250721.mbx

250721.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Monday, July 21, 2025, Vol. 26, No. 144 Headlines F R A N C E NORIA 2025: DBRS Gives Prov. BB Rating to Class F Notes I R E L A N D ARES EUROPEAN XXII: S&P Assigns B- (sf) Rating to Class F Notes BARINGS EURO 2023-2: S&P Assigns Prelim B-(sf) Rating to F-R Notes CVC CORDATUS XXIX: S&P Assigns B- (sf) Rating to Class F-R Notes FROSN-2018: DBRS Cuts Class E Notes Rating to CC HARVEST CLO XXXVI: S&P Assigns B- (sf) Rating to Class F Notes OCP EURO 2025-13: Fitch Assigns 'B-sf' Final Rating to Cl. F Notes RIVER GREEN 2020: DBRS Cuts Class B Notes Rating to BB RRE 27 LOAN: S&P Assigns BB- (sf) Rating to Class D Notes I T A L Y BCC 2019: DBRS Confirms CC Rating on Class B Notes RINO MASTROTTO: Fitch Affirms B+ LT IDR, Alters Outlook to Negative L U X E M B O U R G PLATIN2025 INVESTMENTS: S&P Affirms 'B' ICR, Outlook Neg. R U S S I A NATIONAL BANK: Fitch Puts 'BB' Final Rating to Sr. Unsec. Eurobonds T U R K E Y SEKERBANK T.A.S: Fitch Affirms 'CCC(EXP)' Rating on AT1 Notes U N I T E D K I N G D O M AMBER HOLDCO: Fitch Affirms 'B+' Long-Term IDR, Outlook Stable AXIS LOGISTICS: Teneo Financial Named as Joint Administrators FINSBURY 2025-1: Fitch Assigns 'B+sf' Final Rating to Class F Debt HONK HONK: Antony Batty Named as Administrators MB HEALTHCARE: CMB Partners Named as Administrators PAVILLION 2022-1: Fitch Affirms 'Bsf' Rating on Class E Notes POLARIS 2025-2 PLC: DBRS Gives Prov. CCC Rating to Class F Notes POLARIS 2025-2: S&P Assigns B- (sf) Rating to Class X1-Dfrd Notes RYEBECK TRADING: FRP Advisory Named as Joint Liquidators STRATTON 2024-2: Fitch Affirms 'BB+sf' Rating on Class F Notes TAURUS 2025-4: Fitch Assigns 'BB+(EXP)sf' Rating to Class E Notes WESSEX WELDING: Leonard Curtis Named as Joint Administrators XL JOINERY: S&W Partners Named as Joint Administrators - - - - - =========== F R A N C E =========== NORIA 2025: DBRS Gives Prov. BB Rating to Class F Notes ------------------------------------------------------- DBRS Ratings GmbH assigned provisional credit ratings to the following notes (the Rated Notes) to be issued by Noria 2025 (the Issuer): -- Class A Notes at (P) AAA (sf) -- Class B Notes at (P) AA (high) (sf) -- Class C Notes at (P) AA (low) (sf) -- Class D Notes at (P) A (low) (sf) -- Class E Notes at (P) BBB (low) (sf) -- Class F Notes at (P) BB (sf) Morningstar DBRS did not rate the Class G Notes (collectively with the Rated Notes, the Notes) also expected to be issued in the transaction. The credit ratings of the Class A, Class B, and Class C Notes address the timely payment of scheduled interest and the ultimate repayment of principal by the final maturity date. The credit ratings of the Class D, Class E, and Class F Notes address the ultimate payment of interest (timely when most senior) and the ultimate repayment of principal by the final maturity date. The transaction is a securitization of a portfolio of fixed-rate, unsecured, amortizing personal loans, debt consolidation loans, and sales finance loans granted to private individuals domiciled in France by BNP Paribas Personal Finance, which is part of the BNP Paribas Group. BNP Paribas Personal Finance is also the seller and the initial servicer of the transaction, which has no exposure to balloon payments or residual value. CREDIT RATING RATIONALE Morningstar DBRS' credit ratings are based on the following analytical considerations: -- The transaction's structure, including the form and sufficiency of available credit enhancement to withstand stressed cash flow assumptions and repay the Issuer's financial obligations according to the terms under which the Rated Notes are issued -- The credit quality and diversification of the collateral portfolio, its historical performance, and the projected performance under various stress scenarios -- The operational risk review of the seller's capabilities with regard to its originations, underwriting servicing, and financial strength -- The transaction parties' financial strength with regard to their respective roles -- The expected consistency of the transaction's structure with Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology -- Morningstar DBRS' long-term sovereign credit rating on the Republic of France, currently at AA (high) with a Negative trend TRANSACTION STRUCTURE The transaction includes a [12]-month scheduled revolving period, during which the Issuer is able to purchase additional loan receivables, subject to the eligibility criteria and concentration limits set out in the transaction documents. The revolving period may end earlier than scheduled if certain events occur such as the insolvency of the seller, replacement of the servicer, or the breach of performance triggers. The transaction allocates collections in separate interest and principal priorities of payments and benefits from an amortizing liquidity reserve equal to [1.5]% of the Rated Notes' outstanding balance, subject to a floor of EUR [] until the full redemption of the Class F Notes. The liquidity reserve will be initially funded by the seller. Before the application of the liquidity reserve, principal funds will be reallocated to cover shortfalls in senior expenses; senior swap payments; interest on the Class A Notes; and, if not deferred, interest on the Class B, Class C, Class D, Class E, and Class F Notes. The liquidity reserve is available to cover the remaining shortfalls if the interest and principal collections are not sufficient and would be replenished in the interest waterfall. After the end of the revolving period, the repayment of the Notes will be on a pro rata basis until the occurrence of a sequential redemption event, such as the debit amount in the transaction's principal deficiency ledger exceeding 0.75% or the cumulative defaulted purchased receivables ratios exceeding pre-determined thresholds, after which the repayment will switch to be sequential and non-reversible. A commingling reserve will also be funded and available to the Issuer if the credit rating of the specially dedicated account bank is below the required threshold, there is a breach of its material obligations or an insolvency and regulatory event. The required amount is equal to the sum of [2.5]% of the performing receivables and [0.6]% of the outstanding principal balance of the initial receivables. Morningstar DBRS considers the interest rate risk for the transaction to be limited as an interest rate swap is in place to reduce the mismatch between the fixed-rate collateral and the Notes. TRANSACTION COUNTERPARTIES BNP Paribas (acting through its Securities Services department) is the account bank for the transaction. Based on Morningstar DBRS' Long-Term Issuer Rating of AA (low) on BNP Paribas, the downgrade provisions outlined in the transaction documents, and other mitigating factors in the transaction structure, Morningstar DBRS considers the risk arising from the exposure to the account bank to be consistent with the credit ratings assigned. The seller, BNP Paribas Personal Finance, is also the swap counterparty for the transaction. Morningstar DBRS privately rates BNP Paribas Personal Finance, which meets the criteria to act in such capacity. The transaction documents contain downgrade provisions largely consistent with Morningstar DBRS' criteria, and the transaction will be monitored based on Morningstar DBRS' credit ratings of its patent, BNP Paribas or BNP Paribas Personal Finance itself, depending on the ownership. PORTFOLIO ASSUMPTIONS Morningstar DBRS notes the seller has a long history of consumer lending in France and considers its loan performance data to be meaningful for vintage analysis. As the data show noticeably different default and recovery performance by loan type, Morningstar DBRS established expected default and recovery assumptions for each loan type and constructed a portfolio-level lifetime expected default and expected recovery of 4.6% and 40.1%, respectively, based on the possible portfolio migration during the scheduled revolving period. Morningstar DBRS' credit ratings on the Rated Notes address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. The associated financial obligations for each class of the Rated Notes are the related are the related interest amounts and principal amounts. Notes: All figures are in euros unless otherwise noted. ============= I R E L A N D ============= ARES EUROPEAN XXII: S&P Assigns B- (sf) Rating to Class F Notes --------------------------------------------------------------- S&P Global Ratings assigned its credit ratings to Ares European CLO XXII DAC's class A, B, C, D, E, and F notes. At closing, the issuer also issued unrated subordinated notes. The reinvestment period will be 4.5 years, while the non-call period will be 1.50 years after closing. Under the transaction documents, the rated notes will pay quarterly interest unless there is a frequency switch event. Following this, the notes will switch to semiannual payment. The ratings assigned to the notes reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which is in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings weighted-average rating factor 2,828.60 Default rate dispersion 406.43 Weighted-average life (years) 4.52 Obligor diversity measure 159.92 Industry diversity measure 23.16 Regional diversity measure 1.14 Transaction key metrics Total par amount (mil. EUR) 400.00 Defaulted assets (mil. EUR) 0.00 Number of performing obligors 175 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 0.00 Actual 'AAA' weighted-average recovery (%) 37.13 Actual weighted-average spread (net of floors; %) 3.71 Actual weighted-average coupon (%) 3.61 S&P said, "Our ratings reflect our assessment of the collateral portfolio's credit quality, which has a weighted-average rating of 'B'. "The portfolio is well-diversified on the closing date, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, we conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we modeled the covenanted weighted-average spread of 3.70%, the covenanted weighted-average coupon of 3.50%, the covenanted weighted-average recovery rate at the 'AAA' rating level (35.95%), and the actual weighted-average recovery rates at the other rating levels. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "Our ratings also reflect the payment of the class A notes' make-whole amount when due and when the class A investor condition is not satisfied as of the applicable redemption date. "At closing, the transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Under our structured finance sovereign risk criteria, the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Our credit and cash flow analysis indicates that the available credit enhancement for the class B to F notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from the effective date, during which the transaction's credit risk profile could deteriorate, we have capped our ratings assigned to the notes." The class A notes can withstand stresses commensurate with the assigned rating. S&P said, "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our ratings are commensurate with the available credit enhancement for all classes of notes. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class A to E notes, based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance S&P regards the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and S&P's ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities. Ares European CLO XXII is a European cash flow CLO securitization of a revolving pool, comprising euro-denominated senior secured loans and bonds issued mainly by speculative-grade borrowers. Ares Management Ltd. manages the transaction. Ratings list Amount Credit Class Rating* (mil. EUR) enhancement (%) Interest rate§ A AAA (sf) 244.00 39.00 Three/six-month EURIBOR plus 1.35% B AA (sf) 48.00 27.00 Three/six-month EURIBOR plus 1.80% C A (sf) 24.00 21.00 Three/six-month EURIBOR plus 2.10% D BBB- (sf) 28.00 14.00 Three/six-month EURIBOR plus 3.00% E BB- (sf) 17.00 9.75 Three/six-month EURIBOR plus 5.40% F B- (sf) 13.00 6.50 Three/six-month EURIBOR plus 8.17% Sub NR 31.40 N/A N/A *The ratings assigned to the class A and B notes address timely interest and ultimate principal payments. The ratings assigned to the class C, D, E, and F notes address ultimate interest and principal payments. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. BARINGS EURO 2023-2: S&P Assigns Prelim B-(sf) Rating to F-R Notes ------------------------------------------------------------------ S&P Global Ratings assigned preliminary credit ratings to Barings Euro CLO 2023-2 DAC's class A-R, B-1-R, B-2-R, C-R, D-R, E-R, and F-R notes. At closing, the issuer will have unrated subordinated notes outstanding from the existing transaction. This transaction is a reset of the already existing transaction. The existing classes of notes --class A loan, and class A, B-1, B-2, C, D, E, and F notes-- will be fully redeemed with the proceeds from the issuance of the replacement notes on the reset date. The preliminary ratings reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior-secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which S&P expects to be bankruptcy remote. -- The transaction's counterparty risks, which S&P expects to be in line with its counterparty rating framework. Portfolio benchmarks S&P weighted-average rating factor 2,767.91 Default rate dispersion 645.56 Weighted-average life (years) 4.16 Weighted-average life extended to cover the length of the reinvestment period (years) 4.50 Obligor diversity measure 137.18 Industry diversity measure 21.50 Regional diversity measure 1.28 Transaction key metrics Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 1.88 Actual 'AAA' weighted-average recovery (%) 37.20 Actual weighted-average spread (%) 4.40 Actual weighted-average coupon (%) 3.82 Under the transaction documents, the rated notes will pay quarterly interest unless a frequency switch event occurs. Following this, the rated notes will switch to semiannual payments. The portfolio's reinvestment period will end 4.50 years after closing. S&P said, "We understand that at closing, the portfolio will be well-diversified, primarily comprising broadly syndicated speculative-grade senior-secured term loans and senior-secured bonds. Therefore, we have conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR400 million target par amount, the covenanted weighted-average spread (3.80%), the covenanted weighted-average coupon (4.48%), and the actual weighted-average recovery rates calculated in line with our CLO criteria for all rating levels. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "Under our structured finance sovereign risk criteria, we consider that the transaction's exposure to country risk is sufficiently mitigated at the assigned preliminary ratings. "At closing, we expect that the transaction's documented counterparty replacement and remedy mechanisms will adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "We expect the transaction's legal structure and framework to be bankruptcy remote, in line with our legal criteria. "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe our preliminary ratings are commensurate with the available credit enhancement for the class A-R, B-1-R, B-2-R, C-R, D-R, E-R, and F-R notes. Our credit and cash flow analysis indicates that the available credit enhancement for the class B-1-R, B-2-R, C-R, and D-R notes could withstand stresses commensurate with the same or higher ratings than those we have assigned. However, as the CLO will be in its reinvestment phase starting from closing, during which the transaction's credit risk profile could deteriorate, we have capped our preliminary ratings assigned to these notes. "In addition to our standard analysis, to indicate how rising pressures among speculative-grade corporates could affect our ratings on European CLO transactions, we also included the sensitivity of the ratings on the class A-R to E-R notes based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F-R notes." The transaction securitizes a portfolio of primarily senior-secured leveraged loans and bonds, and it will be managed by Barings (U.K.) Ltd. Environmental, social, and governance (ESG) credit factors S&P said, "We regard the exposure to ESG credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain activities. "Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Ratings List Prelim. Prelim. Balance Credit Class rating* (mil. EUR) Interest rate§ enhancement (%) A-R AAA (sf) 248.00 3mE/6mE + 1.38% 38.00 B-1-R AA (sf) 36.00 3mE/6mE + 2.00% 26.50 B-2-R AA (sf) 10.00 5.00% 26.50 C-R A (sf) 24.00 3mE/6mE + 2.45% 20.50 D-R BBB- (sf) 26.00 3mE/6mE + 3.40% 14.00 E-R BB- (sf) 19.00 3mE/6mE + 6.25% 9.25 F-R B- (sf) 11.00 3mE/6mE + 8.67% 6.50 Sub notes NR 29.50 N/A N/A *The preliminary ratings assigned to the class A-R, B-1-R, and B-2-R notes address timely interest and ultimate principal payments. The preliminary ratings assigned to the class C-R, D-R, E-R, and F-R notes address ultimate interest and principal payments. The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. NR--Not rated. N/A--Not applicable. 