Salie Mae Enters Multi-Year Private Credit Partnership With KKR

Sallie Mae SLM has announced a multi-year partnership with KKR & Co. KKR, marking its entry into the growing private credit market.

Through this multi-year partnership, KKR will acquire an initial seed portfolio of private education loans from Sallie Mae, followed by purchases of at least $2 billion in newly originated private education loans each year over an initial three-year period.

Sallie Mae will continue to manage customer relationships and service the loans sold to KKR, earning ongoing fees for providing loan servicing, program management, and industry expertise.

Rationale Behind SLM-KKR Partnership

Historically known for its private student lending business, Sallie Mae has been seeking new avenues for growth amid a more competitive and regulated education-finance landscape. The partnership with KKR signals a clear pivot toward the fast-growing private credit market, where institutional demand for alternative lending products continues to rise.

By expanding access to advanced, scalable and capital-efficient funding, this strategic partnership is likely to bolster SLM’s loan origination capacity and ability to serve students and families.

Jon Witter, chief executive officer, Sallie Mae, stated, "We believe this inaugural partnership with KKR will unlock the potential for off-balance sheet capital efficiency, create a more resilient, capital-light, and consistent earnings profile, and allow us to serve more students and families."

Avi Korn, managing director and co-head of asset-based finance at KKR, stated, "We're pleased to partner with Sallie Mae, a market leader with a strong track record of disciplined underwriting and servicing performance, as it expands its ability to serve students and optimize its balance sheet." "This transaction exemplifies the opportunities we’re seeing across our Asset-Based Finance strategy to deploy long-term, flexible capital in support of high-quality, scaled financial institutions," he added.

Our Take on SLM-KKR Partnership

The partnership with KKR positions Sallie Mae to strengthen long-term growth potential. By leveraging KKR’s deep expertise in private credit and institutional capital, SLM can expand into new, higher-yielding asset classes while reducing its dependence on the cyclical student-loan market. 

If executed effectively, this initiative may provide a durable competitive edge and support consistent shareholder value creation, potentially transforming SLM from a niche education lender into a more balanced, multi-segment financial platform.

SLM Zacks Rank & Price Performance

SLM shares have gained 3.4% year to date compared with the industry’s growth of 48.6%.

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Similar Steps by Other Financial Firms

In September 2025, Goldman Sachs GS and T. Rowe Price TROW formed a partnership to expand retirement and wealth solutions across public and private markets. Goldman will invest $1 billion for a 3.5% stake in T. Rowe, gaining access to its retirement-focused clients. The collaboration will roll out private market access, Target-Date Strategies (mid-2026), model portfolios, multi-asset offerings and advisor-managed accounts.

The Goldman-T. Rowe initiative marks a significant step in bringing alternatives into mainstream retirement and wealth planning. The partnership will unfold in phases, starting with high-net-worth clients in 2025 and expanding to retirement savers in 2026. Together, the companies will be able to reshape retirement portfolio management by balancing traditional strategies with the growing demand for exposure to private markets.

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This article originally published on Zacks Investment Research (zacks.com).

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