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1Confidential and proprietary information. © 2024 Sallie Mae Bank. All rights reserved. Earnings Presentation 4th Quarter & Full-Year 2024
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2 Confidential and proprietary information. © 2024 Sallie Mae Bank. All rights reserved. 2 The following information is current as of January 23, 2025 (unless otherwise noted) and should be read in connection with the press release of SLM Corporation announcing its financial results for the quarter and year ended December 31, 2024, furnished to the Securities and Exchange Commission (“SEC”) on January 23, 2025, and subsequent reports filed with the SEC. This Presentation contains “forward-looking statements” and information based on management’s current expectations as of the date of this Presentation. Statements that are not historical facts, including statements about the Company’s (as hereinafter defined) beliefs, opinions, or expectations and statements that assume or are dependent upon future events, are forward-looking statements. These include, but are not limited to: strategies; goals and assumptions of SLM Corporation and its subsidiaries, collectively or individually as the context requires (the “Company”); the Company’s expectation and ability to execute loan sales and share repurchases; statements regarding future developments surrounding COVID-19 or any other pandemic, including, without limitation, statements regarding the potential impact of any such pandemic on the Company’s business, results of operations, financial condition, and/or cash flows; the Company’s expectation and ability to pay a quarterly cash dividend on our common stock in the future, subject to the approval of our Board of Directors; the Company’s 2025 guidance; the Company’s three-year horizon outlook; the impact of acquisitions we have made or may make in the future; the Company’s projections regarding originations, net charge-offs, non-interest expenses, earnings, balance sheet position, and other metrics; any estimates related to accounting standard changes; and any estimates related to the impact ofcredit administration practices changes, including the results of simulations or other behavioral observations. Forward-looking statements are subject to risks, uncertainties, assumptions, and other factors, many of which are difficult to predict and generally beyond the control of the Company, which may cause actual results to be materially different from those reflected in such forward-looking statements. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. The Company cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. These factors include, among others, the risks and uncertainties set forth in Item 1A. “Risk Factors” and elsewhere in the Company’s most recently filed Annual Report on Form 10-K and subsequent filings with the SEC; the societal, business, and legislative/regulatory impact of pandemics and other public heath crises; increases in financing costs; limits on liquidity; increases in costs associated with compliance with laws and regulations; failure to comply with consumer protection, banking, and other laws or regulations; our ability to timely develop new products and services and the acceptance of those products and services by potential and existing customers; changes in accounting standards and the impact of related changes in significant accounting estimates, including any regarding the measurement of our allowance for credit losses and the related provision expense; any adverse outcomes in any significant litigation to which the Company is a party; credit risk associated with the Company’s exposure to third parties, including counterparties to the Company’s derivative transactions; the effectiveness of our risk management framework and quantitative models; and changes in the terms of education loans and the educational credit marketplace (including changes resulting from new laws and the implementation of existing laws). We could also be affected by, among other things: changes in our funding costs and availability; reductions to our credit ratings; cybersecurity incidents, cyberattacks, and other failures or breaches of our operating systems or infrastructure, including those of third-party vendors; damage to our reputation; risks associated with restructuring initiatives, including failures to successfully implement cost-cutting programs and the adverse effects of such initiatives on our business; changes in the demand for educational financing or in financing preferences of lenders, educational institutions, students, and their families; changes in law and regulations with respect to the student