Slm Corporation · NASDAQ:SLM
Slm — Sallie Mae — 2014 Annual ABS East Conference
18 slides from Slm's conference presentation, September 2014
Slide 1: Sallie Mae ABS East Investor Presentation
SALLIE MAE ABS East Investor Presentation SEPTEMBER 2014
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements The following information is current as of September 15, 2014 (unless otherwise noted) and should be read in connection with SLM Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 (the “2014 Form 10-Q”), and the audite
Slide 3: The Sallie Mae Brand
The Sallie Mae Brand ► #1 saving, planning and paying for education company with 40-years of leadership in the education lending market ► Top ranked brand: 6 out of 10 consumers of education finance recognize the Sallie Mae brand ► Industry leading market share in private education lending; 52% mark
Slide 4: Sallie Mae Summary
Sallie Mae Summary Strategic Focus Consumer banking including leading private education loan franchise ► Largest Private Education Loan Originator Key Businesses ► Private Education Loan Servicing ► Deposits ► Upromise Rewards ► Insurance Services ► Credit Card Assets $11.4 Key Financial FFELP Loans
Slide 5: Sallie Mae Bank Investment Highlights
Sallie Mae Bank Investment Highlights Experienced management team ► Average of 30+ years of banking and financial services 1 with deep industry knowledge experience Leading brand in the education ► 40+ years serving the education lending market 2 lending market ► 52% private education lending market
Slide 6: Favorable Student Loan Market Trends
Favorable Student Loan Market Trends Enrollment at Four-Year Degree Granting Institutions Annual Cost of Education Public Private (millions) (thousands) 14.4 $41 $38 $39 13.5 13.5 13.7 $35 $36 13.3 $32 $34 12.9 $29 $30 12.1 $16 $17 $18 $18 $13 $14 $14 $15 $12 2008 2009 2010 2011 2012 2013 2017 2005
Slide 7: Higher Education Value Proposition
Higher Education Value Proposition Relationship Between Higher Education, Widening Earnings Gap of Young Adults by Most Graduates Say Income and Employment Educational Attainment College Has Paid Off 100,000 14% Has Not / Will Not $ 17,500 Pay Off 90,000 Average annual income $ 15,780 6% 12% Will Pa
Slide 8: High Quality Private Student Loan Originations Growth
High Quality Private Student Loan Originations Growth $4,500 $4,000 $4,000 $3,801 5% $3,345 14% $3,500 Originations ($MM) $3,000 22% $2,737 $2,500 $2,000 $1,500 $1,000 $500 $0 2011 2012 2013 2014 Private Education Loan Originations 8 8
Slide 9: Unique Smart Option Product Leads Private Education Lending Market
Unique Smart Option Product Leads Private Education Lending Market ► Smart Option student loan product first introduced in 2009 ► Offers three repayment options designed to help borrowers balance their goals and budget while in school – Interest Only: requires interest only payment during in-school
Slide 10: Attractive Customer Base
Attractive Customer Base ► 82% of customers from non-profit 4 year institutions Top tier schools ► 11% of customers from for profit 4 year institutions ► 78% of customers have FICOs >700 Strong credit history ► Average FICO of 746 at origination Co-signer involvement ► 90% of borrowers have co
Slide 11: High Quality Private Education Loan Portfolio
High Quality Private Education Loan Portfolio Portfolio by Product Smart Option Payment Type Graduate Signature / Other 1% 4% Interest Only Deferred 26% 46% Smart Option Fixed Pay 95% 28% 4Q 2013 Private Education Loans: $7.4bn 4Q 2013 Smart Option Loans: $7.1bn Portfolio by Vintage Customer FICO at
Slide 12: Smart Option Credit Outperforming
Smart Option Credit Outperforming ► Smart Option products outperform prior private education loan products due to more stringent underwriting standards and tailored product options ► Performance of newer vintage loans driven by focused marketing on high quality borrowers, better data and product man
Slide 13: Sallie Mae Bank ABS Program
Sallie Mae Bank ABS Program 13
Slide 14: Sallie Mae Legacy ABS Program
Sallie Mae Legacy ABS Program Sallie Mae, prior to the company separation, was one of the largest issuers of ABS globally, having issued over $250 billion in Private and FFELP ABS transactions In recent years, Sallie Mae was the predominant issuer of private education loan ABS Executed 3 trans
Slide 15: Bank ABS Funding Plans
Sallie Mae Bank ABS Funding Plans 4Q 2013 Target ► Term funding / securitization will augment deposit funding for future growth Retail deposits — Retained experienced capital markets team Brokered deposits — Capacity to securitize $2.0-$3.0bn of private ABS/ABCP education loans on balance sheet in 2
Slide 16: Bank vs Legacy Sallie Mae ABS Structures
Sallie Mae Bank vs Legacy Sallie Mae ABS Structures SMB 2014-A SLM 2014-A Size $382MM $676MM Pricing Date July 30, 2014 February 25, 2014 Collateral Smart Option Smart Option and Legacy Sallie Mae Private Education Loans Private Education Loans Overcollateralization (1) 12% 16% Prepayment Speed (2)
Slide 17: Legacy Sallie Mae vs Sallie Mae Bank Private Education Loan ABS Comparison
Legacy Sallie Mae vs Sallie Mae Bank Private Education Loan ABS Comparison Legacy SLM Private Education Loan ABS SMB ABS 11-A 11-B 11-C 12-A 12-B 12-C 12-D 12-E 13-A 13-B 13-C 14-A 2014-A Total Bond Amount ($mil) 562 825 721 547 891 1,135 640 976 1,108 1,135 624 676 382 Initial AAA Enhancement (%) 2
Slide 18: For more information visit: www.salliemae.com/investors
Sallie Mae Investor Relations Website For more information visit: www.salliemae.com/investors 18