DBRS Assigns Provisional Ratings to North Texas Higher Education Authority, Inc. Series 2008

DBRS has today assigned provisional ratings of AAA and R-1 (high) to the Student Loan Revenue Bonds, Senior Series 2008 (the 2008 Bonds) issued by North Texas Higher Education Authority, Inc., 2008 Trust, as follows:

– $162,100,000 Senior Series 2008A (tax-exempt) at AAA and R-1 (high)
– $34,000,000 Senior Series 2008B (tax-exempt) at AAA and R-1 (high)
– $12,900,000 Senior Series 2008C (taxable) at AAA and R-1 (high)

Finalization of the ratings is contingent upon receipt of final documents conforming to information already received. The ratings are based on the ability of the transaction to pass rating agency cash flow stress scenarios and the ability of DEPFA BANK plc to honor its obligations under the letter of credit.

The 2008 Bonds are variable rate demand bonds and expected to be initially issued on August 15, 2008. Interest on the 2008 Bonds is indexed to a weekly rate, beginning on August 19, 2008, and determined on the Tuesday of each week thereafter. Interest on the tax-exempt bonds is payable on June 1 and December 1 of each year, beginning on December 1, 2008. Interest on the taxable bonds is payable on the first business day of each month, beginning on September 2, 2008. The 2008 Bonds are subject to mandatory and optional tender.

DEPFA BANK plc will provide an irrevocable, direct-pay letter of credit (LOC) to support the 2008 Bonds. The LOC will be drawn on to make payments of principal and interest on the 2008 Bonds on any regularly scheduled interest payment dates, on the stated maturity of the bonds, upon redemption, upon acceleration or upon a mandatory or optional tender of the 2008 Bonds (to the extent sufficient remarketing proceeds do not exist to pay the purchase price of such tendered 2008 Bonds).

The collateral for the 2008 Bonds consists of student loans originated under the Federal Family Education Loan Program (FFELP). All of the loans are guaranteed for up to 97% of defaulted principal and accrued interest by eligible guarantors and reinsured by the U.S. Department of Education (the ED). All of the loans in the portfolio have special allowance payment (SAP) rates based on the 91-day T-Bill rate or 90-day financial commercial paper rate.

Higher Education Servicing Corporation is identified as the servicer for all the loans in the trust and has entered into subservicing agreements with Edfinancial Services, LLC and Nelnet, Inc.

Note: All figures are in U.S. dollars unless otherwise noted.