Fitch Ratings affirms the senior notes at 'AAAsf' and upgrades the subordinate note to 'BBBsf' from 'BBB-sf' issued by SLM Student Loan Trust 2007-7. The Rating Outlook for the senior notes, which is tied to the sovereign rating of the U.S. government, remains Negative. The Rating Outlook for the subordinate notes remains Stable.
The ratings on the senior notes are affirmed based on the sufficient level of credit enhancement to cover the applicable risk factor stresses. Credit enhancement for the senior notes consists of overcollateralization, subordination from junior notes and projected minimum excess spread.
The rating on the subordinate note is upgraded to 'BBBsf' from 'BBB-sf' due to the sufficient level of credit enhancement to cover the applicable basis factor stresses at the 'BBBsf' rating category. The trust has reduced basis risk exposure since the index used for SAP calculations was switched from 90-day CP to 1 Month LIBOR on April 1, 2012, affecting 91.77% of the underlying loans.
Fitch used its 'Global Structured Finance Rating Criteria,' and 'Rating U.S. Federal Family Education Loan Program Student Loan ABS' to review the ratings.
Fitch has taken the following rating actions:
SLM Student Loan Trust 2007-7:
--Class A-2 affirmed at 'AAAsf'; Outlook Negative.
--Class A-3 affirmed at 'AAAsf'; Outlook Negative.
--Class A-4 affirmed at 'AAAsf'; Outlook Negative.
--Class B upgraded to 'BBBsf' from 'BBB-sf'; Outlook Stable.
Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' dated Aug. 4, 2011;
--'Rating U.S. Federal Family Education Loan Program Student Loan ABS' dated April 3, 2012.
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646569
Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=675202
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