-related imports), it will likely have implications for
Georgia's growth and employment.  The accumulated stock of inward
FDI also remains substantial at about 150% of the country's
generated current account receipts, exposing the sovereign to
risks should foreign investors decide to leave, for example, due
to changes in business environment or a deterioration in economic
outlook," S&P said.

In S&P's view, the ratings on Georgia also remain constrained by
the limited flexibility of the National Bank of Georgia's (NBG)
monetary policy.  In particular, S&P believes the shallow
domestic capital markets, as well as relatively high resident
deposit and loan dollarization, hamper the NBG's ability to
influence domestic monetary conditions through local currency
liquidity.

At the same time, S&P believes that the more flexible exchange
rate arrangement maintained by the central bank has largely
facilitated Georgia's speedy adjustment to the evolving external
environment.  The NBG allowed the lari to depreciate by about 30%
against the U.S. dollar in 2015, with only occasional
interventions to smooth volatility.  As a result, the NBG's
foreign exchange reserves have been quite stable in the last few
years, unlike some other regional sovereigns which have attempted
to defend more rigid foreign exchange regimes.  NBG's reserves
have grown in recent months and we forecast they will total about
US$2.9 billion at end-2016, up from US$2.5 billion at end-2015.

                              OUTLOOK

The stable outlook reflects S&P's expectation that Georgia's
economy will continue to grow over the next 12 months and that
its fiscal and external performance will not deviate materially
from S&P's baseline forecasts.

S&P could raise the ratings if growth materially exceeds its
current forecasts or if S&P sees significant improvements in the
effectiveness of monetary policy that allows the authorities a
wider arsenal of tools to smoothen cyclical economic shocks over
the next 12 months.
S&P could also raise the ratings if Georgia's institutional
settings and policymaking effectiveness were to improve.

S&P could lower the ratings if Georgia's external performance was
to deteriorate over the next 12 months, in contrast to S&P's
current forecasts.  S&P could also lower the ratings were fiscal
performance to weaken 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 committee agreed that all key rating factors were unchanged.

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.  The weighting of
all rating factors is described in the methodology used in this
rating action.

RATINGS LIST

                                        Rating
                                        To            From
Georgia (Government of)
Sovereign Credit Rating
  Foreign and Local Currency          BB-/Stable/B    BB-
/Stable/B
Transfer & Convertibility Assessment   BB+           BB+
Senior Unsecured
  Foreign Currency                      BB-           BB-
Commercial Paper
  Local Currency                        B             B


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G E R M A N Y
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INEOS STYROLUTION: S&P Affirms then Withdraws 'B+' CCR Rating
-------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' long-term corporate credit
rating on INEOS Styrolution Group GmbH and then withdrew it at
the issuer's request.  The outlook at the time of withdrawal was
stable.

S&P also withdrew its 'BB-' issue rating on Styrolution's
outstanding first lien term loan of EUR1.1 billion, due Nov.
2019, which was repaid.

At the same time, S&P affirmed its 'BB-' issue rating on
Styrolution's first lien term loan of EUR1.1 billion, due 2021,
which is guaranteed by Ineos Styrolution Holding Ltd.
(B+/Stable/--).  The recovery rating is unchanged at '2'.


LANXESS AG: S&P Assigns 'BB' Rating to Proposed 60-Yr. Notes
------------------------------------------------------------
S&P Global Ratings assigned its 'BB' long-term issue rating to
the proposed 60-year subordinated resettable fixed-rate notes to
be issued by Germany-based chemical company LANXESS AG
(BBB-/Negative/A-3).  The rating is subject to S&P's satisfactory
review of final documentation.  The transaction remains subject
to market conditions.

LANXESS plans to use the issuance to help fund its acquisition of
U.S.-based specialty chemicals company Chemtura Corp. for
EUR2.4 billion while preserving its balance sheet.  S&P will
classify the proposed securities as having intermediate equity
content once the acquisition has closed until their first call
date, because of their subordination, permanence, and optional
deferability during this period.

Consequently, in S&P's calculation of LANXESS' credit ratios
after closing of the acquisition, S&P will treat 50% of the
principal outstanding and accrued interest under the hybrids as
equity rather than as debt.  S&P will also treat 50% of the
related payments on these securities as equivalent to a common
dividend. Both treatments are in line with S&P's hybrid capital
criteria. Until the acquisition closes, S&P will classify the
hybrid securities as having minimal equity content, and will
treat them as 100% debt, due to the repurchase provisions that
will apply if the Chemtura acquisition does not proceed.  S&P
will, however, also likely treat the cash hybrid issuance
proceeds as surplus cash in our debt metric calculations.

The completion and size of the issue will be subject to market
conditions, but S&P anticipates that any transaction will be of
benchmark size.  These hybrids will help mitigate the
deterioration in our adjusted debt metrics, following the
acquisition of Chemtura Corp.

According to S&P's criteria, the two-notch difference between its
'BB' rating on the proposed hybrid notes and S&P's 'BBB-'
corporate credit rating on LANXESS reflects:

   -- One notch for the proposed notes' subordination because the
      corporate credit rating on LANXESS is investment grade
      (defined as 'BBB-' or above); and

   -- An additional notch for the optional deferability of
      interest.

The notching of the rating on the proposed securities takes into
account S&P's view that there is a relatively low likelihood that
LANXESS will defer interest payments.  Should S&P's view of the
likelihood of deferring interest payments change, it may
significantly increase the number of downward notches that it
applies to the issue rating on the proposed securities.

KEY FACTORS IN S&P'S ASSESSMENT OF THE PROPOSED INSTRUMENTS'
PERMANENCE

Although the proposed securities have a very long-term maturity
with an expected tenor of 60 years, LANXESS can redeem them as of
the first call date, which S&P understands will be no earlier
than 6.5 years after issuance, and on every interest payment date
thereafter.  If such an event occurs, S&P understands the company
intends to replace the instruments, although it is not obliged to
do so.

S&P believes that any repurchase, irrespective of the size, could
jeopardize the equity content of the securities and other hybrid
instruments, since it would lead S&P to question management's
intentions to maintain and replace such securities.

S&P understands that the interest to be paid on the proposed
securities will increase by 25 basis points (bps) five years
after the first call date, and by a further 75 bps 20 years after
the first call date.  S&P considers the cumulative 100 bps as a
material step-up, which provides an incentive for the issuer to
redeem the instrument on the first call date.

Consequently, S&P would no longer recognize the instrument as
having intermediate equity content after the first call date,
because the remaining period until their economic maturity would,
by then, be less than 20 years.  However, S&P classifies the
instrument's equity content as intermediate until its first call
date, as long as S&P believes that the loss of the beneficial
intermediate equity content treatment will not cause the issuer
to call the instrument at that point.  The issuer's willingness
to maintain or replace the instrument in the event that S&P
assess the equity content as minimal is underpinned by its
statement of intent.

KEY FACTORS IN S&P'S ASSESSMENT OF THE PROPOSED INSTRUMENTS'
SUBORDINATION

The proposed securities will be deeply subordinated obligations
of LANXESS, ranking junior to all unsubordinated or subordinated
obligations, and only senior to share capital.

KEY FACTORS IN S&P'S ASSESSMENT OF THE PROPOSED INSTRUMENTS'
DEFERABILITY

In S&P's view, LANXESS' option to defer payment of interest on
the proposed securities is discretionary.  This means that the
company may elect not to pay accrued interest on an interest
payment date because it has no obligation to do so.

However, any outstanding deferred interest payment would have to
be settled in cash if LANXESS paid an equity dividend or interest
on equal-ranking securities, or if the company repurchased common
shares or equal-ranking securities.  This condition remains
acceptable under S&P's rating methodology because, once the
issuer has settled the deferred amount, it can choose to defer
payment on the next interest payment date.

LANXESS retains the option to defer coupons throughout the life
of the proposed instrument.  The deferred interest on the
proposed securities is cash-cumulative and compounding.


RWE AG: S&P Affirms 'BB' Issue Rating on Jr. Subordinated Debt
--------------------------------------------------------------
S&P Global Ratings revised its outlook on German utility RWE AG
to stable from negative.  S&P affirmed its 'BBB-/A-3' long- and
short-term corporate credit ratings on the company.

S&P also affirmed its 'BBB-' issue rating on the senior unsecured
debt guaranteed by RWE and S&P's 'BB' issue rating on RWE's
junior subordinated debt.

The outlook revision reflects S&P's diminished concerns regarding
RWE's financial flexibility following the successful listing and
partial sale of its downstream business Innogy.  As a result of
the transaction, Innogy raised some EUR2 billion earmarked for
future investment and RWE received EUR2.6 billion in proceeds for
the sale of a 23.2% stake in the newly listed company.

At the same time, S&P understands the German government is
setting up the legal framework for the settlement of nuclear-
related waste obligations without material deviations from the
recommendations of the KFK commission.  This development
alleviates some of the uncertainty associated with the financial
obligations German nuclear power plant operators, including RWE,
will have to fulfill.  Furthermore, S&P expects RWE will sustain
cash outflow of about EUR6.8 billion, including the premium on
the provision, over the next 12 months.  S&P has positively
reassessed the group's liquidity accordingly, also taking into
account the proceeds for the Innogy transaction.

Furthermore, power prices in Germany recovered to around EUR30
per megawatt hour (/MWh) from EUR20/MWh reported in early 2016.
The rebound is primarily driven by the recovery of commodity
prices -- specifically that of coal, which almost doubled from
its low in the first quarter of 2016, and this supports forward
prices in Germany.

For 2017, S&P expects an even stronger recovery in power prices,
driven by unexpected outages in the French nuclear generation
fleet, which will also impact prices in neighboring countries.
If sustained, the increase in the power price will improve the
profitability of RWE's fixed-cost-based (outright) production
fleet (lignite and nuclear), which produced more than 100
terawatt hours in 2015.  Given the group's long-term hedging
strategy for these assets, the short-term increase in prices,
driven by lower supply from French nuclear, will have no material
impact and current price levels will become visible with a time
lag of about two years, also keeping in mind very low power price
levels in the first half of 2016.

For RWE's spread portfolio (coal and gas), the impact of higher
power prices on earnings is mixed. Dark spreads have decreased as
input prices (coal) have increased at a stronger rate than power
prices.  Gas inputs prices remain unchanged driving spark spreads
higher.  The spread portfolio might benefit from the lower-than-
expected energy supply from France increasing its utilization, in
particular its gas power plants in the U.K.

