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J.G. Wentworth Blog

Bond Sale Successful

Hi everyone. J.G. Wentworth here.

The news about our recent bond sale is all over the news wires, but nonetheless, I thought it appropriate to take a few moments here to discuss it further, and offer up one “big picture” idea.

The facts are we sold $212 million worth of bonds. We created them by taking all the structured settlement payment streams that we bought, pooling them together, and then separating them into individual bonds that investors could buy. The bonds are generally bought by big institutional investors. The good news is more and more of these investors are attracted to our bonds because of their historical track record.

Understanding the creation and sale of bonds is complex subject matter that few people really understand.

What’s more important than the mechanics of the process is the impact it has on consumers. Specifically, creating a link between sellers of structured settlement payments, and the credit markets, where investors actively compete for bonds, has the effect of driving down the discount rates. Net, net, the lower discounts rates are, the more cash consumers get for their payments. And you don’t have to be a Wall Street wizard to understand that’s a very good thing.