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

                           E U R O P E

          Thursday, December 22, 2016, Vol. 17, No. 253


                            Headlines


B E L A R U S

BELARUSIAN NATIONAL: Fitch Affirms B- IFS Rating, Outlook Stable


G E R M A N Y

HSH NORDBANK: Moody's Affirms B2 Subordinated Debt Ratings


G R E E C E

ALPHA BANK: Fitch Affirms 'CCC+' Mortgage Covered Bonds Rating
GREECE: Willing to Accept Mutual Compromises with Creditors


I R E L A N D

ARBOUR CLO: Fitch Affirms 'B-sf' Rating on Class F Notes
GLG EURO II: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes
TAURUS 2015-2: Moody's Affirms B2 Rating on EUR39.786MM F Notes


I T A L Y

ITALFINANCE SECURITISATION: Moody's Affirms B1 Cl. D Notes Rating
MONTE DEI PASCHI: Rescue Likely After Parliament OK's Bailout


L U X E M B O U R G

GALAPAGOS HOLDING: Moody's Lowers Corporate Family Rating to B3
MAUSER HOLDING: Moody's Assigns B3 Corporate Family Rating


N E T H E R L A N D S

NEPTUNO CLO II: Moody's Affirms Ba2 Rating on Class D Notes


N O R W A Y

EKSPORTFINANS ASA: Moody's Assigns Ba2 Baseline Credit Assessment


P O L A N D

ROOF POLAND 2014-DAC: Fitch Affirms BB-sf Rating on Cl. B Notes
TAURON POLSKA: Fitch Rates EUR190-Mil. Hybrid Bonds 'BB+'


P O R T U G A L

BANCO ESPIRITO: 4,000 Retail Customers to Recover 60% of Claims


R U S S I A

RUSSIAN HELICOPTERS: Moody's Hikes Corporate Family Rating to Ba2
TATFONDBANK PJSC: 3-Month Moratorium on Satisfying Claims Imposed
VNESHPROMBANK: Files RUR1-Bil. Claim Against Former President


U K R A I N E

CHPP PJSC: Declared Bankrupt by Odesa Court, Owes UAH710 Million
FINANCIAL INITIATIVE: Bankruptcy Ruling Valid, Appeals Court Says


U N I T E D   K I N G D O M

GHA COACHES: Welsh Gov't Provides Grant Following Administration
INTERNATIONAL PERSONAL: Fitch Puts 'BB+' IDR on Rating Watch Neg.


                            *********


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B E L A R U S
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BELARUSIAN NATIONAL: Fitch Affirms B- IFS Rating, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed Belarusian National Reinsurance
Organisation's Insurer Financial Strength (IFS) Rating at 'B-'.
The Outlook is Stable.

KEY RATING DRIVERS

The rating and Outlook mirror Belarus's 'B-'/Stable Long-Term
Local Currency Issuer Default Rating (IDR) and reflect the
reinsurer's 100% state ownership. The rating also reflects the
reinsurer's exclusive position in the local reinsurance sector
underpinned by legislation, and fairly strong underwriting
profitability, the fairly low quality of the reinsurer's
investment portfolio, and significant amount of reinsured
domestic surety risks.

The Belarusian state has given Belarus Re an exclusive position
as the national monopoly reinsurer. The aim is to promote the use
of national reinsurance and raise the capacity of the local
insurance sector. Although no formal support agreement exists
between the state and the company, there is a history of state
support through significant capital injections at the latter's
inception and in recent years.

Regulation obliges local primary insurers to cede risks exceeding
the permitted net retention of 20% of their equity. These
obligatory cessions must be offered to Belarus Re first, and the
reinsurer has the right to reject the cessions. In practice,
Belarus Re often influences primary underwriting of large risks.
Belarus Re's monopoly was introduced gradually with its share in
compulsory cessions reaching 100% in 2014.

Fitch views the credit quality of Belarus Re's investment
portfolio as low. This reflects the credit quality of locally
available investment instruments, constrained by sovereign risks,
and the presence of significant concentrations by issuer. As with
all state-owned companies, Belarus Re's investments are
restricted to deposits and securities of only state-owned banks
and enterprises.

In 2015, Belarus Re's IFRS shareholders' funds fell 30% to BYN126
million, due to changes in accounting treatment of government
bonds. Due to concerns around the liquidity of the government
bond market they were reclassified as a held-to-maturity
portfolio rather than being marked to market, with an associated
loss of BYN55m. The reinsurer's regulatory solvency margin was
not impacted due to its local GAAP basis and remained robust with
a solvency I-like statutory ratio of 20x at end-9M16.

Insurance of domestic financial risks is the largest line in
Belarus Re's portfolio, accounting for 47% of net written
premiums in 2015. This includes various kinds of credit default
insurance for loans and bonds issued by Belarusian banks as well
as reinsurance of export credit risks. This line of business has
been a major contributor to the reinsurer's net technical result.

Belarus Re demonstrated volatile operating results between 2009
and 2015, due to the net monetary loss resulting from
hyperinflation over 2011-2014. Since 2015, Belarus has ceased to
be treated as a hyperinflationary economy. In 2015, the company
reported an exceptionally strong net profit of BYN16 million,
underpinned by an improved underwriting result of BYN11 million
and by one-off FX gains on investments of BYN15 million, due to a
devaluation of the Belarus rouble. Based on local GAAP Belarus
Re's net income at 9M16 was BYN6 million, with investment income
of BYN5 million and FX gains of BYN11m offsetting a negative
underwriting result of BYN8 million. The Fitch-calculated
combined ratio was 132% at end-9M16, due to a strengthening of
the claims case reserve established for property insurance.

Belarus Re has demonstrated strong underwriting results over
2011-2015, with a five-year average loss ratio of 45%. Favourable
claims experience and conservative pricing in most lines of
business have been the key factors behind these strong results.
The obligatory inward cessions and high bargaining power
underpinned by legislation have helped Belarus Re to generate
underwriting profit.

RATING SENSITIVITIES

A change in Fitch's view of the financial condition of the
Republic of Belarus would likely have a direct impact on Belarus
Re's rating.

A significant change to the reinsurer's relations with the
government would also likely have a direct impact on the rating.



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G E R M A N Y
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HSH NORDBANK: Moody's Affirms B2 Subordinated Debt Ratings
----------------------------------------------------------
Moody's Investors Service has affirmed HSH Nordbank AG's
Baa3/Prime-3 issuer and deposit ratings, and its Baa3 senior
unsecured debt and senior-senior unsecured debt ratings. The
outlooks on the long-term issuer rating and the long-term ratings
of all three liability classes remain developing. Concurrently,
Moody's affirmed HSH's B2 subordinated debt ratings and the
Baa3(cr)/Prime-3(cr) Counterparty Risk Assessments.

The rating action was prompted by near-term prospects of
subordinated debt maturities, as substantial amounts of HSH's
dated subordinated debt are scheduled to fall due in February
2017. While these maturities will change HSH's liability
structure
-- with adverse effects on the result of Moody's Advanced Loss
Given Failure (LGF) analysis for senior unsecured debt -- Moody's
said that the affirmation of the Baa3 senior debt rating and its
developing outlook continues to signal its expectations of
material changes to HSH's business profile, risk position and
liability structure in the course of the bank's targeted
privatisation in 2017 or early 2018. Such developments have the
potential to offset the stated adverse effects on HSH's senior
debt ratings.

The rating action further mirrors Moody's affirmation of HSH's b3
standalone baseline credit assessment (BCA) and its b1 adjusted
BCA. The latter incorporates unchanged assumptions for support
from Sparkassen-Finanzgruppe (corporate family rating Aa2 stable,
BCA a2).

HSH and its public sector owners are currently preparing for the
bank's privatisation, which is required to be achieved by the end
of February 2018, according to a state aid ruling of the European
Commission. Moody's understands that, as part of this process,
HSH prepares for a sale of the bank whereby the so-called Core
Bank,
-- which it has already separated from higher-risk legacy assets
that form part of HSH's Restructuring Unit -- may be separately
sold as an option to investors. Moody's therefore expects
developments over the next 12 to 18 months that will affect not
just one, but several key inputs for HSH's senior unsecured debt,
senior-senior debt and deposit ratings, which are not fully
predictable at this juncture. This continues to be illustrated by
the developing outlooks on these ratings.

In addition, Moody's has reclassified as senior -- senior
unsecured two bonds, DE000HSH4048 and DE000HSH40F2, previously
classified as senior unsecured, and affirmed their ratings at
Baa3, with a developing outlook. These two bonds were mistakenly
not identified as qualifying for the senior-senior rating
category in Moody's 21 November 2016 rating action, when the
senior-senior debt class was introduced.

RATINGS RATIONALE

AFFIRMATION OF THE DEBT AND DEPOSIT RATINGS

Moody's decision to affirm HSH's long-term ratings mirrors the
affirmation of the b3 BCA and b1 adjusted BCA; the latter
reflects unchanged assumptions regarding support from Sparkassen-
Finanzgruppe. The ratings also include three notches of rating
uplift from Moody's Advanced LGF analysis, and one notch
government support.

Specifically, the affirmation of the Baa3 senior unsecured debt
rating and its developing outlook reflects a combination of: (1)
potentially offsetting elements under the future capital and
liability structure impacting Moody's Advanced LGF assessment for
this liability class; and (2) expectations of material changes to
HSH's business and risk profile in the course of the bank's
targeted privatisation in 2017 or early 2018.

First, the negative implications for senior unsecured bond
holders from EUR0.9 billion in subordinated instruments maturing
in February 2017, and the resulting weakening of buffers for
senior unsecured bond holders in resolution, may be offset by
ongoing changes during the next 12 to 15 months to the bank's
liability profile. Such changes will likely include a steady, if
not accelerated downsizing of its balance sheet, considering that
more than one quarter of HSH's EUR86 billion total exposure
remains subject to unwinding, as per September 2016. Over time,
asset reduction will raise the cushion of subordinated
instruments relative to total assets, more strongly underpinning
the three notches of rating uplift currently included in HSH's
senior unsecured debt ratings.

HSH's subordinated instruments that will remain outstanding after
Q1 2017 have long maturities and include a large amount of Tier 1
hybrid instruments that absorb losses outside resolution pari
passu with capital.

Second, important decisions regarding HSH's future as a going
concern, and potentially major changes to its business profile
and performance outlook, will hinge on a successful sale of the
bank by the end of February 2018, and whether a successful sale
will include the bank's risky legacy portfolios for which an
alternative solution may be found. Moody's therefore expects
developments over the next 12 to 15 months that will affect not
just one, but several key inputs for HSH's senior debt, senior-
senior debt and deposit ratings.

AFFIRMATION OF HSH's b3 BCA

The affirmation of HSH's b3 BCA balances the quality
deterioration during 2016 of HSH's EUR16.5 billion ship finance
exposure (as of September 2016) and elevated market risk from the
strength of the US dollar on the one hand, and still adequate
loss-absorption buffers implied by the bank's capital ratios on
the other hand.

Despite a large EUR5.0 billion offloading of underperforming ship
finance loans last June, HSH's asset quality remains weak,
leaving the bank vulnerable as the shipping crises has been
driving adverse rating migration in the performing book,
requiring rising amounts of capital resources. The additional
capital requirements have so far been accommodated through a
rising utilisation of the bank's EUR10 billion asset guaranty,
which has resulted in a gradual depletion of the remaining
headroom under the guaranty.

At the same time, HSH reported a fully-phased in Common Equity
Tier 1 ratio of 13.0% as of September 2016, which is above the
level of peers in the same BCA category. HSH's loss-absorption
capacity additionally benefitted from EUR0.5 billion regulatory
headroom under the asset guaranty as of September. The capacity
for additional loan loss provisions that can yet be charged
against the guaranty was EUR1.0 billion as of September, which
will shield the bank's income statement over the coming quarters.

HSH has prepared for its privatisation process by adding to its
liquidity reserves, which resulted in a high 176% liquidity
coverage ratio as of September 2016. The EUR5.0 billion
offloading transaction last June has strengthened its funding
profile, and Moody's expects that further asset sales during H1
2017 will mitigate funding risks. To that extent, HSH has
cautiously provided for a potentially challenging year 2017.

