In contrastto industry perception that delinquency rates for student loans are rising, continues to see improvingcredit performance trends among its customers, according to President and CEO JohnRemondi.
"Whilethe rhetoric implies student loan delinquencies and defaults are rising, I'm happyto report our customers are continuing to experience very different and positivetrends," Remondi said on an earningscall.
Provisionfor loan losses in the private education loans segment fell year over year to $100million in the second quarter from $191 million as private loan charge-off rateshave fallen to the "lowest levels since before the financial crisis,"he said.
Navientexecuted three ABS deals backed by Federal Family Education Loan Program loans duringthe quarter for $1.8 billion, including a securitization made entirely of rehabilitatedFFELP loans. Investor appetite for these transactions is improving and funding spreadsare narrowing, Remondi said.
Ratingagencies are making changes to cash flow assumptions for various securitizationsbacked by FFELP loans. Moody's has put under review more than $56 billion of Navientor Navient-sponsored ABS deals, while the figure for bonds under review by Fitchis approximately $52 billion, executives said.