S&P maintains a consolidated approach on RWE, which includes 100%
of Innogy in the group's perimeter.  This reflects the lack of
visibility S&P has on the parent company's strategy with respect
to Innogy.  As such, S&P negatively reassessed its management and
governance assessment to satisfactory from strong previously.
S&P understands for now that the parent company is not
considering relinquishing control of Innogy, but that is plans to
run Innogy as a financial asset.  S&P believes that RWE had a
material influence on Innogy's market positioning and medium-term
strategy.

The stable outlook reflects S&P's diminished concerns regarding
the group's financial flexibility after the successful listing
and partial sale of Innogy and S&P's expectation that the group's
adjusted FFO to debt will be at least 16% on a consolidated
basis.

S&P could downgrade RWE if S&P observes the group struggling to
maintain consolidated credit metrics in line with above-mentioned
levels.  In S&P's view, base-case credit metrics are relatively
resilient in light of slightly recovered market conditions and a
lower likelihood of additional interest rate-linked increases in
pension liabilities.

Although S&P currently have no clarity on management's strategy
for the EUR3.8 billion hybrid bonds issued by RWE or its
commitment to an investment-grade rating, any potential review of
all of these instruments' equity credit instruments could drive
the group's adjusted FFO to debt below 16% and pressure the
rating, if not adequately mitigated.

In addition, over the longer term, a change in S&P's rating
approach on RWE, one that would exclude Innogy from the
consolidated perimeter of the group, could have a negative impact
on the rating, if the likely deterioration in RWE's business risk
profile was not offset by a material improvement to its financial
risk profile.

S&P sees an upgrade as highly unlikely, in view of the group's
strategy to have its strongest subsidiary, Innogy, run more
independently, and the need for materially stronger credit
metrics.


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I T A L Y
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ASTALDI SPA: S&P Affirms 'B' Corp. Credit Rating, Outlook Neg.
--------------------------------------------------------------
S&P Global Ratings affirmed its 'B' long-term corporate credit
rating on incorporated civil engineering and construction company
Astaldi SpA and removed the ratings from CreditWatch with
negative implications.  The outlook is negative.

At the same time, S&P affirmed its issue rating on Astaldi's
EUR750 million senior unsecured notes at 'B', in line with the
long-term corporate credit rating.  The recovery rating on this
debt remains unchanged at '4'.

The CreditWatch resolution follows S&P's review of Astaldi's
third-quarter 2016 financial results and liquidity position.
After a higher-than-expected outflow of working capital in the
first half of 2016, Astaldi's liquidity position started to
stabilize in the third quarter. It was supported by a cash
release from working capital of about EUR90 million, resulting
from the collection of receivables and reducing investment in
work-in-progress, in line with the company's normal seasonal
cycle.

Astaldi completed several large capital-intensive projects,
received advance cash payments under new contracts, and reduced
cash absorption by the Muskrat Falls project in Canada after it
signed a bridge agreement with the client.  In September 2016, it
also received a EUR110 million cash-in after it completed the
sale of its shares in A4, an Italian motorway concessions
operator.

Following these positive developments, S&P no longer expects
Astaldi to face a deficit of liquidity sources over uses in the
next six to 12 months.  Nevertheless, for the full-year 2016 S&P
still expects a net working capital outflow of about
EUR100 million (compared with the net working capital position as
of end of December 2015), and expect it to recover only in 2017.

Astaldi remains exposed to significant short-term debt
maturities, which make its liquidity coverage ratio borderline at
just below 1x.  In S&P's view, over the next 12 months, the
liquidity position will be vulnerable to potential delays in cash
collection or any unexpected cash outflows relating to current
projects, as well as to funding conditions.  As a result, the
outlook is negative, reflecting a one-in-three probability that
S&P could lower the rating if it observes any pressure on
liquidity over this period.

The rating continues to reflect Astaldi's moderately high
business risks, which S&P sees as inherent to the cyclical
engineering and construction industry, the company's moderate
size by global standards, and its exposure to country risks in
emerging markets. Moreover, the company is subject to operating
and contract risks and potential execution issues stemming from
large projects within its portfolio, as well as from the
relatively high proportion of fixed-price contracts in its
construction business.  These account for about half of total
contracts and reduce financial flexibility.  Nevertheless, S&P's
view of Astaldi's business risk profile is supported by its solid
market position in the transportation infrastructure industry and
proven ability to deliver large and technically complex projects.

In 2016, Astaldi completed several important projects in Turkey
and Italy on time and on budget and continued to grow its backlog
by winning new contracts, mainly in the transport infrastructure
sector in Italy, Chile, and Central and Eastern Europe.  In
September 2016, the backlog in execution reached about
EUR18 billion, which S&P considers makes revenue generation for
the next two to three years more predictable.  S&P expects EBITDA
margins will remain relatively sound and stable, gradually
recovering in 2016-2017 compared with 2015, which was negatively
affected by the delays and higher costs in the Muskrat Falls
project.

Astaldi's financial profile remains highly leveraged, but S&P
expects leverage metrics will gradually improve, because the
management remains committed to using free operating cash flow
(FOCF) and proceeds from asset sales to repay debt over the next
two-to-three years and to reducing leverage in line with the
company's medium-term business plan.  The company is shifting
focus toward construction projects, especially the ones that
assume higher advance payments, and reducing its involvement in
the capital-intensive concessions business.  Combined with
improving working capital discipline, this should support
stronger operating cash flows in the coming years, and S&P
forecasts that FOCF will turn positive in 2017.

Astaldi is working on disposing of several concession assets in
Chile, Italy, and Turkey in 2017-2020.  It estimates the total
value of these assets at about EUR600 million-EUR700 million, and
intends to use the proceeds of their sale to repay debt.  S&P
currently don't factor the full amount into its base-case
scenario, because the exact timing and values are uncertain, and
in S&P's view these sales might be subject to execution risks and
delays, especially given the currently elevated geopolitical
risks in Turkey.  At the same time, Astaldi has already received
offers on its shares in concessions for Line 5 of the Milan
underground and hospitals in Italy and Chile. In our base-case
scenario for 2017, S&P don't include the full amount of asset
sales planned by the company, but take a conservative assumption
and expect Astaldi could receive at least about EUR30 million-
EUR50 million.

S&P's base-case scenario assumes:

   -- Revenues to increase by about 4.5%-5.0% in 2016 and by
      5.0%-5.5% annually in 2017-2018, based on the existing
      backlog and new order intake;

   -- Adjusted EBITDA margin to gradually improve to about
      10.7%-11% in 2016-2018, compared with 10.2% in 2015;

   -- A nonseasonal outflow of working capital of about
      EUR115 million in 2016 due to investment into new projects,
      followed by a release of about EUR50 million in 2017, as
      the company implements its plans to improve working capital
      management;

   -- Capex and investments in concessions of about EUR110
      million-EUR160 million per year;

   -- Dividends of about EUR20 million-EUR25 million per year;
      and

   -- S&P's assumption of about EUR30 million-EUR50 million asset
      sales in 2017.

Based on these assumptions, S&P forecasts:

   -- Free operating cash flow to turn positive in 2017;
   -- Funds from operations (FFO) to debt reducing to about 6% in
      2016 from 8.5% in 2015, reflecting higher leverage and
      interest costs, but stabilizing at about 8% in 2017-2018;
      and
   -- Adjusted debt to EBITDA remaining at 5.6x in 2016, broadly
      in line with 2015, and improving to about 5x in 2017-2018.

The negative outlook reflects S&P's view that Astaldi is exposed
to refinancing risks stemming from the need to roll over short-
term uncommitted bank lines, and is vulnerable to cash outflows
relating to working capital, which could weaken its liquidity
position.

S&P could lower the rating over the next 12 months if Astaldi's
liquidity sources are not sufficient to cover uses.  For example,
this could happen if Astaldi faced delays in collecting advance
and other contract payments under its current projects,
particularly in Turkey.  Delays in disposing of concession assets
and persistently high leverage metrics could also lead to a
downgrade.

S&P could revise the outlook to stable over the next 12 months if
liquidity becomes adequate on a consistent basis, with sources
exceeding uses by at least 1.2x and adequate headroom under
financial covenants, and if we observe a longer track record of
improving net working capital position.  Rating upside is
currently limited, in S&P's view.


BANCA CARIGE: Fitch Places 'BB+' Rating on Watch Positive
---------------------------------------------------------
Fitch Ratings has taken rating actions on eight Italian mortgage
covered bond programmes (Obbligazioni Bancarie Garantite, OBG),
as follows:

   -- Banca Carige S.p.A. - Cassa di Risparmio di Genova e
      Imperia (Carige; B-/Stable/B) OBG's 'BB+' rating placed on
      Rating Watch Positive (RWP)

   -- Banca Monte dei Paschi di Siena SpA (BMPS; B-/RWE/B/RWN)
      OBG's 'BBB' rating maintained on Rating Watch Evolving
     (RWE)

   -- Banca Popolare di Sondrio-Societa Cooperativa per Azioni
      (BPS; BBB/Negative/F3) OBG's 'A+' rating placed on RWP

   -- Credito Emiliano S.p.A. (Credem, BBB+/Negative/F2) OBG's
      'A+' rating maintained on RWP

   -- Mediobanca Spa (Mediobanca; BBB+/Negative/F2) OBG's 'A+'
      rating maintained on RWP

   -- Unione di Banche Italiane S.p.A (UBI; BBB/Negative/F3)
      guaranteed by UBI Finance CB 2 S.r.l. (UBI II) OBG's 'BBB+'
      rating placed on RWP

   -- UniCredit S.p.A. (UC, BBB+/Negative/F2) guaranteed by
      UniCredit BpC S.r.l. (UC SB) OBG's 'AA' rating placed on
      RWP

   -- UC, guaranteed by UniCredit OBG S.r.l. (UC Conditional
      Pass-Through (CPT) OBG's affirmed at 'AA+'; Outlook revised
      to Negative from Stable

The rating actions follow the implementation of the agency's
revised Covered Bonds Rating Criteria published on October 26,
2016. They also incorporate the revision of the Outlook on
Italy's Issuer Default Rating (IDR; BBB+/Negative/F2) to Negative
from Stable, as well as the revision of the Outlook on Credem's
and Mediobanca's Long-Term IDRs to Negative from Stable.

IDR Uplift

All Italian covered bonds rated by Fitch are eligible for a
maximum IDR uplift of two notches given their exemption from
bail-in in a resolution scenario, Fitch's assessment that
resolution of the issuer will not result in the direct
enforcement of recourse against the cover pool and the low risk
of undercollateralisation at the point of resolution (see Fitch's
Jurisdictional Analysis of the Risk of Undercollateralisation of
Covered Bonds - Excel file).