3mE/6mE--Three/six-month Euro Interbank Offered Rate. CVC CORDATUS XXIX: S&P Assigns B- (sf) Rating to Class F-R Notes ---------------------------------------------------------------- S&P Global Ratings assigned its credit ratings to CVC Cordatus Loan Fund XXIX DAC's class A-R, B-R, C-R, D-R, E-R, and F-R notes. The issuer has unrated subordinated notes outstanding from the existing transaction and the issuer has also issued an additional EUR13.125 million of subordinated notes. This transaction is a reset of the already existing transaction. The existing classes of notes were fully redeemed with the proceeds from the issuance of the replacement notes on the reset date and the ratings on the original notes have been withdrawn. The ratings assigned to the notes reflect S&P's assessment of: -- The diversified collateral pool, which consists primarily of broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,890.13 Default rate dispersion 515.03 Weighted-average life (years) 4.45 Weighted-average life extended to cover the length of the reinvestment period (years) 4.58 Obligor diversity measure 106.03 Industry diversity measure 18.37 Regional diversity measure 1.16 Transaction key metrics Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 3.33 Target 'AAA' weighted-average recovery (%) 35.53 Target weighted-average spread (%) 3.87 Target weighted-average coupon (%) 4.91 Rating rationale Under the transaction documents, the rated notes pay quarterly interest unless a frequency switch event occurs. Following this, the notes will switch to semiannual payments. The portfolio's reinvestment period will end approximately 4.59 years after closing. The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, S&P has conducted its credit and cash flow analysis by applying its criteria for corporate cash flow CDOs. S&P said, "In our cash flow analysis, we used the EUR425 million target paramount, the target weighted-average spread (3.87%), the target weighted-average coupon (4.91%), and the target weighted-average recovery rates calculated in line with our CLO criteria for all rating levels. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "Under our structured finance sovereign risk criteria, we consider that the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "Until the end of the reinvestment period on Feb. 15, 2030, the collateral manager may substitute assets in the portfolio for so long as our CDO Monitor test is maintained or improved in relation to the initial ratings on the notes." This test looks at the total amount of losses that the transaction can sustain as established by the initial cash flows for each rating, and it compares that with the current portfolio's default potential plus par losses to date. As a result, until the end of the reinvestment period, the collateral manager may through trading deteriorate the transaction's current risk profile, if the initial ratings are maintained. The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. The transaction's legal structure and framework is bankruptcy remote, in line with S&P's legal criteria. S&P said, "Our credit and cash flow analysis indicates that the available credit enhancement for the class B-R to D-R notes could withstand stresses commensurate with higher rating levels than those we have assigned. However, as the CLO will be in its reinvestment phase starting from closing, during which the transaction's credit risk profile could deteriorate, we have capped our ratings assigned to the notes. "For the class F-R notes, our credit and cash flow analysis indicates that the available credit enhancement could withstand stresses commensurate with a lower rating. However, we have applied our 'CCC' rating criteria, resulting in a 'B- (sf)' rating on this class of notes. The ratings uplift for the class F-R notes reflects several key factors, including: -- The class F notes' available credit enhancement, which is in the same range as that of other CLOs S&P has rated and that has recently been issued in Europe. -- The portfolio's average credit quality, which is similar to other recent CLOs. -- S&P's model generated break-even default rate at the 'B-' rating level of 24.08% (for a portfolio with a weighted-average life of 4.59 years), versus if it was to consider a long-term sustainable default rate of 3.1% for 4.59 years, which would result in a target default rate of 14.23%. -- S&P does not believe that there is a one-in-two chance of this note defaulting. -- S&P does not envision this tranche defaulting in the next 12-18 months. S&P said, "Following this analysis, we consider that the available credit enhancement for the class F notes is commensurate with the assigned 'B- (sf)' rating. "Taking the above factors into account and following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that the assigned ratings are commensurate with the available credit enhancement for all the rated classes of notes. "In addition to our standard analysis, to provide an indication of how rising pressures among speculative-grade corporates could affect our ratings on European CLO transactions, we have also included the sensitivity of the ratings on the class A-R to E-R notes based on four hypothetical scenarios. "As our ratings analysis makes additional considerations before assigning ratings in the 'CCC' category, and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met, we have not included the above scenario analysis results for the class F-R notes." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit or limit assets from being related to certain industries. Since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." The transaction securitizes a portfolio of primarily senior secured leveraged loans and bonds and will be managed CVC Credit Partners Investment Management Ltd. Ratings list Amount Indicative Credit Class Rating* (mil. EUR) interest rate§ enhancement (%) A-R AAA (sf) 259.250 3/6-month EURIBOR + 1.33% 39.00 B-R AA (sf) 48.875 3/6-month EURIBOR + 1.95% 27.50 C-R A (sf) 25.500 3/6-month EURIBOR + 2.30% 21.50 D-R BBB- (sf) 29.750 3/6-month EURIBOR + 3.25% 14.50 E-R BB- (sf) 21.250 3/6-month EURIBOR + 5.65% 9.50 F-R B- (sf) 12.750 3/6-month EURIBOR + 8.51% 6.50 Subordinated NR 39.925 N/A N/A *The ratings assigned to the class A-R and B-R notes address timely interest and ultimate principal payments. The ratings assigned to the class C-R, D-R, E-R, and F-R notes address ultimate interest and principal payments. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. NR--Not rated. N/A--Not applicable. EURIBOR--Euro Interbank Offered Rate. FROSN-2018: DBRS Cuts Class E Notes Rating to CC ------------------------------------------------ DBRS Ratings GmbH took the following credit rating actions on the commercial mortgage-backed floating-rate notes due May 2031 (the Notes) issued by FROSN-2018 DAC (the Issuer): -- Class RFN confirmed at AAA (sf) -- Class A1 downgraded to A (low) (sf) from A (sf) -- Class A2 downgraded to BBB (low) (sf) from BBB (sf) -- Class B downgraded to BB (high) (sf) from BBB (low) (sf) -- Class C downgraded to B (high) (sf) from BB (sf) -- Class D downgraded to CCC (sf) from B (low) (sf) -- Class E downgraded to CC (sf) from CCC (sf) The trend on the Class RFN notes is Stable while the trends on the Class A1 through Class D notes are Negative. The Class E notes no longer carry a trend. CREDIT RATING RATIONALE The credit rating actions follow a review of the transaction's performance over last year, including the amount of disposal proceeds applied to the Notes. The aggregate sales price has been below market values, as determined in the last available market report dated March 2023. The resulting value erosion in the underlying collateral resulted in the downgrades. The transaction is a securitization of one floating-rate senior commercial real estate loan jointly advanced by Citibank, N.A., London Branch; Morgan Stanley Bank, N.A.; and Morgan Stanley Principal Funding, Inc. At issuance, the collateral securing the loan consisted of 63 predominantly secondary office and retail properties across Finland. The assets constituted a noncore part of Sponda Ltd.'s (Sponda) portfolio. Sponda was one of the largest listed real estate firms in Finland before The Blackstone Group L.P. acquired and delisted it in 2017. The quality of the portfolio securing the loan deteriorated after Sponda sold some of the stronger properties and changing office demand fundamentals led to persistent high vacancy rates. The senior loan failed to repay at maturity in February 2023 and was subsequently transferred into special servicing. The special servicer provided short-term standstill agreements to pursue a consensual workout strategy until December 2023, when noteholders passed a series of extraordinary resolutions modifying certain basic terms of the facility agreement. These resolutions included an extension of the original senior loan maturity date by an initial three years to 15 February 2026 with an option to extend the loan further to 15 February 2027 subject to certain conditions being met, such as hedging in place and no event of default. The final note maturity date of the Notes was also extended by three years to 21 May 2031 from 21 May 2028. After the amendments were executed, the loan became a corrected loan. Sponda is undertaking a portfolio disposal process and has disposed of 15 properties since the loan restructuring, with 27 properties currently remaining in the portfolio. Therefore, the market value of the 27 properties remaining in the portfolio is EUR 298.4 million based on Jones Lang LaSalle Limited's (JLL) valuation report as of March 2023 (vacant possession value of EUR 194.2 million), a 68.5% drop on a like-for-like basis from EUR 435.6 million at issuance. The properties sold in 2024 and 2025 show an aggregate sales price that was 5.1% below the market value as listed in the latest valuation report although 6.7% above the aggregate ALA of the sold properties, based on the updated post-restructuring ALA schedule. Following loan restructuring, the servicer is no longer obligated to call for annual revaluation. Instead, any individual noteholder has the right to require the servicer to mandate a valuation so long as there is no less than 12 months between each valuation. As of June 2025, no valuation was instructed. As of May 2025, the loan balance had reduced to EUR 273.2 million from EUR 303.4 million at the last annual review because the proceeds from the disposal of 15 properties sold in 2024 and 2025 were applied as partial repayment on the loan. Disposal cash proceeds are allocated to the credit of the cash trap account until the account balance reaches EUR 10.0 million, after which disposal proceeds are applied sequentially toward repayment of the loan. As of May 2025, EUR 9.7 million was trapped in the cash trap account. This translated into a reported loan-to-value ratio of 88.3% in May 2025, a slight increase from 87.1% the year before, which gives credit to cash held in the cash trap account. The portfolio performance has continued to deteriorate over the past 12 months. Based on Morningstar DBRS' calculation, annual contracted rent declined 3.6% on a like-for-like basis to EUR 33.3 million in May 2025 from EUR 34.6 million in May 2024. According to the last investor reporting as of May 2025, the vacancy rate increased by four percentage points over the past 12 months to 54.4% from 51.5%. The debt yield slightly increased to 7.7% in May 2025 from 7.3% a year earlier, mainly due to the deleveraging of the loan. As structural headwinds continue to weigh on the secondary office space, Morningstar DBRS is monitoring for potential further deterioration in the portfolio's performance. Morningstar DBRS revised its net cash flow (NCF) assumption to EUR 17.2 million to account for the 15 properties disposed, compared with EUR 20.4 million at the last annual review. In addition, Morningstar DBRS maintained its capitalization (cap) rate assumption at 9.5%, which it had already increased at the last annual review to reflect the distressed portfolio value. These changes translate to a Morningstar DBRS Value of EUR 181.4 million, representing a -39.2% haircut to JLL's most recent valuation. Additionally, Morningstar DBRS is closely monitoring the transaction with respect to the sales process, and delays in the disposal process could negatively affect the credit ratings. The loan carries a floating interest rate equal to three-month Euribor (subject to a zero floor) plus a 3.95% margin per annum (p.a.), hedged with a prepaid interest rate cap provided by HSBC Bank Plc with a strike rate of 4.25% p.a. The cap agreement terminates on 15 February 2026. The transaction includes the reserve fund notes (RFN), which fund the note share part (95%) of the liquidity reserve. At issuance, the EUR 16.7 million RFN proceeds and the EUR 879,000 vertical risk retention (VRR) loan interest contribution were deposited into the transaction's liquidity reserve, which can be used to pay property protection advances, senior costs, and interest shortfalls (if any) in relation to the corresponding VRR loan interest, RFN, Class A1, Class A2, and Class B notes. The liquidity reserve currently amounts to EUR 7.2 million and is, according to Morningstar DBRS' analysis, equivalent to approximately 12 months' coverage on the covered notes based on the interest rate cap strike rate of 4.25%. Notes: All figures are in euros unless otherwise noted. HARVEST CLO XXXVI: S&P Assigns B- (sf) Rating to Class F Notes -------------------------------------------------------------- S&P Global Ratings assigned credit ratings to Harvest CLO XXXVI DAC's class A, B, C, D, E, and F notes. At closing, the issuer also issued unrated subordinated notes. Under the transaction documents, the rated notes will pay quarterly interest, unless a frequency switch event occurs. Following such an event, the notes would permanently switch to semiannual payments. The portfolio's reinvestment period ends 4.50 years after closing; the non-call period ends 1.5 years after closing. The ratings reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The experience of the collateral manager's team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which are in line with S&P's counterparty rating framework. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,681.15 Default rate dispersion 548.07 Weighted-average life (years) 4.91 Obligor diversity measure 107.56 Industry diversity measure 24.60 Regional diversity measure 1.16 Transaction key metrics Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 0.00 Target 'AAA' weighted-average recovery (%) 36.89 Target floating-rate assets (%) 97.74 Target weighted-average coupon 4.89 Target weighted-average spread (net of floors; %) 3.61 S&P said, "The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, we have conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. "In our cash flow analysis, we used the EUR500 million target par amount, the covenanted targeted weighted-average spread (3.58%), and the covenanted targeted weighted-average coupon (3.25%), as indicated by the collateral manager. We assumed the target weighted-average recovery rates at all rating levels. We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios, for each liability rating category. "Our credit and cash flow analysis shows that the class B to class E notes benefit from break-even default rate and scenario default rate cushions that we would typically consider to be in line with higher ratings than those assigned. However, as the CLO is still in its reinvestment phase, during which the transaction's credit risk profile could deteriorate, we have capped our ratings on the notes. The class A and F notes can withstand stresses commensurate with the assigned ratings." Until Jan. 15, 2030, when the reinvestment period ends, the collateral manager may substitute the assets in the portfolio, as long the CDO Monitor test is maintained or improved in relation to the initial ratings on the notes. This test looks at the total amount of losses that the transaction can sustain, as established by the initial cash flows for each rating, and compares that with the current portfolio's default potential, plus par losses to date. As a result, until the end of the reinvestment period, the collateral manager may, through trading, cause the transaction's credit risk profile to deteriorate. S&P said, "Under our structured finance sovereign risk criteria, we consider that the transaction's exposure to country risk is sufficiently mitigated at the assigned ratings. "The transaction's documented counterparty replacement and remedy mechanisms adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "The transaction's legal structure and framework is bankruptcy remote, in line with our legal criteria. "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe our ratings are commensurate with the available credit enhancement for the class A to F notes. "In addition to our standard analysis, to indicate how rising pressures among speculative-grade corporates could affect our ratings on European CLO transactions, we also assessed the sensitivity of our ratings on the class A to E notes, based on four hypothetical scenarios. "As our ratings analysis includes additional considerations to be incorporated before we would assign ratings in the 'CCC' category--and we would assign a 'B-' rating if the criteria for assigning a 'CCC' category rating are not met--we have not included the above scenario analysis results for the class F notes." Environmental, social, and governance S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit assets from being related to certain industries. Accordingly, since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Ratings list Balance Credit Indicative Class Rating* (mil. EUR) enhancement (%) interest rate§ A AAA (sf) 305.00 39.00 Three/six-month EURIBOR plus 1.35% B AA (sf) 60.00 27.00 Three/six-month EURIBOR plus 1.85% C A (sf) 30.00 21.00 Three/six-month EURIBOR plus 2.30% D BBB- (sf) 35.00 14.00 Three/six-month EURIBOR plus 3.30% E BB- (sf) 22.50 9.50 Three/six-month EURIBOR plus 5.70% F B- (sf) 15.00 6.50 Three/six-month EURIBOR plus 8.24% Sub. NR 36.50 N/A N/A *The ratings assigned to the class A and B notes address timely interest and ultimate principal payments. The ratings assigned to the class C, D, E, and F notes address ultimate interest and principal payments. §The payment frequency permanently switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. EURIBOR--Euro Interbank Offered Rate. NR--Not rated. N/A--Not applicable. Sub.