Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Sameer Gokhale - Keefe, Bruyette & Woods.
Sameer Gokhale - Keefe, Bruyette & Woods
Just a few here; the first one is one of your competitor talked about exploring the sale of the federally guaranteed student loan portfolio. Have you also been in similar discussions perhaps with potential acquirers? Is that something you’re considering now given that you broken out and provide more details about the future cash flow stream from your portfolio or is that something still off the table at this point?
Jeff Noordhoek
Obviously, we’re going to continue to look at all the options. We’ve got a very valuable annuity stream that we financed to term. It’s not necessarily high on our priority list right now, but we will continue to look at organizational opportunities to make sure we capture the maximum value of the portfolio, as well as the maximum value of our fee based businesses.
Sameer Gokhale - Keefe, Bruyette & Woods
Is it fair to say that you haven’t reached the point, where you’re actually talking to other potential acquirers and right now you’re just exploring initially or are you further along in that process of maybe talking to some potential buyers? Could you share that with us today?
Jeff Noordhoek
No, we’re not talking to any potential buyers. At this point, we’re exploring opportunities.
Sameer Gokhale - Keefe, Bruyette & Woods
Then the other thing is on the operating expenses. I know there’s some commentary about outlook for OpEx and how they might stabilize, but let’s say the FFELP were completely eliminated. How much more in additional cost? Could you takeout of your system related to FFEL Program going forward?
Terry Heimes
Sameer, this is Terry. I mean obviously, we will pretty proactive in our approach when the legislation changed. So we’ve taken a substantial cut at our operating expenses, given the change in our business operations. We will probably be able to eliminate some additional marketing and origination cost, but I don’t think it would be substantial.
Sameer Gokhale - Keefe, Bruyette & Woods
We just looked at your revenues that you disclosed in the 10-Q from that government servicing contract, the new one that you got. If you take those revenues and you divide them by that servicing portfolio that you also received and what sort of your 20 basis points? Is that a revenue margin as a percentage of the portfolio?
- To read the full transcript on Seeking Alpha, click here »
