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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

          Tuesday, April 2, 2019, Vol. 20, No. 66

                           Headlines



A R M E N I A

ACBA-CREDIT AGRICOLE: Fitch Affirms IDRs at B+, Outlook Stable


F R A N C E

TECHNICOLOR S.A.: S&P Cuts ICR to B After Weaker 2018 Performance


G E O R G I A

TEGETA MOTORS: Fitch Affirms Then Withdraws 'B-' Long-Term IDR


I R E L A N D

ARBOUR CLO: Moody's Upgrades Class F Notes Rating to 'B1'
HOUSE OF EUROPE IV: Fitch Affirms Class C & D Note Ratings at 'Csf'
SYNCREON GROUP: S&P Downgrades ICR to CCC-, Outlook Negative


I T A L Y

GRUPO BANCARIO: Fitch Assigns 'BB' LT IDR, Outlook Stable


N E T H E R L A N D S

CARTESIAN RESIDENTIAL: Fitch Rates Class E Notes 'BB(EXP)sf'
PRECISE MIDCO: Moody's Assigns B3 CFR, Outlook Stable


P O R T U G A L

NAVIGATOR COMPANY: S&P Alters Outlook to Pos., Affirms BB LT ICR


R U S S I A

ABSOLUT BANK: Moody's Confirms B2 LT Deposit Ratings, Outlook Neg.
ETALON LENSPETSSMU: S&P Affirms 'B+/B' Rating on Leader Invest Deal
O1 PROPERTIES: S&P Alters 'CCC' ICR Outlook to Developing
PIK GROUP: S&P Hikes Rating to B+ on Tightened Financial Policy
TMK PAO: S&P Places 'B+' ICR on Watch Positive on Sale of IPSCO



S P A I N

FONCAIXA FTGENCAT 4: Fitch Affirms Class E Notes Rating at 'CCsf'


U N I T E D   K I N G D O M

ASTON MARTIN: S&P Affirms 'B' LT ICR, Alters Outlook to Neg.
DEBENHAMS PLC: Investors Express Support to Install Ashley as CEO
JAMIE'S ITALIAN: Averts GBP1MM in Unpaid Rent Following CVA
LK BENNETT: Philip Day Pulls Out of Race to Acquire Business
LONDON CAPITAL: First-Time Investors May Not Get Compensation

LONDON CAPITAL: Regulators Failed to Take Action on Toxic Bonds
SMALL BUSINESS 2019-1: Moody's Rates Class D Notes '(P)Ba3'
TOWD POINT 2019: S&P Assigns Prelim BB Rating to F-Dfrd Notes

                           - - - - -


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A R M E N I A
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ACBA-CREDIT AGRICOLE: Fitch Affirms IDRs at B+, Outlook Stable
--------------------------------------------------------------
Fitch Ratings has affirmed ACBA-Credit Agricole Bank CJSC's (ACBA)
and Ardshinbank's (Ardshin) Long-Term Foreign-Currency Issuer
Default Ratings (IDRs) at 'B+' with Stable Outlooks.

KEY RATING DRIVERS

IDRS, VRS, SUPPORT RATINGS, SUPPORT RATING FLOORS

The IDRs and senior debt ratings of both banks are driven by their
intrinsic strength, as captured by their 'b+' Viability Ratings
(VRs). The affirmation of both banks' VRs reflects limited changes
in their credit profiles since the previous rating actions a year
ago. The VRs continue to reflect a cyclical local economic
environment, which translates into potentially vulnerable asset
quality, and high dollarisation. The VRs also capture the banks'
stable asset quality, supported by a cyclical upswing of the
economy, reasonable capital and liquidity buffers (both stronger at
ACBA) and moderate profitability.

The banks' Support Rating Floors of 'No Floor' and Support Ratings
of '5' reflect Fitch's view that the Armenian authorities have
limited financial flexibility to provide extraordinary support to
banks, if necessary, given the banking sector's large
foreign-currency liabilities relative to the country's
international reserves. Potential support from the private
shareholder is not factored into Ardshin's ratings, as it cannot be
reliably assessed.

Fitch also believes that extraordinary support from ACBA's
6.48%-shareholder, Credit Agricole (CA, A+/Stable), cannot be
relied upon and therefore factored into the bank's ratings. As
there have been no prior cases of extraordinary capital or
liquidity support being required by ACBA, support track record from
CA therefore cannot be assessed.

VRS

ACBA

ACBA's impaired loans (defined as Stage 3 and POCI loans under IFRS
9) made up a moderate 4.8% of gross loans at end-2018, and were
reasonably covered by total loan loss allowance (LLA) at 68%
(preliminary data, as audited IFRS report has not yet been
published). At end-2018 impaired loans net of total LLA equalled to
a modest 5.7% of ACBA's Fitch Core Capital (FCC). Additional asset
quality risks are limited with stage 2 loans at 1.4% of gross
loans. At the same time ACBA's loan quality is undermined by a
large appetite for high-risk agricultural lending (30% of gross
loans at end-2018) and a sizeable unsecured retail loan portfolio
(23% of gross loans).

ACBA's pre-impairment performance balances a wide net interest
margin of 7.5% with high operating expenses, stemming from the
bank's modest size. Pre-impairment operating profit equalled to
3.4% of ACBA's average loans in 2018, offering only moderate loss
absorption capacity. The bottom line is reasonable as expressed by
a return on average equity (ROAE) of 11%. Moderate profitability
improvement may be expected given the bank's business expansion
plans, although this is conditional on the stability of the broader
economic environment.

ACBA's FCC equalled a high 18% of regulatory risk-weighted assets
(RWAs) at end-2018, although this should be viewed in light of a
generally high-risk operating environment. Capital ratios may
moderate somewhat in the medium term as ACBA's planned loan growth
may exceed internal capital generation while annual sizeable
dividend pay-outs cannot be ruled out.

The share of non-deposit funding remains high, albeit decreasing in
favour of client accounts, as captured by a loan-to-deposit ratio
of 125% at end-2018, down from 180% at end-2015. Non-deposit
funding is mainly in the form of longer-term external funding
raised from international financial institutions (IFIs) and
government institutions and used to finance the agricultural,
micro- and SME segments. Contractual repayments of wholesale
funding in 2019 equalled to a moderate 7% of total liabilities and
were well-covered by ACBA's cushion of liquid assets (27% of total
liabilities at end-2018).

ARDSHIN

At end-2018, impaired loans (defined as Stage 3 and POCI loans
under IFRS 9) equalled to 4.7% of gross loans and were 43% covered
with total LLA (preliminary data, as audited IFRS report has not
yet been published). Net of LLA, impaired loans equalled to a
moderate 18% of the bank's FCC at end-2018. Stage 2 loans made up a
further 2.2% of the bank's gross loans or 15% of FCC. On top of
that, Ardshin was exposed to some stage 1 loans, which are viewed
by Fitch as high-risk. These equalled to an additional 3.9% of
gross loans or 26% of FCC.

Fitch believes that despite hard collateral available for most of
these loans Ardshin might have to absorb additional impairment
losses related to at least some of the loans over the medium-term.
Asset quality is also weakened by a large portfolio of repossessed
assets (14% of FCC), and the disposal of these may result in
additional impairment costs.

Pre-impairment operating profit was 3.8% of Ardshin's average loans
in 2018, offering only modest loss absorption capacity relative to
the asset quality risks. Loan impairment charges for 2018 were
moderate, equaling to 1.4% of average gross loans; this supported a
reasonable ROAE of 12% in 2018, but future performance is highly
sensitive to asset quality.

Ardshin's FCC was moderate at 14% at end-2018. Capital pressure
could stem from additional provisioning needs and the planned
phase-in of additional regulatory capital buffers for domestic
systemically important banks starting from 2020, which could
somewhat restrain the bank's growth plans.

Ardshin's reliance on wholesale funding is high, as expressed by a
129% loans/deposits ratio at end-2018. Non-deposit funding made up
a high 39% of total liabilities at end-2018. Refinancing risks are
high, as at end-2018 Ardshin's liquidity buffer was just marginally
above contractual repayments of wholesale funding for 2019 (12% of
total liabilities). However, management expects the bank to be able
to refinance most of these wholesale borrowings.

SENIOR UNSECURED DEBT

Senior unsecured debt ratings are in line with the respective
banks' IDRs, reflecting average recovery prospects in case of
default.

RATING SENSITIVITIES

IDRS, VRS, SUPPORT RATINGS, SUPPORT RATING FLOORS

Upside for the ratings would require an improvement of the
operating environment, which Fitch continues to view as highly
cyclical and vulnerable to external shocks. A sovereign upgrade
would not trigger a positive rating action on any of the banks.
However, an extended track record of stable asset quality metrics
and performance, and stronger capital ratios (Ardshin), would be
credit-positive.

The ratings could be downgraded if a weaker operating environment
or a material increase in risk appetite results in a marked
deterioration of the banks' asset quality and erodes their
profitability and capital without being sufficiently and
pre-emptively addressed by the shareholders.

SENIOR UNSECURED DEBT

Changes to the banks' Long-Term IDRs would impact the senior
unsecured debt ratings.

The rating actions are as follows:

ACBA

Long-Term IDR affirmed at 'B+', Outlook Stable

Short-Term IDR: affirmed at 'B'

Viability Rating: affirmed at 'b+'

Support Rating: affirmed at '5'

Support Rating Floor: affiirmed at 'No Floor'

Senior unsecured debt: affirmed at 'B+'; Recovery Rating 'RR4'

Ardshin

Long-Term IDR: affirmed at 'B+', Outlook Stable

Short-Term IDR: affirmed at 'B'

Viability Rating: affirmed at 'b+'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

Senior unsecured debt (issued by Dilijan Finance B.V.): affirmed at
'B+', Recovery Rating 'RR4'



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F R A N C E
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TECHNICOLOR S.A.: S&P Cuts ICR to B After Weaker 2018 Performance
-----------------------------------------------------------------
S&P Global Ratings lowered its long-term issuer credit rating on
Technicolor S.A. to 'B' from 'B+'.

S&P said, "The downgrade reflects that we have revised downward our
base-case expectation for Technicolor's EBITDA and credit metrics
in 2019, after weaker-than-expected 2018 results. We take into
account weaker earnings in Technicolor's Connected Home and DVD
segments, combined with higher restructuring costs and lower debt
repayment in 2018. The stable outlook reflects our expectation that
the group's profitability and key ratios will remain in line with
our requirements for the lower rating. We take this view despite an
improvement in 2019 compared with 2018 on stronger trading
environment and successful implementation of the group's plan to
optimize its operations and costs base."

Technicolor's adjusted EBITDA declined in 2018 to about EUR215
million from EUR287 million in 2017. This resulted from: Weak video
demand in North America, resulting in Connected Home EBITDA
declining by almost EUR80 million. Continued increase in memory
chip prices throughout 2018 despite the late introduction of cost
pass-through clauses in Technicolor's contracts. At the same time,
the division suffered from a temporary shortage in capacitor
supply. All in all, issues relating to components had a net
negative effect on 2018 EBITDA of about EUR45 million.

Underperformance of EBITDA generated by the DVD unit due to an
order cancellation, and cost inflation related to hiring
requirements to cope with a quicker refurbishment ramp-up imposed
by a key customer ahead of Black Friday. Large restructuring costs
of about EUR60 million, invested to streamline Technicolor's
operations and cost structure, which further depressed our adjusted
EBITDA as of the end of 2018. S&P has therefore lowered its EBITDA
and cash flow forecasts for 2019, starting from a lower base as of
end-2018. We now forecast weaker credit metrics than its previous
base case, with adjusted debt to EBITDA between 5.0x and 5.5x,
while funds from operations (FFO) will remain below 15% and free
operating cash flow (FOCF) to debt below 10% throughout 2019.

S&P said, "We factor in our rating that Technicolor is smaller than
large suppliers and customers, resulting in some volatility in
revenues and cash flows. This is because we believe the group has
limited negotiating power to secure profitable access to components
and to agree contractual clauses with its customers in good time.
We also take into account Technicolor's vulnerability to order
cancellations or postponements, while the successful implementation
of the group's optimization will largely drive future profitability
gains.

"These weaknesses are partly offset by our view that Technicolor
will likely benefit from its leading market position in Production
Services, its No. 2 market position in Connected Home, and its
last-man-standing strategy in the DVD segment with more than 95%
market share in the U.S. We factor in the hedging introduced in
most Connected Home contracts, protecting the group from an
increase in memory chip prices, as well as the planned decline in
restructuring costs. We also take into account efficiency gains
from the ongoing implementation of the group's three-year plan to
optimize its cost structure and operations. We believe this will
support our forecast of adjusted EBITDA recovery from 2019, albeit
slowed down by recent underperformance.

"As a result, we believe Technicolor's Connected Home profitability
will start improving. This is based on our view that management has
anticipated further setbacks in Connected Home--including memory
chip cost-pass-through mechanisms--in most of the contracts and is
implementing processes to increase visibility and secure its access
to capacitors. Additionally, despite recent setbacks, Technicolor
has maintained its No. 2 position worldwide in Connected Home,
while increasing its market share in broadband, especially in North
America, and in Android TV, securing sound growth prospects and
offsetting the planned decrease of video demand.

