/raid1/www/Hosts/bankrupt/TCREUR_Public/181213.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Thursday, December 13, 2018, Vol. 19, No. 247


                            Headlines


B E L A R U S

BELARUSBANK: S&P Affirms 'B/B' Issuer Credit Ratings


C R O A T I A

CROATIA: Fitch Affirms BB+ Long-Term IDR, Outlook Positive
GRANOLIO: Zagreb Commercial Court Approves Restructuring Plan


F R A N C E

PAPREC: S&P Lowers ICR to 'B' on Weak Operating Performance


G E R M A N Y

BEFESA SA: S&P Raises Issuer Credit Rating to BB, Outlook Stable
* GERMANY: Number Corporate Insolvencies Hit Record Low


I R E L A N D

OAK HILL VII: Fitch Rates EUR10MM Class F Debt 'B-sf'


K A Z A K H S T A N

TSESNA-GARANT JSC: S&P Affirms B+ LT Issuer Credit Rating


L I T H U A N I A

SMALL PLANET: Two Aircraft ABS Transactions Exposed to Collapse


R U S S I A

ALTAI REGION: Fitch Affirms BB+ LT IDRs, Outlook Stable
BANK ZENIT: Fitch Affirms BB Long-Term IDR, Outlook Stable
CHUVASH REPUBLIC: Fitch Affirms BB+ LT IDR, Outlook Stable


T U R K E Y

ISTANBUL METROPOLITAN: Fitch Affirms BB LT IDR, Outlook Neg.

U N I T E D   K I N G D O M

BLIPPAR: At Risk of Administration Following Investor Dispute
KBW ASSOCIATES: Files for Liquidation
NGA UK: S&P Lowers Long-Term Issuer Credit Rating to 'B-'


                            *********



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B E L A R U S
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BELARUSBANK: S&P Affirms 'B/B' Issuer Credit Ratings
----------------------------------------------------
S&P Global Ratings affirmed its 'B/B' long- and short-term issuer
credit ratings on JSC Savings Bank Belarusbank (Belarusbank). The
outlook is stable.

S&P said, "The ratings on Belarusbank reflect our view of the
bank's leading market position and the ongoing support from the
Belarusian government due to the bank's importance in providing
banking services to the population and its key role in the
economy. We consider that the bank's projected capitalization
improved, with our projected risk-adjusted capital (RAC) ratio
increasing to 5.5%-5.6% for the next 12-18 months. We also
believe that the bank has an adequate risk management system and
a stable and diversified funding structure. We acknowledge,
however, that Belarusbank's loan portfolio remains concentrated
geographically due to predominant exposure to Belarus, and that
the bank's growth strategy remains dependent on regular
government support. We think that maintaining revenue stability
and profitability, as well as improving business diversification,
will be important for the bank to keep its strong business
position in the medium term."

As a result, Belarusbank's stand-alone credit profile (SACP)
remains at 'b+'. S&P's long-term ratings on the bank remain at
'B', capped by the sovereign rating on Belarus, reflecting both
the exposure to the risks of operating in Belarus and the bank's
dependence on regular support from the government.

Belarusbank's credit costs decreased to 2.9% on an annualized
basis as of June 2018, from its peak of 4.1% as of year-end 2017.
S&P said, "We expect this indicator will be about 2.2%-2.8% in
2018-2019, in line with the asset quality's gradual stabilization
from 2017. The effect of International Financial Reporting
Standards 9 (IFRS9) implementation was manageable and accounted
for about 4% of equity (as of Jan. 1, 2018) after first
application. Decreasing credit costs will improve the bank's
profitability, and we therefore project that our RAC ratio for
the bank will improve to sustainably above 5%, leading to
improvement in our assessment of the bank's capital and earnings
to levels we consider moderate in an international context,
versus weak previously."

S&P said, "In our view, Belarusbank's credit quality is to some
extent supported by the government guarantees provided on more
than 15% of the net loan book. The bank's level of nonperforming
loans (NPLs; loans overdue by more than 90 days) reported under
IFRS remained below 1% as of June 30, 2018.  In addition,
restructured loans accounted for an additional 9.2% of the loan
book on the same date. We expect Belarusbank's NPLs will remain
below 2% and its total nonperforming assets will be 10%-12% of
loans, comparing well with peers in Belarus."

Belarusbank remains the leading retail bank in Belarus, with a
46% market share in retail deposits and 61% in retail loans. It
has a stable and well-diversified funding base, with retail funds
representing 48% of total funding, and sufficient liquidity
buffers.

S&P said, "We continue consider the bank as having high systemic
importance, and classify Belarusbank as a government-related
entity (GRE). The bank plays a very important role for the
Belarusian government as a key financial player, implementing
important government development programs, providing funding to
strategically important economic sectors, and providing important
services to a large share of the population. At the same time, as
large contingent liabilities continue to affect the Belarusian
government's capacity to provide extraordinary support to GREs,
we regard the bank's link with the government as limited. The
resulting likelihood of Belarusbank receiving extraordinary
support from the government remains moderately high. However, no
additional notches for government support are incorporated in our
ratings.

"The stable outlook on Belarusbank mirrors that on Belarus and
reflects our view that the bank's creditworthiness and its
importance for the government will likely remain unchanged over
the next 12-18 months."

A negative rating action on Belarus would lead to a similar
action on Belarusbank.

Any positive rating action on Belarusbank would depend on a
positive rating action on Belarus since the ratings on the bank
are capped at the level of the rating on the sovereign.



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C R O A T I A
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CROATIA: Fitch Affirms BB+ Long-Term IDR, Outlook Positive
----------------------------------------------------------
Fitch Ratings has affirmed Croatia's Long-Term Foreign-Currency
Issuer Default Rating (IDR) at 'BB+'. The Outlooks are Positive.

KEY RATING DRIVERS

Croatia's 'BB+' IDRs reflect the following key rating drivers:

Croatia's ratings balance strong structural features, including
human development and governance indicators and high GDP per
capita, with weak growth potential, high public sector debt and
external vulnerabilities (heightened by still high net external
debt).

The Positive Outlook reflects Fitch's expectation that the
combination of persistent primary budget surpluses, low interest
and healthy GDP growth will contribute to a continued marked
reduction in gross general government debt. In addition,
continuing current account surpluses, supplemented by net equity
FDI and EU capital inflows, will lead to a decline in Croatia's
net external debt.

Fitch expects Croatia to outperform its budget target for the
third consecutive year in 2018, with a deficit forecast of 0.2%
of GDP, compared with the government's deficit target of 0.5%.
Croatia's fiscal performance continues to benefit from strong
revenue growth and expenditure restraint. This outperformance is
despite the materialisation of contingent liabilities stemming
from troubled shipyard company Uljanic, which Fitch expects to
amount to approximately 0.6% of GDP for this year.

Fitch forecasts the general government budget will remain broadly
balanced in 2019-20, against the small deficits projected by the
authorities. Positive fiscal dynamics are underpinned by
favourable nominal growth, the government's commitment to meeting
its expenditure rules as well as the incentive of joining the
eurozone. The government outperformed its budget balance targets
by 2.1% of GDP in 2017 and by 1.5% of GDP in 2016.

Fitch forecasts general government debt/GDP to fall to 74.1% of
GDP at end-2018, down from 84% at end-2014, and to 68.3% by 2020
and 61.9% by 2023 on the back of primary surpluses. This would
still be well above the historical 'BB' median of 38.3% of GDP.
Downside risks to debt dynamics are contained by government cash
deposits of around 6.5% of GDP (3Q), low explicit contingent
liabilities (around 1.8% of GDP, excluding Uljanic) and 'second
pillar' pension fund holding of government debt of around 17.5%
of GDP.

External deleveraging continues at a rapid pace, supported by
surpluses in the balance of payments. Although still well above
the current 'BB' range-median of 9.5%, Croatia's net external
debt is expected to fall to 20.7% of GDP by end-2018, the lowest
ratio in 15 years and over 40pp below 2013 levels. Fitch
forecasts the current account to post an average surplus of 2.3%
of GDP in 2018-20, as services exports (led by tourism) and
current transfers remain robust, offsetting a slowdown in
tradable exports. This will support a build-up of foreign
reserves and further strengthen the sovereign's net external
creditor position, helping to limit external vulnerabilities.

The economy is set to maintain a moderate rate of expansion,
averaging 2.5% in 2018-20 (versus current BB median of 4.2%),
supported by private consumption growth and price/exchange rate
stability. 3Q18 GDP growth was 0.6% qoq, only slightly below 1H
levels. As in previous years, the main driver of growth remains
domestic demand, aided by robust labour dynamics (employment is
expected to expand by around 2% this year) and tax incentives for
investment and consumption.

