Cover page
Cover page | 3 Months Ended |
Mar. 31, 2021shares | |
Entity Information [Line Items] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Mar. 31, 2021 |
Document Transition Report | false |
Entity File Number | 001-13251 |
Entity Registrant Name | SLM Corp |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 52-2013874 |
Entity Address, Address Line One | 300 Continental Drive |
Entity Address, City or Town | Newark, |
Entity Address, State or Province | DE |
Entity Address, Postal Zip Code | 19713 |
City Area Code | 302 |
Local Phone Number | 451-0200 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Smaller Reporting Company | false |
Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 328,351,576 |
Amendment Flag | false |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | Q1 |
Entity Central Index Key | 0001032033 |
Current Fiscal Year End Date | --12-31 |
Common Stock | |
Entity Information [Line Items] | |
Title of 12(b) Security | Common stock, par value $.20 per share |
Trading Symbol | SLM |
Security Exchange Name | NASDAQ |
Noncumulative Preferred Stock | |
Entity Information [Line Items] | |
Title of 12(b) Security | Floating Rate Non-Cumulative Preferred Stock, Series B, par value $.20 per share |
Trading Symbol | SLMBP |
Security Exchange Name | NASDAQ |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and cash equivalents | $ 6,207,001 | $ 4,455,292 |
Investments | ||
Trading investments at fair value (cost of $26,219 and $12,551) | 30,594 | 16,923 |
Available-for-sale investments at fair value (cost of $2,116,279 and $1,986,957, respectively) | 2,115,885 | 1,996,634 |
Other investments | 79,679 | 80,794 |
Total investments | 2,226,158 | 2,094,351 |
Loans held for investment (net of allowance for losses of $1,179,021 and $1,361,723, respectively) | 20,368,287 | 19,183,143 |
Loans held for sale | 0 | 2,885,640 |
Restricted cash | 164,708 | 154,417 |
Other interest-earning assets | 23,592 | 42,874 |
Accrued interest receivable | 1,264,960 | 1,387,305 |
Premises and equipment, net | 155,425 | 154,670 |
Income taxes receivable, net | 169,655 | 374,706 |
Tax indemnification receivable | 15,678 | 18,492 |
Other assets | 32,541 | 19,533 |
Total assets | 30,628,005 | 30,770,423 |
Liabilities | ||
Deposits | 22,803,143 | 22,666,039 |
Long-term borrowings | 4,918,670 | 5,189,217 |
Other liabilities | 297,728 | 352,332 |
Total liabilities | 28,019,541 | 28,207,588 |
Commitments and contingencies | ||
Equity | ||
Preferred stock | 251,070 | 251,070 |
Common stock, par value $0.20 per share, 1.125 billion shares authorized: 431.1 million and 456.7 million shares issued, respectively | 86,211 | 91,346 |
Additional paid-in capital | 1,052,904 | 1,331,247 |
Accumulated other comprehensive loss (net of tax benefit of ($7,680) and ($10,908), respectively) | (24,077) | (34,200) |
Retained earnings | 2,350,986 | 1,722,365 |
Total SLM Corporation stockholders’ equity before treasury stock | 3,717,094 | 3,361,828 |
Less: Common stock held in treasury at cost: 102.7 million and 81.4 million shares, respectively | (1,108,630) | (798,993) |
Total equity | 2,608,464 | 2,562,835 |
Total liabilities and equity | $ 30,628,005 | $ 30,770,423 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Trading investments, cost | $ 26,219 | $ 12,551 |
Available-for-sale investments, cost | 2,116,279 | 1,986,957 |
Allowance for credit losses on loans and leases | $ 1,179,021 | $ 1,361,723 |
Preferred stock, par or stated value (in dollars per share) | $ 0.20 | $ 0.20 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares outstanding (in shares) | 2,500,000 | 2,500,000 |
Preferred stock, liquidation preference (in dollars per share) | $ 100 | $ 100 |
Common stock, par value (in dollars per share) | $ 0.20 | $ 0.20 |
Common stock, shares authorized (in shares) | 1,125,000,000 | 1,125,000,000 |
Common stock, shares issued (in shares) | 431,100,000 | 456,700,000 |
Accumulated other comprehensive income, tax | $ (7,680) | $ (10,908) |
Treasury stock, shares (in shares) | 102,700,000 | 81,400,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Interest income: | ||
Loans | $ 431,804 | $ 555,277 |
Investments | 2,728 | 2,517 |
Cash and cash equivalents | 1,626 | 17,139 |
Total interest income | 436,158 | 574,933 |
Interest expense: | ||
Deposits | 66,598 | 135,112 |
Interest expense on short-term borrowings | 3,202 | 4,217 |
Interest expense on long-term borrowings | 35,244 | 35,488 |
Total interest expense | 105,044 | 174,817 |
Net interest income | 331,114 | 400,116 |
Less: provisions for credit losses | (225,767) | 61,258 |
Net interest income after provisions for credit losses | 556,881 | 338,858 |
Non-interest income: | ||
Gains on sales of loans, net | 399,111 | 238,935 |
Gains on derivatives and hedging activities, net | 28 | 45,672 |
Other income | 14,288 | 7,487 |
Total non-interest income | 413,427 | 292,094 |
Operating expenses | ||
Compensation and benefits | 71,581 | 84,222 |
FDIC assessment fees | 5,188 | 8,890 |
Other operating expenses | 47,730 | 54,186 |
Total operating expenses | 124,499 | 147,298 |
Restructuring expenses | 1,077 | 0 |
Total non-interest expenses | 125,576 | 147,298 |
Income before income tax expense | 844,732 | 483,654 |
Income tax expense | 203,525 | 121,481 |
Net income | 641,207 | 362,173 |
Preferred stock dividends | 1,201 | 3,464 |
Net income attributable to SLM Corporation common stock | $ 640,006 | $ 358,709 |
Basic earnings per common share attributable to SLM Corporation (in dollars per share) | $ 1.77 | $ 0.88 |
Average common shares outstanding (in shares) | 361,042,000 | 409,786,000 |
Diluted earnings per common share attributable to SLM Corporation (in dollars per share) | $ 1.75 | $ 0.87 |
Average common and common equivalent shares outstanding (in shares) | 366,240,000 | 412,755,000 |
Declared dividends per common share attributable to SLM Corporation (in dollars per share) | $ 0.03 | $ 0.03 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 641,207 | $ 362,173 |
Other comprehensive income (loss): | ||
Unrealized gains (losses) on investments | (10,071) | 4,803 |
Unrealized gains (losses) on cash flow hedges | 23,423 | (45,694) |
Total unrealized gains (losses) | 13,352 | (40,891) |
Income tax (expense) benefit | (3,229) | 9,984 |
Other comprehensive income (loss), net of tax (expense) benefit | 10,123 | (30,907) |
Total comprehensive income | $ 651,330 | $ 331,266 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Series B Preferred Stock | Cumulative Effect, Period Of Adoption, Adjustment | Cumulative Effect, Period Of Adoption, Adjusted Balance | Preferred Stock | Preferred StockCumulative Effect, Period Of Adoption, Adjusted Balance | Common Stock | Common StockCumulative Effect, Period Of Adoption, Adjusted Balance | Treasury Stock | Treasury StockCumulative Effect, Period Of Adoption, Adjusted Balance | Additional Paid-In Capital | Additional Paid-In CapitalCumulative Effect, Period Of Adoption, Adjusted Balance | Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss)Cumulative Effect, Period Of Adoption, Adjusted Balance | Retained Earnings | Retained EarningsSeries B Preferred Stock | Retained EarningsCumulative Effect, Period Of Adoption, Adjustment | Retained EarningsCumulative Effect, Period Of Adoption, Adjusted Balance |
Beginning Balance, issued (in shares) at Dec. 31, 2019 | 4,000,000 | 4,000,000 | 453,599,926 | 453,599,926 | ||||||||||||||
Beginning Balance (in shares) at Dec. 31, 2019 | 421,093,364 | 421,093,364 | (32,506,562) | (32,506,562) | ||||||||||||||
Beginning Balance at Dec. 31, 2019 | $ 3,311,836 | $ (952,639) | $ 2,359,197 | $ 400,000 | $ 400,000 | $ 90,720 | $ 90,720 | $ (324,659) | $ (324,659) | $ 1,307,630 | $ 1,307,630 | $ (12,367) | $ (12,367) | $ 1,850,512 | $ (952,639) | $ 897,873 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Net income | 362,173 | 362,173 | ||||||||||||||||
Other comprehensive loss, net of tax | (30,907) | (30,907) | ||||||||||||||||
Total comprehensive income | 331,266 | |||||||||||||||||
Dividends, Cash [Abstract] | ||||||||||||||||||