Moody's said that HSH's mandatory privatisation by February 2018
implies uncertainty for the positioning of the BCA and therefore
all of HSH's ratings, not least because a successful
privatisation appears challenging in the face of the persistent
crisis in shipping markets. Charter rates and asset prices in
shipping touched new all-time lows during 2016, and there are no
reliable prospects for a sustained recovery during 2017-18.

WHAT COULD MOVE THE RATINGS UP/DOWN

An upgrade of HSH's Baa3/Prime-3 issuer and deposit ratings will
be subject to an upgrade of HSH's b3 BCA and b1 adjusted BCA. A
BCA upgrade would have to be sufficient to more than offset any
adverse effects on these ratings from Moody's Advanced LGF
analysis. This analysis takes into account the severity of loss
faced by the different liability classes in resolution.

An upgrade of the BCA will depend on HSH's achieving a marked
improvement of its asset profile, for instance through the sale
of impaired assets, and a stabilisation of capital metrics,
including parameters of headroom and capital relief provided by
HSH's EUR10 billion asset guaranty. In addition, stronger and
better predictable profits could support a higher BCA.

Downward pressure on HSH's ratings would arise should ongoing
measures prove insufficient to properly stabilise the bank,
and/or if changes in HSH's liability structure result in a
sustained, higher loss-given-failure in resolution and therefore
reduced benefits derived from Moody's Advanced LGF analysis.

Moody's may consider downgrading the BCA if HSH's solvency
metrics erode more strongly than anticipated, if its access to
debt capital markets for long-term unsecured funding is not
sustained, and/or if the targeted privatisation fails and the
bank's unwinding appears to be insufficiently equipped upfront
with capital and funding resources.

LIST OF AFFECTED RATINGS

Issuer: HSH Nordbank AG

Affirmations:

  * LT Issuer Rating (Local and Foreign Currency), Affirmed at
    Baa3 Developing

  * ST Issuer Rating (Local and Foreign Currency), Affirmed at
    P-3

  * Senior Unsecured Debt (Local and Foreign Currency), Affirmed
    at Baa3 Developing

  * Senior Unsecured MTN (Local Currency), Affirmed at (P)Baa3

  * LT Bank Deposits (Local and Foreign Currency), Affirmed at
    Baa3 Developing

  * ST Bank Deposits (Local and Foreign Currency), Affirmed at
    P-3

  * Senior-Senior Unsecured (Local and Foreign Currency),
Affirmed
    at Baa3 Developing

  * Senior-Senior Unsecured MTN (Local Currency), Affirmed at
    (P)Baa3

  * LT Counterparty Risk Assessment, Affirmed at Baa3(cr)

  * ST Counterparty Risk Assessment, Affirmed at P-3(cr)

  * Other Short Term (Local Currency), Affirmed at (P)P-3

  * Subordinated Debt (Local Currency), Affirmed at B2

  * Subordinated MTN (Local Currency), Affirmed at (P)B2

  * Baseline Credit Assessment, Affirmed at b3

  * Adjusted Baseline Credit Assessment, Affirmed at b1

Change of debt class to senior-senior unsecured debt /
Affirmations:

  * ISIN: DE000HSH4048, Affirmed at Baa3 Developing

  * ISIN: DE000HSH40F2, Affirmed at Baa3 Developing

Issuer: HSH Nordbank, New York Branch

Affirmations:

  * LT Bank Deposits (Local Currency), Affirmed at Baa3
Developing

  * Commercial Paper (Local Currency), Affirmed at P-3

  * LT Counterparty Risk Assessment, Affirmed at Baa3(cr)

  * ST Counterparty Risk Assessment, Affirmed at P-3(cr)

Issuer: HSH Nordbank, Luxembourg Branch

Affirmations:

  * Commercial Paper (Foreign Currency), Affirmed at P-3

  * LT Counterparty Risk Assessment, Affirmed at Baa3(cr)

  * ST Counterparty Risk Assessment, Affirmed at P-3(cr)

The outlook for all listed issuers remains developing.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in January 2016.



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G R E E C E
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ALPHA BANK: Fitch Affirms 'CCC+' Mortgage Covered Bonds Rating
--------------------------------------------------------------
Fitch Ratings has upgraded National Bank of Greece S.A.'s (NBG,
RD/RD/f) Programme II mortgage covered bonds and affirmed its
Programme I. Fitch has also affirmed the mortgage covered bond
programmes of Alpha Bank AE (Alpha, RD/RD/f), and Piraeus Bank
S.A. (Piraeus, RD/RD/f). The rating actions follow the
implementation of the agency's revised Covered Bonds Rating
Criteria published on October 26, 2016.

The rating actions are as follows:

  - Alpha's mortgage covered bonds affirmed at 'CCC+'

  - NBG's mortgage covered bonds issued under Programme I
affirmed
    at 'B-'; Outlook Stable

  - NBG's mortgage covered bonds issued under Programme II
    upgraded to 'B-' from 'CCC+'; Stable Outlook assigned

  - Piraeus's mortgage covered bonds affirmed at 'B-'; Outlook
    Stable

Issuer Default Rating (IDR) Uplift
The Greek covered bonds 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 the Greek
programmes as the issuers' Long-Term IDRs are not support-driven
(neither institutional nor by the sovereign). The uplift takes
into account Fitch's assessment on the Greek legal framework, the
presence of an asset monitor, asset eligibility criteria and
minimum legal, contractual and committed levels of
overcollateralisation (OC).

Payment Continuity Uplift (PCU)

Fitch has assigned a PCU of six notches to NBG's soft bullet
programme (Programme I), based on the 12-month principal maturity
extension and the liquidity reserve in place covering at least
three months interest and senior expenses. The agency has
assigned a PCU of eight notches to Alpha's programme and NBG's
Programme II, reflecting the conditional pass-through (CPT)
amortisation as well as the presence of a liquidity reserve
covering at least three months of interest and senior expenses.
Fitch has assigned a PCU of eight notches to the CPT programme of
Piraeus, based on amendments to the programme's documentation
clarifying the timing for the enforcement of the liquidity
reserve for the timely payment of interest.

Fitch has not used the IDR uplift and PCU in the rating analysis.
This is in accordance with Fitch's covered bonds criteria for
programmes of issuers with an IDR of 'RD' and a VR of 'f'.

KEY RATING DRIVERS

In Fitch's view, the probability of default of Alpha's, NBG's and
Piraeus' covered bonds could be associated with a speculative
credit risk. This qualitative assessment is based on the dual
recourse nature of the instrument and on the availability of
liquidity reserves and principal protection mechanisms. It
further takes into account that Greek covered bonds are
performing obligations and that timely payments of interest and
principal have been made since the imposition of capital controls
in 2015. Nonetheless, the maximum achievable rating for the three
programmes is 'B-', which is Greece's Country Ceiling.

The agency also carried out a quantitative assessment of the
level of protection provided by the Greek issuers in the form of
OC and compared it with the cover pools' credit loss in a 'B-'
stress scenario. The 25% contractual OC of NBG Programme I and II
and the 63.14% OC committed by Piraeus offset the respective
stressed credit loss of 6.1%, 10.1% and 8.7%. This is the
rationale for the upgrade of NBG's Programme II to 'B-' from
'CCC+' and the affirmation of the 'B-' rating of NBG Programme I
and Piraeus's programme. The agency has assigned a Stable Outlook
to NBG's Programme II following the upgrade and maintained that
of NBG's Programme I and Piraeus's programme; this is driven by
the stable cover assets composition and the cushion provided by
the committed OC against the 'B-' credit losses.

The minimum legal OC of 5.26% for Alpha's programme is not
sufficient to cover the programme's credit loss of 8.5% in a 'B-'
scenario, exposing the covered bonds to a substantial credit
risk. As such, we have notched down Alpha's programme rating from
the 'B-' maximum achievable rating by one notch to 'CCC+'. This
is the rationale for the affirmation of the 'CCC+' rating of
Alpha's covered bonds. No Rating Outlook is assigned to this
programme.

VARIATION FROM CRITERIA

The Greek covered bond issuers' IDRs and VRs reflect an uncured
payment default on obligations other than the covered bonds. Yet
recourse against the cover pool has not been activated, a
circumstance not explicitly envisaged in Fitch covered bonds
rating criteria. Fitch rates Greek covered bonds based on a
qualitative analysis of the covered bonds payment interruption
risk and a quantitative analysis of the cover pool credit risk.
This represents a variation from Fitch's Covered Bonds Rating
Criteria and the impact of this variation is undetermined. As a
result of this variation, Fitch does not disclose the breakeven
OC for the programmes' ratings.

RATING SENSITIVITIES

Changes in Greece's Country Ceiling may affect the rating of the
covered bond programmes issued by National Bank of Greece S.A.
(NBG programmes I and II) and Piraeus Bank S.A. All else being
equal, the 'CCC+' rating of Alpha Bank A.E,'s programme is not
sensitive to changes in Greece's Country Ceiling.

Once these banks' Viability Ratings and Issuer Default Ratings
(IDRs) are upgraded from 'f' and 'RD' to higher levels,
Fitch will begin applying the IDR uplift and the Payment
Continuity Uplift, although their ratings will still be subject
to the applicable Country Ceiling. The ratings of the covered
bond programmes are also sensitive to changes to the
overcollateralisation and/or asset percentage that the issuers
commit to.


GREECE: Willing to Accept Mutual Compromises with Creditors
-----------------------------------------------------------
ANA-MPA reports that the Greek government is willing to accept
mutual compromises on some issues with the country's creditors to
reach an agreement that would allow the completion of the second
program review on the condition that any deal would not include
the prior legislation of measures, as demanded by the
International Monetary Fund (IMF), a senior government source
told journalists in Berlin on Dec. 17.

The statement came during Prime Minister Alexis Tsipras' second
day of his visit to the German capital where he met with
Chancellor Angela Merkel and other top German officials and
lawmakers, ANA-MPA notes.

According to ANA-MPA, the same official said the measures
demanded by the IMF are "politically unthinkable, socially
destructive and economically irrational".

"Beyond that, we can discuss about a compromise," ANA-MPA quotes
the official as saying, adding that all sides should understand
that the Greek government "will not back down on this issue no
matter how much pressure is exercised".

The source said that as Prime Minister Alexis Tsipras has
repeatedly extolled in the past the responsibility shown by
German Chancellor Angela Merkel on European issue (ex.
migration), the Greek government has reasons to believe that this
time too, Berlin will rise to the occasion and not allow the
blocking of the second program review, ANA-MPA relates.



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I R E L A N D
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ARBOUR CLO: Fitch Affirms 'B-sf' Rating on Class F Notes
--------------------------------------------------------
Fitch Ratings has assigned Arbour CLO D.A.C. refinancing notes
new ratings and affirmed the others, as:

  EUR208.75 mil. Class A-R: 'AAAsf'; Outlook Stable
  EUR26.25 mil. Class B-1-R: 'AAsf'; Outlook Stable
  EUR19.95 mil. Class B-2-R: 'AAsf'; Outlook Stable
  EUR11.25 mil. Class C-1-R: 'A+sf'; Outlook Stable
  EUR 10.75 mil. Class C-2: affirmed at 'A+sf'; Outlook Stable
  EUR 19.75 mil. Class D: affirmed at 'BBB+sf'; Outlook Stable
  EUR 26.675 mil. Class E: affirmed at 'BB+sf'; Outlook Stable
  EUR 12.125 mil. Class F: affirmed at 'B-sf'; Outlook Stable

Arbour CLO D.A.C. is a cash flow collateralized loan obligation.

                        KEY RATING DRIVERS

'B' Category Portfolio Credit Quality

The average credit quality of the portfolio is in the 'B'
category.  The agency has public ratings or credit opinions on
all obligors in the portfolio and the weighted average rating
factor is 30.9.

High Recovery Expectations
At least 90% of the portfolio will comprise senior secured
obligations.  Recovery prospects for these assets are typically
more favorable than for second-lien, unsecured and mezzanine
assets.  Fitch has assigned Recovery Ratings to all the assets in
the portfolio.  The weighted average recovery rating is 72%.

Payment Frequency Switch
The notes pay quarterly, while the portfolio assets can reset to
a semi-annual basis.  The transaction has an interest smoothing
account, but no liquidity facility.  Potential liquidity stress
for the non-deferrable class A, B-1 and B-2 notes - stemming from
a large proportion of assets resetting to a semi-annual basis in
any one quarterly period - is addressed by switching the payment
frequency on the notes to semi-annual in such a scenario.

