Fitch Affirms SLC Private Student Loan Trust, Series 2006-A

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed the ratings on the Student Loan Corporation (SLC) Private Student Loan Trust Series 2006-A notes issued by SLC. The Rating Outlook remains Stable for all of the notes. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

Collateral Quality: The trust collateral consists of approximately $728 million of private student loans originated under Citibank's CitiAssist private student loan program and underwritten to specific guidelines. Projected remaining gross defaults are expected to be in the range of 7-11% of the current collateral balance. The trust benefits from third party insurance provided by New Hampshire Insurance Company for approximately 58% of the portfolio and Royal & Sun Alliance USA for 36% of the portfolio. Recovery is estimated to be 40-85% in different rating stress scenarios as Fitch differentiates between the credit given to insurance coverage based on the insurer's financial strength.

Credit Enhancement: CE is provided by overcollateralization (the excess of the trust's asset balance over the bond balance), and excess spread. As of the most recent distribution report, total parity is 103.21%. The senior notes also benefit from subordination provided by the lower class notes.

Liquidity support: Liquidity support is provided by a debt service reserve fund of $7,636,889.

Servicing Capabilities: SLC / Discover Bank is the master servicer and administrator of the trust, and the subservicer, Discover Products Inc. is a wholly owned subsidiary of Discover Bank. Fitch believes the servicing operation of Discover Products Inc. to be acceptable at this time.

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 bonds and may make certain bond ratings susceptible to potential negative rating actions, depending on the extent of the decline in coverage. Fitch will continue to monitor the performance of the trust.

DUE DILIGENCE USAGE

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

Fitch has affirmed the following ratings:

SLC Private Student Loan Trust 2006-A:

--Class A-5 at 'AAAsf'; Outlook Stable;

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

--Class C at 'Asf'; Outlook Stable.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds (pub. 19 Dec 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=838868

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

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

Rating Criteria for Structured Finance Servicers (pub. 23 Apr 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864375

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

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=868836

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=997951

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=997951

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/20160115005737/en/

Fitch Ratings
Primary Analyst
Nicole Edwards
Director
+1-212-908-9114
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Kevin Corrigan
Senior Director
+1-212-908-9156
or
Media Relations:
Sandro Scenga, +1 212-908-0278
[email protected]

Source: Fitch Ratings

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