Common Stock | (12,595) | (12,595) | ||||||||||||||||
Preferred Stock | $ (3,464) | $ (3,464) | ||||||||||||||||
Dividend equivalent units related to employee stock-based compensation plans | $ 0 | 265 | (265) | |||||||||||||||
Issuance of common shares (in shares) | 2,837,562 | 2,837,562 | ||||||||||||||||
Issuance of common shares | $ 2,872 | $ 568 | 2,304 | |||||||||||||||
Stock-based compensation expense | $ 13,610 | 13,610 | 0 | |||||||||||||||
Common stock repurchased (in shares) | (47,736,847) | (47,736,847) | (47,736,847) | |||||||||||||||
Common stock repurchased | $ (558,167) | $ (461,244) | (96,923) | |||||||||||||||
Shares repurchased related to employee stock-based compensation plans (in shares) | (1,105,119) | (1,105,119) | (1,105,119) | |||||||||||||||
Shares repurchased related to employee stock-based compensation plans | $ (12,136) | $ (12,136) | ||||||||||||||||
Ending Balance, issued (in shares) at Mar. 31, 2020 | 4,000,000 | 456,437,488 | ||||||||||||||||
Ending Balance (in shares) at Mar. 31, 2020 | 375,088,960 | (81,348,528) | ||||||||||||||||
Ending Balance at Mar. 31, 2020 | 2,120,583 | $ 400,000 | $ 91,288 | $ (798,039) | 1,226,886 | (43,274) | 1,243,722 | |||||||||||
Beginning Balance, issued (in shares) at Dec. 31, 2020 | 2,510,696 | 456,729,251 | ||||||||||||||||
Beginning Balance (in shares) at Dec. 31, 2020 | 375,287,999 | (81,441,252) | ||||||||||||||||
Beginning Balance at Dec. 31, 2020 | 2,562,835 | $ 251,070 | $ 91,346 | $ (798,993) | 1,331,247 | (34,200) | 1,722,365 | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||
Net income | 641,207 | 641,207 | ||||||||||||||||
Other comprehensive loss, net of tax | 10,123 | 10,123 | ||||||||||||||||
Total comprehensive income | 651,330 | |||||||||||||||||
Dividends, Cash [Abstract] | ||||||||||||||||||
Common Stock | (10,906) | (10,906) | ||||||||||||||||
Preferred Stock | $ (1,201) | $ (1,201) | ||||||||||||||||
Dividend equivalent units related to employee stock-based compensation plans | $ (16) | 463 | (479) | |||||||||||||||
Issuance of common shares (in shares) | 2,826,387 | 2,826,387 | ||||||||||||||||
Issuance of common shares | $ 2,061 | $ 565 | 1,496 | |||||||||||||||
Stock-based compensation expense | 11,124 | 11,124 | ||||||||||||||||
Common stock repurchased and cancelled (in shares) | (28,502,460) | |||||||||||||||||
Common stock repurchased and cancelled | $ (471,810) | $ (5,700) | (466,110) | |||||||||||||||
Common stock repurchased (in shares) | (48,702,830) | (20,200,370) | (20,200,370) | |||||||||||||||
Common stock repurchased | $ (120,640) | $ (295,324) | 174,684 | |||||||||||||||
Shares repurchased related to employee stock-based compensation plans (in shares) | (1,059,980) | (1,059,980) | (1,059,980) | |||||||||||||||
Shares repurchased related to employee stock-based compensation plans | $ (14,313) | $ (14,313) | ||||||||||||||||
Ending Balance, issued (in shares) at Mar. 31, 2021 | 2,510,696 | 431,053,178 | ||||||||||||||||
Ending Balance (in shares) at Mar. 31, 2021 | 328,351,576 | (102,701,602) | ||||||||||||||||
Ending Balance at Mar. 31, 2021 | $ 2,608,464 | $ 251,070 | $ 86,211 | $ (1,108,630) | $ 1,052,904 | $ (24,077) | $ 2,350,986 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Declared dividends per common share attributable to SLM Corporation (in dollars per share) | $ 0.03 | $ 0.03 |
Series B Preferred Stock | ||
Preferred stock dividend (in dollars per share) | $ 0.48 | $ 0.87 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities | ||
Net income | $ 641,207 | $ 362,173 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Provisions for credit losses | (225,767) | 61,258 |
Income tax expense | 203,525 | 121,481 |
Amortization of brokered deposit placement fee | 4,307 | 5,193 |
Amortization of Secured Borrowing Facility upfront fee | 773 | 526 |
Amortization of deferred loan origination costs and loan premium/(discounts), net | 4,016 | 12,241 |
Net amortization of discount on investments | 2,161 | 610 |
Unrealized gain on investments | 0 | 1,191 |
Reduction (increase) in tax indemnification receivable | 2,814 | (169) |
Depreciation of premises and equipment | 3,715 | 3,855 |
Stock-based compensation expense | 11,124 | 13,610 |
Unrealized (gains) losses on derivatives and hedging activities, net | 10,872 | (43,195) |
Gains on sales of loans, net | (399,111) | (238,935) |
Other adjustments to net income, net | 2,578 | 1,574 |
Changes in operating assets and liabilities: | ||
Increase in accrued interest receivable | (183,168) | (236,282) |
Increase in non-marketable securities | (317) | 0 |
Decrease (increase) in other interest-earning assets | 19,282 | (40,404) |
Increase in other assets | (51,667) | (32,874) |
Decrease in income taxes payable, net | (270) | (710) |
(Decrease) increase in accrued interest payable | (9,081) | 18,610 |
Increase in other liabilities | 8,759 | 134,661 |
Total adjustments | (595,455) | (217,759) |
Total net provided by operating activities | 45,752 | 144,414 |
Investing activities | ||
Loans acquired and originated | (2,076,635) | (2,310,173) |
Net proceeds from sales of loans held for investment | 3,436,391 | 3,283,408 |
Proceeds from claim payments | 4,602 | 11,314 |
Net decrease in loans held for investment | 1,021,353 | 1,177,589 |
Purchases of available-for-sale securities | (200,716) | (62,752) |
Proceeds from sales and maturities of available-for-sale securities | 205,367 | 18,836 |
Total net cash provided by investing activities | 2,390,362 | 2,118,222 |
Financing activities | ||
Brokered deposit placement fee | 0 | (1,762) |
Net (decrease) increase in certificates of deposit | (686,344) | 69,971 |
Net increase (decrease) in other deposits | 850,408 | (55,044) |
Borrowings collateralized by loans in securitization trusts - issued | 0 | 633,532 |
Borrowings collateralized by loans in securitization trusts - repaid | (272,123) | (281,086) |
Issuance costs for unsecured debt offering | (325) | 0 |
Repayment of borrowings under Secured Borrowing Facility | 0 | (289,230) |
Fees paid on Secured Borrowing Facility | (2,833) | (3,183) |
Common stock dividends paid | (10,906) | (12,595) |
Preferred stock dividends paid | (1,201) | (3,464) |
Common stock repurchased | (550,790) | (558,167) |
Net cash used in financing activities | (674,114) | (501,028) |
Net increase in cash, cash equivalents and restricted cash | 1,762,000 | 1,761,608 |
Cash, cash equivalents and restricted cash at beginning of period | 4,609,709 | 5,720,760 |
Cash, cash equivalents and restricted cash at end of period | 6,371,709 | 7,482,368 |
Cash disbursements made for: | ||
Interest | 76,491 | 151,017 |
Income taxes paid | 887 | 3,630 |
Income taxes refunded | (1,049) | (2,890) |
Reconciliation of the Consolidated Statements of Cash Flows to the Consolidated Balance Sheets: | ||
Total cash, cash equivalents and restricted cash | $ 6,371,709 | $ 7,482,368 |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation The accompanying unaudited, consolidated financial statements of SLM Corporation (“Sallie Mae,” “SLM,” the “Company,” “we,” or “us”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all the information and footnotes required by GAAP for complete consolidated financial statements. The consolidated financial statements include the accounts of SLM Corporation and its majority-owned and controlled subsidiaries after eliminating the effects of intercompany accounts and transactions. In the opinion of management, all adjustments considered necessary for a fair statement of the results for the interim periods have been included. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Operating results for the three months ended March 31, 2021 are not necessarily indicative of the results for the year ending December 31, 2021 or for any other period. These unaudited financial statements should be read in conjunction with the audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”). Consolidation The consolidated financial statements include the accounts of the Company and its majority-owned and controlled subsidiaries after eliminating the effects of intercompany accounts and transactions. We consolidate any variable interest entity (“VIE”) where we have determined we are the primary beneficiary. The primary beneficiary is the entity which has both: (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses or receive benefits of the entity that could potentially be significant to the VIE. