GWG Holdings, Inc. (NASDAQ:GWGH) Q1 2019 Earnings Conference Call - Final Transcript

Aug 13, 2019 • 04:30 pm ET

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GWG Holdings, Inc. (NASDAQ:GWGH) Q1 2019 Earnings Conference Call - Final Transcript

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Q & A
Operator
Dan Callahan

Thanks, Brad. We have questions that we've gotten really since the last time we had our last earnings call and we wanted to highlight those. If you have a question, you can submit them and we will get you an answer or you can send it to invest at [Phonetic] gwgh.com. But here's some of the questions that we've been getting. Will GWG continue buying life insurance policies?

Executive
Murray Holland

Well, Dan, as I mentioned in my remarks and we saw in the first quarter, we've made a strategic decision to reduce capital allocated to the secondary market for life insurance and begin which we did in Q2 increasing the capital allocated towards a broader range of diversified alternative assets and funds for which BEN is working to access and provide liquidity. So I think that trend will continue.

Operator
Dan Callahan

Another question. Are there going to be changes in L Bond terms and rates?

Executive
Murray Holland

Well, this is a question we get fairly frequently. And at this point in time, we don't have any plans to make any changes to the terms or the rates on each of those terms.

Operator
Dan Callahan

Given the BEN transaction, has there been any changes to the assets that back L Bond?

Executive
Murray Holland

As in the past, with the exception of the assets pledged to our senior credit facility provider. All of the assets of the holding company of GWGH security L Bonds. Now as of the end of December 2018 when we close the second BEN transaction those assets now include a commercial loan to Beneficient as well as an equity method, investment in Beneficient. Now, when we did that transaction, we also issued L Bonds in conjunction with that. So the pool of assets set back the L Bonds now includes life insurance, not pledged to senior credit facility cash as well as then our investments in Beneficient.

Operator
Dan Callahan

The Insurtech Holdings division, the new division. So what's happening with that and what's the relationship with GWGH?

Executive
Murray Holland

Well, in our Insurtech Tech business is a subsidiary -- wholly-owned subsidiary of GWG. And Jon Sabes, who was our CEO, is running the Insurtech Tech business. They are doing what they have always been doing. And what we've talked to you guys about several times is trying to commercialize epigenetic technology for the life insurance industry for the benefit of the shareholders, and they're going to continue to do that, and we've made a commitment to fund the insurer tech business up to $20 million over the next couple of years with our eventual hope and intention would be to spin them off as a separate company when they've succeeded with their commercialization efforts.

Operator
Dan Callahan

With the BEN transaction and everything that's been going on. What do you see for the GWGH common stock?

Executive
Murray Holland

Well, that's always a tough one to answer. And you won't be surprised that we believe the stock will be positively affected by our expanded relationship with BEN. We think that leads to better access to capital markets, greater institutional