CompuCredit Corp. unit Jefferson Capital sold a $2.9 billion portfolio of charged-off consumer credit card debt to Encore Capital Group, the companies announced. Encore paid $142.8 million for the portfolio, as well as the right to purchase an additional $3.25 billion in face value charged-off credit card receivables from Jefferson over the next five years. Also as part of the transaction, Encore has extended its existing agreement to sell Chapter 13 bankruptcies to Jefferson for an additional two years and agreed to provide Jefferson with a prescribed number of accounts on a monthly basis for its balance transfer program.
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The trust employs a 24-month revolving period. There is an increased risk that collateral quality could deteriorate as the transaction evolves with new collateral.
March 27 - Yahoo Finance Feed
The banking giant has launched an online platform that links small-business owners and entrepreneurs in need of capital to community development financial institutions. The platform was developed in partnership with Community Reinvestment Fund USA.
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Audited financials, proof of fidelity bonds and errors and omissions insurance must be provided on Ginnie Mae Central after May 13.
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Aside from the cash flow stabilization, another credit positive to the deal, TAH Operations is property manager to the portfolio, and has strong processes and controls.
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Four tranches of class A notes make up the capital structure, and they all benefit from 3.00% in total initial hard credit enhancement.
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Seven of the loans, 27.7% of the pool balance, are secured by multiple properties or have a component of cross-collateralization, benefitting from greater cash flow stability.
March 26