##### 



Exhibit 99.2




---



##### 



Collegiate Funding Services, Inc.
 Consolidated Balance Sheets
(dollars in thousands)
(unaudited except for December 31, 2004)
 Mar. 31, 2005
    
    
    Jun. 30, 2005
    
    
    Sep. 30, 2005
    
    
    Dec. 31, 2005
    
    
    Mar. 31, 2004
    
    
    Jun. 30, 2004
    
    
    Sep. 30, 2004
    
    
    Dec. 31, 2004AssetsCash and cash equivalents
    
    $
    23,980
    
    
    $
    14,242
    
    
    $
    17,982
    
    
    $
    
    
    
    $
    14,855
    
    
    $
    7,779
    
    
    $
    2,409
    
    
    $
    12,925Restricted cash
    
    
    156,427
    
    
    
    128,087
    
    
    
    84,408
    
    
    
    
    
    
    
    79,371
    
    
    
    144,086
    
    
    
    104,271
    
    
    
    80,128Accounts receivable, net
    
    
    7,239
    
    
    
    9,560
    
    
    
    15,784
    
    
    
    
    
    
    
    3,908
    
    
    
    3,225
    
    
    
    17,043
    
    
    
    10,353Student loans, net of allowance
    
    
    5,111,559
    
    
    
    5,412,749
    
    
    
    5,642,706
    
    
    
    
    
    
    
    3,449,045
    
    
    
    3,735,516
    
    
    
    4,075,050
    
    
    
    4,659,842Accrued interest receivable
    
    
    52,234
    
    
    
    61,710
    
    
    
    72,357
    
    
    
    
    
    
    
    22,166
    
    
    
    26,369
    
    
    
    32,932
    
    
    
    42,844Income taxes receivable
    
    
    1,078
    
    
    
    1,525
    
    
    
    1,208
    
    
    
    
    
    
    
    7,694
    
    
    
    7,694
    
    
    
    6,948
    
    
    
    6,588Property and equipment, net
    
    
    13,707
    
    
    
    14,223
    
    
    
    13,731
    
    
    
    
    
    
    
    12,676
    
    
    
    12,507
    
    
    
    13,649
    
    
    
    14,622Goodwill
    
    
    188,729
    
    
    
    192,260
    
    
    
    192,983
    
    
    
    
    
    
    
    160,705
    
    
    
    193,084
    
    
    
    189,309
    
    
    
    188,729Deferred financing costs, net
    
    
    20,225
    
    
    
    19,644
    
    
    
    19,699
    
    
    
    
    
    
    
    12,033
    
    
    
    16,410
    
    
    
    16,160
    
    
    
    15,560Other assets
    
    
    11,614
    
    
    
    12,152
    
    
    
    11,466
    
    
    
    
    
    
    
    3,030
    
    
    
    13,399
    
    
    
    13,136
    
    
    
    11,200Total assets
    
    $
    5,586,792
    
    
    $
    5,866,152
    
    
    $
    6,072,324
    
    
    $
    
    
    
    $
    3,765,483
    
    
    $
    4,160,069
    
    
    $
    4,470,907
    
    
    $
    5,042,791Liabilities, preferred stock of
consolidated subsidiary and stockholders
equityLiabilitiesAsset-backed notes and lines of credit
    
    $
    5,313,877
    
    
    $
    5,586,741
    
    
    $
    5,768,690
    
    
    $
    
    
    
    $
    3,574,180
    
    
    $
    3,926,972
    
    
    $
    4,224,265
    
    
    $
    4,782,670Other debt obligations, net
    
    
    14,538
    
    
    
    14,589
    
    
    
    14,641
    
    
    
    
    
    
    
    36,832
    
    
    
    68,884
    
    
    
    26,826
    
    
    
    14,486Capital lease obligations
    
    
    1,629
    
    
    
    1,507
    
    
    
    1,383
    
    
    
    
    
    
    
    1,829
    
    
    
    1,691
    
    
    
    1,867
    
    
    
    1,749Accounts payable
    
    
    4,145
    
    
    
    2,756
    
    
    
    1,815
    
    
    
    
    
    
    
    1,871
    
    
    
    3,416
    
    
    
    4,433
    
    
    
    2,315Accrued interest payable
    
    
    9,015
    
    
    
    5,220
    
    
    
    5,373
    
    
    
    
    
    
    
    1,996
    
    
    
    3,843
    
    
    
    2,429
    
    
    
    5,116Other accrued liabilities
    
    
    22,862
    
    
    
    26,992
    
    
    
    40,145
    
    
    
    
    
    
    
    18,097
    
    
    
    15,805
    
    
    
    22,379
    
    
    
    26,074Deferred income taxes, net
    
    
    20,655
    
    
    
    21,067
    
    
    
