Slide 1: SLM Corporation Earnings Presentation First Quarter 2021
SLM Corporation Earnings Presentation First Quarter 2021 April 22, 2021
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 April 21, 2021 (unless otherwise noted) and should be read in connection with the press release of SLM Corporation (the “Company”) announcing its financial result
Slide 3: First quarter performance positive step towards 2021 targets
First quarter performance positive step towards 2021 targets Strengthening Economy • The average unemployment rate for the over 25 year-old college graduate population improved to 3.8% in Q1 2021 from 4.1% in Q4 2020. 15 • Early reports from colleges and universities indicate they are expecting an o
Slide 4: Clear Strategy to Ensure Appropriate Valuation
Clear Strategy to Ensure Appropriate Valuation Maximize the Optimize the value Better inform the Maintain a profitability and of our brand and external narrative rigorous and growth of our core our attractive about student predictable capital business client base lending and Sallie allocation and Ma
Slide 5: Maximize the Profitability and Growth of our Core Business
Maximize the Profitability and Growth of our Core Business Revenue • GAAP Net Income of $641 million in Q1 2021, compared to $362 million in Q1 2020. • Originated $2.1 billion in Private Education Loans in Q1 2021 (-10% vs. Q1 2020) due to the pandemic impacts on the market. Non-interest Expenses •
Slide 6: Quarterly Financial Highlights
Quarterly Financial Highlights3 1Q 4Q 1Q 1Q 4Q 1Q 2021 2020 2020 2021 2020 2020 Income Statement ($ Millions) Key Performance Metrics Total interest income $436 $480 $575 Total interest expense 105 113 175 Net Interest Margin 4.40% 4.82% 5.08% Net Interest Income 331 367 400 Yield—Total Interest-ear
Slide 7: Private Education Loan Originations
Private Education Loan Originations9 $6,000 $5,625 6% (5%) $5,500 $5,315 $5,321 11% $5,000 $4,800 $4,666 3% $4,500 $4,000 Originations ($MM) $3,500 $3,000 $2,500 (10%) $2,301 $2,065 $2,000 $1,500 $1,000 $500 $0 2016 2017 2018 2019 2020 2021 Actuals Originations Statistics Q1 2021 Q1 2020 Origination
Slide 8: Credit Performance
Credit Performance11,12,13,16 Private Education Loans Held for Investment Quarters Ended March 31, 2021 December 31, 2020 March 31, 2020 ($ Thousands) Balance % Balance % Balance % Loans in repayment and percentage of each status: Loans current $ 14,471,427 97.9% $ 13,898,948 97.2% $ 14,516,211 96.8
Slide 9: Provisions for Credit Losses Q1 2021
Provisions for Credit Losses Q1 2021 Consolidated Statements of Income 15 Provisions for Credit Losses Reconciliation Moody's College Graduate Age>25 Unemployment Forecast 5.00% Quarter Ended March 31, 2021 4.50% Private Education Loan provisions for credit losses: 4.00% Provisions for credit losses
Slide 10: Guidance
Guidance14 For the full-year 2021, the company expects the following: Metrics 2021 Full-Year Guidance GAAP diluted earnings per share $2.95-$3.15 Private Education Loan originations year- 6-7% over-year growth Total loan portfolio net charge-offs $ 260 million - $280 million Non-interest expenses $
Slide 11: Footnotes
Footnotes 1. Derivative Accounting: we provide “Core Earnings” because it is one of several measures management uses to evaluate management performance and allocate corporate resources. “Core Earnings” exclude periodic unrealized gains and losses caused by the mark-to-fair value valuations on deriva
Slide 12: Footnotes (continued)
Footnotes (continued) 15. Source based on U.S. Bureau of Labor Statistics (BLS): Current Population Survey (CPS); Moody's Analytics Forecasted. December Base- College based on Baseline Scenario (December 2020): Household Survey: Unemployment Rate: College Grads, (%, SA) (FLBRCG.IUSA) as of 12/07/202
Slide 13: Core Earnings to GAAP Reconciliation
“Core Earnings” to GAAP Reconciliation Quarters Ended Mar. 31, 2021 Dec. 31, 2020 Mar. 31, 2020 Dollars in thousands, except per share amounts “Core Earnings” adjustments to GAAP: GAAP net income $641,207 $432,700 $362,173 Preferred stock dividends $1,201 $1,734 $3,464 GAAP net income attributable t