DBRS Morningstar Assigns Provisional Ratings to Navient Student Loan Trust 2019-4

DBRS, Inc. (DBRS Morningstar) assigned provisional ratings to the following classes of notes to be issued by Navient Student Loan Trust 2019-4 (Navient 2019-4):

-- $130,500,000 Class A-1 Notes rated AAA (sf)
-- $359,400,000 Class A-2 Notes rated AAA (sf)
-- $7,000,000 Class B Notes rated AAA (sf)

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

-- The transaction’s form and sufficiency of available credit enhancement.
-- The ability of the servicer to perform collections on the collateral pool and other required activities.
-- The provisions in the transaction documents include the transition to a new benchmark replacement rate in the event that LIBOR is discontinued. DBRS Morningstar determined that the contemplation of SOFR as a benchmark replacement rate is not a material deviation from the DBRS Morningstar methodology “Interest Rate Stresses for U.S. Structured Finance Transactions.” For more information, please see the transaction’s presale report.
-- 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 DBRS Morningstar’s “Legal Criteria for U.S. Structured Finance.”

The collateral securing Navient 2019-4 primarily consists 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 principal plus accrued interest. Navient Solutions, LLC will act as servicer for 100% of the trust student loans.

Each class of notes will bear interest based on one-month LIBOR plus a margin that will be determined at pricing and will be paid on a monthly basis beginning on the distribution date in December 2019. Principal will be paid sequentially to the Class A Notes and the Class B Notes – in that order – until each such class of notes is paid in full.

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

The principal methodology is Rating U.S. Federal Family Education Loan Program 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 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 info@dbrs.com.

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

DBRS, Inc.
140 Broadway, 43rd Floor
New York, NY 10005 USA