**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**__________________**

**FORM      10-Q**

**__________________**

| **x**      | **Quarterly                Report Pursuant to Section 13 or 15(d) of The Securities Exchange                Act of                1934**  |   |
|------------|-------------------------------------------------------------------------------------------------------------------------------------------|--------|
|       |                                                                                                                                      |   |
|       | **For                the quarterly period ended September 30, 2005**                                                                      |   |
|       |                                                                                                                                      |   |
|       | **or**                                                                                                                                    |   |
|       |                                                                                                                                      |   |
| ** ̈** | **Transition                Report Pursuant to Section 13 or 15(d) of The Securities Exchange                Act of                1934** |   |
|       |                                                                                                                                      |   |
|       | **For                the transition period from ___ to ___**                                                                              |   |

**THE      STUDENT LOAN CORPORATION**

| **Delaware**                                            |   | **16-1427135**                                      |
|---------------------------------------------------------|--------|-----------------------------------------------------|
| (State                or other jurisdiction of          |   | (I.R.S.                Employer Identification No.) |
| incorporation                or organization)           |   |                                                |
|                                                    |   |                                                |
| **750                Washington Blvd.**                 |   | **06901**                                           |
| **Stamford,                Connecticut**                |   | (Zip                Code)                           |
| (Address                of principal executive offices) |   |                                                |

**(203)      975-6861**

**__________________**

|   | Yes | **x**  | No | **o** |   |
|--------|-----|-------------|----|-------|--------|

|   | Yes | **x**  | No | **o** |   |
|--------|-----|-------------|----|-------|--------|

|   | Yes | **o**  | No | **x** |   |
|--------|-----|-------------|----|-------|--------|

| Part                I        | Financial                Information |                                                                                                                                                                   |
|------------------------------|--------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                         |                                 |                                                                                                                                                                   | Page |
|                         | Item                1 -              | Consolidated                Financial Statements                                                                                                                       |   |
|                         |                                 |                                                                                                                                                                   |   |
|                         |                                 | Consolidated                Statement of Income (Unaudited) for the Three- and Nine-Month Periods                Ended September 30, 2005 and 2004                     | 3 |
|                         |                                 |                                                                                                                                                                   |   |
|                         |                                 | Consolidated                Balance Sheet as of September 30, 2005 (Unaudited) and December 31,                2004                (Audited)                           | 4 |
|                         |                                 |                                                                                                                                                                   |   |
|                         |                                 | Consolidated                Statement of Cash Flows (Unaudited) for the Nine-Month Periods Ended                September 30, 2005 and 2004                            | 5 |
|                         |                                 |                                                                                                                                                                   |   |
|                         |                                 | Consolidated                Statement of Changes in Stockholders’ Equity (Unaudited) for the                Nine-Month Periods Ended September 30, 2005 and 2004 | 6 |
|                         |                                 |                                                                                                                                                                   |   |
|                         |                                 | Notes                to Consolidated Financial Statements (Unaudited)                                                                                                  | 7                -                17 |
|                         |                                 |                                                                                                                                                                   |   |
|                         | Item                2 -              | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations                                              | 18                - 30 |
|                         |                                 |                                                                                                                                                                   |   |
|                         | Item                3 -              | Quantitative                and Qualitative Disclosures About Market Risk                                                                                              | 31 |
|                         |                                 |                                                                                                                                                                   |   |
|                         | Item                4 -              | Controls                and Procedures                                                                                                                                 | 32 |
|                         |                                 |                                                                                                                                                                   |   |
| Part                II       | Other                Information     |                                                                                                                                                                   |
|                         |                                 |                                                                                                                                                                   |   |
|                         | Item                6 -              | Exhibits                                                                                                                                                               | 33 |
|                         |                                 |                                                                                                                                                                   |   |
| Signature                    | 34                                   |
|                         |                                 |                                                                                                                                                                   |   |
| Exhibit                Index | 35                                   |

**PART      I  FINANCIAL INFORMATION**

| **Item                1.** | **Financial                Statements** |
|----------------------------|-----------------------------------------|

**THE      STUDENT LOAN CORPORATION**

|                                                                                                                                                                                                                                                                                  | Three                months ended        |   | Nine                months ended |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------|--------|----------------------------------|
|                                                                                                                                                                                                                                                                                  | September                30,             |   | September                30,     |
|                                                                                                                                                                                                                                                                                  | 2005                                     |   | 2004                             |   | 2005 |   | 2004 |
| **REVENUE**                                                                                                                                                                                                                                                                           |                                     |   |                             |   |   |   |   |
| Interest                income                                                                                                                                                                                                                                                        | $                340,890                 |   | $                248,096         |   | $                946,232 |   | $                673,257 |
| Interest                expense to principal shareholder                                                                                                                                                                                                                              | 217,656                                  |   | 102,740                          |   | 565,053 |   | 255,303 |
| **Net                interest income**                                                                                                                                                                                                                                                | 123,234                                  |   | 145,356                          |   | 381,179 |   | 417,954 |
| Less:                provision for loan losses                                                                                                                                                                                                                                        | (2,427)                                  |   | (1,194)                          |   | (7,828) |   | (6,490) |
| Net                interest income after provision for loan losses                                                                                                                                                                                                                    | 120,807                                  |   | 144,162                          |   | 373,351 |   | 411,464 |
|                   Gain                on sale of                loans                                  |                   49,719  |   | 355                         |   |                     97,755  |   | 10,343  |
| Fee                and other income                                                                                                                                                                                                                                                   | 4,631                                    |   | 4,617                            |   | (5,106) |   | 13,834 |
| **Total                revenue, net**                                                                                                                                                                                                                                                 | 175,157                                  |   | 149,134                          |   | 466,000 |   | 435,641 |
|                                                                                                                                                                                                                                                                                  |                                     |   |                             |   |   |   |   |
| **OPERATING                EXPENSES**                                                                                                                                                                                                                                                 |                                     |   |                             |   |   |   |   |
| Salaries                and employee benefits                                                                                                                                                                                                                                         | 12,158                                   |   | 9,827                            |   | 35,399 |   | 25,804 |
| Other                expenses                                                                                                                                                                                                                                                         | 27,688                                   |   | 24,927                           |   | 72,654 |   | 67,007 |
| **Total                operating expenses**                                                                                                                                                                                                                                           | 39,846                                   |   | 34,754                           |   | 108,053 |   | 92,811 |
| **Income                before income taxes and extraordinary item**                                                                                                                                                                                                                  | 135,311                                  |   | 114,380                          |   | 357,947 |   | 342,830 |
| Income                taxes                                                                                                                                                                                                                                                           | 52,353                                   |   | 44,691                           |   | 133,412 |   | 130,615 |
| **Income                before extraordinary item**                                                                                                                                                                                                                                   | 82,958                                   |   | 69,689                           |   | 224,535 |   | 212,215 |
| Gain                on extinguishment of trust, net** **of                taxes of $3,448 for the nine-month period ended September 30,                2005                                                                                                                      | -                                        |   | -                                |   | 5,465 |   | - |
| **NET                INCOME**                                                                                                                                                                                                                                                         | $                82,958                  |   | $                69,689          |   | $                230,000 |   | $                212,215 |
|                                                                                                                                                                                                                                                                                  |                                     |   |                             |   |   |   |   |
| **DIVIDENDS                DECLARED**                                                                                                                                                                                                                                                 | $                21,600                  |   | $                18,000          |   | $                64,800 |   | $                54,000 |
|                                                                                                                                                                                                                                                                                  |                                     |   |                             |   |   |   |   |
| **BASIC                AND DILUTED EARNINGS**                                                                                                                                                                                                                                         |                                     |   |                             |   |   |   |   |
| **PER                COMMON SHARE**                                                                                                                                                                                                                                                   |                                     |   |                             |   |   |   |   |
| (based                on 20 million average shares outstanding)                                                                                                                                                                                                                       |                                     |   |                             |   |   |   |   |
|                                                                                                                                                                                                                                                                                  |                                     |   |                             |   |   |   |   |
| Income                before extraordinary item                                                                                                                                                                                                                                       | $                4.15                    |   | $                3.48            |   | $                11.23 |   | $                10.61 |
| Extraordinary                item                                                                                                                                                                                                                                                     | -                                        |   | -                                |   | 0.27 |   | - |
| **NET                INCOME**                                                                                                                                                                                                                                                         | $                4.15                    |   | $                3.48            |   | $                11.50 |   | $                10.61 |
|                                                                                                                                                                                                                                                                                  |                                     |   |                             |   |   |   |   |
| **DIVIDENDS                DECLARED PER COMMON SHARE**                                                                                                                                                                                                                                | $                1.08                    |   | $                0.90            |   | $                3.24 |   | $                2.70 |
| **OPERATING                RATIOS**                                                                                                                                                                                                                                                   |                                     |   |                             |   |   |   |   |
| Net                interest margin                                                                                                                                                                                                                                                    | 1.85%                                    |   | 2.31%                            |   | 1.93% |   | 2.30% |
| Operating                expenses as a percentage of average managed student loans                                                                                                                                                                                                    | 0.52%                                    |   | 0.54%                            |   | 0.50% |   | 0.50% |
| Return                on Equity                                                                                                                                                                                                                                                       | 25.94%                                   |   | 25.91%                           |   | 25.28% |   | 27.92% |

