by John Darer CLU ChFC MSSC CeFT RSP CLTC
I'll let the headline speak for itself, but more important are the details which shed more light on what has been at the root of the SuttonPark Nightmare.
Morningstar DBRS Maintains Under Review with Negative Implications Designation on SuttonPark Transactions | Morningstar DBRS
Morningstar states that its rating actions are based on the following analytical considerations:
-- The maintaining of the URN designation is primarily due to the ongoing servicing transfer to Vervent and the finalization of the transfer of the lock box accounts to Axos Bank. Morningstar DBRS will continue to monitor the on-going servicing transfer and evaluate the impact on collateral performance and collections available to each transaction to resolve the URN designation. Morningstar DBRS continues to maintain dialogue with the restructuring agent to keep apprised of progress and timing of these operational transfers and collateral performance.
-- There was a steep drop in collections in November for all transactions, primarily attributed to the migration from the former lockbox to the replacement lockbox. This is expected to be a one-off event and collections should stabilize on future payment dates.
-- The generally high credit quality of annuity providers and their improved capitalization positions and risk-management frameworks, which have been enhanced since the global financial crisis of 2008-09.
-- The transactions' capital structure and form and sufficiency of available credit enhancement.
-- The transactions' performance to date with zero or minimal default
What is a Lock Box Banking?
Lockbox Banking: Definition, How It Works, Risks, and Cost
Lock Box Banking is used by many structured settlement annuity issuers as a central point to collect premium when structured settlements are funded. Lock boxes are also used by payment servicing companies to collect the payment from an an annuity issuer when a payment srervicing agreenent is in place to divide the payment between the annuitant and investors in a payment stream (or payment streams) that the annuitant has sold.
Who is Vervent?
Vervent - Providing Solutions At The Speed Of Service
Who is Axos Bank?
I indicated this might be happening in my December 6, 2024 post. See SuttonPark Nightmare Update December 6, 2024 - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews be more
Emphasis on the Underscore
It's a shame that SuttonPark created such needless upheaval for the payees affected by payment servicing agreements under its purview, which was exacerbated by an unprecedented information void, that I've devoted considerable pro bono time attempting to help fill for the benefit of consumers on both sides of the divide.
Meanwhile... SuttonPark Capital Earns F Rating from Better Business Bureau
SuttonPark Capital LLC | BBB Complaints | Better Business Bureau
Last updated January 21, 2025
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