Sallie Mae (SLM) tumbled 12 percent to a new low Wednesday after the struggling student lender posted a huge fourth-quarter loss. The Reston, Va., company lost $1.6 billion, or $3.98 a share, for the quarter ended Dec. 31, reversing the year-ago profit of $18 million, or 2 cents a share. The latest quarter’s profits were wiped out by a $1.5 billion mark-to-market loss on a bad bet the company recently closed out on its own stock, and a $575 million addition to its provision for loan losses as more students default on their loans. The rising loan loss projections put Sallie in league with other big consumer lenders, ranging from Citi (C) and Bank of America (BAC) to Americredit (ACF).

CEO Albert Lord, who retook the reins at Sallie Mae late last year after watching a planned $25 billion private equity buyout collapse, continues to destroy shareholder value at every turn. Lord last summer turned down a reduced $50-a-share buyout offer in hopes of holding Sallie’s would-be buyers to an earlier agreement at $60 a share. With the stock trading Wednesday just above $16, that decision isn’t looking terribly wise. Neither is Lord’s move last month to end a conference call with an expletive-laced tirade. Even so, he indicates that Sallie’s problems have been largely beyond the control of its exceptionally poor leadership.

“We faced significant distractions in 2007,” he said in Wednesday’s earnings release, “but we have taken several of the necessary steps to position the company for a return to strong, quality asset and earnings growth. … In 2008 and beyond, our market leadership position will continue to grow together with the demand for higher education.” Don’t expect to see Sallie Mae growing until it gets a CEO with a better grip on reality.

Sallie Mae (SLM) investors got some good news for a change. The struggling student lender said Monday it’s stripping CEO Albert Lord of the executive chairman job he took on a month and a half ago. The news sent Sallie’s deeply depressed shares up 13 percent in heavy trading.

While Lord will stay on as CEO and become a vice chairman, Sallie Mae named longtime banking-industry exec Tony Terracciano chairman and hired former Sallie exec Jack Remondi as another vice chairman. The shakeup comes after a disastrous December in which Sallie shares lost 47 percent of their value, as the company was forced to raise nearly $3 billion to close out a bad stock-market bet and rebuild its capital base. The lowlight of the month was a damaging conference call that ended with Lord declining to answer questions and telling his chief flack that it was time to “get the [expletive] out of here.”

Some observers have already begun a countdown to the day Lord does the same. In the meantime, he’s busy cooking up lame excuses for his unusually brief run as chairman.  “When I asked the Board to consider returning to a split of the chairman and chief executive positions,” Lord claims in the press release, “Tony was the logical choice to lead the Board.” Sallie goes on to note that it “has a 35-year history of separating the Board chair and chief executive roles, with the exception of the recent three-week period during which Mr. Lord held both positions.” It just so happens those were the worst three weeks in the company’s history.

Sallie Mae (SLM) is getting crushed again. Shares of the student lender hit a new low in morning trading while the company conducted a teleconference with investors. No word yet on exactly what recently reinstated CEO Albert Lord said, but the company promised Monday that he would discuss Sallie’s botched buyout attempt and “provide a broad outlook for 2008.” Sallie last week cut its profit forecast, so it’s not clear how much more detail investors can expect on that front. (Update: Lord said rising borrowing costs are belting Sallie’s bottom line, Bloomberg reports.)

One area in which Sallie clearly could do better, though, is in disclosing Lord’s stock sales. The Wall Street Journal reports that a recent Sallie Mae press release understated the amount of stock Lord was selling and overstated the amount of stock he continues to hold. The company said in restoring Lord’s CEO title last week that he brings “stability of leadership and vision,” but it’s becoming clear that his leadership is deeply flawed.

Sallie Mae (SLM) can’t stop sinking. The student lender slashed its full-year profit outlook Wednesday and shook up its sales team, citing rising funding costs and increased loan reserves. Sallie also tried to revive a buyout deal, to no effect. The firm said it has offered “to consider an alternative transaction” with the private equity-led group that signed up in the spring to buy Sallie before backing away as markets swooned. The group, led by J.C. Flowers, rejected Sallie’s offer, the company said.

Sallie was all set to be purchased by the Flowers group for $60 a share before the credit markets soured this past summer. After some wrangling, Flowers and his backers at Bank of America (BAC) and J.P. Morgan (JPM) then offered to buy Sallie for $50 a share, plus some stock warrants. Sallie rejected that too, righteously declaring it would sue the buyers to enforce the terms of the $60-a-share deal. Since then, however, it has become clear that this summer’s credit crunch is no passing fancy, and Sallie’s shares have plunged. They fetched less than $30 after Wednesday’s announcement, which nonetheless insisted that “underlying business drivers for the company are strong and executive management is strategically repositioning certain aspects of the business to allow for maximum growth and earnings opportunities.” By now, shareholders are surely considering “repositioning” Sallie chief C.E Andrews and chairman Albert Lord.