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Trading Investments From time to time we sell Private Education Loans through securitization transactions where we are required to retain a 5 percent vertical risk retention interest (i.e., 5 percent of each class issued in the securitizations). We classify those vertical risk retention interests related to the transactions as available-for-sale investments, except for the interest in the residual classes, which we classify as trading investments recorded at fair value with changes recorded through earnings. At March 31, 2021 and December 31, 2020, we had $31 million and $17 million, respectively, classified as trading investments. Available-for-Sale Investments The amortized cost and fair value of securities available for sale are as follows: March 31, 2021 Amortized Cost Allowance for credit losses (1) Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale: Mortgage-backed securities $ 348,080 $ — $ 3,492 $ (6,545) $ 345,027 Utah Housing Corporation bonds 8,375 — 80 (15) 8,440 U.S. government-sponsored enterprises and Treasuries 1,560,848 — 2,581 (146) 1,563,283 Other securities 198,976 — 769 (610) 199,135 Total $ 2,116,279 $ — $ 6,922 $ (7,316) $ 2,115,885 December 31, 2020 Amortized Cost Allowance for credit losses (1) Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale: Mortgage-backed securities $ 308,913 $ — $ 6,095 $ (134) $ 314,874 Utah Housing Corporation bonds 12,357 — 210 — 12,567 U.S. government-sponsored enterprises 1,596,890 — 3,395 — 1,600,285 Other securities 68,797 — 462 (351) 68,908 Total $ 1,986,957 $ — $ 10,162 $ (485) $ 1,996,634 ___________ (1) Represents the amount of impairment that has resulted from credit-related factors, and that was recognized in the consolidated balance sheets (as a credit loss expense on available-for-sale securities). The amount excludes unrealized losses related to non-credit factors. The following table summarizes the amount of gross unrealized losses for our available-for-sale securities and the estimated fair value for securities having gross unrealized loss positions, categorized by length of time the securities have been in an unrealized loss position: Less than 12 months 12 months or more Total Gross Estimated Gross Estimated Gross Estimated As of March 31, 2021: Mortgage-backed securities $ (6,545) $ 242,386 $ — $ — $ (6,545) $ 242,386 Utah Housing Corporation bonds (15) 4,357 — — (15) 4,357 U.S. government-sponsored enterprises and Treasuries (146) 114,870 — — (146) 114,870 Other securities (339) 89,603 (271) 12,776 (610) 102,379 Total $ (7,045) $ 451,216 $ (271) $ 12,776 $ (7,316) $ 463,992 As of December 31, 2020: Mortgage-backed securities $ (134) $ 46,011 $ — $ — $ (134) $ 46,011 Utah Housing Corporation bonds — — — — — — U.S. government-sponsored enterprises — — — — — — Other securities (351) 30,441 — — (351) 30,441 Total $ (485) $ 76,452 $ — $ — $ (485) $ 76,452 At March 31, 2021 and December 31, 2020, 40 of 175 and 14 of 163, respectively, of our available-for-sale debt securities were in an unrealized loss position. Impairment For available-for-sale debt securities in an unrealized loss position, we first assess whether we intend to sell, or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either of these criteria is met, the security’s amortized cost basis is written down to fair value through income. For securities in an unrealized loss position that do not meet these criteria, we evaluate whether the decline in fair value has resulted from credit loss or other factors. In making this assessment, we consider the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, adverse conditions specifically related to the security, as well as any guarantees (e.g., guarantees by the U.S. Government) that may be applicable to the security. If this assessment indicates a credit loss exists, the credit-related portion of the loss is recorded as an allowance for losses on the security. Our investment portfolio contains mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac, as well as Utah Housing Corporation bonds. We own these securities to meet our requirements under the Community Reinvestment Act (“CRA”). We also invest in other U.S. government-sponsored enterprise securities issued by the Federal Home Loan Bank, Freddie Mac, and the Federal Farm Credit Bank. Our mortgage-backed securities that were issued under Ginnie Mae programs carry a full faith and credit guarantee from the U.S. Government. The remaining mortgage-backed securities in a net loss position carry a principal and interest guarantee by Fannie Mae or Freddie Mac, respectively. Our Treasury and other U.S. government-sponsored enterprise bonds are rated Aaa by Standard and Poor’s or AA+ by Moody’s Investors Service. The decline in value from December 31, 2020 to March 31, 2021 was driven by the current interest rate environment and is not credit related. We have the intent and ability to hold these bonds for a period of time sufficient for the market price to recover to at least the adjusted amortized cost of the security. Based on this qualitative analysis, we have determined that no credit impairment exists. From time to time we sell Private Education Loans through securitization transactions where we are required to retain a 5 percent vertical risk retention interest. We classify the non-residual vertical retention interests as available-for-sale investments. We have the intent and ability to hold each of these bonds for a period of time sufficient for the market price to recover to at least the adjusted amortized cost of the security. We expect to receive all contractual cash flows related to these investments and do not consider a credit impairment to exist. As of March 31, 2021, the amortized cost and fair value of securities, by contractual maturities, are summarized below. Contractual maturities versus actual maturities may differ due to the effect of prepayments. Year of Maturity Amortized Cost Estimated Fair Value 2021 $ 293,759 $ 294,232 2022 1,018,268 1,019,960 2023 148,822 149,166 2024 100,000 99,925 2038 76 88 2039 1,601 1,773 2042 4,201 4,206 2043 7,415 7,711 2044 10,133 10,610 2045 8,870 9,179 2046 14,414 14,797 2047 18,646 18,992 2048 4,362 4,545 2049 36,368 37,683 2050 174,919 170,740 2051 75,449 73,143 2053 134,414 134,289 2054 64,562 64,846 Total $ 2,116,279 $ 2,115,885 Some of our securities have been pledged to the Federal Reserve Bank (the “FRB”) as collateral against any advances and accrued interest under the Primary Credit lending program sponsored by the FRB. We had $786 million and $815 million par value of securities pledged to this borrowing facility at March 31, 2021 and December 31, 2020, respectively, as discussed further in Notes to Consolidated Financial Statements, Note 8, “Borrowings.” Other Investments Investments in Non-Marketable Securities We hold investments in non-marketable securities and account for these investments at cost, less impairment, plus or minus observable price changes of identical or similar securities of the same issuer. As of March 31, 2021 and December 31, 2020, our total investment in these securities was $26 million and $26 million, respectively. Low Income Housing Tax Credit Investments We invest in affordable housing projects that qualify for the low income housing tax credit (“LIHTC”), which is designed to promote private development of low income housing. These investments generate a return mostly through realization of federal tax credits. Total carrying value of the LIHTC investments was $52 million at March 31, 2021 and $54 million at December 31, 2020. We are periodically required to provide additional financial support during the investment period. Our liability for these unfunded commitments was $15 million at March 31, 2021 and $19 million at December 31, 2020. Related to these investments, we recognized tax credits and other tax benefits through tax expense of $1 million at March 31, 2021 and $6 million at December 31, 2020. Tax credits and other tax benefits are recognized as part of our annual effective tax rate used to determine tax expense in a given quarter. Accordingly, the portion of a year’s expected tax benefits recognized in any given quarter may differ from 25 percent. |
