Shares of student loan lender
plunged nearly 20% Wednesday, after Chairman and CEO Albert Lord said it may have to cut its dividend amid rising loan defaults, according to published reports.
Breaking Down Sallie Mae CEO's Sailor Talk
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In a conference call intended to soothe investor fears in the wake of Sallie's guidance warning last week, Lord said the company plans to "look at the dividend in the second half of the year," as it seeks to shore up its balance sheet, according to the
Lord frustrated analysts on the call by not being more specific about the company's plans, said the
Sallie shares were trading down $5.83 to $23.04 in recent trading, a 52-week low. The stock has slumped almost 28% since Dec. 12, when Sallie said its attempt to revive a buyout deal with private equity firm J.C. Flowers
was dead and lowered its fourth-quarter and 2008 outlooks.
Student loan buyer
on Dec. 7 said it would
slash its dividend to 12 cents a share from 27.5 cents a share amid the difficult lending environment.