News Column

Fitch Affirms SLM 2008-9 and SLM 2011-3

August 22, 2014

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings affirms the SLM Student Loan Trust 2008-9 senior and subordinate notes at 'AAAsf'. Fitch also affirms the SLM Student Loan Trust 2011-3 senior notes at 'AAAsf' and subordinate notes at 'AAsf'. The Rating Outlook for all of the classes remains Stable.

KEY RATING DRIVERS

High Collateral Quality: Both SLM 2008-9 and SLM 2011-3 collateral consists of 100% Federal Family Education Loan Program (FFELP) loans. The credit quality of the trusts collateral is high, in Fitch's opinion, based on the guarantees provided by the transaction's eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch currently rates the U.S. 'AAA' with Outlook Stable.

Sufficient Credit Enhancement (CE): The notes for both trusts benefit from overcollateralization (the excess of trust's asset balance over bond balance) and excess spread. As of June 2014, senior and total parity is 110.33% and 104.17% for SLM 2008-9. Senior and total parity is 109.89% and 105.82% respectively for SLM 2011-3. Both trusts are releasing cash as they have maintained their specified cash release levels.

Adequate Liquidity Support: Liquidity support is provided by a Reserve Fund sized at the greater of 0.25% of the pool balance and $4,175,980 for SLM Student Loan Trust 2008-9; and for SLM Student Loan Trust 2011-3, the greater of 0.25% of the pool balance and $1,197,171.

Acceptable Servicing Capabilities: Navient Solutions, Inc. (formerly known as Sallie Mae, Inc.), as servicer, will be responsible for servicing the portfolios, with Xerox-ES as subservicer for SLM 2011-3. Fitch has reviewed the servicing operations of both Navient Solutions and Xerox-ES and believes them to be an acceptable servicer of FFELP student loans.

RATING SENSITIVITIES

Since the FFELP student loan ABS relies 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 affirmed the following ratings:

SLM Student Loan Trust 2008-9

--Class A at 'AAAsf'; Outlook Stable

--Class B at 'AAAsf'; Outlook Stable.

SLM Student Loan Trust 2011-3

--Class A at 'AAAsf'; Outlook Stable;

--Class B at 'AAsf'; Outlook Stable.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (May 20, 2014);

--'Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria' (June 23, 2014).

--'SLM Student Loan Trust 2011-3 - Appendix' (Nov. 9, 2011).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708795

SLM Student Loan Trust 2011-3 - Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=652889

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=856194

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.



Fitch Ratings

Primary Analyst

Jared Smith

Analyst

+1-212-908-0371

Fitch Ratings, Inc.

33 Whitehall Street

New York, NY 10004

or

Committee Chairperson

Tracy Wan

Senior Director

+1-212-908-9171

or

Media Relations:

Sandro Scenga, +1-212-908-0278 (New York)

sandro.scenga@fitchratings.com


Source: Fitch Ratings


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