Fitch Affirms SLM 2011-3 Notes

NEW YORK--()--Fitch Ratings has affirmed the senior notes at 'AAAsf' and subordinate notes at 'AAsf' for SLM Student Loan Trust 2011-3 (SLM 2011-3). The Rating Outlook remains Stable for all notes.

KEY RATING DRIVERS

High Collateral Quality: The trust collateral comprises Federal Family Education Loan Program (FFELP) loans with guaranties provided by eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch's current U.S. sovereign rating is '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), excess spread, and for the senior notes, subordination of the class B notes. As of June 2015, total parity is 105.82% (5.50% CE) and senior parity is 110.49% (9.49% CE). The trust has been releasing cash given the specified OC amount, equal to the greater of 5.5% of the adjusted pool balance and $10,000,000, is maintained. The senior class A and subordinate class B notes pass cash flow stresses commensurate with their current ratings of 'AAAsf' and 'AAsf', respectively.

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 $1,197,171, and a capitalized interest fund which currently has a balance of $44 million with a scheduled declining balance which terminates February 2017.

Acceptable Servicing Capabilities: Navient Corporation (formerly known as Sallie Mae, Inc.) is the master servicer and administrator for SLM 2011-3. Day-to-day servicing is provided by Xerox-ES (formerly known as ACS Education Services, Inc.). Fitch believes Xerox-ES is 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 build-up of credit enhancement driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

Fitch has affirmed the following:

SLM Student Loan Trust, Series 2011-3:

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

--Class B at 'AAsf'; Outlook Stable.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria (pub. 23 Jun 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=750530

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=989185

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=989185

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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Contacts

Fitch Ratings
Primary Analyst
Jeffrey Prackup
Director
+1-212-908-0839
Fitch Ratings, Inc.
33 Whitehall Street
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
Email: sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Jeffrey Prackup
Director
+1-212-908-0839
Fitch Ratings, Inc.
33 Whitehall Street
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
Email: sandro.scenga@fitchratings.com