**THE      STUDENT LOAN CORPORATION**

|                                                      | September                30,                                                                                                                       |                        | December                31, |
|-----------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------|-----------------------------|
|                                                      |                                                                                                                                               |                        |                        | 2005 |   | 2004 |
|                                                      |                                                                                                                                               |                        |                        | (Unaudited) |   | (Audited) |
| **ASSETS**                                                |                                                                                                                                               |                        |                        |   |   |
|                                                      | Federally                insured student loans                                                                                                     | $                18,916,342 |                        | $                18,735,335 |
|                                                      | Private                education loans                                                                                                             | 4,733,121                   |                        | 3,648,628 |
|                                                      | Deferred                origination and premium costs                                                                                              | 737,692                     |                        | 541,814 |
|                                                      | Less:                allowance for loan losses                                                                                                     | (4,665)                     |                        | (5,046) |
|                                                      | Student                loans, net                                                                                                                  |                        |                        | 24,382,490 |   | 22,920,731 |
|                                                      | Loans                held for sale                                                                                                                 |                        |                        | 1,567,867 |   | 1,930,300 |
|                                                      | Cash                                                                                                                                               |                        |                        | 742 |   | 628 |
|                                                      | Other                assets                                                                                                                        |                        |                        | 838,024 |   | 601,182 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      | **Total                Assets**                                                                                                                    |                        |                        | $                26,789,123 |   | $                25,452,841 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS' EQUITY**   |                                                                                                                                               |                        |                        |
|                                                      | Short-term                borrowings, from principal shareholder                                                                                   | $                13,139,000 |                        | $                20,986,000 |
|                                                      | Long-term                borrowings, from principal shareholder                                                                                    | 11,700,000                  |                        | 2,800,000 |
|                                                      | Deferred                income taxes                                                                                                               |                        |                        | 281,104 |   | 186,082 |
|                                                      | Other                liabilities                                                                                                                   |                        |                        | 364,562 |   | 333,852 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      | Total                Liabilities                                                                                                                   |                        |                        | 25,484,666 |   | 24,305,934 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      | Common                stock, $0.01 par value; authorized 50,000,000 shares; 20,000,000                shares                issued and outstanding | 200                         |                        | 200 |
|                                                      | Additional                paid-in capital                                                                                                          |                        | 139,355                     |   | 139,176 |
|                                                      | Retained                earnings                                                                                                                   |                        |                        | 1,164,902 |   | 999,702 |
|                                                      | Accumulated                other changes in equity from nonowner sources                                                                           | -                           |                        | 7,829 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      | Total                Stockholders' Equity                                                                                                          |                        | 1,304,457                   |   | 1,146,907 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      | **Total                Liabilities and Stockholders' Equity**                                                                                      | $                26,789,123 |                        | $                25,452,841 |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
|                                                      |                                                                                                                                               |                        |                        |   |   |   |
| **AVERAGE                OWNED STUDENT LOANS**            |                                                                                                                                               | $                26,359,634 |                        | $                24,527,543 |
| (year-to-date)                                            |                                                                                                                                               |                        |                        |   |   |
| **AVERAGE                MANAGED STUDENT LOANS**          | $                28,818,527                                                                                                                        |                        | $                25,145,211 |
| (year-to-date)                                            |                                                                                                                                               |                        |                        |   |   |
| **MANAGED                STUDENT LOANS AT END OF PERIOD** | $                30,296,832                                                                                                                        |                        | $                26,690,611 |
| (year-to-date)                                            |                                                                                                                                               |                        |                        |   |   |