--Subordinated. OCP EURO 2025-13: Fitch Assigns 'B-sf' Final Rating to Cl. F Notes ------------------------------------------------------------------ Fitch Ratings has assigned OCP EURO CLO 2025-13 DAC final ratings, as detailed below. Entity/Debt Rating Prior ----------- ------ ----- OCP EURO CLO 2025-13 DAC Class A XS3078510081 LT AAAsf New Rating AAA(EXP)sf Class A loan LT AAAsf New Rating AAA(EXP)sf Class B XS3078510248 LT AAsf New Rating AA(EXP)sf Class C XS3078510917 LT Asf New Rating A(EXP)sf Class D XS3078511139 LT BBB-sf New Rating BBB-(EXP)sf Class E XS3078511303 LT BB-sf New Rating BB-(EXP)sf Class F XS3078511642 LT B-sf New Rating B-(EXP)sf Subordinated Notes XS3078512293 LT NRsf New Rating NR(EXP)sf Transaction Summary OCP EURO CLO 2025-13 DAC is a securitisation of mainly senior secured obligations (at least 90%) with a component of senior unsecured, mezzanine, second-lien loans and high-yield bonds. Note proceeds have been used to fund a portfolio with a target par of EUR400 million. The portfolio is actively managed by Onex Credit Partners Europe LLP. The CLO has an approximately 4.6-year reinvestment period and a nine-year weighted average life (WAL) test covenant. KEY RATING DRIVERS Average Portfolio Credit Quality (Neutral): Fitch assesses the average credit quality of obligors at 'B'. The Fitch-weighted average rating factor of the identified portfolio is 23.8. High Recovery Expectations (Positive): At least 90% of the portfolio comprises senior secured obligations. Fitch views the recovery prospects for these assets as more favourable than for second lien, unsecured and mezzanine assets. The Fitch-weighted average recovery rate of the identified portfolio is 63.4%. Diversified Portfolio (Positive): The transaction includes four Fitch test matrices, of which two are effective at closing. The matrices correspond to a top 10 obligor concentration limit at 20%, fixed-rate obligation limits at 5% and 12.5%, and a nine-year WAL covenant. It has two forward matrices corresponding to the same top 10 obligors and fixed-rate limits, and an eight-year WAL covenant. The forward matrices will be effective 12 months after closing, provided that the collateral principal amount (defaults at Fitch-calculated collateral value) is at least at the reinvestment target balance and subject to confirmation by Fitch. The transaction also includes various concentration limits, including a maximum exposure to the three largest Fitch-defined industries at 40%. These covenants ensure that the asset portfolio will not be exposed to excessive concentration. Portfolio Management (Neutral): The transaction has an approximately 4.6-year reinvestment period, which is governed by reinvestment criteria that are similar to those of other European transactions. Fitch's analysis is based on a stressed-case portfolio with the aim of testing the robustness of the transaction structure against its covenants and portfolio guidelines. Cash Flow Modelling (Positive): The WAL for the Fitch stress portfolio is 12 months shorter than the WAL covenant. This is to account for strict reinvestment conditions envisaged by the transaction after its reinvestment period, which include coverage test satisfaction and the Fitch 'CCC' bucket limitation test after reinvestment and a WAL covenant that gradually steps down, both during and after the reinvestment period. Fitch believes these conditions reduce the effective risk horizon of the portfolio during the stress period. 'CCC' Test: The Fitch 'CCC' test condition can be altered to a maintain-or-improve basis, but only if the manager switches back to the closing matrix (subject to satisfying the collateral quality tests) from the forward matrix, effectively unwinding the benefit from the one-year reduction in the Fitch-stressed portfolio WAL. If the manager has not switched to the forward matrix, which includes satisfying the target par condition, the transaction will not be able to switch back and move to a Fitch 'CCC' test maintain-or-improve basis. Fitch believes strict satisfaction of the Fitch 'CCC' test is more effective at preventing the manager from reinvesting and extending the WAL, than maintaining and improving the Fitch 'CCC' test. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A 25% increase of the mean default rate (RDR) across all ratings and a 25% decrease of the recovery rate (RRR) across all ratings of the identified portfolio would have no impact on the class A, B and C notes, would lead to one-notch downgrades for the class D and E notes and to below 'B-sf' for the class F notes. Based on the identified portfolio, downgrades may occur if the loss expectation is larger than initially assumed, due to unexpectedly high levels of default and portfolio deterioration. Due to the better metrics and shorter life of the identified portfolio than the Fitch-stressed portfolio, the classes B, D, E, and F display rating cushions of two notches and class C notes of three notches. Should the cushion between the identified portfolio and the Fitch-stressed portfolio be eroded either due to manager trading or negative portfolio credit migration, a 25% increase of the mean RDR across all ratings and a 25% decrease of the RRR across all ratings of the Fitch-stressed portfolio would lead to downgrades of up to four notches for the notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A 25% reduction of the mean RDR across all ratings and a 25% increase in the RRR across all ratings of the Fitch-stressed portfolio would lead to upgrades of up to two notches for the class B, C, D and F notes and up to three notches for the class E notes. The class A notes are already rated 'AAAsf', which is the highest level on Fitch's scale and cannot be upgraded. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY OCP EURO CLO 2025-13 DAC The majority of the underlying assets or risk presenting entities have ratings or credit opinions from Fitch and/or other Nationally Recognized Statistical Rating Organizations 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 or information on the risk presenting entities. Overall, and together with any assumptions referred to above, 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. ESG Considerations Fitch does not provide ESG relevance scores for OCP EURO CLO 2025-13 DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. RIVER GREEN 2020: DBRS Cuts Class B Notes Rating to BB ------------------------------------------------------ DBRS Ratings GmbH downgraded its credit ratings on all classes of commercial mortgage-backed floating-rate notes due January 2032 (the Notes) issued by River Green Finance 2020 DAC (the Issuer) as follows: -- Class A to BBB (sf) from A (high) (sf) -- Class B to BB from (sf) BBB (high) (sf)c -- Class C to B (low) (sf) from BB (high) (sf) -- Class D to CCC (sf) from B (high) (sf) All trends remain Negative. CREDIT RATING RATIONALE The credit rating downgrades followed Morningstar DBRS' review of the transaction's performance and considering the information published in the Regulatory News Service (RNS) notice dated 27 June 2025. The RNS disclosed an updated property valuation revealing a substantial value decline and appraisal reduction. Morningstar DBRS revised its assumption of the capitalization rate, resulting in the downgrade of all classes of Notes. The transaction is the securitization of a floating-rate commercial real estate loan that is split into two different facilities (Facility A and Facility B), both advanced by Goldman Sachs International Bank (GSIB) for the purpose of acquiring the River Ouest office building by a group of investors led by LRC Real Estate Limited (the Sponsor). The EUR 35.8 million Facility A was advanced to four ring-fenced compartments of LRC RE-2, a Luxembourg-reserved alternative investment fund with variable share capital (the Facility A Borrowers), while facility B was advanced to a French Organisme de Placement Collectif Immobilier, a real estate investment company with variable capital (the Facility B Borrower). The Issuer purchased the loan using the proceeds from the Notes' issuance (95.0% of the purchase price) and from an Issuer loan advanced by GSIB (5.0% of the purchase price). The senior loan is secured by River Ouest, a single campus-style office property built by HRO Group in 2009 on the right bank of the River Seine in the Bezons municipality in the western suburb of Paris. It comprises a seven-storey office building and an adjacent two-storey service/amenity building. A major business district, La Défense, is approximately five kilometers southeast of the asset. The property has served as the global headquarters of a French information technology service provider, Atos SE (Atos), since its completion in 2009. As of the April 2025 interest payment date (IPD), Atos contributed 84.7% to the property's gross rental income (GRI), with another tenant, EMC2, contributing to the remaining 15.3% of the GRI. Atos' lease expires in July 2030 with a no-break option, offering 5.3 years of unexpired lease term. As of April 2025, Atos continues to pay rent at contracted levels, although it carries forward arrears in relation to its portion of the building management expenses and service charges for a total of EUR 2.9 million, down from EUR 3.9 million at the previous quarter. EMC2 remained in occupation after its lease expired in September 2023 and continued to pay rent as per the term of the original lease. However, EMC2 will vacate at the end of September 2025. Therefore, the property's vacancy rate will increase to 17.2% and Atos will be the only tenant remaining. Atos faced significant financial challenges during 2024 and entered accelerated safeguard proceedings in July 2024. In December 2024 Atos concluded a comprehensive financial restructuring and approved an operational plan, inclusive of a reduction in total headcount of around 10,000 scheduled by 2027. In the latest valuation report dated March 2025, Cushman & Wakefield (C&W) assumed that upon lease expiry Atos will renew its lease at the market rental rate for only 33% of its currently occupied area. According to the valuation the current market rent is EUR 200 per square meter (sqm), lower than Atos' current rent of EUR 330 per sqm. The C&W valuation of the property dated 31 March 2025 reported a market value of EUR 139.1 million and a vacant possession value of EUR 35.2 million. The current market value is equivalent to a 54.7% decline from the previous EUR 307 million valuation (CBRE Limited, 31 January 2023) and to a 59.5% drop from the valuation at cut off. In terms of lettability, the valuer indicated 25 months as the estimated period to re-let vacant space at market rent with an estimated 44 months of free rent as an incentive package on a nine-year term. This is mainly due to the drop in attractiveness of the suburbs around Paris and in locations with weak transportation connections, especially after the coronavirus pandemic. Regarding current saleability of the property, the valuer indicated very limited investment activities in the area because it is not attractive to tenants. The initial three-year loan was scheduled to mature on 15 January 2023, with two one-year extension options available to the borrower. The second and last extension option was not exercised, and the loan matured on 15 January 2024. As the borrower failed to repay, the loan was transferred into special servicing on 16 January 2024. Subsequently, the special servicer consented to certain modifications to, and waivers of, the terms of the loan finance documents. These loan amendments took effect on 6 August 2024. As part of the agreed modifications, the maturity date of the loan was extended to April 2026 with the possibility of one further year extension to April 2027, provided that at such time no loan default is continuing or would result from such extension. The borrower pays an interest of three-month Euribor over a margin of 2.4% per annum (p.a.). A hedging agreement with a strike rate of 5.0% p.a. is in place until April 2027. There was no change in the priority of payments, with receipts continuing to be applied sequentially to the notes. Class X payments are diverted, and excess interest available funds are applied to pay down the senior notes. Following the restructuring, the loan is in cash sweep. The borrower has prepaid EUR 7 million since August 2024, and the outstanding loan amount stood at EUR 180.9 million as of the April 2025 IPD. As part of the amendments, the loan-to-value ratio (LTV) covenant has been waived until April 2026, and the debt yield financial covenant ceased to apply. Additionally, at restructuring, the Sponsor deposited an amount of EUR 10.0 million, which can be used for servicer-approved asset management initiatives or loan repayment. Any unused amount will be applied to repay the loan on the initial termination date in April 2026. As of April 2025, this amount remained unchanged. As of the April 2025 IPD, the debt service coverage ratio stood at 1.54 times based on a loan margin of 2.4%, a cap rate of 5%, and reported net rental income (NRI) of EUR 25.3 million. NRI increased by 5.0% on a year-over-year basis to EUR 25.3 million in April 2025 from EUR 24.0 million in April 2024. Morningstar DBRS did not update its net cash flow (NCF) assumption, which was last revised in May 2024, when its vacancy assumption increased to 17.2% from 15% and the market rent assumption was adjusted to incorporate the anticipated downward pressure on rental cash flow. Currently, the Morningstar DBRS stabilized NCF of EUR 14.2 million is slightly below the valuer's assumptions of EUR 14.6 million. In this review, Morningstar DBRS increased its cap rate assumption to 10% from 7.5% to account for the capital investment needed in a rent-free incentive package, and void costs during a prolonged letting scenario. This cap rate is in line with the net reversionary yield and discount rate used in the latest valuation report. This results in a Morningstar DBRS Value of EUR 141.6 million, down from EUR 188.8 million at last review. The Morningstar DBRS LTV increased to 127.8%, up from 95.8% at last review. The transaction benefited from a liquidity reserve facility of EUR 10.1 million in April 2025 (EUR 11.3 million at origination) provided by Crédit Agricole Corporate and Investment Bank. The liquidity facility covers the Class A through Class C Notes as well as the Issuer loan. However, following the reduction in the market value of the property, the special servicer has determined that an appraisal reduction has occurred in the sum of EUR 55,763,767, and the appraisal reduction factor is 69.18%. Consequently, the liquidity commitment is reduced to EUR 7.0 million. Morningstar DBRS estimates that the liquidity amount based on the reduced commitment is equivalent to approximately 9 months of coverage based on 5.0% strike rate. The final legal maturity of the Notes is on 22 January 2032, reflecting a shorter tail period of less than five years instead of the seven years at issuance, considering the loan extension agreed in August 2024. Morningstar DBRS' credit ratings on the applicable classes address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. The associated financial obligations for each of the rated notes are the related interest payment amounts and the related class balances. Notes: All figures are in euros unless otherwise noted. RRE 27 LOAN: S&P Assigns BB- (sf) Rating to Class D Notes --------------------------------------------------------- S&P Global Ratings assigned its credit ratings to RRE 27 Loan Management DAC's class