Slide 1: Investor Presentation 4th Quarter & Full-Year 2024
Investor Presentation 4th Quarter & Full-Year 2024 Confidential and proprietary information. © 2024 Sallie Mae Bank. All rights reserved. 1
Slide 2: Cautionary Note and Disclaimer Regarding Forward Looking Statements
CAUTIONARY NOTE AND DISCLAIMER REGARDING FORWARD LOOKING STATEMENTS 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
Slide 3: 4th Quarter & Full-Year 2024 Highlights
Balance Sheet & Capital Allocation $7.0B 10% 4th Quarter & Private Education Loan Private Education Loan Originations Originations in Full-Year 2024, growth in Full-Year 2024. 17% Full-Year 2024 as compared to $6.4 billion in Private Education Loan Originations 2023. growth compared to year-ago High
Slide 4: Additional Key Performance Metrics
Loan Sales Funding & Liquidity Additional Key Performance $3.7B Deposit portfolio balances at the end of Q4 2024 were 1.8% 3% Metrics Private Education Loans at attractive premiums, including lower than at the end of Q3 2024; Uninsured deposits as a Q4 2024 mix of brokered vs. retail and percentage
Slide 5: A Compelling Investment Opportunity
A Compelling Outstanding financial track record with strong Investment EPS performance and ROCE Opportunity Well-positioned in large and growing private student loan market, with powerful brand recognition and attractive client base Consistent profitability, balance sheet strength and strong risk an
Slide 6: Sallie Mae is an Outstanding Franchise
Sallie Mae is an 64% Outstanding Franchise 2024 full-year market share of private student lending marketplace(3) Sallie Mae is the market-leading brand for private education loans driven by brand recognition, rigorous underwriting methodology and industry-leading customer service. 58% In School Paym
Slide 7: Providing Customers with Financial Backing, Information and Tools to Achieve Their Goals
SLM Portfolio Providing Customers with Financial Backing, Information and Tools to Achieve Their Goals PRIVATE Smart Option SALLIE Offers traditional savings EDUCATION Student Loans MAE products LOANS Emphasize in-school BANK • High-yield savings accounts payment features that can • Money market acc
Slide 8: Private Education Loan Portfolio
Originations Vintage Smart Option Payment Type (7) Private 2% 23% 2% 2024 Pre 2014 18% Education 2014 3% Interest Only 2015 4% 47% Loan 2016 Deferred 4% Portfolio 2017 24% $22.2B 4% $19.6B 2023 Loans 2018 Loans 5% 2019 35% Fixed Pay 6% 2020 14% 9% 2022 2021 High Quality Private Education Loan Portfo
Slide 9: Sallie Mae's Smart Option Loan
Sallie Mae’s Smart Option Loan The Smart Option Loan product, introduced in 2009, consists of: Interest Only loans Fixed Pay loans Deferred loans • Smart Option payment option may Require full interest Require $25 fixed Do not require payments not be changed after selected at payments during in-scho
Slide 10: More Personalized, Flexible Financing Options that Set Students Up for Success
More Personalized, Flexible Financing Options that Set Students Up for Success Medical General Studies Sallie Mae Federal Student Loan Program Federal Direct Loan Loan Program Smart Option Student Loan Parent Plus (Subsidized & Unsubsidized) Dental Yr. 1 - $5,500 ($3,500 > subsidized) Undergraduate
Slide 11: Our Proven Strategy Aims to Maximize the Profitability and Growth of the Core Business
Our Proven Strategy Aims to Maximize the Profitability and Growth of the Core Business STRATEGIES TO MAXIMIZE REVENUE STRATEGIES TO MANAGE UNIT COSTS Drive penetration at all schools Maintain strong focus on fixed cost discipline Increase market share by bridging gaps in Drive towards reducing both
Slide 12: Optimize the Value of the Brand and Attractive Client Base
