WIFI stopped working when updating 16.10 -> 17.04

Network manager detects 'Bus 001 Device 004: ID 148f:5370 Ralink Technology, Corp. RT5370 Wireless Adapter'. It detects WIFI network, but fails to connect. I booted with older kernel vmlinuz-4.8.0-46-generic: same result. I installed ubuntu 16.10 to same computer and WIFI does work. Password is OK.

Authentication seems to fail in Ubuntu 17.04:
Apr 18 17:13:01 k10 NetworkManager[727]: <info>
[1492524781.2784] policy: auto-activating connection 'ZyXELbb3a'
[1492524781.2798] device (wlxc83a35cde1eb): Activation: starting connection 'ZyXELbb3a' (5362ba4d-c40e-40a3-8e17-4e3deaab48ae)
[1492524781.2801] device (wlxc83a35cde1eb): state change: disconnected -> prepare (reason 'none') [30 40 0]
[1492524781.6699] device (wlxc83a35cde1eb): set-hw-addr: set-cloned MAC address to C8:3A:35:CD:E1:EB (permanent)
[1492524781.9391] device (wlxc83a35cde1eb): state change: prepare -> config (reason 'none') [40 50 0]
[1492524781.9394] device (wlxc83a35cde1eb): Activation: (wifi) access point 'ZyXELbb3a' has security, but secrets are required.
[1492524781.9395] device (wlxc83a35cde1eb): state change: config -> need-auth (reason 'none') [50 60 0]
[1492524781.9748] device (wlxc83a35cde1eb): state change: need-auth -> prepare (reason 'none') [60 40 0]
[1492524781.9782] device (wlxc83a35cde1eb): state change: prepare -> config (reason 'none') [40 50 0]
[1492524781.9792] device (wlxc83a35cde1eb): Activation: (wifi) connection 'ZyXELbb3a' has security, and secrets exist. No new secrets needed.
[1492524781.9796] Config: added 'ssid' value 'ZyXELbb3a'
[1492524781.9800] Config: added 'scan_ssid' value '1'
[1492524781.9803] Config: added 'key_mgmt' value 'WPA-PSK'
[1492524781.9806] Config: added 'auth_alg' value 'OPEN'
[1492524781.9808] Config: added 'psk' value '<omitted>'
[1492524781.9821] sup-iface[0x55d34390d2d0,wlxc83a35cde1eb]: config: set interface ap_scan to 1
[1492524782.0010] device (wlxc83a35cde1eb): supplicant interface state: inactive -> scanning
[1492524783.3941] device (wlxc83a35cde1eb): supplicant interface state: scanning -> authenticating
[1492524783.5787] device (wlxc83a35cde1eb): supplicant interface state: authenticating -> disconnected
[1492524793.5868] device (wlxc83a35cde1eb): supplicant interface state: disconnected -> scanning
[1492524794.9891] device (wlxc83a35cde1eb): supplicant interface state: scanning -> authenticating
[1492524795.1145] device (wlxc83a35cde1eb): supplicant interface state: authenticating -> disconnected

Ubuntu 16.10 is same to authentication:
Apr 18 13:46:10 k15 NetworkManager[714]: <info>
[1492512370.3874] policy: auto-activating connection 'ZyXELbb3a'
[1492512370.3884] device (wlxc83a35cde1eb): Activation: starting connection 'ZyXELbb3a' (fd199068-2375-4268-bb74-d60484d1fadb)
[1492512370.3886] device (wlxc83a35cde1eb): state change: disconnected -> prepare (reason 'none') [30 40 0]
[1492512370.3887] manager: NetworkManager state is now CONNECTING
[1492512370.3895] device (wlxc83a35cde1eb): state change: prepare -> config (reason 'none') [40 50 0]
[1492512370.3897] device (wlxc83a35cde1eb): Activation: (wifi) access point 'ZyXELbb3a' has security, but secrets are required.
[1492512370.3898] device (wlxc83a35cde1eb): state change: config -> need-auth (reason 'none') [50 60 0]
[1492512370.3936] device (wlxc83a35cde1eb): state change: need-auth -> prepare (reason 'none') [60 40 0]
[1492512370.3940] device (wlxc83a35cde1eb): state change: prepare -> config (reason 'none') [40 50 0]
[1492512370.3943] device (wlxc83a35cde1eb): Activation: (wifi) connection 'ZyXELbb3a' has security, and secrets exist. No new secrets needed.
[1492512370.3943] Config: added 'ssid' value 'ZyXELbb3a'
[1492512370.3944] Config: added 'scan_ssid' value '1'
[1492512370.3944] Config: added 'key_mgmt' value 'WPA-PSK'
[1492512370.3944] Config: added 'auth_alg' value 'OPEN'
[1492512370.3944] Config: added 'psk' value '<omitted>'
[1492512370.3949] sup-iface[0x55da7c3f2210,wlxc83a35cde1eb]: config: set interface ap_scan to 1
[1492512371.8005] device (wlxc83a35cde1eb): supplicant interface state: inactive -> authenticating
[1492512371.8071] device (wlxc83a35cde1eb): supplicant interface state: authenticating -> associating
[1492512371.8216] device (wlxc83a35cde1eb): supplicant interface state: associating -> 4-way handshake
[1492512371.8482] device (wlxc83a35cde1eb): supplicant interface state: 4-way handshake -> completed
[1492512371.8482] device (wlxc83a35cde1eb): Activation: (wifi) Stage 2 of 5 (Device Configure) successful. Connected to wireless network 'ZyXELbb3a'.
[1492512371.8483] device (wlxc83a35cde1eb): state change: config -> ip-config (reason 'none') [50 70 0]
[1492512371.8623] dhcp4 (wlxc83a35cde1eb): activation: beginning transaction (timeout in 45 seconds)
Apr 18 13:46:11 k15 NetworkManager[714]: <info> [1492512371.9292] dhcp4 (wlxc83a35cde1eb): dhclient started with pid 1027

