The ratings on Vermont Student Assistance Corp.'s (VSAC) education loan revenue bonds series 2002 are based on an unconditional, irrevocable municipal bond insurance policy that guarantees payment of scheduled principal and interest provided by Ambac Assurance Corp. (Ambac; 'AAA' financial strength rating). Although the ratings are dependent on Standard & Poor's rating of Ambac's insurer financial strength, the underlying transaction is of investment-grade quality, as illustrated by the following: Structural features that restrict proprietary and alternative loan originations, and limit recycling and the withdrawal of funds; Issuer's excellent servicing history, with minimal claims rejected for improper servicing since 1982; Bankruptcy-remote municipal issuer; and VSAC's excellent performance as a guarantor (VSAC is a lender, servicer, and guarantor of student loans). The
