OREANDA-NEWS. Fitch Ratings affirms the senior and subordinate class notes issued by the State Board of Regents of the State of Utah Student Loan Backed Notes, Series 2015-1 (Utah 2015-1) as follows:

--2015-1A notes at 'AAAsf'; Outlook Stable;

--2015-1B notes at 'Asf'; Outlook Stable.

KEY RATING DRIVERS

Collateral Quality: The trust collateral consists of 100% of FFELP loans. The credit quality of the trust 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 a Stable Outlook.

Credit Enhancement: Credit enhancement (CE) is provided by overcollateralization (OC; the excess of trust's asset balance over bond balance), excess spread, and for the senior notes, subordination provided by the subordinate notes. As of March 2016, senior and subordinate parities are 105.9% (5.56% CE) and 102.60% (2.53% CE), respectively. The trust is in turbo, and no funds can be released until the notes have been paid in full.

Liquidity Support: Liquidity support is provided by a reserve account sized to equal the greater of 0.25% of the note balance and 0.15% of the original principal amount of the notes, $623,250. As of March 2016, the reserve account balance is $887,605.

Servicing Capabilities: Day-to-day servicing will be provided by the State Board of Regents of the State of Utah (the Board), and Pennsylvania Higher Education Assistance Agency (PHEAA) will act as backup servicer. Fitch believes the Board and PHEAA provide adequate servicing of FFELP student loans.

In certain LIBOR-down interest rate stress scenarios the basis spread may be compressed, as Fitch would apply a floor to 1-month LIBOR at a negative rate level in accordance with Fitch's 'Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds' (May 2016). Since the updated interest rate stresses are not addressed yet in existing FFELP criteria, this represents a criteria variation. Use of the criteria variation did not have a measurable impact upon the ratings assigned.

Under its 'Counterparty Criteria for Structured Finance and Covered Bonds', dated May 14, 2014, Fitch looks to its own ratings in analysing counterparty risk and assessing a counterparty's creditworthiness. The definition of permitted investments for this deal allows for the possibility of using investments not rated by Fitch, which represents a criteria variation. Since the only available funds to invest in are those held in the Collection Account, and the funds can only be invested for a short duration of three months given the payment frequency of the notes, Fitch does not believe such a variation has a measurable impact upon the ratings assigned.