Fitch Affirms KeyCorp Student Loan Trust 1999-B

NEW YORK--()--Fitch Ratings affirms KeyCorp Student Loan Trust 1999-B mezzanine notes at 'AAAsf', and affirms the subordinate notes at 'A+sf'. The Rating Outlook for both classes remains Stable.

KEY RATING DRIVERS

High Collateral Quality: The collateral consists of approximately 58% private student loans, and 42% Federal Family Education Loan Program (FFELP) loans as of Jan. 31, 2014. The credit quality of the FFELP 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 at 'AAA' and assigned a Stable Outlook to the U.S. sovereign rating on March 24, 2014. Fitch has increased its remaining default projection to 7% - 9% as a percent of the current private loan balance from 4%-7% at the last review, with recoveries remaining at 15%.

Adequate Credit Enhancement: CE is provided by overcollateralization and excess spread. Current class M and total parities are 434.94% and 113.33%, respectively, and no cash is being released from the trust as all collections are being used to pay down the outstanding notes.

Servicing Capabilities: KeyBank N.A. serves as the Master Servicer for the trust loans, and Fitch believes the servicing operations are acceptable at this time.

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 has affirmed the following ratings:

KeyCorp Student Loan Trusts 1999-B:

--Class M at 'AAAsf'; Outlook Stable;

--Class B at 'A+sf'; Outlook Stable.

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

Applicable Criteria and Related Research:

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

--'U.S. Private Student Loan ABS Criteria' (Jan. 2014).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708661

U.S. Private Student Loan ABS Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=730956

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=830550

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Contacts

Fitch Ratings
Primary Analyst
Harry Kohl, +1-212-908-0837
Associate Director
Fitch Ratings, Inc.
33 Whitehall Street
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
Harry Kohl, +1-212-908-0837
Associate Director
Fitch Ratings, Inc.
33 Whitehall Street
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