Fitch has assigned an IDR uplift of two notches to all OBG
programmes. This reflects that the issuers' Long-Term IDRs are
driven by their Viability Ratings and takes into account Fitch's
assessment of the Italian legal framework, the presence of an
asset monitor, asset eligibility criteria and minimum contractual
levels of over-collateralisation (OC), as applicable.

Payment Continuity Uplift (PCU)

The programmes have strong liquidity profiles, with covered bonds
either issued with a soft bullet maturity extension of up to 15
months or with a conditional pass-through (CPT) amortisation
profile, which makes most of them eligible for the maximum
applicable PCU.

"We have assigned the programmes of BPS, Credem, Mediobanca and
UC SB a standard PCU of six notches. These OBG are soft bullet
with a 12-month principal maturity extension and provide for a
dynamic rolling reserve to cover for payment of interests on the
covered bonds (or under hedging agreements, where applicable) and
senior expenses due in the next three months," Fitch said.

"We have assigned UC CPT the standard PCU of eight notches for
CPT programmes." Fitch said. Fitch has assigned BMPS's OBG a PCU
of six notches due to weaknesses in the cover pool-specific
alternative management.

"We explain the non-standard PCUs for the remaining programmes in
Key Rating Drivers below," Fitch said.

Recovery Uplift

Most of the Italian programmes benefit from the maximum recovery
uplift of two notches, as the asset percentage (AP) that Fitch
takes into account compensates for credit losses modelled in a
stress scenario corresponding to the level of the covered bonds'
rating.

KEY RATING DRIVERS

Carige OBG

The RWP on the 'BB+' rating of Carige's OBG takes into account
the bank's Long-Term IDR of 'B-', a newly assigned IDR uplift of
two notches, a newly assigned PCU of four notches and a recovery
uplift of two notches. The programme could be upgraded as the
81.97% AP Fitch gives credit to in its analysis allows it to
withstand stresses above a 'BB+' rating scenario. The maximum
achievable rating is 'BBB+', subject to sufficient protection via
the AP.

Fitch gives credit to the 81.97% AP that the issuer publishes in
its investor report (September 2016). This level of AP provides
more protection than the revised 95% breakeven AP for the 'BB+'
rating, up from the previous 89.5%.

Carige OBG's PCU of four notches, instead of the standard six
notches, reflects the agency's assessment that the programme's
cover pool-specific alternative management represents a high risk
for payment continuity in the event that the source of covered
bonds payments switches to the cover pool. In Fitch's view, the
ease of the transferability of the relevant data and IT systems
to an alternative manager and buyer might be challenging, based
on the quality and quantity of the data available.

BMPS OBG

The RWE on the 'BBB' rating of BMPS OBG is driven by the RWE on
BMPS's Long-Term IDR of 'B-'. It also considers a newly assigned
IDR uplift of two notches, a newly assigned PCU of six notches, a
recovery uplift of two notches and the 83% AP the issuer commits
to apply in the asset coverage test and publishes in the investor
report. This level of AP provides more protection than the
revised breakeven AP for the current 'BBB' rating of 93.5%, up
from the previous 90%.

The six-notch PCU, rather than the standard eight notches for CPT
programmes, reflects Fitch's view that the cover pool-specific
alternative management for BMPS represents a high risk of payment
continuity due to weaknesses identified in the programme's
structure. This results in a strong reliance on the issuer's
ability to service payments due on the OBG and could pose risks
on a timely enforcement of the cover pool as a source of
payments.

BPS OBG

The RWP on the 'A+' rating of BPS's OBG takes into account the
bank's Long-Term IDR of 'BBB', a newly assigned IDR uplift of two
notches, a newly assigned PCU of six notches and a recovery
uplift of two notches. The programme could be upgraded as the
78.74% AP Fitch gives credit to in its analysis allows it to
withstand stresses above a 'A+' rating scenario. The maximum
achievable rating is 'AA+', subject to sufficient protection via
the AP.

Fitch gives credit to the 78.74% AP that the issuer publishes in
its investor report (September 2016), which provides more
protection than the revised 94% breakeven AP for the current
'A+', up from the previous 88.5%.

Credem OBG

The RWP on the 'A+' rating of Credem's OBG takes into account the
bank's Long-Term IDR of 'BBB+', a newly assigned IDR uplift of
two notches, a newly assigned PCU of six notches and a recovery
uplift of two notches. The programme could be upgraded as the AP
Fitch gives credit to in its analysis allows it to withstand
stresses above a 'A+' rating scenario. The maximum achievable
rating is 'AA', subject to sufficient protection via the AP.

Credem acts as internal account bank. A substitute account bank
(BNP Paribas Securities Services, A+/Stable/F1) is already
appointed and would step in 30 calendar days after Credem's
downgrade below 'BBB+'/'F2'. Fitch considers these counterparty-
related provisions mitigate payment interruption risk up to the
'A+' tested rating on a PD basis, but not at a higher rating. As
a result, Fitch does not expect timely payments on the covered
bond above the 'A+' tested rating on probability of default (PD)
basis.

Fitch gives credit to the highest AP of the last 12 months,
observed in April 2016 (61.4%), disregarding the cash balance on
the accounts. This level of AP provides more protection than the
'A+' breakeven AP which is lower than the 100% legal maximum AP,
up from the previous 78.5%.

Mediobanca OBG

The RWP on the 'A+' rating of Mediobanca's OBG takes into account
the bank's Long-Term IDR of 'BBB+', a newly assigned IDR uplift
of two notches, a newly assigned PCU of six notches and a
recovery uplift of two notches. The programme could be upgraded
as the AP Fitch gives credit to in its analysis allows it to
withstand stresses above a 'A+' rating scenario. The maximum
achievable rating is 'AA', subject to sufficient protection via
the AP.

Fitch considers the principal and liquidity protection combined
with the documented counterparty provisions on the internal
account bank adequate to protect timely payments to the covered
bondholders in rating scenarios up to 'A+'. As a result, Fitch
does not expect timely payments on the covered bond above the
'A+' tested rating on PD basis.

Fitch bases its analysis on the 75.5% highest AP of the last 12
months, observed in September 2016, disregarding the cash balance
on the accounts. The breakeven AP for the current 'A+' rating is
lower than the 100% legal maximum AP, up from the previous 86.5%.

UBI II

The RWP on the 'BBB+' OBG rating of UBI II is based on UBI's
Long-Term IDR of 'BBB', a newly assigned IDR uplift of two
notches, a newly assigned PCU of zero notches, a recovery uplift
of one notch and the 100% contractual AP that Fitch takes into
account in its analysis, which is also the breakeven AP for the
rating. The maximum achievable rating is 'A', subject to
sufficient protection via the AP.

"We have assigned UBI II's OBG a PCU of zero notches because the
cover pool comprises secured loans to small and medium
enterprises, which in Fitch's view are less liquid than
residential mortgage loans." Fitch said. The programme is rated
on a limited uplift basis due to the lack of data provisions.
Fitch uses publicly available information and expects that the
cover assets securing the OBG of this programme are capable of
generating at least good recoveries, compatible with a one-notch
recovery uplift.

UC SB

The RWP on the 'AA' rating of UC SB's OBG takes into account the
bank's Long-Term IDR of 'BBB+', a newly assigned IDR uplift of
two notches, a newly assigned PCU of six notches and a recovery
uplift of two notches. The programme could be upgraded as the
75.7% AP Fitch gives credit to in its analysis allows it to
withstand rating stresses above a 'AA' rating scenario. The
maximum achievable rating is 'AA+'.

Fitch gives credit to the 75.7 % AP recorded in June 2016,
disregarding the cash balance on the accounts, which is the
highest level observed over the last 12 months. The breakeven AP
for the 'AA' rating remains 80.5%.

UC CPT

The 'AA+' rating is driven by UC's Long-Term IDR of 'BBB+', a
newly assigned IDR uplift of two notches, a newly assigned PCU of
eight notches, a recovery uplift of two notches and the 80% AP
that Fitch gives credit to in its analysis. This level of AP is
what the issuer discloses in its investor report (July 2016) and
provides more protection than the revised 'AA+' breakeven AP of
83%, up from the previous 81.5%.

Fitch has revised the Outlook on the OBG rating to Negative from
Stable following the revision of the Outlook on Italy's IDR on 21
October 2016. The programme is rated at Italy's Country Ceiling
of 'AA+'.

CRITERIA VARIATION

BPS

Fitch's analysis of BPS's cover pool varied from its "Criteria
Addendum: Italy - Residential Mortgage Assumptions". The agency
applied a PD adjustment of 1.3 instead of 1.5 to the 39% portion
of loans granted to SAE 614/615 borrowers (artisans and family-
run businesses, as coded by the Bank of Italy) based on the
observed levels of default rates, which in Fitch's view warrants
an adjustment smaller in magnitude than that envisaged by the
criteria. The application of this variation has no impact on the
OBG's rating.

Mediobanca

The agency varied from its "Covered Bonds Rating Criteria" in
order to analyse inflation-linked loans that are part of the
cover pool. The instalment amount, which comprises interest and
principal, resets every 12 months and is capped at the inflation
rate at that point in time. Increases or decreases in interest
rates may determine a slower or faster principal repayment. In
addition, a lengthening of the maturity date by a maximum of 10
years is envisaged by this product. Any principal left unpaid at
that time is taken as a loss by the originator.

In an increasing interest rate scenario, which drives the
breakeven AP for the rating of the programme, the amortisation
profile of inflation-linked loans is stressed considering an
inflation rate equal to half of the corresponding interest rate.
In this scenario, the agency has modelled the programme's cash
flows assuming that the principal loss that materialises after
considering the loans maximum lengthened maturity is left unpaid.

In an increasing interest rate scenario, the interest component
of the instalment that exceeds the instalment amount is not paid,
as the instalment amount is capped at the inflation rate. Fitch
has deducted from the interest revenues the amounts which are
assumed to be lost in a scenario whereby the instalment amount is
higher than the inflation rate. The rating impact of applying
this criteria variation is undetermined.

RATING SENSITIVITIES

The ratings of the mortgage covered bonds (Obbligazioni Bancarie
Garantite, OBG) issued by Banca Carige S.p.A. - Cassa di
Risparmio di Genova e Imperia, Banca Popolare di Sondrio-Societa
Cooperativa per Azioni, Credito Emiliano S.p.A., Mediobanca Spa,
Unione di Banche Italiane S.p.A (UBI) and UniCredit S.p.A. (UC),
guaranteed by UniCredit BpC S.r.l., could be upgraded subject to
the level of protection in the programmes via the asset
percentage (AP) which Fitch relies upon.

