TEXT - Fitch comments on Penn Higher Ed Assistance Agency 1997 Trust

Tue Feb 12, 2013 2:11pm EST

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Feb 12 - Fitch Ratings currently maintains ratings as listed below on the
student loan revenue bonds issued under the Pennsylvania Higher Education
Assistance Agency (PHEAA) indenture of trust dated as of Aug. 1, 1997, as
amended and supplemented (the 1997 Trust). Consistent with its statements on
policies regarding rating confirmations in structured finance transactions (Jan.
13, 2009) and student loan confirmations (May 8, 2009), Fitch is treating this
request for approval as a notification.

PHEAA has requested that Fitch approve a transfer of the Broker Dealer and 
Market Agent function to Morgan Stanley & Co. LLC. The transfer to a single 
counterparty for both functions would lower fees to 2.75 basis points (bps) per 
annum for failed auctions and 8bps per annum for successful auctions associated 
with all the bonds issued under the 1997 Trust as currently detailed in the 
Third Amended and Restated Cash Flow Assumption Certificate and Agreement (the 
Agreement) between PHEAA and Manufacturers and Traders Trust Company, as 
trustee. The Agreement contains language that requires 'Rating Agency approval' 
in connection with any modification of the terms, rates or fees detailed in the 
Agreement.

Based on the Broker Dealer and Market Agent agreements provided, Fitch has 
determined that the transfer to Morgan Stanley & Co. LLC as a single 
counterparty for both functions will not have an impact on the existing ratings 
of the bonds at this time. This determination only addresses the effect of the 
proposed change on the current ratings assigned by Fitch to the securities 
listed below. This determination does not address whether the proposed changes 
are permitted by the terms of the transaction documents. It does not address 
whether the proposed changes are in the best interests of, or prejudicial to, 
some or all of the holders of the securities listed.

Fitch currently rates the bonds as follows:

Pennsylvania Higher Education Assistance Agency 1997 Trust Indenture Senior 
Class Notes

