Fitch Affirms North Texas Higher Education Authority, Inc. Series 2012-1; Outlook Stable
KEY RATING DRIVERS
High Collateral Quality: The trust collateral consists of 100% (91.87% Non-Rehab; 8.13% Rehab) 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 currently rates the U.S. 'AAA' with a Stable Outlook.
Sufficient Credit Enhancement: CE is provided by overcollateralization (OC; the excess of trust's asset balance over bond balance) and excess spread. As of March 2015, total parity is 107.29% (6.8% CE). The trust is a turbo structure; therefore, no cash is released until the note is 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 \$ 694,800.
Acceptable Servicing Capabilities: Higher Education Servicing Corporation (HESC) is the master servicer and also provides day-to-day servicing for 35% of the loans. Edfinancial Services, LLC (Edfinancial) services 59% of the loans, and Nelnet Servicing, LLC (Nelnet) services the remaining 7%. Pennsylvania Higher Education Assistance Agency (PHEAA) is the backup servicer for the loans serviced by HESC and Edfinancial. All servicers have demonstrated adequate servicing capabilities.
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 CE driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.
DUE DILIGENCE USAGE
Fitch was not provided due diligence information from any third parties relating to the North Texas Higher Education Authority, Inc. Series 2012-1 Trust.
Комментарии