Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

On June 4, 2009, The Student Loan Corporation (the Company) received its initial funding from the placement of Federal Family Education Loan (FFEL) Program loans under the U.S. Department of Education sponsored conduit, Straight-A Funding, LLC (the Conduit). The funding transaction settled today in the amount of $3.8 billion. Approximately $7 billion of the Company's FFEL Program loan portfolio remains eligible for future funding under the Conduit.

The Conduit provides additional liquidity support to the Company via the creation of a multi-seller asset-backed commercial paper conduit that purchases Stafford/PLUS loans first disbursed on or after October 1, 2003 and before July 1, 2009. Purchases of loans from lenders are funded indirectly through the sale of asset-backed commercial paper to private investors. The Conduit is supported by a liquidity facility provided by the Federal Financing Bank and an agreement with the U.S. Department of Education to purchase loans from the Conduit in order to allow the Conduit to repay funds borrowed from the Federal Financing Bank, to the extent required. The Company expects this facility to provide an attractively priced alternative source of funding, which will be largely based on pricing the Conduit receives from the issuance of asset-backed commercial paper. The initial term of this funding is five years.