Sallie Mae, formally known as SLM Corporation announced the completion of the company’s first asset-backed securitization as a standalone consumer banking business and the definitive agreement for its first loan sale. The company is based near Newark.
The off-balance sheet securitization consisted of approximately $380 million of Smart Option Student Loans. All securities, including the entire residual interest in the loans, were privately placed with a single, third-party investment manager.
The company has also signed a definitive agreement to sell approximately $820 million of Smart Option Student Loans to Navient Corporation. The loan sale is expected to close in August.
On April 30, Sallie Mae completed the strategic spin off of its portfolio management, loan servicing and asset recovery businesses into Navient, which will be based in Wilmington.
The company focuses exclusively on products and services that help families save, plan and pay for college. Sallie Mae has previously stated its intent to sell a portion of the loans it originates as part of its new business model.
Sallie Mae and Navient have remained under fire for collection practices and for contributing to the burden of student debt on many persons and households.
