BHG Financial Achieves a Milestone with Its First Consumer-Only ABS Transaction

BHG Financial, a prominent figure in unsecured personal loans and small business lending, announced the closing of its first-ever consumer-only asset-backed securities (ABS) transaction, BHG 2024-1CON, amounting to $273.3 million. This transaction, which successfully closed on March 25, 2024, represents a significant landmark for the company since the start of its securitization program in 2020. BHG Financial has sponsored a total of nine ABS transactions, with this being the first to be entirely collateralized by consumer loans. The company has cumulatively closed $2.9 billion in securitization volume since July 2020.

The ABS notes, particularly the Class A Notes, received a AAA (sf) rating from both Fitch Ratings Inc. and Kroll Bond Rating Agency, LLC. This high rating, alongside the swift oversubscription of the issuance, underscores the strong market demand and investor confidence in BHG Financial's loan quality. Truist Securities, Inc. led the transaction as the sole Structuring Agent and Joint Bookrunner, working alongside other notable entities.

The initiative, which transitioned to an all-consumer loan structure, saw over $1.5 billion in collective orders, illustrating broad market support and investor interest. This response also marked a record number of unique purchasers for any deal in BHG's history, emphasizing the strength of BHG's consumer funding. The transaction's yield stood at 7.041%, benefiting from favorable market conditions and superior deal-related technicals.