lending business and financial institutions generally; changes in banking rules and regulations, including increased capital requirements; increased competition from banks and other consumer lenders; the creditworthiness of our customers, or any change related thereto; changes in the general interest rate environment, including the rate relationships among relevant money-market instruments and those of our earning assets versus our funding arrangements; rates of prepayments on the loans owned by us; changes in general economic conditions and our ability to successfully effectuate any acquisitions; and other strategic initiatives. The preparation of our consolidated financial statements also requires management to make certain estimates and assumptions, including estimates and assumptions about future events. These estimates or assumptions may prove to be incorrect. All oral and written forward-looking statements attributed to the Company are expressly qualified in their entirety by the factors, risks, and uncertainties set forth in the foregoing cautionary statements, and are made only as of the date of this Presentation or, where the statement is oral, as of the date stated. We do not undertake any obligation to update or revise any forward-looking statements to conform to actual results or changes in our expectations, nor to reflect events or circumstances that occur after the date on which such statements were made. In light of these risks, uncertainties, and assumptions, you should not put undue reliance on any forward-looking statements discussed. CAUTIONARY NOTE AND DISCLAIMER REGARDING FORWARD LOOKING STATEMENTS
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3 $107M GAAP net income attributable to common stock in Q4 2024. $0.50 Q4 2024 GAAP diluted earnings per common share. $2.68 Full-Year 2024 GAAP diluted earnings per common share. $590M GAAP net income attributable to common stock in Full-Year 2024. 5.19% Net interest margin for Full-Year 2024 and 4.92% net interest margin for Q4 2024. $637M Total operating expenses in Full- Year 2024, as compared to $619M in 2023. $148M total operating expenses in Q4 2024, as compared to $143M in the year- ago quarter. 4th Quarter & Full-Year 2024 Highlights $7.0B Private Education Loan Originations in Full-Year 2024, as compared to $6.4 billion in 2023. 10% Private Education Loan Originations growth in Full-Year 2024. 17% Private Education Loan Originations growth compared to year-ago quarter. 3.1% Full-Year 2024 Total Assets growth compared to 2023, inclusive of FFELP Loan portfolio sale. 5.7% Private Education Loan balance growth in Full- Year 2024 compared to 2023. $982M Private Education Loan Originations in Q4 2024, as compared to $839 million in the year-ago quarter. 12.6% Total risk-based capital ratio; CET1 capital ratio of 11.3%. $0.13 Common stock dividend per share paid in Q4 2024 $402M Capacity remaining under the 2024 Share Repurchase Program as of December 31, 2024. 11.6M Shares repurchased in Full-Year 2024 for $250M at an average share price of $21.59 per share. 2M shares repurchased in Q4 2024 for $46M. Balance Sheet & Capital Allocation Income Statement & Earnings Summary
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4 $108M Q4 2024 provision for credit losses; 5.83% total allowance as a percentage of the ending total loan balance plus unfunded commitments and total accrued interest receivable on Private Education Loans, compared with 5.89% in Q4 2023. 3.7% Percentage of Private Education Loans in repayment delinquent 30+ days as of 12/31/2024, as compared to 3.9% in 2023. $332M Private Education Loan net charge- offs for Full-Year 2024; 2.19% of average Private Educations loans in repayment, compared with 2.44% in 2023. 1.6% Percentage of Private Education Loans in an extended grace period for Q4 2024 (8) ; 0.9% of Private Education Loans in hardship and other forbearances in Q4 2024 (9) . $93M Private Education Loan net charge-offs for Q4 2024; 2.38% of average loans in repayment (annualized), compared with 2.43% in Q4 2023. Additional Key Performance Metrics Credit Performance Deposit portfolio balances at the end of Q4 2024 were 1.8% lower than at the end of Q3 2024; Q4 2024 mix of brokered vs. retail and other was approximately 45% and 55%, respectively. 3% Uninsured deposits as a percentage of total deposits as of 12/31/2024. $80M Unrealized losses on marketable securities portfolio as of 12/31/2024. 31 bps Approximate regulatory capital charge that would result if losses were realized. Funding & Liquidity Loan Sales $3.7B Private Education Loans at attractive premiums, including $3.4 billion of principal and $274 million in capitalized interest, sold in 2024.
