OREANDA-NEWS. Fitch Ratings has affirmed the senior student loan and subordinate bonds issued by College Loan Corporation Trust II at 'AAAsf' and 'Asf' respectively. The Rating Outlook for the senior and subordinate notes is Stable.

KEY RATING DRIVERS

Collateral Quality: The trust collateral consists of 100% Federal Family Education Loan Program (FFELP) student loans. The credit quality of the trust 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. at 'AAA' with a Stable Outlook.

Sufficient Credit Enhancement: Credit enhancement is provided by overcollateralization and excess spread, while the class A notes also benefit from subordination provided by the class B notes. Senior and total parity is at 108.09% and 101.16%, respectively as of Dec. 31, 2014 collection period, however, Fitch only gives credit to 105% and 100.50% parity, respectively, as that is the trust's release level.

Adequate Liquidity Support: Liquidity support for the notes is provided by a reserve account which is currently at \$2.74 million, with a floor of the great of 0.50% of the bond balance and \$2,000,000.

Acceptable Servicing Capabilities: Xerox Education Services, LLC, doing business as ACS Education Services (XES) services 93.61% and Great Lakes services the remaining 6.39% of the portfolio. Fitch believes XES and Great Lakes is an acceptable servicer of FFELP student loans.

RATING SENSITIVITIES

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 affirmed the following ratings:

College Loan Corporation Trust II:

--2007 class 1A-2 at 'AAAsf'; Outlook Stable;
--2007 class 1A-3 at 'AAAsf'; Outlook Stable;
--2007 class 1A-6 at 'AAAsf'; Outlook Stable;
--2007 class 1A-11 at 'AAAsf'; Outlook Stable;
--2007 class 1A-14 at 'AAAsf'; Outlook Stable;
--2007 class 1B-2 at 'Asf'; Outlook Stable;
--2007 class 1B-3 at 'Asf'; Outlook Stable.