Medium-term economic prospects are limited by adverse demographic
trends and structural weaknesses, with potential growth estimated
at around 2%. The main downside risks include a sharper-than-
expected slowdown in GDP growth in key European markets and/or a
slowdown in tourist inflows given the importance of the sector
for growth, employment and external finances.

Labour market dynamics are putting some upward pressure on wages
but the effect on prices has been muted, with core inflation
averaging 0.6% in the first 10 months of 2018. An upcoming tax
reform to reduce VAT rates in key consumer items such as food
will further reduce upward price pressures. Fitch now expects
consumer price inflation to average only 1.4% in 2019-20,
limiting any risks of price competitiveness loss.

The banking sector remains stable with ample liquidity and
capital levels well above the regulatory minimum (22.6% 3Q18).
Unlike the Agrokor fallout in 2017, banks have felt no impact
from the troubles at Uljanic. Profitability is set to increase
only modestly, as aggregate credit demand remains muted
(household credit is rising but corporates are still
deleveraging). The rapid fall of the NPL ratio in previous years
has slowed (it stood at 10.26% in September 2018), in part due to
new classification methods but also as bulk buyers of NPL
portfolios have reduced purchases.

Croatia is putting reforms in place that Fitch believes will help
anchor monetary and macroeconomic policy coherence and
credibility ahead of formally applying to join ERM2. Croatia
could aim to join the ERM2 in 2020. An important step has been
the approval of a new Fiscal Responsibility Act that address many
institutional weaknesses highlighted by the European Commission,
including setting numerical rules for debt and deficit targets,
enhancing medium-term budgetary planning and strengthening the
role of the Fiscal Council. One of the main benefits of euro
adoption would be to reduce FX risks. Croatian balance sheets
exposure to FX (mainly euro) is substantial, with around 60% of
household and corporate debt and over 75% of public debt
denominated in foreign currency.

Croatia's structural features are much stronger than 'BB' peers.
GDP per capita is 60% above the 'BB' median and the country
scores better than 'BB' and 'BBB' peers in terms of governance
indicators and human development, thanks in part to EU
membership. The coalition government, installed in June 2017, has
been able to implement its agenda relatively smoothly despite its
small majority.

SOVEREIGN RATING MODEL (SRM) and QUALITATIVE OVERLAY (QO)

Fitch's proprietary SRM assigns Croatia a score equivalent to a
rating of 'BBB' on the Long-Term Foreign-Currency (LT FC) IDR
scale.

Fitch's sovereign rating committee adjusted the output from the
SRM to arrive at the final LT FC IDR by applying its QO, relative
to rated peers, as follows:

  - Macroeconomics: -1 notch, to reflect weak medium-term growth
    potential relative to peers.

  - Public Finances: -1 notch, to reflect high public debt; the
    SRM is estimated on the basis of a linear approach to general
    government debt/GDP and does not fully capture the increased
    risks at a high level.

Fitch's SRM is the agency's proprietary multiple regression
rating model that employs 18 variables based on three-year
centred averages, including one year of forecasts, to produce a
score equivalent to a LT FC IDR. Fitch's QO is a forward-looking
qualitative framework designed to allow for adjustment to the SRM
output to assign the final rating, reflecting factors within its
criteria that are not fully quantifiable and/or not fully
reflected in the SRM.

RATING SENSITIVITIES

Future developments that may, individually or collectively, lead
to positive rating action include:

  - Increased confidence that the ratio of public sector debt/GDP
    will remain on a firm downward path.

  - Increased resilience to external shocks through further
    reduction in external indebtedness and/or progress towards
    euro adoption.

  - Strengthening of growth prospects and competitiveness,
    including through the implementation of structural reform.

Future developments that may, individually or collectively, lead
to negative rating action include:

  - A failure to reduce government debt/GDP, for example owing to
    loosening in fiscal policy.

  - Deterioration in growth prospects or the emergence of
    macroeconomic imbalances.

KEY ASSUMPTIONS

-- Fitch assumes that the eurozone will grow by 1.7% in 2019 and
    1.6% in 2020, in line with its December 2018 Global Economic
    Outlook.

The full list of rating actions is as follows:

  Long-Term Foreign-Currency IDR affirmed at 'BB+'; Outlook
  Positive

  Long-Term Local-Currency IDR affirmed at 'BB+'; Outlook
  Positive

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

  Short-Term Local-Currency IDR affirmed at 'B'

  Country Ceiling affirmed at 'BBB'

  Issue ratings on long-term senior unsecured foreign-currency
  bonds affirmed at 'BB+'

  Issue ratings on long-term senior unsecured local-currency
  bonds affirmed at 'BB+'

  Issue ratings on short-term senior unsecured foreign and local-
  currency bonds affirmed at 'B'


GRANOLIO: Zagreb Commercial Court Approves Restructuring Plan
-------------------------------------------------------------
SeeNews reports that the commercial court in Zagreb has approved
the restructuring plan of Croatian agricultural company Granolio,
a major supplier to Croatia's food and retail concern Agrokor.

According to SeeNews, Granolio said in July it filed a motion to
open pre-bankruptcy proceedings with the commercial court in
Zagreb.

Agrokor owes Granolio some HRK100 million (US$15.3
million/EUR13.5 million), SeeNews relays, citing local media
reports.

Granolio, headquartered in Zagreb, is active in stock breeding
and production and trading of cereal crops, oilseed and animal
feed.



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F R A N C E
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PAPREC: S&P Lowers ICR to 'B' on Weak Operating Performance
-----------------------------------------------------------
S&P Global Ratings lowers to 'B' from 'B+' its long-term issuer
credit rating on Paprec and its issue rating on the company's
senior secured debt. The recovery rating for the debt is '4',
indicating S&P's expectation of average (30%-50%; rounded
estimate 35%) recovery prospects in the event of default. The
outlook is stable.

The downgrade follows Paprec's weaker than anticipated operating
performance during the nine months ending Sept. 30, 2018, and
higher leverage, due to unfavorable market developments. In the
context of China's National Sword policy, China authorities have
adopted a 0.5% contamination acceptance threshold for recovered
cardboards (versus 3% in the past) and banned all imports that do
not meet this requirement. As a result, Paprec had to make
significant investments in labor to increase recovered cardboard
quality in order to comply with the new threshold. However, the
company had to wait for Chinese custom authorities to assess the
company's recovered cardboard stocks in France before approving
the export of Paprec's recycled cardboards to Chinese paper mill
clients. As a result of a delay in the visit, Paprec's exports to
China declined in the first nine months of 2018 because the
company was unable to export before receiving approval. This had
a negative impact on raw materials volumes from recycling sold,
while cardboard inventories increased. Although Chinese customs
slowly started their assessment of Paprec's facilities in
September and October 2018, and Paprec's sales to China have
resumed, there is still some uncertainty regarding how quickly
the company will be able to sell its large cardboards inventory
to Chinese clients.

China's restrictions on imports of recycled products also led to
declining recovered cardboard prices outside China, negatively
affecting Paprec's total revenues and EBITDA. Paprec also
experienced a decline in profitability due to the combined effect
of increased staff costs -- because the company hired more staff
to improve the recovered cardboard impurity rate to 0.5% -- and
new commercial agreements with negative or low profitability.
However, S&P expects these new contracts will be fully profitable
in the coming months.

In addition, in France, regulatory pressure regarding landfill
waste increased. French local authorities now charge an
additional tax of EUR151 per ton on landfilled waste that does
not comply with prefectural orders in terms of waste origin and
type. French authorities aim to increase recycling versus
landfilling in the context of the Transition Energy Law passed in
2015, which targets a 50% reduction in waste landfilled by 2025.
Paprec anticipates that there will be an about 8 million ton
reduction in landfilled waste in 2019 in France, implying an
increase in the recycling rate of nonhazardous industrial waste
(N-HIW) in particular. This will result in higher treatment costs
for N-HIW, which will need to be charged to waste producers. If
Paprec cannot pass on these costs to customers, the company will
face additional margin pressure in 2019.

Additionally, Paprec's free operating cash flow (FOCF)
deteriorated in the nine months ending Sept. 30, 2018, due to
increased capital expenditures (capex) and large working capital
outflows. Capex increased because the company invested in
additional waste collection and waste processing equipment (such
as trucks and compactors) for new clients, given the large amount
of new contracts won during the period. Working capital outflows
were minus EUR60 million over the same period because of
increased cardboard inventories, and increased collection days
due to the change in the company's business mix to a larger
portion of revenues from services rather than recycled raw
material sales.