A-1 to D notes. At closing, the issuer also issued unrated performance, preferred return, and subordinated notes. This is a European cash flow CLO transaction, securitizing a portfolio of primarily senior secured leveraged loans and bonds. The transaction is managed by Redding Ridge Asset Management (UK) LLP. The ratings assigned to RRE 27 Loan Management DAC's notes reflect S&P's assessment of: -- The diversified collateral pool, which primarily comprises broadly syndicated speculative-grade senior secured term loans and bonds that are governed by collateral quality tests. -- The credit enhancement provided through the subordination of cash flows, excess spread, and overcollateralization. -- The collateral manager's experienced team, which can affect the performance of the rated notes through collateral selection, ongoing portfolio management, and trading. -- The transaction's legal structure, which is bankruptcy remote. -- The transaction's counterparty risks, which is in line with S&P's counterparty rating framework. Under the transaction documents, the rated notes will pay quarterly interest unless there is a frequency switch event. Following this, the notes will permanently switch to semiannual payments. The portfolio's reinvestment period will end approximately 4.5 years after closing, and the portfolio's maximum average maturity date is approximately 9 years after closing. Portfolio benchmarks S&P Global Ratings' weighted-average rating factor 2,773.29 Default rate dispersion 479.07 Weighted-average life including reinvestment(years) 5.10 Obligor diversity measure 99.36 Industry diversity measure 17.02 Regional diversity measure 1.22 Transaction key metrics Total par amount (mil. EUR) 400 Defaulted assets (mil. EUR) 0 Number of performing obligors 127 Portfolio weighted-average rating derived from S&P's CDO evaluator B 'CCC' category rated assets (%) 1.44 Target 'AAA' weighted-average recovery (%) 36.76 Actual portfolio weighted-average spread (%) 3.69 Actual portfolio weighted-average coupon (%) 4.28 S&P said, "The portfolio is well-diversified, primarily comprising broadly syndicated speculative-grade senior secured term loans and senior secured bonds. Therefore, we have conducted our credit and cash flow analysis by applying our criteria for corporate cash flow CDOs. As such, we have not applied any additional scenario and sensitivity analysis when assigning ratings to any class of notes in this transaction. "In our cash flow analysis, we used the EUR400 million target par amount, the actual weighted-average spread (3.69%), and the actual weighted-average coupon (4.28%). We applied various cash flow stress scenarios, using four different default patterns, in conjunction with different interest rate stress scenarios for each liability rating category. "Our credit and cash flow analysis indicates that the available credit enhancement for the class A-2, B, C, and D notes could withstand stresses commensurate with higher ratings than those assigned. However, as the CLO will be in its reinvestment phase starting from closing, during which the transaction's credit risk profile could deteriorate, we have capped the assigned ratings. "The transaction's documented counterparty replacement and remedy mechanisms to adequately mitigate its exposure to counterparty risk under our current counterparty criteria. "Following the application of our structured finance sovereign risk criteria, we consider the transaction's exposure to country risk to be limited at the assigned ratings, as the exposure to individual sovereigns does not exceed the diversification thresholds outlined in our criteria. "The transaction's legal structure to be bankruptcy remote, in line with our legal criteria. "Following our analysis of the credit, cash flow, counterparty, operational, and legal risks, we believe that our assigned ratings are commensurate with the available credit enhancement for the class A-1, A-2, B, C, and D notes. "In addition to our standard analysis, we have also included the sensitivity of the ratings on the class A-1 to D notes to four hypothetical scenarios.” Environmental, social, and governance factors S&P said, "We regard the exposure to environmental, social, and governance (ESG) credit factors in the transaction as being broadly in line with our benchmark for the sector. Primarily due to the diversity of the assets within CLOs, the exposure to environmental credit factors is viewed as below average, social credit factors are below average, and governance credit factors are average. For this transaction, the documents prohibit or limit assets from being related to certain industries. Since the exclusion of assets from these industries does not result in material differences between the transaction and our ESG benchmark for the sector, no specific adjustments have been made in our rating analysis to account for any ESG-related risks or opportunities." Ratings Amount Credit Class Rating* (mil. EUR) enhancement (%) Interest rate§ A-1 AAA (sf) 244.00 39.00 Three/six-month EURIBOR plus 1.33% A-2 AA (sf) 40.00 29.00 Three/six-month EURIBOR plus 1.75% B A (sf) 32.00 21.00 Three/six-month EURIBOR plus 2.15% C BBB- (sf) 28.00 14.00 Three/six-month EURIBOR plus 3.00% D BB- (sf) 18.50 9.38 Three/six-month EURIBOR plus 5.40% Performance Notes NR 1.00 N/A N/A Preferred return notes NR 0.25 N/A N/A Subordinated Notes NR 43.23 N/A N/A *The ratings assigned to the class A-1 and A-2 notes address timely interest and ultimate principal payments. The ratings assigned to the class B, C, and D notes address ultimate interest and principal payments. §The payment frequency switches to semiannual and the index switches to six-month EURIBOR when a frequency switch event occurs. NR--Not rated. N/A--Not applicable. EURIBOR--Euro Interbank Offered Rate. ========= I T A L Y ========= BCC 2019: DBRS Confirms CC Rating on Class B Notes -------------------------------------------------- DBRS Ratings GmbH took the following credit rating actions on the notes issued by BCC NPLs 2019 S.r.l. (the Issuer): -- Class A Notes downgraded to CCC (high) (sf) from B (low) (sf) -- Class B Notes confirmed at CC (sf) The trend on the Class A Notes remains Negative, while the Class B Notes do not carry a trend The transaction represents the issuance of Class A, Class B, and Class J Notes (collectively, the Notes) backed by a mixed pool of Italian nonperforming secured and unsecured loans originated by 68 Italian banks (collectively, the Originators). The credit rating on the Class A Notes addresses the timely payment of interest and the ultimate repayment of principal. The credit rating on the Class B Notes addresses the ultimate payment of principal and interest. Morningstar DBRS does not rate the Class J Notes. The gross book value (GBV) of the loan pool was approximately EUR 1.32 billion as of the 31 December 2018 selection date. The securitized portfolio is composed of secured loans representing approximately 73.8% of the GBV and unsecured loans representing the remaining 26.2%. Residential and industrial real estate properties represent 44.2% and 16.2% of the pool by first-lien real estate value, respectively. The receivables are serviced by doValue S.p.A. (the Special Servicer). The master servicer is doNext S.p.A., while Banca Finanziaria Internazionale S.p.A. (Banca Finint) has been appointed as backup servicer. CREDIT RATING RATIONALE The credit rating actions follow Morningstar DBRS' review of the transaction and are based on the following analytical considerations: -- Transaction performance: An assessment of portfolio recoveries as of December 2024 focusing on (1) a comparison between actual collections and the Special Servicer's initial business plan forecast, (2) the collection performance observed over recent months, and (3) a comparison between the current performance and Morningstar DBRS' expectations. -- Updated business plan: The Special Servicer's updated business plan as of December 2024, received in June 2025, and the comparison with the initial collection expectations. -- Portfolio characteristics: Loan pool composition as of December 2024 and the evolution of its core features since issuance. -- Transaction liquidating structure: The order of priority, which entails a fully sequential amortization of the notes (i.e., the Class B Notes will begin to amortize following the full repayment of the Class A Notes, and the Class J Notes will amortize following the repayment of the Class B Notes). Additionally, interest payments on the Class B Notes become subordinated to principal payments on the Class A Notes if the cumulative collection ratio (CCR) or present value cumulative profitability ratio (PV ratio) is lower than 90%. The CCR trigger has been breached since the July 2024 interest payment date (IPD). The actual figures for the CCR and PV ratio were at 68.2% and 106.9% as of the January 2025 IPD, respectively, according to the Special Servicer. -- Liquidity support: The transaction benefits from an amortizing cash reserve providing liquidity to the structure and covering potential interest shortfall on the Class A Notes and senior fees. The cash reserve target amount is equal to 3.0% of the Class A Notes' principal outstanding balance, and the recovery expenses cash reserve target amounts to EUR 150,000, both fully funded. TRANSACTION AND PERFORMANCE According to the latest investor report from January 2025, the outstanding principal amounts of the Class A, Class B, and Class J Notes were EUR 197.1 million, EUR 53.0 million, and EUR 13.2 million, respectively. As of January 2025, the balance of the Class A Notes had amortized by 44.5% since issuance, and the current aggregated transaction balance was EUR 263.3 million. As of December 2024, the transaction was performing below the Special Servicer's business plan expectations. The actual cumulative gross collections equaled EUR 239.6 million, whereas the Special Servicer's initial business plan estimated cumulative gross collections of EUR 334.6 million for the same period. Therefore, as of December 2024, the transaction was underperforming by EUR 95.1 million (28.4%) compared with the initial business plan expectations. At issuance, Morningstar DBRS estimated cumulative gross collections for the same period of EUR 227.4 million at the BBB (sf) stressed scenario and EUR 312.3 million at the CCC (sf) stressed scenario. Therefore, as of December 2024, the transaction was performing above Morningstar DBRS' initial stressed expectations in the BBB (sf) scenario, but below its expectations in the CCC (sf) scenario. Pursuant to the requirements set out in the receivable servicing agreement, in June 2025, the Special Servicer delivered an updated portfolio business plan. The updated portfolio business plan, combined with the actual cumulative gross collections of EUR 239.6 million as of December 2024, resulted in a total of EUR 508.3 million. This is 21.4% lower than the total gross disposition proceeds of EUR 646.8 million estimated in the initial business plan. Excluding actual collections as of December 2024, the Special Servicer's expected future collections from January 2025 amount to EUR 268.7 million. The updated Morningstar DBRS credit rating stress assumes a haircut of 8.4% in the CCC (high) (sf) stressed scenario to the Special Servicer's updated business plan, considering future expected collections from January 2025. In Morningstar DBRS' CCC (sf) (or below) scenarios, the updated Special Servicer forecast was adjusted only in terms of actual collections to the date and timing of future expected collections. Considering the underperformance of cumulative actual collections, the Special Servicer's downward revision of the expected collections, as well as increased legal and procedural costs, the uncertainty regarding full repayment of the Class A Notes is increasing. Morningstar DBRS therefore downgraded the credit rating on the Class A Notes to CCC (high) (sf) and maintained the Negative trend. Morningstar DBRS observes that the full repayment of the Class B Notes is highly unlikely. But considering the transaction structure and the characteristics of the Class B Notes, as defined in the transaction documents, Morningstar DBRS notes that a default would most likely be recognized only at the maturity or early termination of the transaction. The transaction's final maturity date is in January 2044. Morningstar DBRS' credit ratings on the applicable classes address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. Where applicable, a description of these financial obligations can be found in the transactions' respective press releases at issuance. Notes: All figures are in euros unless otherwise noted. RINO MASTROTTO: Fitch Affirms B+ LT IDR, Alters Outlook to Negative ------------------------------------------------------------------- Fitch Ratings has revised Rino Mastrotto Group S.p.A.'s (RMG) Outlook to Negative from Stable, while affirming its Long-Term Issuer Default Rating (IDR) at 'B+'. Fitch has also affirmed its senior secured EUR320 million notes (SSN) at 'BB-', with a Recovery Rating of 'RR3'. The Negative Outlook reflects weaker-than-expected performance in 2024 and 5M25, alongside subdued recovery prospects for the rest of the year. Fitch, therefore, expects RMG's leverage to be above its 4.5x negative sensitivity in 2025 and 2026, contrary to its previous expectations of gradual deleveraging to below the threshold by end-2025. Continued underperformance over the next 12-18 months could lead to a downgrade to 'B'. RMG's IDR reflects its niche-scale operations and customer concentration, which are balanced by its entrenched role as a supplier of customised intermediate leather and textile products to premium and luxury clients in fashion, automotive and mobility, and interior design. It also has a resilient business model with strong EBITDA margins and sustained positive free cash flow (FCF). Key Rating Drivers Sluggish Performance Delays Deleveraging: The Negative Outlook reflects its view of continued underperformance across all segments so far in 2025, which will result in leverage being above 4.5x until 2027, longer than previously expected. A strong order backlog in the luxury and automotive segments supports a modest recovery in 2H25, versus 1H25, but not enough to avoid a leverage breach of the negative sensitivity. Fitch assumes that revenue in the luxury segment will fall by a low single-digit percentage and in the automotive segment by a high single-digit percentage. However, Fitch expects this to be offset by new business from the Prada Group, resulting in flat overall organic revenue and EBITDA at best. As a result, Fitch expects leverage in 2025 to be around 5.4x and about 5.0x in 2026. Further underperformance, including the effects of US tariffs, without visibility of potential recovery in the short term would put the rating under further pressure and could result in a downgrade to 'B'. Partnership with Prada Positive: The decision by the Prada Group to buy a 10% stake in RMG announced in June 2025 will contribute positively to the latter through provision of two plants along with a cash injection, but also add some operating company debt. The full year revenue contribution from this business is estimated at around EUR50 million. This investment demonstrates a strengthening partnership with the Prada Group, which is one of RMG's main customers in the luxury segment. The collaboration will also provide access to new clients for RMG. Sustained Positive FCF: Fitch projects sustained, moderately positive FCF, supported by modest EBITDA margin expansion, contained capex needs (maintenance capex and overall capex at 1% and 3%-4% of revenue, respectively, until 2028), manageable interest expense and limited working capital outflows. Fitch estimates FCF margins will be in the low-single digits in 2025, before rising to the mid-single digits by end-2028. This will support the company's rating at the upper end of the 'B' category. Weakening FCF generation would put the ratings under pressure. Cost Management Supports Profitability Improvement: RMG has optimised input costs and passed on costs increases to customers by regularly renegotiating selling prices in the luxury segment and by price mechanisms within contracts in the automotive segment. The company also plans to improve profitability, use a more efficient tanning process and increasingly source certain production processes in-house. This should contribute to a mild margin improvement towards 19% by 2028, from 18.3% in 2024, although Fitch slightly moderated its profitability expectations given higher than expected market-related top line risks leading to a slightly lower cost absorption. Narrow Product Range; Bespoke Offering: RMG's rating reflects its narrow product range with 90% of 2024 EBITDA from leather, 8% from textile and components, and the remainder from value-added services. The limited product offering is partially balanced by a bespoke product approach, which supports high customer retention and longstanding customer relationships. Top clients in the luxury segment have low incentives