    22,789
    
    
    
    
    
    
    
    12,859
    
    
    
    17,378
    
    
    
    15,204
    
    
    
    18,669Total liabilities
    
    
    5,386,721
    
    
    
    5,658,872
    
    
    
    5,854,836
    
    
    
    
    
    
    
    3,647,664
    
    
    
    4,037,989
    
    
    
    4,297,403
    
    
    
    4,851,079Preferred stock of consolidated subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    91,252
    
    
    
    93,444Stockholders equityCommon stock
    
    
    31
    
    
    
    32
    
    
    
    32
    
    
    
    
    
    
    
    21
    
    
    
    21
    
    
    
    30
    
    
    
    30Notes receivable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (328
    )
    
    
    (328
    )Additional paid-in capital
    
    
    158,312
    
    
    
    158,939
    
    
    
    159,863
    
    
    
    
    
    
    
    20,453
    
    
    
    20,458
    
    
    
    157,345
    
    
    
    157,823Retained earnings
    
    
    41,728
    
    
    
    48,309
    
    
    
    57,593
    
    
    
    
    
    
    
    6,421
    
    
    
    8,485
    
    
    
    16,129
    
    
    
    33,859Total stockholders equity
    
    
    200,071
    
    
    
    207,280
    
    
    
    217,488
    
    
    
    
    
    
    
    26,567
    
    
    
    28,636
    
    
    
    173,504
    
    
    
    191,712Total liabilities, preferred stock of
consolidated subsidiary and stockholders
equity
    
    $
    5,586,792
    
    
    $
    5,866,152
    
    
    $
    6,072,324
    
    
    $
    
    
    
    $
    3,765,483
    
    
    $
    4,160,069
    
    
    $
    4,470,907
    
    
    $
    5,042,791




---



##### 



Collegiate Funding Services, Inc.
 Consolidated Statements of Income
(dollars in thousands, except per share amounts)
(unaudited except for year-to-date 2004)
 Quarter Ended
    
    
    
    
    
    
    Quarter EndedMar. 31,
    
    
    Jun. 30,
    
    
    Sep. 30,
    
    
    Dec. 31,
    
    
    Year-
    
    
    Mar. 31,
    
    
    Jun. 30,
    
    
    Sep. 30,
    
    
    Dec. 31,
    
    
    Year-2005
    
    
    2005
    
    
    2005
    
    
    2005
    
    
    to-Date
    
    
    2004
    
    
    2004
    
    
    2004
    
    
    2004
    
    
    to-DateNet RevenueInterest income
    
    $
    54,074
    
    
    $
    63,808
    
    
    $
    74,454
    
    
    $
    
    
    
    $
    192,336
    
    
    $
    26,864
    
    
    $
    31,194
    
    
    $
    36,738
    
    
    $
    44,721
    
    
    $
    139,517Interest expense
    
    
    37,114
    
    
    
    46,743
    
    
    
    55,630
    
    
    
    
    
    
    
    139,487
    
    
    
    13,078
    
    
    
    15,518
    
    
    
    20,242
    
    
    
    27,773
    
    
    
    76,611Net interest income
    
    
    16,960
    
    
    
    17,065
    
    
    
    18,824
    
    
    
    
    
    
    
    52,849
    
    
    
    13,786
    
    
    
    15,676
    
    
    
    16,496
    
    
    
    16,948
    
    
    
    62,906Provision for (reversal of) loan losses
    
    
    583
    
    
    
    2,205
    
    
    
    1,451
    
    
    
    
    
    
    
    4,239
    
    
    
    927
    
    
    
    (1,467
    )
    
    
    726
    
    
    
    769
    
    
    
    955Net interest income after provision for (reversal of) loan losses
    
    
    16,377
    
    
    
    14,860
    
    
    
    17,373
    
    
    
    
    
    
    
    48,610
    
    
    
    12,859
    
    
    
    17,143
    
    
    
    15,770
    
    
    
    16,179
    
    
    
    61,951Fee income
    
    
    30,626
    
    
    
    38,747
    
    
    
    44,354
    
    
    
    
    
    
    
    113,727
    
    
    
    21,773
    
    
    
    20,976
    
    
    
    43,310
    
    
    
    50,376
    
    
    
    136,435Net revenue
    
    
    47,003
    
    
    
    53,607
    
    
    
    61,727
    
    
    
    
    
    
    
    162,337
    
    
    
    34,632
    
    
    
    38,119
    
    
    
    59,080
    
    
    
    66,555
    
    
    
    198,386ExpensesSalaries and related benefits
    
    
    16,011
    
    
    
    17,269
    
    
    
    18,395
    
    
    
    
    
    
    
    51,675
    
    
    
    13,981
    
    
    
    16,172
    
    
    
