PPLUS Trust Series GSC-2 2025 Annual Report: What Investors Need to Know

Overview and Structure

The PPLUS Trust Series GSC-2, managed by Merrill Lynch Depositor, Inc., has filed its annual report for the fiscal year ended December 31, 2025. The Trust is structured as a pass-through vehicle holding underlying securities issued by The Goldman Sachs Group, Inc. Investors in the Trust hold certificates representing interests in these underlying securities. The Trust’s reporting and compliance are closely tied to the performance and disclosures of the underlying securities issuer and guarantor.

Key Regulatory and Compliance Highlights

• Non-Accelerated Filer Status: The Trust is classified as a non-accelerated filer, and not a well-known seasoned issuer. It is not required to file reports under Section 13 or 15(d) as frequently as larger or more significant entities.
• Filing Compliance: The Trust affirms it has filed all required reports under the Securities Exchange Act of 1934 for the past 12 months and has been subject to these requirements for the past 90 days.
• Internal Controls: The Trust does not file a report or attestation to its management’s assessment of internal controls over financial reporting under Section 404(b) of the Sarbanes-Oxley Act, as it is not required for this entity.
• Shell Company Status: The Trust is not a shell company.

Market Information and Shareholder Structure

• No Public Equity: There are no securities registered under Section 12(g) of the Exchange Act. There is no public market for the Trust certificates, and the Trust has not reported the market value of its equity held by non-affiliates. There are no shares of common stock outstanding, and no equity compensation plans are in effect.
• Not Applicable Sections: Many standard reporting sections such as Market for Registrant’s Common Equity, Executive Compensation, Security Ownership of Certain Beneficial Owners, and Director Independence are listed as “Not Applicable.”

Business Risks and Price-Sensitive Information

The most crucial information for investors relates to the risks associated with the structure and underlying securities:

• Early Redemption or Call Risk: If the underlying securities are redeemed or if call warrants are exercised before maturity, investors may not be able to reinvest the redemption proceeds at a yield comparable to the Trust certificates. This could impact returns and potentially the value of the Trust certificates.
• Performance Dependency: The Trust’s performance is directly linked to the financial condition and creditworthiness of The Goldman Sachs Group, Inc. as both the issuer and guarantor of the underlying securities. Any negative events or undisclosed issues affecting Goldman Sachs could materially impact the Trust’s value and distributions.
• Default and Reporting Risks: If the underlying securities issuer defaults or ceases Exchange Act reporting, the Trust may be forced to sell the underlying securities under potentially adverse market conditions, possibly resulting in investor losses.
• Interest Payment Deferral: The underlying securities permit the issuer to defer interest payments, which increases volatility and could lead to lower market values for the Trust certificates, even in the absence of an actual payment deferral.
• Interest Rate Cap: The Trust certificates pay a floating interest rate, subject to a cap (between 3.00% and 8.00%). If general interest rates rise above the cap, the market value of the Trust certificates may decline.
• Distribution Delays: There was a technical delay in the filing of the Form 8-K report related to the November 17, 2025, distribution. This was due to authorization issues with the EDGAR system, but the Trust asserts that procedures are in place to prevent recurrence.

Legal and Compliance Matters

• Insider Trading Policy: The report includes Bank of America Corporation’s updated Insider Trading Policy (as of January 6, 2025), which outlines strict prohibitions against trading securities while in possession of material nonpublic information (MNPI), and requires pre-clearance of trades for designated insiders. Violations may result in civil, criminal, and disciplinary action, including dismissal.
• Clawback Policy: The Trust also incorporates a policy related to the recovery of erroneously awarded compensation, aligning with SEC clawback rules in the event of an accounting restatement.

Auditor Reports and Servicing Standards

• Independent Accountant Reports: Both PricewaterhouseCoopers LLP and KPMG LLP provided reports confirming compliance with the Trust’s minimum servicing standards.
• Trustee Compliance: The Bank of New York Mellon, as trustee, is responsible for ensuring accuracy in distribution calculations, custodial account management, and timely filing of distribution reports.

What May Move the Share Price

• Any material changes, financial distress, or regulatory disclosures by The Goldman Sachs Group, Inc. could have an immediate impact on the value of the Trust certificates.
• Early redemption, deferral of interest payments, or a forced sale of underlying securities could materially impact investor returns and secondary market pricing for the Trust certificates.
• Changes in regulatory compliance, especially around reporting or internal controls, could be price sensitive if they signal operational or financial weaknesses.

Conclusion

The PPLUS Trust Series GSC-2 remains structurally and operationally stable as of the end of 2025. However, investors must closely monitor developments at The Goldman Sachs Group, Inc., as any adverse events or regulatory actions involving the underlying securities issuer and guarantor could have a direct and material impact on the Trust’s performance, distributions, and certificate values.

There are no new business developments, mergers, acquisitions, or significant legal proceedings disclosed in this annual report that would independently impact the Trust’s structure or operations at this time.

Disclaimer

This article is for informational purposes only and does not constitute investment advice. Investors should review all official filings and consult with qualified financial advisors before making investment decisions. The information provided is based on the PPLUS Trust Series GSC-2 2025 Annual Report and may be subject to change without notice.

View PPLUS Trust Series GSC-2 Historical chart here