Partial Interest Rate Hedge
Between 5% and 15% of the portfolio may be invested in fixed-rate
assets, while fixed-rate liabilities account for 10% of total
liabilities.

Limited FX Risk
The transaction is allowed to invest up to 50% of the portfolio
in non-euro-denominated assets, provided these are hedged with
perfect asset swaps within six months of purchase.  Unhedged
non-euro assets must not exceed 2.5% of the portfolio at any
time.

Trading Gain Release
The portfolio manager may designate trading gains as interest
proceeds, providing the portfolio balance remains above the
reinvestment target par balance and the class E par value ratio
remains above the effective date target ratio.

                        TRANSACTION SUMMARY

On Dec. 15, 2016, Arbour CLO issued the class A-R, B-1-R, B-2-R
and C-1-R refinancing notes, and applied the net issuance and
sales proceeds to redeem the existing class A, B-1, B-2 and C-1
notes at par (plus accrued interest).  The portfolio is managed
by Oaktree Capital Management (UK) LLP.

In conjunction with the refinancing, certain provisions of the
transaction documents were amended.  The amendment addresses
Volcker Rule concerns and results in the introduction of voting,
non-voting and non-voting exchangeable notes.

The transaction documents may be amended subject to rating agency
confirmation or noteholder approval.  Where rating agency
confirmation relates to risk factors, Fitch will analyze the
proposed change and may provide a rating action commentary if the
change has a negative impact on the ratings.  Such amendments may
delay the repayment of the notes as long as Fitch's analysis
confirms the expected repayment of principal at the legal final
maturity.

If in the agency's opinion the amendment is risk-neutral from a
rating perspective Fitch may decline to comment.  Noteholders
should be aware that confirmation is considered to be given if
Fitch declines to comment.

                        RATING SENSITIVITIES

As the loss rates for the current portfolios are below those
modeled for the respective stress portfolio, the sensitivities
shown in the new issue reports still apply.


GLG EURO II: Fitch Assigns 'B-(EXP)sf' Rating to Class F Notes
--------------------------------------------------------------
Fitch Ratings has assigned GLG Euro CLO II D.A.C's notes expected
ratings, as:

  EUR207 mil. class A-1 notes due 2030: 'AAA(EXP)sf'; Outlook
   Stable
  EUR10 mil. class A-2 notes due 2030: 'AAA(EXP)sf'; Outlook
   Stable
  EUR43.9 mil. class B notes due 2030: 'AA(EXP)sf'; Outlook
   Stable
  EUR17.7 mil. class C notes due 2030: 'A(EXP)sf'; Outlook Stable
  EUR17.3 mil. class D notes due 2030: 'BBB(EXP)sf'; Outlook
   Stable
  EUR19.2 mil. class E notes due 2030: 'BB(EXP)sf'; Outlook
   Stable
  EUR7.7 mil. class F notes due 2030: 'B-(EXP)sf'; Outlook Stable

The assignment of final ratings is contingent on the receipt of
final documents conforming to information already reviewed.

GLG Euro CLO II D.A.C. is an arbitrage cash flow collateralized
loan obligation.  Net proceeds from the issue of the notes will
be used to purchase a portfolio of EUR350 mil. of mostly European
leveraged loans and bonds.  The portfolio is actively managed by
GLG Partners LP.

                        KEY RATING DRIVERS

'B'/'B-' Portfolio Credit Quality
Fitch expects the average credit quality of obligors to be in the
'B' category.  Fitch has credit opinions or public ratings on 87
of the 88 assets in the identified portfolio.  The weighted
average rating factor (WARF) of the identified portfolio is 32.6,
below the covenanted maximum Fitch WARF of 33.

High Recovery Expectations
At least 90% of the portfolio will comprise senior secured
obligations.  Recovery prospects for these assets are typically
more favorable than for second-lien, unsecured and mezzanine
assets.  Fitch has assigned Recovery Ratings to 87 of the 88
assets in the identified portfolio.  The weighted average
recovery rating (WARR) of the identified portfolio is 68.7%,
above the covenanted minimum Fitch WARR of 66%.

Diversified Asset Portfolio
The transaction contains a covenant that limits the top 10
obligors in the portfolio to 20% of the portfolio balance.  This
ensures that the asset portfolio will not be exposed to excessive
obligor concentration.

Partial Interest Rate Hedge
Between 0% and 10% of the portfolio can be invested in fixed-rate
assets while fixed rate liabilities represent 3.1% of the rated
note balance.  At closing the issuer will enter into interest
rate caps to hedge the transaction against rising interest rates.
The notional of the caps is EUR21.3 mil., representing 6.1% of
the target par amount, and the strike rate is fixed at 4%.  The
caps will expire 6.5 years after the closing date.

Unhedged Non-Euro Assets Exposure
The manager can invest up to 2.5% of the portfolio in unhedged
non-euro assets, which are purchased in the primary market.  Any
unhedged asset in excess of the allowed limits or held for longer
than 180 days will receive a zero balance for the calculation of
the overcollateralisation tests.  Unhedged assets will be held at
50% of their par value amount after settlement and the
transaction may only purchase unhedged assets if the portfolio
notional amount is above the target par.

Hedged Non-Euro Assets Exposure
The transaction is permitted to invest up to 30% of the portfolio
in non-euro assets, provided perfect asset swaps can be entered
into.

Documentation Amendments
The transaction documents may be amended subject to rating agency
confirmation or noteholder approval.  Where rating agency
confirmation relates to risk factors, Fitch will analyze the
proposed change and may provide a rating action commentary if the
change has a negative impact on the ratings.  Such amendments may
delay the repayment of the notes as long as Fitch's analysis
confirms the expected repayment of principal at the legal final
maturity.

If in the agency's opinion the amendment is risk-neutral from a
rating perspective Fitch may decline to comment.  Noteholders
should be aware that the structure considers the confirmation to
be given if Fitch declines to comment.

                       RATING SENSITIVITIES

A 25% increase in the obligor default probability would lead to a
downgrade of up to two notches for the rated notes.  A 25%
reduction in expected recovery rates would lead to a downgrade of
up to two notches for the rated notes.


TAURUS 2015-2: Moody's Affirms B2 Rating on EUR39.786MM F Notes
---------------------------------------------------------------
Moody's Investors Service has affirmed the ratings of six classes
of Notes issued by Taurus 2015-2 DEU Limited.

Moody's rating action is as follows:

Issuer: Taurus 2015-2 DEU Limited

  -- EUR153M A Notes, Affirmed Aaa (sf); previously on Feb 29,
     2016 Affirmed Aaa (sf)

  -- EUR61.2M B Notes, Affirmed Aa2 (sf); previously on Feb 29,
     2016 Affirmed Aa2 (sf)

  -- EUR61.2M C Notes, Affirmed A3 (sf); previously on Feb 29,
     2016 Affirmed A3 (sf)

  -- EUR55.7M D Notes, Affirmed Baa3 (sf); previously on Feb 29,
     2016 Affirmed Baa3 (sf)

  -- EUR74.1M E Notes, Affirmed Ba2 (sf); previously on Feb 29,
     2016 Affirmed Ba2 (sf)

  -- EUR39.786M F Notes, Affirmed B2 (sf); previously on Feb 29,
     2016 Affirmed B2 (sf)

Moody's does not rate the Class X Notes.

RATINGS RATIONALE

The ratings are affirmed because the transaction's performance is
in line with Moody's expectation -- the default probability of
the loan (both during the term and at maturity) as well as
Moody's value assessment of the collateral remain unchanged.

Moody's term default assessment remains unchanged despite the
expected reduction in leased space by Deutsche Lufthansa AG at
its break option in 2017. Deutsche Lufthansa AG leases 17% of the
non-hotel space in the mixed-used property. Moody's assessment
took into consideration that expected coverage levels should
remain within a healthy range as well as the ongoing active asset
management which has resulted in an additional 4% of non-hotel
space being leased up in 2016. Moody's will continue to monitor
the pace of re-letting. Moody's view remains that refinancing
risk is the significant driver of loan performance given the
significant exposure to the largest tenant, KPMG who will have
less than four years remaining on their lease at loan maturity.
Despite the slight amortization over the last year, Moody's
refinance default risk and the Moody's value at refinance remains
unchanged and is EUR532 million.

Moody's views the expected change in sponsor as credit neutral.
Blackstone Real Estate Partners Europe IV announced on
November 8 that it has agreed to acquire the current sponsor
OfficeFirst Immobilien AG. The acquisition will trigger a change
of control and if the Majority Lenders require, then the Loan
Facility Agent can call for a mandatory prepayment.

Moody's affirmation reflects a base expected loss in the range of
0%-10% of the current balance, unchanged since closing. Moody's
derives this loss expectation from the analysis of the default
probability of the securitised loans (both during the term and at
maturity) and its value assessment of the collateral.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was Moody's
Approach to Rating EMEA CMBS Transactions published in November
2016. Please see the Rating Methodology page on www.moodys.com
for a copy of this methodology.

Other factors used in this rating are described in CMBS Europe -
European CMBS: 2016-18 Central Scenarios published in April 2016.

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

Main factors or circumstances that could lead to a downgrade of
the ratings are (i) a decline in the property value backing the
underlying loan, (ii) an increase in default risk assessment
driven by declining loan performance or increase in refinancing
risk or (iii) an increase in the risk to the notes stemming from
transaction counterparty exposure (most notably the account bank,
the liquidity facility provider or borrower hedging
counterparty).

Main factors or circumstances that could lead to an upgrade of
the ratings are (i) an increase in property value backing the
underlying loan or (ii) a decrease in default risk assessment
driven by improving loan performance or decrease in refinancing
risk.

SUMMARY OF MOODY'S LOAN ASSUMPTIONS

Below are Moody's key assumptions for the Squaire loan.

LTV: 79.7%; Total Default probability: Medium; Expected Loss 0%-
10%



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


ITALFINANCE SECURITISATION: Moody's Affirms B1 Cl. D Notes Rating
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on notes
issued by three Italian Small-Ticket Lease transactions and
affirmed the ratings on notes issued by one Italian SME and two
of the three Italian Small-Ticket Lease transactions. The actions
follow the upgrade of Banco Popolare Societa Cooperativa's
Counterparty Risk assessment "CR assessment" to Ba1(cr) from
Ba2(cr). Moody's has affirmed the ratings of four notes in BPL
Mortgages S.r.l. (2014 SME), an Italian SME transaction, and
additionally has upgraded the ratings of nine notes and affirmed
the ratings of two notes in three Italian small ticket lease
transactions (Italfinance Securitisation Vehicle S.r.l (ITA 8),
Italfinance Securitisation Vehicle 2 S.r.l (ITA 9) and
Leasimpresa Finance S.r.l. (LF 2)). The rating upgrades result
primarily from deleveraging of the transactions since their last
rating actions in June 2015, with the upgrade of Banco Popolare
having only a limited effect. The rating affirmations follow the
upgrade of Banca Popolare and its subsidiaries.

All four transactions have exposure to Banco Popolare through its
roles of originator and servicer. Banco Popolare merged with
Banca Italease S.p.A. -- the originator of ITA 8, ITA 9 and
LF 2 -- in March 2015.