to change suppliers due to high customisation and low price sensitivity. In the automotive segment, client retention spans the lifecycle of car models of five-to-seven-years on average. Entrenched Position in Niche Luxury: RMG's business risk profile benefits from long-lasting relationships with global premium and luxury fashion companies and automotive original equipment manufacturers, and Fitch expects this trend to continue. Concentration risk stems from its top five clients accounting for 34% of 2023 revenue, but Fitch views the risk of customer loss as very low. RMG's longstanding relationships with its top clients in the luxury and automotive segment span 14-20 years and the company has a 99% retention rate in its luxury creation business. Material Exposure to Luxury Sector: Premium and luxury fashion, which accounted for 51% of RMG's revenue in 2024, is generally more resilient to economic downturns but not completely immune to pronounced and extended macro-economic uncertainty, as seen in 2024 and 2025. The strategic switch to the luxury sector has allowed RMG to diversify its exposure away from the more cyclical automotive business, which accounted for 32% of 2024 revenue. Fitch expects the automotive segment to start recovering from 2027 and the luxury segment to return to modest growth from 2026, once market uncertainty eases. Bolt-on Acquisitions Part of Strategy: RMG has expanded organically, complemented by several smaller M&A, some of which were debt-funded. Fitch expects the company to continue making small add-on acquisitions by reinvesting around EUR10 million-15 million of FCF a year in 2026-2028, aimed at internalising certain production processes. Material debt-funded transformative M&As are not part of its rating case and will be treated as an event risk. Peer Analysis Fitch does not rate direct peers of RMG, which acts as a supplier in consumer products manufacturing rather than a manufacturer of final products. However, Fitch compares it with Flos B&B Italia S.p.A. (B/Negative), which shares certain similar credit factors and is partly exposed to the industries of fashion and interior design. RMG is rated above Flos B&B Italia (previously known as IDG), a high-end lighting and furniture producer, which is bigger in scale and more diversified by products. This is balanced by RMG's broadly similar EBITDA margins but stronger expected FCF margins and lower projected leverage at 5.4x in 2025 versus Flos B&B Italia's above 6.0x in 2025-2026 due to weak consumer sentiment resulting in flat-to contracting revenue and EBITDA. Fitch also views RMG's operations as more resilient to economic downturns, due to its exposure to luxury fashion and its established long-term relationships with key customers. Key Assumptions Fitch's Key Assumptions within Its Rating Case for the Issuer - Organic revenue to decline moderately in 2025, followed by flat revenues in 2026 and average annual increases of about 4.8% in 2027-2028 - EBITDA at 18.5% of gross revenue (including other income) in 2025, gradually increasing to 18.9% in 2028 - Capex at average 3.8% of revenue over 2025-2028 - M&A spending of about EUR10 million-15 million a year from 2026 to 2028 - Restricted cash of EUR25 million to operate the business Recovery Analysis Key Recovery Assumptions The recovery analysis assumed that RMG will be considered a going concern (GC) rather than liquidated in bankruptcy given its strong market position and long-term relationship with customers. Fitch assumed a 10% administrative claim and EUR34 million of securitisation (drawn amount at end-2024), which Fitch estimates will remain available during restructuring due to the strong credit profile of its clients. The estimated GC EBITDA of EUR57 million, up from EUR55 million last year, due to the contribution from Prada Group, reflects the level of earnings required for the company to sustain operations as a GC in unfavourable market conditions of shrinking volumes and with an inability to adjust the cost base. Fitch assumed a 5.5x enterprise valuations/EBITDA multiple, reflecting RMG's healthy operating margins, inherently cash generative operations and attractive medium to longer-term luxury segment fundamentals. This multiple is below Flos B&B Italia's 6.0x, due to the latter's larger scale. Prior ranking operating company debt consists of EUR36 million of commercial credit lines, new debt contributed by the Prada Group and other operating company debt. RMG's senior secured debt consists of a EUR50 million super senior revolving credit facility (RCF) due in 2031 (six months before the SSNs) and EUR320 million of SSNs due in 2031. The RCF is prior-ranking and, in accordance with Fitch's rating criteria, is assumed to be fully drawn prior to distress. Its waterfall analysis generates a ranked recovery for the SSNs in the 'RR3' band, indicating a 'BB-' rating, one notch above the IDR. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA leverage exceeding 4.5x on a sustained basis - EBITDA interest coverage below 3.0x - FCF margin below 4% on a sustained basis - Cash flow from operations less capex/debt below 7% Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade An upgrade is unlikely in the medium term given the limited scale of the company. Increased revenue base, lower customer concentration and EBITDA materially above EUR100 million will be considerations for a positive rating action, in combination with: - EBITDA leverage below 3.0x on a sustained basis - EBITDA interest coverage above 4.0x - FCF margin sustained in the high single digits Liquidity and Debt Structure At end-1Q25, RMG had EUR20 million of unrestricted cash on its balance sheet and a EUR50 million RCF, which Fitch expects to remain fully undrawn for 2025-2028. The company has access to EUR36 million of commercial credit lines, which were mainly undrawn at end-1Q25. Fitch projects a continuous build-up of cash, leading to year-end freely available cash in excess of EUR100 million by end-2028, supported by positive FCF generation, from which Fitch deducts EUR25 million as the minimum cash amount required for daily operations. All this leads to a comfortable liquidity position. RMG has a concentrated debt structure, with its debut EUR320 million SSNs due in 2031. The EUR50 million RCF matures six months before the notes. It has no major maturities before the SSNs come due. Issuer Profile RMG is an Italian manufacturer of customised leather and textile intermediate products for luxury fashion houses, automotive and mobility and interior design industries. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Rino Mastrotto Group S.p.A. LT IDR B+ Affirmed B+ senior secured LT BB- Affirmed RR3 BB- =================== L U X E M B O U R G =================== PLATIN2025 INVESTMENTS: S&P Affirms 'B' ICR, Outlook Neg. --------------------------------------------------------- S&P Global Ratings affirmed its 'B' long-term issuer credit rating and 'B' issue-level rating on Platin2025 Investments S.a.r.l. (Syntegon) and its senior secured notes; the '3' recovery rating on the notes is unchanged. The negative outlook remains unchanged, reflecting the delay in deleveraging and the risk that the company will not reduce its leverage to below 6.5x by the end of 2025. Platin2025 Investments S.a.r.l. (Syntegon) reported a stronger first quarter of 2025 year over year. Revenue increased by EUR47 million to EUR403 million and reported EBITDA rose by about EUR18 million to EUR49 million compared with the same period in 2024. S&P said, We expect further improvement throughout 2025, supported by our expectation of a material decline in restructuring charges. As a result, we expect Syntegon will reduce its high leverage to less than 6.5x in 2025 from 8.6x in 2024; we view this as in line with the rating. "Due to materially higher restructuring charges than budgeted in recent years, we consider the group's credit metrics remain fragile as long as it does not achieve our forecast financial performance or meet its own budget on a full-year basis. "We expect Syntegon's leverage will decline to below 6.5x in 2025 from 8.6x in 2024. We anticipate debt to EBITDA will be about 6x in 2025, falling to below 5.5x in 2026. Due to materially higher restructuring charges than the company budgeted in recent years, the company needs to demonstrate its ability to reduce leverage to below 6.5x over a full year and on a sustainable basis. We do not expect any shareholder-friendly actions in the next two years. However, we do not rule out Syntegon taking advantage of bolt-on acquisitions financed by cash holdings to expand the scope of its business. S&P Global Ratings-adjusted debt in 2025 includes EUR1.1 billion of the Term Loan B (TLB) maturing in 2028, about EUR60 million of reciprocal lending, about EUR23 million of lease liabilities, and about EUR18 million of trade receivables (unchanged from 2024). We do not net cash and short-term investments against debt, given the company's financial sponsor ownership. "Syntegon reported stronger results in the first quarter of 2025 on a like-for-like basis, and we expect this trend to continue for the full year. Syntegon reported a stronger first quarter 2025 year over year, with revenue increasing by EUR47 million to EUR403 million and reported EBITDA by about EUR18 million to EUR49 million compared with the same period in 2024. We expect the group will benefit from the supportive obesity and liquids business in the pharma segment and the acquisition of Telstar. After a transition period involving many changes to management, we believe the group has stabilized and its transformative plan will continue. We therefore forecast the group will increase revenue by about 10% to about EUR1,750 million in 2025, reflecting the stronger order backlog of EUR1,475 million in the first quarter of 2025, and will generate EUR210 million-EUR230 million of S&P Global Ratings-adjusted EBITDA. "We expect positive free operating cash flow (FOCF) generation in 2025 and 2026. Since 2022, overall inflation and working capital requirements have significantly affected FOCF, reflecting supply chain issues, particularly the availability of machine parts such as electrical components. This resulted in negative S&P Global Ratings-adjusted FOCF of about EUR60 million in 2022 and about EUR33 million in 2023. Since then, management has mostly resolved these issues. Furthermore, we expect capital expenditure (capex) of EUR40 million-EUR50 million per year in 2025 and 2026 (including about EUR15 million of capitalized costs each year), compared with about EUR40 million in 2024 at 2.5%-3% of sales. We expect a negative change in working capital of about EUR20 million in 2025 and EUR10 million in 2026, compared with positive EUR83 million in 2024. We therefore expect the group to generate S&P Global Ratings-adjusted FOCF of EUR40 million-EUR70 million per year in 2025 and 2026, compared with about EUR68 million in 2024. The group's capacity to generate positive FOCF is a key factor in our analysis, and successive years of negative FOCF could put further pressure on the rating." Liquidity remains comfortable, benefiting from a long-dated debt maturity profile. Syntegon's sufficient liquidity position supports the rating. As of March 31, 2025, the group's liquidity sources more than covered its cash outlay for the following 12 months. Syntegon's liquidity is underpinned by its cash balance of about EUR163 million and at least EUR169 million available under its revolving credit facility (RCF). In addition, the group has a long-dated debt maturity profile, with no material maturities until 2028, and should benefit from the EUR40 million for the sale of real estate in Germany and EUR10 million for the sale of real estate in the U.S. The leverage covenant is tested only if the RCF is drawn, net of cash, by more than 40%, which S&P does not expect under its base-case scenario. S&P said, "We expect relatively little impact from the uncertainty around the new U.S. administration's tariff policies. We estimate that Syntegon generates about 32% of revenue from the Americas (about EUR516 million in 2024,) with the U.S. alone accounting for about EUR400 million. We understand that the group is currently managing to pass through higher costs to customers. Furthermore, most of the competition in the pharma segment comes from outside the U.S. and would be equally impacted. We understand that the group also has local production in the U.S., which will be further optimized to balance the growing U.S. exposure. The group consolidated four U.S. sites for new equipment at New Richmond, Decatur, Minneapolis, and Allendale into one at New Richmond at the end of 2024. We therefore view tariff risks as manageable for the company. S&P Global Ratings believes there is a high degree of unpredictability around policy implementation by the U.S. administration and possible responses--specifically with regard to tariffs--and the potential effect on economies, supply chains, and credit conditions around the world. As a result, our base-line forecasts carry a notable amount of uncertainty. As situations evolve, we will gauge the macro and credit materiality of potential and actual policy shifts and reassess our guidance accordingly. "The negative outlook reflects slower-than-expected deleveraging and limited headroom under the rating. We expect Syntegon will generate an S&P Global Ratings-adjusted EBITDA margin of above 12% in 2025. At the same time, we expect adjusted debt to EBITDA to decrease to about 6.0x in 2025 and then fall below 5.5x by the end of 2026. We expect that FOCF will be positive in 2025 and 2026, and that funds from operations (FFO) cash interest coverage will trend towards 2.0x over that period. "We could lower the rating if Syntegon's operating performance fell short of our expectations or if the company raised more debt than we expected, leading to debt to EBITDA of more than 6.5x." S&P could also lower the rating if: -- FFO cash interest coverage remains below 2.0x; -- Syntegon cannot generate positive adjusted FOCF; -- The company is unable to improve its profitability and reach an EBITDA margin recovering toward 12% by the end of 2025. S&P could revise the outlook to stable if Syntegon were to improve debt to EBITDA below 6.5x, supported by positive FOCF, an adjusted EBITDA margin trending toward 12%, and FFO cash interest coverage above 2x. =========== R U S S I A =========== NATIONAL BANK: Fitch Puts 'BB' Final Rating to Sr. Unsec. Eurobonds ------------------------------------------------------------------- Fitch Ratings has assigned JSC National Bank for Foreign Economic Activity of the Republic of Uzbekistan's (NBU) USD300 million 7.2% senior unsecured Eurobonds due 17 July 2030 and UZS1.5 trillion 17.95% senior unsecured Eurobonds due 17 July 2028 final ratings of 'BB'. Fitch has also assigned the bonds ex-government support (xgs) long-term ratings of 'B+(xgs)'. The assignment of the final ratings follows the receipt of documents conforming to information already received. The final ratings are the same as the expected ratings (see 'Fitch Rates National Bank of Uzbekistan's Upcoming Eurobonds 'BB(EXP)'' published on 7 July 2025). Key Rating Drivers The notes' ratings are in line with NBU's Long-Term Foreign-Currency (FC) Issuer Default Rating (IDR) of 'BB', as they represent unconditional, senior unsecured obligations of the bank, which rank pari passu with its other senior unsecured obligations. For the soum-denominated bonds, the coupon payments and principal repayment are required to be made in US dollars at the soum/US dollar exchange rate reported by the Central Bank of Uzbekistan at each settlement date. The issue terms do not contain an option allowing NBU to make settlements on the bonds in soum. Fitch would therefore treat a situation when the bank is unable to meet its US dollar obligations on the soum-denominated bonds (whether for issuer-specific reasons or because of broader transfer or convertibility restrictions) as an event of default. Fitch also highlights the soum-denominated bonds' embedded market risk from the perspective of US dollar investors. NBU's Long-Term FC IDR reflects Fitch's view of a moderate probability of state support, as reflected by its 'bb' Government Support Rating. Its assessment of support for NBU considers its majority state ownership, high systemic importance, an important policy role as the key lender to strategic industries, and the low cost of support relative to the sovereign's international reserves. The bonds' documentation includes a change of control clause, under which bondholders will have an option to redeem the notes at par if the Republic of Uzbekistan ceases to beneficially own (directly or indirectly) 50% plus 1 share of NBU's issued and outstanding voting capital stock. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The senior unsecured debt ratings could be downgraded if NBU's Long-Term FC IDR was downgraded. Sensitivities for NBU's Long-Term IDRs are outlined in Fitch's latest rating action commentary dated 30 June 2025. NBU's senior unsecured ratings (xgs) would be downgraded if its Long-Term FC IDR (xgs) was downgraded. The bank's Long-Term IDRs (xgs) are sensitive to changes to its Viability Rating. Sensitivities for NBU's Viability Rating are outlined in Fitch's rating action commentary dated 26 March 2025. