Sallie Mae named Pete Graham, a veteran financial executive who was most recently CFO of the PRA Group and who previously also worked at GE Capital, to succeed Steve McGarry, the student lender’s long-time CFO, according to a Monday release.
The Newark, Delaware-based company entered a retention agreement earlier this year with McGarry, who has served nine years as its finance chief, under which the outgoing executive would have remained in the CFO position until retiring in February to help with the transition. Instead, the CFO swap will occur on Oct. 27 and McGarry will remain with the company until retirement as executive vice president.
Graham, who is joining the company as millions of borrowers of federal student loan borrowers must resume payments in October after the pandemic freeze, said in a statement that he was “thrilled” to join a team that would both serve students and families while also driving growth and long-term value for shareholders. “Like so many families that Sallie Mae serves, access to higher education was pivotal to my unique journey and I feel a particularly deep connection to the company’s mission,” he said.
For the past seven years Graham, 57, has been CFO of the Norfolk, Virginia-based PRA, a non-performing debt acquirer and collector. In a statement, PRA CEO Vikram Atal credited Graham with modernizing the debt collector’s financial operations, issuing over $1 billion in senior notes and creating an improved risk management framework for managing interest rate and foreign currency risk.
Prior to PRA, Graham worked from 2002 to 2016 at GE Capital in various roles of “increasing responsibility,” including as CFO of its GE Commercial Distribution Finance and earlier as CFO for GE Capital Markets, according to a Securities and Exchange Commission filing Monday. Earlier in his career, he led audit and advisory teams serving financial services industry clients.
Graham’s compensation includes a $580,000 annual base salary. He is eligible to receive a pro-rated 2023 target annual bonus of 150% and he will receive a one-time cash sign-on bonus of $460,000 as well as a one-time sign on equity grant of 850,000 comprised of restricted stock units subject to vesting, according to the filing.
The unfreezing of the $1.6 trillion federal student loan program may be confusing time for student borrowers, many of whom are learning about new payment schedules from loan services they don’t know because nearly half of borrowers’ loans were transferred to new servicers since the relief began in March 2020, according to a Wall Street Journal report citing government data. The first step in the restarting of the federal student-loan borrower program will get underway Friday when borrowers start accruing interest, according to a Sallie Mae blog.