**THE      STUDENT LOAN CORPORATION**

|                                                                                                         |                                                                                                                                  |        |                       |        | Nine                  months ended |
|--------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------|-------------|----------------------------|-------------|------------------------------------|
|                                                                                                         |                                                                                                                                  |        |                       |        | September                  30,     |
|                                                                                                         |                                                                                                                                  |        |                       |        | **2005**                           |   | **2004** |
| Cash                  flows from operating activities:                                                       |                                                                                                                                  |        |                       |        |
| Net                  income                                                                                  | $                  230,000                                                                                                            |        | $                  212,215 |
| Adjustments                  to reconcile net income to net cash from operating                  activities: |                                                                                                                                  |        |                       |
|                                                                                                         | Depreciation                  and amortization of equipment and computer software                                                     | 10,364      |                       | 8,120       |
|                                                                                                         | Amortization                  of servicing asset                                                                                      | 4,241       |                       | -           |
|                                                                                                         | Amortization                  of deferred loan origination and purchase costs                                                         | 88,363      |                       | 63,122      |
|                                                                                                         | Provision                  for loan losses                                                                                            | 7,828       |                       | 6,490       |
|                                                                                                         | Deferred                  tax provision                                                                                               | 100,040     |                       | 36,118      |
|                                                                                                         | Gain                  on sale of loan assets                                                                                          | (12,151)    |                       | (10,343)    |
|                                                                                                         | Gain                  on loans securitized                                                                                            | (85,604)    |                       | -           |
|                                                                                                         | Gain                  on fair value of residual interest designated as trading                                                        | (3,988)     |                       | -           |
|                                                                                                         | Gain                  on extinguishment of the 2002 Trust                                                                             | (8,913)     |                       | -           |
|                                                                                                         | Impairment                  loss on residual interests in securitized assets                                                          | 16,297      |                       | -           |
|                                                                                                         | Impairment                  loss on servicing assets in securitized assets                                                            | 8,462       |                       | -           |
|                                                                                                         | Loan                  purchases held for sale                                                                                         | (93,337)    |                       | (16,273)    |
|                                                                                                         | (Increase)                  in accrued interest receivable                                                                            | (133,703)   |                       | (33,330)    |
|                                                                                                         | (Increase)/decrease                  in other assets                                                                                  | (34,326)    |                       | 3,302       |
|                                                                                                         | Increase                  in other liabilities                                                                                        | 36,879      |                       | 4,566       |
|                                                                                                         |                                                                                                                                  |        |                       |        |                               |   |   |
| **Net                  cash provided by operating activities**                                               | 130,452                                                                                                                               |        | 273,987                    |
|                                                                                                         |                                                                                                                                  |        |                       |        |                               |   |   |
| Cash                  flows from investing activities:                                                       |                                                                                                                                  |        |                       |
|                                                                                                         | Disbursements                  of loans                                                                                               |        |                       | (2,654,220) |                               | (2,484,827) |
|                                                                                                         | Secondary                  market and other loan procurement activity for                  portfolio                             | (5,369,804) |                       | (3,314,153) |
|                                                                                                         | Redemption                  of 2002 Trust beneficial interests, including expenses                                                    | (373,352)   |                       | -           |
|                                                                                                         | Loan                  reductions                                                                                                      | 4,152,403   |                       | 2,901,267   |
|                                                                                                         | Deferral                  of loan origination costs and purchase premiums                                                             | (292,548)   |                       | (157,104)   |
|                                                                                                         | Proceeds                  from loans sold                                                                                             | 375,757     |                       | 651,363     |
|                                                                                                         | Proceeds                  from securitizations                                                                                        | 3,045,978   |                       | -           |
|                                                                                                         | Cash                  received on residual interests in securitized assets                                                            | 6,050       |                       | 10,700      |
|                                                                                                         | Capital                  expenditures on equipment and computer software                                                              | (8,802)     |                       | (18,578)    |
|                                                                                                         |                                                                                                                                  |        |                       |        |                               |   |   |
| **Net                  cash used in investing activities**                                                   | (1,118,538)                                                                                                                           |        | (2,411,332)                |
|                                                                                                         |                                                                                                                                  |        |                       |        |                               |   |   |
| Cash                  flows from financing activities:                                                       |                                                                                                                                  |        |                       |
|                                                                                                         | Net                  (decrease)/increase in borrowings with original maturities of one                  year or                  less | (1,297,000) |                       | 4,991,400   |
|                                                                                                         | Repayments                  of borrowings with original terms of one year or more                                                     | (3,650,000) |                       | (2,800,000) |
|                                                                                                         | Proceeds                  from borrowings with original terms of one year or more                                                     | 6,000,000   |                       | -           |
|                                                                                                         | Dividends                  paid to stockholders                                                                                       | (64,800)    |                       | (54,000)    |
|                                                                                                         |                                                                                                                                  |        |                       |        |                               |   |   |
| **Net                  cash provided by financing activities**                                               | 988,200                                                                                                                               |        | 2,137,400                  |

| **Net                  increase in cash**       | 114                                |     | 55                     |
|-------------------------------------------------|------------------------------------|----------|------------------------|
| **Cash                  - beginning of period** | 628                                |     | 476                    |
|                                            |                               |     |                   |   |   |   |   |
| **Cash                  - end of period**       | $                  742             |     | $                  531 |
|                                            |                               |     |                   |   |   |   |   |
| **Supplemental                  disclosure:**   |                               |     |                   |
|                                            | Cash                  paid for:    |     |                   |   |
|                                            | Interest                           | $530,688 |                   | $                  317,058 |
|                                            | Income                  taxes, net | $122,343 |                   | $                  96,078 |

**THE      STUDENT LOAN CORPORATION**

|                                                                         |                                                                                                                                                    | Nine                months ended September 30,                     |
|------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------|
|                                                                         |                                                                                                                                                    | 2005                                                               |   | 2004 |
| **COMMON                STOCK AND ADDITIONAL PAID-IN CAPITAL**               |                                                                                                                                                    |                                                               |   |
|                                                                         | Balance,                beginning of period                                                                                                             | $                139,376                                           |   | $                136,134 |
|                                                                         | Other                                                                                                                                                   | 179                                                                |   | 3,044 |
|                                                                         | Balance,                end of period                                                                                                                   | $                139,555                                           |   | $                139,178 |
|                                                                         |                                                                                                                                                    |                                                               |   |   |
| **RETAINED                EARNINGS**                                         |                                                                                                                                                    |                                                               |   |
|                                                                         | Balance,                beginning of period                                                                                                             | $                999,702                                           |   | $                786,746 |
|                                                                         | Net                income                                                                                                                               | 230,000                                                            |   | 212,215 |
|                                                                         | Common                dividends declared, $3.24 per common share in 2005; $2.70 per common                share                in 2004                  | (64,800)                                                           |   | (54,000) |
|                                                                         | Balance,                end of period                                                                                                                   | $                1,164,902                                         |   | $                944,961 |
|                                                                         |                                                                                                                                                    |                                                               |   |   |
| **ACCUMULATED                OTHER CHANGES IN EQUITY FROM NONOWNER SOURCES** |                                                                                                                                                    |                                                               |   |
|                                                                         | Balance,                beginning of period                                                                                                             | $                7,829                                             |   | $                8,444 |
|                                                                         | Net                change in cash flow hedges, net of taxes of $447 in 2004                                                                             | -                                                                  |   | 662 |
|                                                                         | Net                change in unrealized gains on investment securities, net of taxes                of                $(5,017) in 2005 and $597 in 2004 | (7,829)                                                            |   | 1,283 |
|                                                                         | Balance,                end of period                                                                                                                   | $                        - |   | $                10,389 |
|                                                                         |                                                                                                                                                    |                                                               |   |   |
| **TOTAL                STOCKHOLDERS' EQUITY**                                | $                1,304,457                                                                                                                              |                                                               | $                1,094,528 |
|                                                                         |                                                                                                                                                    |                                                               |   |   |
| **SUMMARY                OF CHANGES IN EQUITY FROM NONOWNER SOURCES**        |                                                                                                                                                    |                                                               |   |
|                                                                         | Net                income                                                                                                                               | $                230,000                                           |   | $                212,215 |
|                                                                         | Changes                in equity from nonowner sources, net of taxes                                                                                    | (7,829)                                                            |   | 1,945 |
|                                                                         | Total                changes in equity from nonowner sources                                                                                            | $                222,171                                           |   | $                214,160 |

**THE      STUDENT LOAN CORPORATION**

**Notes      to Consolidated Financial Statements (Unaudited)**

**September      30, 2005**

| **1.** | **Significant                Accounting Policies** |
|--------|----------------------------------------------------|

**Interim      Financial Information**

** **

**Use      of Estimates**

**Revenue      Recognition**

*Accounting      for Nonrefundable Fees and Costs Associated with Originating or Acquiring Loans      and Initial Direct Costs of Leases*

**Loans**

**Allowance      for Loan Losses**

**Transfer      of Student Loans through Securitization**

*Accounting      for Transfers and Servicing of Financial Assets and Extinguishments of      Liabilities, a replacement of FASB Statement No. 12*
*Consolidation      of Variable Interest Entities (revised December 2003)*

