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RHODE ISLAND STUDENT LOAN AUTHORITY 1993 A & B EXPECTED 'AAA' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Sept. 29 /PRNewswire/ -- Fitch expects to assign a "AAA" to the Rhode Island Student Loan Authority's student loan program revenue bonds $10 million 1993 senior series A and $17.6 million 1993 senior series B auction rate securities (ARS). The authority's $2.4 million 1993 subordinate series I bonds are expected to be rated "A".
 The ratings are expected to be assigned upon receipt and approval of final documents and cash flow projections.
 The ratings are based on expected purchases of Federal Family Education Loan Program (FFELP) loans, obligations of the U.S. Department of Education under FFELP, excellent servicing provided by UNIPAC, the authority's $600,000 contribution to the trust estate, and authority payment of costs of issuance from its unencumbered funds. If the authority fails to purchase loans to fully utilize the loan account, there will be sufficient funds to redeem the bonds early. The authority is a small secondary market with good quality loan portfolios securing its financings.
 The series A and B bonds are enhanced by subordination of the series I bonds, the $600,000 debt service reserve, and excess spread. The senior bonds are collateralized at 110.8 percent at bond closing. The series I bonds are enhanced by the 2 percent debt service reserve fund (initially $600,0000) and excess spread.
 The ratings reflect the ability of the trust estate to redeem bonds at maturity and pay accrued interest. Series A and B bonds ARS' ratings do not address the market liquidity or the ARS holder's ability to sell a beneficial interest in an ARS on any auction date, now or in the future. Should the rate payable on the ARS exceed the net yield available from the loans, the acquisition of loans will cease and all available funds will be directed to early redemption of the bonds. Based on the excess funds available and the unlikely expectation of such a yield inversion, Fitch believes the risk of negative arbitrage adversely affecting the bond ratings is very minimal.
 -0- 9/29/93
 /CONTACT: Betsy Hill of Fitch, 212-908-0612/


CO: Rhode Island Student Loan Authority ST: Rhode Island IN: FIN SU: RTG

TS -- NY005 -- 6657 09/29/93 08:41 EDT
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Publication:PR Newswire
Date:Sep 29, 1993
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