Sallie Mae—formerly SLM Corp.—announced on Thursday the completion of its separation into two companies: a consumer banking unit for education lending and a loan servicing and collection firm.
“With a 40-year foundation of experience, today Sallie Mae begins anew as a bank that emphasizes responsible consumer financial practices to benefit our customers,” Sallie Mae CEO Raymond Quinlan said. “The new Sallie Mae is squarely oriented toward meeting our customers’ needs and building long-term relationships. Our leadership includes a mix of tenured education lending and banking talent who share my vision for growing the franchise.”
With the separation Sallie Mae now manages a portfolio of approximately $6.5 billion in private education loans, which are offered by the company, along with insurance options and savings products for families seeking to invest in higher education.
Customers who have loans serviced by Sallie Mae will see no changes until the fall. Sallie Mae will send out personalized information about customer accounts and advance notice of any changes needed to manage their accounts.
The second arm of the company—Navient, the loan servicing and collections company—is expected to service 12 million customers and nearly $300 billion in student loans.
“Helping our customers navigate the path to financial success is everything we stand for,” Jack Remondi, the president and CEO of the former SLM Corp. who will serve as the arm’s new CEO, said. “Our new name —Navient—symbolizes the expertise, experience, and dedication we consistently deliver for our clients and customers.”