S&P says J.G. Wentworth may need capital; cuts credit ratings
by Joseph N. DiStefano, Posted: November 28, 2008
Standard & Poor's cut counterparty and senior-secured bank loan ratings on J.G. Wentworth Inc., the Bryn Mawr "structured settlement" firm that buys insurance payouts, to 'CCC+' from 'B-', and warned it could cut again. "Wentworth's financial position could deteriorate further unless it receives additional capital to meet margin calls, fund structured settlement/annuity purchases, and pay fixed obligations," due to "severe dislocation of the credit markets" that have "rendered unprofitable" some financing transactions, said S&P analyst Rian M. Pressman in a statement.
"Wentworth received an additional margin call of $16.9 million on Oct. 22, 2008, the payment of which was waived until Nov. 21, 2008. The payment has not yet been made," S&P added. Wentworth makes most of its money by selling asset-backed securities. Because such asset-backed transactions are tough to make in the current market, Wentworth has been reporting losses, S&P said. Wentworth is owned by New York investment firm JLL Partners.
Posted: November 28, 2008 - 2:49 PM
Joseph N. DiStefano
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