Slide 1: SLM Corporation Earnings Presentation Fourth-Quarter 2014
SLM CORPORATION EARNINGS PRESENTATION FOURTH-QUARTER 2014 JANUARY 22, 2015 1 1
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements The following information is current as of January 22, 2015 (unless otherwise noted) and should be read in connection with SLM Corporation’s press release announcing its financial results for the quarter and year ended December 31, 2014, and the a
Slide 3: Sallie Mae Bank Overview
Sallie Mae Bank Overview Sallie Mae Bank Key Portfolio Statistics for Q4 2014 − Portfolio of $8.2 billion of high quality Private Education Loans − 90% cosigned − Average Originations FICO of 748 − Nearly 80% of the loans have a FICO > 700 − 28% of loans are in full principal and interest repayment
Slide 4: Key Financial Metrics
Key Financial Metrics Q4 2014 Q3 2014 Q4 2013 2014 2013 ($Millions) Private Education Loans, Gross $ 8,311 $ 7,829 $ 6,563 $ 8,311 $ 6,563 Net Interest Income 151 144 122 578 462 Net Interest Margin 5.01% 5.25% 4.95% 5.26% 5.06% Private Education Yield 8.07% 8.20% 8.17% 8.16% 8.16% Cost of Funds 1.1
Slide 5: High Quality Private Education Loan Originations Growth
High Quality Private Education Loan Originations Growth $4,500 $4,076 $4,000 $3,795 7% $3,500 $3,342 14% Originations ($MM) $3,000 $2,737 22% $2,500 $2,000 $1,500 $1,000 $500 $0 2011 2012 2013 2014 Private Education Loan Originations Originations Statistics ($) Q4 2014 Q4 2013 2014 2013 % Cosigned 8
Slide 6: Q4 Private Education Loan Delinquencies
Q4 Private Education Loan Delinquencies 4Q 2014 4Q 2013 ($ Thousands) Balance % Balance % Loans in repayment and percentage of each status: Loans current 5,045,600 98.0% 3,933,143 99.0% Loans delinquent 31-60 days 63,873 1.2 28,854 0.7 Loans delinquent 61-90 days 29,041 0.6 10,280 0.3 Loans delinque
Slide 7: Portfolio Migrating to Full Principal and Interest Status
Portfolio Migrating to Full Principal and Interest Status Estimated Loss Emergence Curve – Loans in P&I1 % of Loans in Repayment % of Loans in Repayment 3% 3.0% 9% 2.5% 25% Interest Only/In School PERIODIC DEFAULT RATE 2.0% $25 Fixed/In School 1.5% <1 Year P&I 28% 1-2 Years P&I 1.0% 2+ Years P&I 0.5
Slide 8: Earnings Metrics
Earnings Metrics Q4 2014 Q3 2014 Q4 2013 2014 2013 ($Millions, except per share amounts) GAAP Net Income $ 20 $ 83 $ 60 $ 194 $ 259 GAAP Net Income Diluted EPS 0.03 0.18 0.14 0.42 0.58 Hedge Effectiveness Adjustment - (4) 1 1 - "Core Earnings" 20 79 61 195 259 "Core Earnings" Diluted EPS 0.03 0.17 0
Slide 9: 2015 Guidance
2015 Guidance Target 2015 Originations $4.3 Billion Operating Expenses $325 Million Additional Restructuring Expense $5 Million Loan Sales at 7.5% Premium $1.5 Billion Provision for Loan Losses, Private $116 - $130 Million “Core Earnings” diluted EPS $0.48-$0.50 9
Slide 10: Appendix
salieMae) APPENDIX
Slide 11: “Core Earnings” to GAAP Reconciliation
“Core Earnings” to GAAP Reconciliation Quarters Ended December 31, Years Ended December 31, (Dollars in thousands, except per share amounts) 2014 2013 2014 2013 “Core Earnings” adjustments to GAAP: GAAP net income attributable to SLM Corporation ......................................................