RT Journal Article
SR Electronic
T1 The Economics of Sallie Mae
JF The Journal of Structured Finance
FD Institutional Investor Journals
SP 65
OP 76
DO 10.3905/jsf.2012.18.2.065
VO 18
IS 2
A1 Tom Arnold
A1 Bonnie G. Buchanan
A1 J. Fiona Robertson
YR 2012
UL https://pm-research.com/content/18/2/65.abstract
AB The Student Loan Marketing Association, “Sallie Mae,” was formed by the federal government in 1972 to facilitate a secondary market for student loans. Now an independent entity, SLM Corporation is the largest lender and servicer of student loans in the U.S. As Sallie Mae made the transition into being a dominant player in all facets of the student loan industry (including student loan asset-backed securities, debt collection, and guarantor servicing), two economic theories have emerged. The “market for lemons” and “capture theory” theories serve as useful illustrations in understanding SLM’s evolution and future prospects.TOPICS: Financial crises and financial market history, legal and regulatory issues for structured finance