Navient, a company formed from Sallie Mae, will launch next month and take over Sallie Mae's loan management and asset recovery business.
Navient starting May 1 will provide customer service to help 12 million customers repay their education loans. Navient also will perform asset recovery services for more than 1,500 government, higher education and business clients.
Sallie Mae will continue as a consumer banking business after the separation. Sallie Mae earlier this month announced Navient's headquarters will be located in Wilmington, Delaware's riverfront district. The firm will employ an estimated 120 people.
People with loans serviced by Sallie Mae should expect to continue with the company without a change until the fall. Information on the changes will be sent in the spring in summer to consumers.
The Sallie Mae board of directors approved a dividend of Navient common stock with an April 30 distribution date to Sallie Mae common shareholders, according to the company. On April 30, Sallie Mae shareholders will "receive one share of Navient common stock for each share of Sallie Mae common stock held by them on the record date, according to the company.
Sallie Mae employs more than 7,200 people nationwide. Once the separation is completed, Sallie Maes consumer banking business will continue to trade on the NASDAQ under the ticker symbol SLM. Navient will trade as NAVI.
Sallie Mae first announced its plan to break into two in May 2013. Sallie Mae used to act as an intermediary and earned fees making student loans backed by the federal government, in addition to making private student loans. But a 2010 law consolidated the federal loan program to save costs and cut private lenders out of the process.