Already reeling from the collapsed credit markets, Student Loan Corp. was dealt another blow in early August after parent company Citigroup Inc. altered the terms of a noncompete agreement between the affiliates.
Stamford-based Student Loan Corp. informed investors that the changed noncompete agreement could have an adverse impact on its business.
Student Loan Corp. is in the process of laying off 150 employees, after suspending college loans it has offered under the Federal Family Education Loan Program.
The altered contract allows Citibank North America and other Citigroup affiliates to acquire other businesses that make student loans, though student lending cannot represent more than 5 percent of the revenue of the acquired entity. Citigroup did not indicate whether the change was motivated by any specific acquisition in the works.
