Citigroup shedding student loan business

NEW YORK: Citigroup says it is selling its student loan business and about $32 billion in related assets to Discover Financial Services and the student lender Sallie Mae.

The big banking company has been looking for a buyer for its 80 percent stake in the Student Loan Corp. for some time as it refocuses it operations. Citi was one of the hardest hit banks by the recession and credit crisis.

Citigroup Inc. said Friday it will take a loss of about $500 million loss on the deal.

Discover has agreed to pay $600 million for the Citi stake in the Student Loan Corp. and will also acquire $4.2 billion of private student loans.

Sallie Mae will get $28 billion of assets in the deal, adding another 1.3 million new customers.