Fitch Affirms SLM Private Education Loan Trust 2013-C; Outlook Stable

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed the outstanding student loan notes issued by SLM Private Education Loan Trust 2013-C (SLM 2013-C) as follows:

--Class A-1 at 'AAAsf'; Outlook Stable;

--Class A-2A at 'AAAsf'; Outlook Stable;

--Class A-2B at 'AAAsf'; Outlook Stable;

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

KEY RATING DRIVERS

Collateral Quality: The trust is collateralized by approximately $573.84 million of private student loans originated by Navient Corp. under the Smart Option Program, Signature Education Loan Program, LAWLOANS program, MBA Loans program, MEDLOANS program, Direct to Consumer program, and Consolidation Loan Program. The projected remaining defaults are expected to range between 7% - 13% of the current principal balance. A recovery rate of 13% was assumed in Fitch's cash flow analysis.

Credit Enhancement (CE): CE is provided by overcollateralization, excess spread, and the senior class notes benefit from subordination provided by the junior class notes. As of the June 2016 distribution, the senior and total parity ratios are 189.89%, and 158.35%, respectively, compared to 163.79% and 142.33% for the same time last year. A specified over-collateralization amount is required to be maintained at the greater of 40% of the pool balance and $7,739,229. Currently, the trust's overcollateralization amount is equal to $215,931,453, excluding the reserve account.

Liquidity Support: Liquidity support is provided by a specified reserve account sized at approximately $1.93 million.

Servicing Capabilities: Day-to-day servicing is provided by Navient Solutions Inc., which has demonstrated satisfactory servicing capabilities.

Under the 'Counterparty Criteria for Structured Finance and Covered Bonds', dated July 18, 2016, Fitch looks to its own ratings in analyzing counterparty risk and assessing a counterparty's creditworthiness. The definition of the permitted investment for this deal allows the possibility of using investments not rated by Fitch; this represents a criteria variation. Fitch does not believe that such variation has a measurable impact on the ratings assigned.

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. 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.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 18 Jul 2016)

https://www.fitchratings.com/site/re/884963

Criteria for Servicing Continuity Risk in Structured Finance (pub. 17 Dec 2015)

https://www.fitchratings.com/site/re/875586

Fitch's Interest Rate Stress Assumptions for Structured Finance and Covered Bonds - Excel File (pub. 17 May 2016)

https://www.fitchratings.com/site/re/880522

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

Related Research

SLM Private Education Loan Trust 2013-C -- Appendix

https://www.fitchratings.com/site/re/718617

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1010978

ABS Due Diligence Form 15E 1

https://www.fitchratings.com/creditdesk/press_releases/content/ridf15E_frame.cfm?pr_id=1010978&flm_nm=15e_1010978_1.pdf

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1010978

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/20160830006079/en/

Fitch Ratings
Primary Analyst
Jeffrey Prackup, +1-212-908-0839
Director
Fitch Ratings, Inc.
33 Whitehall St.
New York, NY 10004
or
Committee Chairperson
Tracy Wan, +1-212-908-9171
Senior Director
or
Media Relations
Sandro Scenga, New York, +1-212-908-0278
[email protected]

Source: Fitch Ratings

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