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April 29, 2008

RI to sell bonds backed by student loans

The Rhode Island Student Loan Authority plans to sell $64 million of bonds in what would be the first U.S. municipal offering backed by student loan revenue this year, according to data compiled by Bloomberg.

The fixed-rate debt will be secured by private loans for which students will pay about 6.5 percent to 8 percent, according to Fitch Ratings. Citigroup will run the sale as soon as this week, Bloomberg data show.

The $60 million of senior bonds and $4 million of subordinate bonds received preliminary ratings of AAA and A, respectively, from Fitch and Standard & Poor’s. Proceeds of the bond sale will be used to acquire $60 million of loans through September 2009, Fitch said.

Posted by John Kostrzewa  at 8:11 AM | Permalink

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