"We acknowledge DVD demand is in structural decline and we do not
exclude unexpected order cancellations or cost slippage from
happening again. However, Technicolor has already advertised that,
at contract renewal starting from January 2020, it will likely
increase its prices and introduce volume-based pricing with
studios. We therefore believe that Technicolor's strategy of being
the last man standing in the DVD business will likely benefit the
upcoming negotiations, and partly offset the segment's structural
decline. Finally, we believe Production Services will be the growth
engine of the Entertainment Services segment as Technicolor enjoys
a good competitive position in the visual effects (VFX) and
post-production business, which should further strengthen through
investment in raising and optimizing capacity.

"The stable outlook reflects our expectation that the group will
strengthen its product proposition and cost structure. We therefore
expect that in 2019, Technicolor will reach adjusted debt to EBITDA
of 5.0x-5.5x, FFO to debt at about 13%, and FOCF to debt at about
7%.

"We could lower the rating further if Technicolor posted adjusted
debt to EBITDA consistently above 6.0x, FFO to debt below 10%, or
FOCF to debt below 5%. This could result from EBITDA deterioration
due to order cancellations in Connected Home, higher-than-expected
restructuring costs, or more pronounced volume decline in DVD than
anticipated. We could also lower the rating if Technicolor starts
drawing on its revolving credit facility (RCF) to fund its
day-to-day operations or should springing covenant headroom, if
tested, be below 10%.  

"We could raise the rating if adjusted debt to EBITDA falls
sustainably below 4.5x, FFO to debt exceeds 15%, and FOCF to debt
is above 10%. This could be achieved if Connected Home's revenues
and profitability rebound beyond our expectations on strong
broadband and Android TV demand, combined with continued decline in
memory chip price. This, alongside stronger profitability on a
better mix in Entertainment Services, and lower restructuring
costs, would support stronger credit ratios."



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G E O R G I A
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TEGETA MOTORS: Fitch Affirms Then Withdraws 'B-' Long-Term IDR
--------------------------------------------------------------
Fitch Ratings has affirmed Georgian auto parts company Tegeta
Motors LLC's Long-Term Issuer Default Rating (IDR) at 'B-' with
Stable Outlook. The rating has simultaneously been withdrawn.

The rating of Tegeta Motors is constrained by its small scale, lack
of geographical diversification, negative free cash flow (FCF)
generation, and tight liquidity position. Positively the company
benefits from its leading market position in the local market and a
significant proportion of aftermarket-driven non-cyclical revenue
that helps to support profitability even in times of crisis.

The ratings were withdrawn with the following reason: For
Commercial Purposes

KEY RATING DRIVERS

Narrow but Stable Business Profile: Tegeta Motors operates in the
small and fragmented market of auto spare parts and aftermarket
services in Georgia. It is small compared with international peers
and has limited revenue diversification. However, this is partly
offset by its strong position in some of the segments it covers and
its large size in the local market. In addition, it derives a large
proportion of its revenue from spare parts and aftermarket services
sales, which are typically less sensitive to economic cycles.
Sustainability of demand for automotive repairs and car parts sales
is underpinned by over 80% of cars in Georgia being over 10 years
old.

Limited Diversification: Tegeta Motors' geographic diversification
is limited, as the company is primarily focused on Georgia with
more volatile economic conditions typical of emerging markets. The
Georgian automotive market is small, with a car park of around 1.2
million units (including trucks and light vehicles). Nevertheless,
Tegeta Motors plans to extend its presence in the Caucasus region
by investing via JVs with partners. The diverse range of product
types served by Tegeta Motors does not fully mitigate the exposure
of the automotive industry to adverse economic conditions and
volatile consumer demand. Sharp fluctuations of the automotive
industry could still significantly affect the company's business in
times of crisis.

Negative FCF: Fitch expects still negative FCF generation of about
1% in 2019 due to capex to expand Tegeta Motors's network. This is
likely to be primarily debt-funded given the company's limited cash
reserves and challenging liquidity position, although a material
portion of the expected capex is flexible and may be postponed.
Nevertheless, once capex slows and is accompanied with sustainable
revenue growth, FCF should turn positive.

Exposure to FX Risk: Tegeta Motors faces FX mismatch as practically
all its revenue is generated in Georgian lari, while around 70% of
operating costs are linked to foreign currencies, mainly to the US
dollar and euro. About 65% of debt at end-December 2018 was
denominated in foreign currencies (mainly US dollar and euro). The
company has started to use hedging instruments since 2017, enabling
it to minimise FX risk. The company's planned local currency bond
issue should also help address the FX exposure. Nonetheless, Tegeta
Motors, like all trading companies, remains exposed to FX risk in
the event of a sharp depreciation of the local currency.

DERIVATION SUMMARY

Tegeta Motors benefits from its leading market position in the
domestic market and the non-cyclical nature of its major sources of
revenue, the latter of which helps to support healthy profitability
even in times of crisis. However, the rating is limited by the
company's small scale, lack of geographical diversification,
negative FCF, and tight liquidity position. The business profile is
more exposed to cyclicality and operates in an industry with lower
barriers to entry than other Fitch-rated Georgian corporates such
as healthcare provider JSC Medical Corporation EVEX (B+/Stable) and
incumbent telecoms provider Silknet JSC (B+/Stable).

KEY ASSUMPTIONS

  - Annual revenue growth of around 10% on average over 2019-2022.


  - EBITDA margin remaining around 9% over 2019-2022 based on
historical data and Fitch's conservative view on profitability
growth potential. Competition in the market will cap profitability
at near current levels.

  - Capex in line with the company's guidance on expansion strategy
and enlarging the network, totalling up to GEL58 million over
2019-2022.

  - Dividends of about GEL5 million a year.

RATING SENSITIVITIES

Rating Sensitivities are not relevant since the rating has been
withdrawn.

LIQUIDITY AND DEBT STRUCTURE

Tight Liquidity: At end-2018 Tegeta Motors had GEL21 million of
cash on its balance sheet. Together with available undrawn bank
facilities of about GEL2.5 million with maturity of more than one
year, albeit uncommitted, it will still not be sufficient to cover
expected further negative FCF of about GEL4 million in 2019 and
short-term debt of about GEL41 million. However, the company is
planning to place a bond of GEL30 million, which should improve its
debt maturity profile and liquidity position.

High refinancing risk is somewhat mitigated by the good long-term
relationship Tegata Morors has with its key creditor, TBC Bank.
Fitch expects the current credit facilities will be further rolled
over.



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I R E L A N D
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ARBOUR CLO: Moody's Upgrades Class F Notes Rating to 'B1'
---------------------------------------------------------
Moody's Investors Service has upgraded the ratings of the following
notes issued by Arbour CLO Designated Activity Company:

EUR 26,250,000 Refinancing Class B-1 Senior Secured Fixed Rate
Notes due 2027, Upgraded to Aaa (sf); previously on Dec 16, 2016
Assigned Aa2 (sf)

EUR 19,950,000 Refinancing Class B-2 Senior Secured Floating Rate
Notes due 2027, Upgraded to Aaa (sf); previously on Dec 16, 2016
Assigned Aa2 (sf)

EUR 11,250,000 Refinancing Class C-1 Senior Secured Deferrable
Fixed Rate Notes due 2027, Upgraded to Aa3 (sf); previously on Dec
16, 2016 Assigned A2 (sf)

EUR 10,750,000 Class C-2 Senior Secured Deferrable Floating Rate
Notes due 2027, Upgraded to Aa3 (sf); previously on Jun 16, 2014
Definitive Rating Assigned A2 (sf)

EUR 19,750,000 Class D Senior Secured Deferrable Floating Rate
Notes due 2027, Upgraded to A3 (sf); previously on Jun 16, 2014
Definitive Rating Assigned Baa2 (sf)

EUR 12,125,000 Class F Senior Secured Deferrable Floating Rate
Notes due 2027, Upgraded to B1 (sf); previously on Jun 16, 2014
Definitive Rating Assigned B2 (sf)

Moody's has also affirmed the ratings of the following notes:

EUR 208,750,000 (current outstanding amount EUR 183,002,465)
Refinancing Class A Senior Secured Floating Rate Notes due 2027,
Affirmed Aaa (sf); previously on Dec 16, 2016 Assigned Aaa (sf)

EUR 26,675,000 Class E Senior Secured Deferrable Floating Rate
Notes due 2027, Affirmed Ba2 (sf); previously on Jun 16, 2014
Definitive Rating Assigned Ba2 (sf)

Arbour CLO Designated Activity Company, issued in June 2014 and
refinanced in December 2016, is a collateralised loan obligation
(CLO) backed by a portfolio of mostly European broadly syndicated
first lien senior secured corporate loans. The portfolio is managed
by Oaktree Capital Management (Europe) LLP. The transaction's
reinvestment period ended in July 2018.

RATINGS RATIONALE

The rating action on the notes are primarily a result of
deleveraging of the Class A notes following amortisation of the
underlying portfolio since the end of the reinvestment period in
July 2018, leading to improvement in over-collateralisation (OC)
ratios across the capital structure.

Class A notes have paid down by approximately EUR 25.7 million
since the end of the reinvestment period in July 2018. As a result,
the OC ratios for classes A/B, C, D and E, as of February 2019, are
reported at 148.53%, 135.52%, 125.64% and 114.38% respectively,
compared to 143.94%, 132.51%, 123.69% and 113.48%, as per the July
2018 report.

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 and principal proceeds balance of EUR 340.4 million,
a weighted average default probability of 21.6% (consistent with a
WARF of 2830 and weighted average life of 4.98 years ), a weighted
average recovery rate upon default of 43.6% for a Aaa liability
target rating, a diversity score of 42 and a weighted average
spread of 3.67%.

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. 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 analysing.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's Global
Approach to Rating Collateralized Loan Obligations" published in
March 2019.

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

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:

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.
Fast amortisation would usually benefit the ratings of the notes
beginning with the notes having the highest prepayment priority.

Weighted average life: The notes' ratings are sensitive to the
weighted average life assumption of the portfolio, which could
lengthen as a result of the manager's decision to reinvest in new
issue loans or other loans with longer maturities, or participate
in amend-to-extend offerings. The effect on the ratings of
extending the portfolio's weighted average life can be positive or
negative depending on the notes' seniority.

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.

HOUSE OF EUROPE IV: Fitch Affirms Class C & D Note Ratings at 'Csf'
-------------------------------------------------------------------
Fitch Ratings has affirmed House of Europe Funding IV PLC as
follows:

EUR1.3 million Class A1 notes (ISIN XS0228470588): affirmed at
'Asf'; Outlook Stable

EUR130 million Class A2 notes (ISIN XS0228472873): affirmed at
'CCsf'

EUR62.5 million Class B notes (ISIN XS0228474572): affirmed at
'Csf'

EUR5 million Class C notes (ISIN XS022847572): affirmed at 'Csf'

EUR49 million Class D notes (ISIN XS0228476197): affirmed at 'Csf'

EUR7.6 million Class E notes (ISIN XS0228477161): affirmed at
'Csf'

House of Europe Funding IV PLC is a managed cash securitisation of
structured finance assets, primarily RMBS and CMBS. The portfolio
is managed by Collineo Asset Management GmbH. The reinvestment
period ended in December 2010.

Fitch has affirmed the class A1 notes despite the current
ineligible account bank (Deutsche Bank). The rating of the notes is
currently one notch above Deutsche Bank's Deposit Rating. Fitch has
been informed that a novation is unlikely due to missing
documentation on the account bank agreement. In Fitch's opinion the
exposure to the account bank is limited given the small notional
remaining for the class A-1 notes. Fitch believes that the class
A-1 notes would be fully paid in the near future as they are
supported by high credit enhancement of 98.7 % and the portfolio
includes investment-grade assets, which cover the payment of the
remaining notional.

However, the class A-1 notes cannot be upgraded despite the high
credit enhancement due to payment interruption risk stemming from
the ineligible account bank. This would need to be addressed to
ensure the timeliness of the interest payments before an upgrade
can be considered to 'AAsf' and 'AAAsf'.

The affirmation of the class A2 notes at 'CCsf' (significantly
under-collateralised at present) reflects the probability of full
repayment only if sufficient recovery is received from the current
EUR56 million defaulted balance. The junior class B, C, D and E
notes have been affirmed at 'Csf' as their default is inevitable,
even assuming 100% recovery on defaulted claims.

KEY RATING DRIVERS

Counter Party Risk

The in eligible account bank restricts any upgrades to AAsf or
AAAsf.

Increased Credit Enhancement

Credit enhancement has significantly increased due to transaction's
deleveraging since July 2018. Credit enhancement for the class A1
notes increased to 98.7% from 87.6% based on the performing
portfolio. Since the last rating action in July 2018, the class A1
notes have been paid down by around EUR12 million through
repayments of assets and some recovery from defaulted assets. The
credit quality of the portfolio has slightly improved.

High Obligor Concentration

The portfolio is more concentrated with 19 performing assets versus
22 last year due to the natural amortisation of the portfolio.
Consequently, the largest asset exposure is now 20.8% of the
portfolio and the 10-largest issuers represent 87.8% of the
performing portfolio.

