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TEXT-S&P rates Vermont Student Assistance 2012-1 class A notes
November 28, 2012 / 7:21 PM / 5 years ago

TEXT-S&P rates Vermont Student Assistance 2012-1 class A notes

OVERVIEW
     -- Vermont Student Assistance Corp.'s issuance is an ABS securitization 
backed by student loans that are at least 97% reinsured by the U.S. federal 
government.
     -- We assigned our 'AA+ (sf)' rating to the class A notes.
     -- The 'AA+ (sf)' rating reflects our view of the transaction's senior 
parity, the U.S. federal government's reinsurance, the scenario analysis, and 
the transaction's payment and legal structures, among other factors.
    
     Nov 28 - Standard & Poor's Ratings Services today assigned its 'AA+ (sf)'
rating to Vermont Student Assistance Corp.'s $755.0 million class A student loan
asset-backed notes series 2012-1 (see list).

The note issuance is an asset-backed securitization backed by student loans 
that are at least 97% reinsured by the U.S. federal government.

The rating reflects our view of: 
     -- The transaction's initial senior parity of approximately 104.17%, 
which is defined as the percentage of the trust assets (the pool balance and 
the initial reserve fund) divided by the senior note principal amount;
     -- The U.S. federal government's reinsurance of at least 97% of the 
loans' principal and interest;
     -- The timely interest and principal payments made under stressed cash 
flow modeling scenarios that we believe are consistent with the assigned 'AA+ 
(sf)' rating;
     -- A scenario analysis indicating that under moderately stressful 
economic conditions (defined as 2.25x expected defaults) the rating would not 
decline more than one rating category in the first year, which is consistent 
with our credit stability criteria; and
     -- The transaction's payment and legal structures.
 
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT

SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating 
relating to an asset-backed security as defined in the Rule, to include a 
description of the representations, warranties and enforcement mechanisms 
available to investors and a description of how they differ from the 
representations, warranties and enforcement mechanisms in issuances of similar 
securities.

The Standard & Poor's 17g-7 Disclosure Report included in this credit rating 
report is available at "RELATED CRITERIA AND RESEARCH

Related Criteria
     -- Counterparty Risk Framework Methodology And Assumptions, May 31, 2012
     -- Global Investment Criteria For Temporary Investments In Transaction 
Accounts, May 31, 2012
     -- U.S. Interest Rate Assumptions Revised For May 2012 And Thereafter, 
April 30, 2012
     -- U.S. Government Support In Structured Finance And Public Finance 
Ratings, Sept. 19, 2011
     -- General Criteria: Principles Of Credit Ratings, Feb. 16, 2011
     -- Methodology: Credit Stability Criteria, May 3, 2010
     -- Methodology: Criteria for Global Structured Finance Transactions 
Subject to a Change in Payment Priorities upon a Nonmonetary EOD, March 16, 
2010
     -- Legal Criteria For U.S. Structured Finance Transactions: Overview Of 
Legal Criteria For U.S. Structured Finance Transactions, Oct. 1, 2006
     -- Student Loan Criteria: Student Loan Programs, Oct. 1, 2004
     -- Student Loan Criteria: The Rating Process For Student Loan 
Transactions, Oct. 1, 2004
     -- Student Loan Criteria: Evaluating Risk In Student Loan Transactions, 
Oct. 1, 2004
     -- Student Loan Criteria: Structural Elements In Student Loan 
Transactions, Oct. 1, 2004
     -- Student Loan Criteria: Rating Methodology For Student Loan 
Transactions, Oct. 1, 2004

Related Research
     -- Presale: Vermont Student Assistance Corp. - Series 2012-1, Nov. 14, 
2012
     -- Global Structured Finance Scenario And Sensitivity Analysis: The 
Effects Of The Top Five Macroeconomic Factors, Nov. 4, 2011
     -- United States Of America Long-Term Rating Lowered To 'AA+' On 
Political Risks And Rising Debt Burden; Outlook Negative, Aug. 5, 2011
 
RATING ASSIGNED
Vermont Student Assistance Corp. - Series 2012-1 

Class   Rating     Type          Interest                      Amount
                                 rate                        (mil. $)
A       AA+ (sf)   Senior        One-month LIBOR plus 0.70%     755.0
B       NR         Subordinate   One-month LIBOR plus 3.00%      15.5

NR-Not rated.

Our Standards:The Thomson Reuters Trust Principles.
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