DBRS Morningstar Assigns Provisional Ratings to North Texas Higher Education Authority, Inc. Series 2021-1.

ENPNewswire-August 30, 2021--DBRS Morningstar Assigns Provisional Ratings to North Texas Higher Education Authority, Inc. Series 2021-1

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Release date- 27082021 - DBRS, Inc. (DBRS Morningstar) assigned provisional ratings to the following series of notes to be issued by North Texas Higher Education Authority, Inc. Series 2021-1 (NTHEA 2021-1).

Up to $118,000,000 Class A-1A Notes rated AAA (sf)*

Up to $418,000,000 Class A-1B Notes rated AAA (sf)*

$10,000,000 Class B Notes rated A (sf)

*The minimum principal amount of the Class A-1A Notes that will be issued will be $50,000,000 and the maximum principal amount of the Class A-1A Notes that will be issued will be $118,000,000. The Class A Notes will be issued in an amount of $468,000,000.

The provisional ratings are based on DBRS Morningstar's review of the following analytical considerations:

The transaction assumptions consider DBRS Morningstar's set of macroeconomic scenarios for select economies related to the Coronavirus Disease (COVID-19) pandemic, available in its commentary 'Global Macroeconomic Scenarios: June 2021 Update,' published on June 18, 2021. DBRS Morningstar initially published macroeconomic scenarios on April 16, 2020, which have been regularly updated. The scenarios were last updated on June 18, 2021, and are reflected in DBRS Morningstar's rating analysis.

The assumptions consider the moderate macroeconomic scenario outlined in the commentary, with the moderate scenario serving as the primary anchor for current ratings. The moderate scenario factors in continued success in containment during the second half of 2021, enabling the continued relaxation of restrictions.

The transaction's form and sufficiency of available credit enhancement.

The ability of the subservicers to perform collections on the collateral pool and other required activities.

The provisions in the transaction documents anticipate the transition to a new replacement index upon the discontinuation of LIBOR.

The legal structure and expected legal opinions.

The collateral securing NTHEA 2021-1 will consist of student loans originated pursuant to the Federal Family Education Loan Program, which are ultimately guaranteed by the U.S. Department of Education for at least 97% of defaulted principal plus accrued interest. Higher Education Servicing Corporation will act as master servicer and Higher Education Servicing Corporation; Nelnet Servicing, LLC; Edfinancial...

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