Slide 1: SLM Corporation Earnings Presentation Third-Quarter 2015
SLM CORPORATION EARNINGS PRESENTATION THIRD-QUARTER 2015 OCTOBER 22, 2015 1 1
Slide 2: Forward-Looking Statements and Disclaimer
Forward-Looking Statements and Disclaimer Cautionary Note Regarding Forward-Looking Statements The following information is current as of October 21, 2015 (unless otherwise noted) and should be read in connection with the press release of SLM Corporation (the “Company”) announcing its financial resu
Slide 3: Sallie Mae Bank Overview
Sallie Mae Bank Overview Sallie Mae Bank Key Portfolio Statistics for Q3 2015 − Portfolio of $10.8 billion of high quality Private Education Loans − 90% of Private Education Loans are cosigned − Average Private Education Loan Originations FICO of 749 − 79% of Private Education Loans have a FICO ≥ 70
Slide 4: Key Financial Metrics
Key Financial Metrics Q3 2015 Q2 2015 Q3 2014 ($Millions) Private Education Loans, Net $ 10,767 $ 9,245 $ 7,779 Net Interest Income $ 175 $ 168 $ 144 Net Interest Margin 5.36% 5.49% 5.25% Private Education Yield 7.87% 7.96% 8.20% Cost of Funds 1.20% 1.17% 1.07% Operating Expenses $ 93 $ 90 $ 73 Rest
Slide 5: High Quality Private Education Loan Originations Growth
High Quality Private Education Loan Originations Growth $5,000 $4,500 $4,300 $4,076 5% $4,000 $3,795 7% $3,756 7% $3,500 $3,342 14% YTD Originations ($MM) $3,000 $2,737 22% $2,500 $2,000 $1,500 $1,000 $500 $0 2011 2012 2013 2014 2015 Private Education Loan Originations Originations Statistics ($) Q3
Slide 6: Private Education Loan Delinquencies
Private Education Loan Delinquencies1,2,3 3Q 2015 2Q 2015 3Q 2014 ($ Thousands) Balance % Balance % Balance % Loans in repayment and percentage of each status: Loans current 6,529,855 98.1% 5,570,389 98.3% 4,515,313 98.7% Loans delinquent 31-60 days 79,794 1.2% 57,884 1.0% 44,082 1.0% Loans delinque
Slide 7: Delinquency and Default Performance (As a % of Loans in P&I Repayment)
Delinquency and Default Performance (As a % of Loans in P&I Repayment)4,5 10.0% 31-60 Day Delinquency 10.0% 61-90 Day Delinquency % of P&I Repayment Balance % of P&I Repayment Balance 8.0% 8.0% 6.0% 6.0% 4.0% 4.0% 2.0% 2.0% 0.0% 0.0% Legacy SLM: 31-60 Delinquency SLM Bank: 31-60 Delinquency Legacy S
Slide 8: Earnings Metrics
Earnings Metrics6 Q3 2015 Q2 2015 Q3 2014 ($Millions, except per share amounts) GAAP Net Income $ 46 $ 91 $ 83 GAAP Net Income Diluted EPS 0.09 0.20 0.18 Hedge Effectiveness Adjustment 1 - (4) "Core Earnings" 47 91 79 "Core Earnings" Diluted EPS 0.10 0.20 0.17 Core ROA 1.3% 2.8% 2.7% Core ROCE 11.7%
Slide 9: 2015 Guidance
2015 Guidance Target 2015 Originations $4.3 Billion Operating Expenses $353 Million Additional Restructuring Expense $7 Million Provision for Loan Losses, Private $83 Million “Core Earnings” diluted EPS $0.58 9
Slide 10: Footnotes
Footnotes 1 For this slide, “Loans in Repayment” include loans making interest only and fixed payments as well as loans that have entered full principal and interest repayments status. 2 Loans in forbearance include loans for customers who have requested extension of grace period generally during em
Slide 11: Important Information Regarding Historical Loan Performance Data
Important Information Regarding Historical Loan Performance Data On April 30, 2014 (the “Spin-Off Date”), the former SLM Corporation legally separated (the “Spin-Off”) into two distinct publicly traded entities: an education loan management, servicing and asset recovery business called Navient Corpo
Slide 12: Important Information Regarding Historical Loan Performance Data (cont.)
Important Information Regarding Historical Loan Performance Data (cont.) Smart Option Loan Portfolio Data for Charts on Page 7 of Presentation Legacy SLM Consolidated Smart Option Student Loan Portfolio Data prior to the Spin-Off Date, and Sallie Mae Bank-Only Smart Option Student Loan Data from and
Slide 13: "Core Earnings" to GAAP Reconciliation
“Core Earnings” to GAAP Reconciliation Quarters Ended Nine Months Ended (Dollars in thousands, except per share amounts) Sept 30, June 30, Sept 30, Sept 30, Sept 30, 2015 2015 2014 2015 2014 “Core Earnings” adjustments to GAAP: GAAP net income attributable to SLM Corporation….…….…..……….…….........……