DBRS Morningstar Finalizes Provisional Ratings on Navient Private Education Loan Trust 2020-I

DBRS, Inc. (DBRS Morningstar) finalized its provisional ratings on the following classes of notes issued by Navient Private Education Loan Trust 2020-I (Navient 2020-I):

-- $252,000,000 Fixed Rate Class A-1A Notes rated AAA (sf)
-- $300,000,000 Floating Rate Class A-1B Notes rated AAA (sf)
-- $52,000,000 Fixed Rate Class B Notes rated AA (sf)

The ratings are based on a review by DBRS Morningstar of the following analytical considerations:
-- The transaction’s assumptions consider DBRS Morningstar’s set of macroeconomic scenarios for select economies related to the Coronavirus Disease (COVID-19), available in its commentary “Global Macroeconomic Scenarios: December Update,” published on December 2, 2020. DBRS Morningstar initially published macroeconomic scenarios on April 16, 2020, which have been regularly updated. The scenarios were last updated on December 2, 2020, 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 increasing success in containment during the first half of 2021, enabling the continued relaxation of restrictions.
-- Transaction capital structure and form and sufficiency of available credit enhancement.
-- The ability of the transaction to withstand stressed cash flow assumptions and repay investors in accordance with the terms of the Navient 2020-I transaction documents.
-- The sequential-pay structure.
-- Structural features of the transaction that require the Class A Notes to enter into full turbo principal amortization under certain circumstances.
-- The quality and credit characteristics of the student loans and underlying borrowers.
-- The ability of Navient Solutions, LLC, as the servicer, to perform collections on the collateral pool and other required activities.
-- The legal structure and presence of legal opinions that address the true sale of the student loans, the nonconsolidation of the trust and that the trust has a valid first-priority security interest in the assets, and the consistency with DBRS Morningstar’s “Legal Criteria for U.S. Structured Finance.”

The trust consists of seasoned private student loans that were made and underwritten under various loan programs administered by the former Sallie Mae, Inc.

ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework and its methodologies can be found at: https://www.dbrsmorningstar.com/research/357792.

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

The principal methodology is Rating U.S. Private Student Loan Securitizations (November 5, 2020), which can be found on dbrsmorningstar.com under Methodologies & Criteria.

For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883.

For more information regarding structured finance rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/358308.

For more information regarding the structured finance rating approach and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/359905.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar 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 [email protected].

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at [email protected].

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