High Defaulted Asset Concentration

The defaulted assets still contribute around 36.9% of the total
portfolio. Only the senior class A1 notes are fully collateralised,
which means the interest payment on the rated notes balance of
EUR267 million is supported by only a performing portfolio of EUR96
million.

Cash Flow Analysis

Fitch has not performed cash flow modelling as the senior most
class A-1 notes have a very small notional left and are supported
by high credit enhancement. Fitch believes the notes are most
likely to be paid out in near future. The class A2 notes are
under-collateralised and the probability of their full payment
depends on recovery of defaulted assets as well as the performance
of other assets. For the remaining junior classes default is
inevitable.

RATING SENSITIVITIES

Neither a 25% increase in the obligor default probability or a 25%
reduction in expected recovery rates will impact the ratings of the
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

Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. There were no findings that were material to
this analysis. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.

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 information relied upon for the
agency's rating analysis according to its applicable rating
methodologies indicates that it is adequately reliable.

SYNCREON GROUP: S&P Downgrades ICR to CCC-, Outlook Negative
------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on syncreon
Group Holdings to 'CCC-' from 'CCC+', and lowered its issue ratings
on its senior secured term loan and unsecured notes.

S&P has downgraded syncreon given its view that a default event now
appears inevitable, in light of the group's high debt burden and
continued cash burn, although the timing of such an event remains
uncertain.

In early 2018, syncreon took several steps to improve its
liquidity, such as extending the maturity of its senior secured
revolving credit facility, amending covenants, and entering into a
new asset backed loan facility. These measures improved the
company's short-term liquidity profile such that syncreon now has
sufficient cash to cover its required debt payments in 2019.

However, these measures also increased the company's interest
costs, weighing on free cash flow. S&P expects free cash flow to be
significantly negative in 2019, for the third consecutive year. S&P
does not anticipate this situation will reverse in the medium term,
making a default, debt restructuring, or distressed exchange
inevitable, in its view.

The negative outlook reflects the high likelihood that, despite
sufficient liquidity to meet short-term obligations, syncreon will
experience a default event in the near term to address the
long-term sustainability of its capital structure, and that lenders
will ultimately receive less principal or interest than originally
promised.

S&P said, "Should syncreon launch a distressed exchange offer to
address its unsustainable capital structure, we would lower the
issuer credit rating to 'D' (default) or 'SD' (selective default),
after which time we would re-evaluate the prevailing capital
structure.

"We view a revision of the outlook to stable as unlikely, absent
unanticipated significantly favorable changes in the issuer's
circumstances. We would nevertheless revise the outlook to stable
or raise the ratings if it became clear that syncreon would not
enter into any debt restructuring, while maintaining sufficient
liquidity to meet its obligations."



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

GRUPO BANCARIO: Fitch Assigns 'BB' LT IDR, Outlook Stable
---------------------------------------------------------
Fitch Ratings has assigned Gruppo Bancario Cooperativo Iccrea
(ICBG) a Long-Term Issuer Default Rating (IDR) of 'BB' with Stable
Outlook, Short-Term IDR of 'B' and Viability Rating (VR) of 'bb'.

Fitch has also affirmed Iccrea Banca S.p.A.'s (IB) and its main
subsidiary Iccrea BancaImpresa S.p.A.'s (IBI) Long-Term IDRs at
'BB' with a Stable Outlook and withdrawn their 'bb' VRs.

On March 4, 2019 the ECB approved the establishment of ICBG, which
is not a legal entity but a cooperative banking group. It comprises
142 credit cooperatives, IB acting as a central bank, a specialised
bank subsidiary (IBI), and other entities. All group entities
signed a contract encompassing a cross-guarantee mechanism. Under
this mechanism, the central bank ensures viability of the
affiliated banks, redistributing capital and liquidity from
stronger members to support the weaker ones. Fitch  consequently
assigns group ratings in accordance with Annex 4 of its Bank Rating
Criteria and have the same IDRs for ICBG, IB and IBI.

KEY RATING DRIVERS

IDRS, VR AND SENIOR DEBT

ICBG's IDRs and VR reflect its strengthened franchise as Italy's
largest credit cooperative banking group and fourth-largest
domestic bank by total assets. The ratings are also underpinned by
the newly set-up group structure and risk governance framework,
which Fitch expects to result in more cohesive commercial and
strategic objectives among group entities as well as a strengthened
overall group risk appetite. The ratings also reflect the group's
weak asset quality, its modest core profitability, adequate
capitalisation and sound funding and liquidity.

Asset quality at ICBG is weak by international standards and
significantly lags the 10% domestic average at end-2018, despite
the reduction of non-performing loans (NPL) in 2018. Fitch expects
ICBG to further accelerate the pace of NPL disposals in 2019 and
2020 but its impaired loans ratio will remain higher than domestic
peers in the short term. In addition, the upcoming asset quality
review to be undertaken by the ECB could result in the recognition
of additional NPLs and loan impairment charges (LICs).

ICBG's core profitability is modest as a result of weak earnings
generation - this is also given the nature of mutual banks as
non-profit-oriented institutions - weak cost efficiency and
sizeable LICs, which erode a meaningful portion of pre-impairment
operating profit. Fitch expects core operating profitability to
gradually improve, mainly driven by asset quality improvement and
cost synergies. Improving revenue generation will prove challenging
given ICBG's less diversified business model compared with other
domestic peers, the low interest rate environment and stiff
domestic competition.

ICBG's capitalisation is adequate but is vulnerable to unreserved
NPL (estimated at 50% of its CET1 capital) as well as exposure to
Italian government bonds, which represent multiples of its CET 1
capital. Fitch believes that internal capital generation will
remain modest in the short term, mainly driven by weak revenue
generation.

ICBG's funding structure is adequate for the group's business
model, as loans are mainly funded by a granular retail deposits.
Wholesale funding channels are only partially utilised through the
central bank IB, but ICBG plans to capitalise on the large bulk of
residential mortgages to tap the secured funding market. Given its
size, Fitch would also expect ICBG to diversify its funding sources
through more frequent unsecured bond issuances. Fitch also expects
the group to continue make use of central bank funding (estimated
at 10% of total assets at end-2018).

Fitch has withdrawn IB's and IBI's common VRs as Fitch typically
does not assign VRs to banking group's central institutions or
specific banks, in line with Annex 4 of its Bank Rating Criteria.

SUPPORT RATING AND SUPPORT RATING FLOOR

ICBG's Support Rating (SR) of '5' and Support Rating Floor (SRF) of
'No Floor' reflect Fitch's view that although external support is
possible it cannot be relied upon. Senior creditors can no longer
expect to receive full extraordinary support from the sovereign in
the event that the bank becomes non-viable. The EU's Bank Recovery
and Resolution Directive and the Single Resolution Mechanism for
eurozone banks provide a framework for the resolution of banks that
requires senior creditors to participate in losses, if necessary,
instead of, or ahead of, a bank receiving sovereign support.

Fitch has also affirmed IB's SR and SRF at '5'/'NF' as it believes
that external support to ICGB (from example from the Deposit
Guarantee Scheme) is likely to be channelled through IB, as the
group's central institution. At the same time, Fitch has withdrawn
IBI's SR and SRF since it typically does not assign these ratings
to specific banks within the banking group, in line with Annex 4 of
the Bank Rating Criteria.

SUBORDINATED DEBT AND OTHER HYBRID SECURITIES

The subordinated debt issued by IB is notched off ICBG's VR. The
use of ICBG's VR as anchor rating reflects Fitch's view that ICBG
will collectively ensure that payments are met on these
instruments. IB's subordinated debt rating is one notch lower than
ICBG's VR to reflect the below average recovery prospects for the
notes given their subordinated nature. No additional notching was
applied for incremental non-performance risk as the write-down of
the notes will only occur only after the point of non-viability is
reached and there is no prior coupon flexibility.

RATING SENSITIVITIES

IDRS, VRS AND SENIOR DEBT

ICBG's ratings could be upgraded if the stock of NPLs is materially
reduced and the group shows it has good control of new NPL
generation, resulting in a reduction of its capital vulnerability
to unreserved NPLs. This would have to be accompanied by
maintaining sound capital ratios and improving operating
profitability.

Failure to reduce problem assets or weakening capital and
profitability could lead to a downgrade.

SR AND SRF

An upgrade of the SR and upward revision of the SRF would be
contingent on a positive change in the sovereign's propensity to
support the banks. In Fitch's view this is highly unlikely,
although not impossible.

SUBORDINATED DEBT

The rating on IB's subordinated debt is sensitive to changes in
ICBG's VR. The ratings are also sensitive to a widening of notching
if Fitch changed its assessment of the expected loss severity.

The rating actions are as follows:

Gruppo Bancario Cooperativo Iccrea

Long-Term IDR: assigned at 'BB'; Outlook Stable

Short-Term IDR: assigned at 'B'

VR: assigned at 'bb'

Support Rating: assigned at '5'

Support Rating Floor: assigned at 'No Floor'

Iccrea Banca S.p.A.

Long-Term IDR: affirmed at 'BB'; Outlook Stable

Short-Term IDR: affirmed at 'B'

VR: withdrawn at 'bb'

Support Rating: affirmed at '5'

Support Rating Floor: affirmed at 'No Floor'

Senior debt (including programme ratings): long- and short-term
ratings affirmed at 'BB'/'B'

Subordinated debt: long-term rating affirmed at 'BB-'

Iccrea BancaImpresaS.p.A.

Long-Term IDR: affirmed at 'BB'; Outlook Stable

Short-Term IDR: affirmed at 'B'

VR: withdrawn at 'bb'

Support Rating: withdrawn at '5'

Support Rating Floor: withdrawn at 'No Floor'



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

CARTESIAN RESIDENTIAL: Fitch Rates Class E Notes 'BB(EXP)sf'
------------------------------------------------------------
Fitch Ratings has assigned Cartesian Residential Mortgages Blue
S.A.'s (CRM Blue) notes expected ratings, as follows:

Class A notes: 'AAA(EXP)sf'; Outlook Stable

Class B notes: 'AA(EXP)sf'; Outlook Stable

Class C notes: 'A+(EXP)sf'; Outlook Stable

Class D notes: 'BBB+(EXP)sf'; Outlook Stable

Class E notes: 'BB(EXP)sf'; Outlook Stable

Class F notes: 'NR(EXP)sf'

Class S notes: 'NR(EXP)sf'

CRM Blue is a true-sale securitisation of prime Dutch residential
mortgages originated by the following originators: Quion 10 B.V,
Ember Hypotheken 1 B.V. (Ember 1) and Ember Hypotheken 2 B.V.
(Ember 2).

The portfolio (excluding one loan) was sold by GE Artesia Bank to a
sponsor group led by Venn Partners LLP in December 2013. The
purchaser of the portfolio - Ember VRM s.a.r.l. (Ember VRM) -
on-sold the majority of the mortgage receivables to Cartesian
Residential Mortgages 1 S.A. (CRM1). On the first optional
redemption date (FORD) of CRM1, the portfolio will be repurchased
by Ember VRM, which will in turn sell all loans excluding loans in
arrears of more than 30 days plus EUR3 million of additional loans
to CRM Blue.

KEY RATING DRIVERS

Seasoned but Higher-Risk Portfolio

The portfolio exhibits an average loan seasoning of 14 years and
has performed in line with Fitch's expectations. The percentage of
self-employed borrowers (24.7% by current balance) is higher than
typically seen for Dutch RMBS.

The loans were predominantly originated between 2004 and 2008.
These legacy loan pools display weaker characteristics than peers,
such as a higher percentage of interest-only (IO) loans and a
significant share of borrowers with an original
loan-to-market-value (OLTMV) of higher than 110%.

Interest Rate Risk

The portfolio consists of 49.6% floating-rate loans (43.5% linked
to three months (3m) Euribor and 6.1% to a standard variable bank
rate) and 50.4% fixed-rate loans. Mismatches between the fixed-rate
loans and the notes (linked to 3m Euribor) are hedged through a
swap with NatWest Markets Plc.

CRM Blue faces reset risk on loans with the majority of resets
within four years after the issue date of the notes. Fitch has
applied its criteria assumptions for product switches and reset
margins to address this risk. Limited consideration was given Ember
VRM's interest rate reset policy given the reset risk is
front-loaded.

Non-Bank Seller, Established Sub-Servicer

Venn Partners has managed the securitised portfolio since the 2013
transfer and Quion (RPS2+/RSS2+) has acted as sub-servicer since
then.

VARIATIONS FROM CRITERIA

Fitch has observed over the life of the mortgage pool a reset
policy that offers higher fixed mortgage reset rates than prime
mortgage peers. This resulted in higher prepayments as borrowers
are incentivised to refinance with competitors. Based on these
historical observations and given a very frontloaded reset profile,
Fitch has applied a higher margin upon reset (3%) over the first
year, which is a variation to Fitch's European RMBS Rating
Criteria. For the low prepayment scenario, Fitch increased its
assumption for the first year to 10%, based on historical
prepayment observations. This is also a variation to its European
RMBS Rating Criteria.