Loans Held for Investment
Loans Held for Investment | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Loans Held for Investment | Loans Held for Investment Loans held for investment consist of Private Education Loans, FFELP Loans, Personal Loans, and Credit Cards. We use “Private Education Loans” to mean education loans to students or their families that are not made, insured, or guaranteed by any state or federal government. Private Education Loans do not include loans insured or guaranteed under the previously existing Federal Family Education Loan Program (“FFELP”). We use “Credit Cards” to refer to our suite of Credit Cards with bonus rewards. We use “Personal Loans” to mean those unsecured loans to individuals that may be used for non-educational purposes. In the third quarter of 2020, we sold our entire Personal Loan portfolio. Our Private Education Loans are made largely to bridge the gap between the cost of higher education and the amount funded through financial aid, government loans, and customers’ resources. Private Education Loans bear the full credit risk of the customer. We manage this risk through risk-performance underwriting strategies and qualified cosigners. Private Education Loans may be fixed-rate or may carry a variable interest rate indexed to LIBOR, the London interbank offered rate, or another index in the future. As of March 31, 2021 and December 31, 2020, 54 percent and 55 percent, respectively, of all of our Private Education Loans were indexed to LIBOR. We provide incentives for customers to include a cosigner on the loan, and the vast majority of Private Education Loans in our portfolio are cosigned. We also encourage customers to make payments while in school. FFELP Loans are insured as to their principal and accrued interest in the event of default, subject to a risk-sharing level based on the date of loan disbursement. These insurance obligations are supported by contractual rights against the United States. For loans disbursed on or after July 1, 2006, we receive 97 percent reimbursement on all qualifying claims. For loans disbursed after October 1, 1993, and before July 1, 2006, we receive 98 percent reimbursement on all qualifying claims. For loans disbursed prior to October 1, 1993, we receive 100 percent reimbursement on all qualifying claims. In the first quarter of 2021, we recognized a $399 million gain from the sale of approximately $3.16 billion of our Private Education Loans, including $2.97 billion of principal and $193 million in capitalized interest, to an unaffiliated third party. There were VIEs created in the execution of certain of these loan sales; however, based on our consolidation analysis, we are not the primary beneficiary of these VIEs. These transactions qualified for sale treatment and removed the balance of the loans from our balance sheet on the respective settlement dates. We remained the servicer of these loans pursuant to applicable servicing agreements executed in connection with the sales. For additional information see Notes to Consolidated Financial Statements, Note 8, “Borrowings.” Loans held for investment are summarized as follows: March 31, December 31, 2021 2020 Private Education Loans: Fixed-rate $ 9,504,760 $ 8,950,216 Variable-rate 11,237,080 10,779,121 Total Private Education Loans, gross 20,741,840 19,729,337 Deferred origination costs and unamortized premium/(discount) 64,468 63,475 Allowance for credit losses (1,173,375) (1,355,844) Total Private Education Loans, net 19,632,933 18,436,968 FFELP Loans 727,664 737,593 Deferred origination costs and unamortized premium/(discount) 1,954 1,993 Allowance for credit losses (4,318) (4,378) Total FFELP Loans, net 725,300 735,208 Credit Cards (fixed-rate) 11,309 12,238 Deferred origination costs and unamortized premium/(discount) 73 230 Allowance for credit losses (1,328) (1,501) Total Credit Cards, net 10,054 10,967 Loans held for investment, net $ 20,368,287 $ 19,183,143 The estimated weighted average life of education loans in our portfolio was approximately 4.6 years and 5.4 years at March 31, 2021 and December 31, 2020, respectively. The average balance and the respective weighted average interest rates of loans in our portfolio are summarized as follows: Three Months Ended March 31, 2021 2020 Average Balance Weighted Average Interest Rate Average Balance Weighted Average Interest Rate Private Education Loans $ 20,984,491 8.22 % $ 23,502,844 8.86 % FFELP Loans 734,289 3.41 776,326 4.29 Personal Loans — — 973,671 12.11 Credit Cards 11,841 0.78 5,286 (4.72) Total portfolio $ 21,730,621 $ 25,258,127 Certain Collection Tools - Private Education Loans We adjust the terms of loans for certain borrowers when we believe such changes will help our customers manage their student loan obligations, achieve better student outcomes, and increase the collectability of the loan. These changes generally take the form of a temporary forbearance of payments, a temporary interest rate reduction, a temporary interest rate reduction with a permanent extension of the loan term, and/or a short-term extended repayment alternative. Forbearance is granted prospectively for borrowers who are current in their payments and may be granted retroactively for certain delinquent borrowers. Forbearance allows a borrower to temporarily not make scheduled payments or to make smaller than scheduled payments, in each case for a specified period of time. Using forbearance extends the original term of the loan by the term of forbearance taken. Forbearance does not grant any reduction in the total principal or interest repayment obligation. While a loan is in forbearance status, interest continues to accrue and is capitalized to principal when the loan re-enters repayment status (except as described below in the case of disaster forbearance). We grant forbearance through our servicing centers to borrowers who are current in their payments and through our collections centers to certain borrowers who are delinquent. Our forbearance policies and practices vary depending upon whether a borrower is current or delinquent at the time forbearance is requested, generally with stricter payment requirements for delinquent borrowers. We view the population of borrowers that use forbearance positively because the borrowers are either proactively reaching out to us to obtain assistance in managing their obligations or are working with our collections center to bring their loans current. Forbearance may be granted through our servicing centers to customers who are exiting their grace period, and to other customers who are current in their payments, to provide temporary payment relief. In these circumstances, a customer’s loan is placed into a forbearance status in limited monthly increments and is reflected in the forbearance status at month-end during this time. At the end of the forbearance period, the customer will enter repayment status as current and is expected to begin making scheduled monthly payments. Currently, we generally grant forbearance in our servicing centers if a borrower who is current requests it for increments of up to three months at a time, for up to 12 months. Forbearance may also be granted through our collections centers to customers who are delinquent in their payments. If specific payment requirements are met, the forbearance can cure the delinquency and the customer is returned to a current repayment status. Forbearance as a collection tool is used most effectively when applying historical experience and our judgment to a customer’s unique situation. We leverage updated