*Accounting      for Certain Investments in Debt and Equity Securities*

**Loans      Held for Sale**

**Internally      Developed Software**

*Accounting      for the Costs of Computer Software Developed or Obtained for Internal Use.      *

| **2.** | **New                Accounting Standards** |
|--------|---------------------------------------------|

***Accounting      for Certain Loans or Debt Securities Acquired in a      Transfer***

*Accounting      for Certain Loans or Debt Securities Acquired in a Transfer*

| **3.** | **Student****Loans** |
|--------|----------------------|

|                                                                                                               | **September                30,** |       | **December                31,** |   |
|--------------------------------------------------------------------------------------------------------------------|----------------------------------|------------|---------------------------------|--------|
|  (*Dollars              in thousands)*                                                                        | **2005**                         |       | **2004**                        |   |
|                                                                                                               |                             |       |                            |   |   |   |
| Federal                Stafford Loans                                                                              | $                                | 9,206,182  |                            | $      | 9,253,701 |   |
| Federal                Consolidation Loans                                                                         |                             | 8,702,340  |                            |   | 8,316,851 |   |
| Federal                SLS/PLUS/HEAL Loans                                                                         |                             | 1,007,820  |                            |   | 1,164,783 |   |
| CitiAssist                Loans                                                                                    |                             | 4,733,004  |                            |   | 3,648,496 |   |
| Other                alternative loans                                                                             |                             | 117        |                            |   | 132 |   |
| Total                student loans held, excluding deferred costs                                                  |                             | 23,649,463 |                            |   | 22,383,963 |   |
| Deferred                origination and premium costs                                                              |                             | 737,692    |                            |   | 541,814 |   |
| Loans                held                                                                                          |                             | 24,387,155 |                            |   | 22,925,777 |   |
| Less:                allowance for loan losses                                                                     |                             | (4,665     | )                               |   | (5,046 | )  |
| Loans                held, net                                                                                     |                             | 24,382,490 |                            |   | 22,920,731 |   |
| Loans                held for sale, primarily Federal Consolidation Loans, excluding deferred                costs |                             | 1,553,312  |                            |   | 1,883,084 |   |
| Deferred                origination costs                                                                          |                             | 14,555     |                            |   | 47,216 |   |
| Loans                held for sale                                                                                 |                             | 1,567,867  |                            |   | 1,930,300 |   |
| Total                loan assets                                                                                   | $                                | 25,950,357 |                            | $      | 24,851,031 |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | **September                30,** |      | **December                31,** |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------|-----------|---------------------------------|
|  *(Dollars              in thousands)*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | **2005**                         |      | **2004**                        |
| Total                CitiAssist Loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | $                                | 4,733,004 |                            | $ | 3,648,496 |
| CitiAssist                Loans in repayment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | $                                | 1,888,605 |                            | $ | 1,882,280 |
| CitiAssist                Loans in forbearance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | $                                | 146,021   |                            | $ | 132,819 |
| CitiAssist                Loans delinquent 30 - 89 days as a % of total CitiAssist Loans in                repayment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                             | 2.4%      |                            |   | 1.7% |
| CitiAssist                Loans delinquent 90 days or greater as a % of total CitiAssist Loans                in                repayment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                             | 0.9%      |                            |   | 0.6% |
| Total                allowance for loan losses for CitiAssist Loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | $                                | 2,662     |                            | $ | 3,293 |
| Allowance                for loan losses for CitiAssist Loans as a % of total CitiAssist Loans                in                repayment that are delinquent 90 days or greater                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                             | 15.6%     |                            |   | 27.4% |
| Total                CitiAssist Loans insured by third party insurers(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | $                                | 4,073,319 |                            | $ | 3,100,596 |
| Total                uninsured CitiAssist Loans(2)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | $                                | 659,686   |                            | $ | 547,900 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                             |      |                            |   |   |
| (1)                     Claims on these loans are subject to 5% - 20% risk sharing.                 Therefore, the insurer reimburses the Company 80%-95% of the approved                claim amounts.(2)      Of                the uninsured CitiAssist Loans, $512.3 million and $436.9                million are                covered between 50% and 100% of the losses up to 8% under risk-sharing                agreements                           with schools and universities at September 30, 2005 and December                31, 2004,                respectively.  |

| **4.** | **Other                Assets** |
|--------|---------------------------------|

|                                                                 |   | **September                30,** |    | **December                31,** |
|----------------------------------------------------------------------|--------|----------------------------------|---------|---------------------------------|
| (*Dollars                in thousands*)                              |   | **2005**                         |    | **2004**                        |
| Accrued                interest receivable:                          |   |                             |    |                            |   |   |
| from                student loan borrowers/others                    |   | $                                | 408,671 |                            | $ | 325,716 |
| from                federal government                               |   |                             | 109,753 |                            |   | 77,846 |
| Residual                interests in securitized assets (note 9)     |   |                             | 133,826 |                            |   | 72,733 |
| Servicing                asset from securitization activity (note 9) |   |                             | 61,104  |                            |   | 28,177 |
| Equipment                and computer software *                     |   |                             | 47,580  |                            |   | 49,142 |
| Other                financing receivables                           |   |                             | 43,043  |                            |   | 32,518 |
| Other                                                                |   |                             | 34,047  |                            |   | 15,050 |
| Total                other assets                                    |   | $                                | 838,024 |                            | $ | 601,182 |

|   | * | Amounts                are reflected net of accumulated depreciation and software amortization                of                $29.2 million and $20.0 million at September 30, 2005 and December                31,                2004, respectively. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **5.** | **Fee                and Other Income** |
|--------|-----------------------------------------|

|  *(Dollars              in              thousands)*                                              | Three-month                period ended              September                30, | Nine                month period ended                            September 30, |
|-------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                  | 2005                                                                                                                                               | 2004                                                                                                                              | 2005  | 2004  |
| Mark-to-market                gains on residual interests                                             |  $                                                                                                                                                 | 2,399                                                                                                                                  |  $ | - |  $ | 3,988 |  $ | - |
| Servicing                fees, net of amortization on securitized assets                    |                                                                                                                                                    | 2,209                                                                                                                                  |   | 123 |   | 4,086 |   | 367 |
| Origination                and servicing fees, primarily from servicing loans for                CBNA |                                                                                                                                                    | 2,375                                                                                                                                  |   | 2,467 |   | 5,000 |   | 6,876 |
| Servicing                asset impairments                                                            |                                                                                                                                                    | (99)                                                                                                                                   |   | - |   | (8,462) |   | - |
| Residual                interest impairments                                                          |                                                                                                                                                    | (4,480)                                                                                                                                |   | - |   | (16,297) |   | - |
| Late                fees                                                                              |                                                                                                                                                    | 2,127                                                                                                                                  |   | 1,925 |   | 6,277 |   | 6,225 |
| Other                                                                                                 |                                                                                                                                                    | 100                                                                                                                                    |   | 102 |   | 302 |   | 366 |
| Total                Fee and Other Income                                                             | $                                                                                                                                                       | 4,631                                                                                                                                  | $ | 4,617 | $ | (5,106) | $ | 13,834 |

| **6.** | **Related                Party Transactions** |
|--------|-----------------------------------------------|