The outcome of the rating watch evolving (RWE) on the 'BBB'
rating of Banca Monte dei Paschi di Siena SpA OBG will depend on
the resolution of the RWE on the bank's Long-Term IDR.

The 'AA+'/Negative rating of the OBG issued by UC and guaranteed
by UniCredit OBG S.r.l. would be vulnerable to downgrade if any
of the following occurs: (i) Italy's Country Ceiling is revised
down; or (ii) UC's IDR is downgraded to 'B' or below; or (iii)
the AP that Fitch considers in its analysis increased above
Fitch's 'AA+' breakeven level of 83%.

The 'BBB+'/RWP rating of the OBG issued by UBI and guaranteed by
UBI Finance CB 2 S.r.l. would be vulnerable to downgrade if the
risk of undercollateralisation at the point of resolution
increases, in Fitch's view.

Fitch's breakeven AP for a given OBG rating will be affected,
among other factors, by the profile of the cover assets relative
to outstanding covered bonds, which can change over time, even in
the absence of new issuances. Therefore, the breakeven AP for a
covered bond ratings cannot be assumed to remain stable over
time.


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


KASSA NOVA: S&P Affirms 'B/C' Counterparty Credit Ratings
---------------------------------------------------------
S&P Global Ratings affirmed its 'B/C' long- and short-term
counterparty credit ratings on Kazakhstan-based Kassa Nova Bank
JSC.  The outlook is negative.

At the same time, S&P affirmed its 'kzBB' Kazakhstan national
scale rating on the bank.

The affirmation reflects S&P's expectation that the bank will
maintain strong capitalization, supported by a capital increase
via conversion of a Kazakhstan tenge (KZT) 3.8 billion (about
$11.4 million) subordinated loan into Tier 2 regulatory capital
in October 2016, which compensates for the deteriorated
profitability during the first three quarters of 2016.

The current maturity date of the subordinated loan is in July
2028, and management received a preliminary agreement from the
lender, who is also the shareholder, to extend the maturity of
this instrument to 2033 for the purpose of strengthening its
equity content.  The documentation will be signed by year-end
2016.  In view of this expected term-to-maturity extension, S&P
includes this instrument with intermediate equity content into
its calculation of the bank's total adjusted capital for the
forecast period.  As such, S&P's projected S&P Global Ratings'
risk-adjusted capital (RAC) ratio remains sustainably above 10%
over the next 18 months.

Kassa Nova Bank posted a KZT184 million net loss in the first
nine months of 2016 against KZT934 million net income in 2015.
This loss was due to a sharp compression in the net interest
margin because of the elevated interest rates in the banking
system, the high cost of foreign currency swaps, and negative
trading gains. However, the loss would have been higher had the
bank not made a KZT323 million provision write-back.

According to S&P's base-case assumptions, Kassa Nova Bank will
report losses in 2016, but S&P expects it will start improving
its profitability and achieving return on assets of up to 0.5% in
2017, given the reduction of funding costs in the banking system
and our expectation of gradual economic recovery in Kazakhstan.
This supports S&P's assessment of the bank's capital and earnings
as strong.

The bank's provisioning rate of 17.5% of nonperforming loans
(0.9% of total loans) as of Sept. 30, 2016, is the lowest among
Kazakh banks S&P rates, and is insufficient, in S&P's view.  The
bank wrote back loan loss provisions in the first nine months of
2016 due to recoveries, however S&P expects they will increase to
about 1% in 2016-2017 in line with the banking system in
Kazakhstan.  S&P acknowledges high (269%) coverage of loans by
real estate collateral (mostly residential property) as of Sept.
30, 2016. Nevertheless, realizing such collateral is an arduous
and time-consuming process in Kazakhstan, and real estate prices
have declined considerably since the tenge's devaluation in
August 2015.

S&P still sees vulnerabilities to the bank's profitability
related to Kassa Nova Bank's franchise and business model in the
currently difficult operating conditions in Kazakhstan.  The
bank's franchise and client base remain small compared to peers',
and it has a market share of about 0.4% by assets, which totaled
KZT96.3 billion ($283 million) as of Sept. 30, 2016.  S&P do not
incorporate any additional support from the bank's majority
shareholder Kazakh businessman Bulat Utemuratov.

In S&P's view, the bank's business position remains weak, owing
to its small market share and narrow franchise, and it has a
moderate risk position due to its focus on inherently risky
retail and small and midsized business and the deteriorated
quality of the loan portfolio.  S&P's assessment of average
funding and adequate liquidity stem from its view of the bank's
stable customer-deposit funding and sufficient liquidity cushion.
The long-term rating is at the same level as the stand-alone
credit profile, since S&P do not incorporate any support or
additional factors into the rating.

The negative outlook reflects the pressure on the bank's
creditworthiness, namely on its franchise, asset quality, and
profitability, from the unfavorable operating conditions in
Kazakhstan.

S&P might lower the ratings over the next 12 months if the bank's
franchise deteriorates significantly, due to loss of loan or
deposit customers, continued losses in 2017, or a sharp reduction
in its liquidity cushion.  S&P would also downgrade the bank if
it fails to extend its subordinated loan beyond its current
maturity of 2028, which will result in weakening of its capital
position.

S&P could revise the outlook to stable over the next 12 months if
the operating environment improves, the bank demonstrates
sustainability of its franchise, restores its profitability, and
improves its provisioning to be more in line with peers'.


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


SES SA: S&P Assigns 'BB+' Rating to Proposed Hybrid Securities
--------------------------------------------------------------
S&P Global Ratings said that it had assigned its 'BB+' long-term
issue rating to the proposed perpetual subordinated hybrid
securities to be issued by Luxembourg-based fixed satellite
services operator SES S.A. (BBB/Stable/A-2) and guaranteed by SES
Global Americas Holdings G.P.  The first call date is set at more
than five years after issuance.

The issue's completion and size will be subject to market
conditions.  At this stage, S&P anticipates a ratio of
outstanding hybrid securities to adjusted capitalization at
slightly below 15%.

Upon issuance, S&P will classify the proposed hybrid securities
as having intermediate equity content until no later than the
first call date.

Consequently, in S&P's calculation of SES' credit ratios, it will
reclassify 50% of the principal outstanding and accrued interest
under the proposed hybrid securities as debt, and 50% of the
related payments on these securities as an interest expense.
This is based on S&P's understanding that the hybrid instruments
will be recognized as equity on SES S.A.'s balance sheet.

The two-notch difference between S&P's 'BB+' issue rating on the
proposed hybrid notes and its 'BBB' corporate credit rating (CCR)
on SES S.A. reflects:

   -- One notch for the proposed notes' subordination because the
      CCR on SES S.A. is investment grade; and

   -- An additional notch for the optional deferability of
      interest.

The notching of the proposed securities takes into account S&P's
view that there is a relatively low likelihood that SES S.A. will
defer interest payments.  Should S&P's view change, it may
significantly increase the number of downward notches that it
apply to the issue rating, and S&P could do this more quickly
than taking a rating action on the CCR.

S&P understands that the interest to be paid on the proposed
securities will increase by 25 basis points five years after the
first call date, and a further 75 basis points 20 years after the
first call date.  S&P considers the cumulative 100 basis points
as a moderate step-up, which creates an incentive to redeem the
instruments at that time.  Consequently, in accordance with S&P's
criteria, it classifies the proposed hybrid instruments as having
intermediate equity content.  S&P would no longer recognize the
proposed instruments as having intermediate equity content after
the first call date at the latest, because the remaining period
until their economic maturity would, by then, be less than 20
years.

  KEY FACTORS IN S&P's ASSESSMENT OF THE INSTRUMENTS' PERMANENCE

Although the proposed hybrid securities are perpetual, SES S.A.
can redeem them as of the first call date, which is expected to
occur more than five years after issuance, and every year
thereafter.  If this occurs, the company intends to replace the
proposed instruments, although it is not obliged to do so.

Critically, for S&P's assessment of permanence, it believes that
any repurchase, irrespective of the size, could jeopardize the
equity content of the proposed securities, as it would lead S&P
to question management's intentions to maintain and replace such
securities.

KEY FACTORS IN S&P's ASSESSMENT OF THE INSTRUMENTS'
SUBORDINATION

The proposed securities will be deeply subordinated obligations
of SES S.A., ranking junior to all unsubordinated or subordinated
obligations, and only senior to share capital.

  KEY FACTORS IN S&P's ASSESSMENT OF THE INSTRUMENTS'
DEFERABILITY

In S&P's view, the issuer's option to defer payment of interest
on the proposed securities is discretionary, thus it may elect
not to pay accrued interest on an interest payment date because
it has no obligation to do so.  However, any outstanding deferred
interest payment would have to be settled in cash if an equity
dividend or interest on equal-ranking securities is paid or if
common shares or equal-ranking securities are repurchased.

That said, this condition remains acceptable under S&P's rating
methodology because, once the issuer has settled the deferred
amount, it can choose to defer payment on the next interest
payment date.

The issuer retains the option to defer coupons throughout the
proposed instruments' life.  The deferred interest on the
proposed securities is cash cumulative and compounding.


===================
M O N T E N E G R O
===================


MONTENEGRO: S&P Affirms 'B+/B' Sovereign Credit Ratings
-------------------------------------------------------
S&P Global Ratings affirmed its 'B+/B' long- and short-term
foreign and local currency sovereign credit ratings on the
Republic of Montenegro.  The outlook is negative.

                             RATIONALE

S&P projects that Montenegro's government debt burden will
continue to rise steadily over the forecast horizon to over 80%
of GDP in 2019 from 67% in 2015, while interest costs will rise
to 9% of general government revenues by 2019 from 6% in 2015.  In
the context of already limited monetary flexibility given the
country's unilateral adoption of the euro, the increased leverage
of the public balance sheet will further restrict authorities'
capacity to respond to domestic and external shocks.

Data available on Montenegro's budgetary performance to date
indicates that the fiscal deficit in 2016 has narrowed and is
likely to turn out lower than S&P's initial expectation.  While
S&P notes some revenue growth, much of the deficit reduction
appears to be driven by lower-than-budgeted spending on the Bar-
Boljare highway.  This appears to have offset increases in public
wages by 16% and higher social outlays ahead of the October
parliamentary elections.  However, S&P believes that this
postponed construction expenditure is likely to catch up over
2017-2019.

