Derivatives Cost Sallie Mae In FirstQuarter

RESTON, Va. - (04/24/06) – Student loan giant Sallie Maereported that losses on its derivatives portfolio hedging its hugestudent loan portfolio pushed down first quarter earnings by 32%.Net income for the quarter was $152 million, or 34 cents a share,compared to $223 million, or 49 cents a share, for the firstquarter last year. First quarter results include pretax losses of$87 million from derivatives and hedging activities, and a $44million decline in servicing and securitization revenue. Thecompany continued to expand its loan originations, once the purviewof its credit union and bank customers, originating $7.6 billion inpreferred-channel loans and $3.6 billion in internal loan brands.At the end of the first quarter the company’s student loanportfolio had grown to $127 billion, up 14% from a yearago.