S&P said, "Although we expect services will provide a greater
share of recurring, contracted, and predictable revenue to
Paprec's total revenue, we believe that this may not be
sufficient to compensate for the higher-than-expected volatility
experienced in recycled raw material sales. We previously
expected Paprec would be protected, to a certain extent, from
market price volatility thanks to indexation clauses in most of
their contracts. However, we now believe that the business is
more vulnerable to external market developments and regulatory
decisions than we previous assessed.

"These developments have resulted in negative FOCF and increased
adjusted leverage of about 6.6x as of Sept. 30, 2018, which
exceeds our threshold for a 'B+' rating. We expect Paprec will
deleverage in 2019, as sales to China increase and new contracts
run at full profitability, but we also take into consideration
the potential negative impact of French landfill taxes on
profitability. Accordingly, we expect leverage will remain at
about 6.0x in 2019.

"We expect Paprec's gross reported debt will be about EUR985
million at year-end 2018, including the EUR575 million 4.0%
senior secured notes, EUR225 million floating rate notes due
2025, about EUR160 million in finance leases, and EUR25 million
in bilateral facilities and other debt. We add back to Paprec's
reported debt our estimate of operating lease liabilities of
about EUR28 million, asset retirement obligations of about EUR41
million, off-balance sheet factoring of about EUR55 million,
pension obligations of about EUR24 million, and guarantees of
EUR7 million, arriving at our adjusted debt figure of EUR1,126
million.

"The stable outlook reflects that we expect Paprec will maintain
adjusted leverage at about 6.0x in the coming 12 months, as
exports to China slowly resume and revenues and EBITDA gradually
improve in 2019, but will remain challenged by regulatory
developments in France regarding landfilling activities.

"We could lower the rating on Paprec if we anticipated that a
continued weak operating performance would result in FOCF
remaining negative in 2019 or funds from operations (FFO) cash
interest coverage declining to less than 2.0x. This could happen
if sales of recovered cardboard to China did not accelerate as
expected, if profitability weakened further, or if working
capital management worsened. We could also lower the ratings if
the group attempted a significant debt-funded acquisition,
undertook material shareholder distributions, resulting in
significantly increased leverage, or if our liquidity assessment
weakened.

"We could raise the rating if Paprec's credit metrics improved
such that our adjusted leverage ratio improved to less than 5.5x
and FFO to debt improved to over 12% on a sustained basis. This
could happen if EBITDA generation increased on stronger
profitability, and if market conditions affecting the sales of
raw materials improved."



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G E R M A N Y
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BEFESA SA: S&P Raises Issuer Credit Rating to BB, Outlook Stable
----------------------------------------------------------------
S&P Global Ratings said that it raised its long-term issuer
credit rating on the European environmental hazardous waste
recycling company Befesa S.A. to 'BB' from 'BB-'. The outlook is
stable.

S&P said, "We also raised our ratings on the EUR526 million term
loan B and a EUR75 million revolving credit facility (RCF) to
'BB+' from 'BB-'. We revised the recovery rating on both upward
to '2' from '3', indicating our expectation of meaningful
recovery prospects (70%-90%; rounded estimate: 80%) for creditors
in the event of a payment default.

"The upgrade reflects Befesa's robust results in the first nine
months of 2018, and our expectation that results will continue to
improve over the next few years. The rating action also reflects
the track record Befesa has established under its new financial
policy, which supports further deleveraging. Under our updated
base-case scenario, we project S&P Global Ratings-adjusted debt
to EBITDA between 2x-2.5x in 2018 and 2019, compared with a level
of 3x that we consider commensurate with a 'BB' rating."

Befesa, which provides recycling services to the secondary steel
and aluminum industries, has enjoyed robust operating and
financial performance in the last few years. Those were supported
by higher volumes, favorable prices, and operational excellence
in both businesses. In steel dust recycling services, Befesa
expects electric arc furnace dust throughput to reach 720,000
tons in 2018 and about 800,000 tons by 2020, compared to 590,000
tons in 2016. The greater volumes, coupled with favorable zinc
prices, would translate into EBITDA of about EUR135 million for
the division in 2018, compared to EUR100 million in 2016. S&P has
observed a similar trend in the aluminum salt slags recycling
services division.

After the delivery of several projects (such as expansion of the
steel facility in South Korea and the aluminum plant in Bernburg,
Germany), the company has initiated another phase of growth
projects, adding capacity in fast-growing markets such as Turkey,
South Korea, and China. The projects cover both the steel dust
and the aluminum slat slags recycling divisions. As for previous
projects, the growth is based on the replication of existing
facilities (both in terms of capacity and technology). The
payback period for those projects is relatively short, with
relatively low execution risk. S&P estimates Befesa's capital
expenditure (capex) at EUR50 million in 2018, peaking in 2019 at
about EUR100 million.

Earlier this year, Befesa announced entry into the Chinese
market, developing the first steel dust recycling plant in the
country. If successful, this entry could be a pivot for Befesa.
The expected increase in the use of electric arc furnaces
technology in China to produce steel, adding to and replacing
some of the existing blast furnace technology, would materially
increase the availability of steel dust in the country and
consequently Befesa's scope to grow. S&P understands Befesa
expects to complete the planned 110,000 ton facility in the
second half of 2020, with a total investment of about EUR45
million.

In November 2017, Befesa became a public company, after the
private equity owner Triton completed a partial divestment,
reducing its stake to 40.7%. S&P said, "In our view, the IPO was
a transformative event that provided better visibility to the
company's strategy and financial policy going forward. As part of
the process, the company adopted a new dividend policy, which
sets a clear framework for future cash outflows and a leverage
target of reported net debt to EBITDA of 2x over time (as of
Sept. 30, 2018, leverage was 2.4x). We understand that Triton
doesn't exercise its control, with only two members on the board
of directors and no special voting rights. Moreover, we assume
that Triton will further reduce its holding over time."

Under S&P's base-case scenario, it expects adjusted EBITDA of
about EUR180 million in 2018 and EUR185 million-EUR200 million in
2019 compared with about EUR156 million in 2017 and EUR129
million reported in the first nine months of the year. The step
up in EBITDA in 2019 will be supported by higher volumes and
healthy realized prices. The various projects underway will
support a gradual improvement in profitability after 2019.

The following assumptions underpin S&P's base case:

-- Steel production growth in Europe of 1.0%-1.5% in 2018 and
    1.5%-2.0% in 2019, driven by S&P's assumption of GDP growth
    in Western Europe of 1.8% in 2018 and 1.6% in 2019.

-- The ramp-up of the facility expansion in Korea will drive
    volume growth, as most of Befesa's facilities already operate
    at full capacity. From 2019, there will also be upside in
    volumes coming mainly from Turkey.

-- Average zinc prices of $2,825/ton in 2018 and $2,800/ton in
     2019. The current zinc spot price is about $2,500/ton. As
     part of the company's systemic hedging policy, about 70% of
     the expected zinc volumes for 2019 are hedged with an average
    price of $2,750/ton. As a result, S&P would not expect a
    downward revision to its working price assumption for 2019 to
    have a material impact on projected EBITDA. Befesa's hedging
     book was recently extended to cover the period through to
     mid-2021.

-- Average aluminum prices of $2,150/ton in 2018 and $2,100/ton
     in 2019. S&P understands that changes in the aluminum
     business have a limited effect on the company's results.

-- A moderate increase in EBITDA margins supported by the
    healthy realized zinc prices and some benefits from the
    group's cost-cutting programs and other initiatives. In 2017,
     EBITDA margins were about 24% and S&P assumes they will
     remain in the mid-20s in the next few years.

-- Total cumulative capex of about EUR150 million for 2018-2019,
    including maintenance capex of about EUR20 million-EUR25
    million annually.

-- Some swings in working capital to support current spot prices
    and higher volumes.

-- Dividend policy of distributing 40%-50% of net profit.

-- No mergers or acquisitions.

Those assumptions will be translated into:

-- Adjusted debt to EBITDA of slightly lower than 2.5x in 2018,
    improving further toward 2x in 2019.

-- Free operating cash flow of EUR70 million-EUR75 million in
    2018, and between EUR40 million-EUR50 million in 2019.

-- After factoring dividend distributions, the company is going
    to generate a discretionary cash flow of about EUR45 million-
     EUR50 million in 2018. The peak investments in 2019 are
     likely to be translated into breakeven cash flows.