customer information and other decision support tools to best determine who will be granted forbearance based on our expectations as to a customer’s ability and willingness to repay their obligation. This strategy is aimed at assisting customers while mitigating the risks of delinquency and default as well as encouraging resolution of delinquent loans. In all instances, we require one or more payments before granting forbearance to delinquent borrowers. The COVID-19 pandemic is having far reaching, negative impacts on individuals, businesses, and, consequently, the overall economy. Specifically, COVID-19 has materially disrupted business operations throughout the country, resulting in significantly higher levels of unemployment or underemployment. As a result, we expect many of our individual customers will experience financial hardship, making it difficult, if not impossible, to meet their payment obligations to us without temporary assistance. We are monitoring key metrics as early warning indicators of financial hardship, including changes in weekly unemployment claims, enrollment in auto-debit payments, requests for new forbearances, enrollment in hardship payment plans, and early delinquency metrics. As a result of the negative impact on employment from COVID-19, our customers are experiencing higher levels of financial hardship, which led initially to higher levels of forbearance. We expect such higher levels of financial hardship to lead to higher levels of delinquencies and defaults in the future, as borrowers who had received disaster forbearance from us re-enter repayment status. We expect that, left unabated, this deterioration in forbearance, delinquency, and default rates will persist until such time as the economy and employment return to relatively normal levels. For some students, going back to school in the fall was not an option because of the pandemic, or for other reasons. Therefore, some students are taking a “gap year” before returning to school. In 2020, for those students that had unexpectedly separated from school, we provided an extension of time through fall 2021 to re-enroll, before beginning their grace period that occurs prior to entering full principal and interest repayment status. At March 31, 2021, $784 million of Private Education Loans were granted this extended period of time. See Note 5, “Allowance for Credit Losses — Delinquencies — Private Education Loans Held for Investment” for an additional breakout of these loans. We assist customers with an array of payment programs during periods of financial hardship as standard operating convention, including: forbearance, which defers payments during a short-term hardship; our Graduated Repayment Plan (“GRP”), which is an interest-only payment for 12 months; or a loan modification that, in the event of long-term hardship, reduces the interest rate on a loan to 4 percent for 24 months and/or permanently extends the maturity date of the loan. Historically, we have utilized disaster forbearance for material events, including hurricanes, wildfires, and floods. Disaster forbearance defers payments for as much as 90 days upon enrollment. We have invoked this same disaster forbearance program to assist our customers through COVID-19 and offer this program across our operations, including through mobile app and self-service channels such as chat and interactive voice response. Customers who receive a disaster forbearance will not progress in delinquency and will not be assessed late fees or other fees. During a disaster forbearance, a customer’s credit file will continue to reflect the status of the loan as it was immediately prior to granting the disaster forbearance. During the period of the disaster forbearance, interest will continue to accrue, but is not capitalized to the loan balance after the loan returns to repayment status. The first wave of disaster forbearance was granted primarily in 90-day increments. As these forbearances ended, we reduced the disaster forbearance to one-month increments and implemented additional discussions between our servicing agents and borrowers to encourage borrowers/cosigners to enter repayment. If the financial hardship extends beyond 90 days, additional assistance will be available for eligible customers. For example, for borrowers exiting disaster forbearance and not eligible for GRP, we may allow them to make interest only payments for 12 months before reverting to full principal and interest payments. Management continually monitors our credit administration practices and may periodically modify these practices based upon performance, industry conventions, and/or regulatory feedback. In light of these considerations, we previously announced that we plan to implement certain changes to our credit administration practices in the future. As discussed below, however, we postponed until the fourth quarter of 2020 the implementation of the announced credit administration practices changes due to the COVID-19 pandemic. Specifically, we previously announced that we plan to revise our credit administration practices limiting the number of forbearance months granted consecutively and the number of times certain extended or reduced repayment alternatives may be granted. For example, we currently grant forbearance to borrowers without requiring any period of prior principal and interest payments, meaning that, if a borrower satisfies all eligibility requirements, forbearance increments may be granted consecutively. We previously announced that, beginning in the second quarter of 2020, we would phase in a required six-month period between successive grants of forbearance and between forbearance grants and certain other repayment alternatives. We announced this required period will not apply, however, to forbearances granted during the first six months following a borrower’s grace period and will not be required for a borrower to receive a contractual interest rate reduction. In addition, we announced we would limit the participation of delinquent borrowers in certain short-term extended or interest-only repayment alternatives to once in 12 months and twice in five years. As previously announced, prior to full implementation of the credit administration practices changes described above, management will conduct a controlled testing program on randomly selected borrowers to measure the impact of the changes on our customers, our credit operations, and key credit metrics. The testing commenced in October 2019 for some of the planned changes on a very small percentage of our total portfolio and we originally expected to expand the number of borrowers in repayment who would be subject to the new credit administration practices. However, due to the COVID-19 pandemic, we postponed our efforts so that we can be more flexible in dealing with our customers’ financial hardship. In October 2020, we began to roll out in a methodical approach the implementation of the credit administration practices changes and related testing. Management now expects to have completed implementation of the planned credit administration practices changes in the third quarter of 2021. However, we may modify or delay the contemplated practice changes, the proposed timeline, or the method of implementation as we learn more about the impacts of the program on our customers. We also offer rate and term modifications to customers experiencing more severe hardship. Currently, we temporarily reduce the contractual interest rate on a loan to 4.0 percent for a two-year period and, in the vast majority of cases, permanently extend the final maturity date of the loan. As part of demonstrating the ability and willingness to pay, the customer must make three consecutive monthly payments at the reduced payment to qualify for the program. The combination of the rate reduction and maturity extension helps reduce the monthly payment due from the borrower and increases the likelihood the borrower will remain current during the interest rate modification period as well as when the loan returns to its original