Issuer: BPL Mortgages S.r.l. (2014 SME)

-- EUR1077.4M Class A1-2014 Notes, Affirmed A1 (sf); previously
    on Feb 26, 2016 Affirmed A1 (sf)

-- EUR1936M Class A2-2016 Notes, Affirmed A1 (sf); previously on
    Feb 26, 2016 Rating Assigned A1 (sf)

-- EUR269.3M Class B1-2014 Notes, Affirmed Baa1 (sf); previously
    on Feb 26, 2016 Downgraded to Baa1 (sf)

-- EUR1M Class B2-2016 Notes, Affirmed Baa1 (sf); previously on
    Feb 26, 2016 Rating Assigned Baa1 (sf)

Issuer: Italfinance Securitisation Vehicle S.r.l. (ITA 8)

-- EUR959M Class A Notes, Upgraded to Aa2 (sf); previously on
    June 11, 2015 Confirmed at A1 (sf)

-- EUR83M Class B Notes, Upgraded to A1 (sf); previously on
    June 11, 2015 Upgraded to A3 (sf)

-- EUR56M Class C Notes, Upgraded to A3 (sf); previously on
    June 11, 2015 Upgraded to Baa2 (sf)

-- EUR18.5M Class D Notes, Upgraded to A3 (sf); previously on
    June 11, 2015 Upgraded to Baa3 (sf)

Issuer: Italfinance Securitisation Vehicle 2 S.r.l. (ITA 9)

-- EUR1442.4M Class A Notes, Upgraded to A2 (sf); previously on
    June 11, 2015 Confirmed at A3 (sf)

-- EUR125M Class B Notes, Upgraded to Baa3 (sf); previously on
    June 11, 2015 Confirmed at Ba1 (sf)

-- EUR84.3MClass C Notes, Upgraded to Ba2 (sf); previously on
    June 11, 2015 Upgraded to Ba3 (sf)

-- EUR27.9M D Notes, Affirmed at B1 (sf); previously on June 11,
    2015 Upgraded to B1 (sf)

Issuer: Leasimpresa Finance S.r.l. (LF 2)

-- EUR931.5M A Notes, Affirmed at A1 (sf); previously June 11,
    2015 Confirmed at A1 (sf)

-- EUR57.2M B Notes, Upgraded to A1 (sf); previously on June 11,
    2015 Upgraded to A3 (sf);

-- EUR10.3M C Notes, Upgraded to A1 (sf); previously on June 11,
    2015 Upgraded to Baa2 (sf);

RATINGS RATIONALE

The main drivers of the action are (1) deal deleveraging
resulting in an increase in credit enhancement for the affected
notes; and (2) the upgrade of Banco Popolare's CR Assessment by 1
notch to Ba1(cr).

Moody's analysis takes into account collateral performance to
date, borrower concentrations within the collateral pools and
rating sensitivity to modelling assumptions. Particularly in the
cases of the ITA 8 and LF 2 collateral pools, borrower
concentrations are significant; the rating approach for ITA 8
incorporates a stressed default distribution to mitigate the very
high levels of borrower concentrations, whereas for the more-
granular LF 2 transaction, cashflow model ratings were
constrained to reflect the relationship between available credit
enhancement and the most significant collateral pool borrower
concentrations.

Increase in Available Credit Enhancement

For BPL Mortgages S.r.l. (2014 SME), sequential amortization and
non-amortizing reserve funds led to the increase in available
credit enhancement (CE). For instance, the CE for the most senior
tranche affected by the rating action increased to 46.76% from
39.23% since the last rating action in February 2016.

The rated notes in ITA 8, ITA 9 and LF 2 are amortizing on a pro-
rata basis. With non-amortizing reserve funds and the unrated
(equity) tranches currently locked out of principal cashflows,
credit enhancement for the rated notes has been increasing.

For ITA 8, the CE under the Class A, Class B, Class C and Class D
Notes has increased since the last rating action in June 2015 to
63.1% from 43.6%, to 56.4% from 33.3%, to 51.8% from 26.4% and to
50.3% from 24.1% respectively. The increase in CE results from
pro rata amortisation of the rated notes whilst the unrated Class
E remains outstanding at its originally issued amount.

For ITA 9, the CE under the Class A, Class B, Class C and Class D
Notes has increased since the last rating action in June 2015 to
36.7% from 33.6%, to 24.2% from 20.6%, to 15.8% from 11.7% and to
13.0% from 8.8% respectively. The increase in CE results from pro
rata amortisation of the rated notes whilst the unrated Class E
remains outstanding at its originally issued amount .

For LF 2, the CE under the Class A, Class B and Class C Notes has
increased since the last rating action in June 2015 to 46.1% from
34.0%, to 39.1% from 25.5% and to 37.8% from 23.9% respectively.
The increase in CE results from pro rata amortisation of the
rated notes whilst the unrated Class D remains outstanding at its
originally issued amount .

Revision of Key Collateral Assumptions

BPL Mortgages S.r.l. (2014 SME)

As part of the rating action, Moody's reassessed its default
probability and recovery rate assumptions for the portfolio
reflecting the collateral performance to date.

The performance of the transaction has been stable since February
2016 when the deal was restructured. Since the last rating
action, total delinquencies stand at 9.91%, with 90 days plus
arrears currently at 3.29% of current pool balance. Cumulative
defaults currently stand at 2.81% of original pool balance.

As part of the analysis for BPL Mortgages S.r.l. (2014 SME),
Moody's adjusted the recovery rate assumption to a fixed value of
50% from the prior stochastic recovery rate assumption of 55%.
Moody's kept unchanged the current default probability of 20.30%
of the current portfolio balance, as well as the current
portfolio credit enhancement (PCE) of 32.30% which, combined with
the revised key collateral assumptions, results in a marginal
increase of the Coefficient of Variation (CoV) to 54.89% from
52.00%.

Italfinance Securitisation Vehicle S.r.l (ITA 8)

As part of the rating action, Moody's reassessed its default
probability and recovery rate assumptions for the collateral
portfolio, reflecting transaction performance and the very high
levels of borrower concentrations. The Top 50 borrowers make up
over 70% of the remaining performing collateral balance, whilst
the top 20 names represent approximately 47% of the remaining
performing collateral balance. In its analysis of the
transaction, Moody's considered portfolio concentrations by
generating a default probability distribution which included
rating stresses on the largest concentrations and an increase in
correlation assumptions for the largest industry concentrations
within the collateral pool.

ITA 8 has low levels of delinquencies but exhibits some
volatility in its reported delinquency values due to the
concentrated nature of the collateral pool. Total delinquencies
reduced to 0.51% of current pool balance in September 2016 from
3.06% of current pool balance in June 2016, whilst 90 plus days
delinquencies were reported at 0.0% in September 2016.

Moody's assessment of the transaction included a base case run
using a recovery rate of 50% from the prior assumption of 75%
(which reflected the obligation of the Originator to maintain the
collateralization condition by purchasing defaulted loans at a
minimum of 75% of book value) to reflect the underlying long-term
assumed recovery rate on the collateral, as well as stressed
cases and runs exploring the sensitivity of the transaction to
higher recovery rates. The default probability distribution used
in the base model run is consistent with a default probability of
20.89% of current balance, a PCE of 35.74% and a CoV of 77.09%.

For ITA 8, the rating model output was subject to a constraint
due to the presence of the Italian country risk ceiling of Aa2.

Italfinance Securitisation Vehicle 2 S.r.l (ITA 9)

As part of the rating action, Moody's reassessed its default
probability and recovery rate assumptions for the portfolio
reflecting the collateral performance to date.

The performance of the transaction shows some volatility, with
total delinquencies reported at 3.31% in September 2016 from
6.50% in the prior period. Cumulative defaults currently stand at
10.28% of original pool balance and cumulative net defaults show
a declining trend, reducing to 2.72% in October 2016 from 2.74%
in January 2016.

Moody's has adjusted the recovery rate assumption to 50% from the
prior assumption of 75% to reflect recoveries on the collateral
in place of the repurchase obligation of the Originator to
maintain the collateralization condition by purchasing defaulted
collateral for a minimum of 75% of book value. Moody's maintained
the default probability assumption of 14.0% of the current
portfolio balance as well as the PCE of 22.5% which, combined
with the revised key collateral assumptions, results in a
marginal decrease in CoV to 52.93% from 55.10%.

Leasimpresa Finance S.r.l. (LF 2)

As part of the rating action, Moody's reassessed its default
probability and recovery rate assumptions for the portfolio
reflecting the collateral performance to date.

Notwithstanding the small remaining balance, the performance of
the transaction is relatively stable with total delinquencies
reported at 1.00% in September 2016. Cumulative defaults
currently stand at 5.81% of original pool balance and cumulative
net defaults show a declining trend, reducing to 2.72% in
September 2016 from 2.85% in December 2015.

Moody's has adjusted the recovery rate assumption to 50% from the
prior assumption of 75% to reflect recoveries on the collateral
in place of the repurchase obligation of the Originator to
maintain the collateralization condition by purchasing defaulted
collateral for a minimum of 75% of book value. Moody's maintained
the default probability assumption of 10.0% of the current
portfolio balance as well as the PCE of 20.0% which, combined
with the revised key collateral assumptions, results in a
marginal increase in CoV to 64.21% from 62.13%.

For LF 2, the rating model output was subject to a rating
committee constraint at the single "A" rating category to reflect
the relationship between significant concentrations of borrowers
within the collateral pool and the subordination available to
each class of note.

Counterparty Exposure

Banco Popolare acts as the servicer, issuer account bank and
administrative agent in BPL Mortgages S.r.l. (2014 SME). Banco
Popolare is also the servicer in ITA 8, ITA 9 and LF 2 following
its March 2015 merger with Banca Itealease S.p.A. Banco Popolare
Societa Cooperativa's CR assessment was upgraded to Ba1(cr) on 20
October 2016.

Moody's considered how the liquidity available in the
transactions and other mitigants support continuity of note
payments, in case of servicer default, using the CR Assessment as
a reference point for servicer. The upgrade of the CR assessment
of Banco Popolare had a limited impact on the ratings.

The methodology used in BPL Mortgages S.r.l. (2014 SME) was
"Moody's Global Approach to Rating SME Balance Sheet
Securitization" published in October 2015. The methodology used
in Italfinance Securitisation Vehicle S.r.l., Italfinance
Securitisation Vehicle 2 S.r.l. and Leasimpresa Finance S.r.l.
was "Moody's Approach to Rating ABS Backed by Equipment Leases
and Loans" published in December 2015.

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

Factors or circumstances that could lead to an upgrade of the
ratings include (1) performance of the underlying collateral that
is better than Moody's expected, (2) deleveraging of the capital
structure and (3) improvements in the credit quality of the
transaction counterparties and (4) a decrease in sovereign risk.

Factors or circumstances that could lead to a downgrade of the
ratings include (1) an increase in sovereign risk (2) performance
of the underlying collateral that is worse than Moody's expected,
(3) deterioration in the notes' available credit enhancement and
(4) deterioration in the credit quality of the transaction
counterparties.

STRESS SCENARIOS:

To ensure rating stability and to test the sensitivity of the
notes ratings, Moody's modelling included an assessment of
various stress scenarios.

BPL Mortgages S.r.l. (2014 SME) showed rating sensitivity to a
25% stresses in the default probability assumption and a 20%
increase in the PCE assumption. This sensitivity analysis imposed
a constraint on rating upgrades.

For ITA 8, ITA 9 and LF 2, the base case assumptions already
include certain stresses. For example, the originator in all 3
deals has an obligation to repurchase defaulted loans at a
minimum price of 75% such that the collateralisation condition is
maintained, whereas the base case recovery rate of 50% reflects
the assumed "natural" recovery rate of defaulted collateral. As a
general comment, the default probability and PCE assumptions for
the 3 deals include adjustments for the concentrated nature of
the collateral pools.


MONTE DEI PASCHI: Rescue Likely After Parliament OK's Bailout
-------------------------------------------------------------
BBC News reports that the Italian parliament has approved a
government plan for a possible EUR20 billion (GBP16.8 billion)
bailout of the country's banks.

According to BBC, the Italian Treasury will probably have to
rescue Italy's third largest lender, Monte dei Paschi, by the end
of next week.

The rescue fund will be used to prop up other banks as well, BBC
discloses.

Earlier, Monte dei Paschi revealed that it could run out of funds
by next April, using up nearly EUR11 billion (GBP9.2 billion),
BBC notes.

Previously it had said it had the funds to stay afloat for 11
months, BBC states.  It added that by next May, it could burn
through even more -- EUR15 billion (GBP12.6 billion) in total,
BBC relays.

The bank suspended trading in its shares on Dec. 21, when they
fell to their lowest level since the bank's stock market
flotation in 1999, BBC recounts.

After a resumption in trading, they were suspended again in the
afternoon, after reports emerged that the bank's own plan to
raise extra funds was on the verge of falling through, less than
24 hours before its deadline, BBC relays.

The bank has been trying to raise EUR5 billion (GBP4.2 billion)
in fresh capital to stage its own rescue, but so far it has
raised only EUR500 million (GBP420 million), BBC discloses.  If
the bank cannot arrange a successful private sector bailout, the
Italian government will almost certainly step in, BBC says.

Monte dei Paschi failed a European Union stress test in July
because it has billions of euros of risky loans on its books,
made to clients who cannot afford to repay them, BBC recounts.

