RESTON, Va. – Sallie Mae, coping with the elimination of the federally guaranteed loan program, reported a first quarter net yesterday of $240.1 million, fueled by the student loan giant’s expanding presence in the market for private student loans.
The company, the largest player in the student loan market, reported a $21.1 million loss for the first quarter of 2009.
The first quarter gain was prompted in large part by a large increase in interest earned on private loans. The company reported a 46%, or $178.1 million, increase in private loan interest, to $565.2 million for the first quarter of 2010. At the same time, interest earned on guaranteed loans declined by 17% or $59.4 million.
The company said the new legislation replacing the guaranteed Federal Family Education Loan Program with direct loans from the federal government will cause it to undergo a major restructuring which will result in as many as 2,500 job losses.