RATING SENSITIVITIES

Material increases in the frequency of defaults and loss severity
on defaulted receivables producing losses greater than Fitch's base
case expectations may result in negative rating action on the
notes. Fitch's analysis revealed that a 15% increase in the
weighted average (WA) foreclosure frequency, along with a 15%
decrease in the WA recovery rate, would imply a downgrade of the
class A notes to 'AA-sf', class B notes to 'A+sf', the class C
notes to 'BBB+sf', the class D notes to 'BB+sf' and the class E
notes to 'B-sf'.

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

Fitch reviewed the results of a third-party assessment conducted on
the asset portfolio information at transaction closing of CRM1,
which indicated errors or missing data related to the property
value information. These findings were considered in this analysis
by reducing the market value for 2% of the total pool by 15% in its
asset analysis to account for these errors, as set out more fully
in the presale report.

Overall and together with the assumptions, 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.

PRECISE MIDCO: Moody's Assigns B3 CFR, Outlook Stable
-----------------------------------------------------
Moody's Investors Service has assigned a B3 corporate family rating
(CFR) and B3-PD probability of default rating (PDR) with a stable
outlook to Dutch enterprise software provider Precise Midco B.V.
('Exact') following the company's announcement of a new EUR675
million debt financing. Proceeds of the new facilities will be used
alongside equity to fund the acquisition of Exact by financial
sponsor KKR and pay transaction fees.

The rating assignments reflect primarily the very high February
2019 adjusted leverage of 8.4x pro-forma for the proposed
refinancing, despite EBITDA-driven deleveraging potential and
positive free cash flow (FCF) generation.

Concurrently, Moody's has assigned B2 ratings to the proposed
EUR450 million senior secured first lien term loan B1 maturing in
2026 and pari passu ranking EUR50 million RCF maturing in 2025,
borrowed by Precise Bidco B.V., which carries a stable outlook.
Exact's ratings for its existing capital structure, assigned at
Eiger Midco B.V. and Eiger Acquisition B.V., remain unchanged and
will be withdrawn upon closing of Exact's acquisition by KKR and
full repayment of the existing debt facilities.

RATINGS RATIONALE

"Despite a material equity cushion alongside it, we believe that
Exact's new debt capital structure is aggressive and characterised
by very elevated Moody's adjusted leverage well above 8.0x as of
February 2019" says Frederic Duranson, a Moody's Assistant Vice
President and lead analyst for Exact. "Adjusted leverage will
remain high for the next 12 to 18 months and above the 6.0x
requirement for a B2 which is set for Exact's current ratings,
despite expected continued solid growth in EBITDA in the low double
digits annually in percentage terms in 2019-2020. Moody's  expects
that free cash flow (after interest) will be positive and improve
towards 5% of adjusted debt in 2019-2020", Mr Duranson adds.

In 2017 and 2018, Exact grew revenues and EBITDA (before one-off
items) by double digits annually in percentage terms, allowing the
group to delever by around a turn in 2018 from a high 6.3x Moody's
adjusted leverage at the time of refinancing in Q4 2017. The EBITDA
margin has also grown by more than one percentage point in 2018,
reflecting the restructuring efforts following the divestment of
the US-focused Specialized Solutions segment in Q4 2017. Moody's
believes that Exact has deleveraging potential based on its track
record of earnings growth, however the rating agency does not
currently anticipate that the group will sufficiently delever in
the next 12-18 months to achieve the requirements for a B2 CFR.
Moody's forecasts that adjusted leverage will remain well above
7.0x in 2019 and above 6.5x in 2020.

Moody's view on leverage takes into account (1) the group's lack of
sustainable reduction in Moody's adjusted gross debt/EBITDA under
private equity ownership before 2018, albeit with a different
scope, (2) the historically low EBITDA growth in Mid-Market
Solutions, which generates more than two thirds of the group's
EBITDA, (3) reduced levels of churn in line with the rated peer
group while Moody's forecasts a deterioration in GDP growth in the
Netherlands in 2019-2020 to below 2.0% p.a. from an estimated 2.5%
in 2018, and (4) some drag on EBITDA from management's estimate of
EUR2.7 million stranded costs resulting from the hibernation of the
international cloud business.

However, Moody's forecasts of Exact's future adjusted leverage are
also informed by (1) the good visibility on 2019 EBITDA, supported
by high recurring revenues of 88% (including maintenance and
subscriptions), (2) recent price increases in online bookkeeping
product, (3) acquisitions made in 2018 in Mid-Market Solutions, and
(4) certain costs savings initiatives, which will all have a full
12 months benefit in 2019's profits.

Exact's credit profile is constrained by its limited size and
geographic concentration on the Netherlands, a higher level of
churn in its cloud business than the rest of the group, and the
risk of debt-funded acquisitions and/or shareholder distributions.
These factors are balanced by the group's scale in its domestic
market of the Benelux.

The group recorded renewed free cash flow (FCF) generation in 2018,
which was in the range of EUR10-15 million, pro forma for a full
year of interest payment under the proposed capital structure. By
end 2019 and 2020, Moody's anticipates that Exact will raise FCF
generation to around EUR30 million per annum, with FCF/adjusted
debt moving towards 5%.

Exact's liquidity is adequate. Although the transaction is not
expected to leave any cash on balance sheet at closing, the group
will build internal liquidity resources thanks to positive FCF
generation. Exact's liquidity will also be supported by its new
EUR50 million RCF, which is expected to remain undrawn at closing.
It matures in 2025 and is subject to a springing financial covenant
for the benefit of RCF lenders only, which requires net secured
leverage to remain below 8.75x and will be tested if the RCF is
drawn by more than 40%.

The B2 ratings on the new EUR450 million senior secured first lien
term loan B1 maturing in 2026 and pari passu ranking EUR50 million
RCF maturing in 2025, one notch above the CFR, reflect their
priority ranking ahead of the new EUR175 million senior secured
second lien facility.

RATIONALE FOR STABLE OUTLOOK

The stable outlook reflects Moody's expectation that Exact will (1)
maintain good momentum in revenue and EBITDA growth, without
increases in churn, (2) not make any material debt-funded
acquisitions or shareholder distributions, such that Moody's
adjusted leverage will reduce and FCF/debt will average around 5%
per annum in the next 12 to 18 months.

WHAT COULD CHANGE THE RATING UP/DOWN

Positive pressure on the ratings could develop if Exact records
growth in Moody's adjusted EBITDA, leading to Moody's adjusted
leverage declining sustainably to around 6.0x and FCF/debt above
5%. Any positive rating action would also hinge on the absence of
material debt-funded acquisitions or shareholder distributions.

Conversely, negative pressure on the ratings could materialise if
(1) revenues and EBITDA did not grow organically or churn
increased, or (2) Moody's adjusted leverage did not reduce towards
7.5x within 18 months, or (3) FCF generation became negative.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Software
Industry published in August 2018.

Founded in 1984 and headquartered in Delft, the Netherlands, Exact
is an enterprise resource planning (ERP) and accounting software
provider for SMEs with up to 500 employees. The company has over
400,000 clients, which include accountancy firms (6,700+),
mid-market businesses (18,500+) and small businesses (400,000+),
located primarily in the Netherlands and the rest of the Benelux.
In the year ending December 2018, the restricted group generated
revenue of EUR205 million and EBITDA before exceptional items of
EUR69 million and employed c. 1,500 staff. Exact is in the process
of being acquired by funds controlled and advised by KKR.

Exact is organised along two business segments: (1) Mid-market
Solutions ("MMS"), which provides ERP solutions to mid-market
clients along a traditional on-premise (license/maintenance or
subscriptions) business model and (2) Small Business and
Accountants (SB&A), which provides accountancy and
industry-specific ERP solutions along a cloud-based subscription
model.



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

NAVIGATOR COMPANY: S&P Alters Outlook to Pos., Affirms BB LT ICR
----------------------------------------------------------------
S&P Global Ratings revised the outlook on The Navigator Company
(Navigator) to positive from stable. S&P affirmed its ratings on
Navigator, including its 'BB/B' long- and short-term issuer credit
ratings. S&P are also revised upward Navigator's stand-alone credit
profile to 'bbb-' from 'bb+'.

The positive outlook on Navigator reflects S&P's view that there is
at least a one-in-three chance that the parent company, Semapa
S.A., will continue to show financial discipline, and further
improvements in Navigator's strong cash generation could improve
our financial risk assessment of Semapa's group credit profile
(GCP).

Semapa's S&P Global Ratings-adjusted funds from operations (FFO) to
debt increased to 28% in 2018 from 24% in 2017. Semapa's adjusted
debt to EBITDA improved to 2.9x in 2018 from 3.5x in 2017. S&P
expects Semapa to further reduce debt in 2019, with FFO to debt of
about 34% and adjusted leverage of about 2.4x.

S&P said, "Despite our upward revision of Navigator's stand-alone
credit profile (SACP) to 'bbb-', we are affirming our 'BB' issuer
credit rating on Navigator because it remains capped by the
parent's GCP of 'bb'. The consolidated Semapa has higher leverage
and lower profitability than Navigator on a stand-alone basis.

"On Dec. 31, 2018, Navigator's adjusted debt to EBITDA was 1.7x and
FFO to debt was 47%. Over the next two years, we expect these
credit metrics to improve further; we expect adjusted debt to
EBITDA to reduce to 1.5x and FFO to debt to exceed 50%. These
ratios are consistent with a modest financial risk profile.

"Navigator's credit metrics are comfortably entrenched in our
modest financial risk profile assessment. They provide Navigator
with some leeway to absorb the effect of potentially lower pulp and
paper prices or higher investments. We believe that Navigator's
leverage will remain below its publicly stated maximum leverage of
2.0x (similar on an S&P Global Ratings-adjusted basis).

"Our assessment of Navigator's business risk profile reflects its
market position as Europe's largest uncoated wood free (UWF) paper
producer. Our assessment also considers Navigator's strong profit
margins, which reflect its well-invested, modern asset base, high
capacity utilization, focus on premium paper grades, vertical
integration into hardwood pulp, full degree of energy
self-sufficiency, and relatively low labor costs.

"In 2018, pulp prices increased by 21% and paper prices rose by
8.5%. This supported revenues and offset the impact of adverse
foreign exchange movements and slightly lower volumes caused by
production stoppages. Damage caused by Hurricane Leslie stopped
production at the Figueira da Foz site for a week, and prolonged
maintenance and unplanned stoppage hindered paper production at the
Setubal mill. In 2019, we expect average pulp and paper prices to
be below those achieved in 2018."

Navigator continues to expand its tissue operations and is now the
third-largest tissue producer in Iberia. However, tissue operations
only account for 5% of total sales. This will further reduce
Navigator's exposure to the structurally declining UWF paper
segment.

Navigator's business risk profile is constrained by the cyclical
and competitive nature of the paper and pulp industry, its small
size, its reliance on two paper mills, and narrow product range.
Office paper accounts for 73% of revenues; the rest relates to
pulp, tissue, and energy.

The combination of a fair business risk profile and a modest
financial risk profile results in a 'bbb-' anchor for Navigator.

S&P said, "We continue to view Navigator as strategically important
for Semapa, which owns 69% of Navigator's shares and 69.4% of the
company's voting rights. We assess Semapa's GCP as 'bb'. Although
we view Navigator's SACP at 'bbb-', our issuer credit rating on
Navigator is capped by Semapa's credit assessment. Semapa is a
conglomerate operating in the cement segment (Secil Co.), pulp and
paper (Navigator), and waste management (ETSA). In our view, Semapa
has weaker credit metrics than Navigator, primarily because of its
higher leverage and the lower profitability and the
creditworthiness of its other businesses--notably Secil, which
contributes about 20% of Semapa's EBITDA." Navigator contributes a
substantial proportion of Semapa's revenues and profits--75% of
sales and 80% of EBITDA. Semapa relies on Navigator's dividends to
service its own debt.

The positive outlook on Navigator reflects that there is at least a
one-in-three likelihood that we could raise the rating on Navigator
in the coming 12 months.

An upgrade of Navigator would be contingent on us revising upward
Semapa's GCP to 'bb+'.

S&P said, "We could revise upward Semapa's GCP if Semapa continues
to show financial discipline and Navigator's strong cash generation
continues to improve our financial risk assessment of Semapa, such
that Semapa's debt to EBITDA drops below 3.0x and FFO to debt rises
above 30% on a sustained basis.

"We could revise the outlook on Navigator to stable if we observe
an increase in Semapa's financial risk, with additional debt-funded
investments, extraordinary dividends, or share buybacks causing
debt to EBITDA to rise above 3.0x and FFO to debt to drop below 30%
on a sustained basis.

"We could also revise the outlook to stable if Navigator's EBITDA
margins and cash generation deteriorated materially. This would
also harm Semapa's performance and GCP. This could stem from an
economic decline, coupled with input cost inflation, or an
operational issue at one of Navigator's mills in Portugal."