|  *(Dollars              in thousands)*                                                                                                                                                                 |   | Three-month                period endedSeptember                30, |    | Nine-month                period endedSeptember                30, |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------|---------|--------------------------------------------------------------------|
|                                                                                                                                                                                                        |   | 2005                                                                |    | 2004                                                               |   | 2005 |   | 2004 |
| **Revenues**Interest                Expense (at weighted average interest rates of 3.4% at September                30, 2005                and 1.7% at December 31, 2004, based on the 3-month LIBOR) |   | $                                                                   | 217,656 |                                                               | $ | 102,740 |   | $ | 565,053 |   | $ | 255,303 |
| Fee                and Other Income                                                                                                                                                                         |   |                                                                | 2,375   |                                                               |   | 2,467 |   |   | 5,000 |   |   | 6,876 |
|                                                                                                                                                                                                        |   |                                                                |    |                                                               |   |   |   |   |   |   |   |   |
| **Operating                Expenses*****Salaries                and employee benefits***Employee                benefits and administration                                                                 |   | $                                                                   | 2,329   |                                                               | $ | 2,031 |   | $ | 6,842 |   | $ | 5,759 |
| Stock-based                compensation                                                                                                                                                                     |   |                                                                | 139     |                                                               |   | 252 |   |   | 630 |   |   | 696 |
| ***Other                Expenses***                                                                                                                                                                         |   |                                                                |    |                                                               |   |   |   |   |   |   |   |   |
| Servicing,                professional and other fees paid                                                                                                                                                  |   | $                                                                   | 11,264  |                                                               | $ | 9,842 |   | $ | 29,677 |   | $ | 26,848 |
| Premises,                primarily rent                                                                                                                                                                     |   |                                                                | 623     |                                                               |   | 537 |   |   | 1,861 |   |   | 1,469 |
| Communications                and data processing                                                                                                                                                           |   |                                                                | 1,618   |                                                               |   | 1,833 |   |   | 5,163 |   |   | 5,526 |
| Other                                                                                                                                                                                                       |   |                                                                | 254     |                                                               |   | 232 |   |   | 1,088 |   |   | 663 |

*CBNA      Omnibus Credit Agreement*

*CBNA      Revenue*

*Servicing      Expenses*

*Other      Intercompany Arrangements*

*CBNA      Tax-sharing Agreement*

| **7.** | **Interest                Rate Swap Agreements** |
|--------|--------------------------------------------------|

|  (Dollars              in thousands)                  |  Three-month                period ended September 30,                    |  Nine-month                period ended September 30,                |
|------------------------------------------------------------|-------------------------------------------------------------------------------------|--------------------------------------------------------------------------------|
|                                                       |  2004                                                                          | 2004                                                                           |
| Balance                at beginning of period              | $                  (526)                                                  | $                  (959)                                             |
| Net                unrealized (loss) from cash flow hedges |                           (65)(1) |                          (534)(1) |
| Net                amounts reclassified to earnings        |           294 (2)            |                         1,196(2)       |
| Balance                at end of period                    | $                  (297)                                                  | $                  (297)                                             |

| **8.** | **Commitments                and Contingencies** |
|--------|--------------------------------------------------|

| **9.** | **Student                Loan Securitizations** |
|--------|-------------------------------------------------|

| (Dollars                in millions)                                                                | Three                month period ended September 30,          | Nine                month period ended September 30,         |
|-----------------------------------------------------------------------------------------------------|---------------------------------------------------------------------|-------------------------------------------------------------------|
|                                                                                                | 2005                                                                | 2004                                                              | 2005 | 2004 |
| Student                loans securitized during the period                                          | $                1,006.6                                            | $                      -            | $                 3,032.5 | $                      - |
| Realized                gains on loans securitized                                                  |                       37.8            |                         -      |                        85.6 |                         - |
| Trading                gains recognized on residual interests at securitization                date |                         1.5 |                         - |          3.1 |                         - |

|                                                                           |                                                                                            |                                                                                |
|--------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------|
| *(Dollars                in thousands*)                                        | Three                Months Ended September                30,                             | Nine                Months Ended September                30,                  |
|                                                                           | 2005                                                                                            | 2004                                                                                | 2005 | 2004 |
| Balance                at beginning of period                                  |                  $  95,337                                                            | $33,597                                                                             | $                 72,733 | $28,672 |
|                                                                           |                                                                                            |                                                                                |   |   |
| Accreted                interest                                               |                       2,188                                       |     3,111                                                       |       4,808 |  10,267 |
|                                                                           |                                                                                            |                                                                                |   |   |
| Cash                flows from trusts                                          |                             -       |                    (3,100)                                           |                      (6,050) |  (10,700) |
|                                                                           |                                                                                            |                                                                                |   |   |
| Temporary                change in fair value of available-for-sale securities | **                            -**   |                     (3,489)                                     |                     (2,983) |                   1,880 |
|                                                                           |                                                                                            |                                                                                |   |   |
| Change                in fair value of trading securities                      |       2,399                                                       |                           -       |                      3,988 |                          - |
|                                                                           |                                                                                            |                                                                                |   |   |
| Impairment                of 2004 trust                                        |                      (4,480)                                           |                           -       |                   (16,297) |                          - |
|                                                                           |                                                                                            |                                                                                |   |   |
| New                securitizations                                             |                    38,382                                                        |            -                 |                    95,715 |                          - |
|                                                                           |                                                                                            |                                                                                |   |   |
| Extinguishment                of the 2002 Trust                                |                              - |                            - |                     (18,088) |                            - |
| Balance                at end of period                                        | $133,826                                                                                        | $30,119                                                                             | $133,826 | $30,119 |

|  *(Dollars                in thousands)* | Three                Months EndedSeptember                30, 2005 | Nine                Months EndedSeptember                30, 2005 |
|-----------------------------------------------|--------------------------------------------------------------------|-------------------------------------------------------------------|
| Balance                at beginning of period | $                47,112                                            | $                28,177                                           |
| New                securitizations            | 16,516                                                             | 45,630                                                            |
| Impairment                                    | (99)                                                               | (8,462)                                                           |
| Amortization                                  | (2,425)                                                            | (4,241)                                                           |
| Balance                at September 30, 2005  | $                61,104                                            | $                61,104                                           |

|                                                                |                               |                               |
|---------------------------------------------------------------------|------------------------------------|------------------------------------|
|                                                                | Residual                Interests  | Servicing                Assets    |
| Discount                rate                                        | 10.0%                              | 5.8%                               |
| Consolidation                prepayment rates                       | Up                to 10.0% in 6 to | Up                to 10.0% in 6 to |
|                                                                | 10                years            | 10                years            |
| Servicing                margin                                     | -                                  | 26                basis points     |
| Anticipated                net credit losses                        | 0.0%                               | -                                  |
| Basis                spread between LIBOR and Commercial Paper rate | 0.10%                              | -                                  |
| Borrower                Benefits - Automated Clearing House         | 19.3%                to 38.7%      | -                                  |
| Borrower                Benefits - On time payments                 | 15.6%                to 32.1%      | -                                  |

|                                                                |                              |                            |
|---------------------------------------------------------------------|-----------------------------------|---------------------------------|
|                                                                | Residual                Interests | Servicing                Assets |
| Discount                rate                                        | 10.0%                             | 5.9%                            |
| Consolidation                prepayment rates                       | Up                to 8.0% in      | Up                to 8.0% in    |
|                                                                | 10                years           | 10                years         |
| Servicing                margin                                     | -                                 | 23                basis points  |
| Anticipated                net credit losses                        | 0.0%                              | -                               |
| Basis                spread between LIBOR and Commercial Paper rate | 0.10%                             | -                               |
| Borrower                Benefits - Automated Clearing House         | 38.8%                to 40.0%     | -                               |
| Borrower                Benefits - On time payments                 | 13.6%                to 17.6%     | -                               |

