OREANDA-NEWS. Fitch Ratings affirms the senior and subordinate notes at 'AAAsf' and 'AAsf' respectively issued by EFS Volunteer No. 3 LLC, Series 2012-1. The Rating Outlook remains Stable on all of the notes.

KEY RATING DRIVERS

High Collateral Quality: The trust collateral comprises Federal Family Education Loan Program (FFELP) loans with guaranties provided by eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch's current U.S. sovereign rating is 'AAA' with a Stable Outlook.

Sufficient Credit Enhancement: Credit enhancement (CE) is provided by overcollateralization (OC) excess spread, and for the class A notes, subordination provided by the class B notes. As of March 2015, senior and total reported parities are 107.27% and 101.75% respectively. The trust is in turbo, so no excess cash will be released until the notes are paid in full.

Adequate Liquidity Support: Liquidity support is provided by a reserve account. The reserve is sized equal to the greater of 0.25% of the pool balance, and \$1,046,206. Additionally, there is a capitalized interest account currently sized at \$4 million, scheduled to release on June 25, 2015.

Acceptable Servicing Capabilities: PHEAA is responsible for the day to day servicing of the trust. Fitch believes PHEAA to be 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 CE driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

Initial Key Rating Drivers and Rating Sensitivities are further described in the new issue report published on Aug. 6, 2012.


Fitch has affirmed the following ratings:

EFS Volunteer No. 3 LLC, Series 2012-1:
--Class A-1 at 'AAAsf'; Outlook Stable;
--Class A-2 at 'AAAsf'; Outlook Stable;
--Class A-3 at 'AAAsf'; Outlook Stable;
--Class B at 'AAsf'; Outlook Stable.