1. CRI- Common Review Initiative Improving Accountability in the FFEL Program Through Cooperation November 17, 2003 Mike Hawkes Educational Credit Management Corporation

2. DISCLAIMER: This presentation was prepared in October, 2003. CRI is an evolving concept; accordingly, information contained in this presentation may not be 100% accurate by the time this session is presented at the Fall Training Conference.

3. 2 CRI Concept Guarantors would combine resources to conduct a single review of large lenders and servicers. Each CRI review would go toward meeting the requirements of 682.410(c)(1) for all CRI participating guarantors

4. 3 CRI Progress CRI – great progress in less than one year Concept to Guarantor CEO caucus in November 2002 Steering Committee formed – December 2002 Conference call in February 2003 Face-to-face meeting in March 2003 Workgroups have been meeting ever since

5. 4 Current CRI Status August 27, 2003 Final CRI proposal to ED Proposal went to ED with endorsements from: All 36 guaranty agencies Student Loan Servicing Alliance (SLSA) Consumers Bankers Association (CBA) Education Finance Council (EFC) National Council of Higher education Loan Programs (NCHELP)

6. 5 Current CRI Status September 23, 2003 Met in DC with Financial Partners September 30, 2003 Suggested deadline for determining CRI participation by signing agreement To date, 28 of 36 guarantors have signed CRI agreement

7. 6 Current CRI Status October 29, 2003 First CRI conference call since agreements signed November 16, 2003 CRI review team member training December 10, 2003 First meeting of CRI Oversight and Administration Council 2004-2005 biennium Begin conducting CRI reviews

8. 7 Current CRI Status On-going CRI projects Completion of CRI review procedures and review guide Completion of CRI administrative policies and procedures manual Lender selection and review scheduling for 2004-2005 reviews

9. 8 CRI Focus Initial focus – reduce redundancy in lender reviews by guarantors Current focus – improving review quality with added benefit of reducing redundancy

10. 9 CRI – Improving Reviews Current file review process inherently limited Not inclusive of all attributes Sample sizes limited CRI review protocol avoids these limitations Use of attribute testing Statistically valid sampling to provide a 95% confidence level Adoption of best practices

11. 10 CRI – Improving Reviews ED Lender Review Guide is base document for CRI review protocol CRI review teams would test additional attributes not contained in Guide CRI reviews would not test LaRS Proposal calls for ED to test this CRI reviews would track findings back to LaRS where adjustments are necessary

12. 11 CRI Review Selection CRI reviews would be conducted at lenders/servicers required to be reviewed by at least four guarantors Servicer reviews would apply to all lenders contracting with that servicer

13. 12 CRI Reviews - Lenders CRI reviews would tentatively be conducted at the following lenders: Citibank (currently reviewed by 12 GAs) Educaid/Wachovia (14) Wells Fargo (14)

14. 13 CRI Reviews - Servicers CRI reviews would tentatively be conducted at the following servicers: ACS (currently reviewed by 10 GAs) AES (6) Edamerica (7) KHESLC (7) MOHELA (4)

15. 14 CRI Reviews - Servicers CRI reviews would tentatively be conducted at the following servicers: Nelnet (currently reviewed by 24 GAs) Sallie Mae (24) SSSC (5) Suntech (9)

16. 15 CRI Benefits Current focus – improving review quality with added benefit of reducing redundancy Demonstrably better reviews through attribute testing, statistically valid sampling and best practices By conducting 12 CRI reviews, 111 other reviews would be eliminated Significant cost savings for guarantors and trading partners

17. 16 CRI – Current Participants The following guarantors have signed CRI Participation Agreements: American Education Services American Student Assistance Colorado Student Loan Program Connecticut Student Loan Foundation Education Assistance Corporation Educational Credit Management Corporation Florida Department of Education

18. 17 CRI – Current Participants Other agencies participating are: Great Lakes Higher Education Corporation Illinois Student Assistance Commission Iowa College Student Aid Commission Kentucky Higher Education Assistance Authority Louisiana Office of Student Financial Assistance Michigan Higher Education Assistance Authority Missouri Student Assistance Resource Services Montana Guaranteed Student Loan Program

19. 18 CRI – Current Participants Other agencies participating are: National Student Loan Program New Mexico Student Loan Guarantee Corporation New Jersey Higher Education Student Assistance Authority Northwest Education Loan Association Oklahoma Guaranteed Student Loan Program Oregon Student Assistance Commission Student Loan Guarantee Foundation of Arkansas

20. 19 CRI – Current Participants Other agencies participating are: Student Loans of North Dakota Tennessee Student Assistance Commission Texas Guaranteed Student Loan Corporation USA Funds Utah Higher Education Assistance Authority Vermont Student Assistance Corporation

21. 20 CRI – The Future Bring additional guarantors into the CRI process Additional training for CRI review team members Work with ED to demonstrate effectiveness of CRI reviews Hopefully obtain permanent ED approval of CRI

22. 21 Common Review Initiative Questions?