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade NBU's senior unsecured debt ratings could be upgraded if the Long-Term FC IDR was upgraded. NBU's senior unsecured ratings (xgs) would be upgraded if the bank's Long-Term FC IDR (xgs) was upgraded. Date of Relevant Committee 27 June 2025 Public Ratings with Credit Linkage to other ratings NBU's Long-Term IDRs are directly linked to Uzbekistan's sovereign IDR. ESG Considerations NBU has an ESG Relevance Score of '4' for Governance Structure as Uzbekistan's authorities are highly involved in the bank at board level and in its business and strategy development, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- JSC National Bank for Foreign Economic Activity of the Republic of Uzbekistan senior unsecured LT BB New Rating BB(EXP) senior unsecured LT (xgs) B+(xgs) New Rating B+(xgs)(EXP) =========== T U R K E Y =========== SEKERBANK T.A.S: Fitch Affirms 'CCC(EXP)' Rating on AT1 Notes ------------------------------------------------------------- Fitch Ratings has affirmed Sekerbank T.A.S.'s (Sekerbank; B/Positive/b) planned additional Tier 1 (AT1) capital notes' expected rating at 'CCC(EXP)' and assigned a Recovery Rating (RR) of 'RR6'. The size of the issuance is not yet determined but is expected to be about USD200 million. The final rating is subject to the receipt of the final documentation conforming to information already received by Fitch. Key Rating Drivers The rating assigned to the notes is three notches below Sekerbank's 'b' Viability Rating, in accordance with Fitch's Bank Rating Criteria. Fitch has notched the debt rating three times from Sekerbank's VR (twice for loss severity and only once for non-performance risk), instead of the baseline four notches, due to rating compression, as Sekerbank's VR is below the 'BB-' anchor rating threshold. The 'RR6' Recovery Rating reflects poor recovery prospects in a default. The notes will be Basel-III compliant, perpetual, deeply subordinated, fixed rate resettable AT1 debt securities. The notes will have fully discretionary non-cumulative interest payments and be subject to full or partial write-down if the issuer or group's common equity Tier 1 (CET1) ratio falls below 5.125%. The principal write-down can be reinstated and written-up at the issuer's discretion if a positive distributable net profit is recorded. The notes will also be subject to permanent partial or full write-down, on the occurrence of a non-viability event (NVE). An NVE is when it becomes probable that the bank will become non-viable as determined by the local regulator, the Banking and Regulatory Supervision Authority (BRSA). The bank will be deemed non-viable should it reach the point at which the BRSA determines its operating license is to be revoked and the bank liquidated or the rights of the bank's shareholders (except to dividends), and the management and supervision of the bank, are transferred to the Savings Deposit Insurance Fund on the condition that losses are deducted from the capital of existing shareholders. The notes will have no fixed maturity, although Sekerbank will have the option (subject to BRSA approval) to repay the notes from the fifth anniversary of the issue date to and including the first reset date, or on any interest payment date thereafter. Sekerbank's consolidated regulatory CET1 and Tier 1 ratios were 18.4% at end-1Q25, including regulatory forbearance on foreign-currency risk-weighted assets, well above its regulatory minimum requirements of 7.0% and 8.5%, respectively. Rating Sensitivities Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade As the notes are notched down from Sekerbank's VR, their rating is sensitive to a downgrade of the VR. The notes' rating is also sensitive to an unfavourable revision of Fitch's assessment of incremental non-performance risk. This may result, for example, from a sharp decline in capital buffers relative to regulatory requirements. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade The notes' rating is sensitive to an upgrade of Sekerbank's VR. ESG Considerations Sekerbank T.A.S. has an ESG Relevance Score of '4' for Management Strategy due to {DESCRIPTION OF ISSUE/RATIONALE}, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Sekerbank T.A.S. Subordinated LT CCC(EXP) Affirmed RR6 CCC(EXP) =========================== U N I T E D K I N G D O M =========================== AMBER HOLDCO: Fitch Affirms 'B+' Long-Term IDR, Outlook Stable -------------------------------------------------------------- Fitch Ratings has affirmed Amber HoldCo Limited's (Applus) Long-Term Issuer Default Rating (IDR) at 'B+' with a Stable Outlook. Fitch has also affirmed the senior secured rating of the financing subsidiary Amber Finco Plc at 'BB-', with a Recovery Rating of 'RR3'. The rating is constrained by high leverage, due to the recent term loan B (TLB) add-on to fund bolt-on M&As. Rating strengths are the group's solid business profile in the testing, inspection and certification sector, which benefits from limited cyclicality, sound customer diversification, longstanding customer relationships, low customer churn and a strong brand. The Stable Outlook reflects Fitch's expectation that Applus will generate a solid free cash flow (FCF) margin of about 1.5% in 2025, rising to around 3% by 2026. This will help support deleveraging, despite further anticipated bolt-on acquisitions to expand into new markets. Key Rating Drivers High Leverage Constrains Rating: Fitch forecasts EBITDA leverage at 6.2x at end-2025, which is high for the rating and above the negative rating sensitivity of 6.0x. The increase in leverage follows the group's EUR275 million term loan B (TLB) add-on in June 2025, which was used to repay amounts drawn under a revolving credit facility and to fund future M&As. This will lift average EBITDA gross leverage by 0.4x during 2025-2028 from its previous forecast. Fitch still expects the group to deleverage steadily, with leverage falling within the negative sensitivity by end-2026 and potentially improving to 5.2x by 2028. This will be driven by EBITDA growth from higher revenue and operational improvements, with the EBITDA margin projected to reach 16% in 2028. Slower-than-expected deleveraging would put pressure on the ratings. Solid FCF Expected: Fitch expects Applus to generate a solid FCF margin of about 1.5% in 2025, rising to around 3% by 2026. This is supported by expected EBITDA growth, flat capex and fairly low working-capital outflows. Fitch expects the group to prioritise deleveraging over shareholder returns and do not expect any dividend payments to be made outside those as part of the IDIADA concession. Continued Acquisitions: Fitch expects some of the group's FCF to be directed towards bolt-on acquisitions in emerging markets with higher organic growth prospects. Fitch expects acquisitions will align with Applus's long-term strategy of enhancing its global footprint and consolidating its leadership in key markets. Execution risk is moderate, as Applus has made larger acquisitions since 1996, while improving profitability in a decentralised organisational framework. Fitch does not forecast any large, debt-funded acquisitions. Solid Revenue Growth: Revenue increased 8.1% year on year to EUR557 million in 1Q25, with higher revenue across all its four divisions. This follows a revenue increase of 7.3% in 2024, as the group continues to benefit from positive industry trends, which are driving increased demand for services across several sub-sectors, such as cybersecurity, electric vehicles and advanced driver assistance. Fitch expects the increase to continue. Growth will also be supported by the continuation of the group's bolt-on M&A strategy, with four acquisitions completed since it was privatised. Sound Business Diversification: Applus's solid business profile is supported by strong service offerings, broad end-market diversification, a reputation for technical expertise, and committed and skilled employees. The regulations to encourage transition towards a low-emission economy also underpins demand for Applus's services in the energy and automotive markets. Its business profile is further supported by a fairly high share of contracted but short-term revenue for mission-critical, non-discretionary services, which supports resilience against end-market cyclicality. Concentration in Europe: Europe accounts for 53% of Applus's overall revenue, with 23% generated in the group's home market of Spain. This is partially offset by the diversification of Applus's end-markets but continues to limit its organic growth potential in these mature markets. Fitch expects the group to diversify further into emerging markets through bolt-on acquisitions, but that Europe will remain its largest market. Resilient Performance Through the Cycle: Fitch views Applus's business model as resilient, as demonstrated during the Covid-19 pandemic and periods of high inflation in 2022. Demand for the group's services has accelerated due to a stronger focus on energy transition, with further electrification, and regulation in Europe. Applus has maintained a high customer retention rate of close to 80% over the past 10 years across some divisions. Peer Analysis Applus does not have direct Fitch-rated peers. Instead, Fitch compares Applus with peers within the broader business services market portfolio rated by Fitch, such as Assemblin Caverion Group AB (B/Positive), Polygon Group AB (B/Negative), Irel BidCo S.a.r.l. (B+/Stable) and Albion HoldCo Limited (BB-/Stable). Applus's forecast EBITDA gross leverage of 6.2x at end-2025 is weaker than that of similarly rated peers, such as Assemblin, Irel BidCo S.a.r.l. and Albion HoldCo. However, Applus's ability to generate solid FCF is a rating strength, reflecting its asset-light business model and aligning with the 'BBB' rating category for the service sector. Applus's contract length is shorter than that of some service companies. However, having extended the IDIADA contract, its contract tenor is aligned with the 'BB' rating median. Applus also has more diversified market coverage than 'B' rating category peers, such as Assemblin and Polygon, which are exposed to construction or building material industries that can be more cyclical. Key Assumptions Fitch's Key Assumptions Within Its Rating Case for the Issuer - Revenue CAGR of 4.1% for 2025-2028, supported by organic growth and bolt-on M&As - Steady improvement in EBITDA margin to 16% in 2028, driven by business-mix changes and operational improvements - Net working capital outflows averaging 0.6% of revenue during 2025-2028 - Annual capex equivalent to 4% of revenue - Bolt-on M&As of EUR100 million in 2025, declining to EUR80 million a year during 2026-2028 - No shareholder returns outside dividends related to IDIADA concession Recovery Analysis - The recovery analysis assumes Applus would be reorganised as a going concern in bankruptcy rather than liquidated. - Fitch assumes a 10% administrative claim. - Total debt is EUR1.9 billion (EUR1,075 million TLB after the June 2025 add-on, EUR895 million senior secured notes, EUR200 million senior secured RCF and EUR54 million of other debt, all ranking equally among themselves). - Fitch uses Fitch-adjusted EBITDA of EUR250 million to reflect its view of a sustainable, post-reorganisation EBITDA on which Fitch bases the enterprise valuation. - Fitch uses a multiple of 5.5x to estimate the going-concern EBITDA to reflect the group's post-reorganisation enterprise value. The multiple incorporates Applus's solid business profile in a resilient sector that has limited cyclicality, good customer diversification, high customer retention rates and its position as one of the leading companies operating in the sector. - The allocation of value in the liability waterfall results in recovery corresponding to 'RR3' for the senior debt facilities. RATING SENSITIVITIES Factors That Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Shortening of contract length or reduced renewal rates affecting revenue visibility - EBITDA gross leverage above 6x - FCF margin below 1% - EBITDA Interest cover below 2.5x; all on a sustained basis Factors That Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Increasing the share of long-term contracted businesses, extending the average contract length, and improving revenue visibility - EBITDA gross leverage below 5x - FCF margin above 3%; all on a sustained basis Liquidity and Debt Structure At 31 March 2025, the group reported EUR116 million in cash on its balance sheet, prior to Fitch's adjustment of EUR33 million for cash that is not readily available. Following the June 2025 TLB add-on, it also has an undrawn EUR200 million revolving credit facility. Forecast positive FCF generation provides additional liquidity over the medium term and is likely to be sufficient to cover further bolt-on acquisitions. Most of the group's debt consists of the EUR1,075 million TLB and EUR895 million senior secured floating-rate notes. These facilities mature in four years, resulting in no material scheduled debt repayments until July 2029. Issuer Profile Applus is a global leader in testing, inspection and certification sector with a broad range of regulatory and safety-driven services across four divisions: energy and industry, automotive, IDIADA and laboratories. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Amber Finco Plc senior secured LT BB- Affirmed RR3 BB- Amber Holdco Limited LT IDR B+ Affirmed B+ AXIS LOGISTICS: Teneo Financial Named as Joint Administrators ------------------------------------------------------------- Axis Logistics Limited was placed into administration proceedings in the High Court of Justice, Business and Property Courts of England and Wales Court Number: CR-2025-004566, and Kristian Shuttleworth, Clare Boardman and Paul James Meadows of Teneo Financial Advisory Limited, were appointed as joint administrators on July 7, 2025. Axis Logistics specialized in freight transport by road. Its registered office is at c/o Teneo Financial Advisory Limited, The Colmore Building, 20 Colmore Circus Queensway, Birmingham, B46AT. Its principal trading address is at Harvest House, Horizon Business Village, 1 Brooklands Road, Weybridge, KT13 0TJ. The joint administrators can be reached at: Kristian Shuttleworth Clare Boardman Paul James Meadows Teneo Financial Advisory Limited The Colmore Building 20 Colmore Circus Queensway Birmingham, B4 6AT Further details contact: The Joint Administrators Email: praxcreditors@teneo.com Alternative contact: Jack Crutchley FINSBURY 2025-1: Fitch Assigns 'B+sf' Final Rating to Class F Debt ------------------------------------------------------------------ Fitch Ratings has assigned Finsbury Square 2025-1 PLC (FSQ25-1) final ratings, as detailed below. Entity/Debt Rating Prior ----------- ------ ----- Finsbury Square 2025-1 PLC A XS3073599014 LT AAAsf New Rating AAA(EXP)sf B XS3073599873 LT AAsf New Rating AA(EXP)sf C XS3073600044 LT Asf New Rating A(EXP)sf D XS3073600390 LT BBB+sf New Rating BBB+(EXP)sf E XS3073600986 LT BBB-sf New Rating BBB-(EXP)sf F XS3073601018 LT B+sf New Rating B+(EXP)sf G XS3073601281 LT NRsf New Rating NR(EXP)sf Z XS3073601521 LT NRsf New Rating NR(EXP)sf Transaction Summary FSQ25-1 is a static securitisation of owner-occupied (OO) and buy-to-let (BTL) mortgage loans originated by Kensington Mortgage Company Ltd (KMC). The portfolio consists of new originations and loans that were previously securitised in KMC transactions under the Finsbury Square and Gemgarto RMBS shelf programmes, which were rated by Fitch. KEY RATING DRIVERS Mixed Specialist Prime Originations: The pool consists of new and seasoned OO and BTL loans, with about 72% originated before 2023. This results in a Fitch-calculated weighted average (WA) sustainable loan-to-value (sLTV) of 80.6%, a WA indexed current loan-to-value (CLTV) of 71.5%, a WA debt-to-income ratio of 32.8% and a WA interest coverage ratio of 90.7%. KMC takes a manual underwriting approach, targeting borrowers that may not meet the criteria of high-street lenders' automated scorecard models. This approach attracts a higher portion of first-time buyers, self-employed individuals and borrowers with adverse credit histories than typical prime UK OO lenders. To account for this, Fitch has applied a transaction adjustment of 1.2x to foreclosure frequency (FF) for the prime OO loans, factoring in the performance of KMC's OO book data and prior transactions. A 1.1x transaction adjustment was also applied to FF for the BTL loans, reflecting the historical performance of KMC's BTL book data and previous transactions. Negative Selection, High Arrears: The loans in the portfolio have not been selected randomly and include those with high indexed CLTV (85% and above), representing 32% of the portfolio, and loans in arrears (22.2%, with 10.9% in late-stage arrears). Late-stage arrears have been increasing in KMC's book, due partly to a Mortgage Charter application slowing repossession, and in previous KMC securitisations, as eligible borrowers switch products at the end of their fixed-rate period and exit the pool, leading to a concentration of weaker borrowers. Ratings Below Model-Implied Levels: The ratings of the class B to F notes have been constrained at one notch below their model-implied ratings. This reflects limited headroom at their model-implied ratings and the potential for further deterioration in the performance of the collateral pool due to negative selection, future loan reversions and cost-of-living challenges across the UK, stretching borrower affordability. It also factors in rising arrears and a possible rise in WAFF. Alternative Prepayment Rates, Hedging Schedule: At closing, 95.2% of the loans pay a fixed interest rate (eventually reverting to floating), while the notes pay a SONIA-linked, floating rate. The issuer has entered into a swap at closing to mitigate the interest rate risk arising from the fixed-rate mortgages in the pool. The swap features a notional balance based on the projected amortisation profile of the fixed-rate loans, which could lead to over-hedging owing to higher defaults or prepayments and lower available revenues in a decreasing interest rate scenario. Fixed-rate loans are subject to early repayment charges. The point at which these loans are scheduled to revert from a fixed to the relevant follow-on rate will likely determine the time of prepayments. Fitch has, therefore, applied an alternative high prepayment stress that tracks the fixed-rate reversion profile of the pool. The prepayment rate applied is floored at 10%-15% and capped at a maximum of 40% a year. Self-Employed Borrowers: Prime lenders assessing borrower affordability typically require a minimum of two years of income information and apply a two-year average, or, if income is declining, the lower income amount. KMC's underwriting practices permit underwriters' discretion in using the latest year's income if it is going up. Fitch, therefore, applied an increase of 30% to FF for self-employed borrowers with verified income, instead of the 20% increase typically applied under its UK RMBS Rating Criteria to the OO sub-pool only. Self-employed borrowers constitute 37.6% of the OO sub-pool and 55.9% of the pool. