NEWARK, Del. – Student loan giant Sallie Mae reported a third quarter net of $188 million, compared to a loss for the same quarter last year, as it reduced operating expenses and set aside less money to cover bad loans.
The company reported a loss of $47 million for the third quarter last year. For the first three quarters of 2012 Sallie Mae reported $589 million in net income, up from $122 million for the same period last year.
Sallie Mae said it set aside $270 million for troubled loans in the third quarter, or $139 million less than it did a year earlier.
The nation’s largest student loan provider reported a 25% increase in new loans, to $1.3 billion. Sallie Mae said it expects to make at least $3.2 billion in private education loans this year.
The unit that services federally-guaranteed student loans registered core earnings of $94 million, down from $107 million. Sallie Mae said the decrease was mainly due to lower net interest income resulting from higher funding costs and the declining balance of its holdings of U.S.-backed loans.
