Fitch Ratings affirms the senior student loan notes at 'AAAsf' and downgrades the subordinate and junior subordinate student loan notes to 'Bsf' from 'BBsf' issued by GCO Education Loan Funding Master Trust II. The Rating Outlook remains Stable. Fitch used its 'Global Structured Finance Rating Criteria', and 'U.S. FFELP Student Loan ABS Surveillance Criteria', as well as 'Rating U.S. Federal Family Education Loan Program Student Loan ABS' to review the ratings.
The ratings on the senior notes are affirmed based on the sufficient level of credit enhancement (consisting of subordination and the projected minimum excess spread) to cover the applicable risk factor stresses.
The ratings on the subordinate and junior subordinate notes are downgraded to 'Bsf' from 'BBsf' because the trust remains undercollateralized. The Fitch calculated total parity, which includes the junior subordinate notes, is 97.34%. The reported subordinate parity, which excludes the junior subordinate notes, is 99.75%.
Fitch has taken the following rating actions:
GCO Education Loan Funding Master Trust II:
--2006-2 A-1AR affirmed at 'AAAsf'; Outlook Stable;
--2006-2 A-1L PIF;
--2006-2 A-1RRN affirmed at 'AAAsf'; Outlook Stable;
--2006-2 A-2AR affirmed at 'AAAsf'; Outlook Stable;
--2006-2 A-2L affirmed at 'AAAsf'; Outlook Stable;
--2006-2 A-3AR affirmed at 'AAAsf'; Outlook Stable;
--2006-2 A-3L affirmed at 'AAAsf'; Outlook Stable;
--2006-2 A-4AR affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-4L PIF;
--2007-1 A-5AR affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-5L affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-6AR affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-6L affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-7AR affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-7L affirmed at 'AAAsf'; Outlook Stable;
--2007-1 A-8AR PIF;
--2006-2 B-1AR downgraded to 'Bsf' from 'BBsf'; Outlook Stable;
--2006-2 B-2AR downgraded to 'Bsf' from 'BBsf'; Outlook Stable;
--2006-2 B-3AR downgraded to 'Bsf' from 'BBsf'; Outlook Stable;
--2007-1 C-1L downgraded to 'Bsf' from 'BBsf'; Outlook Stable.
Additional information is available at 'www.fitchratings.com'
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' dated Aug. 13, 2010;
--'U.S.FFELP Student Loan ABS Surveillance Criteria' dated May 10, 2011;
--'Rating U.S. Federal Family Education Loan Program Student Loan ABS' dated April 7, 2011.
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646569
U.S. FFELP Student Loan ABS Surveillance Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=597566
Rating U.S. Federal Family Education Loan Program Student Loan ABS Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=616766
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