Optimize the Value of the Brand and Attractive Client Base WHAT Ensure products and services are Build products and services that Prioritize partnerships Look for opportunities WE DO consistent with our core mission leverage our customer affiliation and other capital efficient to optimize ROI and dr
Slide 13: Enhancing Shareholder Value Through Disciplined Balance Sheet Growth and Strategic Capital Return
Enhancing Shareholder Value Through Disciplined Balance Sheet Growth and Strategic Capital Return(8) Strong Balance Expected to drive recurring Expected to support a consistent Sheet & Recurring revenue and lead to steady dividend with the potential for Earnings Growth double-digit earnings per futu
Slide 14: Consumers Increasingly Rely on Borrowed Funds to Finance the Cost of a Higher Education
Roughly Half of Consumers Increasingly Rely Families USED BORROWED FUNDS on Borrowed Funds to Finance IN AY 2023-24 the Cost of a Higher Education Families’ out-of-pocket contributions covered half of college costs of costs covered by families’ 48% out-of-pocket contributions of costs covered by sch
Slide 15: Private Education Loan Trends
Private Private Education Loan Originations(11) Average FICO at Approval(6) In School Payment Cosigned Education Loan Trends 2024 $7,013 752 56% 90% Fourth-quarter 2024 originations at approximately $982 million, 17% higher than the year-ago quarter. + 10% Full-Year originations were approximately $
Slide 16: Diversified Funding Optimizes Net Interest Margin
Diversified Funding Optimizes Net Interest Margin Long-Term Funding Outstanding borrowings consist of unsecured debt and secured Funding Strategy borrowings issued through our term asset-backed securitization program, totaling approximately $1 billion and $5.4 billion, respectively, as of December 3
Slide 17: Improving Political Environment
A Focus on Federal Lending Improving Political Environment National policymakers are focused on addressing federal student lending issues and reform, including: • Federal loan forgiveness • Federal PLUS limits We believe the current environment • Enhanced federal repayment programs presents opportun
Slide 18: ABS Supplement
ABS Supplement 18
Slide 19: Sallie Mae Bank ABS Summary – Last 12 Quarters (On-Balance Sheet)
Sallie Mae Bank ABS Summary – Last 12 Quarters (On-Balance Sheet)* 22-C 23-A 23-C 24-C 24-E 24-F Issuance Date 8/9/2022 3/15/2023 8/16/2023 5/15/2024 8/14/2024 11/6/2024 Total Bond Amount ($mil) $575 $579 $568 $668 $868 $680 Initial AAA Enhancement (%) 22% 18% 19% 16% 15% 14% Initial Class B Enhance
Slide 20: Sallie Mae Bank ABS Structures
Sallie Mae Bank ABS Structures (6) 20
Slide 21: Appendix
Appendix 21
Slide 22: Quarterly Financial Highlights
Quarterly Financial Highlights Q4 Q3 Q4 Q4 Q3 Q4 2024 2024 2023 2024 2024 2023 Income Statement ($ Millions) Key Performance Metrics Total interest income 661 653 669 Net Interest Margin 4.92% 5.00% 5.37% Total interest expense 299 293 283 Net Interest Income 362 359 386 Yield—Total Interest-earning
Slide 23: Full-Year Financial Highlights
Full-Year Financial Highlights 2024 2023 2024 2023 Income Statement ($ Millions) Key Performance Metrics Total interest income 2,619 2,592 Net Interest Margin 5.19% 5.50% Total interest expense 1,138 1,030 Net Interest Income 1,481 1,562 Yield—Total Interest-earning assets 9.17% 9.13% Less: provisio
Slide 24: Credit Performance
Credit Performance (17)(18)(19) Private Education Loans Held for Investment Quarters Ended DEC 31, 2024 SEP 30, 2024 DEC 31, 2023 ($ 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
Slide 25: Allowance for Credit Losses
Allowance for Credit Losses Consolidated Statements of Income – Provision for Credit Losses Reconciliation Factors affecting the Provision for Credit Losses 4th Quarter 2024 Quarter Ended ($ THOUSANDS) December 31, 2024 • Provision was impacted by both Private Education Loan provision for credit los
Slide 26: Footnotes
Footnotes 1. 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 t