Fitch Affirms Massachusetts Educational Finance Authority Issue J, Series 2011 and 2012

NEW YORK--()--Fitch Ratings affirms the ratings of the student loan revenue bonds issued by Massachusetts Educational Financing Authority (MEFA), Issue J series 2011 and 2012 at 'Asf'. The Rating Outlook remains Stable.

A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

Adequate Collateral Quality: The trust is collateralized by approximately $250 million of private student loans as of December 2014. The loans were originated under MEFA's Student Loan Program. The projected remaining defaults are expected to range between 5%-7% of the current pool balance.

Sufficient Credit Enhancement (CE): CE is provided by overcollateralization (the excess of trust's asset balance over bond balance) and excess spread. Currently, the trust is releasing excess cash since it has reached its release parity threshold of 109%.

Adequate Liquidity Support: Liquidity support is provided by a $5.1 million debt service reserve fund.

Adequate Servicing Capabilities: Day-to-day servicing is provided by Xerox Education Services. Fitch believes their servicing operation is acceptable.

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 Stable rating actions, depending on the extent of the decline in coverage. Fitch will continue to monitor the performance of the trust.

Fitch affirms the following ratings:

Massachusetts Educational Financing Authority (MEFA) Education Loan Revenue Bonds, Issue J series 2011 and series 2012:

--Series 2011 maturing on July 1, 2017 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2018 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2019 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2019 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2020 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2020 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2021 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2022 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, /2023 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2024 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2025 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2026 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2027 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2028 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2029 at 'Asf'; Outlook Stable;

--Series 2011 maturing on July 1, 2033 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2018 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2018 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2019 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2019 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2020 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2020 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2021 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2021 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2022 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2023 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2024 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2025 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2026 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2027 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2028 at 'Asf'; Outlook Stable;

--Series 2012 maturing on July 1, 2030 at 'Asf'; Outlook Stable.

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

Applicable Criteria and Related Research:

--'U.S. Private Student Loan ABS Criteria', January 2014;

--'Global Structured Finance Rating Criteria', March 2015;

--'Massachusetts Educational Financing Authority, Series 2012', May 2012.

A comparison of the transaction's RW&Es to those of typical RW&Es for student loans is available by accessing the reports and links below:

--'Massachusetts Educational Financing Authority, Series 2012 - Appendix' dated May 2012;

--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions', dated March 2015.

Applicable Criteria and Related Research:

U.S. Private Student Loan ABS Criteria

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

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864268

Massachusetts Educational Financing Authority, Series 2012 (US ABS)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679912

Massachusetts Educational Financing Authority, Series 2012 -- Appendix

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=680029

Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=863817

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=983015

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
Emily Lee
Director
+1 212-908-0667
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Michael Dean
Managing Director
+1 212-908-9156
or
Media Relations:
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Emily Lee
Director
+1 212-908-0667
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Michael Dean
Managing Director
+1 212-908-9156
or
Media Relations:
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com