Sallie Mae President/CEO Jack Remondi responded to Sen. Elizabeth Warren's criticism of the student lender's use of a Federal Home Loan Bank line of credit, which she said earlier this week was used to fund private student loans and earn a large profit.
The Masschusetts Democrat questioned use of FHLB funds in a June 24 letter to Federal Housing Finance Administration Acting Director Edward DeMarco, and brought up the topic again during a Senate Banking Committee hearing on private student loans Tuesday.
"It is deeply worrisome that the Federal Home Loan Banks may be undermining their mission by extending billions of dollars in cheap credit to private student lenders," Warren said.
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