The construction of the first phase of the Bar-Boljare highway,
currently in progress, commenced in 2015.  Eighty-five percent of
the financing for this phase will be met through a $1.1 billion
(25% of GDP) loan from the Export-Import Bank of China (Chinese
Eximbank) and the remainder via market issuance.  S&P believes
that highway-related spending will keep the general government
deficit above 7% on average over 2017-2019.  Even after the first
phase of the highway, which is 44 kilometers long, is completed,
it is unlikely that general government deficits will narrow
quickly because:

   -- The other phases of the highway will need to be
      constructed, and S&P expects related costs will again flow
      through the government's budget.

   -- Potential cost overruns related to the highway's
      construction, if they have to be borne by the state, could
      increase the government's financing needs.  Although the
      contract with China Road and Bridge Corporation stipulates
      a maximum cost overrun of 10% of the project's value (which
      works out to about 2% of 2016 GDP), it remains unclear who
      would bear such unexpected costs.

   -- Interest expenses are also likely to be higher, increasing
      to 9% of general government revenues in 2019 from 6% in
      2015, reflecting both Montenegro's rising debt and a higher
      effective interest rate.  A sharp depreciation of the euro
      against the dollar, the currency in which Montenegro must
      service its loan from the Chinese Eximbank and on which
      interest payments started in July 2015, could raise
      interest costs further.  S&P understands that the
      government is currently contemplating ways to hedge its
      exchange rate risk.

   -- Poor oversight over the finances of lower tiers of
      governments, which led to the build-up of arrears in the
      past, could complicate efforts to consolidate public
      finances.

S&P do not consider the bilateral loan from the Chinese Eximbank
to be commercial debt.  However, by potentially receiving
preferential treatment, the liability could, in our opinion,
weaken Montenegro's capacity to pay its stock of commercial debt,
which S&P estimates at just over 50% of total government debt.

In addition to the aforementioned risks, S&P views Montenegro's
external finances as an important credit weakness, with narrow
net external debt estimated at 195% of current account receipts
(CARs) in 2016, while liquidity, as measured by gross external
financing needs, is estimated at about 135% of CARs and usable
reserves. Montenegro's use of the euro prevents the Central Bank
of Montenegro from setting interest rates and controlling the
money supply, and restricts its ability to act as a lender of
last resort.  It also makes the country's income highly sensitive
to cross-border capital movements.

Montenegro runs large, persistent, and positive errors and
omissions (about 8% of GDP on average between 2011 and 2015),
which may reflect unrecorded tourism export revenues and the
underestimation of remittances, among other factors.  This could
mean that the current account deficit may be lower than the
reported data indicate.  Also, S&P has very limited information
on Montenegro's external assets; therefore external ratios are
likely to indicate higher net leverage than is actually the case.
What's more, S&P notes that the large current account deficit is
probably tied closely to foreign direct investment (FDI)-related
projects. If such inflows, particularly in the real estate and
construction sectors, were to fall, imports linked to these
projects would also likely decrease and the current account
deficit would narrow.

Partly mitigating all these risks are policymakers' ongoing
efforts to improve tax compliance and formalize the grey
Economy -- an approach that could boost revenue intake.  S&P
notes a significant reduction in contingent liabilities arising
from litigation cases filed against the government after a court
recently ruled in Montenegro's favor in a case filed by the
Central European Aluminum Corp (CEAC) for EUR600 million (16% of
2016 GDP).  CEAC is the former owner of Montenegrin aluminum
producer KAP.  Although the outstanding litigation amount now
stands at a much lower EUR220 million (about 6% of 2016 GDP), an
adverse ruling could weigh further on already-weak fiscal and
debt metrics.

Ongoing projects in the tourism, infrastructure, and energy
sectors will aid real GDP growth of 3.4% per year on average over
2016-2019.  The high import content of many of these projects is
likely to push the current account deficit back over 17% of GDP
over 2017-2019 as activity gains momentum.  Risks to S&P's growth
forecast could materialize if large investment projects were to
stall or if the tourism sector were hit by disruption in key
markets such as Russia.  For the time being, however, S&P notes
that the geopolitical concerns afflicting tourist destinations
such as Turkey, Egypt, and Tunisia, among others, are favoring
tourism in Montenegro.  Furthermore, a long period of low oil
prices might translate into lower FDI inflows, since substantial
inflows come from oil-exporting countries such as Russia and the
United Arab Emirates.

S&P also expects that the pace of credit growth, particularly
related to smaller corporate entities, is likely to remain slow.
Despite efforts to reduce the level of nonperforming loans (NPLs)
on banks' books, the NPL ratio remains high, at 10.2% in
September 2016.

S&P believes the implementation of structural reforms, necessary
for Montenegro to achieve its objective of integration with the
EU and NATO (North Atlantic Treaty Organization), could have a
positive impact on the country's longer-term growth prospects,
particularly if integration is managed without pronounced
repercussions from major trading and investment partners, notably
Russia.  In December 2015, NATO invited Montenegro to join the
alliance, and accession talks commenced in February this year.

The October parliamentary elections handed a victory to the
ruling Democratic Party of Socialists.  An attempted coup on
election day -- viewed by some as an attempt to prevent a pro-
Western cabinet from taking office -- was purportedly averted.
Talks related to the formation of a coalition government are
ongoing and S&P's projections do not take into account any major
shifts in economic or foreign policies.

                              OUTLOOK

The negative outlook reflects S&P's view of the risk of a further
deterioration in Montenegro's fiscal and debt metrics in the
absence of concrete measures to curtail current expenditures.

S&P could lower the ratings over the next six months if it sees a
further erosion of Montenegro's policy flexibility, most likely
through widening fiscal deficits and rising general government
debt; if S&P views pressures building up on the balance of
payments that translate into weaker growth and higher interest
rates; or if any tensions in the run-up to the country's NATO
accession detract policy focus away from stabilizing public
finances.

S&P could revise the outlook to stable if economic growth in
Montenegro picks up faster than S&P anticipates and if it sees an
implementation of measures to achieve a material consolidation of
public finances and a reduction in government and external debt.

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 committee agreed that the debt assessment had improved; all
key rating factors were unchanged.

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.  The weighting of
all rating factors is described in the methodology used in this
rating action.

RATINGS LIST

                                        Rating
                                        To             From
Montenegro (Republic of)
Sovereign Credit Rating
  Foreign and Local Currency            B+/Neg./B      B+/Neg./B
Transfer & Convertibility Assessment   AAA            AAA
Senior Unsecured
  Local Currency                        B+             B+


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


MULTICYCLE INVENTURES: Declared Bankrupt by Zutphen Court
---------------------------------------------------------
Jan-Willem van Schaik at Bike Europe reports that Dutch bike
maker Multicycle has been declared bankrupt by the Court in
Zutphen.

According to Bike Europe, the bankruptcy concerns Multicycle
Inventures Group BV and the four subsidiaries of that holding
company.  It means that the 65 employees of Multicycle lose their
jobs, Bike Europe notes.

The law firm JPR lawyers in Doetinchem, the Netherlands is
handling Multicycle's bankruptcy proceedings and this firm's
Mr. J.C.A Herstel -- herstel@jpr.nl -- is appointed by the
Zutphen Court as administrator, Bike Europe discloses.

On questions by Bike Europe the law firm said that Multicycle
requested for a suspension of payments last Wednesday Nov. 9.
Two days later, the bankruptcy has already been ruled on the
holding company Multicycle Inventures Group BV and its four
subsidiaries including the Multicycle bicycle factory, Bike
Europe relays.


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


HAVILA SHIPPING: Bankruptcy Likely if Creditors Reject Debt Plan
----------------------------------------------------------------
Luca Casiraghi at Bloomberg News reports that Havila Shipping ASA
said it will probably file for bankruptcy unless unsecured
creditors accept a debt-restructuring plan, stepping up pressure
on dissenting bondholders before a key vote next week.

Bankruptcy is the "likely alternative" if the proposal is
rejected on Nov. 23, the operator of oil-rig support vessels, as
cited by Bloomberg, said in a statement on Nov. 14.  It said
contingency plans are in place for a bankruptcy filing, which
would hand control of restructuring to courts and secured
lenders, Bloomberg notes.

Havila, which has been hit by a slump in crude, announced last
week a pledge of new investment from its main shareholder and
support from banks for a plan that would cut its NOK5.2 billion
(US$614 million) of net debt by almost 30%, Bloomberg recounts.
Holders of unsecured notes originally due in August 2016 intend
to scuttle the proposal because they're seeking control of the
Norwegian operator of offshore support vessels, Bloomberg states.

The company has offered to pay back 15% of unsecured debt in cash
and to convert the rest into equity warrants, Bloomberg
discloses.  Holders of more than 33% of Havila's NOK500 million
of August 2016 notes are opposed to the restructuring plan,
enough to derail it, Bloomberg relays, citing an Nov. 10
statement from the bondholder group.

The Nov. 10 statement said the group wants Havila, which has
NOK950 million of unsecured bonds and loans, to undertake a
debt-for-equity swap that would give junior creditors a majority
equity stake, Bloomberg notes.  The dissenting bondholders have
called a creditor meeting for Nov. 24, the day after the vote,
according to Bloomberg.

Havila Shipping has been in default on bond obligations since the
first quarter after creditors rejected a request for a reprieve
on interest payment, Bloomberg says.

Headquartered in Fosnavag, Norway, Havila Shipping ASA operates a
number of vessels, including platform supply vessels, anchor
handling tug supply vessels, and rescue and recovery vessels.
The Company provides supply services to offshore companies both
national and international.


LOCK LOWER: S&P Puts 'B+' Ratings on CreditWatch Positive
---------------------------------------------------------
S&P Global Ratings placed its 'BBB-/A-3' long- and short-term
counterparty credit ratings on Sweden-based credit management
services provider Intrum Justitia AB on CreditWatch with negative
implications.  At the same time, S&P placed its 'B+' long-term
counterparty credit ratings on Norway-based credit management
services provider Lock Lower Holdings AS (Lindorff) and its
subsidiary Lock AS on CreditWatch with positive implications.

The CreditWatch placements follow the announcement on Nov. 13,
2016, that Intrum and Lindorff have agreed to combine and reflect
the terms disclosed by the two companies in their announcement.
The proposed transaction is an all-share offer through which
Lindorff's current owner, Swedish private equity firm Nordic
Capital, will retain 45.5% ownership in the combined company via
its indirect majority ownership in Cidron 1748 S.a r.l.  Intrum
will remain listed on the Stockholm stock exchange with existing
shareholders retaining 53.5% ownership, subject to shareholder
approval.  Nordic Capital, via Cidron 1748 S.a r.l., expects to
receive the right to appoint three of eight members to the
enlarged Intrum's Board of Directors.  The deal is expected to
close during the second quarter of 2017 and is subject to
shareholder, regulatory, and competition authority approvals in a
number of European markets.

