OREANDA-NEWS. Fitch Ratings affirms Nelnet Student Loan Trust's 2014-3 senior notes at 'AAAsf' and subordinate notes at 'A+sf'. The Rating Outlook for the senior notes remains Stable, and the Outlook the subordinate notes has been revised to Positive from Stable. The Outlook revision is driven by the trust reaching its target level of credit enhancement, as well as amortization of the bonds.

KEY RATING DRIVERS

High Collateral Quality: The trust collateral is comprised of 100% of Federal Family Education Loan Program (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 rates the U.S. sovereign government at 'AAA' with Outlook Stable.

Sufficient Credit Enhancement: CE is provided by overcollateralization (OC; the excess of trust's asset balance over bond balance) and excess spread, and for the senior notes, subordination of the class B notes. As of February 2015, total parity is 101.01% (1.00% CE) and senior parity is 104.04% (3.88% CE). The trust has been releasing cash given the Specified Overcollateralization Amount equal to the greater of 1.0% of the adjusted pool balance and \$2,000,000 is maintained.

Adequate Liquidity Support: Liquidity support is provided by a reserve account sized at the greater of (i) 0.90% of the outstanding bond balance before May 2019 (steps down to 0.25% of the outstanding bond balance after May 2019) and \$719,800, currently equal to \$5,994,875.49.

Acceptable Servicing Capabilities: Acceptable Servicing Capabilities: Day to day servicing is provided by Nelnet, Pennsylvania Higher Education Assistance Agency (PHEAA) and Great Lakes Educational Loan Services. In Fitch's opinion, all servicers are acceptable servicers 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 Nelnet Student Loan Trust 2014-3 as follows:

--Class A at 'AAAsf'; Outlook Stable;
--Class B at 'A+sf'; Outlook revised to Positive from Stable.