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

ABSOLUT BANK: Moody's Confirms B2 LT Deposit Ratings, Outlook Neg.
------------------------------------------------------------------
Moody's Investors Service confirmed the B2 long-term local and
foreign currency deposit ratings of Absolut Bank (PAO) ("Absolut");
its senior unsecured debt rating of B2; its long-term counterparty
risk assessment (CR Assessment) of B1(cr) and its long-term
counterparty risk ratings (CRRs) of B1. At the same time, Moody's
downgraded the bank's baseline credit assessment (BCA) and adjusted
BCA to b3 from b2. The bank's short-term deposit ratings and CRRs
of Not Prime as well as short-term CR Assessment of Not Prime(cr)
were not affected by this action. The outlook was changed to
negative from ratings under review. This action completes the
reviews for downgrade that Moody's opened on November 21, 2018.

Absolut is the parent bank of a group, which includes subsidiary
Baltinvestbank, a bank under financial rehabilitation since 2015.
All the financial indicators for Absolut mentioned in this press
release refer to the group's consolidated financials, unless
otherwise specified. Absolut is ultimately controlled by the
non-state pension fund Blagosostoyanie.

Concurrently, Moody's affirmed Baltinvestbank's Caa1 long-term
local and foreign currency deposit ratings, its long-term CR
assessment of B3(cr) and long-term CRRs of B3. At the same time,
Moody's downgraded the bank's BCA to caa3 from caa2 and its
adjusted BCA to caa2 from caa1. The bank's short-term deposit
ratings and CRRs of Not Prime as well as short-term CRA of Not
Prime(cr) were not affected by this action. The outlook remains
stable.

Moody's rating action on the two banks is driven by the recent
weakening of their solvency profiles, which is compensated by
incorporating a moderate probability of government support into
both banks' deposit ratings.

RATINGS RATIONALE

Absolut Bank

The downgrade of Absolut's BCA reflects its slim capital cushion,
as well as its recent asset quality deterioration and resultant
losses.

According to audited IFRS financials, in H2 2018 the group's
problem loan ratio increased to 25.6% from 18.1%. The group's
consolidated capital adequacy metrics have been depleted following
the provisioning against Baltinvestbank's problem loans in 2017 as
well as further sizeable loan loss provisions last year (6.8% of
average gross loans). The group's net loss of RUB7.5 billion in H2
2018 negated the positive impact of a RUB6 billion capital
injection from Blagosostoyanie Fund in August 2018. On Moody's
estimates, the group's ratio of tangible common equity to
risk-weighted assets (TCE / RWA ratio) stood at just 0.6% as of
year-end 2018, virtually unchanged from 0.8% as of June 30, 2018.

Management expects third-party support to result in a significant
accounting gain for the group, which together with a planned RUB6
billion capital injection from Blagosostoyanie Fund in Q2 2019
would bring the TCE / RWA ratio to about 9% by year-end 2019, on
Moody's estimates. The details of this support are due to be
finalized by the end of 2019.

At the same time, the confirmed long-term deposit ratings and
senior unsecured ratings at B2 incorporate Moody's assessment of a
moderate probability of government support, given that (1)
following the incorporation of Blagosostoyanie Fund in late 2018,
the government of Russia (Baa3 stable) has become Absolut's
indirect ultimate owner, and (2) Absolut's significant subsidiary
Baltinvestbank is a recipient of government support in the form of
a financial rehabilitation package funded by the Deposit Insurance
Agency (DIA) and the Central Bank of Russia (CBR).

The negative outlook is driven by (1) the prolonged uncertainty
with respect to the size and timing of third-party capital support,
and (2) the bank's unproven ability to stabilize its asset quality
and restore profitability to ensure a stable capital position going
forward.

Baltinvestbank

The downgrade of Baltinvestbank's BCA and Adjusted BCA reflects a
further deepening in the bank's tangible common equity deficit,
which was RUB17.3bn as of mid-2018.

The affirmation of Baltinvestbank's long-term ratings reflects
Moody's expectations that in the next 12-18 months the bank's
financial profile will remain weak, with its tangible common equity
negative. The affirmed ratings also reflect the bank's status as a
bank operating under the regulatory forbearance regime and its
improved liquidity and funding profile owing to a substantial
financial rescue package from the state Deposit Insurance Agency
(DIA). The ratings now incorporate a moderate probability of
government support, in addition to a moderate probability of
affiliate support, which reflects Baltinvestbank's status as a
recipient of the financial rehabilitation package funded by the DIA
and the CBR.

WHAT COULD MOVE RATINGS UP/DOWN

Absolut Bank

An upgrade of Absolut's deposit ratings is currently unlikely,
given the negative outlook. However, the outlook may be changed to
stable, if (1) the proposed capital support from a third party
comes in a timely manner and in an amount sufficient to cover the
current capital shortfall; (2) the bank's asset quality stabilizes;
and (3) its profitability is restored.

Absolut's ratings may be downgraded if third party capital support
does not arrive and no other action is taken in the next 12 months
to significantly improve the bank's capital position. Further
significant bottom-line losses, eroding the bank's capital
position, may also result in a downgrade.

Baltinvestbank

Baltinvestbank's BCA could be upgraded if the bank were successful
in restoring profitability and improving asset quality.

Baltinvestbank's BCA could be downgraded in the event of additional
significant problem assets and losses further eroding its capital
position.

PRINCIPAL METHODOLOGY

The principal methodology used in these ratings was Banks published
in August 2018.

LIST OF AFFECTED RATINGS

Absolut Bank (PAO)

Downgrades:

Baseline Credit Assessment, Downgraded to b3 from b2

Adjusted Baseline Credit Assessment, Downgraded to b3 from b2

Confirmations:

LT Bank Deposits, Confirmed at B2, Outlook Changed to Negative from
Ratings Under Review

LT Counterparty Risk Rating, Confirmed at B1

LT Counterparty Risk Assessment, Confirmed at B1(cr)

Senior Unsecured Regular Bond/Debenture, Confirmed at B2, Outlook
Changed to Negative from Ratings Under Review

Outlook Action:

Outlook Changed to Negative from Ratings Under Review

Baltinvestbank

Downgrades:

Baseline Credit Assessment to caa3 from caa2

Adjusted Baseline Credit Assessment to caa2 from caa1

Affirmations:

LT Bank Deposits, Affirmed Caa1, Outlook Remains Stable

LT Counterparty Risk Rating, Affirmed B3

LT Counterparty Risk Assessment, Affirmed B3(cr)

Outlook Action:

Outlook Remains Stable

ETALON LENSPETSSMU: S&P Affirms 'B+/B' Rating on Leader Invest Deal
-------------------------------------------------------------------
S&P Global Ratings affirmed its 'B+/B' ratings on Etalon
LenSpetsSmu (LSS).

S&P said, "The affirmation reflects our view that LSS' stand-alone
creditworthiness has not changed after its parent company Etalon
Group acquired 51% in another Russian developer Leader Invest in
February 2019 from its previous 100% shareholder Sistema AFK.

"We understand that LSS' role within Etalon Group has not changed
following the acquisition. LSS remains an integral part of the
group, representing about 50%-60% of group revenue and about half
of its EBITDA pro forma Leader's acquisition, as per our estimates.
We expect the group will continue demonstrating commitment to
supporting LSS under any circumstances.

"Following the acquisition, we continue to assess the group credit
profile at 'b+'. We anticipate that higher EBITDA pro forma
Leader's consolidation in Etalon Group should partly balance the
leverage increase resulting from a Russian ruble (RUB) 15.2 billion
(about $235 million) five-year loan drawn by Etalon Group to fund
the acquisition that was provided by Sberbank. We estimate that
Leader's EBITDA will increase the group's consolidated EBITDA by
about one-third in 2019, while increasing debt by about 25% at the
group level. As a result, we expect Etalon Group's S&P Global
Ratings-adjusted debt to EBITDA to remain close to or below 3.0x in
2018-2020 (compared with 1.6x at end-2017).

"We believe that the transaction has enhanced Etalon Group's
position in the very competitive Russian development market and
increased its footprint in the Moscow market. Following the
acquisition, Etalon Group's net selling area has expanded by 32.2%
to 4.03 million square meters (sqm), with 61% in Moscow (38%
before), 34% in St. Petersburg (55% before), and 5% in the Moscow
region (7% before). According to management, Etalon Group now is
No. 1 in terms of number of projects on the market (28 projects
compared with PIK's 25), and is No. 2 in terms of volume under
construction. That said, the group significantly lags behind market
leader PIK, which has 3,629,000 sqm compared with Etalon Group's
732,000 sqm, according to Etalon Group. Furthermore, we note that
the group's share of the business segment--which is an industry
classification commonly used in Russia for an intermediate level of
construction quality and amenities--has increased to 30% from 15%
previously after Leader's acquisition.

"Importantly, we expect that the consolidated group will
demonstrate stronger profitability supported by Leader's
historically strong margins of about 30% (although we estimate that
they deteriorated to 20% in 2018 and will recover thereafter). This
compares with Etalon Group's S&P Global Ratings-adjusted EBITDA
margin of 15.7% in 2016 and 22.3% in 2017. We expect some operating
synergies, in particular due to strong construction capabilities of
Etalon Group, whose positive track record in the market
substantially exceeds that of Leader. We factor in that the
management expects RUB0.7 billion-RUB1.1 billion of annual
operating synergies (about 0.8-1.1% of revenue) to be derived from
optimization of construction, administrative, selling, and finance
expenses. This said, we believe that the integration of the two
companies--including alignment of budgeting, treasury management,
and marketing processes--will take time.

"We fully factor into our credit assessment the uncertainty related
to changing industry regulation for homebuilders and developers in
Russia. Starting from mid-2019 all Russian developers should use
project finance lines to replace homebuyers' down payments, whereas
homebuyers' cash will be maintained in escrow accounts until
project completion (except for projects that have reached a certain
stage of completion to be defined by the regulator). As a result of
gradual accumulation of project finance debt by developers, we
expect leverage to build up across the industry, including for
Etalon Group. There is a lot of uncertainty about the final shape
of the regulation at this stage, and we will reassess the impact of
the regulatory changes on the group's metrics as and when
uncertainty subsides.   

"We do not expect any change of Etalon Group's financial policy in
the near term, despite that fact that Sistema AFK, in addition to
selling its 49% stake in Leader to Etalon Group, has purchased a
25% stake in Etalon Group PLC from its founding shareholder Mr.
Zarenkov and his family. Sistema has become the largest minority
shareholder of Etalon Group and is now represented by two directors
on Etalon Group's board (out of 11), one of whom has become the
chairman. We view positively the fact that the number of
independent directors has been increased to six from four
previously. We understand that the change in shareholding structure
should not result in the near-term amendment of the group's
financial policy, including its dividend payout, which assumes
40%-70% of annual net profit paid semiannually. After
implementation of the current dividend policy, Etalon Group
distributed 48%-51% of its annual net income for 2016 and 2017.

"The stable outlook reflects our view that LSS' track record of
prudent financial management should help it to withstand any
adverse impacts from ongoing changes in the regulation of the real
estate development industry in Russia. We assume that the company's
management will continue its disciplined policy of working capital
liquidity management. We expect LSS' debt to EBITDA will not exceed
the threshold of 3x for the current rating, with EBITDA cash
interest coverage remaining at more than 3x.

"We also assume that Etalon Group's strengthened competitive
position and operating performance will mitigate the leverage
increase from the Leader acquisition. We also expect that Etalon
Group will maintain prudent financial management, despite the
changes in its shareholding structure. We expect Etalon Group's
debt to EBITDA will not exceed the threshold of 3x in 2018-2020,
with EBITDA cash interest coverage remaining above 3x.

"Furthermore, we expect that Etalon Group will maintain solid
access to financing sources, including project finance loans, and
that its liquidity will remain adequate.

"We could lower our rating if LSS or Etalon Group does not maintain
its credit metrics in line with an aggressive financial risk
profile, with debt to EBITDA exceeding 3x and EBITDA cash interest
coverage declining and remaining significantly below 3x. This might
happen if the company's investments in further expansion or
dividend payout lead to higher debt accumulation than we expect. We
might also lower the rating if LSS or Etalon Group are unable to
maintain their adequate liquidity, which could be the case if they
do not refinance their upcoming maturities in advance, or if there
is less availability under undrawn long-term lines and cash
balances decrease.

"The likelihood of an upgrade is currently remote, but could follow
successful integration of Leader, which would result in sustainable
revenue growth and margin improvement. Rating upside might also
come from a more conservative financial policy, specifically a more
prudent debt-to-EBITDA and dividend payout ratio. A positive rating
action also hinges on LSS' ability to consistently generate
materially positive free operating cash flow (FOCF)."

O1 PROPERTIES: S&P Alters 'CCC' ICR Outlook to Developing
---------------------------------------------------------
S&P Global Ratings revised its CreditWatch implications for its
'CCC' issuer credit rating on O1 Properties and its 'CCC-' issue
rating on its debt to developing from negative.

On March 15, 2019, O1 announced that it has obtained bondholders'
consent to waive application of the change of ownership clause,
which would trigger immediate redemption of all debt (a change of
ownership took place in July 2018 when private company Riverstretch
Trading and Investments became the major shareholder of O1). S&P
said, "We have revised our CreditWatch implications, given our view
that this marks a milestone in O1's capital restructuring and
partly reduces its liquidity risk. That said, we still see material
uncertainty as to the likelihood that O1 will soon succeed in
removing near-term liquidity risk."

