Dec 6 Sallie Mae Corp, the largest U.S.
student loan provider, filed regulatory documents on Friday that
will enable it to split into two companies, a move it first
announced in May to try to win better stock market valuation for
its private student-lending business.
Sallie Mae plans to split the company into one business made
of federally guaranteed and private student loans and the
servicing and collections activites around those loans. The
second business will include its consumer banking business and
private education-lending business.
The regulatory filing, a registration statement for the
still unnamed new company, said that one SLM share would
translate into one share in each of the two companies after the
The new loan company will hold the largest portfolio of
education loans through the Federal Family Education Loan
Program under which private lenders make student loans backed by
According to the documents, the new company's assets include
$105 billion of these FFELP loans, $32 billion in private
education loans and $7.8 billion in other interest-earnings
assets. It also services 10 million federal loan customers.
In an emailed statement, Sallie Mae spokeswoman Patricia
Nash Christel said the company expects to complete the spin-off
by the end of the second quarter of 2014.