The stable outlook reflects the company's ability to expand its
portfolio, while increasing its earnings, and at the same time
maintaining a supportive financial policy, notable long-term
hedge book, dividend policy, and leverage objectives.

S&P said, "We view an adjusted debt to EBITDA of 3x or better in
the coming years, as the company is going through extensive
growth phase, to commensurate with the 'BB' rating. After
completing its projects at the end of 2020, and once it returns
to generating material and steady positive discretionary cash
flows (DCF; cash flows after capex and dividends), we would see
adjusted debt to EBITDA of 3x-4x as commensurate with the current
rating. The future credit metrics in this range will also take
into account the level of zinc prices.

"Under our base-case scenario, we forecast adjusted debt to
EBITDA of 2.0x-2.5x in 2018 and in 2019. We project neutral DCF
in 2019, turning positive again starting 2020. Meanwhile, Befesa
will be able to finance its growth projects and dividends from
its cash flows, while maintaining, and later on reducing, its
absolute debt."

At this stage, S&P doesn't expect to raise the rating in the next
12-18 months.

Over the medium term, a higher rating would require either:

-- A stronger business footprint. In S&P's view, the current
    pipeline of projects is unlikely to change its assessment of
    Befesa's business risk profile. Such a change would probably
    require further growth outside the company's matured core
    markets or the establishment of another sizable line of
    business beside the steel dust recycling business; or

-- A long track record of adjusted debt to EBITDA of 3x or
     better over time, together with a material DCF. In this
     respect, 2018 would be the first time the company achieved
     this leverage level, supported by relatively healthy zinc
     prices.

S&P said, "The rating would come under pressure if we projected
adjusted debt to EBITDA to fall below 4x without a quick
recovery, coupled with negative DCF. This would be also the case
if we saw a deviation from the current financial policy."

Such a scenario could occur if Befesa saw a material
deterioration in operating performance or pursued sizable
inorganic growth, S&P said.


* GERMANY: Number Corporate Insolvencies Hit Record Low
-------------------------------------------------------
Xinhua News Agency reports that credit bureau Creditreform
announced on Dec. 11 the number of corporate insolvencies in
Germany continues to fall and has reached its lowest level since
1994.

According to Xinhua, 19,900 German companies will file insolvency
by the end of the year, which would be 1.2% less than in the
previous year.

Creditreform said with 39,470 company bankruptcies, the number of
yearly insolvencies peaked in 2003 and has since halved, Xinhua
relates.

Official figures published by the Federal Statistical Office
(Destatis) on Dec. 11 also showed a decline of corporate
insolvencies, Xinhua notes.  According the provisional figures,
German courts registered 14,715 company insolvencies from January
to September this year, Xinhua states.

The sectors that recorded the highest number of bankruptcies in
Germany are the construction industry, the retail and hospitality
sectors, Xinhua relays.  Similarly, to the prediction by
Creditreform, Destatis expects 19,800 company insolvencies by the
end of 2018, according to Xinhua.



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I R E L A N D
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OAK HILL VII: Fitch Rates EUR10MM Class F Debt 'B-sf'
-----------------------------------------------------
Fitch Ratings has assigned Oak Hill European Credit Partners VII
Designated Activity Company final ratings, as follows:

EUR240 million Class A: 'AAAsf'; Outlook Stable

EUR31.1 million Class B1: 'AAsf'; Outlook Stable

EUR12.5 million Class B2: 'AAsf'; Outlook Stable

EUR25.2 million Class C: 'Asf'; Outlook Stable

EUR27.2 million Class D: 'BBB-sf'; Outlook Stable

EUR24.3 million Class E: 'BB-sf'; Outlook Stable

EUR10 million Class F: 'B-sf'; Outlook Stable

EUR41.4million subordinated notes: 'NRsf'

Oak Hill European Credit Partners VII Designated Activity Company
is a securitisation of mainly senior secured loans (at least 90%)
with a component of senior unsecured, mezzanine, and second-lien
loans. A total expected note issuance of EUR411.7 million is
being used to fund a portfolio with a target par of EUR400
million. The portfolio is managed by Oak Hill Advisors (Europe),
LLP. The CLO envisages a 4.5-year reinvestment period and an 8.5-
year weighted average life (WAL).

KEY RATING DRIVERS

'B' Portfolio Credit Quality

Fitch places the average credit quality of obligors in the 'B'
range. The Fitch-weighted average rating factor (WARF) of the
identified portfolio is 32.04.

High Recovery Expectations

At least 90% of the portfolio comprises senior secured
obligations. Fitch views the recovery prospects for these assets
as more favourable than for second-lien, unsecured and mezzanine
assets. The Fitch-weighted average recovery rate (WARR) of the
identified portfolio is 66.91%.

Limited Interest Rate Exposure:

Up to 10% of the portfolio can be invested in fixed-rate assets,
while fixed-rate liabilities represent 3.125% of the target par.
Fitch modelled both 0% and 10% fixed-rate buckets and found that
the rated notes can withstand the interest rate mismatch
associated with each scenario.

Diversified Asset Portfolio

The covenanted maximum exposure to the top 10 obligors for
assigning the ratings is 23% of the portfolio balance. The
transaction also includes limits on maximum industry exposure
based on Fitch's industry definitions. The maximum exposure to
the three-largest (Fitch-defined) industries in the portfolio is
covenanted at 40%. These covenants ensure that the asset
portfolio will not be exposed to excessive concentration.

Adverse Selection and Portfolio Management

The transaction features a 4.5-year reinvestment period and
includes reinvestment criteria similar to other European
transactions. Fitch's analysis is based on a stressed-case
portfolio with the aim of testing the robustness of the
transaction structure against its covenants and portfolio
guidelines.

Cash Flow Analysis

Fitch used a customised proprietary cash flow model to replicate
the principal and interest waterfalls and the various structural
features of the transaction, and to assess their effectiveness,
including the structural protection provided by excess spread
diverted through the par value and interest coverage tests.

RATING SENSITIVITIES

A 125% default multiplier applied to the portfolio's mean default
rate, and with this increase added to all rating default levels,
would lead to a downgrade of up to three notches for the rated
notes. A 25% reduction in recovery rates would lead to a
downgrade of up to four notches for the rated notes.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO RULE 17G-10

Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.

DATA ADEQUACY

The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other
Nationally Recognised Statistical Rating Organisations and/or
European Securities and Markets Authority-registered rating
agencies. Fitch has relied on the practices of the relevant
groups within Fitch and/or other rating agencies to assess the
asset portfolio information.

Overall, Fitch's assessment of the asset pool information relied
upon for the agency's rating analysis according to its applicable
rating methodologies indicates that it is adequately reliable.



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


TSESNA-GARANT JSC: S&P Affirms B+ LT Issuer Credit Rating
---------------------------------------------------------
S&P Global Ratings affirmed its 'B+' long-term issuer credit and
financial strength ratings on Kazakhstan-based Insurance Company
Tsesna-Garant JSC. The outlook is negative.

At the same time, the 'kzBBB' national scale rating was affirmed.

The rating action on Tsesna-Garant follows that on its parent
Tsesnabank. S&P said, "The downgrade of Tsesnabank reflected that
deposit outflows have continued for longer than we previously
anticipated, while industry risk in the Kazakh banking system
increased, in our view. Nevertheless, we currently do not observe
any pressure on Tsesna-Garant's liquidity, capital, or financial
flexibility, as a result of the challenges its parent faces, that
would lead to a deterioration of its stand-alone credit quality.
Furthermore, we believe the regulatory framework will prevent the
outflow of funds from Tsesna-Garant to support the bank, for
example through dividend payments, material investments, or cash
deposits."

Consequently, S&P is delinking its ratings on the insurance
company from those on the group credit profile, which is based on
the rating on Tsesnabank, since:

-- S&P said, "We consider the insurance company to be insulated
    from the bank because the regulatory framework provides
    protection for the insurer in the event of adverse
    intervention from Tsesnabank. The regulatory framework also
    includes constant oversight from the National Bank of the
    Republic of Kazakhstan. In our view, the regulator for the
    insurance subsidiary is expected to act to prevent the
    subsidiary from supporting the group to an extent that would
    impair the subsidiary's stand-alone creditworthiness."

-- The group credit profile has declined quickly within a short
    period.