|                                                |                               |                               |
|-----------------------------------------------------|------------------------------------|------------------------------------|
| *(Dollars                in thousands)*             | Residual                Interests  | Servicing                Assets    |
| Fair                value at September 30, 2005     | $                133,826           | $                64,575            |
| Discount                rate                        | 10.0%                              | 5.8%                               |
| 10%                adverse change                   | $                (5,925.3)         | $                (1,413.5)         |
| 20%                adverse change                   | $                (11,402.3)        | $                (2,772.7)         |
| Consolidation                prepayment rate        | Up                to 10.0% in 6 to | Up                to 10.0% in 6 to |
|                                                | 10                years            | 10                years            |
| 10%                adverse change                   | $                (2,521.0)         | $                (1,217.0)         |
| 20%                adverse change                   | $                (4,952.0)         | $                (2,350.8)         |
| Servicing                margin                     | -                                  | 26                basis points     |
| 10%                adverse change                   | -                                  | $                (5,116.3)         |
| 20%                adverse change                   | -                                  | $                (10,234.6)        |
| Basis                spread                         | 0.10%                              | -                                  |
| 10%                adverse change                   | $                (2,046.5)         | -                                  |
| 20%                adverse change                   | $                (4,092.9)         | -                                  |
| Borrower                benefits - ACH              | 19.3%                to 38.7%      | -                                  |
| 10%                adverse change                   | $                (1,387.5)         | -                                  |
| 20%                adverse change                   | $                (2,775.0)         | -                                  |
| Borrower                benefits - on time payments | 15.6%                to 32.1%      | -                                  |
| 10%                adverse change                   | $                (3,463.7)         | -                                  |
| 20%                adverse change                   | $                (6,927.5)         | -                                  |

| **10.** | **Future                Application of Accounting                Standards** |
|---------|------------------------------------------------------------------------------|

***Stock-based      Compensation***

*Share-Based      Payment*

| **Item                2.** | **Management's                Discussion and Analysis of Financial Condition and Results of                Operations** |
|----------------------------|-------------------------------------------------------------------------------------------------------------------------|

**Critical      Accounting Policies**

**New      Accounting Standards**

***Certain      Loans or Debt Securities Acquired in a Transfer***

*Accounting      for Certain Loans or Debt Securities Acquired in a Transfer*

**Management      Summary**

***Special      Allowance and Floor Income***
** **

**Forward-Looking      Statements**

**Financial      Condition**

|                                                                                |                              |                              |
|-------------------------------------------------------------------------------------|-----------------------------------|-----------------------------------|
| *(Dollars                in millions)*                                              | September                30, 2005 | September                30, 2004 |
| Balance                at beginning of period                                       | $24,856                           | $23,196                           |
| FFEL                Program Stafford and PLUS Loan (1)                disbursements | 2,654                             | 2,485                             |
| Secondary                market and other loan procurement activities               | 5,463                             | 3,330                             |
| Redemption                of the 2002 Trust                                         | 370                               | -                                 |
| Loan                reductions(2)                                                   | (4,152)                           | (2,901)                           |
| Loan                securitizations                                                 | (3,033)                           | -                                 |
| Portfolio                sales                                                      | (364)                             | (641)                             |
| Deferred                costs and other adjustments                                 | 161                               | 89                                |
| Balance                at end of period                                             | $25,955                           | $25,558                           |

|   | (1) | FFEL                Program PLUS Loans are Parent Loans to Undergraduate                Students. |
|--------|-----|---------------------------------------------------------------------------------------------------|

|   | (2) | Loan                reductions are attributable primarily to borrower principal payments,                loan                consolidations and claims paid to                guarantors. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***Loan      Activity***

|                *(Dollars                in millions)*                   | Three-month                period ended September 30,                        | Nine-month                period ended September 30,                               |
|------------------------------------------------------------------------------|------------------------------------------------------------------------------|------------------------------------------------------------------------------------|
|                                                                         | 2005                                                                         | 2004                                                                               | 2005 | 2004 |
| FFEL                Program Stafford and PLUS Loan disbursements             | $1,079                                                                       | $                1,034                                                             | $2,654 | $2,485 |
| CitiAssist                Loans disbursed under commitments to purchase, net |                          622(1) |                           542(2) |        1,310(1) |        1,112(2) |
| Total                loan disbursements and commitments                      | $1,701                                                                       | $                1,576                                                             | $3,964 | $3,597 |

|   | (1) | These                amounts consist of the CitiAssist Loans that were disbursed by CBNA                in the                three- and nine-month periods ended September 30, 2005. Out of the                originations, approximately $607 million were under commitments to                purchase at September 30, 2005. In addition, $533 million of CitiAssist                Loan commitments were awaiting disbursement by CBNA. These loans                will be                purchased by the Company after final                disbursement. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | These                amounts consist of the CitiAssist Loans that had been disbursed by                CBNA in                the three- and nine-month periods ended September 30, 2004. Out of                the                originations, approximately $530 million were under commitments to                purchase at September 30, 2004. In addition, $676 million of CitiAssist                Loan commitments were awaiting disbursement by CBNA. These loans                were                purchased by the Company after final                disbursement. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| *(Dollars                in millions)*                                      | Three-month                periodsended                September 30, | Nine-month                periodsended                September 30, |
|-----------------------------------------------------------------------------|----------------------------------------------------------------------|---------------------------------------------------------------------|
|                                                                        | 2005                                                                 | 2004                                                                | 2005 | 2004 |
| FFEL                Program volume, primarily Consolidation Loans           |       $2,040(1)                        |                      $1,011(2)             |                      $3,567(3) |                    $1,979(4) |
| Purchases                of CitiAssist Loans                                |                      131                    |                        90        |                    1,348 |   1,081 |
| Other                loan purchases                                         |                      145                    |                        33        |                       548 |                     270 |
| Total                secondary market and other loan procurement activities |  $2,316                                                         | $1,134                                                              |                  $5,463 | $3,330 |

|   | (1) | Amount                includes $18 specifically purchased for                resale. |
|--------|-----|--------------------------------------------------------------------------------------|

|   | (2) | Of                this amount, none were specifically purchased for                resale. |
|--------|-----|-------------------------------------------------------------------------------------------------|

|   | (3) | Amount                includes $93 specifically purchased for                resale. |
|--------|-----|--------------------------------------------------------------------------------------|

|   | (4) | Amount                includes $16 specifically purchased for                resale. |
|--------|-----|--------------------------------------------------------------------------------------|

