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J.G. Wentworth Possible Distressed Debt Exchange

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On June 26, 2017, S&P Global Ratings lowered its issuer credit rating on J.G. Wentworth LLC (JGW) to CCC- from CCC+ and its senior secured debt rating to CCC- from CCC+. “Our rating action today reflects our opinion that a distressed debt exchange transaction, which the company publicly disclosed it was contemplating earlier this year, is likely in the next six months,” said S&P Global Ratings credit analyst Chris Cary. According to S&P Global, the negative outlook reflects the expectation that JGW is likely to negotiate a distressed exchange offer with its debtholders in the next six months. While management has restored the structured settlement business to profitability and the mortgage business is growing at a steady pace, S&P does not think the cash flows from these businesses will be sufficient to repay the current outstanding senior unsecured debt due early in 2019. Read more on distressed companies.