Fitch Affirms SLM Student Loan Trust 2003-2

NEW YORK--()--Fitch Ratings affirms the ratings of the senior notes at 'AAAsf' and the subordinate notes at 'BBBsf' issued by SLM Student Loan Trust 2003-2. The Rating Outlook remains Stable for all notes.

KEY RATING DRIVERS

High Collateral Quality: The collateral consists of 100% 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 reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch affirmed the U.S. sovereign rating on March 24, 2014 at 'AAA' with a Stable Outlook.

Sufficient Credit Enhancement (CE): CE is provided by overcollateralization (OC; the excess of trust's asset balance over bond balance), and excess spread, and for the senior notes, subordination of the Class B notes. Current senior and total parity is 108.05% (7.45% CE). The trust has been releasing cash given that the trust has maintained its cash release level of 100% total parity.

Adequate Liquidity Support: Liquidity support is provided by a Debt Service Reserve Fund sized at the greater of 0.25% of the pool balance and $2,005,060.

Acceptable Servicing Capabilities: Sallie Mae, Inc. is responsible for the servicing of the trust. Fitch believes SLM Inc. to be an acceptable servicer of FFELP student loans.

RATING SENSITIVITIES

Since the FFELP student loan ABS relies 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 CE driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

Fitch has taken the following rating actions:

SLM Student Loan Trust 2003-2:

--Class A-5 affirmed at 'AAAsf'; Outlook Stable;

--Class A-6 affirmed at 'AAAsf'; Outlook Stable;

--Class A-7 affirmed at 'AAAsf'; Outlook Stable;

--Class A-8 affirmed at 'AAAsf'; Outlook Stable;

--Class A-9 affirmed at 'AAAsf'; Outlook Stable;

--Class B affirmed at 'BBBsf'; Outlook Stable.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (May 24, 2013);

--'Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria' (May 17, 2013);

--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' (April 17, 2012).

Applicable Criteria and Related Research:

Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions -- Amended

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=676496

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria -- Amended

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708795

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=827341

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Contacts

Fitch Ratings, Inc.
Jared Smith
Analyst
+1-212-908-0371
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson
Tracy Wan
Senior Director
+1-212-908-9171
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
sandro.scenga@fitchratings.com

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Contacts

Fitch Ratings, Inc.
Jared Smith
Analyst
+1-212-908-0371
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson
Tracy Wan
Senior Director
+1-212-908-9171
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
sandro.scenga@fitchratings.com