HANOVER TWP. — The 1,100 employees at the Hanover Industrial Estates processing center who currently answer their phones “Thank you for calling Sallie Mae” will be greeting callers using a new company name by the end of the year.
The student loan giant announced today that it will begin using the name Navient later this year. The new name comes about after Sallie Mae decided to split its business into two unique, publicly traded companies.
While Sallie Mae will remain the name of the company’s consumer banking business, Navient, the soon-to-launch company that will handle loan management, servicing and asset recovery company to be launched, will be the name of the local operations center in Hanover Township
Jack Remondi, president and CEO of Sallie Mae, announced the name and new logo to employees this morning at the company’s headquarters in Delaware.
“Our new name — Navient — symbolizes the expertise, experience, and dedication we consistently deliver for our clients and customers,” Remondi said in a release. “Helping our customers navigate the path to financial success is everything we stand for.”
Remondi will serve as Navient’s CEO.
Raymond J. Quinlan will serve as executive chairman of the Board and will lead the banking business that will keep the Sallie Mae name as its CEO.
The strategic plan created by the company last year calls for the creation of two companies, each initially owned by Sallie Mae’s existing shareholders. Sallie Mae would form an education loan management business composed of the company’s portfolios of federally guaranteed (FFELP) and private education loans, as well as most related servicing and collection activities. This will be Navient.
Sallie Mae’s private education loan origination and servicing businesses, including Sallie Mae Bank, the Sallie Mae Upromise Rewards program and the private education loans it currently holds, will operate separately under the Sallie Mae brand. This will be a consumer education lending franchise with expertise in helping families save, plan and pay for college.
Upon completion of the transaction, Navient is expected to service nearly $300 billion in student loans, providing customer support to assist 12 million customers in paying their education loans. Navient also will continue to perform asset recovery for government, higher education and business clients, as well as manage a portfolio of FFELP and private loans.
With more than 6,000 employees and more than $2 billion in revenue, Navient will trade on the NASDAQ stock exchange under the ticker symbol NAVI. Navient corporate headquarters will be located in Newark, Del., with centers in Fishers, Indianapolis, and Muncie, Ind.; Newark, Del.; Newton, Mass.; Reston, Va.; Washington, D.C.; and Hanover Township. The company’s asset recovery subsidiaries Pioneer Credit Recovery and General Revenue Corporation operate in Arcade, Perry and Horseheads, N.Y.; Lake City, Fla.; Mason, Ohio; and Moorestown, N.J.
The Navient name “won’t be used until the spin-off occurs by the end of the second quarter, and it won’t be used by customers until the fourth quarter when servicing operations are expected to begin under the new name,” said Sallie Mae spokeswoman Nikki Lavoie.
After the separation, the company’s consumer banking business will retain the Sallie Mae name and will continue to trade on the NASDAQ stock exchange under the ticker symbol SLM. Sallie Mae will continue to help families save, plan and pay for college through responsible private education loan, insurance and savings products.
Customers with student loans serviced by Sallie Mae will continue to conduct business as they do today, with no changes until the fall of 2014. This spring and summer, they will receive personalized information about their account and any changes needed to ensure a smooth transition, according to Lavoie.
Sallie Mae, formerly known as SLM Corp., started its operations locally in 1987 at the former Faith Shoe factory on Beekman Street in South Wilkes-Barre. The Wilkes-Barre employees relocated to a newly built center in the Hanover Industrial Estates in 1990.
As the company has grown, it’s also changed from an entity processing government-originated loans to one that now originates its own private loans. SLM Corp. is a publicly held, private-sector corporation, governed by a board elected by shareholders. The company began privatizing its operations in 1997 and completed that change by the end of 2004.
In 2009, Sallie Mae began to service federal loans on behalf of the U.S. Department of Education. After the federal government ended the Federal Family Education Loan Program in 2010, it eliminated subsidies paid to private lenders and banks that originated loans for college students in 2010.