Fitch Ratings affirms the 'AAsf' student loan notes issued by Vermont Student Assistance Corporation, series 2011-A1 (VSAC 2011-A1). The Rating Outlook remains Stable. A detailed list of rating actions follows at the end of this press release.
Fitch's Global Structured Finance Rating Criteria and Private Student Loan ABS Criteria were used to review the transaction.
KEY RATING DRIVERS
Adequate Collateral Quality: The trust is collateralized by approximately $11.79 million of fixed rated private student loans as of May 2014. The loans were originated by VSAC. Fitch projected remaining defaults to range between 15% - 17% as of the current principal balance based on data provided by VSAC. A recovery rate of 15% was applied.
Sufficient Credit Enhancement (CE): CE is provided by overcollateralization (the excess of trust's asset balance over bond balance) and excess spread. As of March 2014, the parity ratio is at 140.19%.
Adequate Liquidity Support: is provided by a debt service reserve (DSR) and a Capitalized Interest and Supplemental Account (CAPIS) sized at approximately $1.81 million and $0.96 million, respectively.
Moral Obligation:
The trust benefits from the moral obligation provided by the state of Vermont. State law provides that VDAC shall annually determine and certify to the Governor, Senate President, and House Speaker on or before Dec. 1, the amount (if any) needed to restore the DSR to its requirement.
Satisfactory Servicing Capabilities: Day-to-day servicing is provided by VSAC. Fitch believes the servicing operations are acceptable at this time.
Fitch has affirmed the following ratings and Outlooks:
Vermont Student Assistance Corporation, series 2011-A1:
--Class A-1 (2014) at 'AAsf'; Outlook Stable;
--Class A-1 (2015) at 'AAsf'; Outlook Stable;
--Class A-1 (2016) at 'AAsf'; Outlook Stable;
--Class A-1 (2017) at 'AAsf'; Outlook Stable;
--Class A-1 (2018) at 'AAsf'; Outlook Stable;
--Class A-1 (2019) at 'AAsf'; Outlook Stable;
--Class A-1 (2020) at 'AAsf'; Outlook Stable;
--Class A-1 (2021) at 'AAsf'; Outlook Stable;
--Class A-1 (2022) at 'AAsf'; Outlook Stable;
--Class A-1 (2023) at 'AAsf'; Outlook Stable;
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research:
--'U.S. Private Student Loan ABS Criteria' (Jan. 29, 2014);
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=7...
--'Global Structured Finance Rating Criteria' (May 20, 2014).
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=7...
Additional Disclosure: Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=833217
New York, NY 6.5.2014 Business Wire