Fitch Rates Access Group's Private Student Loan Asset-Backed Notes, Series 2004-A.Business Editors NEW YORK--(BUSINESS WIRE)--May 6, 2004 Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. assigns ratings to the following Access Group Inc. private student loan asset-backed notes, series 2004-A notes: -- $137,515,000 Class A-1 Floating-Rate Notes Floating-rate note (FRN) Note whose interest payment varies with short-term interest rates. floating-rate note An unsecured debt issue with an interest rate that is reset at specified intervals (usually every six months) according to a , 'AAA'; -- $471,666,000 Class A-2 Floating-Rate Notes, 'AAA'; -- $42,550,000 Class A-3 Auction-Rate Notes, 'AAA'; -- $42,500,000 Class A-4 Auction-Rate Notes, 'AAA'; -- $38,600,000 Class B-1 Auction-Rate Notes, 'A'; -- $38,600,000 Class B-2 Auction-Rate Notes, 'A'. The ratings are based on the quality of the underlying collateral, consisting of private unsecured student loans originated under the Access Group Loan Program; the credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing within the trust; and the sound legal structure of the transaction. The ratings reflect the ability of the trust to pay note principal at maturity and timely interest, and do not address the ability of the trust to pay carryover carryover n. in taxation accounting, using a tax year's deductions, business losses or credits to apply to the following year's tax return to reduce the tax liability. (See: carryback) interest on the auction-rate notes or the ability of auction-rate noteholders to successfully redeem their notes at any auction. Credit enhancement for the trust consists of 10.0% subordination, a capitalized interest Capitalized interest Interest that is not immediately expensed, but rather is considered as an asset and is then amortized through the income statement over time. In the context of project financing, interest that is paid by additional borrowing. account, and excess spread. The capitalized interest account has been funded at closing with $137.7 million of issuance proceeds and used to cover interest shortfalls. The capitalized interest account has stepdown dates whereby certain lower minimum amounts will be required to be maintained in the account and any excess funds released as available funds. At closing, the proceeds from the sale of the 2004-A notes have been used to acquire approximately $511,660,000 in private student loans originated under the Access Group loan program and make deposits of approximately $120.0 million to the prefunding account and $137.7 million to the capitalized interest account. Amounts in the prefunding account are to be used to acquire additional private student loans through January 2005. Interest on the class A-1 and A-2 notes is indexed to the three-month London Interbank Offered Rate London Interbank Offered Rate A short-term interest rate often quoted as a 1,3,6-month rate for U.S.dollars. (LIBOR LIBOR See: London Interbank Offered Rate LIBOR See London interbank offered rate (LIBOR). ) plus .09% and .26%, respectively, and payable quarterly, beginning July 2004. Interest on the class A-3, A-4, and B notes is determined by Dutch auctions Dutch Auction An auction where the price on an item is lowered until it gets its first bid, and then the item is sold at that price. Notes: The U.S. Treasury (and other countries) uses a Dutch auction when it sells securities. to be held every 28 days and payable on the first business day following each auction date. The class A-3 notes are subject to mandatory redemption from the funds remaining in the prefunding account after January 2005. To a limited extent, after all floating-rate notes are redeemed, all classes of auction-rate notes are subject to mandatory redemption from available funds. |
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