Sallie Mae, formally SLM Corporation, announced the creation of the SLM Student Loan EDC Repackaging Trust 2013-M1. Through this trust, Sallie Mae sold at face value $225 million of BBB-rated bonds with a 3.05-year weighted average life and a 3.5 percent coupon rate. The sale also included the entire residual interest of the trust.
The SLM Student Loan EDC Repackaging Trust 2013-M1 is collateralized by the residual interests from SLM Student Loan Trusts 2006-8, 2006-9 and 2007-1. Sallie Mae will continue to service the student loans in the underlying trusts under existing agreements. The transaction reduced student loan assets by $6.6 billion and related liabilities by $6.4 billion. The gain from the transaction will add approximately $.23 to Sallie Mae’s second-quarter 2013 GAAP and core diluted earnings per share.
More info from Sallie Mae.