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5 $5,321 $5,423 $5,975 $6,383 2020 2021 2022 2023 2024 87%748 56% 86%747 57% 86%750 59% Private Education Loan Trends Fourth-quarter 2024 originations at approximately $982 million, 17% higher than the year-ago quarter. Full-Year originations were approximately $7.0 billion, 10% higher than the prior year. Full-Year 2024 originations volume for graduate students increased 22% compared to full-year 2023. Average FICO at Approval(2) In School Payment Cosigned Private Education Loan Originations(1) + 10% + 7% + 10% 755 Average FICO at Approval(2) 58% In School Payment 88% Cosigned Q4 2024 750 Average FICO at Approval(2) 56% In School Payment 84% Cosigned Q4 2023 + 2% 86%749 60% $7,013 90%752 56%
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6 Q4 2024 Q3 2024 Q4 2023 Income Statement ($ Millions) Total interest income 661 653 669 Total interest expense 299 293 283 Net Interest Income 362 359 386 Less: provisions for credit losses 108 271 16 Total non-interest income 28 24 57 Total non-interest expenses 150 172 202 Income tax expense (benefit) 21 (14) 57 Net Income (Loss) 112 (45) 168 Preferred stock dividends 4 5 5 Net income (loss) attributable to common stock 107 (50) 164 Ending Balances ($ Millions) Private Education Loans held for investment, net 20,902 20,460 19,772 FFELP Loans held for investment, net - - 534 FFELP Loans held for sale, net - 486 - Deposits 21,069 21,445 21,653 Brokered 9,476 9,844 10,275 Retail and other 11,593 11,601 11,378 Q4 2024 Q3 2024 Q4 2023 Key Performance Metrics Net Interest Margin 4.92% 5.00% 5.37% Yield—Total Interest-earning assets 8.98% 9.07% 9.30% Private Education Loans 10.54% 10.79% 11.02% Cost of Funds 4.31% 4.35% 4.17% Return on Assets (“ROA”)(3) 1.5% (0.6)% 2.3% Return on Common Equity (“ROCE”)(4) 22.5% (10.2)% 40.2% Private Education Loan Sales $- $- $1,052 Per Common Share GAAP diluted earnings (loss) per common share $0.50 $(0.23) $0.72 Average common and common equivalent shares outstanding (millions) 215 215 227 Quarterly Financial Highlights
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7 2024 2023 Income Statement ($ Millions) Total interest income 2,619 2,592 Total interest expense 1,138 1,030 Net Interest Income 1,481 1,562 Less: provisions for credit losses 409 345 Total non-interest income 368 247 Total non-interest expenses 642 685 Income tax expense 190 197 Net Income 608 581 Preferred stock dividends 18 18 Net income attributable to common stock 590 564 Ending Balances ($ Millions) Private Education Loans held for investment, net 20,902 19,772 FFELP Loans held for investment, net - 534 Deposits 21,069 21,653 Brokered 9,476 10,275 Retail and other 11,593 11,378 2024 2023 Key Performance Metrics Net Interest Margin 5.19% 5.50% Yield—Total Interest-earning assets 9.17% 9.13% Private Education Loans 10.81% 10.86% Cost of Funds 4.25% 3.85% Return on Assets (“ROA”)(3) 2.1% 2.0% Return on Common Equity (“ROCE”)(4) 31.3% 35.8% Private Education Loan Sales $3,692 $3,154 Per Common Share GAAP diluted earnings per common share $2.68 $2.41 Average common and common equivalent shares outstanding (millions) 220 234 Full-Year Financial Highlights
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8 Credit Performance (5)(6)(7) Private Education Loans Held for Investment * Total allowance for credit losses represents the sum of the allowance for Private Education Loans and the allowance for unf unded loan commitments. ($ Thousands) Balance % Balance % Balance % Loans in repayment and percentage of each status: Loans current 15,513,333$ 96.3% 14,806,983$ 96.4% 14,809,271$ 96.1% Loans delinquent 30-59 days 310,748$ 1.9% 285,471$ 1.8% 298,751$ 1.9% Loans delinquent 60-89 days 140,735$ 0.9% 149,098$ 1.0% 151,017$ 1.0% Loans 90 days or greater past due 141,935$ 0.9% 118,703$ 0.8% 150,775$ 1.0% Total private education loans in repayment 16,106,751$ 100.0% 15,360,225$ 100.0% 15,409,814$ 100.0% Delinquencies as % of loans in repayment 3.7% 3.6% 3.9% Loans in forbearance 405,430$ 301,414$ 324,039$ Percentage of loans in forbearance: Percentage of loans in an extended grace period(8) 1.6% 0.9% 1.1% Percentage of loans in hardship and other circumstances(9) 0.9% 1.0% 1.0% 5.83% 5.84% 5.89% Net charge-offs as a % of average loans in repayment (annualized) 2.38% 2.08% 2.43% Total allowance for credit losses* as a percentage of the ending total loan balance plus unfunded loan commitments and total accrued interest receivable on Private Education Loans DEC 31, 2023 Quarters Ended DEC 31, 2024 SEP 30, 2024