S&P understands that the bond indenture has been modified to
strengthen the position of investors, including the presence of
independent directors on O1's board of directors and introduction
of an escrow account where cash for interest repayment will be
accumulated.

Nevertheless, liquidity risk remains material, because O1 has yet
to obtain consent from other lending banks to waive the change of
ownership clause (in particular, from the lenders to $175 million
mezzanine loan, which was taken over from O1's previous
shareholder). Moreover, O1 faces the risk of breaching maintenance
covenants for this loan, and S&P understands it is currently
negotiating a waiver. An event of default under this loan would
trigger a cross-default with the $350 million Eurobond.

S&P said, "Furthermore, we believe that the risk of debt
restructuring over the next six to 12 months remains high for O1,
given our forecast of negative funds from operations in 2018-2019.
We understand that O1 has already made some modifications to its
bilateral secured bank loans, which include the change of loan
currency and a tenor extension. We understand that these
modifications were based on market interest rates and did not
result in change of collateral for these loans. Still, O1 is
considering additional changes to its bank loans, and the terms and
conditions have yet to be finalized. Depending on the outcome, we
may view any debt maturity extension as de facto restructuring. If
debt is extended without adequate investor compensation, such as an
amendment fee or increased coupon, we would likely consider the
maturity extension a distressed exchange and akin to default.
Furthermore, in a hypothetical scenario of forced conversion of
debt into rubles without adequate compensation of lenders, we would
consider such a conversion a distressed exchange."

Positively, if near-term maturities are rescheduled with proper
investor compensation, and all waivers are obtained, the liquidity
risk pertaining to O1's significant debt portfolio would decrease.
This could result in a possible upgrade of O1.

S&P said, "Nevertheless, strong rating upside is contained by our
view of O1's capital structure as unsustainable in 2019, in the
absence of a significant favorable change. We forecast O1's
debt-to-debt-plus-equity ratio will hover at about 85% in
2018-2019, which is among the highest in its peer group in Europe,
Africa, and the Middle East. We understand that O1 is at risk of
breaching its loan-to-value and debt service coverage covenants for
the mezzanine loan, and has approached lenders to relax its
covenant package. We understand O1 expects to receive lenders'
decision in the next two months.

"We continue to rate O1's senior unsecured bonds one notch below
the issuer credit rating, since they rank behind a significant
amount of secured debt (representing about 70% of debt by our
estimates). O1's reported capital structure consisted of $2,240
million of secured debt and $855 million of unsecured debt as of
June 30, 2018 (the most recent reporting period).

"We expect to resolve the CreditWatch within the next two months,
after obtaining more clarity on whether the lending banks will
waive the change of control clause and breach of covenants, after
receiving more information about the final terms and conditions of
the debt reprofiling, and after reassessing the company's capacity
to service its debt.

"We would downgrade O1 if it restructures its debt in such a way
that investors receive less value than originally promised. We
would also downgrade O1 if it fails to obtain the waiver on the
ownership change or breach of covenants. In addition, we may
consider a downgrade if unfavorable market conditions further
weaken the company's credit metrics to levels no longer
commensurate with the current rating.

"Conversely, we would upgrade O1, likely by one notch, if the
company successfully executes its debt restructuring, and near-term
liquidity risk and risk of distressed exchange are removed.
Although unlikely at this stage, we would upgrade O1 to 'B-' if its
debt-to-debt-plus-equity ratio approaches 75% on a sustainable
basis and interest coverage is not less than 1.5x, while
maintaining adequate liquidity. Adequate liquidity would require a
feasible plan to repay or refinance its significant maturities due
in 2020-2021."

PIK GROUP: S&P Hikes Rating to B+ on Tightened Financial Policy
---------------------------------------------------------------
S&P Global Ratings raised its rating on PIK Group to 'B+ from 'B'.

S&P said, "We raised the rating because we think PIK Group will
adhere to a relatively prudent financial policy, which should allow
it to maintain its S&P Global Ratings-adjusted leverage below 3x-4x
in 2019-2020. We previously assessed the company's financial policy
as negative, largely because of its debt-financed acquisition of
Morton, which pushed PIK Group's S&P Global Ratings-adjusted
leverage to 5.9x at year-end 2016 and 4.3x at year-end 2017."
Morton is now integrated into the PIK Group, and the company has
stated it does not contemplate any other sizable M&A transactions
in the near future.

PIK Group's financial policy, which it adopted in 2017, assumes
dividend payout of at least 30% of operating cash flows, but it
also provides for cash requirements for debt repayment, compliance
with covenants, and capital spending needs for the company's
development. S&P said, "We believe that the company will be able to
manage higher dividend payout starting from 2018 while still
keeping leverage within our boundaries for the 'B+' rating. As a
result, we are changing our financial policy assessment for PIK
Group to neutral from negative."

The upgrade follows PIK Group's positive operating results in 2018,
with new contract sales up by 6% year on year (yoy) by volume and
11% by value. Importantly, cash collection increased by 17% yoy,
partly thanks to price increases (6% yoy in 2018) on the back of
solid demand fueled by mortgage availability (the Russian mortgage
rate reached a historical low of around 9.5% in 2018). S&P also
factors in a 17% increase in new selling area put on sale in 2018,
bringing the total selling area to 2.5 million square meters (m2)
in 2018. This is partly balanced by a 4% decline in completions in
2018 to 1.980 million m2 from 2.059 million m2 in 2018.

S&P said, "We believe that operational improvements should create a
buffer and partly offset the expected leverage increase stemming
from higher use of project finance debt starting from mid-2019, in
line with new regulatory requirements applicable to all property
developers operating in Russia. These loans would be used instead
of homebuyers' down payments to finance construction projects,
whereas homebuyers' cash would be kept in escrow accounts until the
project's completion. Although we think the new regulation will
increase the market's transparency in the medium term, we envisage
increased leverage for all industry players, including PIK Group.

"On a positive note, project finance loans are expected to have
lower interest rates than other bank debt. We understand that PIK
Group has already signed its first project finance contracts at a
beneficial rate, with rates to be adjusted down if the cash in
escrow accounts accumulates faster than drawdowns on these loans.
We understand that PIK Group has already used Russian ruble (RUB)
3.1 billion (about US$48 million) of project finance lines of
RUB61.3 billion of total debt. The company's average cost of debt
declined to 10.59% in 2018 from 12.34% in 2017, and we expect it
will decline further in 2019."

The company's leading position in the Russian real estate
development industry will continue to support the rating. PIK
Group's current construction volume (about 7.6 million m2) is
around 80% higher than that of LSR (not rated), Russia's No. 2
developer (source: https://erzrf.ru). PIK Group has an attractive
land bank covering six years of operations, and a reputation for
fast and reliable construction project execution. It benefits from
a strong order book, with about 80% of projects sold before
completion.

S&P said, "We also see PIK Group's exposure to the dynamic Moscow
metropolitan area as a strength. The company's operations are
concentrated in the city of Moscow and in the broader Moscow
region, where 86% of its net sellable area (10.8 million m2 in
total) is located. We believe that demand for new housing in these
regions will remain more robust than the average demand across
Russia, given sustainably strong immigration to Moscow from other
Russian regions. We also factor in PIK Group's presence in 10 large
Russian regions, including two new regional markets, Ekaterinburg
(the Urals) and Tyumen (Siberia).

"Rating constraints still include PIK Group's high exposure to the
cyclical and capital-intensive property development industry (which
currently comprises 100% of the company's EBITDA), significant
competition in the industry, and concentration on Russia, where we
assess country risk as high. We also believe that the economy
housing segment, in which PIK Group operates, may prove to be more
vulnerable to continuing household income contraction than other
segments. Furthermore, we assume that the economy segment would
also be more vulnerable to tighter mortgage conditions. The
company's exposure to the mortgage market is high, given that 65%
of its sales are mortgage funded. Another important consideration
is the changing regulatory framework in the industry.

"The stable outlook reflects our anticipation that PIK Group will
sustain its leading market position and maintain its adjusted debt
to EBITDA below 3x-4x throughout 2019-2020, supported by at least
stable completions, gradual margin recovery, and a prudent
financial policy. We also expect that the company will keep its
liquidity at least adequate, implying minimal refinancing risk.

"We could lower the rating if the level of operating cash flow or
profitability is lower than our base-case projections, resulting in
debt (including project finance loans) to EBITDA higher than 4x or
a five-year weighted-average EBITDA interest coverage lower than
3x. This could occur in the event of a higher-than-expected cost
base or lower demand for new apartments and lower pre-sales (which
we currently do not expect), or project finance debt building
faster than pre-sales and completions. Negative rating pressure
might also materialize if PIK Group's debt maturity profile
shortens or if liquidity materially deteriorates.

"Rating upside is less likely in the next 12-18 months. We could
raise the rating if PIK Group improves its leverage metrics with
adjusted debt to EBITDA sustainably below 2x and EBITDA interest
coverage staying above 6x, supported by top-line growth, coupled
with the EBITDA margin remaining sustainably at 20% or higher.
Rating upside would also depend on the company's ability to
maintain adequate liquidity and an absence of near-term refinancing
risk."

TMK PAO: S&P Places 'B+' ICR on Watch Positive on Sale of IPSCO
---------------------------------------------------------------
S&P Global Ratings placed its 'B+' long-term issuer credit and
issue ratings on TMK PAO on CreditWatch with positive
implications.

The CreditWatch placement follows TMK's announcement on March 22,
2019, that it has signed a stock purchase agreement with Tenaris
S.A., a seamless and welded pipes manufacturer, for the sale of
100% of its shares in IPSCO Tubulars Inc. (IPSCO) for $1,209
million. The transaction requires regulatory permissions and
approvals before completion.

S&P said, "We believe that TMK could use a sizeable part of the
$1.2 billion proceeds to repay some of its $2.97 billion of debt,
in line with its deleveraging strategy. This could translate into
meaningful improvement in credit metrics. Depending on the amount
of debt repaid, fund from operations (FFO) to debt could exceed 20%
and debt to EBITDA could fall to about 3x, which would be
commensurate with higher rating.

"We note that sale of IPSCO will lead to deconsolidation of about
$164 million of EBITDA (out of S&P Global Ratings-adjusted EBITDA
of $654.7 million for the whole company in 2018) and only about $64
million of debt. Therefore, should a large part of the proceeds be
distributed as dividends, TMK's leverage could remain largely
unchanged. At end-2018, S&P Global Ratings-adjusted debt to EBITDA
stood at 4x and FFO to debt at 14.8%.

"We aim to resolve the CreditWatch after the transaction closes and
once we have more visibility on how the company plans to use the
proceeds and TMK's longer-term financial policy. We could upgrade
TMK, if the company were to successfully complete the sale of IPSCO
to Tenaris for about $1.2 billion and use the majority of the
proceeds to repay debt. To support an upgrade, we would expect FFO
to debt of at least 20% and debt to EBITDA of about 3x on a
sustainable basis. Maintenance of adequate liquidity and proactive
refinancing of 2020 maturities are pre-requisites for an upgrade.

"We could affirm the rating if the transaction does not close for
unforeseen reasons, or if TMK decides to distribute a large portion
of the proceeds as dividends, thereby not achieving the indicated
thresholds."



=========
S P A I N
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FONCAIXA FTGENCAT 4: Fitch Affirms Class E Notes Rating at 'CCsf'
-----------------------------------------------------------------
Fitch Ratings has upgraded three classes of Foncaixa FTGENCAT 4,
FTA (FTGENCAT 4) and affirmed two classes.

The transaction is a securitisation of SME loans originated by
CaixaBank.

KEY RATING DRIVERS

Increasing Credit Enhancement

Continued deleveraging and the non-amortising reserve fund have
contributed to an increase in credit enhancement (CE) over the last
12 months across all tranches. CE increased for the class B, C and
D notes to 23.3%, 15.0% and 7.4% in January 2019 from 20.1%, 12.9%
and 6.3%, respectively, in April 2018. Increasing CE is the driving
factor of the upgrade of the class B and D notes.

Positive Macroeconomic Backdrop

Spain is currently enjoying strong economic momentum, with domestic
demand supported by employment growth of 2.5% and favourable credit
conditions. Fitch forecasts a moderation in GDP growth to 2.1% in
2019 and 1.7% in 2020 from 2.6% in 2018 due to an expected decrease
in private consumption and investment growth.

High Delinquencies but Strong Recoveries

Delinquent loans (90+ days in arrears) have been continuously
increasing during the past three years. As of January 31, 2019, 90+
delinquencies were closed to their historical maximum, accounting
for approximately 5% of the outstanding portfolio balance. This
negative effect is mitigated by high recoveries, mainly due to the
high proportion of loans backed by a first-lien mortgage (90% of
the portfolio as of 31 January 2019) and their relatively low
weighted average LTV. The cumulative recovery rate was 75.3% as of
31 January 2019.