    17,423
    
    
    
    16,390
    
    
    
    63,966Other selling, general and administrative expenses:Marketing and mailing costs
    
    
    10,560
    
    
    
    14,126
    
    
    
    15,635
    
    
    
    
    
    
    
    40,321
    
    
    
    6,425
    
    
    
    10,887
    
    
    
    17,501
    
    
    
    11,646
    
    
    
    46,459Communications and data processing
    
    
    1,931
    
    
    
    2,115
    
    
    
    2,002
    
    
    
    
    
    
    
    6,048
    
    
    
    1,708
    
    
    
    1,799
    
    
    
    2,274
    
    
    
    2,271
    
    
    
    8,052Management and consulting fees
    
    
    600
    
    
    
    360
    
    
    
    313
    
    
    
    
    
    
    
    1,273
    
    
    
    938
    
    
    
    799
    
    
    
    600
    
    
    
    600
    
    
    
    2,937Professional fees
    
    
    1,673
    
    
    
    2,155
    
    
    
    2,450
    
    
    
    
    
    
    
    6,278
    
    
    
    1,055
    
    
    
    1,374
    
    
    
    1,637
    
    
    
    2,034
    
    
    
    6,100Depreciation and amortization
    
    
    1,829
    
    
    
    1,916
    
    
    
    2,051
    
    
    
    
    
    
    
    5,796
    
    
    
    1,250
    
    
    
    1,347
    
    
    
    1,702
    
    
    
    1,715
    
    
    
    6,014Other general and administrative
    
    
    2,739
    
    
    
    4,296
    
    
    
    1,641
    
    
    
    
    
    
    
    8,676
    
    
    
    2,409
    
    
    
    2,645
    
    
    
    3,499
    
    
    
    2,919
    
    
    
    11,472Total selling, general and administrative expenses
    
    
    19,332
    
    
    
    24,968
    
    
    
    24,092
    
    
    
    
    
    
    
    68,392
    
    
    
    13,785
    
    
    
    18,851
    
    
    
    27,213
    
    
    
    21,185
    
    
    
    81,034Swap interest (income) expense
    
    
    (1,121
    )
    
    
    (290
    )
    
    
    (316
    )
    
    
    
    
    
    
    (1,727
    )
    
    
    1,582
    
    
    
    2,023
    
    
    
    643
    
    
    
    (874
    )
    
    
    3,374Derivative and investment mark-to-market (income) expense
    
    
    (306
    )
    
    
    819
    
    
    
    (7
    )
    
    
    
    
    
    
    506
    
    
    
    (226
    )
    
    
    (5,888
    )
    
    
    245
    
    
    
    422
    
    
    
    (5,447
    )Debt extinguishment
    
    
    
    
    
    
    


    
    
    4,329
    
    
    
    
    
    
    
    4,329Total expenses
    
    
    33,916
    
    
    
    42,766
    
    
    
    46,493
    
    
    
    
    
    
    
    123,175
    
    
    
    29,122
    
    
    
    31,158
    
    
    
    45,524
    
    
    
    37,123
    
    
    
    142,927Income before income tax provision and accretion of dividends
on preferred stock
    
    
    13,087
    
    
    
    10,841
    
    
    
    15,234
    
    
    
    
    
    
    
    39,162
    
    
    
    5,510
    
    
    
    6,961
    
    
    
    13,556
    
    
    
    29,432
    
    
    
    55,459Income tax provision
    
    
    5,218
    
    
    
    4,260
    
    
    
    5,950
    
    
    
    
    
    
    
    15,428
    
    
    
    2,204
    
    
    
    2,705
    
    
    
    5,405
    
    
    
    11,702
    
    
    
    22,016Income before accretion of dividends
    
    
    7,869
    
    
    
    6,581
    
    
    
    9,284
    
    
    
    
    
    
    
    23,734
    
    
    
    3,306
    
    
    
    4,256
    
    
    
    8,151
    
    
    
    17,730
    
    
    
    33,443Accretion of dividends on preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,116
    
    
    
    2,192
    
    
    
    507

    

    
    
    
    
    

    
    4,815Net income
    
    $
    7,869
    
    
    $
    6,581
    
    
    $
    9,284
    
    
    $
    
    
    
    $
    23,734
    
    
    $
    1,190
    
    
    $
    2,064
    
    
    $
    7,644
    
    
    $
    17,730
    
    
    $
    28,628Weighted average common shares outstanding, diluted
    
    
    32,379,960
    
    
    
    32,413,322
    
    
    
    32,235,057
    
    
    
    
    
    
    
    32,237,631
    
    
    
    22,912,108
    
    
    
    22,925,616
    
    
    
    30,710,055
    
    
    
    32,351,370
    
    
    
