Student Loan - Loans and Debt Consolidation

SALLIE MAE TOPS WILL CUT JOBS ANALYST BLOG BENZINGA

Sallie Mae Tops, Will Cut Jobs - Analyst Blog

SLM Corporation SLM commonly known as Sallie Mae, reported first quarter core earnings of $212 million or 39 cents per share, ahead of the Zacks Consensus Estimate of 29 cents. The results compare favorably with the prior-year quarter as well, when the company incurred a loss of 3 cents per share.

Results reflected higher revenues from interest income. The company also reported a significant increase in federal loan origination.

Along with Sallie Mae, the new legislation would eliminate the role of other private lenders such as Nelnet Inc. NNI in originating federal student loans under the Federal Family Education Loan Program effective July 1, 2010.

The company is currently undergoing a significant restructuring of its operations to better align its cost structure with future revenue projections. Quarterly results were reduced by $19 million or 4 cents per share attributable to after-tax restructuring and asset impairment costs related to the legislation. The company would also reduce its workforce by 2,500 people.

Sallie Mae originated $7.7 billion in federal student loans in the reported quarter, up 16% from the prior-year period. However, the origination of private education loans decreased significantly during the quarter.

Sallie Mae originated $840 million in private education loans, compared with $1.5 billion in the prior quarter, primarily reflecting a conservative underwriting approa...[more]