Moody’s rates JGWPT Holdings securitisation of structured settlements
Global rating agency Moody’s has assigned provisional ratings to Notes issued by JGWPT XXVII LLC (the Issuer), an indirect wholly owned subsidiary of J.G. Wentworth Originations LLC (the Sponsor), collateralized by a pool of structured settlement payments and assignable annuity streams.
Global rating agency Moody’s ratings on the Notes reflect its assessment of the quality of the court-ordered structured settlement payment streams and annuity receivables, the creditworthiness of the obligors, the servicing arrangement, and the structural and legal features. This securitization transaction is very similar to the Sponsor’s previous transactions, except that the Prefunding Account is larger than in the past and the Class A subordination is slightly smaller.
The main driver of credit risk in this transaction is the obligor base. As in the Sponsor’s previous securitizations, the pool of oblig- ors are primarily highly rated life insurance companies, of which more than 90% (based on the present value of the securitized receivables) have an insurance financial strength rating of A3 or higher.
The Issuer’s assets include court-ordered structured settlement payments (around 95.6% of the present value of the receivables), annuity receivables (around 4.4% of the present value of the receivables), a Reserve Account with around $1,233,824, a Capitalized Interest Account with approximately $784,548, and a Prefunding Account with approximately $76,702,718. The Prefunding Account constitutes approximately 40% of the balance of the Notes compared with approximately 35% in JGWPT XXI LLC, Series 2012-2. Amounts on deposit in the Prefunding Account will be used to acquire additional receivables within a Prefunding Period of ninety days after closing. The addition of new receivables will be subject to eligibility criteria and to a Rating Agency Condition from Moody’s stating that it will not downgrade.