Sallie Mae / SLM

About Sallie Mae

12061 Bluemont Way, Reston, Va. 20190
www.salliemae.com | 703-810-3000 | Founded: 1972

Industry: Financial Services | Category: Top 100 Companies

Sallie Mae agreed in April to sell itself to a group of private investors for about $25 billion. The deal awaits regulatory approval. The buyers include J.P. Morgan Chase, which is the third-largest originator of federal student loans, and Bank of America, the fourth-largest. Together with Sallie Mae, the companies control as much as 40 percent of the student loan market, analysts said.
The deal capped a year in which Sallie Mae often found itself on the defensive.
In December, the New York state attorney general began an inquiry into the company's marketing practices as they related to lists of schools' preferred lenders. Sallie Mae eventually reached a settlement in April in which it paid $2 million. It also agreed to no longer pay travel and entertainment fees for university officials, send its staff to work for free in financial aid offices or operate call centers where company employees provide financial advice but identify themselves only as university advisers.
On the political front, congressional Democrats and the Bush administration have proposed steps that could take a bite out of Sallie Mae's profits. Democrats are trying to reduce the role of such private middlemen. President Bush has proposed saving $19 billion over five years by shrinking subsidies to private lenders and raising some of their fees.
Congressional overseers and the Securities and Exchange Commission, meanwhile, have begun looking into Sallie Mae Chairman Albert L. Lord's sale of $18.3 million of company stock days before the president proposed cutting subsidies to private lenders and Sallie Mae's stock price sank. A Sallie Mae spokesman said the timing was coincidental.
In January, the Illinois attorney general sued a Sallie Mae subsidiary, alleging it had violated that state's consumer fraud law and a federal law on debt collection practices. Sallie said the subsidiary had complied with all applicable laws and regulators.
On the financial front, many borrowers refinanced Sallie Mae's loans with loans from other lenders. Of the Stafford loans in Sallie Mae's portfolio, $11.3 billion worth was refinanced with Sallie Mae last year, and $4.5 billion worth was refinanced with other lenders. Sallie Mae contended that rival lenders were exploiting a loophole to improperly grab some of its business, and the government blocked that method.
Last year, Sallie Mae acquired Upromise, which administers college savings plans.

Chairman: Albert L. Lord

President: C.E. Andrews

2007 Financial Data

Total employees: 11,456 | Local employees: 763