    27,254,317Earnings per common share, diluted
    
    $
    0.24
    
    
    $
    0.20
    
    
    $
    0.29
    
    
    
    
    
    
    $
    0.74
    
    
    $
    0.05
    
    
    $
    0.09
    
    
    $
    0.25
    
    
    $
    0.55
    
    
    $
    1.05




---



##### 



Quarter EndedMarch 31, 2005
    
    
    June 30, 2005
    
    
    September 30, 2005
    
    
    December 31, 2005
    
    
    Year-to-date 2005(dollars in thousands)
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    AverageInterest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    RatesAverage
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    PaidInterest-earning assets:Cash and cash equivalents
    
    $
    20,762
    
    
    $
    330
    
    
    
    6.45
    %
    
    $
    18,218
    
    
    $
    346
    
    
    
    7.62
    %
    
    $
    17,600
    
    
    $
    336
    
    
    
    7.57
    %
    
    $
    
    
    
    $
    
    
    
    
    
    %
    
    $
    18,809
    
    
    $
    1,012
    
    
    
    7.19
    %Restricted cash
    
    
    139,503
    
    
    
    905
    
    
    
    2.63
    
    
    
    178,645
    
    
    
    1,455
    
    
    
    3.27
    
    
    
    146,364
    
    
    
    1,523
    
    
    
    4.13
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    157,353
    
    
    
    3,883
    
    
    
    3.30Student loans
    
    
    4,881,930
    
    
    
    68,152
    
    
    
    5.66
    
    
    
    5,264,156
    
    
    
    78,605
    
    
    
    5.99
    
    
    
    5,551,425
    
    
    
    89,771
    
    
    
    6.42
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,225,329
    
    
    
    236,528
    
    
    
    6.05Borrower benefits
    
    
    
    
    
    
    (1,077
    )
    
    
    (0.09
    )
    
    
    
    
    
    
    (1,185
    )
    
    
    (0.09
    )
    
    
    
    
    
    
    (1,209
    )
    
    
    (0.09
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,471
    )
    
    
    (0.09
    )Department of Education rebate (1)
    
    
    
    
    
    
    (12,904
    )
    
    
    (1.07
    )
    
    
    
    
    
    
    (13,827
    )
    
    
    (1.05
    )
    
    
    
    
    
    
    (14,484
    )
    
    
    (1.04
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (41,215
    )
    
    
    (1.05
    )Amortization (2)
    
    
    
    
    
    
    (1,332
    )
    
    
    (0.11
    )
    
    
    
    
    
    
    (1,586
    )
    
    
    (0.12
    )
    
    
    
    
    
    
    (1,483
    )
    
    
    (0.11
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,401
    )
    
    
    (0.11
    )Student loans, net of borrower benefits,
Department of Education rebate and
amortization
    
    
    4,881,930
    
    
    
    52,839
    
    
    
    4.39
    
    
    
    5,264,156
    
    
    
    62,007
    
    
    
    4.73
    
    
    
    5,551,425
    
    
    
    72,595
    
    
    
    5.18
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,225,329
    
    
    
    187,441
    
    
    
    4.80Total interest-earning assets
    
    $
    5,042,195
    
    
    $
    54,074
    
    
    
    4.35
    %
    
    $
    5,461,019
    
    
    $
    63,808
    
    
    
    4.69
    %
    
    $
    5,715,389
    
    
    $
    74,454
    
    
    
    5.17
    %
    
    $
    
    
    
    $
    
    
    
    
    
    %
    
    $
    5,401,491
    
    
    $
    192,336
    
    
    
    4.76
    %Interest-bearing
liabalities:Asset-backed notes and lines of credit
    
    $
    5,055,096
    
    
    $
    36,649
    
    
    
    2.94
    %
    
    $
    5,471,068
    
    
    $
    46,279
    
    
    
    3.39
    %
    
    $
    5,720,728
    
    
    $
    55,315
    
    
    
    3.84
    %
    
    $
    
    
    
    $
    
    
    
    
    
    %
    
    $
    5,408,695
    
    
    $
    138,243
    
    
    
    3.42
    %Other debt obligations, net
    
    
    14,512
    
    
    
    436
    
    
    
    12.18
    
    
    
    14,564
    
    
    
    437
    
    
    
    12.04
    
    
    
    14,615
    
    
    
    291
    
    
    
    7.90
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,564
    
    
    
    1,164
    
    
    
    10.69Capital lease obligations
    
    
    1,689
    
    
    
    29
    
    
    
    6.96
    
    
    
    1,568
    
    
    
    27
    
    
    
    6.91
    
    
    
    1,445
    
    
    
    24
    
    
    
    6.59
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,567
    
    
    
    80
    
    
    
    6.83Total interest-bearing liabilities
    
    $
    5,071,297
    
    
    $
    37,114
    
    
    
