NEWARK, Del. – Sallie Mae yesterday reported 22% growth in private student loans for 2012, helping push annual earnings up 48% to $939 million.

The student loan giant reported a 12.5% surge in private loan originations for the fourth quarter to $514 million, and a 22% increase for the year to $3.3 billion, as it carved out a greater share of the market increasingly sought by credit unions.

Net income was down for the fourth quarter by 32% to $348 million, as the company reported a $28 million loss on derivatives trading, from $511 million for the fourth quarter of 2011, when it reported a $272 million gain on derivatives.

But the company had a large increase in net income for the full year solely because it reported a big decrease in derivatives losses from the year before, a $628 million loss, compared to $929 million loss.

The fourth quarter included: delinquencies of 90 days or more of 4.6% of loans in repayment, loans in forbearance of 3.5% of loans in repayment and forbearance, annualized charge-off rate of 4.19% of loans in repayment, and a provision for private education loan losses of $296 million, up from $255 million.

“Our key 2012 objectives were to grow the private loan franchise, make distributions from our legacy FFELP business, and maintain strong capital and reserves. We accomplished all three, and we continue on this course,” said Albert Lord, Sallie Mae CEO.  “As expected, charge-offs accelerated in the fourth quarter largely due to recent reductions in forbearance. We still view the economy warily and commit to help customers manage their borrowing and succeed in its payoff.”


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