The largest lender by assets in the US, J. P. Morgan Chase & Co has said that is planning to get out of its student loans business.

Following the exit of the bank on 12 October, 2012, Wells Fargo & Co will be the only major financial institution in the US offering student loans. Several banks have been leaving the student loan market since Obama administration indicated that it is focusing on lending directly to the students. The share of banks in the 1 trillion student-loan market has contracted significantly in the country.

JPMorgan Chase & Co's decision comes at a time when the families are choosing government-backed loans that are generally cheaper and have more protections for the borrowers. Chase made just $200 million in student loans during the previous year compared to $6.9 billion recorded in 2008.

"We just no longer see meaningful growth in this market and have decided to invest our resources in our other business, like auto lending, where we do see some real future potential," said Trish Wexler, a JPMorgan Chase & Co. spokeswoman, in an interview. The bank had 12,500 customers with Chase student loans out of the total of 56 million customers.