    2.97
    %
    
    $
    5,487,200
    
    
    $
    46,743
    
    
    
    3.42
    %
    
    $
    5,736,788
    
    
    $
    55,630
    
    
    
    3.85
    %
    
    $
    
    
    
    $
    
    
    
    
    %
    
    
    $
    5,424,826
    
    
    $
    139,487
    
    
    
    3.44
    %Net Interest income and margin
    
    
    
    
    
    $
    16,960
    
    
    
    1.36
    %(3)
    
    
    
    
    
    $
    17,065
    
    
    
    1.26
    %(3)
    
    
    
    
    
    $
    18,824
    
    
    
    1.31
    %
    
    
    
    
    
    $
    
    
    
    
    
    %
    
    
    
    
    
    $
    52,849
    
    
    
    1.31
    %(3)
 
 (1)
    
    Reflects the 1.05% per annum rebate fee on FFELP consolidation loans that is paid monthly divided by the average balance of student loans.(2)
    
    Represents the amortization of capitalized origination costs, deferred revenue and purchase accounting adjustments, including the 0.50%
fee payable to the Department of Education on the origination of FFELP loans.(3)
    
    Net interest margin is net interest income divided by the average total interest-earning assets.




---



##### 



Quarter EndedMarch 31, 2004
    
    
    June 30, 2004
    
    
    September 30, 2004
    
    
    December 31, 2004
    
    
    Year-to-date 2004(dollars in thousands)
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    AverageInterest
    
    
    Rate
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    Rates
    
    
    
    
    
    
    Interest
    
    
    RatesAverage
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/
    
    
    Average
    
    
    Income/
    
    
    Earned/Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    Paid
    
    
    Balance
    
    
    Expense
    
    
    PaidInterest-earning assets:Cash and cash equivalents
    
    $
    14,745
    
    
    $
    185
    
    
    
    5.05
    %
    
    $
    11,994
    
    
    $
    120
    
    
    
    4.02
    %
    
    $
    7,389
    
    
    $
    139
    
    
    
    7.48
    %
    
    $
    8,865
    
    
    $
    338
    
    
    
    15.17
    %
    
    $
    11,302
    
    
    $
    782
    
    
    
    6.92
    %Restricted cash
    
    
    92,122
    
    
    
    226
    
    
    
    0.99
    
    
    
    189,097
    
    
    
    348
    
    
    
    0.74
    
    
    
    141,298
    
    
    
    586
    
    
    
    1.65
    
    
    
    115,105
    
    
    
    687
    
    
    
    2.37
    
    
    
    140,213
    
    
    
    1,847
    
    
    
    1.32Student loans
    
    
    3,153,154
    
    
    
    36,271
    
    
    
    4.63
    
    
    
    3,613,439
    
    
    
    41,998
    
    
    
    4.67
    
    
    
    3,923,198
    
    
    
    48,168
    
    
    
    4.88
    
    
    
    4,342,261
    
    
    
    57,205
    
    
    
    5.24
    
    
    
    3,758,153
    
    
    
    183,642
    
    
    
    4.89Borrower benefits
    
    
    
    
    
    
    (666
    )
    
    
    (0.09
    )
    
    
    
    
    
    
    (755
    )
    
    
    (0.08
    )
    
    
    
    
    
    
    (801
    )
    
    
    (0.08
    )
    
    
    
    
    
    
    (841
    )
    
    
    (0.08
    )
    
    
    
    
    
    
    (3,063
    )
    
    
    (0.09
    )Department of Education rebate (1)
    
    
    
    
    
    
    (8,487
    )
    
    
    (1.08
    )
    
    
    
    
    
    
    (9,581
    )
    
    
    (1.07
    )
    
    
    
    
    
    
    (10,411
    )
    
    
    (1.05
    )
    
    
    
    
    
    
    (11,535
    )
    
    
    (1.06
    )
    
    
    
    
    
    
    (40,014
    )
    
    
    (1.06
    )Amortization (2)
    
    
    
    
    
    
    (665
    )
    
    
    (0.08
    )
    
    
    
    
    
    
    (936
    )
    
    
    (0.10
    )
    
    
    
    
    
    
    (943
    )
    
    
    (0.10
    )
    
    
    
    
    
    
    (1,133
    )
    
    
    (0.10
    )
    
    
    
    
    
    
    (3,677
    )
    
    
    (0.10
    )Student loans, net of borrower benefits,
Department of Education rebate and
amortization
    
    
    3,153,154
    
    
    
    26,453
    
    
    
    3.38
    
    
    
    3,613,439
    
    
    
    30,726
    
    
    
    3.42
    
    
    
    3,923,198
    
    
    
    36,013
    
    
    
    3.65
    
    
    
    4,342,261
    
    
    
