Best Egg and Cross River Bolster Funding Strategy with Levered Certificate Program
CRB Securities LLC ("CRBS"), a SEC-registered broker-dealer and FINRA member, and Best Egg, Inc., a leading financial technology company that drives financial confidence, together announce the completed issuance of the first series in Best Egg's new private structured pass-through program, BEAST 2024-A.
Series 2024-A of the Best Egg Asset Structured Pass-Through Trust (BEAST) is backed by Best Egg's signature unsecured loan product, with an aggregate principal balance of approximately $160 million. The deal is sponsored by Best Egg, and CRBS served as the sole Structuring and Placement Agent. Best Egg intends to leverage the BEAST shelf programmatically as a funding mechanism, providing institutional investors access to both senior, credit-enhanced notes, as well as levered residual certificates.
"We're proud to further strengthen our partnership with Cross River as we announce the launch of BEAST," said Adam King, Head of Capital Markets at Best Egg. "It allows for a simple and efficient investment vehicle that attracts a wide group of investors, both new and existing to the program."
Cross River Bank ("Cross River") and Best Egg have a longstanding relationship. Cross River and Best Egg began their collaboration in 2013, with Cross River acting as the fintech's sponsor bank. Ten years later, the companies set up a seasoning facility, allowing Best Egg to leverage Cross River's balance sheet for a fixed period prior to selling whole loans to institutional investors or securitizing through Best Egg's broad syndicate program. Adding CRBS to the fold provides Best Egg with a "closed-loop" funding solution where assets are originated and seasoned by Cross River, and then packaged into securities and placed with institutional investors by CRBS. Cross River provides Best Egg with a risk retention financing solution as well.
"We're thrilled to support the Best Egg team by providing an additional, low-friction layer to their capital strategy," said Ryan Callahan, Head of Structured Products at CRBS. "While still in its early days, there is strong demand from credit investors that are looking for fixed volume with built-in leverage, avoiding the need to set up external financing."
Funds managed by O'Connor Capital Solutions (OCS), a private credit strategy within UBS Asset Management, and Wafra, a New York based, global alternative investment firm, are the first institutional investors to support Best Egg's new private structured pass-through program, purchasing the Residual Certificates related to BEAST 2024-A.
"We are excited to participate in the initial transaction of this program as we continue to be active in consumer finance and asset-backed finance. We think the structure of the program and the consistency of Best Egg's asset's performance creates an opportunity for attractive, risk-adjusted returns in the consumer finance space," said Joshua Mercado, principal at OCS.
"We are pleased to partner with the Best Egg team on their inaugural structured pass-through program," said Paul Steinberger, Head of Special Situations at Wafra. "This new offering creates an efficient structure with attractive risk-reward characteristics that we think will prove compelling for our investors."
About Cross River
Cross River provides technology infrastructure powering the future of financial services. Leveraging its proprietary real-time banking core, Cross River delivers innovative and scalable embedded payments, cards, and lending solutions to millions of consumers and businesses. Cross River is backed by leading investors and serves the world's most essential fintech and technology companies. Leading the industry, Cross River is reshaping global finance and financial inclusion. Member FDIC. Find out more at www.crossriver.com.
About CRB Securities
CRB Securities, LLC ("CRBS") is a wholly owned subsidiary of CRB Group Inc, a bank holding company, and the parent company of Cross River Bank, established in 2008. CRBS is a SEC-registered broker-dealer and FINRA member. CRBS was created to solve the financing needs of clients that are looking to access the capital markets through the issuance of securities. Through CRBS, Cross River clients can diversify their funding strategy in a flexible and operationally efficient manner. For more information on CRBS, please visit https://brokercheck.finra.org/.
About Best Egg
Best Egg is a leading fintech that drives financial confidence, providing flexible solutions to help people with limited savings adapt to their changing needs. Best Egg supports customers through a growing suite of personal loans, flexible rent, and financial health tools. Leveraging real-time customer insights and data engineering, Best Egg gives more people access to the resources they need to be money confident. For more information, visit www.bestegg.com.
About Wafra
Wafra is a global alternative investment manager with approximately $28 billion of assets under management across a range of alternative assets, including real assets, real estate, special situations and strategic partnerships. By providing flexible and accretive capital solutions and focusing on long-term partnerships, Wafra aligns and partners with high quality asset owners, companies, and management teams. Headquartered in New York, Wafra has additional offices in London and Bermuda. For more information, please visit www.wafra.com.
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