Fitch Rates Connecticut Higher Education Supplemental Loan Authority Bonds 'AAA'.

NEW YORK -- Fitch assigns 'AAA' ratings to the following Connecticut Higher Education Supplemental Loan Authority (CHESLA) Senior Revenue and Revenue Refunding Bonds (Connecticut Family Education Loan Program):

Ratings for new issuance:

-- $33,270,000 series 2006-A 'AAA'.

Ratings confirmed on existing debt:

-- $17,000,000 series 2003-A 'AAA';

-- $12,065,000 series 2003-B 'AAA';

-- $31,455,000 series 2005-A 'AAA';

-- $6,900,000 series 2005-B 'AAA'.

The 'AAA' ratings are based on the support of Financial Guaranty Insurance Policies provided by MBIA Insurance Corporation ('AAA' Insurer Financial Strength rating from Fitch). The 2006 series A bonds are issued under the 2003 Master Revenue Bond Resolution, dated June 10, 2003 and the 2006 series A Supplemental Revenue Bond Resolution, dated July 20, 2006.

Interest on the 2006 Series A bonds is tax-exempt, fixed rate and payable semi-annually on the 15th of each May and November, commencing Nov. 15, 2006. Certain maturities of the 2006 series A bonds are subject to mandatory sinking fund redemptions.

The Connecticut Higher Education Supplemental Loan Authority Act established that CHESLA must maintain a special capital reserve fund (SCRF) as security for the bonds. The SCRF requirement is defined as the lesser of the sum of the SCRF requirements for all bonds outstanding, or the maximum amount of principal and interest becoming due on the outstanding debt by reason of maturity or a required sinking fund payment in any given year. Upon closing, CHESLA made a $2,500,000 deposit to the SCRF from issuance proceeds in conjunction with the 2006 Series issuance. The SCRF established pursuant to the 2003 Master Resolution has been funded in connection with the issuance of the 2003 series Bonds and the 2005 series Bonds in the amounts of $2,200,000 and $3,000,000 providing a combined total reserve balance of $7,700,000. The trustee may draw upon the SCRF for any interest or principal debt service shortfall. Following any such draw, on an annual basis, there will be appropriated from the state general fund, without further legislative approval, an amount necessary to restore the SCRF to its required level.

The collateral consists of Connecticut Family Education Loan Program (CT FELP) student loans. The CT FELP loans are not guaranteed by the Department of Education and are self-insured by CHESLA. Undergraduate, graduate, and professional students are eligible for CT FELP student loans. Any CT FELP borrower must be enrolled half time at an accredited Connecticut school or be a Connecticut resident attending an accredited school; maintain satisfactory academic progress; and be deemed credit worthy by CHESLA. Interest rates on CT FELP loans are established at the time of issuance of the bonds at a fixed rate.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, '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.