US student lender firm to bring back jobs from IndiaApril 7th, 2009 - 9:32 pm ICT by IANS
By Arun Kumar
Washington, April 7 (IANS) America’s largest private student lender Sallie Mae plans to move 2,000 overseas jobs back to the US from India and the Philippines, reversing a cost-savings measure the company took a year ago.
The jobs are projected to cost the Reston-based student lender about $35 million annually because of higher labour expenses, the Washington Post reported Tuesday.
“It’s the right thing to do,” Sallie Mae chief executive Albert L. Lord told the Post.
“The value of a company’s franchise is essentially measured in financial terms, but there are a lot of values in a company that relate to the long-term value of a franchise. It’s a wise investment in the company’s future.”
Lord said the company moved the jobs overseas about a year ago when the credit crisis was hurting Sallie Mae’s bottom line. The company cut $300 million over the past 18 months.
“It was a tough decision to move these jobs overseas,” Lord said. “It was a lot easier to make the decision to bring them back.”
Formally known as SLM Corp., Sallie Mae makes private student loans and ones backed by the federal government. The company then pools the loans into securities, which it sells to investors. Sallie Mae manages $180 billion in education loans and has 10 million student and parent customers.
That model has come under pressure in recent months, the Post said. First, the disarray in the credit markets has meant fewer investors are willing to buy the company’s securities.
Then, President Barack Obama in February proposed an end to subsidies for student loan providers such as Sallie Mae and Citigroup, with the government becoming the sole provider of federally backed college lending.
The company said it plans to fill jobs in the United States over the next 18 months. The jobs include positions in call centres, information technology and operations.
Sallie Mae employs more than 8,000 people across the US, including Florida, Indiana, Pennsylvania and Texas.
Tags: 10 million, albert l lord, arun kumar, barack obama, citigroup, credit crisis, credit markets, disarray, education loans, indi, loan providers, overseas jobs, private student loans, sallie mae, slm corp, sole provider, student loan, subsidies, washington post, wise investment