    43,696
    
    
    
    4.00
    
    
    
    3,758,153
    
    
    
    136,888
    
    
    
    3.64Total interest-earning assets
    
    $
    3,260,021
    
    
    $
    26,864
    
    
    
    3.31
    %
    
    $
    3,814,530
    
    
    $
    31,194
    
    
    
    3.29
    %
    
    $
    4,071,885
    
    
    $
    36,738
    
    
    
    3.59
    %
    
    $
    4,466,231
    
    
    $
    44,721
    
    
    
    3.98
    %
    
    $
    3,909,668
    
    
    $
    139,517
    
    
    
    3.57
    %Interest-bearing liabilities:Asset-backed notes and lines of credit
    
    $
    3,283,244
    
    
    $
    12,406
    
    
    
    1.52
    %
    
    $
    3,845,178
    
    
    $
    14,546
    
    
    
    1.52
    %
    
    $
    4,103,620
    
    
    $
    19,511
    
    
    
    1.89
    %
    
    $
    4,491,591
    
    
    $
    27,199
    
    
    
    2.41
    %
    
    $
    3,936,086
    
    
    $
    73,662
    
    
    
    1.87
    %Other debt obligations, net
    
    
    39,606
    
    
    
    639
    
    
    
    6.49
    
    
    
    60,858
    
    
    
    931
    
    
    
    6.15
    
    
    
    37,328
    
    
    
    703
    
    
    
    7.49
    
    
    
    20,809
    
    
    
    542
    
    
    
    10.36
    
    
    
    38,605
    
    
    
    2,815
    
    
    
    7.29Capital lease obligations
    
    
    1,871
    
    
    
    33
    
    
    
    7.09
    
    
    
    1,752
    
    
    
    41
    
    
    
    9.41
    
    
    
    1,709
    
    
    
    28
    
    
    
    6.52
    
    
    
    1,808
    
    
    
    32
    
    
    
    7.04
    
    
    
    1,782
    
    
    
    134
    
    
    
    7.52Total interest-bearing liabilities
    
    $
    3,324,721
    
    
    $
    13,078
    
    
    
    1.58
    %
    
    $
    3,907,788
    
    
    $
    15,518
    
    
    
    1.60
    %
    
    $
    4,142,657
    
    
    $
    20,242
    
    
    
    1.94
    %
    
    $
    4,514,208
    
    
    $
    27,773
    
    
    
    2.45
    %
    
    $
    3,976,473
    
    
    $
    76,611
    
    
    
    1.93
    %Net interest income and margin
    
    
    
    
    
    $
    13,786
    
    
    
    1.70
    %(3)
    
    
    
    
    
    $
    15,676
    
    
    
    1.65
    %(3)
    
    
    
    
    
    $
    16,496
    
    
    
    1.61
    %(3)
    
    
    
    
    
    $
    16,948
    
    
    
    1.51
    %(3)
    
    
    
    
    
    $
    62,906
    
    
    
    1.61
    %               (3)
 
 (1)
    
    Reflects the 1.05% per annum rebate fee on FFELP consolidation loans that is paid monthly divided by the average balance of student loans.(2)
    
    Represents the amortization of capitalized origination costs, deferred revenue and purchase accounting adjustments, including the 0.50%
fee payable to the Department of Education on the origination of FFELP loans.(3)
    
    Net interest margin is net interest income divided by the average total interest-earning assets.




---



##### 



Net Portfolio Margin Analysis
  Non-GAAP
    
    Quarter EndedMarch 31, 2005
    
    
    June 30, 2005
    
    
    September 30, 2005
    
    
    December 31, 2005
    
    
    Year-to-Date 2005Dollars
    
    
    %
    
    
    Dollars
    
    
    %
    
    
    Dollars
    
    
    %
    
    
    Dollars
    
    
    %
    
    
    Dollars
    
    
    %(dollars in thousands)
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)Student loan and restricted cash yield
    
    $
    69,057
    
    
    
    5.58
    %
    
    $
    80,060
    
    
    
    5.90
    %
    
    $
    91,294
    
    
    
    6.35
    %
    
    $
    
    
    
    
    
    
    
    $
    240,411
    
    
    
    5.97
    %Borrower benefits
    
    
    (1,077
    )
    
    
    (0.09
    )
    
    
    (1,185
    )
    
    
    (0.09
    )
    
    
    (1,209
    )
    
    
    (0.08
    )
    
    
    
    
    
    
    
    
    
    
    (3,471
    )
    
    
    (0.09
    )Department of Education rebate (1)
    
    
    (12,904
    )
    
    
    (1.04
    )
    
    
    (13,827
    )
    
    
    (1.02
    )
    
    
    (14,484
    )
    
    
    (1.01
    )
    
    
    
