SLM Corp., known as Sallie Mae, is expected to cut 2,500 of its 8,600 jobs, according to The Wall Street Journal.
The announced downsizing comes as a bill is signed today to overhaul the college student loan market, a Journal op-ed reported. Part of the plan is to cut private lenders from subsidized student-loan programs.
Expansions of federal Stafford and PLUS programs already helped sink Sallie Mae's private-loan business by half in 2009.
The Reston, Va.-based student lender also plans to close up to 20 of its 25 U.S. office centers.
The bill puts the Department of Education directly in charge of doling out cash to students and colleges. The op-ed suggested, likely in jest, that Sallie Mae employees look for jobs at the Department of Education.