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The transaction's performance may be affected by changes in market conditions and the economic environment. Weakening economic performance is strongly correlated to rising levels of delinquencies and defaults that could reduce the credit enhancement available to the notes. In addition, unexpected declines in recoveries could result in lower net proceeds, which may make some notes' ratings susceptible to negative rating action, depending on the extent of the decline in recoveries. Fitch found that a 15% increase in the WAFF and a 15% decrease in the WA recovery rate (RR) would lead to downgrades of one notch for the class A notes, two notches each for the class B and C notes, three notches on the class D notes and four notches on the class E notes. The class F notes would be assigned distressed ratings in this scenario. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Stable-to-improved asset performance driven by stable delinquencies and defaults would lead to higher credit enhancement levels and, potentially, upgrades. Fitch found a lowering in the WAFF of 15% and a rise in the WARR of 15% would lead to upgrades of no more than one notch for the class B notes, four notches for the class C notes and more than one rating category each for the class D to F notes. The class A notes are at the highest achievable rating on Fitch's scale and cannot be upgraded. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC 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 and concluded that there were no findings that affected the rating analysis. Fitch conducted a review of a small, targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for its rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. Date of Relevant Committee 24 June 2025 ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. HONK HONK: Antony Batty Named as Administrators ----------------------------------------------- Honk Honk Group Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-004618, and William Antony Batty and James Stares of Antony Batty & Company LLP, were appointed as administrators on July 7, 2025. Honk Honk Group specialized in business and domestic software development. Its registered office is at Suite 1, 2nd Floor, Dean Park House, 8-10 Dean Park Crescent, Bournemouth, BH1 1HL. The administrators can be reached at: William Antony Batty James Stares Antony Batty & Company LLP 3 Field Court, Gray's Inn London, WC1R 5EF For further details contact: Sushmita Adhikari Tel No: 020 7831 1234 E-mail: sushmita@antonybatty.com MB HEALTHCARE: CMB Partners Named as Administrators --------------------------------------------------- MB Healthcare Services Ltd, trading as MB Healthcare, was placed into administration proceedings in the High Court of Justice Court Number: CR-2025-004679, and Adam Price and Lane Bednash of CMB Partners UK Limited, were appointed as administrators on July 9, 2025. MB Healthcare Services specialized in general medical practice activities. Its registered office and principal trading address is at 14 Station Close, Potters Bar, EN6 1TL. The administrators can be reached at: Adam Price Lane Bednash CMB Partners UK Limited 49 Tabernacle Street London EC2A 4AA Further details contact: The Administrators Tel: 020 7377 4370 Email: info@cmbukltd.co.uk Alternative contact: Ellis Brealey PAVILLION 2022-1: Fitch Affirms 'Bsf' Rating on Class E Notes ------------------------------------------------------------- Fitch Ratings has upgraded Pavillion Mortgages 2022-1 PLC's class B and D notes and affirmed the rest. Fitch has removed all ratings from Under Criteria Observation. Entity/Debt Rating Prior ----------- ------ ----- Pavillion Mortgages 2022-1 PLC Class A XS2554836507 LT AAAsf Affirmed AAAsf Class B XS2554836762 LT AAAsf Upgrade AA+sf Class C XS2554837570 LT A+sf Affirmed A+sf Class D XS2554837653 LT Asf Upgrade BBBsf Class E XS2554837737 LT Bsf Affirmed Bsf Transaction Summary Pavillion Mortgages 2022-1 PLC is a securitisation of owner-occupied mortgages originated by Barclays Bank UK PLC and backed by properties in the UK. The securitised loans are predominantly high loan-to-value (LTV) originations (85%-95%), up to and including September 2022, with 74.9% of the borrowers being first-time buyers (FTBs). KEY RATING DRIVERS UK RMBS Rating Criteria Updated: The rating actions reflect its updated UK RMBS Rating Criteria (see Fitch Ratings Updates UK RMBS Rating Criteria, dated 23 May 2025). Key changes include updated representative pool weighted average foreclosure frequencies (WAFFs), changes to sector selection, revised recovery rate assumptions and changes to cashflow assumptions. Fitch now applies dynamic default distributions and high prepayment rate assumptions, rather than static assumptions. Credit Enhancement Build-Up: The transaction has had a high level of prepayments due to fixed-to-floating reversions, which have led to considerable paydown of the pool and contributed to a credit enhancement (CE) build-up. It is further supported by a non-amortising reserve fund. CE for the class A notes increased to 31.8% from 16.6% at the July 2024 review, for the B notes to 23.2% from 12%, for the C notes to 15% from 7.7% and for the D notes to 6.8% from 3.4%. The build-up in CE supports the rating actions. Alternative Prepayment Rates: The transaction contains a high portion of fixed-rate loans subject to early repayment charges. The scheduling of the loans' reversion from a fixed rate to the relevant follow-on rate will likely determine when prepayments occur. Fitch has therefore applied an alternative high prepayment stress that tracks the fixed-rate reversion profile of the pool, with a prepayment rate floored at 5% and capped at a maximum 40% a year. Liquidity Constrains Junior Notes' Ratings: The transaction's liquidity provisions are insufficient for the class C notes and below to achieve ratings above 'A+sf', as these notes must make timely interest payments when they are the most senior class outstanding and do not have access to liquidity reserves. Therefore, the class C notes are capped at 'A+sf'. High Concentration of FTBs: Around 75% of borrowers in the portfolio are FTBs. Fitch considers that FTBs are more likely to suffer foreclosure than other borrowers and considers their concentration in this pool analytically significant. Fitch has applied an upward adjustment to foreclosure frequency (FF) of 1.4x to each loan where the borrower is an FTB, in line with its criteria. Accessibility to affordable housing for FTBs is a factor affecting Fitch's ESG scores, due to their impact on FF. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The transaction's performance may be affected by changes in market conditions and economic environment. Weakening economic performance is strongly correlated to increasing levels of delinquencies and defaults that could reduce CE available to the notes. Unanticipated declines in recoveries could also result in lower net proceeds, which may make certain note ratings susceptible to negative rating actions, depending on the decline in recoveries. A 15% increase in the WAFF and a 15% decrease in the weighted average recovery rate (WARR) would lead to downgrades of no more than two notches each for the class D and E notes. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Stable to improved asset performance driven by stable delinquencies and defaults would lead to increasing CE and, potentially, upgrades. A decrease in the WAFF of 15% and an increase in the WARR of 15% would lead to upgrades of no more than three notches for the class D notes and six notches for the class E notes. The class A, B and C notes are at the highest achievable rating on Fitch's scale and cannot be upgraded. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC 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. 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 reviewed the results of a third-party assessment conducted on the asset portfolio information before the transaction closed and concluded that there were no findings that affected the rating analysis. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied on for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Pavillion Mortgages 2022-1 PLC has an ESG Relevance Score of '4' for Human Rights, Community Relations, Access & Affordability due to the concentration of FTBs, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. POLARIS 2025-2 PLC: DBRS Gives Prov. CCC Rating to Class F Notes ---------------------------------------------------------------- DBRS Ratings Limited assigned provisional credit ratings to the residential mortgage-backed notes to be issued by Polaris 2025-2 PLC (the Issuer) as follows: -- Class A notes at (P) AAA (sf) -- Class B notes at (P) AA (high) (sf) -- Class C notes at (P) A (high) (sf) -- Class D notes at (P) BBB (sf) -- Class E notes at (P) BB (high) (sf) -- Class F notes at (P) CCC (sf) -- Class X1 notes at (P) BB (low) (sf) The provisional credit rating on the Class A notes addresses the timely payment of interest and the ultimate repayment of principal on or before the final maturity date in August 2068. The provisional credit ratings on the Class B, Class C, Class D, Class E, Class F, and Class X1 notes address the timely payment of interest once they are the most senior class of notes outstanding and, until then, the ultimate payment of interest and the ultimate repayment of principal on or before the final maturity date. Morningstar DBRS does not rate the Class Z or Class X2 notes or the residual certificates also expected to be issued in this transaction. CREDIT RATING RATIONALE The Issuer is a bankruptcy-remote special-purpose vehicle incorporated in England and Wales. The notes to be issued will fund the purchase of residential assets originated by UK Mortgage Lending Ltd (UKML). On or prior to the issue date, UK Residential Mortgages Limited (UKRML or the Seller), will acquire the beneficial title from UKML. Both UKML and UKRML are wholly owned by Pepper Money (PMB) Limited (Pepper Money). Pepper (UK) Limited (PUK) will be the appointed servicer for the transaction. Pepper Money is part of the Pepper Group Limited, a worldwide consumer finance business, third-party loan servicer, and asset manager. PUK was recently sold to J.C. Flowers & Co. in February 2025. CSC Capital Markets UK Limited will be appointed as the backup servicer facilitator for the transaction. The initial mortgage portfolio consists of GBP 480 million in first-lien owner-occupied (OO) mortgages secured by properties in the UK, excluding the prefunded pool. The transaction includes a prefunding mechanism where the Seller has the option to sell UKML-originated mortgage loans to the Issuer subject to certain conditions to prevent a material deterioration in credit quality. The acquisition of these assets will occur before the first interest payment date using the proceeds standing to the credit of the prefunding reserves. Any funds that are not applied to purchase additional loans will, (1) if standing to the credit of the prefunding principal reserve ledger, be applied pro rata to pay down the Class A to Class F and Class Z notes; or (2) if standing to the credit of the prefunding revenue reserve ledger, flow through the revenue priority of payments. The Issuer is expected to issue seven tranches of collateralized mortgage-backed securities (the Class A, Class B, Class C, Class D, Class E, Class F, and Class Z notes) to finance the purchase of the portfolio and the prefunding principal reserve ledger at closing. Additionally, the Issuer is expected to issue two classes of noncollateralized notes (the Class X1 and Class X2 notes). The transaction is structured to initially provide 13.5% of credit enhancement to the Class A notes. This includes subordination of the Class B to the Class F and the Class Z notes. The transaction features a fixed-to-floating interest rate swap, given that the majority of the pool is composed of fixed-rate loans with a compulsory reversion to floating in the future. The liabilities will pay a coupon linked to the daily compounded Sterling Overnight Index Average. Lloyds Bank Corporate Markets plc (LBCM) will be appointed as the swap counterparty at closing. Based on Morningstar DBRS' private credit ratings on LBCM, the downgrade provisions outlined in the documents, and the transaction structural mitigants, Morningstar DBRS considers the risk arising from the exposure to the swap counterparty to be consistent with the credit ratings assigned to the rated notes as described in Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology. Citibank N.A./London Branch (Citibank London) will act as the Issuer account bank and will hold the Issuer's transaction account, the liquidity reserve fund (LRF), and the swap collateral account. Barclays Bank PLC (Barclays) will be appointed as the collection account bank. Morningstar DBRS privately rates Citibank London and has a Long Term Critical Obligations Rating of AA (low) and a Long-Term Issuer Rating of "A" on Barclays, both with Positive trends. Both entities meet the eligible credit ratings in structured finance transactions and are consistent with the credit ratings assigned to the rated notes as described in Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology. Liquidity in the transaction is provided by a LRF that is amortizing and sized at 1.0% of the Class A and Class B notes' outstanding balance. The LRF covers senior costs and expenses, swap payments, and interest shortfalls for the Class A and Class B notes. The LRF will be funded through available principal funds until the LRF target amount has been transferred (disregarding LRF debits). From that date onwards, the LRF will be funded through revenue. Any liquidity reserve excess amount will be applied as available principal receipts, and the reserve will be released in full once the Class B notes are fully repaid. In addition, the Issuer can use principal to cover senior costs and expenses, swap payments, and interest on the most senior class of notes outstanding up to the Class F notes and before that, interest on the Class B notes provided the Class B principal deficiency ledger is not greater than 10% of the Class B outstanding principal amount. Principal can be used once the LRF has been exhausted. Interest shortfalls on the notes (apart from Class A), as long as they are not the most senior class outstanding, may be deferred and not be recorded as an event of default until the final maturity date or such earlier date on which the notes are fully redeemed. Morningstar DBRS based its credit ratings on a review of the following analytical considerations: -- The transaction's capital structure, including