Two FFELP student loan deals — Scholar Funding Trust 2010-A and NC State Education Assistance Authority Student Loan Revenue Bonds, Series 2010-1 — are in the market.
The $383.1 million Scholar Funding deal is lead managed by JPMorgan Securities. JPMorgan Chase Bank is the sponsor and seller of the transaction,
Proceeds from the bond sale will be used to acquire around $390 million of FFELP student loans, according to a Fitch Ratings presale report, and fund initial deposits to the reserve account and capitalized interest account.
The rating agency said that the trust collateral consists of 100% FFELP rehabilitated student loans.
Inspite of the the high gross default rate Fitch project for this pool, Fitch analysts believe that the trust collateral's credit quality remains high. This is based on the guarantees offered by the deal's eligible guarantors as well as the reinsurance given by the U.S. Department of Education for at least 97% of principal and accrued interest for the FFELP loans.
Meanwhile, the NC State Education Assistance Authority (NCSEAA) offering is worth $908 million. According to a Fitch presale on the deal, the series 2010-1 notes will be issued pursuant to the general resolution dated around Sept. 14 between NCSEAA and The Bank of New York Mellon Trust Co., which serves a the trustee on the SLABS.
The proceeds will be for redeeming all of the existing auction-rate notes that are held under the 1995 general resolution and other privately placed notes where the loans will be transferred to the series 2010-1 resolution.
The only notes remaining in the 1995 general resolution after the refunding will be the series 2005P notes that are indexed to Libor. The rating agency is expecting to confirm the remaining Libor notes' triple-A ratings.
For more details on the deal, please click the link below from the ASR Scorecards database.