Significant Swap Counterparty Support

The transaction features a swap providing material support to the
transaction, as the swap counterparty (Caixabank, BBB+/Stable/F2)
pays interests on a notional equal to the aggregate balance of the
class A to D notes (which equates to the performing and delinquent
loans balance plus the amount of defaulted loans not provisioned),
while only receiving interest actually collected on the portfolio.
As Fitch believes a swap with these unique features would not be
replaceable, the agency has given limited credit to the derivative
in scenarios above Caixabank's rating and considered in its cash
flow analysis a swap with less supportive terms in rating scenarios
above 'BBB+sf'. As a result, unlike the class A(G) and B notes, the
class C notes cannot currently withstand stresses above 'BBB+sf'.
Fitch has removed the class C notes from Rating Watch Positive
(RWP) where they were placed on 23 October 2018 to reflect the
upgrade of CaixaBank to 'BBB+' from 'BBB'.

Payment Interruption Risk Caps Class A(G) Rating

The highest achievable note rating for FTGENCAT 4 is capped at
'A+sf', due to payment interruption risk. Under Fitch's Structured
Finance and Covered Bonds Counterparty Rating Criteria, Caixabank
can support the notes at five notches above the counterparty's
rating up to 'A+sf'. Payment interruption risk is otherwise not
mitigated due to the lack of additional liquidity support other
than the reserve fund, which could be depleted before the notes are
amortised if used to cover for asset losses.

Class E Notes Uncollateralised

The reserve fund will be the only available form of repayment for
the class E notes once the class A to D notes are redeemed. Under
current conditions, further amortisation of the notes is unlikely
until the redemption of the class A to D notes or maturity.
As a result, the class E notes remain un-collateralised and their
likely default is reflected by the 'CCsf' rating.

RATING SENSITIVITIES

The class C notes' rating is currently capped at CaixaBank's 'BBB+'
rating and could be upgraded or downgraded following changes to
Caixabank's rating.

A 25% decrease in recovery rates would lead to a three-notch
downgrade of the class B notes and a four-notch downgrade of the
class D 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 rating action.

DATA ADEQUACY

Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. There were no findings that affected the
rating analysis. Fitch has not reviewed the results of any third
party assessment of the asset portfolio information or conducted a
review of origination files as part of its ongoing monitoring.

Fitch did not undertake a review of the information provided about
the underlying asset pool ahead of the transaction's initial
closing. The subsequent performance of the transaction over the
years is consistent with the agency's expectations given the
operating environment and Fitch is therefore satisfied that the
asset pool information relied upon for its initial rating analysis
was adequately reliable.

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

The rating actions are as follows:

Foncaixa FTGENCAT 4, FTA

  -- EUR49.9 million class A(G) notes affirmed at 'A+sf'; Outlook
Stable

  -- EUR7.6 million class B notes upgraded to 'A+sf' from 'A-sf';
Outlook Stable

  -- EUR5.7 million class C notes upgraded to 'BBB+sf' from
'BBBsf'; off RWP; Outlook Stable

  -- EUR 5.2 million class D notes upgraded to 'BB-sf' from 'B+sf';
Outlook Stable

  -- EUR 5 million class E notes affirmed at 'CCsf'; Recovery
Estimate 40%



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

ASTON MARTIN: S&P Affirms 'B' LT ICR, Alters Outlook to Neg.
-------------------------------------------------------------
S&P Global Ratings revised its outlook on Aston Martin Lagonda
(AML) to negative from stable. At the same time, S&P affirmed its
'B' long-term issuer credit rating on AML. Although the company
continues to exhibit strong volume and revenue growth, with an
expected improvement in profitability and cash flows going forward,
it is exposed to rising geopolitical risks, including those
associated with a potential no-deal Brexit and new U.S. tariffs.

AML exports a significant amount of the cars it produces in the
U.K. to the EU and the U.S. A no-deal Brexit could result in supply
chain shocks, tariffs on imports and exports, and a dip in consumer
confidence. Given that AML's production presence is concentrated in
the U.K., this could harm the company more than it would some of
its rated peers.

S&P said, "Our forecast for a no-deal Brexit scenario suggests that
pound sterling could initially depreciate by up to 15%. We also
expect World Trade Organization import tariffs to apply to imports
from the EU and countries covered by EU free trade agreements,
although the EU could impose tariffs. As a result, we estimate
goods exports from the U.K. could fall by 1.9% of U.K. GDP compared
with our baseline forecast. The weaker pound sterling exchange rate
would somewhat offset this, because U.K. goods would be cheaper to
export abroad. We note that AML's management is taking action to
build inventory stocks and arrange for alternative ports of entry
and exit."

The possibility of new U.S. tariffs also presents a potential risk,
although the impact on AML would likely be less than that of a
no-deal Brexit. The U.S. government is currently weighing up
whether to impose tariffs on vehicles imported from Europe--a 25%
rate is on the table.

Although AML could be negatively affected by new tariffs, none of
the six global luxury sports car manufacturers (AML, Ferrari,
Rolls-Royce, Lamborghini, Bentley, and McLaren) has a production
presence in the U.S. All these manufacturers would therefore be
subject to the same tariffs and the competitive landscape would not
materially change. Tariffs would not give any single manufacturer a
significant pricing advantage over the others. Luxury sports car
customers also tend to be less price sensitive than customers for
mass-produced vehicles. S&P said, "We anticipate that AML would be
able to adjust pricing, in time, and so pass some of the tariffs
on. As such, we view U.S. tariffs as less of a threat than a
no-deal Brexit. At this stage, we view a potential no-deal Brexit
and new U.S. tariffs as event risks, and we do not include them in
our base case."

These geopolitical risks aside, AML continues to make good progress
with its ambitious plans to upgrade and refresh its entire range of
luxury sports cars, and expand into new segments (sport utility
vehicles [SUVs] and sedans) by 2022. Under this strategy, the first
new core model to be successfully launched was the DB11 sports car
in 2016, followed by the new Vantage in 2017 and DBS Superleggera
in 2018. S&P sees these launches as clear signs that AML can
deliver on its strategy.

Over this period, AML has also successfully delivered high-value
specials including the Vanquish Zagato Volante, Zagato Speedster,
DB4 GT Continuation and V12 Vantage V600. The company plans to
launch additional new models in the coming years, including the DBX
SUV in 2019. The company has finished building a new manufacturing
plant at St Athans, Wales, which should double the company's
overall production capacity in the coming years and support new
model roll out.

S&P said, "We expect AML to continue to deliver on its ambitious
strategy, although it requires sustained high levels of research
and development (R&D) investment and capital expenditure (capex).
We also expect the improved operating performance to lead to
positive S&P Global Ratings-adjusted EBITDA in 2019, despite
continued high R&D costs. We expense all R&D costs, whereas the
company largely capitalizes them. We forecast that funds from
operations (FFO) will be positive from 2019, despite high interest
costs. Given the high capex, we expect free operating cash flow
(FOCF) to remain negative in 2019."

The company's volume and revenue growth for 2018 were significantly
stronger year-over-year than we expected. That said, the company
incurred some sizable unexpected costs associated with its IPO; we
do not expect these to be repeated. As a result, its cash flow was
weaker than expected. Revenues increased by about 25% and reported
EBITDA stood at GBP173 million, while adjusted EBITDA remained
slightly negative because of high R&D charges.

S&P said, "Our assessment of AML's business risk profile remains
constrained by the company's limited product range and operating
diversity; still very sizable R&D expenses, weak EBITDA and FFO;
and the cyclical demand for luxury sports cars. AML also has a
niche market position compared with larger and stronger peers.
Mitigating factors include strong brand recognition, the
introduction of a modular production platform, and above-average
growth rates in the luxury sports car segment.

"We also recognize the company's successful launch of the DB11
sports car, the Vantage, the DBS Superleggera and other special
edition cars, which demonstrate improving business prospects. We
expect this will continue, further strengthening AML's competitive
position, and lead to improved profitability in coming years. AML's
agreement with German auto manufacturer Daimler AG to provide
electronic architecture and engines is also a positive factor.

"Our assessment of AML's financial risk profile remains constrained
by the need for continued sizable R&D and capex, and our forecast
that FOCF will be negative in 2019. Mitigating factors include an
improving trend in profitability and cash generation in 2019; and
the long-dated debt maturity profile.

"As of Dec. 31, 2018, our adjusted debt calculation for AML was
GBP740 million. We adjusted reported gross debt to GBP704 million
by adding about GBP36 million of operating leases.

"The negative outlook indicates that, despite our expectation that
AML will continue to successfully deliver on its business strategy,
increase revenues, and improve its profitability and cash flow
generation (and ultimately its credit metrics) it faces heightened
event risk associated with a potential no-deal Brexit and new
tariffs on the vehicles that AML exports to the U.S. We expect
adjusted EBITDA and FFO to turn positive in 2019. We also expect
that the FFO cash interest coverage ratios will improve toward 2.5x
over the next 12 months, but that FOCF will remain negative due to
the high level of capex.

"We could downgrade AML if it experiences delays or production
problems in delivering its planned volumes, if FFO cash interest
coverage ratios do not improve toward 2.5x over the next 12 months,
or its FOCF is weaker than we forecast. Such a scenario could also
occur if development costs were notably higher than currently
expected. We could also lower the ratings if the U.K. government
were to press ahead with a no-deal Brexit or if the U.S. government
were to introduce new vehicle import tariffs.

"We could revise the outlook to stable if AML continued to meet our
expectations for FY2019 and the risks relating to a no-deal Brexit
or U.S. tariffs became less imminent. We could raise the ratings if
AML continues to strengthen its competitive position by refreshing,
replacing, and extending its sports car range, generating positive
FOCF, and reducing adjusted debt to EBITDA sustainably below 5x.
However, we see such a scenario as unlikely in the near term, given
the ongoing level of investments in new models."

DEBENHAMS PLC: Investors Express Support to Install Ashley as CEO
-----------------------------------------------------------------
James Davey at Reuters reports that Sports Direct, the sportswear
group that is seeking control of Debenhams, said it has been
contacted by other shareholders in the department store group
expressing their support to install Mike Ashley as Debenhams CEO.

Sports Direct, which has a near 30% stake in Debenhams, did not say
how many Debenhams shareholders were backing it or name any of
them, Reuters notes.

According to Reuters, Sports Direct said it has set up a template
letter on its website to enable any shareholders in Debenhams to
make their views known.

On March 29, Debenhams secured GBP200 million (US$261.4 million) in
new funds but warned shareholders still faced being wiped out
unless Sports Direct gave its support, Reuters relates.

Debenhams, as cited by Reuters, said Sports Direct needed to either
make a firm offer for the group, underwrite a rights issue, or
provide debt funding if it wanted to prevent Debenhams' ownership
falling into the hands of lenders.

Sports Direct said last week it was considering a GBP61.4 million
offer, Reuters recounts.


JAMIE'S ITALIAN: Averts GBP1MM in Unpaid Rent Following CVA
-----------------------------------------------------------
Richard Moriarty at The Sun reports that Jamie Oliver has dodged
more than GBP1 million in unpaid rent at his struggling restaurant
chain.

But the landlords have been left out of pocket after Jamie's
Italian Ltd. went close to going bust in 2017, The Sun relates.

A Company Voluntary Arrangement meant Jamie's firm was able to
carry on trading but had to close 12 of 25 sites with the loss of
600 jobs, The Sun states.

Creditors were owed GBP1,445,912 in unpaid rent, The Sun
discloses.

But in a deal with administrators, Jamie's company agreed to pay
back just GBP356,706, The Sun notes.



LK BENNETT: Philip Day Pulls Out of Race to Acquire Business
------------------------------------------------------------
Oliver Gill at The Telegraph reports that billionaire Philip Day
has withdrawn his interest in
LK Bennett, leaving a trio of front-runners to battle it out for
the stricken retailer.

According to The Telegraph, Dune, Sports Direct's Mike Ashley and
franchisee Rebecca Fang are left in the running for the fashion
chain, popular with the likes of the Duchess of Cambridge and
Theresa May.

LK Bennett called in administrators from EY in March as the latest
victim of an embattled high street, The Telegraph discloses.

Mr. Day, the Edinburgh Woollen Mill founder, who insiders say made
an "uncompetitive approach", was on March 30 understood to have
withdrawn his interest The Telegraph relates.

Founded by Linda Bennett in 1990, LK Bennett collapsed after
racking up multimillion-pound losses, putting 500 jobs at risk, The
Telegraph recounts.


LONDON CAPITAL: First-Time Investors May Not Get Compensation
-------------------------------------------------------------
BBC News reports that thousands of first-time investors who lost
their savings through investment with London Capital & Finance
(LCF) are unlikely to qualify for compensation.

Nearly 12,000 people put more than GBP230 million into the firm
which collapsed in January, BBC discloses.

According to BBC, the Financial Services Compensation Scheme (FSCS)
acknowledged that the investors had lost money "through no fault of
their own".

But it told the BBC "there were no grounds for offering
compensation", BBC relates.

FSCS chief executive Mark Neale told BBC Radio 4's Money Box that
the way in which the fund sold bonds meant that investors were not
covered under FSCS's rules.

