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Fitch Affirms College Loan Corporation Trust 2005-2; Outlook StableFitch Ratings has affirmed the senior notes at 'AAAsf' and subordinate notes at 'A+sf' issued by College Loan Corporation Trust 2005-2. The Rating Outlook remains Stable for the senior and subordinate notes. KEY RATING DRIVERS High Collateral Quality: The trust collateral is comprised of 100% 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 at least 97% reinsurance of principal and accrued interest provided by the U.S. Department of Education (ED). The current U.S. sovereign rating is at 'AAA' with a Stable Outlook. Sufficient Credit Enhancement (CE): CE is provided by excess spread and overcollateralization. Additionally, the class A notes benefit from subordination provided by the class B notes. Excess cash may be released from the trust, provided that total parity is at least at 100.25%. As of September 2015, the total and senior parity levels were 101.98% and 111.01%, respectively. Fitch only gave credit up to the release level. Adequate Liquidity Support: Liquidity support is provided by a reserve account. The reserve is sized equal to the greater of 0.25% of the current pool balance and $1,968,753 floor. The current reserve balance is at its floor. Acceptable Servicing Capabilities: Xerox and Great Lakes are servicers of this trust. In Fitch's opinion, all the servicers are acceptable servicers of FFELP student loans. Fitch reviewed College Loan Corporation Trust 2005-2 using its existing and proposed FFELP ABS (News - Alert) criteria, listed below. 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. DUE DILIGENCE USAGE No third party due diligence was provided or reviewed in relation to this rating action. Fitch has affirmed the following ratings: College Loan Corporation Trust Series 2005-2 --Class A-3 at 'AAAsf'; Outlook Stable; --Class A-4 at 'AAAsf'; Outlook Stable; --Class B at 'A+sf'; Outlook Stable. Additional information is available at www.fitchratings.com. Applicable Criteria Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014) https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158 Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds (pub. 19 Dec 2014) https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=838868 Global Structured Finance Rating Criteria (pub. 06 Jul 2015) https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952 Rating Criteria for Structured Finance Servicers (pub. 23 Apr 2015) https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864375 Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria (pub. 23 Jun 2014) https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=750530 Related Research Exposure Draft: Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=872755 Additional Disclosures Dodd-Frank Rating Information Disclosure Form https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=994408 Solicitation Status https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=994408 Endorsement Policy https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31 ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON (News - Alert) THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE. View source version on businesswire.com: http://www.businesswire.com/news/home/20151119006164/en/ |
