When a big public company spins off a division, that is sometimes very good for shareholders. In the case of SLM Corp. (SLM) - better known as Sallie Mae, the student loan giant - it might not get a high grade.

U.S. borrowers owe $1.2 trillion in student-loan debt, including government loans and those from private lenders such as SLM. That surpasses all other kinds of consumer borrowing except for mortgages.

The Newark, Del.-based outfit won't be adding a lot of shareholder value in this transaction, according to a Monday research report issued by the often-bullish brokerage firm Janney Montgomery Scott. Sallie Mae announced late Friday details of its planned split next year, in which it will spin off an entity known as NewCo. It houses Sallie Mae's portfolio of federal and private student loans and its collections and servicing business.

The remaining entity, SLM BankCo, will consist of Sallie Mae Bank and will originate private student loans. The spin is expected to be complete by the end of the first half of 2014, according to Janney analyst Sameer Gokhale.

Sallie Mae shareholders will receive one share each of NewCo and SLM BankCo for each share of Sallie Mae they own. Janney doesn't think the new entities are worth that much more than the current stock price (SLM closed Monday at $26.66), with the analyst raising the estimate for the value of SLM BankCo, but offsetting that by a lower valuation for NewCo.

Basically, Janney raised its estimate for the stock price to $28 from $27 a share. For a full copy of the report, go to www.inquirer.com/janneyslm.

A Roth in 2013

Dave Littell, retirement income program director at the American College in Bryn Mawr, reminds investors that if you want to convert your traditional IRA to a Roth IRA, do it before the end of the year.

New contributions can be made to IRAs and Roth IRAs by April 15, 2014, and still be counted as a 2013 contribution. But what many investors are not aware of is that a Roth conversion from a traditional IRA must occur by Dec. 31, 2013, to count as 2013 Roth contributions.