SLM Corp., the student loan provider being taken over in a leveraged buyout, announced that its Chief Executive Thomas Fitzpatrick had resigned and would be replaced by C.E. Andrews, the company’s chief financial officer, Reuters reports.
Fitzpatrick’s departure comes as SLM, the largest student loan provider, seeks to overhaul its image amid a scandal over lending practices in the $85-billion-a-year student loan industry.
Regulators and legislators are increasingly questioning the extent to which lenders are using kickbacks to universities and gifts to financial aid officers to win business.
A source familiar with SLM, known popularly as Sallie Mae, said: “The board and investors decided that Sallie Mae needs to lead efforts to reform student lending, and a new team was needed to lead that change.”