Student Loan Pains Grip Navient Investors Seeing Funding Squeeze
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Debt investors are growing anxious that potential ratings downgrades on billions of dollars of student-loan securities will squeeze Sallie Mae spinoff Navient Corp.
Credit traders have pushed the cost of derivatives protecting against losses on the company’s debt to the highest in three years. Holders of the company’s bonds have lost 6.2 percent this month as prices of the debt plunged, Bank of America Merrill Lynch index data show. Navient is the largest servicer of government-backed student debt.