ProblemType: Bug
DistroRelease: Ubuntu 17.04
Package: network-manager 1.4.4-1ubuntu3
ProcVersionSignature: Ubuntu 4.10.0-19.21-generic 4.10.8
Uname: Linux 4.10.0-19-generic x86_64
ApportVersion: 2.20.4-0ubuntu4
Architecture: amd64
CurrentDesktop: Unity:Unity7
Date: Tue Apr 18 16:56:33 2017
IfupdownConfig:
 # interfaces(5) file used by ifup(8) and ifdown(8)
 auto lo
 iface lo inet loopback
InstallationDate: Installed on 2017-01-05 (103 days ago)
InstallationMedia: Ubuntu 16.10 "Yakkety Yak" - Release amd64 (20161012.2)
IpRoute:
 default via 192.168.3.1 dev eno1 proto static metric 100
 169.254.0.0/16 dev eno1 scope link metric 1000
 192.168.3.0/24 dev eno1 proto kernel scope link src 192.168.3.10 metric 100
NetworkManager.conf:
 [main]
 plugins=ifupdown,keyfile

 [ifupdown]
 managed=false
NetworkManager.state:
 [main]
 NetworkingEnabled=true
 WirelessEnabled=true
 WWANEnabled=true
RfKill:
 0: phy0: Wireless LAN
  Soft blocked: no
  Hard blocked: no
SourcePackage: network-manager
UpgradeStatus: Upgraded to zesty on 2017-04-16 (1 days ago)
nmcli-con:
 NAME UUID TYPE TIMESTAMP TIMESTAMP-REAL AUTOCONNECT AUTOCONNECT-PRIORITY READONLY DBUS-PATH ACTIVE DEVICE STATE ACTIVE-PATH
 Kiinteä yhteys 1 30d11d14-146e-3091-801b-2fc21d102ad2 802-3-ethernet 1492523796 ti 18. huhtikuuta 2017 16.56.36 yes 4294966297 no /org/freedesktop/NetworkManager/Settings/1 yes eno1 activated /org/freedesktop/NetworkManager/ActiveConnection/4
 ZyXELbb3a 5362ba4d-c40e-40a3-8e17-4e3deaab48ae 802-11-wireless 1492369587 su 16. huhtikuuta 2017 22.06.27 yes 0 no /org/freedesktop/NetworkManager/Settings/0 no -- -- --
nmcli-dev:
 DEVICE TYPE STATE DBUS-PATH CONNECTION CON-UUID CON-PATH
 eno1 ethernet connected /org/freedesktop/NetworkManager/Devices/1 Kiinteä yhteys 1 30d11d14-146e-3091-801b-2fc21d102ad2 /org/freedesktop/NetworkManager/ActiveConnection/4
 wlxc83a35cde1eb wifi disconnected /org/freedesktop/NetworkManager/Devices/2 -- -- --
 lo loopback unmanaged /org/freedesktop/NetworkManager/Devices/0 -- -- --
nmcli-nm:
 RUNNING VERSION STATE STARTUP CONNECTIVITY NETWORKING WIFI-HW WIFI WWAN-HW WWAN
 running 1.4.4 connected started full enabled enabled enabled enabled enabled