Sallie Mae Sheds GovernmentCharter

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RESTON, Va. - (12/31/04) -- Student loan giant SLM Corp., betterknown as Sallie Mae, cut its apron strings to the federalgovernment Wednesday and completed its formal privatization duringa special ceremony at the U.S. Treasury. The company, sponsored bythe federal government in 1972 to create a secondary market forstudent loans made by banks and credit unions, has transformeditself since the 1996 plan for privatization into a full-servicestudent loan company, which includes marketing, servicing,collections, and origination of loans now in direct competitionwith its former credit union and bank customers. The company nowclaims a student loan portfolio of $100 billion and is by far theleading originator of guaranteed student loans in the country. Aspart of the company's privatization, Sallie Mae relinquished itsstate and local tax exemptions, as well as its special status as agovernment sponsored enterprise, in which credit unions werepermitted to invest. As a result, credit unions are no longerpermitted to buy securities issued by Sallie Mae.

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