OREANDA-NEWS. Fitch Ratings has affirmed the senior class series 2010A-1 notes issued by Federated Student Finance Corporation at 'AAAsf'. The Rating Outlook remains Stable.

KEY RATING DRIVERS

Adequate Collateral Quality: The trust collateral consists of 100% FFELP student loans. In Fitch's opinion, the credit quality of the trust collateral is high based on the guarantees provided by the transaction's eligible guarantors and the reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest for the FFELP loans. Fitch currently rates the U.S. 'AAA' with a Stable Outlook.

Sufficient Credit Enhancement (CE): CE is provided by overcollateralization (OC), or the excess of the trust's asset balance over the note principal balance and excess spread. Fitch only rates the senior notes issued by the Federated Student Finance Corporation - Amended and Restated 2006 Indenture of Trust (2003). The senior parity ratio is 110.58% as of Nov. 30, 2015 collection period.

Adequate Liquidity Support: Liquidity is provided by a reserve account, currently sized at $871,720, with a floor of $500,000.

Satisfactory Servicing Capabilities: Day-to-day servicing is provided by the AES, Sallie Mae Servicing Inc., and Nelnet, which Fitch deems to have satisfactory servicing operations at this time.

On Nov. 18, 2015, Fitch released its exposure draft which delineates revisions it plans to make to the 'Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria', dated June 23, 2014. Fitch has reviewed this transaction under both the existing and proposed criteria.

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, basis risk, and loan extension risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults, basis shock beyond Fitch's published stresses, lower than expected payment speed, and other factors could result in future downgrades. Likewise, a build-up of CE driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

DUE DILIGENCE USAGE
No third-party due diligence was provided or reviewed in relation to this rating action.

Fitch has affirmed the following:

Federated Student Finance Corporation:

--Series 2010A-1 notes at 'AAAsf'; Outlook Stable.