SOURCE: The First Marblehead Corporation

The First Marblehead Corporation

November 19, 2009 09:15 ET

First Marblehead to Explore Strategic Alternatives for Bank Subsidiary

Union Federal Sells Its Remaining Private Education Loan Portfolio

BOSTON, MA--(Marketwire - November 19, 2009) - The First Marblehead Corporation (NYSE: FMD) today affirmed that its subsidiary, Union Federal Savings Bank, has completed the sale of its remaining private education loans held for sale. As a result of the sale of the portfolio, Union Federal no longer carries any private education loans on its balance sheet.

The loans, which had an aggregate carrying value of approximately $6.6 million as of September 30, 2009, were purchased by a newly formed trust affiliated with First Marblehead. Sale proceeds to Union Federal were approximately $3.7 million. Union Federal's equity capital following the transaction was approximately $44.4 million.

As previously announced at First Marblehead's annual meeting of stockholders, First Marblehead has begun examining strategic alternatives for Union Federal, including a potential sale.

About The First Marblehead Corporation -- First Marblehead helps meet the growing demand for private education loans by offering national and regional financial institutions and educational institutions an integrated suite of design, implementation and capital markets services for student loan programs. First Marblehead supports responsible lending and is a strong proponent of the smart borrowing principle, which encourages students to access scholarships, grants and federally guaranteed loans before considering private education loans, please see www.SmartBorrowing.org. For more information, go to www.firstmarblehead.com.

Statements in this press release regarding First Marblehead's review of strategic alternatives for Union Federal, as well as any other statements that are not purely historical, constitute forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon our plans and expectations as of November 19, 2009. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person regarding the outcome of our review of strategic alternatives for Union Federal. In particular, we cannot assure that First Marblehead's review of strategic alternatives for Union Federal will result in any specific transaction or action. Even if such a transaction or action is undertaken, we cannot provide any certainty with regard to its terms, structure, timing or ultimate completion, or as to the value that it might have for First Marblehead's stockholders. You are cautioned that matters subject to forward-looking statements involve known and unknown risks and uncertainties, including economic, legislative, regulatory, competitive and other factors, which may cause our actual results, or the timing of events, to be materially different than those expressed or implied by forward-looking statements. Important factors that could contribute to such differences include the level of interest of potential purchasers for Union Federal; our ability to negotiate acceptable terms for any potential strategic alternatives; regulatory approval of any potential strategic alternatives; and the other factors set forth under the caption "risk factors" in our quarterly report on Form 10-Q filed with the Securities and Exchange Commission on November 6, 2009.

We disclaim any obligation to update any forward-looking statements as a result of developments occurring after the date of this press release. In particular, we do not expect to update our progress with respect to strategic alternatives for Union Federal until our board of directors authorizes any transaction or unless required by applicable disclosure requirements.

Contact Information

  • Contact:

    Lee Jacobson
    Investor Relations
    First Marblehead
    800 Boylston Street, 34th FL
    Boston, MA 02199
    617.638.2065