contractual interest rate. At March 31, 2021 and December 31, 2020, 8.1 percent and 7.8 percent, respectively, of our loans then currently in full principal and interest repayment status were subject to interest rate reductions made under our rate modification program. We currently have no plans to change the basic elements of the rate and term modifications we offer to our customers experiencing more severe hardship. While there are limitations to our estimate of the future impact of the credit administration practices changes described above, absent the effect of any mitigating measures, and based on an analysis of borrower behavior under our current credit administration practices, which may not be indicative of how borrowers will behave under revised credit administration practices, we expect that the credit administration practices changes described above will accelerate defaults and could increase life of loan defaults in our Private Education Loan held for investment portfolio by approximately 4 percent to 14 percent. Among the measures that we are planning to implement and expect may partly offset or moderate any acceleration of or increase in defaults will be greater focus on the risk assessment process to ensure borrowers are mapped to the appropriate program, better utilization of existing programs (e.g., GRP and rate modifications), and the introduction of a new program offering short-term payment reductions (permitting interest-only payments for up to six months) for certain early stage delinquencies. The full impact of these changes to our collections practices described above may only be realized over the longer term, however. In particular, when we calculate the allowance for credit losses under CECL, which became effective on January 1, 2020, our loan loss reserves increased materially because we expect the life of loan defaults on our overall Private Education Loan portfolio to increase, in part as a result of the planned changes to our credit administration practices. As we progress with the controlled testing program of the planned changes to our credit administration practices, we expect to learn more about how our borrowers are reacting to these changes and, as we analyze such reactions, we will continue to refine our estimates of the impact of those changes on our allowance for credit losses. We had no loans held for sale and $2.9 billion in loans held for sale at March 31, 2021 and December 31, 2020, respectively. At December 31, 2020, we reversed $206 million through the provisions for credit losses for the allowance related to those loans held for sale, when the loans were transferred from held for investment to held for sale. During the first quarter of 2021, we sold $3.16 billion of our Private Education Loans, including $2.97 billion of principal and $193 million in capitalized interest, to an unaffiliated third party. The transactions qualified for sale treatment and removed the balance of the loans from our balance sheet on the respective settlement dates. We remained the servicer of these loans pursuant to applicable servicing agreements executed in connection with the sales. These sales resulted in our recognizing a gain of $399 million in the first quarter of 2021. For additional information, see Notes to Consolidated Financial Statements, Note 3, “Loans Held for Investment,” and Note 8, “Borrowings.” |
Loans Held for Sale
Loans Held for Sale | 3 Months Ended |
Mar. 31, 2021 | |
Transfers and Servicing [Abstract] | |
Loans Held for Sale | Loans Held for Investment Loans held for investment consist of Private Education Loans, FFELP Loans, Personal Loans, and Credit Cards. We use “Private Education Loans” to mean education loans to students or their families that are not made, insured, or guaranteed by any state or federal government. Private Education Loans do not include loans insured or guaranteed under the previously existing Federal Family Education Loan Program (“FFELP”). We use “Credit Cards” to refer to our suite of Credit Cards with bonus rewards. We use “Personal Loans” to mean those unsecured loans to individuals that may be used for non-educational purposes. In the third quarter of 2020, we sold our entire Personal Loan portfolio. Our Private Education Loans are made largely to bridge the gap between the cost of higher education and the amount funded through financial aid, government loans, and customers’ resources. Private Education Loans bear the full credit risk of the customer. We manage this risk through risk-performance underwriting strategies and qualified cosigners. Private Education Loans may be fixed-rate or may carry a variable interest rate indexed to LIBOR, the London interbank offered rate, or another index in the future. As of March 31, 2021 and December 31, 2020, 54 percent and 55 percent, respectively, of all of our Private Education Loans were indexed to LIBOR. We provide incentives for customers to include a cosigner on the loan, and the vast majority of Private Education Loans in our portfolio are cosigned. We also encourage customers to make payments while in school. FFELP Loans are insured as to their principal and accrued interest in the event of default, subject to a risk-sharing level based on the date of loan disbursement. These insurance obligations are supported by contractual rights against the United States. For loans disbursed on or after July 1, 2006, we receive 97 percent reimbursement on all qualifying claims. For loans disbursed after October 1, 1993, and before July 1, 2006, we receive 98 percent reimbursement on all qualifying claims. For loans disbursed prior to October 1, 1993, we receive 100 percent reimbursement on all qualifying claims. In the first quarter of 2021, we recognized a $399 million gain from the sale of approximately $3.16 billion of our Private Education Loans, including $2.97 billion of principal and $193 million in capitalized interest, to an unaffiliated third party. There were VIEs created in the execution of certain of these loan sales; however, based on our consolidation analysis, we are not the primary beneficiary of these VIEs. These transactions qualified for sale treatment and removed the balance of the loans from our balance sheet on the respective settlement dates. We remained the servicer of these loans pursuant to applicable servicing agreements executed in connection with the sales. For additional information see Notes to Consolidated Financial Statements, Note 8, “Borrowings.” Loans held for investment are summarized as follows: March 31, December 31, 2021 2020 Private Education Loans: Fixed-rate $ 9,504,760 $ 8,950,216 Variable-rate 11,237,080 10,779,121 Total Private Education Loans, gross 20,741,840 19,729,337 Deferred origination costs and unamortized premium/(discount) 64,468 63,475 Allowance for credit losses (1,173,375) (1,355,844) Total Private Education Loans, net 19,632,933 18,436,968 FFELP Loans 727,664 737,593 Deferred origination costs and unamortized premium/(discount) 1,954 1,993 Allowance for credit losses (4,318) (4,378) Total FFELP Loans, net 725,300 735,208 Credit Cards (fixed-rate) 11,309 12,238 Deferred origination costs and unamortized premium/(discount) 73 230 Allowance for credit losses (1,328) (1,501) Total Credit Cards, net 10,054 10,967 Loans held for investment, net $ 20,368,287 $ 19,183,143 The estimated weighted average life of education loans in our portfolio was approximately 4.6 years and 5.4 years at March 31, 2021 and December 31, 2020, respectively. The average balance and the respective weighted average interest rates of loans in our portfolio are summarized as follows: Three Months Ended March 31, 2021 2020 Average Balance Weighted Average Interest Rate Average Balance Weighted Average Interest Rate Private Education Loans $ 20,984,491 8.22 % $ 23,502,844 8.86 % FFELP Loans 734,289 3.41 776,326 4.29 Personal Loans — — 973,671 12.11 Credit Cards 11,841 0.78 5,286 (4.72) Total portfolio $ 21,730,621 $ 25,258,127 Certain Collection Tools - Private Education Loans We adjust the terms of loans for certain borrowers when we