Sallie Mae Bank is preparing its second private student loan securitization of the year, according to Fitch Ratings.
The $657 million SMB Private Education Loan Trust 2016-B will issue three tranches of senior notes with preliminary ‘AAA’ ratings that benefit from 19.01% credit enhancement. There is also a subordinate tranche with 12.33% credit enhancement rated ‘A.’
The notes are backed by private student loans originated by Sallie Mae; borrowers in the pool have a weighted average FICO score at origination of 747; 95% of the loans in the pool were made to four-year schools; 92% of the loans in the pool were co-signed; and none of the loans were more than 30 days past due or involved in a bankruptcy proceeding.
The pool is geographically diverse, with the largest state concentrations in New York (10.45%), California (10.04%), Pennsylvania (9.20%), New Jersey (7.28%) and Illinois (5.53%). The top five states represent approximately 43% of the pool.
Compared with recent previous Sallie Mae transactions, the pool has a slightly higher percentage of loans in repayment status at 64%; however, the FICO score and co-signer percentages have remained over 740 and 90%, respectively.