Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by BHG Securitization Trust 2021-A (“BHG 2021-A”), an asset-backed securitization collateralized by a pool of small business loans (“Commercial Loans”) and unsecured consumer loans (“Consumer Loans”).
BHG 2021-A will issue three classes of notes totaling approximately $273.9 million. The preliminary ratings reflect initial credit enhancement levels of 22.90% for the Class A Notes, 11.40% for the Class B Notes, and 7.50% for the Class C Notes.
BHG 2021-A represents the second term ABS securitization for the Bankers Healthcare Group, LLC (“BHG” or the “Company”). BHG was founded in 2001 and provides Commercial Loans and Consumer Loans primarily to prime, high income professionals. The Company is led by co-founder, Chairman and Chief Executive Officer Albert Crawford. In 2015 and 2016, Pinnacle Financial Partners, Inc., a holding company headquartered in Tennessee, acquired ownership interests in BHG and, with its subsidiary Pinnacle Bank, currently owns 49% of the Company. With corporate headquarters in Davie, Florida, and financial headquarters in Syracuse, New York, BHG has provided more than $8.0 billion in funding to over 80,000 borrowers since inception.
KBRA applied its General Global Rating Methodology for Asset-Backed Securities, Consumer Loan ABS Global Rating Methodology and Global Structured Finance Counterparty Methodology as part of its analysis of the transaction’s underlying collateral pool and the proposed capital structure. KBRA also conducted an operational review of BHG, as well as a review of the transaction’s legal structure and transaction documents. Operative agreements and legal opinions will be reviewed prior to closing.
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Related Publications
- General Global Rating Methodology for Asset-Backed Securities
- Consumer Loan ABS Global Rating Methodology
- Global Structured Finance Counterparty Methodology
Disclosures
Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.
A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be located here.
Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.
About KBRA
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority pursuant to the Temporary Registration Regime. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.
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