believe such changes will help our customers manage their student loan obligations, achieve better student outcomes, and increase the collectability of the loan. These changes generally take the form of a temporary forbearance of payments, a temporary interest rate reduction, a temporary interest rate reduction with a permanent extension of the loan term, and/or a short-term extended repayment alternative. Forbearance is granted prospectively for borrowers who are current in their payments and may be granted retroactively for certain delinquent borrowers. Forbearance allows a borrower to temporarily not make scheduled payments or to make smaller than scheduled payments, in each case for a specified period of time. Using forbearance extends the original term of the loan by the term of forbearance taken. Forbearance does not grant any reduction in the total principal or interest repayment obligation. While a loan is in forbearance status, interest continues to accrue and is capitalized to principal when the loan re-enters repayment status (except as described below in the case of disaster forbearance). We grant forbearance through our servicing centers to borrowers who are current in their payments and through our collections centers to certain borrowers who are delinquent. Our forbearance policies and practices vary depending upon whether a borrower is current or delinquent at the time forbearance is requested, generally with stricter payment requirements for delinquent borrowers. We view the population of borrowers that use forbearance positively because the borrowers are either proactively reaching out to us to obtain assistance in managing their obligations or are working with our collections center to bring their loans current. Forbearance may be granted through our servicing centers to customers who are exiting their grace period, and to other customers who are current in their payments, to provide temporary payment relief. In these circumstances, a customer’s loan is placed into a forbearance status in limited monthly increments and is reflected in the forbearance status at month-end during this time. At the end of the forbearance period, the customer will enter repayment status as current and is expected to begin making scheduled monthly payments. Currently, we generally grant forbearance in our servicing centers if a borrower who is current requests it for increments of up to three months at a time, for up to 12 months. Forbearance may also be granted through our collections centers to customers who are delinquent in their payments. If specific payment requirements are met, the forbearance can cure the delinquency and the customer is returned to a current repayment status. Forbearance as a collection tool is used most effectively when applying historical experience and our judgment to a customer’s unique situation. We leverage updated customer information and other decision support tools to best determine who will be granted forbearance based on our expectations as to a customer’s ability and willingness to repay their obligation. This strategy is aimed at assisting customers while mitigating the risks of delinquency and default as well as encouraging resolution of delinquent loans. In all instances, we require one or more payments before granting forbearance to delinquent borrowers. The COVID-19 pandemic is having far reaching, negative impacts on individuals, businesses, and, consequently, the overall economy. Specifically, COVID-19 has materially disrupted business operations throughout the country, resulting in significantly higher levels of unemployment or underemployment. As a result, we expect many of our individual customers will experience financial hardship, making it difficult, if not impossible, to meet their payment obligations to us without temporary assistance. We are monitoring key metrics as early warning indicators of financial hardship, including changes in weekly unemployment claims, enrollment in auto-debit payments, requests for new forbearances, enrollment in hardship payment plans, and early delinquency metrics. As a result of the negative impact on employment from COVID-19, our customers are experiencing higher levels of financial hardship, which led initially to higher levels of forbearance. We expect such higher levels of financial hardship to lead to higher levels of delinquencies and defaults in the future, as borrowers who had received disaster forbearance from us re-enter repayment status. We expect that, left unabated, this deterioration in forbearance, delinquency, and default rates will persist until such time as the economy and employment return to relatively normal levels. For some students, going back to school in the fall was not an option because of the pandemic, or for other reasons. Therefore, some students are taking a “gap year” before returning to school. In 2020, for those students that had unexpectedly separated from school, we provided an extension of time through fall 2021 to re-enroll, before beginning their grace period that occurs prior to entering full principal and interest repayment status. At March 31, 2021, $784 million of Private Education Loans were granted this extended period of time. See Note 5, “Allowance for Credit Losses — Delinquencies — Private Education Loans Held for Investment” for an additional breakout of these loans. We assist customers with an array of payment programs during periods of financial hardship as standard operating convention, including: forbearance, which defers payments during a short-term hardship; our Graduated Repayment Plan (“GRP”), which is an interest-only payment for 12 months; or a loan modification that, in the event of long-term hardship, reduces the interest rate on a loan to 4 percent for 24 months and/or permanently extends the maturity date of the loan. Historically, we have utilized disaster forbearance for material events, including hurricanes, wildfires, and floods. Disaster forbearance defers payments for as much as 90 days upon enrollment. We have invoked this same disaster forbearance program to assist our customers through COVID-19 and offer this program across our operations, including through mobile app and self-service channels such as chat and interactive voice response. Customers who receive a disaster forbearance will not progress in delinquency and will not be assessed late fees or other fees. During a disaster forbearance, a customer’s credit file will continue to reflect the status of the loan as it was immediately prior to granting the disaster forbearance. During the period of the disaster forbearance, interest will continue to accrue, but is not capitalized to the loan balance after the loan returns to repayment status. The first wave of disaster forbearance was granted primarily in 90-day increments. As these forbearances ended, we reduced the disaster forbearance to one-month increments and implemented additional discussions between our servicing agents and borrowers to encourage borrowers/cosigners to enter repayment. If the financial hardship extends beyond 90 days, additional assistance will be available for eligible customers. For example, for borrowers exiting disaster forbearance and not eligible for GRP, we may allow them to make interest only payments for 12 months before reverting to full principal and interest payments. Management continually monitors our credit administration practices and may periodically modify these practices based upon performance, industry conventions, and/or regulatory feedback. In light of these considerations, we previously announced that we plan to implement certain changes to our credit administration practices in the future. As discussed below, however, we postponed until the fourth quarter of 2020 the implementation of the announced credit administration practices changes due to the COVID-19 pandemic. Specifically, we previously announced that we plan to revise our credit administration practices limiting the number of forbearance months granted consecutively and the number of times certain extended