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NEW YORK--([ BUSINESS WIRE ])--Fitch Ratings has affirmed the senior student loan notes issued by New Mexico Educational Assistance Foundation- 1998 Trust Indenture (NM) at 'AAAsf' and upgraded the subordinate note to 'Asf' from 'BBBsf'. The Rating Outlook for the senior notes, which is tied to the sovereign rating of the U.S. government, remains Negative. The Rating Outlook for the subordinate notes remains Stable. Fitch also affirms the short-term ratings of the senior variable-rate demand bonds (VRDBs) at 'F1+'.
Fitch affirms the ratings on the senior notes based on the sufficient level of credit enhancement to cover the applicable risk factor stresses. Credit enhancement for the senior notes consists of overcollateralization, projected minimum excess spread, and subordination provided by the class B notes.
Fitch upgrades the subordinate note to 'Asf' due to sufficient level of credit enhancement to cover the 'Asf' level stresses. Credit enhancement for the subordinate note consists of overcollateralization and projected minimum excess spread.
The short-term ratings on the VRDB senior notes are based on the support provided by a direct-pay letter of credit (LOC) issued by Royal Bank of Canada (RBC) (currently rated 'AA/F1+' with a Stable Outlook by Fitch). RBC is obligated to make payments of interest and principal on the bonds upon maturity, acceleration, and redemption, as well as the purchase price for tendered bonds. Therefore, the short-term ratings on the notes will continue to be based solely on the rating of RBC.
Fitch used its 'Global Structured Finance Rating Criteria' and 'Rating U.S. Federal Family Education Loan Program Student Loan ABS' to review the ratings.
Ratings actions are based on data as of June 30, 2012, provided by New Mexico Educational Assistance Foundation.
Fitch has affirmed the following ratings:
New Mexico Educational Assistance Foundation- 1998 Trust Indenture (NM):
Series 2001
--Class A-1 affirmed at 'AAAsf' and 'F1+'; Outlook Negative;
--Class B upgraded to 'Asf' from 'BBBsf'; Outlook Stable.
Series 2002
--Class A-1 affirmed at 'AAAsf'; Outlook Negative;
--Class A-2 affirmed at 'AAAsf' and 'F1+'; Outlook Negative.
Series 2003
--Class A-1 affirmed at 'AAAsf' and 'F1+'; Outlook Negative;
--Class A-2 affirmed at 'AAAsf' and 'F1+'; Outlook Negative.
Series 2004
--Class A-1 affirmed at 'AAAsf' and 'F1+'; Outlook Negative;
--Class A-2 affirmed at 'AAAsf' and 'F1+'; Outlook Negative;
--Class A-3 affirmed at 'AAAsf' and 'F1+'; Outlook Negative.
Series 2007
--Class A-1 affirmed at 'AAAsf'; Outlook Negative;
--Class A-2 affirmed at 'AAAsf'; Outlook Negative.
Series 2009
--Class B-2015 affirmed at 'AAAsf'; Outlook Negative;
--Class B-2016 affirmed at 'AAAsf'; Outlook Negative;
--Class B-2017 affirmed at 'AAAsf'; Outlook Negative;
--Class B-2018 affirmed at 'AAAsf'; Outlook Negative;
--Class B-2019 affirmed at 'AAAsf'; Outlook Negative;
--Class B-2020 affirmed at 'AAAsf'; Outlook Negative;
--Class C-2014 affirmed at 'AAAsf'; Outlook Negative;
--Class C-2015 affirmed at 'AAAsf'; Outlook Negative.
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' (April 3, 2012).
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
[ http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679923 ]
Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria
[ http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=675202 ]
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