                      About Monte dei Paschi

Banca Monte dei Paschi di Siena SpA -- http://www.mps.it/-- is
an Italy-based company engaged in the banking sector.  It
provides traditional banking services, asset management and
private banking, including life insurance, pension funds and
investment trusts.  In addition, it offers investment banking,
including project finance, merchant banking and financial
advisory services.  The Company comprises more than 3,000
branches, and a structure of channels of distribution.  Banca
Monte dei Paschi di Siena Group has subsidiaries located
throughout Italy, Europe, America, Asia and North Africa.  It has
numerous subsidiaries, including Mps Sim SpA, MPS Capital
Services Banca per le Imprese SpA, MPS Banca Personale SpA, Banca
Toscana SpA, Monte Paschi Ireland Ltd. and Banca MP Belgio SpA.



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


GALAPAGOS HOLDING: Moody's Lowers Corporate Family Rating to B3
---------------------------------------------------------------
Moody's Investors Service has downgraded the Corporate Family
Rating (CFR) of Galapagos Holding S.A. to B3 from B2 and the
probability of default rating (PDR) to B3-PD from B2-PD.
Additionally, Moody's has downgraded to Caa2, from Caa1 the
rating pertaining to the senior unsecured notes of Galapagos and
to B2, from B1 the rating pertaining to the senior secured notes
issued by Galapagos S.A., a subsidiary of Galapagos. The outlook
for all of the ratings has been changed to stable from negative.

RATINGS RATIONALE

"The downgrade primarily reflects Galapagos' elevated leverage in
conjunction with sustained weakness in the group's major end
markets," says Scott Phillips, a Moody's Vice President -- Senior
Analyst and lead analyst for Galapagos. "The reduction in
financial debt following the sale of DencoHappel is not enough to
offset the expected weakness in earnings in 2017", added
Mr. Phillips.

In November, Galapagos completed a capital markets transaction to
reduce gross debt by EUR191.5 million using the proceeds from the
sale of its air treatment division -- DencoHappel. While the sale
of DencoHappel reduces the size of the Galapagos group and
reduces diversification, the agency viewed the transaction as
positive overall given the pro-forma reduction in leverage of
around 0.5x. Despite this, Moody's anticipates that leverage will
remain modestly outside of its guidance for the previous B2
rating (of 6x or below) because of lower underlying profitability
expectations and the anticipation of some further restructuring
in 2017 which will further weigh upon leverage and cash flow.
Moody's expect leverage for 2017 to be in the 6-6.5x range.

In 2017, the agency anticipates that profitability in the group's
Enexio division (which manufactures dry and wet cooling systems)
will be lower reflecting weaker order intake in 2016. Similarly,
financial performance in Kelvion (the core heat exchanger
components business) is expected to remain weak reflecting the
challenging environment in the oil & gas, chemicals and marine
end markets. On top of this, the rating agency forecasts further
restructuring costs in the period 2017-18 which are mainly
attributable to lower activity levels in Kelvion.

Moody's views Galapagos' liquidity position as weak. The bulk of
the group's cash sources relate to its Revolving Credit Facility
(RCF) where availability stands at EUR 45 million at the end of
Q3 but where headroom against the financial covenant is reducing.
Moody's forecasts the group to generate around EUR 35-40 million
of Funds From Operations (FFO) in 2017-18 albeit Free Cash Flow
(FCF) generation will be minimal.

RATIONALE FOR THE STABLE OUTLOOK

The stable outlook reflects Moody's expectation that underlying
earnings are unlikely to recover in 2017 and that restructuring
costs and higher capital expenditure will weigh further on
profitability and cash flow. It, however, also assumes that 2016
operating performance will have reached a bottom, and will not
deteriorate further with an expectation of at least break-even
free cash flow generation in 2017.

WHAT COULD CHANGE THE RATING -- UP/DOWN

The ratings could be further downgraded if leverage were to
increase above 7x debt / EBITDA or if liquidity was to
deteriorate from current levels. Conversely, Moody's could
consider an upgrade if Galapagos is able to deliver organic
growth that would facilitate a decrease in leverage to below 6x
debt / EBITDA (as adjusted by Moody's) in conjunction with
positive FCF.

The principal methodology used in these ratings was Global
Manufacturing Companies published in July 2014. Please see the
Rating Methodologies page on www.moodys.com for a copy of this
methodology.

Galapagos Holding S.A. is a holding company, based in Luxembourg,
for a group of entities involved in the manufacturing of heat
exchangers for a variety of different industrial applications.
These primarily include the power generation and oil & gas
sectors but also the food & beverages, chemicals and marine
business areas. Galapagos was formed through a de-merger from its
previous parent -- GEA (a German engineering company) in
May 2014 -- and was acquired by Triton Partners, a private equity
group. In 2015, Galapagos achieved revenues (on a pro-forma
basis) of EUR 1.4 billion.


MAUSER HOLDING: Moody's Assigns B3 Corporate Family Rating
----------------------------------------------------------
Moody's Investor Services has assigned a B3 Corporate Family
Rating (CFR) and a B3-PD Probability of Default Rating (PDR) to
Mauser Holding S.a r.l., the top-entity of the restricted group
of Mauser (the company), a leading industrial packaging producer.
Concurrently, Moody's has withdrawn the existing B3 CFR and B3-PD
PDR assigned to Mauser Corporate GmbH. The outlook on the ratings
is stable.

RATINGS RATIONALE

Mauser's B3 CFR reflects its significant exposure to cyclical end
markets, its acquisitive growth strategy and its weak financial
metrics. Additionally, the company has a primarily commoditised
product line, significant exposure to cyclical end markets and
operates in a fragmented and competitive industry. Approximately
40% of business lacks contractual cost pass-through clauses while
for some of those customers with contractual cost pass-thoughs,
the lag can be lengthy at two to three months.

Strengths in Mauser's credit profile include the company's large
scale and high geographic and product diversity relative to most
competitors. The rating is also supported by the company's
exposure to blue chip customers and its much larger market
position than most competitors in the fragmented industry.

The rating could be upgraded if Mauser sustainably improves its
credit metrics within the context of a competitive environment.
Mauser would need to improve adjusted debt to EBITDA to below
6.0x, free cash flow to debt to the mid-single digits, and EBIT
margin to the high single digits. An upgrade would also be
contingent upon the maintenance of good liquidity.

The rating could be downgraded if Mauser fails to improve its
credit metrics and/or financial policies become more aggressive.
Continued debt-funded acquisition activity could also result in a
downgrade. Specifically, the rating could be downgraded if debt
to EBITDA remains above 7.0x and free cash flow to debt remains
below 1%.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was "Packaging
Manufacturers: Metal, Glass, and Plastic Containers" published in
September 2015.

Mauser Group is a worldwide leading producer of industrial
packaging products with over 5,000 employees and consolidated
revenue of over EUR1.5 billion. Mauser is a portfolio company of
Clayton, Dubilier & Rice.



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


NEPTUNO CLO II: Moody's Affirms Ba2 Rating on Class D Notes
-----------------------------------------------------------
Moody's Investors Service has upgraded the rating on the
following notes issued by Neptuno CLO II B.V.:

  -- EUR23M Class C Senior Secured Deferrable Floating Rate Notes
     due 2023, Upgraded to Aa1 (sf); previously on Jun 1, 2016
     Upgraded to Aa3 (sf)

Moody's also affirmed the ratings on the following notes issued
by Neptuno CLO II B.V.:

  -- EUR308.5M (current balance outstanding: EUR 25.9M) Class A
     Senior Secured Floating Rate Notes due 2023, Affirmed Aaa
     (sf); previously on Jun 1, 2016 Affirmed Aaa (sf)

  -- EUR28M Class B Senior Secured Floating Rate Notes due 2023,
     Affirmed Aaa (sf); previously on Jun 1, 2016 Affirmed Aaa
     (sf)

  -- EUR23M Class D Senior Secured Deferrable Floating Rate Notes
     due 2023, Affirmed Ba2 (sf); previously on Jun 1, 2016
     Affirmed Ba2 (sf)

  -- EUR19M (current balance outstanding: EUR 16.58M) Class E
     Senior Secured Deferrable Floating Rate Notes due 2023,
     Affirmed Caa2 (sf); previously on Jun 1, 2016 Affirmed Caa2
     (sf)

Neptuno CLO II B.V., issued in December 2007, is a Collateralised
Loan Obligation ("CLO") backed by a portfolio of mostly senior
secured European loans. The portfolio is managed by Halcyon
Neptuno II Management LLC. This transaction exited its
reinvestment period on 16 January 2013.

RATINGS RATIONALE

The rating action on the Class C notes is primarily a result of
the expected increase in the Class C over-collateralisation (OC)
ratio at the next payment in January 2017 when the principal
balance of EUR34.5 million, as reported in the November 2016
trustee report, will be used to fully redeem Class A notes and
start amortizing Class B notes.

As per the trustee report dated November 2016, the Classes A/B,
C, D and E OC ratios are reported at 213.59%, 149.74%, 115.27%,
115.27% and 98.87%, respectively, compared to 213.3%, 149.5%
115.1% and 98.7% in the August 2016.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. In its base
case, Moody's analysed the underlying collateral pool as having a
performing par of EUR69.47 million, principal proceeds balance of
EUR34.9 million, defaulted par of EUR31.9 million, a weighted
average default probability of 23.10% (consistent with a WARF of
3,627over 3.4 years), a weighted average recovery rate upon
default of 43.09% for a Aaa liability target rating, a diversity
score of 10 and a weighted average spread of 3.62%.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool. Moody's generally applies recovery rates
for CLO securities as published in "Moody's Approach to Rating SF
CDOs". In some cases, alternative recovery assumptions may be
considered based on the specifics of the analysis of the CLO
transaction. In each case, historical and market performance and
a collateral manager's latitude to trade collateral are also
relevant factors. Moody's incorporates these default and recovery
characteristics of the collateral pool into its cash flow model
analysis, subjecting them to stresses as a function of the target
rating of each CLO liability it is analyzing.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in October 2016.

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

In addition to the base-case analysis, Moody's conducted
sensitivity analyses on the key parameters for the rated notes,
for which it assumed lower weighted average recovery rate for the
portfolio. Moody's ran a model in which it reduced the weighted
average recovery rate by 5%; the model generated outputs that
were within two notches of the base-case results for Class C
notes and within one notch of the base-case results for Class D
notes.

This transaction is subject to a high level of macroeconomic
uncertainty, which could negatively affect the ratings on the
note, in light of uncertainty about credit conditions in the
general economy. CLO notes' performance may also be impacted
either positively or negatively by 1) the manager's investment
strategy and behaviour and 2) divergence in the legal
interpretation of CDO documentation by different transactional
parties because of embedded ambiguities.

Additional uncertainty about performance is due to the following:

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

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

3) Around 39% of the collateral pool consists of debt obligations
whose credit quality Moody's has assessed by using credit
estimates. As part of its base case, Moody's has stressed large
concentrations of single obligors bearing a credit estimate as
described in "Updated Approach to the Usage of Credit Estimates
in Rated Transactions", published in October 2009 and available
at http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_120461.

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



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


EKSPORTFINANS ASA: Moody's Assigns Ba2 Baseline Credit Assessment
-----------------------------------------------------------------
Moody's Investors Service has upgraded Eksportfinans ASA's senior
unsecured debt ratings and issuer rating to Baa3 from Ba3 and its
short-term rating to Prime-3 from Not-prime. In addition, the
rating agency has assigned a ba2 baseline credit assessment
(BCA), a ba2 Adjusted BCA, a Baa2(cr) long-term counterparty risk
assessment (CR Assessment) and a Prime-2(cr) short-term CR
Assessment. Moody's also changed the outlook on Eksportfinans'
long-term debt and issuer ratings to positive from stable.

These actions follow a change in Moody's applied methodology for
Eksportfinans to Banks methodology (published in January 2016)
from government-related issuers methodology (GRI, published in
October 2014) and reflect improvements in the firm's credit
fundamentals, in particular capital and liquidity.

Eksportfinans is a Norwegian credit institution that operated
with a government mandate to provide export financing to support
Norwegian exports. However, following the government of Norway's
(Aaa stable) November 2011 decision to transfer the monopoly
mandate to Export Credit Norway (not rated), Eksportfinans has
focused on winding down its existing operations.

RATINGS RATIONALE

The rating action reflects the change of methodology used to
assess Eksportfinans' ratings to Banks from GRI, following the
Norwegian Bank Recovery and Resolution Directive (BRRD) proposal
in October 2016, which included Eksportfinans in the list of
financial institutions covered by the directive.

