BOSTON, MA, Apr 08, 2008 (MARKET WIRE via COMTEX News Network) -- The First Marblehead Corporation (NYSE: FMD) today provided the
following statement from Jack Kopnisky, the company's Chief Executive
Officer and President.
"Late yesterday, The Education Resources Institute (TERI), a
non-profit guarantor of private student loans, filed a voluntary
petition for reorganization under Chapter 11 of the U.S. Bankruptcy
Code in the United States Bankruptcy Court for the District of
Massachusetts.
"The First Marblehead Corporation has been in a strategic alliance
with TERI since 2001, pursuant to which the non-profit has been the
exclusive third-party provider of borrower default guarantees for our
clients' private student loans. TERI also guarantees the loans held
by The National Collegiate Student Loan Trusts (NCSLT), the series of
trusts we use in our securitization program. According to the
filing, TERI is developing a long-term business plan so that it can
continue its College Access Programs as well as its guarantee
activities.
"First Marblehead is analyzing the implications of this filing on its
lenders, investors, borrowers, as well as the NCSLT. We are
committed to continuing to provide an integrated suite of services
including product development, processing and securitization
services. The company is working diligently on securing an
alternative guarantor as well as structural solutions for loan
default guarantees for future originations. In addition, we have
adjusted our collection and underwriting strategies to adapt to the
challenges presented by the turmoil in the capital markets and the
current consumer credit cycle."
About The First Marblehead Corporation - First Marblehead provides
financial solutions that help students achieve their dreams. The
Company helps meet the growing demand for private education loans by
providing national and regional financial institutions and educational
institutions, as well as businesses and other enterprises, with an
integrated suite of design, implementation and securitization
services for student loan programs. First Marblehead supports
responsible lending for borrowers 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. For more information, go to
www.firstmarblehead.com.
Statements in this press release regarding First Marblehead's future
services, guaranty options and alternative guarantors, 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 April 8, 2008. The inclusion of this forward-looking
information should not be regarded as a representation by us or any
other person that the future results, plans or expectations
contemplated by us will be achieved. 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 actual performance,
including future facilitated loan volumes, or the timing of events,
to be materially different than those expressed or implied by
forward-looking statements. Important factors that could cause or
contribute to such differences include: our ability to identify, and
negotiate agreements with, alternative private student loan
guarantors; our success in designing, selling and implementing
structural default guarantees for future loans; the demand for, and
market acceptance of, loan programs that are not TERI-guaranteed; our
ability to facilitate the securitization of loans that are not
TERI-guaranteed; the sufficiency of the segregated TERI loss reserve
to cover guaranty claims with respect to loans held by any of The
National Collegiate Student Loan Trusts (NCSLT); degradation of the
credit quality or performance of the loan portfolios held by NCSLT;
the effectiveness of recent underwriting and collections programs; our
relationships with key clients, including their reaction to the TERI
bankruptcy filing; the success of each of our securitization trusts
in securing its rights as a secured or an unsecured creditor of TERI;
and the other factors set forth under the caption "Item 1A. Risk
Factors" in First Marblehead's quarterly report on Form 10-Q filed
with the Securities and Exchange Commission on February 11, 2008. We
disclaim any obligation to update any forward-looking statements as a
result of developments occurring after the date of this press
release.
Contact:
Janice D. Walker
Corporate Communications
617-638-2047
Lee Jacobson
Investor Relations
617-638-2065
SOURCE: The First Marblehead Corporation