Fitch to Rate SLM Student Loan Trust 2013-2; Presale Issued
NEW YORK -- April 2, 2013
Fitch Ratings expects to rate SLM Student Loan Trust 2013-2 as follows:
--$1,211,000,000 floating rate class A notes, 'AAAsf(exp)'; Outlook Negative;
--$35,000,000 floating rate class B notes, 'A+sf(exp)'; Outlook Stable.
KEY RATING DRIVERS
--High Collateral Quality: The trust collateral consists of 100% FFELP student
loans with guaranties provided by the transaction's eligible guarantors for at
least 97% of principal and accrued interest, and the reinsurance provided by
the U.S. Department of Education (ED).
--Sufficient Credit Enhancement (CE): Cash flow scenarios for the class A and
B notes were satisfactory under Fitch's stresses. At closing, total parity is
expected to be 100.80% and senior parity is expected to be 103.71%. Total
credit enhancement (CE) is provided by overcollateralization (OC; about $9.95
million at closing), excess spread, and, in the case of class A notes, 2.8%
subordination provided by the class B notes.
--Adequate Liquidity Support: Liquidity support for the SLM 2013-2 notes is
provided by a $7.49 million reserve account (0.60% of outstanding notes),
funded at closing with note proceeds.
--Satisfactory Servicing Capabilities: Sallie Mae, Inc., as servicer, will be
responsible for servicing the 2013-2 portfolio. Fitch believes Sallie Mae is
an acceptable servicer of FFELP student loans.
--Negative Rating Outlooks Assigned: Fitch's Rating Outlook for all existing
and new issuances of 'AAAsf' rated tranches of FFELP securitizations remains
Negative, which reflects Fitch's Negative Rating Outlook on the long-term
foreign and local currency Issuer Default Ratings (IDRs) of the U.S.
The ratings assigned to senior tranches of most FFELP securitizations will
likely move in tandem with the U.S. sovereign rating given the strong linkage
to the U.S. sovereign, by nature of the reinsurance and SAP payment provided
by the U.S. Department of Education. Sovereign risks are not addressed in
Fitch's sensitivity analysis.
Fitch's stress analysis is discussed in the presale titled 'SLM Student Loan
Trust 2013-2', dated Apr. 2, 2013.
The presale report is available to all investors on Fitch's website at
'www.fitchratings.com'. For more information about Fitch's comprehensive
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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);
--'Rating U.S. Federal Family Education Loan Program Student Loan ABS
Criteria' (April 3, 2012).
Applicable Criteria and Related Research SLM Student Loan Trust 2013-2 (US
Global Structured Finance Rating Criteria
Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria
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Charlene M. Davis, +1-212-908-00213
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
Tracy Wan, +1-212-908-9171
Sandro Scenga, +1-212-908-0278 (New York)
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