The six-month battle over the fate of the Sallie Mae buy-out ended on Monday when the troubled US student lender announced it had secured a $31bn financing package and settled its legal dispute with a consortium led by JC Flowers, the private equity group.

This month, Tony Terracciano, a veteran turnround expert in the financial services industry, was appointed to chairman of SLM, in an attempt to steer a new path for the company.