Fitch Affirms Rhode Island Student Loan Authority 2008 Trust

NEW YORK--()--Fitch Ratings has affirmed the ratings on the outstanding senior class A and subordinate class I notes for the Rhode Island Student Loan Authority (RISLA) 2008 Trust. The Rating Outlook on the notes is Stable. Fitch's 'U.S. Private SL ABS Criteria' and 'Global Structured Finance Rating Criteria' were used to review the ratings. A complete list of rating actions follows at the end of this release.

KEY RATING DRIVERS

The rating affirmation of the senior class A notes at 'AAAsf' and subordinate class I notes at 'Asf' is based on loss coverage multiples commensurate with the notes' assigned ratings and is based on the collateral performance data as of Sept. 30, 2013. Fitch has maintained the Rating Outlook on the RISLA 2008 Trust notes at Stable as the trust continues to perform in-line with expectations.

Collateral Quality: The trust is collateralized by approximately $48.1 million of private student loans as of Sept. 30, 2013 and performance is in line with initial expectations as shown by current defaults at 1.77% at a 80.5% pool factor. The collateral supporting the RISLA 2008 Trust notes consists entirely of private student loans originated under RISLA's Rhode Island Family Education Loan (RIFEL) program. Fitch projects remaining defaults, as a percentage of current principal, to range between 4%-7% for the trust. A 50% recovery rate was used in the analysis based on the updated recovery data provided by RISLA.

Credit Enhancement: Credit enhancement consists of excess spread and overcollateralization. In addition, the class A notes benefit from subordination from the class I notes. As of Sept. 30, 2013, senior parity increased to 139.73% from the last review at 133.07% and total parity was 127.31%, an increase from the last review at 122.61%. The trust can only release excess funds back to RISLA if total trust parity is at least 125% and as such Fitch's analysis only gives credit to total parity at 125%.

Liquidity Support: The trust benefits from a reserve account sized at 4% of the outstanding principal balance.

Servicing Capabilities: Day to day servicing is provided by RISLA. Fitch believes the servicing operations are acceptable at this time.

Loss coverage multiples were determined by comparing projected net loss amounts to available credit enhancement. Fitch used historical vintage loss data provided by the Rhode Island Student Loan Authority to form a loss timing curve representative of the RISLA 2008 Trust's collateral pool. After giving credit for seasoning of loans in repayment, Fitch applied the trust's current cumulative gross loss level to this loss timing curve to derive the expected gross losses over the projected remaining life. Fitch assumed excess spread to be the lesser of the current annualized excess spread (earning on the assets minus interest payments to bondholders and fees) and the most recent 12-month average excess spread, and applied that same rate over the stressed projection of remaining life.

RATING SENSITIVITIES

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 affirms the Rhode Island Student Loan Authority 2008 Trust notes as follows:

Rhode Island Student Loan Authority 2008 Trust
--Series 2008A 12-01-2014 at 'AAAsf'; Outlook Stable;
--Series 2008A 12-01-2015 at 'AAAsf'; Outlook Stable;
--Series 2008A 12-01-2016 at 'AAAsf'; Outlook Stable;
--Series 2008A 12-01-2017 at 'AAAsf'; Outlook Stable;
--Series 2008A Term 12-01-2018 at 'AAAsf'; Outlook Stable;
--Series 2008A Term 12-01-2023 at 'AAAsf'; Outlook Stable;
--Series 2008A Term 6-01-2028 at 'AAAsf'; Outlook Stable;
--Series 2008I Term 12-01-2028 at 'Asf'; Outlook Stable.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research:

Applicable Criteria and Related Research:
--'U.S. Private Student Loan ABS Criteria', Jan. 29, 2013;
--'Global Structured Finance Rating Criteria', May 24, 2013.

Applicable Criteria and Related Research:
U.S. Private Student Loan ABS Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=698293
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708661

Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=812139
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 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.

Contacts

Fitch Ratings
Primary Analyst:
Autumn Mascio, +1-212-908-0896
Director
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson:
Tracy Wan, +1-212-908-9171
Senior Director
or
Media Relations:
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com

Sharing

Contacts

Fitch Ratings
Primary Analyst:
Autumn Mascio, +1-212-908-0896
Director
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson:
Tracy Wan, +1-212-908-9171
Senior Director
or
Media Relations:
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com