Fitch Affirms 4 National Collegiate Student Loan Trust Transactions

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed the ratings on the following outstanding notes issued by National Collegiate Trusts 2006-1, 2006-2, 2006-3 and 2006-4. Fitch has also revised some recovery estimates (RE).

National Collegiate Student Loan Trust 2006-1

--Class A-4 at 'Csf'; RE revised to 75% from 70%;

--Class A-5 at 'Csf'; RE revised to 75% from 70%;

--Class B at 'Csf'; RE 0%;

--Class C at 'Csf'; RE 0%.

National Collegiate Student Loan Trust 2006-2

--Class A-3 at 'Csf'; RE revised to 65% from 55%;

--Class A-4 at 'Csf'; RE revised to 65% from 55%;

--Class B at 'Csf'; RE 0%;

--Class C at 'Csf'; RE 0%.

National Collegiate Student Loan Trust 2006-3

--Class A-3 at 'CCsf'; RE revised to 80% from 70%;

--Class A-4 at 'CCsf'; RE revised to 80% from 70%;

--Class A-5 at 'CCsf'; RE revised to 80% from 70%;

--Class B at 'Csf'; RE 0%;

--Class C at 'Csf'; RE 0%;

--Class D at 'Csf'; RE 0%.

National Collegiate Student Loan Trust 2006-4

--Class A-2 at 'Csf'; RE revised to 70% from 65%;

--Class A-3 at 'Csf'; RE revised to 70% from 65%;

--Class A-4 at 'Csf'; RE revised to 70% from 65%;

--Class B at 'Csf'; RE 0%;

--Class C at 'Csf'; RE 0%;

--Class D at 'Csf'; RE 0%.

KEY RATING DRIVERS

Collateral Quality: All trusts are collateralized by private student loans originated by various financial institutions and lenders and securitized by First Marblehead Corporation. At deal inception all loans were guaranteed by The Education Resources Institute (TERI); however, no credit was given to the TERI guaranty since TERI filed for bankruptcy on April 7, 2008.

Credit Enhancement (CE): CE is provided by the generation of excess spread. Additionally, the senior notes will benefit from subordination from lower notes. The projected remaining defaults for all trusts range from 26% to 29% of the current balance. Current loss coverage multiples are commensurate with the current ratings for each transaction.

Liquidity Support: Support for the notes is provided by a reserve account for each trust.

Servicing Capabilities: The portfolio is serviced by American Education Services (AES), ACS Education Services (ACS), Firstmark Services LLC, Great Lakes Educational Loan Services Inc., and Nelnet for Series 2006-3, only. Fitch believes these servicers are acceptable servicers of private student loans.

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 negative rating actions, depending on the extent of the decline in coverage.

DUE DILIGENCE USAGE

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

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 01 Sep 2016)

https://www.fitchratings.com/site/re/886006

Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds (pub. 17 May 2016)

https://www.fitchratings.com/site/re/879815

Global Structured Finance Rating Criteria (pub. 27 Jun 2016)

https://www.fitchratings.com/site/re/883130

U.S. Private Student Loan ABS Criteria (pub. 31 Jul 2015)

https://www.fitchratings.com/site/re/868836

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1011795

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1011795

Endorsement Policy

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

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.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160916005479/en/

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, +1-212-908-0278
[email protected]

Source: Fitch Ratings

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