Moody's may lower SLM

Moody's Investors Service said it is continuing its ratings review for possible downgrade of SLM Corp., pending completion of the company's $31 billion 364-day asset-backed credit facility from a consortium of banks including Bank of America, JP Morgan Chase, Barclays Capital and Deutsche Bank.

During its review, Moody's said that it continues to focus on a variety of factors, including SLM's liquidity position, earnings profile and ability to achieve acceptable returns in its core student lending business.

Commitments for SLM's new financing facility were announced by the firm this morning and the company also announced that, as part of this new financing arrangement, the lawsuit filed by SLM related to the proposed merger of the company, as well as all counterclaims, will be dismissed and the merger agreement has been terminated, the agency said.

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