DBRS Assigns Provisional Ratings to BXG Receivables Note Trust 2016-A

DBRS, Inc. (DBRS) has today assigned provisional ratings to the following classes of Timeshare Loan-Backed Notes issued by BXG Receivables Note Trust 2016-A:

-- Series 2016-A, Class A rated A (sf)
-- Series 2016-A, Class B rated BBB (sf)

The ratings are based upon a review by DBRS of the following analytical considerations:

(1) Transaction capital structure, proposed ratings and form and sufficiency of available credit enhancement.
-- Credit enhancement is in the form of subordination, overcollateralization, amounts held in the reserve account and excess spread. Credit enhancement levels are sufficient to support the DBRS-projected expected loss assumption under various stress scenarios.

(2) The ability of the transaction to withstand stressed cash flow assumptions and repay investors according to the terms upon which they have invested. For this transaction, the rating addresses the payment of timely interest on a monthly basis and principal by the stated maturity date.

(3) Bluegreen’s long operating history and its capabilities with regard to developing and managing timeshare resorts as well as the origination, underwriting and servicing of Timeshare Loans.
-- DBRS has performed an operational risk review of Bluegreen Corporation and considers the entity to be an acceptable originator and servicer of Timeshare Loans.
-- The Bluegreen senior management team averages approximately 15 years of Company tenure.

(4) The credit quality of the Transaction collateral and the consistent performance of Bluegreen’s Timeshare Loan portfolio.
-- Sufficient availability of historical performance data and a history of consistent performance on the Bluegreen Timeshare Loan portfolio.
-- The statistical collateral pool is seasoned approximately 18 months and contains Bluegreen originations from Q4 2006 through Q1 2016. The average remaining life of the collateral pool is approximately 99 months. The weighted-average FICO score of the pool is 707 (excludes obligors with no FICO, which is equal to approximately 2.5% of the statistical cut-off pool).

(5) The legal structure and presence of legal opinions that address the true sale of the assets to the Issuer, the non-consolidation of each of the depositor and the Issuer with Bluegreen, that the Issuer has a valid first-priority security interest in the assets and the consistency with the DBRS “Legal Criteria for U.S. Structured Finance” methodology.

Notes:
This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodology is Rating U.S. Timeshare Loan Securitizations, which can be found on our website under Methodologies.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.

Please see the attached appendix for additional information regarding sensitivity of assumptions used in the rating process.