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9 Factors affecting the Provision for Credit Losses 4th Quarter 2024 Allowance for Credit Losses Consolidated Statements of Income – Provision for Credit Losses Reconciliation • Provision was impacted by both originations volume, as well as the timing of disbursements. Total originations in Q4 2024 increased 17% compared to the year-ago quarter. New unfunded commitments in Q4 2024, net of expired commitments unused, increased 18% compared to the year-ago quarter. 9 Quarter Ended December 31, 2024($ THOUSANDS) Private Education Loan provision for credit losses: Provision for loan losses 80,533$ Provision for unfunded loan commitments 27,646 Provisions for credit losses reported in consolidated statements of income 108,179$
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10 2025 Guidance* For the full year 2025, the Company expects: $3.00 - $3.10 GAAP Diluted Earnings Per Common Share 6% - 8% Private Education Loan Originations Year-over-Year Growth 2.0% - 2.2% Total Loan Portfolio Net Charge-Offs as a Percentage of Average Loans in Repayment $655 - $675 million Non-Interest Expenses * The 2025 Guidance and related comments constitute forward-looking statements and are based on management’s current expectations and beliefs. There can be no guarantee as to whether and to what extent this guidance will be achieved. The Company undertakes no obligation to revise or release any revision or update to these forward-looking statements. See our Forward-Looking Statements disclosures on pg. 2 for more information.
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Confidential and proprietary information. © 2024 Sallie Mae Bank. All rights reserved. 11 1. Originations represent loans that were funded or acquired during the period presented. 2. Represents the higher credit score of the cosigner or the borrower. 3. We calculate and report our Return on Assets (“ROA”) as the ratio of (a) GAAP net income (loss) numerator (annualized) to (b) the GAAP total average assets denominator. 4. We calculate and report our Return on Common Equity (“ROCE”) as the ratio of (a) GAAP net income (loss) attributable to SLM Corporation common stock numerator (annualized) to (b) the net denominator, which consists of GAAP total average equity less total average preferred stock. 5. For purposes of this slide, loans in repayment include loans making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period (but do not include those loans while they are in forbearance). 6. For purposes of this slide, loans in forbearance include loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. 7. The period of delinquency is based on the number of days scheduled payments are contractually past due. 8. We calculate the percentage of loans in an extended grace period as the ratio of (a) Private Education Loans in forbearance in an extended grace period numerator to (b) Private Education Loans in repayment and forbearance denominator. An extended grace period aligns with The Office of the Comptroller of the Currency definition of an additional, consecutive, one-time period during which no payment is required for up to six months after the initial grace period. We typically grant this extended grace period to customers who may be having difficulty finding employment before the full principal and interest repayment period starts or once it has begun. 9. We calculate the percentage of loans in hardship and other forbearances as the ratio of (a) Private Education Loans in hardship and other forbearances (excluding loans in an extended grace period) numerator to (b) Private Education Loans in repayment and forbearance denominator. If the customer is in financial hardship, we work with the customer and/or cosigner and identify any available alternative arrangements designed to reduce monthly payment obligations, which may include a short-term hardship forbearance. Footnotes