***Net        Interest Margin Spread Analysis***

|                                                                          | Three-month                  periodsEnded                  September 30, | Nine-month                  periodsended                  September 30, |
|-------------------------------------------------------------------------------|--------------------------------------------------------------------------|-------------------------------------------------------------------------|
|                                                                          | 2005                                                                     | 2004                                                                    | 2005 | 2004 |
| Student                  loan yield, before floor income                      | 5.79                  %                                                  | 4.06                  %                                                 | 5.32                  % | 3.86                  % |
| Floor                  income                                                 | 0.24                  %                                                  | 0.49                  %                                                 | 0.32                  % | 0.56                  % |
| Consolidation                  loan rebate fees                               | (0.43)%                                                                  | (0.44)%                                                                 | (0.44)% | (0.44)% |
| Accreted                  interest on securitizations                         | 0.03                  %                                                  | 0.05                  %                                                 | 0.03                  % | 0.06                  % |
| Amortization                  of deferred loan origination and purchase costs | (0.52)%                                                                  | (0.22)%                                                                 | (0.44)% | (0.34)% |
| Student                  loan net yield                                       | 5.11                  %                                                  | 3.94                  %                                                 | 4.79                  % | 3.70                  % |
| Student                  loan cost of funds                                   | (3.26)%                                                                  | (1.63)%                                                                 | (2.86)% | (1.40)% |
| Student                  loan spread                                          | 1.85                  %                                                  | 2.31                  %                                                 | 1.93                  % | 2.30                  % |

***Rate/Volume        Analysis***

|                                          | Three                  Months Ended September 30, 2005 vs. Three Months Ended September                  30,                  2004 |                      | Nine                  Months Ended September 30, 2005 vs. Nine Months Ended September                  30,                  2004 |
|-----------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------|---------------------------|----------------------------------------------------------------------------------------------------------------------------------|
| *(Dollars                  in millions)*      | Increase                  (Decrease) Due to Change In:                                                                             |                      | Increase                  (Decrease) Due to Change In:                                                                           |
|                                          | Volume                                                                                                                             | Rate(a)                   | Net(b)                                                                                                                           |   | Volume | Rate(a) | Net(b) |
| Interest                  earning assets      | $                  15.0                                                                                                            | $                  77.8   | $                  92.8                                                                                                          |   | $58.1 | $214.9 | $273.0 |
| Interest                  bearing liabilities | 5.6                                                                                                                                | 109.3                     | 114.9                                                                                                                            |   | 21.0 | 288.8 | 309.8 |
| Net                  interest income          | $                  9.4                                                                                                             | $                  (31.5) | $                  (22.1)                                                                                                        |   | $37.1 | $(73.9) | $(36.8) |

| (a)   | Changes                  in rates for interest bearing liabilities refer to fluctuations                  in Federal                  Funds, LIBOR and Treasury Bill                  indices. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | Rate/volume                  variance is allocated based on the percentage relationship changes                  in                  volume and changes in rate to the absolute dollar amount of changes                  in                  each. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***Special        Allowance and Floor Income***

***Loans***

***Private      Education Loans in Repayment***

*** ***

| *(Dollars                in millions)*             | September                30, 2005     | %    | December                31, 2004                  | %    |
|----------------------------------------------------|---------------------------------------|------|---------------------------------------------------|------|
| Insured                CitiAssist Loans            | $1,535                                | 81%  | $                1,502                            | 80%  |
| Uninsured                CitiAssist Loans          |                    354 | 19%  |                      380 | 20%  |
| Total                CitiAssist Loans in repayment | $1,889                                | 100% | $1,882                                            | 100% |

***Revenue      Recognition***

***Securitization      Activity and Off Balance Sheet Transactions***

***Allowance      for Loan Losses***

| *(Dollars                in**thousands)*                                               | Third                Quarter2005 | Second                Quarter2005 | First                Quarter                2005 | Fourth                Quarter                2004 | Third Quarter                2004 |
|----------------------------------------------------------------------------------------|----------------------------------|-----------------------------------|--------------------------------------------------|---------------------------------------------------|----------------------------------------|
|                                                                                   |                             |                              |                                             |                                              |                                   |
| **Balance                at beginning of period**                                      |                             |                              |                                             |                                              |                                   |
| FFEL                Program                                                            | $1,338                           | $1,602                            | $1,753                                           | $1,821                                            | $1,950                                 |
| CitiAssist                                                                             | 3,327                            | 2,744                             | 3,293                                            | 3,724                                             | 3,596                                  |
|                                                                                   | 4,665                            | 4,346                             | 5,046                                            | 5,545                                             | 5,546                                  |
| **Provision                for loan losses**                                           |                             |                              |                                             |                                              |                                   |
| FFEL                Program                                                            | 1,354                            | 919                               | 502                                              | (340)                                             | 166                                    |
| CitiAssist                                                                             | 1,073                            | 3,880                             | 100                                              | 1,839                                             | 1,028                                  |
|                                                                                   | 2,427                            | 4,799                             | 602                                              | 1,499                                             | 1,194                                  |
| **Charge                offs**                                                         |                             |                              |                                             |                                              |                                   |
| FFEL                Program                                                            | (691)                            | (1,184)                           | (801)                                            | 83                                                | (421)                                  |
| CitiAssist                                                                             | (2,001)                          | (3,511)                           | (1,470)                                          | (2,373)                                           | (1,086)                                |
|                                                                                   | (2,692)                          | (4,695)                           | (2,271)                                          | (2,290)                                           | (1,507)                                |
| **Recoveries**                                                                         |                             |                              |                                             |                                              |                                   |
| FFEL                Program                                                            | 2                                | 1                                 | 148                                              | 189                                               | 126                                    |
| CitiAssist                                                                             | 263                              | 214                               | 821                                              | 103                                               | 186                                    |
|                                                                                   | 265                              | 215                               | 969                                              | 292                                               | 312                                    |
| **Balance                at end of period **FFEL                ProgramCitiAssist | 2,0032,662                       | 1,3383,327                        | 1,6022,744                                       | 1,7533,293                                        | 1,8213,724                             |
|                                                                                   | $4,665                           | $4,665                            | $4,346                                           | $5,046                                            | $5,545                                 |

***Interest      Rate Swap Agreements***

*      Accounting for Derivative Instruments and Hedging Activities, *

***Extraordinary      Item***

***Taxes***

***Other      Liabilities***

***Borrowings***

***Dividends***

***Sources      and Uses of Cash***

**Results      of Operations**

**Quarter      Ended September 30, 2005 **

***Net      income***

***Gain      on sale of      Loans***

***Fee      and other income***

***Net      interest income***

***Special      Allowance and Floor Income***

***Operating      expenses***

***Loan      losses***

***Return      on Average Equity***

***Effect      of Taxes***

**Nine      Months Ended September 30, 2005 **

***Net      income***

***Gain      on sale of      loans***

***Fee      and other income***

***Net      interest income***

***Operating      expenses***

***Loan      losses***

***Return      on Average Equity***

***Effect      of Taxes***

**Regulatory      Impacts**

**Forward-Looking      Statements**

**Forward      Looking Statements**

| **Item                3.** | **Quantitative                and Qualitative Discussion About Market                Risk** |
|----------------------------|---------------------------------------------------------------------------------------------|

|                                            |   | September                30, 2005 |   | September                30, 2004 |   |
|-------------------------------------------------|--------|-----------------------------------|--------|-----------------------------------|--------|
| *(Dollars                in millions)*          |   | Next12                Mos.        |   | Thereafter                        |   | Total |   | Next12                Mos. |   | Thereafter |   | Total |   |
| Thirty-five                basis point increase |   | $                                 | (20.4  | )                                 | $      | (85.1 | ) | $ | (105.5 | ) | $ | (18.4 | ) | $ | (82.6 | ) | $ | (101.0 | ) |
| Thirty-five                basis point decrease |   | $                                 | 18.1   |                              | $      | 85.7 |   | $ | 103.8 |   | $ | 17.5 |   | $ | 82.6 |   | $ | 100.1 |   |
| One                hundred basis point increase |   | $                                 | (13.0  | )                                 | $      | (140.1 | ) | $ | (153.1 | ) | $ | (51.9 | ) | $ | (233.6 | ) | $ | (285.5 | ) |
| One                hundred basis point decrease |   | $                                 | 49.0   |                              | $      | 242.3 |   | $ | 291.2 |   | $ | 58.7 |   | $ | 233.6 |   | $ | 292.3 |   |

| **Item                4.** | **Controls                and Procedures** |
|----------------------------|--------------------------------------------|

|   | **(a)** | **Disclosure                Controls and Procedures** |
|--------|---------|-------------------------------------------------------|

|   | **(b)** | **Internal                Control Over Financial                Reporting** |
|--------|---------|-----------------------------------------------------------------------------|