S&P said, "As a result this delinking, our ratings on Tsesna-
Garant solely reflect solely the insurance company's stand-alone
characteristics. We consider Tsesna-Garant to have extremely
strong capital adequacy, but relatively modest absolute size in
an international context and weak operating performance, with an
average combined (loss and expense) ratio of 110% over the past
five years.

"The negative outlook reflects our view that there could still be
an adverse impact on Tsesna-Garant's business position and
capital management stemming from the parent bank's current
financial situation. For example, in our view, the situation
within the banking group could lead to a strategic shift at the
insurance company, in particular, regarding dividend payouts or
the use of other regulatory approved instruments to support the
banking group."

S&P could lower its ratings on Tsesna-Garant by at least one
notch in the next 12 months if the situation at Tsesnabank erodes
Tsesna-Garant's stand-alone characteristics, in particular, if:

-- Tsesna-Garant's financial flexibility and capital adequacy
    deteriorates due to the payout of material dividends or
    support to the banking group via other available instruments;

-- S&P sees signs that Tsesna-Garant's competitive position has
    weakened, such as a material decline in premium volumes or
    damage to the insurer's reputation from the situation at the
    bank; or

-- Tsesna-Garant revises its investment strategy, resulting in
    the average asset quality declining to 'B' or lower.

S&P said, "We could lower the ratings by more than one notch over
that period if our ratings on Tsesna-Garant remain delinked from
the parent, and we consider that the regulatory framework doesn't
protect Tsesna-Garant from actions of Tsesnabank that could
weaken the insurer's stand-alone characteristics.

"We could revise our outlook on Tsesna-Garant to stable if none
of the abovementioned risks materialize and the insurer's
financial and business profiles, in particular its capital
adequacy and reputation, remain intact."

The revision of the outlook on Tsesnabank to stable won't
immediately lead to a similar rating action on Tsesna-Garant.



=================
L I T H U A N I A
=================


SMALL PLANET: Two Aircraft ABS Transactions Exposed to Collapse
---------------------------------------------------------------
According to Asset Securitization Report's Allison Bisbey,
Deutsche Bank Securities said at least two planes operated by
Small Planet Airlines, the Lithuanian airline that was shuttered
last month, are subject to leases that have been securitized.

Small Planet operated a fleet of 20 A320 family aircraft, 14
A320-200s and six A321-200s, with an average age of approximately
16 years, Asset Securitization Report discloses.

Deutsche Bank identified two outstanding current generation
aircraft ABS transactions with exposure to the airline -- Carlyle
Aviation Capital (formerly known as "Apollo Aviation Group")
AASET 2016-1 and the ACG-affliated Merlin 2016-1, Asset
Securitization Report relates.



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


ALTAI REGION: Fitch Affirms BB+ LT IDRs, Outlook Stable
-------------------------------------------------------
Fitch Ratings has affirmed Russian Altai Region's Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDRs) at
'BB+' with Stable Outlook and Short-Term Foreign-Currency IDR at
'B'.

KEY RATING DRIVERS

The affirmation reflects Altai's sound budgetary performance,
with a strong operating balance and low direct risk amid strong
liquidity leading to a net cash positive position. This is
balanced by the modest size of the region's economy leading to
Altai's limited fiscal capacity. The ratings also factor in the
region's low fiscal flexibility due to high dependence on the
decisions of the federal authorities amid a weak institutional
framework for Russian subnationals.

Fiscal Performance (Neutral/ Positive)

Fitch base case expects the region to maintain its sound
budgetary performance with an operating margin of about 15% and a
moderate fiscal deficit over the medium-term. This will be
supported by the regional government's effective cost management
and steady flows of transfers from the federal budget.

Fitch's rating case scenario envisages some stress on both
revenue and expenditure. However, the region should maintain a
sound operating balance about 10% of operating revenue over a
five-year horizon.

Fitch expects the region's tax capacity to remain below national
peers'. This leads to the region's high reliance on federal
transfers, which constitute about half of Altai's revenue
annually.

Altai demonstrated notable improvement in its operating
performance over the last two years, with an operating margin
averaging 18.7% compared with 7.6% in 2012-2015. The improvement
was supported by tax increase, in particular corporate income tax
(CIT), and higher current transfers, and by tight control of
operating expenditure.

During 9M18, Altai collected 76% of the revenue budgeted for the
full year and incurred 61% of the budgeted expenditure for 2018,
reflecting budgetary discipline. This resulted in an intra-year
surplus of RUB11.2 billion (2017: RUB1.4 billion), which implies
that the fiscal authorities' aim to maintain a balanced budget
over the medium term may be achievable.

Debt and Other Long-Term Liabilities (Strength/Stable)

Fitch expects Altai's direct risk to remain low by national and
international standards over the medium-term, similar to higher-
rated peers'. Historically, the region's debt has been low, with
subsidised federal budget loans being the sole debt instrument
since 2007. Altai's direct risk accounted for a low RUB2 billion
or 2.4% of current revenue at end-2017, while a strong cash
balance (RUB7.9 billion as of January 1, 2018) led to a positive
net cash position and a strong debt payback ratio.

According to Fitch's rating case Altai could increase debt up to
30% of operating revenue, but still maintain its strong debt
payback ratio (net direct risk-to-operating balance) at below
three years, in line with its 'BBB-' rating.

Refinancing risk is low as the region's debt is composed of long-
term budget loans. At end-2017, the maturity of outstanding
budget loans was extended until 2024 under a budget loan
restructuring programme initiated by the federal government. This
improved the weighted average life of regional debt to six years
as of December 2018.

Economy (Neutral/Stable)

Fitch assesses Altai's economy as weak by international standards
due to the region's low economic output per capita. Its 2016,
gross regional product (GRP) per capita was 64% of the national
median. This is due in part to the high proportion of agriculture
and food processing in the local economy. Fitch expects the
Russian economy will continue its moderate recovery with 1.5%-2%
growth in 2018-2019, with Altai likely to follow this trend.

Management (Neutral/Stable)

In general, the region's budgetary policy is dependent on the
decisions of the federal authorities and flexibility in revenue
and expenditure is low. In mitigation Altai follows a prudent and
conservative budgetary and debt policy, which is evident in its
strong accumulated liquidity and a low debt burden. At the same
time, the region maintains a high level of capex, averaging at
19% of total spending in 2012-2017. Such capex was for investment
in the social and economic infrastructure in the region,
including the development of special economic and recreation
zones.

Institutional Framework (Weakness/Stable)

The region's credit profile remains constrained by the weak
institutional framework for Russian local and regional
governments (LRGs), which has a shorter record of stable
development than many of its international peers. This leads to
lower predictability of Russian LRGs' budgetary policies, which
are subject to the federal government's continuous reallocation
of revenue and expenditure responsibilities within government
tiers.

RATING SENSITIVITIES

Sustainably strong budgetary performance with an operating margin
of about 15% and continuing low direct risk would lead to an
upgrade.

A downgrade could result from significant deterioration in
operating performance, coupled with a sharp increase in the
region's overall risk.


BANK ZENIT: Fitch Affirms BB Long-Term IDR, Outlook Stable
----------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
of Bank Zenit at 'BB' and Uralsib Bank (Uralsib) at 'B+'. The
Outlooks are Stable.

KEY RATING DRIVERS

IDRS, SUPPORT RATINGS, SUPPORT RATING FLOOR (SRF)

Zenit's Long-Term IDRs of 'BB' and Support Rating of '3' are
driven by the moderate probability of support the bank could
receive from its parent, PJSC Tatneft (BBB-/Stable), in case of
need. Fitch believes Tatneft has a high propensity to support
Zenit given its majority stake of 71.1% in the bank and solid
capital support track record to date.

The agency also believes support would be manageable for Tatneft
given its low leverage with expected funds from operations (FFO)-
adjusted gross leverage of 0.1x at end-2018 and the small size of
Zenit, whose equity accounted for 0.1x of Tatneft's last 12
months September 2018 FFO.

The two-notch difference between Tatneft's and Zenit's IDRs
reflects Fitch's view that the bank is a non-core asset for the
parent, with limited synergies between the two, as well as
limited reputational damage for Tatneft in case of Zenit's
default. The sale of the bank is unlikely in the interim,
although Fitch understands from management that this is possible
in the long term once the bank has been fully cleaned up and made
more efficient.

Uralsib's 'B+' Long-Term IDR is driven by its standalone
creditworthiness, which is reflected by the bank's Viability
Rating (VR) of 'b+'.

