OKLAHOMA CITY (AP) - With credit markets tightening banks are dropping out of a program to provide college loans while applications for the loans have risen by 34 percent since July.
The Oklahoma Student Loan Authority says it's processed nearly 56,000 loan applications in the past six months compared to less than 42,000 during the same period last year.
The OSLA has 17 banks in its lending network down from a high of 42 last year.
OSLA president James Farha says the authority will continue making student loans despite the withdrawal of the banks and the volatility of the credit market.
He says a federal restriction limiting a bank's profitability has driven many banks out of the program.
But he says Congress recently guaranteed there will be access to money through 2010 to continue to assist college students.
(Copyright 2008 by The Associated Press. All Rights Reserved.)