**PART        II. OTHER INFORMATION**

| **Item                6.** | **Exhibits** |
|----------------------------|--------------|

|   | The                Student Loan Corporation |                                                                                              |
|--------|---------------------------------------------|---------------------------------------------------------------------------------------------------|
|   |                                        |                                                                                              |   |
|   |                                        |                                                                                              |   |
|   |                                        |                                                                                              |   |
|   |                                        |                                                                                              |   |
|   |                                        |                                                                                              |   |
|   | By                                          | /s/                Daniel P. McHugh                                                               |   |
|   |                                        | Daniel                P. McHughChief                Financial Officer and Duly Authorized Officer |
|   |                                        | (Principal                  Financial Officer)                                          |

**EXHIBIT      INDEX**

**Exhibit      **

| **Number** | **Description                of Exhibit** |
|------------|-------------------------------------------|

| 3.1 | Restated                Certificate of Incorporation of the Company, incorporated by reference                to                Exhibit 3.1 to the                Company’s 1992 Annual Report on Form 10-K (File No.                1-11616). |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3.2 | By-Laws                of the Company, as amended, incorporated by reference to Exhibit                3.2 to                the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended                September 30, 1993 (File No.                1-11616). |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.1 | Trust                Agreement, dated as of December 21, 1992, between the Company and                CNYS,                incorporated by                reference to Exhibit 10.2 to the Company’s 1992 Annual Report on Form 10-K                (File No. 1-11616). |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.1 | Non-Competition                Agreement, dated as of December 22, 1992, among the Company, CNYS                and                Citicorp,                incorporated by reference to Exhibit 10.4 to the Company’s 1992 Annual                Report on Form 10-K (File No.                1-11616). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.2 | Amendment                No. 1, dated as of June 22, 2000, to Non-Competition Agreement among                the                Company, CNYS and Citigroup Inc., incorporated by reference to Exhibit                10.2.2 to the Company’s 2001 Annual Report on Form 10-K (File No.                1-11616). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.3 | Amendment                No. 2, dated as of June 22, 2001, to Non-Competition Agreement among                the                Company, CNYS and Citigroup Inc., incorporated by reference to Exhibit                10.2.3 to the Company’s 2001 Annual Report on Form 10-K (File No.                1-11616). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.4 | Amendment                No. 3, dated as of May 5, 2002, to Non-Competition Agreement among                the                Company, CNYS and Citigroup Inc., incorporated by reference to Exhibit                10.2.4 to the Company’s Quarterly Report on Form 10-Q for the fiscal                quarter ended September 30, 2004 (File No.                1-11616). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.5 | Amendment                No. 4, dated as of June 22, 2003, to Non-Competition Agreement among                the                Company, CNYS and Citigroup Inc., incorporated by reference to Exhibit                10.2.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal                quarter ended September 30, 2004 (File No.                1-11616). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.6 | Amendment                No. 5, dated as of June 22, 2004, to Non-Competition Agreement among                the                Company, CBNA and Citigroup Inc., incorporated by reference to Exhibit                10.2.6 to the Company’s Quarterly Report on Form 10-Q for the fiscal                quarter ended September 30, 2004 (File No.                1-11616). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2.7 | Amendment                No. 6, dated as of June 22, 2005, to Non-Competition Agreement among                the                Company, CBNA and Citigroup Inc., incorporated by reference to Exhibit                10.2.7 to the Company's Quarterly Report on Form 10-Q for the fiscal                quarter ended June 30, 2005 (File No.                1-11616).  |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.3 | Tax                Agreement, dated as of December 22, 1992, between the Company and                CNYS,                incorporated by                reference to Exhibit 10.5 to the Company’s 1992 Annual Report on Form 10-K                (File No. 1-11616). |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4 | Omnibus                Credit Agreement, dated November 30, 2000, between the Company and                CNYS,                incorporated                by reference to Exhibit 10.10 to the Company’s 2000 Annual Report on Form                10-K (File                No. 1-11616). |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4.1 | Amendment                No. 1, dated as of October 15, 2002, to Omnibus Credit Agreement                between                the Company and                CNYS, incorporated by reference to Exhibit 10.4.1 to the Company’s 2002                Annual Report on Form 10-K (File No. 1-11616). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4.2 | Amendment                No. 2, dated as of March 5, 2004, to Omnibus Credit Agreement between                the                Company and CBNA (as successor to CNYS), incorporated by reference                to                Exhibit 10.4.2 to the Company’s 2003 Annual Report on Form 10-K (File No.                1-11616). |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.4.3 | Amendment                No. 3, dated as of January 20, 2005, to Omnibus Credit Agreement                between                the Company and CBNA (as successor to CNYS), incorporated by reference                to                Exhibit 10.4.3 to the Current Report on Form 8-K filed January 20,                2005                (File No. 1-11616). |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.5 | Facilities                Occupancy, Management and Support Service Agreement, dated as of                January                1, 1998, by and between the Company, CNYS and Citicorp North America,                Inc., incorporated by reference to Exhibit 10.5 to the Company’s 2001                Annual Report on Form 10-K (File No.                1-11616). |
|------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.6 | Retention                Agreement for Sue F. Roberts, dated April 28, 2003, incorporated                by                reference to Exhibit 10.6 to the                Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March                31, 2004 (File                No. 1-11616). |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.6.1 | Letter                Agreement, dated as of February 11, 2005, by and between the Company                and                Sue F. Roberts, incorporated by reference to Exhibit 10.6.1 to the                Company's 2004 Annual Report on Form 10-K (File                No.                1-11616). |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.7 | Amended                and Restated Agreement for Education Loan Servicing among the Company,                Citibank USA, N.A. and Citibank, N.A.,  incorporated by reference                to                Exhibit 10.7 to the Company's Quarterly Report on Form 10-Q for the                fiscal                quarter ended September 30, 2004 (File No.                1-11616). |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.1* | Certification                of Principal Executive Officer pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002. |
|-------|---------------------------------------------------------------------------------------------------------------------------------------|

| 31.2                * | Certification                of Principal Financial Officer pursuant to Section 302 of the                Sarbanes-Oxley Act of 2002 |
|-----------------------|--------------------------------------------------------------------------------------------------------------------------------------|

| 32.1                * | Certification                of Chief Executive Officer and Chief Financial Officer pursuant to                18                U.S.C. Section 1350, as adopted pursuant to Section 906 of the                Sarbanes-Oxley Act of 2002. |
|-----------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|