Uralsib's SR of '5' and SRF of 'No Floor' reflect Fitch's view
that extraordinary support from state authorities cannot be fully
relied upon in the future. Fitch recognises that the financial
assistance the bank received in 2015 helped avert losses for its
senior unsecured creditors. However, the agency does not believe
that such state support can be relied upon again, if needed,
given the significant support already provided and Uralsib's
small market shares.

VRs

The affirmation of Uralsib's and Zenit's VRs at 'b+' reflects
reducing asset quality pressures , improved risk appetite, a
good, albeit short, track record of adequate performance under
new management teams and healthy funding and liquidity profiles.
The banks' credit profiles also benefit from the recent capital
and liquidity support provided by the state Deposit Insurance
Agency (DIA) and from Tatneft to Uralsib and Zenit, respectively.
However, Zenit's ratings remain under pressure from its
vulnerable capital position, still weak, albeit improving, asset
quality and modest performance. Fitch views Uralsib's low
regulatory capital ratios and non-compliance with other
regulatory requirements, although permitted for a bank under
rehabilitation, as rating constraints. There is also an element
of key person risk in Uralsib, given that upon its rescue the
bank was sold to a private shareholder unlike other Russian
banks, which have fallen under rehabilitation procedures in
recent years.

Impaired loans (defined as Stage 3 and POCI loans under IFRS 9)
made up a high 13% of gross loans at Uralsib and a more moderate
9% at Zenit at end-3Q18, and were reasonably covered by specific
loan loss allowance (LLA) at 71% and 82%, respectively. On a net
basis, impaired loans equalled 12% of each bank's Fitch Core
Capital (FCC). Its assessment of asset quality also considers
high levels of net stage 2 loans, which added a further 15% and
90% of FCC, respectively. Additionally, Zenit has fair value
loans (9% of total loans, or 61% of FCC), which are under
performing and secured with fairly illiquid real estate.

Uralsib's related-party exposure is high (0.5x FCC at end-9M18),
although this includes loans to unconsolidated factoring and
leasing companies (about 0.2x FCC) that are performing
reasonably, in Fitch's view. Overall, Fitch views asset quality
at Zenit as more vulnerable due to higher stage 2 exposures and
the weaker quality of its largest performing loans.

Uralsib's core profitability is low, albeit improving, as
reflected by a higher net interest margin (around 5% in 9M18-
2016, annualised, up from 2.8% in 2015) and stable fee and
commission income generation, which equalled a solid 3.2% of the
bank's average loans in 9M18 (annualised). This allowed Uralsib
to improve operating profit /regulatory risk-weighted assets
(regulatory RWAs) ratio to 1.9% in 9M18 (annualised).

Zenit has weak profitability, as reflected by its operating
profit/Basel 1 risk-weighted assets (Basel RWAs) ratio of 0.3% in
9M18 (annualised). Adjusted for uncollected accrued interest, the
bank's annualised operating profit/Basel RWAs is estimated to
have been negative in 9M18.

Uralsib reported an acceptable FCC/regulatory RWA ratio of 16.2%
at end-3Q18, which included a sizeable RUB37 billion (net of
deferred tax, 8% of RWAs) fair value gain arising mostly from its
10-year, 0.51% RUB67 billion deposit from the DIA. Uralsib's
regulatory consolidated Tier 1 and total capital ratios were a
more modest 6.6% and 8.9% at the same date, below the regulatory
minimums of 8.5% and 10.5% including buffers applicable to
banking groups from 2019. This is because Russian regulatory
accounts currently disallow the booking of the above fair value
gain. Uralsib's regulatory capital ratios are expected to improve
gradually up to 2025 year due to lower interest expenses
resulting from stronger internal capital generation in local GAAP
accounts.

Zenit's FCC/Basel I RWA ratio is lower, 10% as of end-3Q18, which
is a 200bp decline from end-2017 due to the one-off impact from
IFRS 9. Consolidated regulatory capital ratios were reportedly
comfortable with Tier 1 and total capital ratios of 11.2% and
16.6% at end-3Q18, respectively. However, Zenit's capital should
be viewed in light of potentially considerable additional
provisioning needs, and its only modest pre-impairment
profitability.

Funding and liquidity are relative strengths. Uralsib and Zenit
are primarily customer funded (66% and 81% of total liabilities,
respectively). The high quality liquid assets cushion is
significantly higher at Uralsib equalling 30% of total
liabilities (45% of total customer accounts). For Zenit this is
more moderate, with the liquidity cushion, net of short-term
wholesale funding redemptions, of 17% of its customer accounts,
although the stability of Zenit's liquidity profile additionally
benefits from access to large deposit placements by Tatneft and
its related companies. At end-1H18 these amounted to RUB17
billion, or 9% of total customer accounts.

DEBT RATINGS

Zenit's senior unsecured debt is rated in line with the bank's
Long-Term IDR.

RATING SENSITIVITIES

Zenit

Zenit's IDRs will likely move in line with its parent's. The IDRs
and SR may be downgraded if Fitch views Tatneft's propensity to
support the bank as having weakened, for example due to delays in
providing timely or sufficient support.

Zenit's VR could be downgraded if asset quality and performance
deterioration results in capital erosion. Upside would require a
substantial improvement in both metrics.

Uralsib

Continued improvement of asset quality and performance, reduction
of related party exposures and strengthening of the bank's
regulatory capitalisation could result in upgrade of the bank's
Long-Term IDR and VR.

Uralsib's ratings could be downgraded if asset quality weakens
substantially resulting in negative performance and capital
pressure, although Fitch views this as unlikely.

The SR and SRF are unlikely to change given the bank's low
systemic importance and ownership structure.

The rating actions are as follows:

Uralsib Bank

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

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

  Viability Rating: affirmed at 'b+'

  Support Rating: affirmed at '5'

  Support Rating Floor: affirmed at 'No Floor'

Bank Zenit

  Long-Term Foreign- and Local-Currency IDRs affirmed at 'BB';
  Outlooks Stable

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

  Viability Rating: affirmed at 'b+'

  Support Rating: affirmed at '3'

  Long-term senior unsecured debt: affirmed at 'BB'


CHUVASH REPUBLIC: Fitch Affirms BB+ LT IDR, Outlook Stable
----------------------------------------------------------
Fitch Ratings has affirmed the Russian Chuvash Republic's
Long-Term Foreign- and Local-Currency Issuer Default Ratings at
'BB+' with Stable Outlooks and Short-Term Foreign-Currency IDR at
'B'.

The affirmation reflects the republic's sound fiscal performance
and moderate direct risk. This is balanced by the modest size of
the republic's economy and budget leading to a limited fiscal
capacity. The ratings also factor in the region's low fiscal
flexibility due to a high dependence on the federal authorities
for budgetary decisions amid a weak institutional framework for
Russian subnationals.

KEY RATING DRIVERS

Budgetary Performance (Neutral/Stable)

Fitch's base case forecasts that the republic will maintain a
sound budgetary performance with the operating margin at about
15%-16% and a close to balance budget in 2019-2022. This is a
moderate deterioration compared with a strong margin at about 18%
in 2016-2017 (2018 Fitch's estimate: 18%), driven by higher
operating expenditure outpacing growth of operating revenue.
Higher operating spending will be fuelled among other things by
higher staff costs, following the recent federal government
decision to increase minimal salary to subsistence level.

At the same time, the republic's operating revenue will be
supported by a gradual recovery of the local economy and steady
flows of transfers from the federal budget. The latter is due to
a new formula of general purpose grants allocation and higher
earmarked transfers for co-financing salary increase.

Fitch's rating case scenario envisages some stress on both
revenue and expenditure. However, the region should maintain a
sound operating balance above 10% of operating revenue, which
will be in line with Chuvashia's ratings.

The moderate size of the republic's local economy and budget
results in smaller tax capacity and ability to absorb potential
shocks than national peers. This leads to the region's high
reliance on federal transfers, which constitute a third of
Chuvashia's operating revenue annually.

Debt and Liquidity (Neutral/Stable)

Fitch's base case assumes the region's net direct risk will
remain moderate at below 30% of operating revenue (2017: 29%).
Fitch believes that the expected 2018 deficit will likely be
covered by the republic's cash balance (RUB2.6 billion as of
January 1, 2018) and will not fuel absolute debt growth.

According to Fitch's rating case, Chuvashia could increase net
direct risk up to 47% of operating revenue. However, debt
sustainability, measured by payback ratio (net direct risk-to-
operating balance) will remain strong at below four years.

