JG Wentworth is marketing $213 million of bonds backed by structured settlement payments, according to a presale report from DBRS.
J.G. Wentworth XXXIV LLC Series 2015-1 is the firm’s 41st term securitization. The bulk of the collateral, or 94.15%, consists of court-ordered structured settlements related to personal injury; another 3.11% is related to annuities and 2.74% to lotteries. It is a mix of new collateral (86.99%) and receivables acquired from a Peachtree Series 2004-A transaction that was recently prepaid (13.01%).
Among credit strengths cited by DBRS is the diversity of highly rated insurance companies making the settlement payments. They have a weighted average credit rating of approximately “A,” with 76.39% of the pool backed by carriers with at least an A (low) rating and 86.74% backed by carriers with at least a BBB rating. In addition, no single provider rated below BBB (low) comprises more than 0.73% of the pool.
The deal is partially prefunded: only 60% of the assets will be purchased at closing; the remaining 40% of proceeds from the deal will be put to work within 90 days of closing. JG Wentworth may use a portion of the prefunding account to purchase additional lottery receivables, potentially boosting the concentration of this type of asset as high as 5.50%.
The securitization trust will issue two classes of notes: DBRS has assigned a preliminary AAA’ rating to $192.28 million of class A notes that benefit from credit support of 15.75% and a preliminary BBB’ rating to $20.86 million of class notes with credit support of 9.25%. Both classes of notes have a final maturity of November 2038.