The combination of two of Europe's largest and most diverse
credit management service companies would create the undisputed
European leader in the segment, protecting both parties from an
expected wave of further consolidation in the sector.  Combined
cash EBITDA for both entities is an estimated Swedish krona (SEK)
8 billion (EUR810 million at EUR0.10/SEK1) through the first
three quarters of 2016, which is at least twice as large as the
next largest peer.  Cash EBITDA growth is also up considerably,
from SEK6.5 billion throughout 2015 and SEK5.8 billion throughout
2014, owing to further expansion of debt purchasing activity and
acquisitions.

The companies have identified SEK800 million of annual cost
synergies achievable by 2020 via consolidation of headquarters,
IT infrastructure, and staff functions (excluding approximately
SEK1 billion of associated restructuring charges).  The enlarged
Intrum also anticipates unquantified revenue synergies by
positioning itself for market growth in unsecured consumer
nonperforming debt while also entering new asset classes of
secured debt, small and midsize enterprise (SME) loans, and real
estate services.  In addition, S&P expects the combined entity
will considerably reduce interest costs associated with
Lindorff's outstanding debt while leveraging combined data
strengths in pricing future portfolio acquisitions.

Intrum and Lindorff are already leaders in debt purchasing and
third-party servicing of nonperforming unsecured consumer loans
in many European countries.  Historically, Intrum has thrived in
third-party collections and industry and trade debt purchasing,
while Lindorff has focused more on larger transactions and
carving out collections operations for financial institutions.
Recently, both entities have moved into new markets, with Intrum
announcing acquisitions of secured mortgage loans in Hungary and
of U.K.-based 1st Credit, a midsize U.K. debt purchaser.
Lindorff recently acquired a majority stake in the Spanish
mortgage-loan servicer Aktua, which it believes will provide a
platform for servicing nonperforming and foreclosed secured
residential loans.

Geographically, the combined entity has a pan-European presence
with key markets in the Nordics, Switzerland, Eastern and Central
Europe, Spain, Germany, and France, alongside a presence in most
other Western European countries.

Based on the terms of the combination agreement and a pro forma
capital structure, S&P would most likely assess the group credit
profile (GCP) of the combined group at 'bb+', which is a notch
lower than S&P's current rating on Intrum and three notches
higher than S&P's ratings on Lindorff entities.  Because S&P
lacks detailed information at this stage, S&P's GCP assessment is
provisional.  S&P will determine its assessment upon completion
of the proposed combination, a review of the eventual capital
structure, and the company's future plans for business
development, leverage, cash flow, and revenue generation.

S&P bases its expectation of a 'bb+' GCP for the combined group
on a pro forma leverage upon consolidation and management's
stated intent to reduce leverage over the next few years.
However, S&P remain conservative in its future leverage
assumptions given the abundance of growth and acquisition
opportunities in the market and the recent leverage trajectories
of both companies prior to the proposed combination.  In
addition, S&P notes that Nordic Capital will become a key and
influential shareholder in Intrum. S&P anticipates that Nordic
Capital's ownership and influence will decline over a two-to-
three year exit horizon and note that it was already seeking an
exit strategy following a September 2016 announcement of plans
for an IPO for Lindorff.

The expected 'bb+' GCP also takes account the potential
improvements in diversity, efficiency, and market leadership post
merger.  But S&P also notes a number of execution risks in the
early stages of the merger.  The need to incorporate the other
recent acquisitions--Aktua and 1st Credit--and growth into new
European markets present an additional challenge for the combined
group's leadership.

The rating implications for Lindorff's existing debt instruments
are unclear at the time of writing.  S&P thinks that a number of
these rated instruments could be refinanced with bridge financing
at more attractive spreads given the resulting improved
creditworthiness from the link-up with the higher-rated and less-
leveraged Intrum.

S&P intends to resolve the CreditWatch placements on Intrum and
Lindorff upon completion of the proposed combination.

"If we assess the GCP of the combined Intrum/Lindorff entity as
'bb+', in line with our provisional view, we would likely lower
our long-term rating on Intrum to 'BB+' from 'BBB-'.  In this
scenario, we would likely raise our ratings on Lindorff entities
to 'BB+' from 'B+'.  The rating outcomes could differ if our
analysis of the combined group results in a higher or lower GCP
upon completion of the merger, or if we change our view of the
likely role of each rated entity in the enlarged group.  The
impact on the issue ratings of Lindorff's debt instruments are
subject to recovery ratings as per our criteria.  As such, the
impact on these ratings remains uncertain at present and would
depend on the resulting capital structure," S&P said.

If the combination does not proceed for any reason, S&P would
likely affirm its ratings on Intrum and Lindorff.  However, for
Lindorff without a merger, S&P would need to take into
consideration Nordic Capital's alternative exit strategies as
well as any changes to the capital structure to review S&P's
assessment of the company's financial risk profile.



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


BALTIC FINANCIAL: S&P Affirms 'B-/C' Counterparty Credit Ratings
----------------------------------------------------------------
S&P Global Ratings said that it had affirmed its 'B-' long-term,
and 'C' short-term counterparty credit ratings on Russia-based
Baltic Financial Agency Bank (BFA).  The outlook remains stable.

S&P also affirmed the 'ruBBB' Russia national scale rating.

The affirmation reflects S&P's view that, despite business
contraction in 2016, the bank will be able to cover its all
financial commitments prior to the merger with BANK URALSIB, and
therefore does not fit S&P's definition for a 'CCC+' issuer
credit rating.

S&P expects BFA to merge with the much larger BANK URALSIB within
the next 12 months.  The two banks have reached a certain degree
of operational integration, including a joint ATM network and
aligned treasury function, but S&P don't see them as a group
because the regulators have not yet officially approved the
merger.

The bank's business volumes started to decrease in 2016, with the
corporate loan book declining by about 26% for the first nine
months of 2016 under Russian Accounting Standards as exposures
matured and were not renewed.  S&P understands that, in the
context of the upcoming merger, BFA's management is now focused
on the future integration into BANK URALSIB, rather than growing
its own business.  Therefore S&P believes BFA's stand-alone
market position is now weaker than that of its peers.  S&P has
consequently revised its assessment of BFA's business position to
weak.

The bank historically had a large portion of its securities
portfolio funded by repurchase agreements (repo) with the Russian
central bank, which distorts its net interest margin.  In the
second quarter of 2016, the bank managed to sell the repo-funded
portfolio part, comprising about 75% of the investment portfolio,
and to repay the corresponding facilities.  S&P believes this
will positively affect the bank's operating results.  S&P has
consequently revised its forecast-based on the assumption that
the net interest margin will rise to 3% over the next 12 months
from 0.5% in 2015.  This will result in a risk-adjusted capital
(RAC) ratio rebounding to around 5% at the end of 2016.  However,
S&P still believes that the bank has limited earnings capacity,
reflected in its negative assessment of the earnings buffer, and
it will make a loss in 2016.

Given the loan book contraction and the stable credit quality of
most of the bank's clients, S&P do not expect further asset
quality deterioration.  The cost of risk will stay under 2.3% as
provisioning on existing nonperforming loans accrues.

S&P thinks that the decline in the bank's customer funds accounts
is primarily due to repayment of several large corporate deposits
and does not indicate a decline in the confidence of the
clientele.  Following the sale of the securities portfolio, S&P
expects that broad liquid assets will cover the bank's short-term
wholesale funding by 3x and net broad liquid assets will continue
to cover around 50% of short-term customer deposits.

The stable outlook reflects S&P's opinion that the BFA will be
able to cover all its financial commitments in the next 12
months.

S&P may take a negative rating action if it sees the confidence
of bank's clientele has significantly reduced, and the liquidity
buffer, which S&P currently considers to be sufficient, has
become insufficient and the bank is dependent upon favorable
business conditions to meet its obligations.

A positive rating action is remote at this stage, as it would
require a significant improvement in the bank's capitalization
and asset quality indicators, all other things being equal.


LSR GROUP: Fitch Affirms 'B' Long-Term Foreign Currency IDR
-----------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Foreign-Currency Issuer
Default Rating (IDR) of OJSC LSR Group at 'B'. Fitch has also
affirmed the senior unsecured rating of the outstanding bond
issues at 'B'.

The affirmation of the ratings reflects the company's solid
performance in the Russian real estate market and stable
operational dynamics. Although the Russian macroeconomic
environment is challenging, the property market is improving as
the Central Bank's lower refinancing rate drives the mortgage
volumes to historical levels.

KEY RATING DRIVERS

Mortgage Market Stabilising

The macroeconomic environment in Russia continues to be
challenging highlighted by the bankruptcy of major Russian real
estate player (SU-155), which was hard hit by the economic
downturn due to its high leverage and inability to cover working
capital outflows. Fitch expects mortgage market volumes to be
below the peak levels of 2014, although the Central Bank's
decision to cut interest rates has stabilised the market as the
number of mortgage approvals is rising. Fitch expects the Russian
government's subsidy of the mortgage interest rates to be
extended into 2017, which is likely to support volumes.

LSR Can Weather Cycle

Macroeconomic risks are somewhat mitigated by LSR's position in
Russia's key markets of St. Petersburg and Moscow along with
financial flexibility as evidenced by its ability to cut dividend
distributions. LSR's resilience to the adverse market conditions
has improved since the 2008/09 crisis due to its moderate debt
level and minimal capex requirements. However, the extent of
possible medium-term negative market pressure remains uncertain.

Top-Five Developer in Russia

LSR is one of the top-five real estate developers in the highly
fragmented Russian residential construction market. The company
is the leading homebuilder for high-end residential real estate,
and is also one of the leading mass market real estate players in
St. Petersburg and Moscow. LSR is also the leading building
materials producer in north-western Russia.

Increasing Geographical Diversification

LSR's real estate portfolio is mainly located in the St.
Petersburg and the surrounding Leningrad region (70% of the net
sellable area and 60% of the market value). However, the
geographical diversification has increased with the acquisition
of the ZiL and Luchi projects of 2.5 million sq. m. of gross
buildable area in Moscow in mid-2014. This should boost sales
over 2017-2018 when the revenue from the presales of the Moscow
projects begin to be realised. Fitch believes that these projects
will significantly reduce LSR's high regional concentration over
the medium term.

