DBRS Morningstar Confirms Ratings on Goal Capital Funding Trust 2007-1, Removes One Class from Under Review with Negative Implications

DBRS, Inc. (DBRS Morningstar) confirmed the ratings on the following publicly rated securities issued by Goal Capital Funding Trust 2007-1:

-- Student Loan Asset-Backed Notes, Series 2007-1, Class A-4 FRN, confirmed at AAA (sf)
-- Student Loan Asset-Backed Notes, Series 2007-1, Class A-5 FRN, confirmed at AAA (sf)
-- Student Loan Asset-Backed Notes, Series 2007-1, Class B-1 FRN, confirmed at AA (high) (sf)

With this review, DBRS Morningstar removed the Class B-1 FRN Notes from Under Review with Negative Implications. DBRS Morningstar placed it Under Review with Negative Implications on October 20, 2020.

The rating confirmations are based on 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), available in its commentary “Global Macroeconomic Scenarios: January 2021 Update,” published on January 28, 2021. DBRS Morningstar initially published macroeconomic scenarios on April 16, 2020, which have been regularly updated. The scenarios were last updated on January 28, 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 the current ratings. The moderate scenario factors in increasing success in containment during the first half of 2021, enabling the continued relaxation of restrictions.

-- While the impact of the coronavirus pandemic has had an adverse effect on the U.S. borrower in general, DBRS Morningstar expects the performance of the underlying Federal Family Education Loan Program (FFELP) student loans in the transaction remain resilient because of the benefit from guarantees provided by eligible guarantors and reinsurance provided by the U.S. Department of Education for at least 97% of the principal and accrued interest for defaulted loans.

-- The ability of the transaction to withstand stressed cash flow assumptions and repay investors in accordance with the terms of the transaction documents.

-- Credit enhancement levels are sufficient to support the DBRS Morningstar-expected default and loss severity assumptions under various stress scenarios. Collateral performance is within expectations.

ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.

Notes:
The principal methodology is the DBRS Morningstar Master U.S. ABS Surveillance (May 27, 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 not 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.

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

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