the form and sufficiency of available credit enhancement; -- The mortgage portfolio's credit quality and the servicer's ability to perform collection and resolution activities. Morningstar DBRS estimated stress-level probability of default (PD), loss given default (LGD), and expected losses (EL) on the mortgage portfolio. Morningstar DBRS used the PD, LGD, and EL as inputs into the cash flow engine and analyzed the mortgage portfolio in accordance with its "European RMBS Insight Methodology"; -- The transaction's ability to withstand stressed cash flow assumptions and repay the Class A, Class B, Class C, Class D, Class E, Class F, and Class X1 notes according to the terms of the transaction documents; -- The structural mitigants in place to avoid potential payment disruptions caused by operational risk, such as a downgrade, and replacement language in the transaction documents; -- Morningstar DBRS' sovereign credit rating on the United Kingdom of Great Britain and Northern Ireland of AA with a Stable trend as of the date of this press release; and -- The expected consistency of the transaction's legal structure with Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology and the presence of legal opinions that are expected to address the assignment of the assets to the Issuer. Notes: All figures are in British pound sterling unless otherwise noted. POLARIS 2025-2: S&P Assigns B- (sf) Rating to Class X1-Dfrd Notes ----------------------------------------------------------------- S&P Global Ratings assigned its credit ratings to Polaris 2025-2 PLC's class A and B-Dfrd to X1-Dfrd notes. At closing, the issuer also issued unrated class Z and X2 notes and residual certificates. Polaris 2025-2 is an RMBS transaction securitizing a portfolio of owner-occupied mortgage loans secured over U.K. properties. This is the tenth first-lien RMBS transaction originated by UK Mortgage Lending Ltd. that S&P has rated. The loans in the pool were originated between 2017 and 2025 by UK Mortgage Lending Ltd. The collateral comprises complex-income borrowers, borrowers with immature credit profiles, and borrowers with credit impairments, and there is a high exposure to owner-occupied mortgages advanced to self-employed borrowers (31.2%) and owner-occupied mortgages advanced to first-time buyers (34.1%). Product switches are permitted under this transaction, subject to certain conditions being met. The aggregate current balance of all product switch loans cannot exceed 25% of the pool as of closing. Liquidity support for the class A and B-Dfrd notes is provided by the liquidity reserve fund. Hence, for the other rated notes where timely interest must be paid once they become the most senior class outstanding, there is no liquidity support available. However, principal receipts can be used to pay interest, which may provide liquidity. The transaction includes a prefunded amount of 19.67% of the collateralized notes' balance, where the issuer can purchase loans until the first interest payment date in August 2025. There is the risk that the addition of these loans could adversely affect the pool's credit quality. Portfolio limitations are in place that mitigate this risk. The transaction incorporates a swap to hedge the mismatch between the notes, most of which (99.7%) pay a coupon based on the compounded daily Sterling Overnight Index Average rate, and loans, which pay fixed-rate interest before reversion. S&P's counterparty, operational risk, or structured finance sovereign risk criteria do not cap the ratings in this transaction. Ratings Class Rating Amount (mil. GBP) A AAA (sf) 519.00 B-Dfrd* AA (sf) 33.00 C-Dfrd* A+ (sf) 24.00 D-Dfrd* A- (sf) 11.40 E-Dfrd* BBB+ (sf) 5.70 F-Dfrd* BB+ (sf) 5.70 Z NR 1.20 X1-Dfrd B- (sf) 14.40 X2 NR 9.00 Residual Certs NR N/A *S&P's rating on this class considers the potential deferral of interest payments. NR--Not rated. N/A--Not applicable. RYEBECK TRADING: FRP Advisory Named as Joint Liquidators -------------------------------------------------------- Ryebeck Trading Company Ltd was placed into administration proceedings in the High Court of Justice, Business & Property Courts at Manchester, Insolvency & Companies List (ChD) Court Number: CR-2025-MAN-000946, and Kelly Burton and Joseph Fox of FRP Advisory Trading Limited, were appointed as joint liquidators on July 2, 2025. Ryebeck Trading operates in the distillery industry. Its registered office is at C/O Gravita Oxford LLP First Floor, Park Central, 40/41 Park End Street, Oxford OX1 1JD in the process of changing to c/o FRP Advisory Trading Limited, The Manor House, 260 Ecclesall Road South, Sheffield, S11 9PS. Its principal trading address is at Unit 4, White Rose Park, Goole, DN14 6XF. The joint liquidators can be reached at: Kelly Burton Joseph Fox FRP Advisory Trading Limited The Manor House 260 Ecclesall Road South, Sheffield, S11 9PS Further details contact: The Joint Liquidators Tel No: 01142356780 Alternative contact: Faye Pell Email: cp.sheffield@frpadvisory.com STRATTON 2024-2: Fitch Affirms 'BB+sf' Rating on Class F Notes -------------------------------------------------------------- Fitch Ratings has affirmed Stratton Mortgage Funding 2024-2 plc's notes and removed them from Under Criteria Observation, as detailed below. Entity/Debt Rating Prior ----------- ------ ----- Stratton Mortgage Funding 2024-2 plc A XS2777475372 LT AAAsf Affirmed AAAsf B XS2777475539 LT AA+sf Affirmed AA+sf C XS2777476776 LT A+sf Affirmed A+sf D XS2777482741 LT BBB+sf Affirmed BBB+sf E XS2777485504 LT BBB-sf Affirmed BBB-sf F XS2777487203 LT BB+sf Affirmed BB+sf Transaction Summary The transaction is a securitisation of non-prime owner-occupied (OO) and buy-to-let (BTL) mortgages backed by properties in the UK. The mortgages were primarily originated by GMAC-RFC, Irish Permanent Isle of Man, Platform Homeloans and Rooftop Mortgages, and were previously securitised in the Stratton Mortgage Funding 2021-1 plc transaction. The sponsor is Burlington Loan Management Designated Activity Company. KEY RATING DRIVERS UK RMBS Rating Criteria Updated: The rating actions reflect Fitch's updated UK RMBS Rating Criteria (see "Fitch Ratings Updates UK RMBS Rating Criteria", dated 23 May 2025). Key changes include updated representative pool weighted average foreclosure frequencies (WAFF), changes to sector selection, revised recovery rate assumptions and cash flow assumptions. The most important revision was to the non-conforming sector's representative 'Bsf' WAFF. Fitch has applied newly introduced borrower level recovery rate caps to underperforming seasoned collateral. Also, Fitch now applies dynamic default distributions and high prepayment rate assumptions, rather than the static assumptions. Transaction Adjustment: Fitch has applied its non-conforming assumptions and an OO transaction adjustment of 1.0x and BTL transaction adjustment of 1.5x to FF. This is because the transaction's historical performance of loans greater than three-months in arrears or more is slightly worse than Fitch's non-conforming index. BTL Recovery Rate Cap: The deal has reported losses that exceed the expected losses, based on the indexed value of the properties in the pool. Fitch has, therefore, applied borrower-level recovery rate (RR) caps to the BTL loans in the transaction, in line with those applied to non-conforming loans. The RR cap is 85% at 'Bsf' and 65% at 'AAAsf'. Arrears Stabilisation: One-month plus and three-month plus arrears were 31.9% and 22.5%, respectively, as of the June 2025 payment date, versus 29.6% and 19.3% a year ago. However, the number and amount of loans in arrears have fallen over the last 12 months, suggesting a reduction in arrears build-up. The risk of migration to late-stage arrears remains a big rating driver, despite a decline in the number of loans in arrears since the deal closed, in March 2024. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade The transaction's performance may be affected by adverse changes in market conditions and the economic environment. Weakening economic performance is strongly correlated to increasing delinquencies and defaults that could reduce credit enhancement available to the notes. In addition, unexpected declines in recoveries could result in lower net proceeds, which may make certain notes susceptible to negative rating action, depending on the extent of the decline in recoveries. Fitch found that a 15% increase in the WAFF and 15% decrease of the WARR would imply the following: Class A: 'AAAsf' Class B: 'AA+sf' Class C: 'A-sf' Class D: 'BB+sf' Class E: 'B+sf' Class F: 'Bsf' Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Stable to improved asset performance driven by stable delinquencies and defaults would lead to increasing credit enhancement and, potentially, upgrades. Fitch found that a 15% decrease in the WAFF and 15% increase of the WARR would imply the following: Class A: 'AAAsf' Class B: 'AAAsf' Class C: 'AA+sf' Class D: 'AAsf' Class E: 'Asf' Class F: 'A-sf' USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC 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. 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. Prior to the transaction closing, Fitch reviewed the results of a third-party assessment conducted on the asset portfolio information and concluded that there were no findings that affected the rating analysis. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for its rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Stratton Mortgage Funding 2024-2 plc has an ESG Relevance Score of '4' for Customer Welfare - Fair Messaging, Privacy and Data Security, due to the high proportion of interest-only loans in legacy OO mortgages, which has a negative impact on the credit profile and is relevant to the ratings in conjunction with other factors. Stratton Mortgage Funding 2024-2 plc has an ESG Relevance Score of '4' for Human Rights, Community Relations, Access and Affordability, due to a large proportion of the pool containing OO loans advanced with limited affordability checks, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. TAURUS 2025-4: Fitch Assigns 'BB+(EXP)sf' Rating to Class E Notes ----------------------------------------------------------------- Fitch Ratings has assigned Taurus 2025-4 UK DAC's notes expected ratings. The assignment of final ratings is contingent on the receipt of final information conforming to the reviewed documentation. Entity/Debt Rating ----------- ------ Taurus 2025-4 UK Class A LT AAA(EXP)sf Expected Rating Class B LT AA(EXP)sf Expected Rating Class C LT A-(EXP)sf Expected Rating Class D LT BBB(EXP)sf Expected Rating Class E LT BB+(EXP)sf Expected Rating Transaction Summary The transaction is a 95% securitisation of a GBP227.3 million commercial real estate loan originated by Bank of America to GoldenTree entities to support the refinancing of a portfolio comprising 36 assets across the UK. The term loan is a three-year facility with two one-year extensions, which represents a 65% loan-to-value (LTV) based on a third-party valuation of GBP349.7 million. The originator retains 5% of liabilities transferred to the issuer, in the form of an issuer loan, pari passu with the notes. KEY RATING DRIVERS Creditor-Friendly Structure: The loan limits adverse selection risk, with release pricing for the core retail and logistics assets (around 80% of the collateral) set at the higher of 120% of the allocated loan amount (ALA) and 65% of net disposal proceeds (in the first three years, the office and 'non-core' assets can be disposed of at the ALA ). In addition to cash trap triggers, the borrower covenants to maintain debt yield above 8% (10.4% from year two) and the LTV below 77.1 (74.6% after year 2), where any breach not remedied within 15 days will result in a loan default, trigger sequential principal repayment and subordinate the class X notes. Fitch considers this structure to be stronger than in many EMEA CMBS 2.0 products and applies a one-notch uplift to its ratings on model-implied results. Largely Secondary Quality Assets: The portfolio comprises 36 largely secondary quality assets in the UK with a weighted average property score of 3.7 and an average build/refurbishment year of 2008. This is mitigated by geographic and functional diversification, as well as an income profile including a mix of rated tenants and well-established SMEs. The portfolio has pockets of concentration in Birmingham, Edinburgh, and Greater London and the south east, and includes urban industrial and "mid-box" logistics estates, which Fitch considers the strongest elements. There are locally dominant but secondary retail and secondary or tertiary quality office properties, of typically older construction, with pockets of vacancy, and located in areas with weaker demand, as reflected in Fitch's scoring. Fitch has also applied depreciation assumptions above guidance for certain office and logistics assets, with assumptions within a range of 15%-35% to account for information from the valuation. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade A lower estimated rental value (ERV) could lead to negative rating action. The change in model output that would apply with a 10pp increase in rental value decline assumptions would imply the following ratings: 'A+sf' / 'Asf' / 'BBBsf' / 'BB+sf' / 'BBsf' Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Achieving significant rent increases following lease expiries could lead to positive rating action. The change in model output that would apply with a 1pp reduction to cap rate assumptions would imply the following ratings: 'AAAsf' / 'AAAsf' / 'A+sf' / 'Asf' / 'BBB+sf' KEY PROPERTY ASSUMPTIONS (all weighted by net ERV) Summarised below are the weighted average rental value decline, structural vacancy and cap rate assumptions applied in its stable interest rate model-implied rating (MIR) analysis. The ratings are up to three notches above the MIR to account for drivers that have a significant likelihood of being reversed in the near term. This reflects a structural increase in demand for industrial property as a result of growing e-commerce as well as the credit enhancing role of the borrower's financial covenants. Weighted average (WA) depreciation: 16.2% Fitch Net ERV: GBP28.4 million 'BBsf' WA cap rate: 6.2% 'BBsf' WA structural vacancy: 23.8% 'BBsf' WA rental value decline: 17.5% 'BBBsf' WA cap rate: 6.8% 'BBBsf' WA structural vacancy: 26.8% 'BBBsf' WA rental value decline: 20.6% 'Asf' WA cap rate: 7.6% 'Asf' WA structural vacancy: 29.8% 'Asf' WA rental value decline: 23.8% 'AAsf' WA cap rate: 8.0% 'AAsf' WA structural vacancy: 33.7% 'AAsf' WA rental value decline: 27.1% 'AAAsf' WA cap rate: 8.4% 'AAAsf' WA structural vacancy: 38.1% 'AAAsf' WA rental value decline: 30.5% USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Taurus 2025-4 UK Fitch reviewed the results of a third party assessment conducted on the asset portfolio information, and concluded that there were no findings that affected the rating analysis. Overall, and together with any assumptions referred to above, 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. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. WESSEX WELDING: Leonard Curtis Named as Joint Administrators ------------------------------------------------------------ Wessex Welding and Fabrications Ltd was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-004577, and Nicola Elaine Layland and Michael Robert Fortune of Leonard Curtis, were appointed as joint administrators on July 4, 2025. Wessex Welding specialized in architectural metalwork fabrication. Its registered office is at 1580 Parkway, Solent Business Park, Whiteley, Fareham, Hampshire, PO15 7AG. Its principal trading address is at Unit 22, Romsey Industrial Estate, Greatbridge Road, Romsey, Hampshire, SO51 0HR. The joint administrators can be reached at: Nicola Elaine Layland Michael Robert Fortune Leonard Curtis 1580 Parkway Solent Business Park Whiteley Fareham, Hampshire PO15 7AG Further details contact: The Joint Administrators E-mail: creditors.south@leonardcurtis.co.uk Alternative contact: David Tovey XL JOINERY: S&W Partners Named as Joint Administrators ------------------------------------------------------ XL Joinery Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-004192, and Mark Supperstone and Chris Farrington of S&W Partners LLP, were appointed as joint administrators on July 2, 2025. XL Joinery Limited is a manufacturer of other builders' carpentry and joinery; and a wholesaler of wood, construction materials and sanitary equipment. Its registered office and principal office is at Holden Ing Way, Birstall, Batley, West Yorkshire, WF17 9AD. The joint administrators can be reached at: Mark Supperstone Chris Farrington S&W Partners LLP 45 Gresham Street London, EC2V 7BG Contact information: Joint Administrators Tel: 020 7131 4000 Alternative contact name: Shanice Cavalier Email: XLJoineryLimited-InAdministration@swgroup.com ********* 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 2025. 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. 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