SLC's 2006-A trust collateral consists of
The trust possesses third party insurance policies which are deemed to provide limited credit enhancement for the notes.
Credit Enhancement (CE)
CE is provided by overcollateralization (OC); the excess of the trust's asset balance over the bond balance) and excess spread. Although the total parity ratio (total assets over total liabilities) has been increasing and is currently 101.42% as of
The SLC 2006-A trust's credit enhancement levels are sufficient to maintain the current ratings on the notes and revise the outlook to Stable from Negative on the senior class A notes and subordinate class B notes. The junior subordinate class C notes Outlook was maintained at Negative due to continual deterioration in the collateral performance and limited hard OC protection given the cash release.
Liquidity support will be provided by a debt service reserve fund which is equal to the greater of 0.25% of the original pool balance and 1.00% of the pool balance of the last day of related collection period.
As Fitch's base case default proxy is derived primarily from historical collateral performance, actual performance may differ from the expected performance, resulting in higher loss levels than the base case. This will result in a decline in CE and remaining loss coverage levels available to the notes and may make certain note ratings susceptible to potential negative rating actions, depending on the extent of the decline in coverage.
Fitch affirms and revises the Outlook for the following notes:
--Senior Class A-4 at 'AAAsf'; Outlook to Stable from Negative;
--Senior Class A-5 at 'AAAsf'; Outlook to Stable from Negative;
--Subordinate Class B at 'AAsf'; Outlook to Stable from Negative;
--Junior Subordinate Class C at 'Asf'; Outlook Negative maintained.
Additional information is available at 'www.fitchratings.com'.
--'U.S. Private Student Loan ABS Criteria' (
--'Global Structured Finance Rating Criteria' (
U.S. Private Student Loan ABS Criteria
Global Structured Finance Rating Criteria
Jeffrey Prackup, +1 212-908-0839
Harry Kohl, +1 212-908-0837
Tracy Wan, +1 212-908-0676
Source: Fitch Ratings
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