"The bonds themselves were not regulated products, and on our
current understanding, we do not believe that customers were given
personal advice to buy the bonds," BBC quotes Mr. Neale as saying.

"That is crucial because it is the personal advice that is
regulated."

Mr. Neale, as cited by BBC, said consumers may be confused by the
fact that the collapsed company was regulated to give financial
advice only.

LCF advertised itself as a low-risk ISA, and promised to spread
funds between hundreds of companies, BBC states.

In reality, the fund did not qualify as an ISA, and the money was
only invested in 12 companies, 10 of which were described as "not
independent" from LCF, in a report by the fund's administrators,
BBC notes.

Administrators Smith & Williamson have asked four people, Andy
Thomson, Simon Hume-Kendall, Elten Barker and Spencer Golding to
return funds, BBC relays.

They say Mr. Hume-Kendall and Mr. Thomson have agreed to pay these
monies into a holding account to be paid to bond holders in the
event they do not receive a full return of their money, BBC
discloses.

Spencer Golding and Elten Barker declined to do the same as Mr.
Hume-Kendall and Mr. Thomson, BBC notes.  They told the
administrator that they "believe the bond holders will be paid back
in full through the assets which LCF owns", according to BBC.


LONDON CAPITAL: Regulators Failed to Take Action on Toxic Bonds
---------------------------------------------------------------
James Burton for The Daily Mail reports that regulators knew four
years ago about problems with toxic bonds like those sold by
collapsed trading firm London Capital & Finance, but failed to take
action.

The City watchdog warned in 2015 that so-called mini-bonds are
highly risky products where investors' money is not protected, and
that many firms selling them rely on dodgy marketing practices
which fail to make the dangers clear, The Daily Mail recounts.

But after saying it had concerns, the Financial Conduct Authority
did nothing to make the products safer, The Daily Mail discloses.

And now, 11,500 savers who pumped their money into mini-bonds
through LCF face massive losses, The Daily Mail notes.

LCF went bust earlier this year after raking in GBP237 million from
customers who were offered returns of 8% and thought their cash
would be invested in a wide range of start-ups, The Daily Mail
relays.

Administrators revealed the money went to just 12 companies in
transactions described as "highly suspicious", The Daily Mail
states.

The revelations that the FCA could have acted sooner will add to
pressure for an independent investigation into what went wrong,
according to The Daily Mail.

Labour MP John Mann, a member of the Treasury select committee, as
cited by The Daily Mail, said: "The FCA has clearly been asleep at
the wheel over mini-bonds.

"If it knew these products were risky years ago, it should have
acted then to protect consumers. Tougher regulation could have
saved thousands of LCF customers from losing their life savings."

According to The Daily Mail, Nicky Morgan, chairman of the Treasury
select committee, has written to the FCA calling for a regulatory
failure investigation to determine why more had not been done to
protect LCF customers.


SMALL BUSINESS 2019-1: Moody's Rates Class D Notes '(P)Ba3'
-----------------------------------------------------------
Moody's Investors Service has assigned the following provisional
ratings to four classes of Notes to be issued by Small Business
Origination Loan Trust 2019-1 DAC:

GBP[*] Class A Floating Rate Asset-Backed Notes due December 2027,
Assigned (P)Aa3 (sf)

GBP[*] Class B Floating Rate Asset-Backed Notes due December 2027,
Assigned (P)A3 (sf)

GBP[*] Class C Floating Rate Asset-Backed Notes due December 2027,
Assigned (P)Baa2 (sf)

GBP[*] Class D Floating Rate Asset-Backed Notes due December 2027,
Assigned (P)Ba3 (sf)

Moody's has not assigned ratings to GBP[*] Class E Floating Rate
Asset-Backed Notes, GBP[*] Class X Floating Rate Asset-Backed Notes
and GBP[*] Class Z Variable Rate Asset-Backed Notes which will also
be issued by the Issuer.

Moody's issues provisional ratings in advance of the final sale of
financial instruments, but these ratings only represent Moody's
preliminary credit opinions. Upon a conclusive review of a
transaction and associated documentation, Moody's will endeavour to
assign definitive ratings. A definitive rating (if any) may differ
from a provisional rating.

SBOLT 2019-1 is a securitization backed by a static pool of small
business loans originated through Funding Circle Limited's online
lending platform. The loans were granted to individual
entrepreneurs and small and medium-sized enterprises (SME)
domiciled in UK. Funding Circle will act as the Servicer and
Collection Agent on the loans and P2P Global Investments PLC will
be the retention holder.

RATINGS RATIONALE

The ratings of the notes are primarily based on the analysis of the
credit quality of the underlying portfolio, the structural
integrity of the transaction, the roles of external counterparties
and the protection provided by credit enhancement.

In Moody's view, the strong credit positive features of this deal
include, among others:

(i) a static portfolio with a short weighted average life of around
2 years;

(ii) certain portfolio characteristics, such as:

a) high granularity with low single obligor concentrations (for
example, the top individual obligor and top 10 obligor exposures
are 0.3% and 2.6% respectively) and an effective number above
1,200;

b) the loans' monthly amortisation; and

c) the high yield of the loan portfolio, with a weighted average
interest rate of 9.5%.

(iii) the transaction's structural features, which include:

(a) a cash reserve initially funded at 1.75% of the initial
portfolio balance, increasing to 2.75% of the initial portfolio
balance before amortising in line with the rated Notes; and

(b) a non-amortising liquidity reserve sized and funded at 0.25% of
the initial portfolio balance;

(c) an interest rate cap with a strike of 3% that provides
protection against increases on LIBOR due on the rated Floating
Rate Asset-Backed Notes.

(iv) no set-off risk, as obligors do not have deposits or
derivative contracts with Funding Circle.

However, the transaction has several challenging features, such
as:

(i) the rapid growth of origination volumes during the short
operating history of the Originator and Servicer, without any
experience of a significant economic downturn;

(ii) potential misalignment of interest between the Originator and
the noteholders as the Originator does not retain a direct economic
interest in the transaction. This is partially mitigated by the
Seller acting as retention holder, and repurchase and
indemnification obligations of the Originator and the Seller in
case the representations and warranties are proven incorrect;

(iii) relatively high industry concentrations as around 40% of the
obligors belong to the top two sectors, namely Services: Business
(23%) and Construction & Building (17%), and the high exposure to
individual entrepreneurs and micro-SMEs (over 62% of the
portfolio); and

(iv) the loans are only collateralized by a personal guarantee, and
recoveries on defaulted loans often rely on the realization of this
personal guarantee via cashflows from subsequent business started
by the guarantor.

Key collateral assumptions:

Mean default rate: Moody's assumed a mean default rate of 12.5%
over a weighted average life of 2.1 years (equivalent to a B2 proxy
rating as per Moody's Idealized Default Rates). This assumption is
based on:

(i) the available historical vintage data;

(ii) the performance of the previous transactions backed by loans
originated by Funding Circle; and

(iii) the characteristics of the loan-by-loan portfolio
information.

Moody's took also into account the current economic environment and
its potential impact on the portfolio's future performance, as well
as industry outlooks or past observed cyclicality of
sector-specific delinquency and default rates.

Default rate volatility: Moody's assumed a coefficient of variation
(i.e. the ratio of standard deviation over the mean default rate)
of 47.9%, as a result of the analysis of the portfolio
concentrations in terms of single obligors and industry sectors.

Recovery rate: Moody's assumed a 25% stochastic mean recovery rate,
primarily based on the characteristics of the collateral-specific
loan-by-loan portfolio information, complemented by the available
historical vintage data.

Portfolio credit enhancement: the aforementioned assumptions
correspond to a portfolio credit enhancement of 45%.

As of January 31, 2019, the loan portfolio of approximately GBP
186.9 million was comprised of 2,618 loans to 2,610 borrowers. All
loans accrue interest on a fixed rate basis. The average remaining
loan balance stood at GBP 71,411, with a weighted average fixed
rate of 9.49%, a weighted average remaining term of 48.5 months and
a weighted average seasoning of 5.0 months. Geographically, the
pool is concentrated mostly in the South East (23.82%) and London
(17.08%). Generally, the loans were taken out by borrowers to fund
the expansion or growth of their business and each loan benefits
from a personal guarantee from (typically) the owner(s) of the
business. At closing, any loan more than 30 days in arrears will be
excluded from the final pool.

Key transaction structure features:

Cash Reserve Fund: The transaction benefits from a cash reserve
fund initially funded at 1.75% of the initial portfolio balance,
increasing to 2.75% of the initial portfolio balance before
amortising in line with the rated Notes. The reserve fund provides
both credit and liquidity protection to the rated Notes.

Liquidity Reserve Fund: The transaction benefits from a separate,
non-amortising liquidity reserve fund sized and funded at 0.25% of
the initial portfolio balance. When required, funds can be drawn to
provide liquidity protection to the senior Notes.

Counterparty risk analysis:

Funding Circle (NR) will act as Servicer of the loans and
Collection Agent for the Issuer. Link Financial Outsourcing Limited
(NR) will act as a warm Back-Up Servicer and Collection Agent.

All of the payments on loans in the securitised loan portfolio are
paid into a Collection Account held at Barclays Bank PLC (A2 /
P-1). There is a daily sweep of the funds held in the Collection
Account into the Issuer Account, which is held with Citibank, N.A.,
London Branch (Aa3 / P-1), with a transfer requirement if the
rating of the account bank falls below A2 / P-1.

Principal Methodology:

The principal methodology used in these ratings was "Moody's Global
Approach to Rating SME Balance Sheet Securitizations" published in
March 2019.

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

The notes' ratings are sensitive to the performance of the
underlying portfolio, which in turn depends on economic and credit
conditions that may change. The evolution of the associated
counterparties risk, the level of credit enhancement and the United
Kingdom's country risk could also impact the notes' ratings.

The ratings address the expected loss posed to investors by the
legal final maturity of the Notes. In Moody's opinion, the
structure allows for timely payment of interest on the Class A and
ultimate payment of principal with respect to all rated Notes by
the legal final maturity. Moody's ratings address only the credit
risk associated with the transaction. Other non-credit risks have
not been addressed but may have a significant effect on yield to
investors.

TOWD POINT 2019: S&P Assigns Prelim BB Rating to F-Dfrd Notes
-------------------------------------------------------------
S&P Global Ratings assigned preliminary credit ratings to Towd
Point Mortgage Funding 2019-Granite 4 PLC's (Towd Point) class A1,
B-Dfrd, C-Dfrd, D-Dfrd, E-Dfrd, and F-Dfrd notes. At closing, Towd
Point will also issue unrated class Z, XA1, XA2, and XB notes.

S&P bases its credit analysis on a preliminary pool of GBP3,935.7
million (as of Dec. 31, 2018). The pool comprises first-lien U.K.
residential mortgage loans that Landmark Mortgages Ltd. (previously
known as NRAM) originated.

Landmark is the master servicer, but the servicing will be
delegated to Computershare Mortgage Services Ltd. (a subsidiary of
Computershare). The delegated backup servicer is Capital Home Loans
Ltd.

Approximately 92% of the pool comprises standard variable rate
(SVR) loans, or loans which will revert to an SVR in the future.
Based on S&P's legal analysis and the conditions outlined in the
various servicing agreements, it has applied a SVR floor rate to
the SVR loans from day one.

S&P said, "We rate the class A1 notes based on the payment of
timely interest. Interest on the class A1 notes is equal to
three-month sterling LIBOR plus a class-specific margin.

"As previously mentioned, we treat the class B-Dfrd to F-Dfrd notes
as deferrable-interest notes in our analysis. Under the transaction
documents, the issuer can defer interest payments on these notes.
While our preliminary 'AAA (sf)' rating on the class A1 notes
addresses the timely payment of interest and the ultimate payment
of principal, our preliminary ratings on the class B-Dfrd to F-Dfrd
notes address the ultimate payment of principal and interest.

"Our preliminary ratings reflect our assessment of the
transaction's payment structure, cash flow mechanics, and the
results of our cash flow analysis to assess whether the notes would
be repaid under stress test scenarios. Subordination and excess
spread (there will be no reserve fund in this transaction) will
provide credit enhancement to the rated notes that are senior to
the unrated notes and certificates. Taking these factors into
account, we consider that the available credit enhancement for the
rated notes is commensurate with the preliminary ratings
assigned."

  RATINGS LIST

  Preliminary Ratings Assigned
  Towd Point Mortgage Funding 2019-Granite4 PLC

  Class     Prelim. rating*      Amount
  A1        AAA (sf)             TBD
  B-Dfrd    AA+ (sf)             TBD
  C-Dfrd    A+ (sf)              TBD
  D-Dfrd    A (sf)               TBD
  E-Dfrd    BBB (sf)             TBD
  F-Dfrd    BB (sf)              TBD
  Z         NR                   TBD
  XA1       NR                   N/A
  XA2       NR                   N/A
  XB        NR                   N/A

* The preliminary ratings address timely receipt of interest and
ultimate repayment of principal for the class A1 notes. The
preliminary ratings assigned to the class B-Dfrd to F-Dfrd notes
are interest-deferred ratings and address the ultimate payment of
interest and principal.


                           *********


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 2019.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
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                * * * End of Transmission * * *