The application of the Banks methodology has led Moody's to
assign a BCA to Eksportfinans. The assigned ba2 BCA reflects the
rating agency's view on Eksportfinans' intrinsic credit strength,
driven by improved liquidity, solid asset quality and strong
capitalisation, balanced against tail-risks arising as the
company runs off its business.

As part of the Banks methodology, the rating agency also applied
its advanced loss given failure (Advanced LGF) analysis to
Eksportfinans' liability structure. The output of Moody's
Advanced LGF implies that Eksportfinans' long-term senior debt
holders are likely to face very low loss-given-failure, resulting
in two notches of uplift from the assigned BCA. The Advanced LGF
also informs the assigned CR Assessment of Eksportfinans,
positioned three notches above its BCA.

Furthermore, Moody's has changed the outlook on Eksportfinans'
long-term debt and issuer ratings to positive from stable,
reflecting its expectation of reducing tail-risk and increasing
certainty about the company's liquidity and capital position over
the outlook period.

RATIONALE FOR CHANGING THE METHODOLOGY

On Oct. 26, 2016, the Norwegian Ministry of Finance published its
initial proposal for the implementation of the BRRD in Norway.
Based on the proposal, Eksportfinans will be subject to the same
resolution regulations as other credit institutions in Norway,
which the rating agency assesses using the Banks methodology. The
rating action aligns the methodology used to rate Eksportfinans
with other Norwegian and Nordic credit institutions that are
already rated under the Banks methodology.

Previously, the rating agency applied the GRI methodology as its
principal methodology when assessing Eksportfinans' credit
quality, reflecting the part-government ownership and the
Norwegian government's guarantee of a large proportion of loans.
However, in addition to the BRRD proposal, Moody's considers that
the government's economic interest in Eksportfinans has decreased
over time, leading the rating agency to reconsider the
application of the GRI methodology as the principal methodology.

RATIONALE FOR THE ASSIGNED BCA

As part of its Banks methodology, Moody's assigned a ba2 BCA to
Eksportfinans. The BCA measures the stand-alone intrinsic credit
strength of an issuer and incorporates Moody's forward-looking
expectations and other relevant qualitative considerations.

The ba2 assigned BCA, one notch above the previous Ba3 senior
unsecured debt ratings under GRI methodology, is driven by: (1) a
significant improvement in the company's liquidity position in
2016, owing to materially reduced outstanding debt, while the
company has improved its expected future liquidity position (as
of September 30, 2016, Eksportfinans estimated that its end-2017
liquidity will be NOK1.4 billion, a NOK2.5 billion improvement
from its December 2015 estimate); (2) continuing solid asset
quality (problem loans were 2.0% at the end of September 2016,
all of which were guaranteed by the Norwegian government or
private banks); and (3) very high capitalisation. These factors
are balanced against the tail risk arising from elevated
operational risk and key-man risk, as the company runs off its
business, as well as potential funding shortfalls due to asset
and liability mismatches.

RATIONALE FOR THE UPGRADE OF THE SENIOR UNSECURED DEBT RATINGS
AND ISSUER RATING

The upgrade of Eksportfinans' senior unsecured debt ratings and
issuer rating to Baa3 from Ba3 takes into account the assigned
ba2 BCA and Moody's Advanced LGF analysis, which performs an
analysis of the company's liability structure.

Taking account of Eksportfinans' balance sheet structure at end-
September 2016, Moody's Advanced LGF analysis indicates that the
company's senior unsecured debt is likely to face very low loss-
given-failure, owing to the loss absorption provided by the large
volume of senior unsecured debt, meaning that losses will be
shared among a larger investor base in the event of failure. This
results in a Preliminary Rating Assessment (PRA) of Baa3 for
senior unsecured debt, two notches above the BCA.

Following the removal of Eksportfinans' government-supported
export loan monopoly in November 2011, Moody's does not
incorporate any government support in its assessment of the
company. Hence, the senior unsecured debt ratings and issuer
rating of Eksportfinans are in line with the PRA, at Baa3.

RATIONALE FOR COUNTERPARTY RISK ASSESSMENT

CR Assessments are opinions of how counterparty obligations are
likely to be treated if a financial institution fails and relates
to contractual performance obligations (servicing), derivatives
(e.g., swaps), letters of credit, guarantees and liquidity
facilities. Senior obligations represented by the CR Assessment
will more likely be preserved in order to limit contagion,
minimise losses and avoid disruption of critical functions.

Moody's has assigned a CR Assessment of Baa2(cr)/P-2(cr) to
Eksportfinans. The CR Assessment is positioned three notches
above the Adjusted BCA of ba2, based on the cushion against
default provided by more subordinated instruments that protects
the senior operating obligations represented by the CR
Assessment.

RATIONALE FOR THE POSITIVE OUTLOOK

The positive outlook on Eksportfinans' senior ratings reflects
Moody's expectations of reducing tail-risk and increasing
certainty about the company's liquidity and capital position over
the next six to twelve months. The company's debt will continue
to run-off at a high pace, as the company will make a large debt
payment in June 2017 (Moody's calculates over 50% debt reduction
by end-2017). Following the June 2017 debt payment, the rating
agency expect upward pressure on the BCA, as Eksportfinans
further strengthen its funding and liquidity positions, while
capital will remain strong.

WHAT COULD CHANGE THE RATINGS UP/DOWN

Upward rating pressure could develop from a continuation of the
positive trends in Eksportfinans' financial performance,
including: (1) successful large debt repayment in June 2017,
while maintaining positive liquidity buffers; and (2) reduced
uncertainty relating to structured debt repayments.

Downward rating pressure could arise from: (1) deterioration of
the liquidity position beyond what is expected; (2) any renewed
pressure on asset quality, particularly in the company's non-
government guaranteed portfolio; (3) large extraordinary dividend
payments to Eksportfinans' owners that exceeds Moody's
expectations.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks
published in January 2016.

List of Affected/Assigned Ratings:

Upgrades:

-- LT Issuer Rating, Upgraded to Baa3 Positive from Ba3 Stable

-- Senior Unsecured Regular Bond/Debenture, Upgraded to Baa3
    Positive from Ba3 Stable

-- Commercial Paper, Upgraded to P-3 from NP

Assignments:

-- Adjusted Baseline Credit Assessment, Assigned ba2

-- Baseline Credit Assessment, Assigned ba2

-- Counterparty Risk Assessment, Assigned Baa2(cr)

-- Counterparty Risk Assessment, Assigned P-2(cr)

Outlook Actions:

-- Outlook, Changed To Positive From Stable



===========
P O L A N D
===========


ROOF POLAND 2014-DAC: Fitch Affirms BB-sf Rating on Cl. B Notes
---------------------------------------------------------------
Fitch Ratings has affirmed the ratings of Roof Poland Leasing
2014 DAC as:

  PLN636 mil. class A-1 floating-rate secured notes: affirmed at
   'AA-sf'; Outlook Stable
  PLN234.2 mil. class A-2 floating-rate secured notes: affirmed
   at 'AA-sf'; Outlook Stable
  PLN383.5 mil. class B floating-rate secured notes: affirmed at
   'BB-sf'; Outlook Stable

This transaction is a securitisation of lease installments
related to new and used cars, trucks, trailers and machinery
originated in Poland by Raiffeisen Leasing Polska S.A. (RLP).
Originally closed in December 2014, the transaction acquired more
assets and issued further notes in December 2015.  The
transaction is to revolve for one more year.

                       KEY RATING DRIVERS

Stable Portfolio Characteristics
The receivable pool's stratification in client and lease object
segments has not changed materially from the initial analysis of
the restructured transaction in December 2015.  Equally, lessee
exposure concentration is little changed, with the 20 biggest
lessee exposures at 3.6% of portfolio principal.

Fitch views the amortization events as reasonably stringent.  Two
years into the three-year revolving period the residual risk of
receivable repurchases decreasing the triggers' efficiency has
not materialized.  The pool's performance has consistently been
inside Fitch's baseline assumptions, confirming these assumptions
as sufficiently conservative.

Performance in Line with Expectation
RLP is a major company in the Polish leasing market, operating
since 1998.  Fitch has maintained its initial asset assumptions:
a weighted average lifetime default rate of about 4.4% under the
transaction's definition before any adjustment, and 5.7% if early
lease terminations are incorporated.  As of end-September 2016,
defaults amounted to 0.43% of the underlying receivables balance,
and arrears in the 60 to 120dpd bucket stood at 0.19%.

Originator Risk Contained
Fitch's analysis assumes RLP's insolvency.  This assumption
mainly impacts the commingling of funds -- for which Fitch has
assumed a 6% loss -- and the exclusion from assumed recoveries of
asset sale proceeds, which the transaction might not be able to
access after RLP's insolvency.  The risk that the new owner of
RLP, currently for sale, may relax underwriting standards during
the revolving period is in our view addressed by our initial
stressed assumptions.  If the acquisition of RLP by PKO Bank
Polski (PKO BP) is implemented as agreed, the new merged entity
will become Poland's leading leasing provider.  Thus far no
indications have presented themselves for potentially relaxed
underwriting standards.

Sovereign-Related Cap
As per the Criteria for Country Risk in global Structured Finance
and Covered Bonds Polish ABS transactions are currently capped at
'AAsf', ie four notches above the sovereign's Long-Term Local-
Currency Issuer Default Rating (LC IDR).

                        CRITERIA VARIATION

Fitch has made a variation from its Global Consumer ABS Criteria
in interpreting the model results.  Cash flows have not been
remodeled for this review due to the transaction still being in
its revolving period and no significant changes to the portfolio
composition, with healthy and stable asset performance, which is
well above Fitch's original assumptions.  Accordingly Fitch
considers the model result of its initial rating analysis
conducted in December 2015 still valid.  The initial ratings
assigned are one notch higher than the model results indicated in
the initial analysis.  The breakeven default multiple is outside
the criteria's +/- 0.1 tolerance for applied stress multiples.
Fitch has affirmed the ratings, given the stable performance over
the last 12 months.

                        RATING SENSITIVITIES

  Rating sensitivity to increased default rate assumptions
   (class A / class B)
  Current ratings: 'AA-sf' / 'BB-sf'
  Increase in default rate by 10%: 'Asf' / 'B+sf'
  Increase in default rate by 25%: 'A-sf' / 'Bsf'
  Increase in default rate by 50%: 'BBBsf' / below 'Bsf'

  Rating sensitivity to reduced recovery rate assumptions
   (class A / class B)
  Current ratings: 'AA-sf' / 'BB-sf'
  Decrease in recovery rate by 10%: 'A+sf' / 'B+sf'
  Decrease in recovery rate by 25%: 'A+sf' / 'B+sf'
  Decrease in recovery rate by 50%: 'A+sf' / 'B+sf'

  Rating sensitivity to multiple factors (class A / class B)
   Current ratings: 'AA-( sf' / 'BB-sf'
  Increase in default rate by 10%, decrease in recovery rate by
   10%: 'Asf' / 'B+sf'
  Increase in default rate by 25%, decrease in recovery rate by
   25%: 'BBB+sf' / 'Bsf'
  Increase in default rate by 50%, decrease in recovery rate by
   50%: 'BBB-sf' / below 'Bsf'

Sovereign-Related Cap

A further downgrade of Poland's Long-Term LC IDR below the
current 'A-' could lead to a review of the notes' rating.


TAURON POLSKA: Fitch Rates EUR190-Mil. Hybrid Bonds 'BB+'
---------------------------------------------------------
Fitch Ratings has assigned Tauron Polska Energia S.A.'s
EUR190 mil. (PLN843 mil.) hybrid bonds due in 2034 a final rating
of 'BB+'.  The securities qualify for 50% equity credit.

The hybrid bonds are to be subscribed by European Investment Bank
(EIB).  The proceeds will be used to co-finance capex in
distribution.  The bonds' rating and assignment of equity credit
are based on Fitch's hybrid methodology, dated Feb. 29, 2016.

                       KEY RATING DRIVERS

KEY RATING DRIVERS OF THE BONDS

Ratings Reflect Deep Subordination
The notes are rated two notches below Tauron's Long-Term Issuer
Default Rating (IDR; BBB/Stable) given their deep subordination
and consequently, the lower recovery prospects in a liquidation
or bankruptcy scenario relative to the senior obligations.  The
notes are subordinated to all senior debt.

