The dramatic rise in student loan volume is a worrisome trend for policymakers, but perhaps a more troubling one for banks is a big spike in write-offs (see chart 1).

Between January and August of last year, lenders wrote off $13.6 billion in student loan debt, a 46 percent increase from the same period of 2012 and the highest amount for this period in any of the last eight years, according to the data from Equifax (See chart 2).

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