    
    
    
    
    
    
    
    (41,215
    )
    
    
    (1.02
    )Amortization (2)
    
    
    (1,332
    )
    
    
    (0.11
    )
    
    
    (1,586
    )
    
    
    (0.12
    )
    
    
    (1,483
    )
    
    
    (0.10
    )
    
    
    
    
    
    
    
    
    
    
    (4,401
    )
    
    
    (0.11
    )Net student loan and
restricted cash yield
    
    
    53,744
    
    
    
    4.34
    
    
    
    63,462
    
    
    
    4.68
    
    
    
    74,118
    
    
    
    5.16
    
    
    
    
    
    
    
    
    
    
    
    191,324
    
    
    
    4.75Asset-backed notes and lines
of credit
    
    
    (36,649
    )
    
    
    (2.96
    )
    
    
    (46,279
    )
    
    
    (3.41
    )
    
    
    (55,315
    )
    
    
    (3.85
    )
    
    
    
    
    
    
    
    
    
    
    (138,243
    )
    
    
    (3.43
    )Net portfolio margin
    
    
    17,095
    
    
    
    1.38
    
    
    
    17,183
    
    
    
    1.27
    
    
    
    18,803
    
    
    
    1.31
    
    
    
    
    
    
    
    
    
    
    
    53,081
    
    
    
    1.32Floor income (3)
    
    
    (3,153
    )
    
    
    (0.26
    )
    
    
    (1,944
    )
    
    
    (0.15
    )
    
    
    (874
    )
    
    
    (0.06
    )
    
    
    
    
    
    
    
    
    
    
    (5,971
    )
    
    
    (0.15
    )Net portfolio margin net of floor income
    
    $
    13,942
    
    
    
    1.12
    %
    
    $
    15,239
    
    
    
    1.12
    %
    
    $
    17,929
    
    
    
    1.25
    %
    
    $
    
    
    
    
    
    
    
    $
    47,110
    
    
    
    1.17
    %Reconciliation to net interest income:Net portfolio margin net of floor income
    
    $
    13,942
    
    
    
    
    
    
    $
    15,239
    
    
    
    
    
    
    $
    17,929
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    47,110Plus: interest income on cash and cash equivalents
    
    
    330
    
    
    
    
    
    
    
    346
    
    
    
    
    
    
    
    336
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,012Less: interest expense on other debt obligations, net
    
    
    (436
    )
    
    
    
    
    
    
    (437
    )
    
    
    
    
    
    
    (291
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,164
    )Less: interest expense on capital lease obligations
    
    
    (29
    )
    
    
    
    
    
    
    (27
    )
    
    
    
    
    
    
    (24
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (80
    )Plus: floor income (3)
    
    
    3,153
    
    
    
    
    
    
    
    1,944
    
    
    
    
    
    
    
    874
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,971Net interest income
    
    $
    16,960
    
    
    
    
    
    
    $
    17,065
    
    
    
    
    
    
    $
    18,824
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    52,849Average balance of student
loans and restricted cash
    
    $
    5,021,433
    
    
    
    
    
    
    $
    5,442,801
    
    
    
    
    
    
    $
    5,697,789
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    5,382,682
 
 (1)
    
    Reflects the 1.05% per annum rebate fee on FFELP consolidation loans that is paid monthly divided by the average balance of
students loans and restricted cash.(2)
    
    Represents the amortization of capitalized origination costs, deferred revenue and purchase accounting adjustments, including the 0.50%
fee payable
to the Department of Education on the origination of FFELP loans.(3)
    
    Represents the amount by which fixed rate interest income exceeds the special allowance payment spread set by the Department of Education
plus the variable rate. The company previously reported this amount net of borrower benefits.




---



##### 



Net Portfolio Margin Analysis
  Non-GAAP
    
    Quarter EndedMarch 31, 2004
    
    
    June 30, 2004
    
    
    September 30, 2004
    
    
    December 31, 2004
    
    
    Year-to-Date 2004Dollars
    
    
    %
    
    
    Dollars
    
    
    %
    
    
    Dollars
    
    
    %
    
    
    Dollars
    
    
    %
    
    
    Dollars
    
    
    %(dollars in thousands)
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)Student loan and restricted cash yield
    
    $
    36,497
    
    
    
    4.52
    %
    
    $
    42,346
    
    
    
    4.48
    %
    
    $
    48,754
    
    
    
    4.77
    %
    
    $
    57,892
    
    
    
    5.17
    %
    
    $
    185,489
    
    
    
    4.76
    %Borrower benefits
    
    
    (666
    )
    
    
    (0.08
    )
    
    
    (755
    )
    
    
    (0.08
    )
    
    
    (801
    )
    
    
    (0.08
    )
    
    
    (841
    )
    
