Selling riskier student loan backed securities boosted Sallie Mae’s earnings in the second quarter.

In a press release issued late Wednesday, the company said it booked a $257 million gain on the sale of the residual interest in older securitizations of federally guaranteed student loans.

Sallie Mae’s second-quarter net income rose to $543 million from $292 million a year earlier, when reported on the basis of generally accepted accounting principles.

The company’s “core” earnings, which exclude changes in mark-to-market unrealized gains and losses on derivative contracts and amortization and impairment of goodwill and intangible asset, rose to $462 million from $243 million a year earlier. 

In addition to the gain on the sale of residual interests in federally guaranteed loan securitizations, it also benefitted from a $38 million after-tax gain from the sale of its Campus Solutions business and a $42 million decline in the provision for losses on private student loans.

Sallie Mae no longer makes Federal Family Education Loan Program loans, as the U.S. government eliminated the program in 2010. Its portfolio of FFELP loans is amortizing. At June 30, 2013, the company held $108 billion of FFELP loans compared with $133 billion at June 30, 2012. Approximately $12 billion of the $25 billion decline in FFELP loans is a result of the sales of the residual interests in FFELP loan securitization trusts.

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