PHEAA Exploring Options Regarding Outstanding Auction Rate Securities

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Harrisburg, PA (October 1, 2010)—Pennsylvania Higher Education Assistance Agency ("PHEAA") announced today that it is exploring options to restructure all or a portion of its outstanding auction rate securities, Student Loan Revenue Bonds, Senior and Subordinate Series A through NN (the "Bonds"). PHEAA has hired Morgan Stanley to assist in exploring its options. PHEAA has not initiated any restructuring transaction.

This announcement does not constitute the commencement of any restructuring transaction with respect to any Bonds. Any such transaction would be accompanied by a future announcement, which would include additional information about the terms of the particular transaction and where to find further information.

There should be no assumption that this process will result in any restructuring transaction.


Created in 1963 by the Pennsylvania General Assembly, PHEAA is dedicated to improving higher education opportunities for Pennsylvanians. PHEAA is a public corporation and government instrumentality of the Commonwealth of Pennsylvania. PHEAA serves students and schools nationally through its state grant, guaranty, servicing, and financial aid processing systems. Further information about PHEAA can be obtained at

Forward-Looking Statements

This press release, and other statements that PHEAA may make, may contain forward-looking statements. Forward-looking statements are typically identified by the words or phrases such as "trend," "potential," "opportunity," "believe," "expect," "anticipate," "intention," "estimate," "assume," "continue," "maintain," "seek," and similar expression, or future or conditional verbs such as "will," "would," "should," "could," "may" or similar expressions.

These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict and change over time. Forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what is expressed or forecast in these forward-looking statements.

Forward-looking statements speak only as of the date made. PHEAA undertakes no obligation to update any forward-looking statements to reflect the events or circumstances arising after the date as of which they were made. As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on the forward-looking statements included in this press release or that may be made elsewhere from time to time by, or on behalf of, PHEAA.