Support to the Capital Structure
Fitch expects Tauron's credit metrics to improve once the large-
scale capital projects that are underway start contributing
earnings and annual capex normalizes over the long term.  If the
group's financial profile has improved by the first call date of
the hybrid in 2024, management may decide to refinance the hybrid
with senior unsecured debt.  If the group's leverage is close to
the net debt/EBITDA covenant of 3.5x, which is included in some
long-term funding agreements, management is expected to replace
the hybrid with a similar instrument.  Both scenarios are
compatible with Fitch's interpretation of permanence.  The
important aspect is that the hybrid capital will support the
capital structure in a stress case.

The EUR190 mil. hybrid bonds with 50% equity credit for eight
years, which is a comparatively short period, marginally improve
Tauron's funds from operations (FFO) adjusted net leverage by
about 0.1x.  While this is not critical for the company's IDR,
the hybrids would be excluded from Tauron's net debt in the
covenant calculation, which is supportive also when considering
permanence.

Equity Treatment Given Equity-Like Features
The securities qualify for 50% equity credit as they meet Fitch's
criteria with regards to deep subordination, remaining effective
maturity of at least five years, full discretion to defer coupons
for at least five years and limited events of default.  These are
key equity-like characteristics, affording Tauron greater
financial flexibility.  Equity credit is limited to 50% given the
cumulative interest coupon, a feature considered more debt-like
in nature.

Effective Maturity Date
The notes are due 18 years from the issue date.  The coupon step-
up of 90bps from the first call date in 2024 is within Fitch's
aggregate threshold rate of 100bps.  However, the second coupon
step-up of 11bps from 2029 leads to aggregated step-up of 101bps,
which is above Fitch's threshold.  As a result, 2029 is the
effective maturity according to Fitch's hybrid criteria.  The
equity credit of 50% would change to 0% five years before the
effective maturity date.  The issuer has the option to redeem the
notes on the first call date eight years from the issue date and
on any coupon payment date thereafter.

Fitch is aware that contractual arrangements between EIB and
Tauron include the possibility for an incentive-based
contribution towards the capital project related to the Juncker
plan, if Tauron complies with its obligations under the project
agreement with EIB.  These include carrying out the project in
accordance with the technical description and within a specified
final date, implementation and operation of the project in
compliance with EU and Polish environmental legislation and
meeting few corporate governance requirements specified in the
project agreement.

Cumulative Coupon Limits Equity Treatment
The interest coupon deferrals are cumulative, which results in
50% equity treatment and 50% debt treatment of the hybrid notes
by Fitch.  Despite the 50% equity treatment, Fitch treats coupon
payments as 100% interest.  The company will be obliged to make a
mandatory settlement of deferred interest payments under certain
circumstances, including the payment of a dividend.

                    KEY RATING DRIVERS FOR TAURON

High Share of Regulated Business
The ratings reflect the high share of regulated and fairly stable
distribution business in Tauron's EBITDA (67% in 2015).  This
contributes to cash flow predictability at a time when
conventional power generation, another key segment, is under
pressure due to a challenging operating environment and limited
fuel mix diversification with a high reliance on coal.

Fitch expects the share of distribution to remain around 65% in
2016-2018, but it may slightly decrease in 2019 when the Jaworzno
III 910 MW coal-fired power plant comes on stream to boost the
performance of the weak generation segment.

Despite allocating fairly high capex for conventional power
generation by 2020, distribution continues to dominate Tauron's
capex plan (53% of 2016-2020 capex), followed by generation (37%)
and coal mining (7%).

Strategy Drives Slower Leverage Increase
One of the key elements of Tauron's strategy update in September
2016 is the support of the financial profile through capex
reduction by 11% to about PLN18bn for 2016-2020 (including the
cancellation of the PLN1.5 bil. gas-fired power plant project in
Lagisza), cost reductions and asset optimisation.

A key objective is to maintain leverage below the net debt/EBITDA
covenant of 3.5x.  Management said that the forecasts prepared
for the strategy update indicate that no dividends will be paid
until 2019.  In June the shareholders agreed to no dividend
payments in 2016, compared with a PLN263m dividend paid in 2015.

Fitch views the capex programme as still significant despite the
planned reduction in the strategy update.  Fitch projects FFO
adjusted net leverage to increase to about 3.4x in 2016-2018 from
2.4x in 2015, close to the maximum 3.5x for the ratings.  As a
result, Tauron has limited room for underperformance or
additional capex or acquisitions.

Financial Flexibility
In Fitch's view, Tauron retains some flexibility to reduce capex
or implement other measures should cash flows be below
expectations. For instance, it will consider selling to an
external investor up to a 50% stake in the Jaworzno III project.
Capex in the distribution segment could also be deferred.

Rated on a Standalone Basis

Tauron is 30.06% owned and effectively controlled by the Polish
state (A-/Stable).  However, Fitch rates it on a standalone basis
because Fitch assess legal, operational and strategic links with
the state as moderate based on our Parent and Subsidiary Rating
Linkage criteria.  In Fitch's view, the links have had an
incrementally stronger impact on the company under the new
government since November 2015.  Examples include the plan for no
dividends until 2019.

In Fitch's view, the Polish government's plans to introduce a
capacity market are crucial in allowing new coal power plants
under construction, such as the Jaworzno III plant, to be
profitable in the long term.  Fitch currently does not include
any cash inflows related to the contemplated capacity market in
our rating case forecast until 2020.

                         DERIVATION SUMMARY

Tauron's and Energa S.A.'s (BBB/Stable) business profiles benefit
from the large share of regulated distribution in EBITDA, which
provides good cash flow visibility at times when another key
segment, conventional power generation, is under pressure.  Two
other Polish utilities, PGE Polska Grupa Energetyczna S.A.
(BBB+/Stable), and ENEA S.A. (BBB/Stable) have lower share of
regulated distribution than Tauron and Energa.

Tauron, Energa and ENEA have limited headroom under their
negative rating guidelines due to a projected increase in
leverage in 2017-2018 driven by large capex.

                           KEY ASSUMPTIONS

Fitch's key assumptions within its rating case for the issuer
include:

   -- Weighted average cost of capital in the distribution
      segment reduced to 5.7% in 2016 from 7.2% in 2015 (and 6.8%
      when applying the one-off haircut applied by the
      regulator), before gradually increasing to 6% in 2020.

   -- 5% haircut reducing return on the distribution's regulated
      asset base incorporated from 2018.

   -- Wholesale baseload power prices falling to about PLN155 per
      MWh by 2020.

   -- Commencement of Jaworzno hard coal power block (0.9GW) and
      Stalowa Wola CCGT (50% of 0.4GW) in 2019-2020.

    -- Capex of PLN18 bil. for 2016-2020.

   -- No dividends until 2019.

   -- Tauron's PLN314.5 mil. guarantee for the Stalowa Wola gas-
      fired power plant JV included in Fitch-adjusted debt
      calculation.

                        RATING SENSITIVITIES

Positive: Rating upside for Tauron is limited due to the
company's business profile and projected increase in leverage due
to capex. However, future developments that could lead to
positive rating actions include:

   -- Continued focus on the distribution business in capex and
      overall strategy, together with FFO adjusted net leverage
      below 2.5x on a sustained basis, supported by management's
      more conservative leverage target.

   -- A more diversified fuel generation mix and lower CO2
      emissions per MWh, which together with continued efficiency
      improvements, would result in a stronger business profile.

Negative: Future developments that could lead to negative rating
action include:

   -- FFO adjusted net leverage above 3.5x and FFO fixed charge
      cover below 5x (2015: 11x) on a sustained basis -- for
      example, due to full implementation of capex and weaker
      than expected operating cash flows.

   -- Acquisitions of stakes in coal mines or other form of
      support for state-owned mining companies under financial
      pressure leading to net leverage above 3.5x or
      substantially worsening Tauron's business profile.

   -- Failure to maintain adequate liquidity.

   -- A substantial tax payment arising from an increase in the
      nominal value of Tauron's shares.  This is a cash flow and
      operating environment risk for Tauron and other Polish
      state-controlled utilities as the government contemplates
      an increase of the nominal value of their shares.  Such an
      increase would be subject to approval at the shareholders
      meeting.  This tax payment is not included in Fitch's
      assumptions for the rating case.  Fitch treats this as
      event risk and a potential corporate governance issue.

                              LIQUIDITY

Sufficient liquidity: Tauron has improved its medium-term
liquidity in the past 12 months after having signed a new
PLN6.3 bil. long-term bond issue programme underwritten by banks
in November 2015 and refinanced PLN2.3 bil. bonds in 1Q16 ahead
of maturity in December 2016.  At end-September 2016 Tauron had
PLN75 mil. of readily available cash and PLN4.5 bil. of committed
funding against short-term debt of PLN1.1 bil. and Fitch-expected
negative free cash flow for 2017 of PLN1.4 bil.

                       FULL LIST OF RATINGS

Fitch currently rates Tauron as:

   -- Long-Term Foreign and Local Currency IDRs 'BBB'; Outlook
      Stable;
   -- Short-Term Foreign and Local Currency IDRs 'F3';
   -- National Long-Term Rating 'A+(pol)'; Outlook Stable;
   -- National senior unsecured rating 'A+(pol)'.

Fitch has assigned this rating:

   -- Hybrid bonds 'BB+'.



===============
P O R T U G A L
===============


BANCO ESPIRITO: 4,000 Retail Customers to Recover 60% of Claims
---------------------------------------------------------------
Sergio Goncalves and Andrei Khalip at Reuters report that around
4,000 retail customers of Banco Espirito Santo who lost their
savings when the banking group collapsed in 2014 should get
around 60% of their money back under a plan presented on Dec. 19
by the Portuguese government.

The retail investors have protested and taken legal action to try
to get compensation for their losses since the government stepped
in to rescue Banco Espirito Santo, Reuters relates.  This
included an injection of EUR4.9 billion (US$5.12 billion) into
the healthy part of the bank now known as Novo Banco, Reuters
notes.

The government's plan should remove one of the litigation risks
that has complicated efforts to sell Novo Banco, Reuters states.

Prime Minister Antonio Costa, as cited by Reuters, said the
proposed solution would not weigh on the taxpayer.

He also said the plan should reinforce confidence in the
Portuguese financial system, which is still reeling from the
rescue of BES in 2014 and smaller bank Banif last year, Reuters
relays.

According to Reuters, under the plan, retail customers will
receive EUR286 million over the next three years out of the
EUR485 million they invested in the commercial paper of the now
bankrupt holding companies linked to Banco Espirito Santo's
founding family.  The money for the compensation will come from
Portugal's bank resolution fund, Reuters says.

Retail clients who invested up to EUR500,000 will recover up to
75% of their investments and those who put more will get up to
50%, Reuters discloses.

They have to sign up to the plan by giving up their claims
already filed with various courts, Reuters states.  A new entity
will be set up to handle all claims and pay out compensation,
Reuters notes.

                   About Banco Espirito Santo

Banco Espirito Santo is a private Portuguese bank based in
Lisbon, Portugal.  It is 20% owned by Espirito Santo Financial
Group.



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


RUSSIAN HELICOPTERS: Moody's Hikes Corporate Family Rating to Ba2
-----------------------------------------------------------------
Moody's Investors Service has upgraded to Ba2 from Ba3 the
corporate family rating (CFR) and to Ba2-PD from Ba3-PD the
probability of default rating (PDR) of Russian Helicopters JSC
(RH), a government-owned sole Russian designer and manufacturer
of helicopters. The outlook on the ratings is stable. At the same
time, Moody's raised the company's baseline credit assessment
(BCA), which is a measure of the company's standalone credit
quality, to b1 from b2.

"Our decision to upgrade the rating on Russian Helicopters
factors in its improved standalone financial strength and Moody's
expectations that it will maintain its financial metrics on the
back of its relatively low costs, ongoing repayment of
government-related debt obligations, and a solid backlog of state
and export contracts," says Ekaterina Botvinova, a Moody's Senior
Analyst.

RATINGS RATIONALE

The ratings upgrade for RH, which is a government-related issuer
(GRI) under Moody's GRI methodology, results from the improvement
in RH's standalone creditworthiness, which is reflected by the
company's raised BCA. Under this methodology, RH's ratings
continue to factor in a two-notch uplift to the b1 BCA, given
Moody's assumption of the strong probability of state support to
the company in the event of financial distress.

