|[March 01, 2013]
Fitch to Rate Rhode Island Student Loan Auth. 2013 Senior Series A; Presale Issued
NEW YORK --(Business Wire)--
Fitch Ratings expects to rate Rhode Island Student Loan Auth. 2013
Senior Series A (2013A) student revenue bonds as follows:
--$2,000,000 2013A (Serial 2013) 'Asf(EXP)'; Outlook Stable;
--$3,000,000 2013A (Serial 2014) 'Asf(EXP)'; Outlook Stable;
--$3,000,000 2013A (Serial 2015) 'Asf(EXP)'; Outlook Stable;
--$3,500,000 2013A (Serial 2016) 'Asf(EXP)'; Outlook Stable;
--$3,500,000 2013A (Serial 2017) 'Asf(EXP)'; Outlook Stable;
--$3,300,000 2013A (Serial 2018) 'Asf(EXP)'; Outlook Stable;
--$5,850,000 2013A (Serial 2019) 'Asf(EXP)'; Outlook Stable;
--$5,850,000 2013A (Serial 2020) 'Asf(EXP)'; Outlook Stable;
--$5,900,000 2013A (Serial 2021) 'Asf(EXP)'; Outlook Stable;
--$5,500,000 2013A (Serial 2022) 'Asf(EXP)'; Outlook Stable;
--$5,500,000 2013A (Serial 2023) 'Asf(EXP)'; Outlook Stable;
--$5,300,000 2013A (Serial 2024) 'Asf(EXP)'; Outlook Stable;
--$5,125,000 2013A (Serial 2025) 'Asf(EXP)'; Outlook Stable;
--$3,900,000 2013A (Serial 2026) 'Asf(EXP)'; Outlook Stable.
--$3,400,000 2013A (Serial 2027) 'Asf(EXP)'; Outlook Stable.
--$2,900,000 2013A (Serial 2028) 'Asf(EXP)'; Outlook Stable.
Adequate Collateral Quality: The master trust will be collateralized by
existing fixed-rate private student loans originated with proceeds from
earlier bond issuances, loans transferred from the 2004 trust, and new
fixed-rate private student loans to be originated from deal closing to
June 1, 2014. All loans have been credit tested, and have been or will
be originated under the Rhode Island Family Education Loan (RIFEL)
program, as described in Appendix A. Portfolio and securitization
performance in terms of defaults and recoveries has been consistent with
Sufficient Credit Enhancement (CE): Transaction cash flows were
satisfactory under all stressed scenarios at Fitch's 'A' rating
category. CE is provided by overcollateralization (OC; the excess of
trust's asset balance over bond balance) and excess spread. The parity
ratio (total assets to total liabilities) is expected to be 110.51% at
closing. Liquidity support will be provided by a capitalized interes
fund and a debt service reserve fund.
Satisfactory Servicing Capabilities: RISLA will service all of the loans
in the master trust. Fitch has reviewed the servicing operations of
RISLA and views it to be an acceptable servicer.
As Fitch's base case default proxy is derived primarily from historical
collateral performance, actual performance may differ from the expected
performance, resulting in higher loss levels than the base case. This
will result in a decline in CE and remaining loss coverage levels
available to the notes and may make certain note ratings susceptible to
potential negative rating actions, depending on the extent of the
decline in coverage.
Fitch evaluated the sensitivity of the ratings assigned to RISLA 2013-A
to increased defaults, reduced recoveries and excess spread over the
life of the transaction. Fitch's analysis found that the transaction
displays some sensitivity to the above factors, showing a potential
downgrade to 'BB' and 'B'. For further discussion of our sensitivity
analysis and Fitch's stress analysis please see the presale titled
'Rhode Island Student Loan Authority 2013 Senior Series A', dated March.
Additional information is available at 'www.fitchratings.com'.
The ratings above were solicited by, or on behalf of, the issuer, and
therefore, Fitch has been compensated for the provision of the ratings.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria', June 6, 2012;
--'U.S. Private Student Loan ABS (News - Alert) Criteria', Jan. 29, 2013.
Applicable Criteria and Related Research Rhode Island Student Loan
Authority 2013 Senior Series A (US ABS)
Global Structured Finance Rating Criteria
U.S. Private Student Loan ABS Criteria
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