Riftstone Trust Series 2017-7 BABA Certificates Assigned Rating

Stocks and Financial Services Press Releases Friday February 9, 2018 08:34
NEW YORK--9 Feb--S&P Global Ratings

NEW YORK (S&P Global Ratings) Feb. 8, 2018--S&P Global Ratings today assigned its 'A+p' principal-only rating to Riftstone Trust Series 2017-7 BABA's $20 million Riftstone Trust Series 2017-7 BABA certificates due June 8, 2023. The rating reflects our opinion of the likelihood that the trust will have sufficient assets to pay timely principal when due on the certificates.

These assets include the underlying securities, which comprise either 2.8% notes due June 6, 2023, issued by Alibaba Group Holding Ltd. ('A+'; BABA notes) or U.S. Treasury separate trading of registered interest and principal securities (STRIPS) due May 31, 2023 ('AA+').

The STRIPS could replace the BABA notes at the option of Wells Fargo Bank N.A. (A+/Stable/A-1) upon an optional redemption or an additional termination event described in the option agreement's schedule, which Wells Fargo Bank N.A. entered into with the trust.

Our rating on the certificates depends on the lower of our ratings on the underlying securities and our long-term issuer credit rating on the option agreement counterparty, Wells Fargo Bank N.A. Based on our analysis, we believe the trust's assets support the full and timely payment principal payment on the certificates, except in certain circumstances as described in the Structural Review section below. In addition to principal, the investor is entitled to interest and equity-linked supplemental income.

Our rating does not address the supplemental income or interest payment because, in our opinion, the supplemental income is not credit-based and the interest payment is not measurable due to the underlying BABA notes being subject to partial redemption at the issuer's option.

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