Navient, the student loan servicer spun off from Sallie Mae in April, is planning a $747 million securitization of Federal Family Education Loan Program loans.

The $747 million transaction, dubbed Navient Student Loan Trust 2014-1, is backed by Federal Family Education Loan Program (FFELP) loans, according to a Fitch Ratings presale report.

The trust will issue four tranches of securities with preliminary 'AAA' ratings totalling $727 million. The class A1 notes are due March 25, 2021, the class A2 notes are dues March 27, 2023, the class A3 notes are due June 25, 2031, and the class A4 notes are due February 25, 2039. All of the class A notes benefit from credit enhancement of 3.55%.

The trust will also issue $20 million in ‘A+’-rated class B notes due June 25, 2048.

Navient assumed the servicing role previously provided by Sallie Mae, which began servicing FFELP loans in the early 1980s and private student loans in the early 1990s. Navient currently services over $300 billion of student loans, according to the Fitch presale reportFFELP-backed student loans securities accounted for $5.9 billion of the $7.1 billion of student loan ABS that has been issued year-to-date according to Standard & Poor’s.

The latest deal to price is Nelnet’s $385mn FFELP student loan, NSLT 2014-4 ABS. According to S&P, the 6-year senior tranche priced at one month Libor plus 54 basis points.

 

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