DBRS Assigns Provisional Ratings to Laurel Road Prime Student Loan Trust 2019-A

DBRS, Inc. (DBRS) assigned provisional ratings to the classes of notes (collectively, the Notes) to be issued by Laurel Road Prime Student Loan Trust 2019-A (LRK 2019-A) as listed below:

-- $75,824,000 Class A-1FX Notes at AAA (sf)
-- $145,000,000 Class A-2FX Notes at AAA (sf)
-- $15,507,000 Class B-FX Notes at AA (sf)

LRK 2019-A represents the first student loan refinancing asset-backed security transaction sponsored and administered by KeyBank National Association (KeyBank). On April 3, 2019, KeyBank completed the acquisition of Laurel Road Bank’s digital lending business and online lending platform.

The provisional ratings are based on a review by DBRS of the following analytical considerations:

-- The transaction’s capital structure and the form and sufficiency of available credit enhancement.
-- The quality and credit characteristics of the student loan borrowers.
-- Structural features of the transaction that require the Class A-1FX and A-2FX Notes (together, the Class A Notes) to enter into full turbo principal amortization if certain performance triggers are breached or if credit enhancement deteriorates.
-- Laurel Road’s capabilities with regard to originations and underwriting.
-- The ability of the Higher Education Loan Authority of the State of Missouri to perform collections on the collateral pool and other required activities.
-- The legal structure and expected legal opinions that will address the true sale of the student loans, the non-consolidation of the trust, that the trust has a valid first-priority security interest in the assets and the consistency with the DBRS “Legal Criteria for U.S. Structured Finance.”

The Notes will be backed by fixed-rate loans originated through Laurel Road’s student loan refinancing program.

Credit enhancement for LRK 2019-A will consist of overcollateralization, subordination provided by the Class B Notes for the benefit of the Class A Notes, a reserve account for the Class A Notes, a liquidity account for the Class B Notes and excess spread.

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

The principal methodology is Rating U.S. Private Student Loan Securitizations, which can be found on dbrs.com under Methodologies & Criteria.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

The full report providing additional analytical detail is available by clicking on the link under Related Documents below or by contacting us at info@dbrs.com.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.

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