--1998-1 Class C 'AAAsf'; Outlook Negative;
--2000-1 Class F-1 'AAAsf'; Outlook Negative;
--2000-1 Class F-2 'AAAsf'; Outlook Negative;
--2000-2 Class H 'AAAsf'; Outlook Negative;
--2000-3 Class J-2 'AAAsf'; Outlook Negative;
--2000-3 Class J-3 'AAAsf'; Outlook Negative;
--2000-3 Class J-4 'AAAsf'; Outlook Negative;
--2001 Class L-1 'AAAsf'; Outlook Negative;
--2001 Class L-2 'AAAsf'; Outlook Negative;
--2002-1 Class N-1 'AAAsf'; Outlook Negative;
--2002-1 Class N-2 'AAAsf'; Outlook Negative;
--2002-3 Class R-1 'AAAsf'; Outlook Negative;
--2002-3 Class R-2 'AAAsf'; Outlook Negative;
--2002-4 Class T-1 'AAAsf'; Outlook Negative;
--2002-4 Class T-2 'AAAsf'; Outlook Negative;
--2002-4 Class T-3 'AAAsf'; Outlook Negative;
--2002-4 Class T-4 'AAAsf'; Outlook Negative;
--2002-4 Class T-5 'AAAsf'; Outlook Negative;
--2002-5 Class V-1 'AAAsf'; Outlook Negative;
--2002-5 Class V-2 'AAAsf'; Outlook Negative;
--2002-5 Class V-3 'AAAsf'; Outlook Negative;
--2002-5 Class V-4 'AAAsf'; Outlook Negative;
--2003-1 Class W-1 'AAAsf'; Outlook Negative;
--2003-1 Class W-2 'AAAsf'; Outlook Negative;
--2003-2 Class Y-1 'AAAsf'; Outlook Negative;
--2003-2 Class Y-2 'AAAsf'; Outlook Negative;
--2003-2 Class Y-3 'AAAsf'; Outlook Negative;
--2003-2 Class Y-4 'AAAsf'; Outlook Negative;
--2004-1 Class Z-1 'AAAsf'; Outlook Negative;
--2004-1 Class Z-3 'AAAsf'; Outlook Negative;
--2004-1 Class Z-4 'AAAsf'; Outlook Negative;
--2004-2 Class AA-1 'AAAsf'; Outlook Negative;
--2004-2 Class AA-2 'AAAsf'; Outlook Negative;
--2004-3 Class BB-1 'AAAsf'; Outlook Negative;
--2004-3 Class BB-2 'AAAsf'; Outlook Negative;
--2004-3 Class BB-3 'AAAsf'; Outlook Negative;
--2004-3 Class BB-4 'AAAsf'; Outlook Negative;
--2005-1 Class CC-2 'AAAsf'; Outlook Negative;
--2005-1 Class CC-3 'AAAsf'; Outlook Negative;
--2005-2 Class DD-1 'AAAsf'; Outlook Negative;
--2005-2 Class DD-2 'AAAsf'; Outlook Negative;
--2005-3 Class EE-1 'AAAsf'; Outlook Negative;
--2005-3 Class EE-2 'AAAsf'; Outlook Negative;
--2005-3 Class EE-3 'AAAsf'; Outlook Negative;
--2005-3 Class EE-4 'AAAsf'; Outlook Negative;
--2005-4 Class GG-1 'AAAsf'; Outlook Negative;
--2005-4 Class GG-2 'AAAsf'; Outlook Negative;
--2005-4 Class GG-3 'AAAsf'; Outlook Negative;
--2005-4 Class GG-4 'AAAsf'; Outlook Negative;
--2005-4 Class GG-5 'AAAsf'; Outlook Negative;
--2006-1 Class HH-1 'AAAsf'; Outlook Negative;
--2006-1 Class HH-2 'AAAsf'; Outlook Negative;
--2006-1 Class HH-3 'AAAsf'; Outlook Negative;
--2006-1 Class HH-4 'AAAsf'; Outlook Negative;
--2006-1 Class HH-5 'AAAsf'; Outlook Negative;
--2006-1 Class HH-6 'AAAsf'; Outlook Negative;
--2006-1 Class HH-7 'AAAsf'; Outlook Negative;
--2006-1 Class HH-8 'AAAsf'; Outlook Negative;
--2006-1 Class HH-9 'AAAsf'; Outlook Negative;
--2006-1 Class HH-10 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-1 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-2 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-3 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-4 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-5 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-6 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-7 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-8 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-9 'AAAsf'; Outlook Negative;
--2006-2 Class JJ-10 'AAAsf'; Outlook Negative;
--2007 Class LL-2 'AAAsf'; Outlook Negative;
--2007 Class LL-3 'AAAsf'; Outlook Negative;
--2007 Class LL-4 'AAAsf'; Outlook Negative;
--2007 Class LL-5 'AAAsf'; Outlook Negative;
--2007 Class LL-6 'AAAsf'; Outlook Negative;
--2007 Class LL-7 'AAAsf'; Outlook Negative;
--2007 Class LL-8 'AAAsf'; Outlook Negative;
--2007 Class LL-9 'AAAsf'; Outlook Negative;
--2007 Class LL-10 'AAAsf'; Outlook Negative;
--2007 Class MM-1 'AAAsf'; Outlook Negative;
--2007 Class MM-2 'AAAsf'; Outlook Negative;
--2007 Class MM-3 'AAAsf'; Outlook Negative;
--2007 Class MM-4 'AAAsf'; Outlook Negative;
--2007 Class MM-5 'AAAsf'; Outlook Negative;
--2007 Class MM-6 'AAAsf'; Outlook Negative.

Pennsylvania Higher Education Assistance Agency 1997 Trust Indenture Subordinate
Class Notes
--2000-1 Class G 'BBB-sf'; Outlook Stable;
--2000-3 Class K 'BBB-sf''; Outlook Stable;
--2001 Class M 'BBB-sf'; Outlook Stable;
--2002-1 Class O 'BBB-sf'; Outlook Stable;
--2002-4 Class U 'BBB-sf'; Outlook Stable;
--2003-1 Class X 'BBB-sf'; Outlook Stable;
--2005-3 Class FF 'BBB-sf'; Outlook Stable;
--2006-1 Class II 'BBB-sf'; Outlook Stable;
--2006-2 Class KK 'BBB-sf'; Outlook Stable;
--2007 Class NN 'BBB-sf'; Outlook Stable.
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