Fitch Rates Kentucky Higher Education Student Loan Corporation Series 2006.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch rates the following student loan revenue bonds issued by Kentucky Higher Education Student Loan Corporation: Ratings for New Issuance: -- $60,000,000 senior series 2006A-4 (taxable auction rate certificates), 'AAA' Fitch assigns ratings to the new issuance of bonds as listed above. The ratings are based on the quality of the FFELP FFELP Federal Family Education Loan Program student loan portfolio, 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 provided and the legal structure. The ratings reflect the ability of the trust estate to pay bond principal at maturity and pay timely interest. The ratings do not address any carryover amounts that may accrue on the bonds nor do they address the ability of auction bondholders to redeem their bonds at an auction now or in the future. The series 2006 bonds are issued under an indenture dated Aug. 1, 2004 as supplemented by the Fifth Supplemental Indenture dated Aug. 1, 2006 by and between KHESLC KHESLC Kentucky Higher Education Student Loan Corporation and Wells Fargo Bank, N.A., the trustee. The series 2006 bonds are being issued to finance the origination and acquisition of Federal Family Education Loan Program The Federal Family Education Loan Program (FFELP) is a United States Department of Education program that provides for private organizations to market, originate, and service federally guaranteed loans, such as Stafford and PLUS loans to students and their parents. (FFELP) student loans, make a deposit to the debt service reserve fund, and pay the cost of issuance. The taxable series 2006 bonds are 28-day auction rate securities, with interest paid on the day following each auction period. The legal final maturity for the bonds is June 1, 2036. The reserve account is sized at 0.50% of the bonds outstanding with a $500,000 minimum. Funds in the reserve account can be used to pay timely interest on the bonds and principal at maturity. Currently, 100% of the collateral securing the bonds are loans originated under the Federal Family Education Loan Program (FFELP). The loans are guaranteed up to at least 97% of principal and accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. by an eligible guarantor(s), depending on loan origination date, and reinsured by the U.S. Department of Education up to the same amounts. Kentucky Higher Education Student Loan Corporation (KHESLC) is an independent de jure municipal corporation and political subdivision of the Commonwealth of Kentucky. Kentucky expects to service the trust's entire FFELP student loan portfolio. KHESLC currently services approximately $1.5 billion of student loans supporting its bonds outstanding, as well as approximately $6.3 billion of student loans on a third party basis. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. 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 Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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