KEY RATING DRIVERS
High Collateral Quality:
The collateral consists of 100% of Federal Family Education Loan Program (FFELP) loans. The credit quality of the trust collateral is high and based on the guarantees provided by the transaction's eligible guarantors and reinsurance provided by the
Fitch affirmed and removed from Rating Watch Negative the 'AAAsf' rated tranches of U.S. FFELP student loan ABS to reflect the revision of the U.S. sovereign rating on
Sufficient Credit Enhancement:
While both the senior and subordinate notes will benefit from overcollateralization (OC; the excess of trust's asset balance over bond balance) and excess spread, the senior notes also benefit from subordination provided by the class B note. As of
Adequate Liquidity Support:
Liquidity support is provided by a
Acceptable Servicing Capabilities:
Since FFELP student loan ABS rely on the U.S. government to reimburse defaults, 'AAAsf' FFELP ABS ratings will likely move in tandem with the 'AAA' U.S. sovereign rating. Aside from the U.S. sovereign rating, defaults and basis risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults and basis shock beyond Fitch's published stresses could result in future downgrades. Likewise, a buildup of credit enhancement driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.
Fitch has taken the following rating actions:
--Class A notes affirmed at 'AAAsf'; Outlook Stable.
--Class B notes upgraded to 'AAsf' from 'Asf'; Outlook Stable.
A comparison of the transaction's Representations, Warranties, and Enforcement Mechanisms (RW&Es) to those of typical RW&Es for student loans is available by accessing the reports and links below:
Additional information is available at 'www.fitchratings.com'.
--'Global Structured Finance Rating Criteria' (
--'Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria' (
--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions -- Amended' (
Global Structured Finance Rating Criteria
Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria
Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions
Source: Fitch Ratings
Most Popular Stories
- Criminal Investigation Opened Into James Foley's Death
- Swiss Suicide Tourism Doubled Since 2009
- Florida's Largest Insurer Says 'Bailout' Attacks Unfair
- Wealth Gap Widened in Past Decade: Census
- Gap Reports Higher Profits, India Plans
- International Revulsion Grows Over James Foley Death
- James Foley Beheading Sparks Anger, Little Action
- Beyonce, Jay-Z Cuba Trip Was Legal After All
- Chinese Stock Funds Are a Late-summer Bloomer
- Sears Holdings Loses $573 Million