Holders of Academic Management Services student loan ABS were bailed out from the recent troubles surrounding the name (see ASR 7/28/03), following the closing of its acquisition by Sallie Mae last week. Sallie Mae is expected to pay down the two outstanding senior/subordinated transactions and add the loans in the pool to its own future securitizations.

As a result of the sale, UICI will realize net cash proceeds of approximately $27.8 million. Additionally, UICI also received uninsured student loan assets formerly held by AMS, totaling $44.3 million, including accrued interest. The loans being transferred to Sallie Mae are performing as normal, sources confirmed. "The trouble resulted from the trust being administered improperly, contrary to the documentation," noted Moody's Investors Service senior credit officer Sharon Asch. "The loans are fine."

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