New legislation aimed at bringing portions of the federal government's student-loan program back under Uncle Sam's top hat is presenting a growth opportunity for the largest lenders, while smaller players may see only the exit sign.
In March, the government said it would move federal student-loan originations--a $72.7 billion business--in-house starting this summer, eliminating billions of subsidy dollars for companies that had been originating the loans on its behalf. Unable to book fees on new loans, many small lenders whose only business was federal lending see the legislation as a big blog.
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