Fitch Affirms SLM 2002-5 and SLM 2002-6; Outlook Stable

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings affirms the rating on the SLM Student Loan Trust 2002-5 and SLM Student Loan Trust 2002-6 senior and subordinate notes at 'AAAsf'. The Outlook remains Stable.

A full list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

High Collateral Quality: The trusts collateral are comprised of 100% of Federal Family Education Loan Program (FFELP) loans. The credit quality of the trust collateral is high, in Fitch's opinion, based on the guarantees provided by the transaction's eligible guarantors and reinsurance provided by the U.S. Department of Education (ED) for at least 97% of principal and accrued interest. Fitch currently rates the U.S. sovereign at 'AAA' with a Stable Outlook.

Sufficient Credit Enhancement: CE is provided by excess spread and, for the class A notes, subordination of the class B notes. As of February 2015, total parity ratios are 111.89% (10.63% CE) for SLM 2002-5 and 111.43% (10.26% CE) for SLM 2002-6. Given that the reserve is excluded from parity calculations since pool factors are below 40%, total effective parity ratios for the SLM 2002-5 and SLM 2002-6 trusts are 114.97% and 114.27%, respectively. The trusts are in turbo and no cash will be released until all notes have been paid in full.

Adequate Liquidity Support: Liquidity support is provided by reserve accounts sized at $1,325,707 and $2,003,707 for the SLM 2002-5 and SLM 2002-6 trusts, respectively.

Acceptable Servicing Capabilities: Day to day servicing is provided by Navient Solutions, Inc. (formerly known as Sallie Mae, Inc.), In Fitch's opinion, Navient is an acceptable servicer of FFELP student loans

RATING SENSITIVITIES

Since the FFELP student loan ABS relies on the U.S. government to reimburse defaults, 'AAAsf' FFELP ABS ratings will likely move in tandem with the 'AAA' U.S. sovereign rating. Aside from the U.S. sovereign rating, defaults and basis risk account for the majority of the risk embedded in FFELP student loan transactions. Additional defaults and basis shock beyond Fitch's published stresses could result in future downgrades. Likewise, a build-up of CE driven by positive excess spread given favorable basis factor conditions could lead to future upgrades.

DUE DILIGENCE USAGE

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

Fitch has affirmed the following ratings:

SLM Student Loan Trust 2002-5

--$1,128,106 class A-4L notes at 'AAAsf; Outlook Stable

--$1,851,884 class A-4CP notes at 'AAAsf; Outlook Stable

--$40,000,000 class B notes at 'AAAsf'; Outlook Stable

SLM Student Loan Trust 2002-6

--$7,399,342 class A-4L notes at 'AAAsf'; Outlook Stable

--$2,487,174 class A-4CP notes at 'AAAsf'; Outlook Stable

--$60,700,000 class B notes at 'AAAsf'; Outlook Stable

Additional information is available at www.fitchratings.com.

Applicable Criteria

Global Structured Finance Rating Criteria (pub. 31 Mar 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864268

Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria (pub. 23 Jun 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=750530

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=986055

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/20150608006638/en/

Fitch Ratings
Media Relations
Sandro Scenga, New York
Tel: +1 212-908-0278
Email: [email protected]
or
Primary Analyst
Paul Jiang
Associate Director
+1 212-908-9120
Fitch Ratings, Inc.
33 Whitehall St.
New York, NY 10004
or
Committee Chairperson
Tracy Wan
Senior Director
+1 212-908-9171

Source: Fitch Ratings

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