Chuvashia's direct risk profile is dominated by low-cost budget
loans, which accounted 55% as of January 1, 2018. Due to an
interim surplus of RUB5.2 billion, Chuvashia has repaid all
outstanding market debt and low cost budget loans were its sole
direct risk as of October 1, 2018, allowing the region to save on
interest payments. Fitch expects the region will contract about
RUB6 billion bank loans by end-2018, so the proportion of budget
loans as a share of direct risk will likely fall below 50% in the
medium term. A higher proportion of market debt (bonds and bank
loans) will add pressure to debt servicing and refinancing needs,
in Fitch's view.

Management and Administration (Neutral/Stable)

In general, the republic's budgetary policy is strongly dependent
on the decisions of the federal authorities and has low
flexibility both in revenue and expenditure. In mitigation, the
administration follows a prudent and conservative budgetary
policy, which is manifested by a moderate debt burden. The
administration intends to narrow the region's fiscal deficit and
gradually reduce debt relative to revenue in the medium term, in
line with a bilateral agreement with the federal Ministry of
Finance.

Economic (Weakness/Stable)

Chuvashia is a medium-sized region in the eastern part of
European Russia with a population of 1.231 million residents. The
republic's socio-economic profile is historically weaker than
that of the average Russian region. Its per capita GRP was 61% of
the national median in 2016. Fitch expects the Russian economy
will continue a moderate recovery at 1.5%-2.0% in 2018-2019, and
Chuvashia will likely follow this trend.

Institutional Framework (Weakness/Stable)

The region's credit profile remains constrained by the weak
institutional framework for Russian local and regional
governments (LRGs), which has a shorter record of stable
development than many of its international peers. This leads to
lower predictability of Russian LRGs' budgetary policies, which
are subject to the federal government's continuing reallocation
of revenue and expenditure responsibilities within government
tiers.

RATING SENSITIVITIES

Consolidation of strong budgetary performance with an operating
margin of about 15% on a sustained basis, accompanied by improved
fiscal flexibility and moderate direct risk could lead to an
upgrade.

Growth of direct risk, accompanied by deterioration in the
operating performance leading to a direct risk-to-current balance
rising above eight years on a sustained basis, would lead to a
downgrade.



===========
T U R K E Y
===========


ISTANBUL METROPOLITAN: Fitch Affirms BB LT IDR, Outlook Neg.
------------------------------------------------------------
Fitch Ratings has affirmed the Metropolitan Municipality of
Istanbul's (Istanbul) Long-Term Foreign-Currency Issuer Default
Rating (IDR) at 'BB' and Short-Term Foreign-Currency IDR at 'B'.
Fitch has also affirmed Istanbul's Long Term Local-Currency IDR
at 'BB+ 'and the National Long-Term Rating at 'AAA(tur)' with a
Stable Outlook. The Outlooks on the IDRs are Negative and reflect
that on the sovereign, as Istanbul's ratings are capped by the
Turkish sovereign ratings (BB/Negative).

In its rating case the affirmation reflects Istanbul's continued
robust operating performance, owing to its resilient local
economy throughout the expected recessionary period of the
national economy in 2019-2020. The ratings also reflect an
expected increase in debt stemming from large capex realisations,
which will be supported by robust operating balance coverage,
keeping debt to current balance below three years on average.

KEY RATING DRIVERS

Fiscal Performance (Strength/Stable)

Fitch's rating case projects Istanbul will post robust operating
margins, thanks to its well diversified economy, although they
will decline to a low 40% in 2018-2020. Fitch applies a
conservative approach in its rating case and expect shared tax
revenue attributable to the metropolitan area to grow in line
with the national average following Fitch's downward revision of
national GDP and inflation adjustments for 2018-2020.

3Q18 interim budgetary results demonstrated a continuation of the
robust local economic performance, by collecting 78% of the
budgeted shared tax revenues. Istanbul maintained opex control,
mainly on goods and service items and kept opex at 77.6% of the
budgeted amount, while collecting 78% of the budgeted operating
revenue and generating an interim operating margin of a high
44.8% yoy.

Interim capex remained high, in line with its rating case and
accounted for 82% of the budgeted amount. For FYE18 in its rating
case Fitch expects capex to account for 88% of the budgeted
amount and to generate a pre-financing deficit of about 25% of
total revenue, which will largely be debt funded.

Debt (Neutral/Stable)

Istanbul's unhedged foreign currency denominated debt made up
80.4% of total debt in 2017 (2016: 98%), exposing the city to
significant foreign exchange risk. Lira's slump by more than 50%
in August 2018 led to a dent in the city's budgetary performance
by inflating its nominal debt stock. Accordingly, in its rating
case Fitch expects about 50% of depreciation of the lira against
the euro and US dollar for year-end-2018. This will increase
Istanbul's nominal debt burden by about 40% by the year-end 2018,
leading an increase in the debt payback ratio (direct debt/
current balance) to 3.3 years from 2.1 years in 2017.
Nevertheless, in its rating case Fitch does not expect
significant lira volatility for 2019-2020. Fitch expects that
generation of the operating balance will continue, helping debt
payback to remain below three years, which is commensurate with
the rating.

In its rating case Fitch also takes into account the weighted
maturity of the city's FX debt at six years, well above its
expected debt payback ratio. In addition, the amortising nature
of the city's debt and the predictable and non-seasonal monthly
cash flows associated with the city's credit lines with state-
owned and commercial banks mitigate short-term refinancing risk.
Year-end liquidity levels are stressed where the large operating
surpluses cannot be used to increase cash in general, due to
ongoing large capex expected in 2018-2020. At year-end 2017 cash
levels further weakened and covered 0.2x of the city's annual
debt servicing costs, but good access to financial markets and
undrawn committed bank lines are expected to mitigate liquidity
risk.

Fitch also expects in its rating case that direct risk will
increase significantly to about TRY25 billion at end-2020 from
TRY15 billion at end-2017, as the city is shifting its borrowing
to intercompany borrowing (from ISKI, the water and sewage
facility due to zero interest rates and netting out of this debt
by asset transfers rather than cash.

ISKI is Istanbul's only profitable affiliate (public sector
entity- Istanbul has two affiliates: ISKI and IETT (bus
operator)) and its debt is negligible, with debt to current
revenue below 1%. At end 2017 ISKI posted a deficit of TRY782.7
million or 14% of total revenue, after posting a surplus of
TRY190.4 million in 2016. However, the deficit is fully covered
by cash. ISKI has been refinancing its investments purely from
its operating surpluses for more than a decade. Istanbul's
contingent liabilities are low, as almost all of its companies
are self-funding. Their debt declined by less than 1% of city's
operating revenue in 2017.

Economy (Strength/Stable)

Istanbul is Turkey's main economic hub, contributing on average
30.5% of the country's gross value added in 2006-2014 (latest
available statistics), with GDP per capita of USD19,957 in 2014,
far above the national average of USD12,112 . This enables
continued fiscal strength and good access to financial markets
and therefore liquidity. Rapid urbanisation and continued
immigration flows challenge the province with a continued need
for infrastructure investments. In 2017, the population grew 1.5%
yoy to 15,029,231 inhabitants.

Management (Weakness/Stable)

The 'Weakness' assessment is based on the deterioration in fiscal
discipline, which is mainly due to elevated capex. Istanbul is
one of the most traffic congested cities internationally and in
need of investment in public transportation, but management's
rush to increase capex before the local election cycles as well
as the related purchase of services and goods pressurise the
city's liquidity ratios and limits its financial flexibility,
especially when considering its exposure to unhedged FX
liabilities.

Institutional Framework (Weakness/ Stable)

Istanbul's credit profile is constrained by a weak Turkish
institutional framework, reflecting a short track record of a
stable relationship between the central government and local
governments with regard to allocation of revenue and
responsibilities, weak financial equalisation system and the
evolving nature of its debt management in comparison with
international peers.

RATING SENSITIVITIES

Istanbul's rating is at the sovereign level. A reduction in the
city's debt-to-current revenue below 60% on a sustained basis,
coupled with continued financial strength and consistent
management policies, could trigger positive rating action,
provided there has been a sovereign upgrade.

Negative rating action on Turkey would be mirrored on Istanbul's
ratings. A sharp increase in Istanbul's direct debt-to-current
balance above four years, driven by capex and local currency
depreciation could also lead to a downgrade of its Long-Term
IDRs.



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


BLIPPAR: At Risk of Administration Following Investor Dispute
-------------------------------------------------------------
Ka Kay Lum at Deal Street Asia reports that London-based
augmented reality startup Blippar is said to be facing
administration and is "on the brink of collapse" after a dispute
between its investors, British luxury property developer Nick
Candy and Malaysia's sovereign wealth fund Khazanah Nasional Bhd.