The higher BCA factors in RH's deleveraging in the last 12 months
owing to positive free cash flow generation, on the back of high
export margins helped by the rouble depreciation, and maturing
government-related debt obligations. RH's adjusted leverage
measured as debt/EBITDA decreased to 2.7x as of end-June 2016
from 3.5x in 2015 and peak levels of 8.3x in 2012-13. Moody's
anticipates that state-guaranteed loans issued to the company
will be repaid as planned and RH's adjusted leverage will sustain
below 4x.

RH's cash generation capacity benefits from the company's leading
and stable market positions both internationally and
domestically, based on the company's offerings in the medium
segment (Mi-8/17) and attack segment (Mi-24/35, Mi-28, Ka-52).
RH's revenue has been growing at CAGR of 22% in the past four
years due to the advanced deliveries of helicopters for a large
contract with Ministry of Defence (MoD) and stable export sales.
In 2015 deliveries stabilized at 212 units and Moody's expects
the company to retain its volume of sales around this level in
the next 3-5 years. Investments in the new model range,
increasing operating efficiencies and a significant rouble
depreciation in 2014-15 have resulted in profitability growth
measured by adjusted EBITDA margin to 27.4% in 2015 from 15.7% in
2011.

Moody's expects a limited deterioration in RH's margins over the
next 12-18 months, with higher-margin sizable export contracts
likely to compensate various pressures from the weak domestic
environment, including cost inflation and potential pricing
pressure from the MoD.

At the same time, RH's BCA remains constrained by (1) the risk of
cash flow volatilities in Russia's weak domestic environment,
given significant customer concentration, with a bulk of sales
volumes represented by state orders; and (2) increased global
political pressures.

RATIONALE FOR THE STABLE OUTLOOK

The stable outlook reflects Moody's view that the company's
standalone creditworthiness is solidly positioned and has a
potential for growth, which mitigates pressures from Russia's
challenging operating and sovereign environment.

WHAT COULD CHANGE THE RATING DOWN/UP

Positive pressure is currently unlikely, given RH's close linkage
with the Russian government, which currently has a negative
outlook on its Ba1 rating.

The company's rating could be downgraded if (1) there is a
downgrade of Russia's sovereign rating and/or a lowering of the
foreign-currency bond country ceiling; (2) Moody's revises
downwards the assessment of the probability of the Russian
government providing extraordinary support to RH in the event of
financial distress; or (3) RH's leverage increases sustainably
above 4x and/or its liquidity were to weaken.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Global
Aerospace and Defense Industry published in April 2014. Other
methodologies used include the Government-Related Issuers
methodology published in October 2014.

Russian Helicopters JSC is the sole Russian designer and
manufacturer of helicopters and one of the few companies
worldwide with the capability to design, manufacture, service and
test modern civilian and military helicopters. In the last twelve
months to June 2016, RH generated revenues of RUB219 billion
($3.3 billion) and adjusted EBITDA of RUB56.6 billion ($846
million).


TATFONDBANK PJSC: 3-Month Moratorium on Satisfying Claims Imposed
-----------------------------------------------------------------
Guided by Article 18938 of the Federal Law "On Insolvency
(Bankruptcy)", the Bank of Russia has imposed a three-month
moratorium on satisfying claims of creditors of Public Joint-
stock Company Tatfondbank from December 15, 2016 due to the
bank's failure to satisfy creditors' monetary claims within the
timeframe exceeding seven days from the deadline, according to
the press service of the Central Bank of Russia.

In accordance with the Federal Law "On Insurance of Household
Deposits with Russian Banks", the imposition of a moratorium on
satisfying bank creditors' claims is an insured event.  The
payment of indemnities to PJSC Tatfondbank depositors, including
individual entrepreneurs, will start no later than 14 days after
the imposition of the moratorium.  The state corporation Deposit
Insurance Agency will determine the procedure for paying
indemnities.

The Bank of Russia has also appointed the state corporation
Deposit Insurance Agency as a provisional administrator for six
months from December 15, 2016, due to the unstable financial
position of PJSC Tatfondbank and threats to the interests of its
creditors and depositors.

The rights of shareholders related to their stakes in the
authorized capital as well as the authority of management of PJSC
Tatfondbank have been suspended for a period of the provisional
administration activity.

The priority task of the provisional administration is to inspect
the bank's financial position.


VNESHPROMBANK: Files RUR1-Bil. Claim Against Former President
-------------------------------------------------------------
RAPSI, citing court records, reports that Vneshprombank, a major
mid-sized bank that slid into bankruptcy, filed a claim to the
Moscow Commercial Court seeking RUR1 billion (US$16.2 million)
from its former president Larisa Markus.

A criminal case was opened against Ms. Markus who is suspected of
fraud, RAPSI discloses.  She was arrested in December 2015, RAPSI
recounts.

According to RAPSI, investigators claim that Ms. Markus along
with alleged accomplices created in 2013 an organized crime group
to siphon RUR932.1 million (US$14.3 million) from the bank.  The
group allegedly granted loans to sub-companies and did not refund
money to Vneshprombank, RAPSI notes.

Vneshprombank was one of the top 40 by assets before it lost its
licence in January, RAPSI states.

On December 18, 2015, the Central Bank appointed a temporary
administration in the bank for six months to appraise its
financial performance, RAPSI relates.  It was revealed that
massive transactions had been conducted to transfer assets out of
the bank, RAPSI relays.

In March, the Moscow Commercial Court declared Vneshprombank
bankrupt, RAPSI recounts.



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


CHPP PJSC: Declared Bankrupt by Odesa Court, Owes UAH710 Million
----------------------------------------------------------------
Interfax-Ukraine reports that the business court in Odesa region
has declared public joint-stock company Odesa combined heat and
power plant (CHPP) bankrupt and launched a liquidation procedure
for the period of 12 months.

According to Interfax-Ukraine, the company reported in the
information disclosure system of the National Commission for
Securities and the Stock Market on Dec. 20 that the court made
the decision on Dec. 13.

Readjustment manager Yevhen Lakhnenko filed an application to
close the company, Interfax-Ukraine relates.

As of December 31, 2015, net asset value was UAH328.781 million
and liabilities stood at UAH710.323 million, Interfax-Ukraine
discloses.

"It is not enough assets of Odesa CHPP to pay for its
liabilities.  After satisfying claims of creditors there will not
be a sum to distribute among the company's shareholders,"
Interfax-Ukraine quotes the company as saying.


FINANCIAL INITIATIVE: Bankruptcy Ruling Valid, Appeals Court Says
-----------------------------------------------------------------
Interfax-Ukraine reports that Kyiv's court of appeals has
satisfied a counterclaim of the National Bank of Ukraine (NBU)
against a ruling of the court of a lower instance that declared
invalid the regulator's resolution placing bank Financial
Initiative to the list of insolvent banks.

NBU Governor Valeriya Gontareva presented the interests of the
NBU in court, Interfax-Ukraine relates.  She informed the judges
that the bank lost liquidity and equity capital, Interfax-Ukraine
discloses.  The bank violated Ukrainian law related to cash
turnover and did not implement its liabilities to creditors, in
particular, the NBU on refinancing loans, Interfax-Ukraine
relays.

According to Interfax-Ukraine, she said that the country does not
have legislation permitting to resume operators of the banks that
have been declared insolvent.

On October 5, 2016, Kyiv's district administrative court
satisfied the claim of Invest-Service LLC, the full owner of the
bank, Interfax-Ukraine recounts.

The National Bank on June 23, 2015 declared Bank Financial
Initiative insolvent, Interfax-Ukraine discloses.  The fund
introduced temporary administration in the bank on June 24,
Interfax-Ukraine relates.

The Kyiv Economic Court on October 15, 2015 in response to a
claim of the potential buyer of insolvent Bank Financial
Initiative, Perusta Constructions, banned the Individuals'
Deposit Guarantee Fund from submitting proposals to the National
Bank, making decisions on the liquidation of the financial
institution and revoking its banking license, Interfax-Ukraine
notes.

Bank Financial Initiative was established in 2005.



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


GHA COACHES: Welsh Gov't Provides Grant Following Administration
----------------------------------------------------------------
BBC News reports that bus services in north east Wales hit by the
collapse of a coach firm will be boosted by a grant of GBP300,000
from the Welsh Government.

GHA Coaches went into administration in July with the loss of 320
jobs after it failed to pay a tax bill, BBC recounts.

According to BBC, the money will allow Denbighshire, Flintshire
and Wrexham councils to restore and support lost services.

Economy Secretary Ken Skates said the cash would provide "network
stability", with a bus summit planned for January, BBC relates.

GHA Coaches is a Wrexham bus company.


INTERNATIONAL PERSONAL: Fitch Puts 'BB+' IDR on Rating Watch Neg.
-----------------------------------------------------------------
Fitch Ratings has placed International Personal Finance Plc's
(IPF) Long-Term Issuer Default Rating and senior debt ratings of
'BB+' on Rating Watch Negative (RWN).  IPF's Short-Term IDR has
been affirmed at 'B'.

The RWN follows proposed revisions to consumer credit legislation
in Poland.  On Dec. 9, the Polish Ministry of Justice initiated a
14-day consultation period for a draft bill limiting non-interest
costs that can be charged for unsecured consumer loans

IPF is a UK-domiciled finance company that specialises in
providing unsecured consumer credit to customers with below-
average income.

                         KEY RATING DRIVERS

The proposed revisions follow a similar measure that became
effective in March this year, which consisted of a flat cap of
25% of the loan value and an additional cap of 30% per annum.
Under the new proposal, the flat cap would be reduced to 10% of
the loan value and the additional cap per annum would be reduced
to 10%.

IPF's ratings already reflect a significant exposure to
regulatory risk.  Fitch has previously highlighted the
vulnerability of IPF's business model to similar consumer
protection measures, following rate-capping legislations
introduced in several markets in 2015, including Poland and
Slovakia.  IPF subsequently decided to exit the Slovakian market.

While the proposed Polish cap is less severe than the one
implemented in Slovakia, given the importance of the Polish
market for IPF the impact on IPF's financial profile, in the
event that the cap is fully implemented, would be material.  In
particular, the business model and franchise of IPF, together
with its business generation and profitability in the Polish
market, would be negatively affected.  Around one third of
customers from IPF's home credit division (and around 40% of
average net receivables) are located in Poland-Lithuania, with
revenue and profit before tax representing around 40% and 47% of
the division's total in 1H16.

IPF's company profile (which includes our assessment of its
franchise and business model) has a high influence on the
entity's ratings.  The ratings also reflect IPF's profitable
franchise in high risk unsecured consumer lending in emerging
markets and the company's low -- albeit increasing -- balance
sheet leverage.

Significant arrears and high non-performing loans are a feature
of IPF's business model, which are currently compensated with the
high prices IPF charges for its lending products.  If
implemented, the Polish draft legislation could effectively
prohibit IPF from charging appropriate risk-adjusted rates.

The short-term nature of IPF's assets, including in Poland,
should mitigate some pressure on leverage in the event IPF has to
severely curtail its Polish business or suffers losses while it
adjusts its cost base.  Headroom over balance sheet covenants is
solid (eg, gearing was 1.6x at end-1H16 versus a covenant of
3.75x).  However, in Fitch's opinion, its interest cover covenant
(2x covenant versus reported 3.6x at end-1H16 and calculated on a
rolling 12-month basis) would be more vulnerable in the event IPF
is unable to adjust its cost base.

                         RATING SENSITIVITIES

The RWN reflects Fitch's view that a downgrade is likely should
the draft law be implemented in its current form.  Downward
pressure would be particularly pronounced, should IPF not be able
to mitigate the effect of the cap by quickly adjusting its Polish
cost base or by compensating revenue loss in Poland by
incremental growth in its other markets.

IPF's Long-Term IDR could be removed from RWN and affirmed at
'BB+' if the Polish draft law is implemented with a less punitive
cap, which would allow IPF to right-size its Polish cost base and
maintain sound overall profitability, or if the draft law is not
implemented at all.

The senior debt rating, which has also been placed on RWN, is
primarily sensitive to a change in IPF's Long-Term IDR.

In accordance with Fitch's mapping table, IPF's Short-Term IDR is
only sensitive to a downgrade of IPF's Long-Term IDR to below
'B-'.



                            *********

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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Information contained herein is obtained from sources believed to
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