Higher Leverage Expected

Fitch expects LSR's EBITDA and FFO to remain solid over 2016-
2019. However, the agency expects adverse market conditions and
the development of the large ZIL project to result in large
working capital outflows in 2016-2017 on the back of a lower-
than-normal level of prepayments from customers. This could lead
to an increase in the company's FFO net leverage to above 3.0x
over 2016-2019 from the current 1.4x. Even at the higher level
leverage would remain within our negative rating guideline of
4.0x.

Integrated Business Model

LSR's integrated building materials operations contributed 19% of
revenue and 21% of EBITDA in 2015, a decrease from 23% and 29%,
respectively, a year earlier. Vertical integration supports the
ratings due to better input cost control and exposure to the less
volatile infrastructure construction, which in turn is supported
by the government. Fitch expects the share of building materials
to decrease further as the company has sold its cement business.

Operating Environment Discount

Fitch applies a one-notch discount for the company's exposure to
the Russian operating environment from the standalone rating
level of the company of 'B+'.

DERIVATION SUMMARY

LSR's ratings incorporate industry cyclicality and capital
intensity, high execution risk should the company develop too
many projects simultaneously, lack of medium-term certainty over
project development, and higher-than-average risks associated
with the Russian business environment and jurisdiction. This is
partly mitigated by LSR's relatively low leverage (FFO net-
adjusted leverage of 1.4x in FY15) as well as increasing
geographical diversification.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Our Rating Case for the Issuer
Include

   -- 10%-15% cut of prepayments received by the company from the
      normal rate

   -- 5%-10% drop of prices in building materials and real estate

   -- Average annual capex of RUB2.2bn in 2016-2019

   -- Average cost of new borrowings of 15% vs current 12%

   -- Dividend pay-out at 80% of net profit

RATING SENSITIVITIES

Future Developments That Could Lead to Positive Rating Action
Include

   -- Improved visibility on the short-term direction of the
      Russian real estate market environment over the next 12
      months.

   -- Sustainable improvement in the financial metrics leading to
      EBIT margin above 15%.

   -- FFO-adjusted gross leverage sustainably below 3x.

   -- Positive FCF generation on a sustained basis.

Future Developments That Could Lead to Negative Rating Action
Include:

   -- Market deterioration leading to EBIT margin below 10%
      and/or worsened liquidity.

   -- FFO-adjusted gross leverage sustainably above 4x.

LIQUIDITY

Overall, the liquidity position is satisfactory in our view, with
short-term debt standing at RUB12.4bn at August 31, 2016, while
the company's cash position stood at RUB19bn. This, coupled with
available undrawn credit facilities of RUB21.4bn from VTB,
Sberbank and Alfa-Bank, should be sufficient to cover immediate
liquidity. "We note that the company does not pay commitment fees
for the undrawn credit facilities, which is a common practice in
Russia," Fitch said. The company is not exposed to FX risk, as
all of the debt is raised in roubles.

FULL LIST OF RATING ACTIONS

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

   -- Local currency senior unsecured rating affirmed at 'B',
      Recovery Rating 'RR4'


PERESVET BANK: Central Bank Discusses Financial Recovery
--------------------------------------------------------
PRIME reports that Russia's central bank is discussing financial
recovery of Peresvet Bank, the country's 43rd largest bank by
assets, together with the bank's creditors, Central Bank Deputy
Chairman Vasily Pozdyshev on Nov. 15 said.

The central bank introduced an interim management at the bank for
six months on Oct. 21 and a moratorium on fulfillment of
liabilities to the bank's creditors, PRIME recounts.

According to PRIME, earlier on Nov. 15, Kommersant business daily
reported that the central bank had worked out an offer to
shareholders and creditors of Peresvet Bank and had offered a
financial recovery through the bail-in mechanism with attraction
of an external turnaround manager.  The business daily, as cited
by PRIME, said the total cost of the bailout may reach RUR106.2
billion.


RN BANK: Fitch Affirms 'BB+' LT Issuer Default Rating
-----------------------------------------------------
Fitch Ratings has revised Joint Stock Company RN Bank's (RNB)
Outlook to Positive from Stable, while affirming the Long-Term
Issuer Default Rating (IDR) at 'BB+'. The agency has also
assigned RNB's fixed-rate RUB-denominated bond a Long-term rating
of 'BB+'.

KEY RATING DRIVERS

The Outlook change reflects a similar rating action on Renault SA
(BBB-/Positive), one of RNB's shareholders.

RNB's IDRs, National Rating and Support Rating reflect the
potential support the bank may receive, if needed, from the
bank's foreign shareholders. The bank is owned by UniCredit
S.p.A. (BBB+/Negative) with a 40% stake; by Renault SA (BBB-
/Positive) through its subsidiary RCI Banque with a 30% stake,
and by Nissan Motor Co., Ltd. (BBB+/Stable) with a 30% stake.

In assessing the probability of support, Fitch views positively
(i) the strategic importance of the Russian market for Renault
and Nissan and the important role of RNB in supporting the two
auto companies' business; (ii) the track record of support, and
in particular the predominance of shareholder funding in RNB's
liabilities; and (iii) RNB's small size relative to the owners,
limiting the cost of potential support.

At the same time, RNB's Long-Term IDRs are notched down from
those of the bank's shareholders due to (i) each individual owner
being a minority shareholder, which may reduce their propensity
to provide support; and (ii) Fitch's view that reputational risks
for the owners would probably be containable in case of RNB's
default.

The senior unsecured debt (RUB-denominated local bonds) is rated
in line with the Long-Term IDR, according to Fitch's criteria for
rating such instruments.

RATING SENSITIVITIES

An upgrade of Renault's IDR would most likely result in an
upgrade of RNB's support-driven ratings provided that the Russian
market remains strategically important for the Renault-Nissan
Alliance and RNB's parental funding is not significantly replaced
by third-party funding.

A weakening of the credit profiles of RNB's shareholders,
undermining their ability to support the Russian bank, could lead
to a downgrade of RNB's ratings, as could a reduction in the
importance of RNB for the development of business of Renault and
Nissan in Russia.

A marked increase in the share of third-party funding of RNB
without recourse to the bank's shareholders could also, in
Fitch's view, somewhat erode the owners' propensity to support
RNB and could result in a downgrade of its ratings.

The senior unsecured debt rating is sensitive to changes in the
bank's IDR.

The rating actions are as follows:

   -- Long-Term Foreign and Local Currency IDRs: affirmed at
      'BB+'; Outlook revised to Positive from Stable

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

   -- National Long-Term rating: affirmed at 'AA+(rus)'; Outlook
      revised to Positive from Stable

   -- Support Rating: affirmed at '3'

   -- Senior debt long-term Rating: assigned at 'BB+'


===========
S E R B I A
===========


JUGOREMEDIJA: Declared Bankrupt, Court Orders Asset Sale
--------------------------------------------------------
SeeNews reports that a Serbian court said it declared
pharmaceutical company Jugoremedija bankrupt and ordered the sale
of its assets to repay the debt to creditors.

According to SeeNews, Zrenjanin Commercial Court said in a ruling
issued on Nov. 9 Jugoremedija's biggest creditor, Heta Real
Estate Serbia, a subsidiary of Austria's Heta Asset Resolution,
had not delivered a viable restructuring plan for the drug maker
within the deadline.

Jugoremedija's accounts payable stood at RSD2.9 billion (US$25.4
million/EUR23.5 million) while total liabilities amounted to
RSD3.2 billion as of 2013, SeeNews relays, citing the latest
available data published on the website of the Serbian trade
registry.

The court declared Jugoremedija insolvent in December 2012 when
the total value of its assets stood at EUR22 million (IS$23.6
million), SeeNews recounts.

Back then, Heta Real Estate took control of the company and
maintained the production of drugs, committing to drafting a
restructuring plan aimed at healing Jugoremedija and selling the
business at a later stage, according to SeeNews.

In April 2013, Novi Sad-based company Union-medic rented
Jugoremedija's factory in Zrenjanin at a public auction, SeeNews
states.  Union-medic's owner and CEO Milan Selakovic was the only
bidder, and he agreed to pay a monthly rent of EUR50,000, SeeNews
relates.  However, as Serbian news agency Tanjug reported on
Nov. 11, Union-medic had terminated the rental contract nine
months before the Zrenjanin Commercial Court ruling, SeeNews
notes.



=============================
S L O V A K   R E P U B L I C
=============================


SLOVAKIA: Trnava Region Proposes Liquidation of Piestany Airport
----------------------------------------------------------------
The Slovak Spectator reports that the small airport near the spa
town of Piestany has been in red numbers for some time already.

The Trnava Region Governor, Tibor Mikus, explained for the SITA
newswire that its liquidation will mean stopping air traffic, but
not digging up the airport land, according to The Slovak
Spectator.  If shareholders approve this move, the airport will
stop offering its services within a few days, the report notes.

Around 30 employees of the airport company will lose jobs.

Apart from the Trnava Region (59,31 %), other shareholders are
the town of Piestany (20,04 %) and the Transport Ministry (20,65
%), the report relays.

Last year, about 2,000 people used its services, while this year,
the number is much smaller, the report recalls.  The airport also
reports a dramatic drop in cargo transport, the report notes.
Part of the property includes plots of more than one hundred
hectares, the report says.

Mikus explained that the proposal would prevent further claims
and debts by its liquidation, as otherwise, it could go into
bankruptcy proceedings and creditors would take over control, the
report relays.

The town of Piestany absolutely does not agree with the
liquidation of the airport, Mayor Milos Tamajka said, pointing to
the fixed assets of more than EUR20 million and claims amounting
to about 10 percent of this figure, the report notes.  Piestany
is ready to help the company, but under the condition that board
members give up their claims to unpaid salaries, the report says.
Mikus confirmed for SITA that the claim concerning unpaid
salaries or rewards for board members and representatives is
about EUR600,000 and belongs among the biggest items, the report
relays.

                            Generating Loss

Despite austerity measures, the airport generates a loss of about
EUR30,000 per month and has been reporting losses for several
years, the report notes.  Last year, the development seemed
positive, with numbers of passengers and transported cargo
growing but this year, the positive trend stopped, the report
relays.

Chair of the board of the Letisko Piestany company, Remo Cicutto,
sees competition of Bratislava and Vienna-Schwechat airports
behind the weak interest in Piestany, the report says.

The Transport Ministry as minority shareholder informed SITA that
it will study the documents meant for talks before the general
assembly and consider all possibilities, while taking their
stance at the assembly, the report discloses.

In 2015, the ministry gave Piestany airport subsidies of more
than EUR256,000 -- more than EUR30,400 compared to last year, the
report relays.