    
    (0.08
    )
    
    
    (3,063
    )
    
    
    (0.08
    )Department of Education rebate (1)
    
    
    (8,487
    )
    
    
    (1.05
    )
    
    
    (9,581
    )
    
    
    (1.01
    )
    
    
    (10,411
    )
    
    
    (1.02
    )
    
    
    (11,535
    )
    
    
    (1.03
    )
    
    
    (40,014
    )
    
    
    (1.03
    )Amortization (2)
    
    
    (665
    )
    
    
    (0.08
    )
    
    
    (936
    )
    
    
    (0.10
    )
    
    
    (943
    )
    
    
    (0.09
    )
    
    
    (1,133
    )
    
    
    (0.10
    )
    
    
    (3,677
    )
    
    
    (0.09
    )Net student loan and
restricted cash yield
    
    
    26,679
    
    
    
    3.31
    
    
    
    31,074
    
    
    
    3.29
    
    
    
    36,599
    
    
    
    3.58
    
    
    
    44,383
    
    
    
    3.96
    
    
    
    138,735
    
    
    
    3.56Asset-backed notes and lines
of credit
    
    
    (12,406
    )
    
    
    (1.54
    )
    
    
    (14,546
    )
    
    
    (1.54
    )
    
    
    (19,511
    )
    
    
    (1.91
    )
    
    
    (27,199
    )
    
    
    (2.43
    )
    
    
    (73,662
    )
    
    
    (1.89
    )Net portfolio margin
    
    
    14,273
    
    
    
    1.77
    
    
    
    16,528
    
    
    
    1.75
    
    
    
    17,088
    
    
    
    1.67
    
    
    
    17,184
    
    
    
    1.53
    
    
    
    65,073
    
    
    
    1.67Floor income (3)
    
    
    (7,203
    )
    
    
    (0.89
    )
    
    
    (7,113
    )
    
    
    (0.75
    )
    
    
    (5,839
    )
    
    
    (0.57
    )
    
    
    (4,944
    )
    
    
    (0.45
    )
    
    
    (25,099
    )
    
    
    (0.65
    )Net portfolio margin net of floor income
    
    $
    7,070
    
    
    
    0.88
    %
    
    $
    9,415
    
    
    
    1.00
    %
    
    $
    11,249
    
    
    
    1.10
    %
    
    $
    12,240
    
    
    
    1.08
    %
    
    $
    39,974
    
    
    
    1.02
    %Reconciliation to net interest income:Net portfolio margin net of floor income
    
    $
    7,070
    
    
    
    
    
    
    $
    9,415
    
    
    
    
    
    
    $
    11,249
    
    
    
    
    
    
    $
    12,240
    
    
    
    
    
    
    $
    39,974Plus: interest income on cash and cash equivalents
    
    
    185
    
    
    
    
    
    
    
    120
    
    
    
    
    
    
    
    139
    
    
    
    
    
    
    
    338
    
    
    
    
    
    
    
    782Less: interest expense on other debt obligations, net
    
    
    (639
    )
    
    
    
    
    
    
    (931
    )
    
    
    
    
    
    
    (703
    )
    
    
    
    
    
    
    (542
    )
    
    
    
    
    
    
    (2,815
    )Less: interest expense on capital lease obligations
    
    
    (33
    )
    
    
    
    
    
    
    (41
    )
    
    
    
    
    
    
    (28
    )
    
    
    
    
    
    
    (32
    )
    
    
    
    
    
    
    (134
    )Plus: floor income (3)
    
    
    7,203
    
    
    
    
    
    
    
    7,113
    
    
    
    
    
    
    
    5,839
    
    
    
    
    
    
    
    4,944
    
    
    
    
    
    
    
    25,099Net interest income
    
    $
    13,786
    
    
    
    
    
    
    $
    15,676
    
    
    
    
    
    
    $
    16,496
    
    
    
    
    
    
    $
    16,948
    
    
    
    
    
    
    $
    62,906Average balance of student
loans and restricted cash
    
    $
    3,245,276
    
    
    
    
    
    
    $
    3,802,536
    
    
    
    
    
    
    $
    4,064,496
    
    
    
    
    
    
    $
    4,457,366
    
    
    
    
    
    
    $
    3,898,366
 
 (1)
    
    Reflects the 1.05% per annum rebate fee on FFELP consolidation loans that is paid monthly divided by the average balance ofstudents loans and restricted cash.(2)
    
    Represents the amortization of capitalized origination costs, deferred revenue and purchase accounting adjustments, including the 0.50%
fee payable
to the Department of Education on the origination of FFELP loans.(3)
    
    Represents the amount by which fixed rate interest income exceeds the special allowance payment spread set by the Department of Education
plus the variable rate. The company previously reported this amount net of borrower benefits.