Sallie Mae urged to keep area workers

Student loan company announced its intentions to split into two entities

By:  Andrew M. Seder

U.S. Sen. Bob Casey sent a letter to Sallie Mae’s new leader Wednesday offering his congratulations and urging CEO John Remondi to make sure the 900 Sallie Mae workers in Hanover Township will be retained as the company goes through a transformation.

A week ago, the student loan giant announced its plans to split into two publicly traded companies and named Remondi to guide the company through the change.

Though the details are still being hammered out, the general plan includes 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. Remondi will continue as its CEO.

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. Joseph DePaulo, executive vice president, banking and finance, will lead this business as its CEO.

“As you are aware, Sallie Mae’s loan servicing facility in Northeastern Pennsylvania employs approximately 900 people, and the loss of these jobs would have serious repercussions on the regional economy,” Casey, D-Scranton, wrote in his letter obtained by The Times Leader. “As you continue your work in restructuring into two separate companies, I urge you to consider this highly skilled workforce and to maintain these jobs in this region.”

Casey noted Sallie Mae has had a presence in Luzerne County for more than 25 years and he hopes the changes to the company will not alter this relationship.

“I look forward to any opportunity to work with you to keep this loan servicing facility open and to protect these jobs,” Casey wrote.

Company spokeswoman Nikki Lavoie previously noted the company expects the anticipated split “to have limited impact on our workforce size,” which stands at 7,000 companywide.