Last year, the Piestany airport generated a loss of EUR450,700 --
EUR86,200 less than in 2014, with a net turnover amounting to
EUR504,300 (EUR206,000 more against the previous year), the
report relays.  The income from economic activities (EUR389,500)
declined against the previous year by EUR49,700. By the end of
2015, the company had assets amounting to EUR22.52 million -- a
EUR97,200 decrease year on year, the report adds.


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


ABENGOA SA: Posts Nine-Month Loss of EUR5.4 Billion
---------------------------------------------------
Angus Berwick at Reuters reports that Abengoa SA reported a
nine-month net loss of EUR5.4 billion (US$5.80 billion) on Nov.
14, the week after a court signed off on its debt restructuring
plan which should allow it to avoid bankruptcy.

The Seville-based company said the profit loss was due
principally to huge provisions on deteriorating assets and the
slowdown of its business over the past year as it has sold of
assets and slashed its workforce to keep afloat, Reuters relates.

Abengoa's nine-month core profit -- or earnings before interest,
tax, debt and amortization (EBITDA) -- was a loss of EUR90
million, Reuters discloses.  Last year, Abengoa reported a nine-
month net profit loss of EUR194 million, Reuters recounts.

Abengoa said on Nov. 14 its gross debt remained above EUR9
billion as of the end of September, Reuters relays.

                      About Abengoa S.A.

Spanish energy giant Abengoa S.A. is an engineering and clean
technology company with operations in more than 50 countries
worldwide that provides innovative solutions for a diverse range
of customers in the energy and environmental sectors.  Abengoa is
one of the world's top builders of power lines transporting
energy across Latin America and a top engineering and
construction business, making massive renewable-energy power
plants worldwide.

As of the end of 2015, Abengoa, S.A. was the parent company of
687 other companies around the world, including 577 subsidiaries,
78 associates, 31 joint ventures, and 211 Spanish partnerships.
Additionally, the Abengoa Group held a number of other interests
of less than 20% in other entities.

On Nov. 25, 2015 in Spain, Abengoa S.A. announced its intention
to seek protection under Article 5bis of Spanish insolvency law,
a pre-insolvency statute that permits a company to enter into
negotiations with certain creditors for restricting of its
financial affairs.  The Spanish company is facing a March 28,
2016, deadline to agree on a viability plan or restructuring plan
with its banks and bondholders, without which it could be forced
to declare bankruptcy.

On March 16, 2016, Abengoa presented its Business Plan and
Financial Restructuring Plan in Madrid to all of its
stakeholders.

                        U.S. Bankruptcy

Abengoa, S.A., and 24 of its subsidiaries filed Chapter 15
petitions (Bankr. D. Del. Case Nos. 16-10754 to 16-10778) on
March 28, 2016, to seek U.S. recognition of its restructuring
proceedings in Spain.  Christopher Morris signed the petitions as
foreign representative.  DLA Piper LLP (US) represents the
Debtors as counsel.

Involuntary petitions were filed against the three affiliated
entities -- Abengoa Bioenergy of Nebraska, LLC, Abengoa Bioenergy
Company, LLC, and Abengoa Bioenergy Biomass of Kansas, LLC
under Chapter 7 of the Bankruptcy Code in the United States
Bankruptcy Court for the District of Nebraska and the United
States Bankruptcy Court for the District of Kansas.  The
bankruptcy cases for affiliate Abengoa Bioenergy of Nebraska, LLC
and Abengoa Bioenergy Company, LLC were converted to cases under
chapter 11 of the Bankruptcy Code and transferred to the United
States Bankruptcy Court for the Eastern District of Missouri.

On Feb. 24, 2016, Abengoa Bioenergy US Holding, LLC and 5 five
other U.S. units of Abengoa S.A., which collectively own,
operate, and/or service four ethanol plants in Ravenna, York,
Colwich, and Portales, each filed a voluntary petition for relief
under Chapter 11 of the United States Bankruptcy Code in the
United States Bankruptcy Court for the Eastern District of
Missouri.  The cases are pending before the Honorable Kathy A.
Surratt-States and are jointly administered under Case No. 16-
41161.

Abeinsa Holding Inc., and 12 other affiliates, which are energy,
engineering and environmental companies and indirect subsidiaries
of Abengoa, filed Chapter 11 bankruptcy petitions (Bankr. D. Del.
Proposed Lead Case No. 16-10790) on March 29, 2016.

The Chapter 11 petitions were signed by Javier Ramirez as
treasurer. They listed $1 billion to $10 billion in both assets
and liabilities.

Abener Teyma Hugoton General Partnership and five other entities
filed separate Chapter 11 petitions on April 6, 2016; and Abengoa
US Holding, LLC, Abengoa US, LLC and Abengoa US Operations, LLC
filed Chapter 11 petitions on April 7, 2016.  The cases are
consolidated under Lead Case No. 16-10790.

DLA Piper LLP (US) represents the Debtors as counsel.  Prime
Clerk serves as the Debtors' claims and noticing agent.

Andrew Vara, acting U.S. trustee for Region 3, appointed five
creditors of Abeinsa Holding Inc. and its affiliates to serve on
the official committee of unsecured creditors.

The Abeinsa Committee is represented by MORRIS, NICHOLS, ARSHT &
TUNNELL LLP's Robert J. Dehney, Esq., Andrew R. Remming, Esq.,
and Marcy J. McLaughlin, Esq.; and HOGAN LOVELLS US LLP's
Christopher R. Donoho, III, Esq., Ronald J. Silverman, Esq., and
M. Shane Johnson, Esq.



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


BASE STRUCTURES: Files for Liquidation
--------------------------------------
Liam Stoker of Solar Power Portal reports that the saga of The
Solar Cloth Company (TSCC) has taken a further twist after Base
Structures, the company which acquired the failed installer's
assets, filed for liquidation itself.

Crowdcube-funded TSCC entered administration in June this year,
however various parties immediately stepped forward and expressed
an interest in acquiring its assets in an attempt to revive the
company's work, according to Solar Power Portal.

A sale was concluded a fortnight later, however TSCC's
administrators Irwin & Co could not at the time disclose the
identity of the buyer, the report notes.  The business was not
sold as a going concern, and those who invested in the company
via its crowdfunding campaigns lost their investment, the report
relays.

Solar Power Portal can now reveal however that the buyer of TSCC
assets was Base Structures, the Bristol-based tensile structures
firm that merged with TSCC in April this year as part of a major
play to target the solar carport market in the UK, the report
discloses.

Base Structures and its director Christopher Ives were the second
largest shareholders in TSCC at the time of its collapse, owning
a combined stake of around 16%, the report notes.  Its largest
shareholder -- Peregrine Sakata Carroll -- owned 65%.

Base Structures has, however, now suffered a similar fate to
TSCC, filing for liquidation in late October and appointing the
same insolvency practitioners -- Irwin & Co -- as TSCC, the
report notes.

It remains unclear what will now happen to the TSCC assets now
that their second owner this year has collapsed with more than
GBP1 million in debt, much of which is owed to trade and expense
creditors and redundancy claims, the report says.

Base Structures could not be contacted, and Irwin & Co have yet
to respond to requests for comment after being contacted by SPP.


ENQUEST PLC: Creditors Back Restructuring Plans, Hearing Today
--------------------------------------------------------------
Mark Lammey at Energy Voice reports that EnQuest's creditors
overwhelmingly backed the firm's restructuring plans on Nov. 14.

The company said 1,931 scheme creditors -- 85% of the total --
voted on the measures on Nov. 13 at a meeting in London or by
proxy, Energy Voice relates.  It said 99.9% opted to support the
proposals, Energy Voice notes.

But the restructuring is not over the line yet, Energy Voice
states.  EnQuest said the scheme must be sanctioned by the
Companies Court, Energy Voice relays.

According to Energy Voice, a hearing at the court is scheduled to
take place today, Nov. 16.

The company, which had net debts of GBP1.38 billion as of June
30, said the restructuring would add GBP195 million to its
balance sheet and extend final repayment until 2021, Energy Voice
relates.

                         About EnQuest

As of Aug. 31, 2016, the Group employed approximately 433 people,
approximately 291 of which work in the U.K.  The Debtor's U.S.
assets are (i) a $50,000 undrawn professional fee retainer held
by Paul, Weiss, Rifkind, Wharton & Garrison LLP, as counsel to
the Foreign Representative and the Debtor, in a non-interest
bearing account located with Citibank, N.A. in New York, New
York, and (ii) intangible contract rights under the High
Yield Notes Indenture, which is governed by New York law.

The Group's average daily production on a working interest basis
for the six-month period ending on June 30, 2016, was 42,520
boepd, and its net 2P reserves were 216 MMboe as of January 1,
2016.  During the first half of 2016, the Debtor's producing
assets generated EBITDA of $242.9 million.

The Debtor listed total consolidated assets of $3.97 billion and
total consolidated liabilities of $3.23 billion as of June 30,
2016.


RELATE SHROPSHIRE: In Liquidation, Staff Owed Hundreds of Pounds
----------------------------------------------------------------
Shropshire Star reports that Relate Shropshire, Herefordshire and
North Staffordshire began a liquidation process.

Its offices in Shrewsbury and shops around the region closed
their doors and more than 70 people lost their jobs, according to
Shropshire Star.

But now workers have been told they will not be paid their wages
and need to contact the official liquidators to pursue any claim
for monies outstanding, the report notes.

Most of the staff who have lost their jobs were part-time
employees -- they include 42 counsellors, 11 trainers, 11 shop
managers and eight office support staff, the report relays.
Around 40 volunteers were also involved in staffing its shops.

One worker, who did not wish to be named, said: "We are owed
between four and six weeks money and have been told we will not
not get it until after the creditors meeting has taken place, the
report discloses.

Relate, which had been operating in the county for 20 years, had
charity shops in Oswestry, Shrewsbury, Church Stretton,
Wellington, Ellesmere, Wem and Market Drayton as well as its head
office in the heart of Shrewsbury, the report notes.

It also ran lottery lunches as well as regular fund raising
events such as ladies' days and an annual Christmas dinner, the
report says.

It is understood that staff will be able to claim pay owed up to
October 27 as well as redundancy, pay in lieu of holidays not
taken and sundry other benefits, the report discloses.

A briefing was held last week, the day before the news broke that
the charity, which provided counselling for up to 12,000 clients
per year, had gone bust at which the matter was discussed between
staff and management, the report adds.



                            *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true value
of a firm's assets.  A company may establish reserves on its
balance sheet for liabilities that may never materialize.  The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.


                            *********


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

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

Copyright 2016.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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Information contained herein is obtained from sources believed to
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The TCR Europe subscription rate is US$775 per half-year,
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members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
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