According to Deal Street Asia, a report by The Times said
Khazanah has blocked an emergency fundraising by the unicorn
startup, causing Blippar to reach out to its shareholders, saying
it had been left with "no current option other than to give
notice to start insolvency proceedings".

It is said that Blippar has appointed insolvency practitioners
David Rubin & Partners, fueling speculation that Candy may
purchase the startup through a pre-pack administration deal, Deal
Street Asia relates.

Launched in 2011, Blippar has operations in New York, Los
Angeles, San Francisco, Chicago, New Delhi, Bangalore, and
Singapore, Deal Street Asia discloses.  Its San Francisco office
was shut down last year, Deal Street Asia, Deal Street Asia
recounts.


KBW ASSOCIATES: Files for Liquidation
-------------------------------------
Christopher Elser at Bloomberg News reports that KBW Associates
Ltd. told the U.K.'s Financial Conduct Authority that it has
filed for liquidation, a form of bankruptcy.

"Any client who is considering submitting a claim should contact
the Financial Services Compensation Scheme to discuss how to
register a claim," Bloomberg quotes the FCA as saying.  Clients
who have already complained to the Financial Ombudsman
Service should speak to their case handler to discuss next steps,
including whether their complaint will be transferred to the FSCS
for consideration."

The company is based near Cannon Street Station in London,
according to its website.


NGA UK: S&P Lowers Long-Term Issuer Credit Rating to 'B-'
---------------------------------------------------------
S&P Global Ratings lowered to 'B-' from 'B' its long-term issuer
credit rating on Colour Bidco Ltd., the parent company of U.K.-
based human resources and payroll provider NGA UK.

At the same time, S&P lowered to 'B-' from 'B' its issue rating
on NGA UK's GBP260 million senior secured term loan. The recovery
rating is unchanged at '3', indicated S&P's expectation of
meaningful recovery (50%-70%; rounded estimate 55%) in the event
of default.

The downgrade primarily reflects the higher-than-anticipated
increase in debt following the completion of NGA UK's carve out
from parent Northgate Information Solutions in February 2018 and
the mainly debt-financed acquisition of Benefex completed in
September 2018. Total carve-out costs were estimated at GBP30
million during the fourth fiscal quarter of 2018 and first fiscal
quarter of 2019, and were almost entirely financed by drawings on
the company's revolving credit facility (RCF). S&P also estimates
that the acquisition of HR software provider Benefex will add an
additional GBP20 million of debt, and that Benefex will make
limited EBITDA contributions over the short term.

The downgrade also partly reflects a weaker-than-expected
operating performance during 2018. Reported sales declined by
4.9% during the year due to weaker-than-expected new license
sales of the company's core HR software, Resourcelink, during the
carve-out period. This also cut into implementation revenues.

S&P said, "As a result, we now expect NGA UK's gross debt to
EBITDA to increase to about 15x (8.0x, excluding carve-out and
transformation-related costs) in FY2019, from about 7.6x for
FY2018. It should remain above 7.5x in FY2020. This compares with
our previous base case of 6.8x in FY2019.

"In addition, we forecast annual free operating cash flow (FOCF)
generation of only about GBP10 million-GBP15 million in FY2019
(excluding exceptional carve out and transformation costs),
suggesting a S&P Global Ratings-adjusted FOCF-to-debt ratio of
about 3%-5% over the same period. Our previous forecast stood at
GBP20 million-GBP25 million (corresponding to adjusted FOCF to
debt of 6%-8%). In preparing this forecast, we excluded about
GBP4.9 million in annual contributions to the company's pension
plan, which we consider as part of the company's debt repayment."

That said, NGA UK benefits from relatively good cash conversion
thanks to low capital expenditure (capex) requirements, excluding
capitalized expenses for research and development (R&D), and
limited working capital requirements due to a large recurring
revenue base with upfront annual billing.

S&P's view of the company's business risk profile continues to be
constrained by NGA UK's small scale and limited geographic
diversity compared with most of its rated peers in the software
sector. In FY2018, NGA UK generated about GBP131 million of
revenues and about GBP47 million of EBITDA, and operated entirely
in the U.K. and Ireland.

NGA UK's business risk profile is further constrained by its
narrow specialization on HR and payroll products, where the
market is very competitive and fragmented and there are only
modest entry barriers, in our view. Although NGA UK's payroll
software solutions are critical to customers' operations, S&P
does not consider that they are as embedded in customers' IT
strategy as software that supports revenue generation, for
instance. NGA UK's customer base also exhibits some customer
concentration because the 10 largest customers account for about
a quarter of total revenues.

This is partly offset by NGA UK's good profitability -- it
reported EBITDA margins of 32.5% in FY2018 and solid cash
conversion of about 30% of EBITDA (both excluding carve-out
costs). The business risk profile further benefits from the
company's leading position in the HR and payroll services in the
U.K. According to management, NGA UK held approximately 19%
market share for HR software in the mid-market enterprise
segment, which is roughly twice the market share of the second
player in this segment. The company also holds roughly 8% for the
market in HR software for small and midsize businesses.

Furthermore, NGA UK's relatively high proportion of recurring
revenues provides good visibility on future earnings. In FY2017,
85% of NGA UK's revenues were recurring. The company has achieved
meaningful software as a service (SaaS) penetration among its
existing client base, and expects to increase this further as it
transitions its customers from on-premises to cloud-based
solutions.

S&P said, "Our financial risk profile assessment still reflects
NGA UK's highly leveraged pro forma capital structure and our
expectation that Bain Capital will likely pursue an aggressive
financial policy.

"We calculate NGA UK's leverage on a gross debt basis. We have
added to our debt calculation for NGA UK about GBP37 million
unfunded pension obligations in FY2018 and adjusted EBITDA for
capitalized development costs (about GBP8 million in FY2018).
The stable outlook reflects our expectation that NGA UK will
successfully increase revenues in 2019 by delivering on various
sales growth initiatives including investment in its current
sales force and pushing more aggressive price increases. We
anticipate that this will lead to sales growth of 2%-3% and
reported FOCF generation of at least GBP10 million over the next
12 months, with leverage remaining above 7.5x.

"We could raise the rating if reported FOCF of GBP15 million-
GBP20 million and adjusted debt-to-EBITDA decreased below 7.5x.

"We think this could be achieved through better-than-expected
operating performance, including a faster-than-expected
transition to Saas and an acceleration in payroll outsourcing of
existing ResourceLink users. This could also be achieved through
higher-than-expected new client wins or realization of cost
benefits from various off-shoring and automation initiatives,
which would lead to EBITDA margin improving to above 35%.

"Although unlikely in the next 12 months, we could lower the
rating if NGA UK generated breakeven FOCF, causing its liquidity
to deteriorate materially. This could be the result of operating
performance deterioration from intense competition, higher
customer churn, or loss of market share."

-- Colour Bidco's GBP260 million senior secured term loan is
     rated 'B-', with a recovery rating of '3'. The recovery
     rating indicates S&P's expectation of meaningful (50%-70%;
     rounded estimate 55%) recovery in the event of a payment
     default.

-- S&P's default scenario envisages, among other things, a
    weaker operating environment, significant deterioration in
     demand, coupled with a prolonged economic recession and
     overexpansion that causes material pricing pressure and
     increased customer churn. In addition, S&P envisages that
     technology risks from the company's product offering could
     lead to customer defections.

-- S&P values Colour Bidco as a going concern given the long-
     term nature of its customer contracts and some switching
     costs for existing customers to replace its software
     solutions.

-- Year of default: 2020
-- Minimum capex (% of sales): 1%
-- Miscellaneous items: GBP4.9 million for annual pension
    deficit funding payments
-- Cyclicality adjustment factor: +5% (standard sector
    assumption)
-- Operational adjustment: +5% (reflecting our assumption that
    long-term contracts with clients would provide for some
    limit/protection to EBITDA decline)
-- Emergence EBITDA after recovery adjustments: about GBP31.9
    million
-- Implied enterprise value multiple: 6x
-- Jurisdiction: U.K.

-- Gross enterprise value at default: about GBP191.7 million
-- Administrative costs: 5%
-- Net value available to debtors: GBP182.1 million
-- Prior-ranking claims: nil
-- Secured debt claims: about GBP330 million*
-- Recovery expectation: 55% (Recovery rating: 3)

*All debt amounts include six months of prepetition interest.
Assumes RCF 85% drawn.



                            *********

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.
Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.

Copyright 2018.  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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