The company said it lost $52 million, or 10 cents per share, compared with a loss of $514 million, or $1.06 per share a year ago.

The biggest difference was that a year ago Sallie Mae wrote off nearly $670 million of goodwill and intangible assets. In the current quarter the write-off was $6 million.

The company also posted a $371 million unrealized loss on derivative contracts, compared with $269 million in similar losses a year ago.

Excluding the write-down and other one-time costs, the company would have earned $188 million, or 36 cents per share, compared with $202 million, or 37 cents per share a year ago.

Analysts surveyed by FactSet expected 35 cents.

Shares fell 34 cents, or 2.5 percent, to close at $13.33. They slid 3 cents in after-market trading.

Sallie Mae, whose official name is SLM Corp., said net interest income rose to $885 million, from $872 million in the prior-year period. Analysts were expecting net interest income of $753 million, according to FactSet.

The company originated $1.1 billion in private education loans during the quarter, up 29 percent from the same period last year. The portfolio totaled $36.2 billion at the end of the quarter.

Despite a growing loan portfolio, the lender set aside $384 million for future private sbi education loan losses, compared with $330 million in the prior-year quarter.

"Loan portfolio quality continues to improve, though the economic slump and long-term unemployment have reduced default recoveries, keeping us at conservative reserve levels," CEO Albert Lord said in a statement.

Delinquencies as a percentage of private education loan in repayment fell to 5 percent, down from 5.7 percent a year earlier. The company gave up on collecting 3.7 percent of its loans, down from 5.4 percent in the third quarter of 2010.

For the full year the company said it expects earnings per share of $1.80. Analysts expect $1.81.