or reduced repayment alternatives may be granted. For example, we currently grant forbearance to borrowers without requiring any period of prior principal and interest payments, meaning that, if a borrower satisfies all eligibility requirements, forbearance increments may be granted consecutively. We previously announced that, beginning in the second quarter of 2020, we would phase in a required six-month period between successive grants of forbearance and between forbearance grants and certain other repayment alternatives. We announced this required period will not apply, however, to forbearances granted during the first six months following a borrower’s grace period and will not be required for a borrower to receive a contractual interest rate reduction. In addition, we announced we would limit the participation of delinquent borrowers in certain short-term extended or interest-only repayment alternatives to once in 12 months and twice in five years. As previously announced, prior to full implementation of the credit administration practices changes described above, management will conduct a controlled testing program on randomly selected borrowers to measure the impact of the changes on our customers, our credit operations, and key credit metrics. The testing commenced in October 2019 for some of the planned changes on a very small percentage of our total portfolio and we originally expected to expand the number of borrowers in repayment who would be subject to the new credit administration practices. However, due to the COVID-19 pandemic, we postponed our efforts so that we can be more flexible in dealing with our customers’ financial hardship. In October 2020, we began to roll out in a methodical approach the implementation of the credit administration practices changes and related testing. Management now expects to have completed implementation of the planned credit administration practices changes in the third quarter of 2021. However, we may modify or delay the contemplated practice changes, the proposed timeline, or the method of implementation as we learn more about the impacts of the program on our customers. We also offer rate and term modifications to customers experiencing more severe hardship. Currently, we temporarily reduce the contractual interest rate on a loan to 4.0 percent for a two-year period and, in the vast majority of cases, permanently extend the final maturity date of the loan. As part of demonstrating the ability and willingness to pay, the customer must make three consecutive monthly payments at the reduced payment to qualify for the program. The combination of the rate reduction and maturity extension helps reduce the monthly payment due from the borrower and increases the likelihood the borrower will remain current during the interest rate modification period as well as when the loan returns to its original contractual interest rate. At March 31, 2021 and December 31, 2020, 8.1 percent and 7.8 percent, respectively, of our loans then currently in full principal and interest repayment status were subject to interest rate reductions made under our rate modification program. We currently have no plans to change the basic elements of the rate and term modifications we offer to our customers experiencing more severe hardship. While there are limitations to our estimate of the future impact of the credit administration practices changes described above, absent the effect of any mitigating measures, and based on an analysis of borrower behavior under our current credit administration practices, which may not be indicative of how borrowers will behave under revised credit administration practices, we expect that the credit administration practices changes described above will accelerate defaults and could increase life of loan defaults in our Private Education Loan held for investment portfolio by approximately 4 percent to 14 percent. Among the measures that we are planning to implement and expect may partly offset or moderate any acceleration of or increase in defaults will be greater focus on the risk assessment process to ensure borrowers are mapped to the appropriate program, better utilization of existing programs (e.g., GRP and rate modifications), and the introduction of a new program offering short-term payment reductions (permitting interest-only payments for up to six months) for certain early stage delinquencies. The full impact of these changes to our collections practices described above may only be realized over the longer term, however. In particular, when we calculate the allowance for credit losses under CECL, which became effective on January 1, 2020, our loan loss reserves increased materially because we expect the life of loan defaults on our overall Private Education Loan portfolio to increase, in part as a result of the planned changes to our credit administration practices. As we progress with the controlled testing program of the planned changes to our credit administration practices, we expect to learn more about how our borrowers are reacting to these changes and, as we analyze such reactions, we will continue to refine our estimates of the impact of those changes on our allowance for credit losses. We had no loans held for sale and $2.9 billion in loans held for sale at March 31, 2021 and December 31, 2020, respectively. At December 31, 2020, we reversed $206 million through the provisions for credit losses for the allowance related to those loans held for sale, when the loans were transferred from held for investment to held for sale. During the first quarter of 2021, we sold $3.16 billion of our Private Education Loans, including $2.97 billion of principal and $193 million in capitalized interest, to an unaffiliated third party. The transactions qualified for sale treatment and removed the balance of the loans from our balance sheet on the respective settlement dates. We remained the servicer of these loans pursuant to applicable servicing agreements executed in connection with the sales. These sales resulted in our recognizing a gain of $399 million in the first quarter of 2021. For additional information, see Notes to Consolidated Financial Statements, Note 3, “Loans Held for Investment,” and Note 8, “Borrowings.” |
Allowance for Credit Losses
Allowance for Credit Losses | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Allowance for Credit Losses | Allowance for Credit Losses Our provision for credit losses represents the periodic expense of maintaining an allowance sufficient to absorb lifetime expected credit losses in the held for investment loan portfolios. The evaluation of the allowance for credit losses is inherently subjective, as it requires material estimates that may be susceptible to significant changes. We believe the allowance for credit losses is appropriate to cover lifetime losses expected to be incurred in the loan portfolios. See Notes to Consolidated Financial Statements, Note 2, “Significant Accounting Policies — Allowance for Credit Losses 2020 — Allowance for Private Education Loan Losses, — Allowance for FFELP Loan Losses, and — Allowance for Credit Card Loans” in our 2020 Form 10-K for a more detailed discussion. Allowance for Credit Losses Metrics Allowance for Credit Losses Three Months Ended March 31, 2021 FFELP Private Education Credit Cards Total Allowance for Credit Losses Beginning balance $ 4,378 $ 1,355,844 $ 1,501 $ 1,361,723 Transfer from unfunded commitment liability (1) — 126,880 — 126,880 Provisions: Provision for current period 29 (254,942) (86) (254,999) Loan sale reduction to provision — (8,858) — (8,858) Loan transfer from held-for-sale — 1,887 — 1,887 Total provisions (2) 29 (261,913) (86) (261,970) Net charge-offs: Charge-offs (89) (55,139) (88) (55,316) Recoveries — 7,703 1 7,704 Net charge-offs (89) (47,436) (87) (47,612) Loan sales — — — — Ending Balance $ 4,318 $ 1,173,375 $ 1,328 $ 1,179,021 Allowance: Ending balance: individually evaluated for impairment $ — $ 95,536 $ — $ 95,536 Ending balance: collectively evaluated for impairment $ 4,318 $ 1,077,839 $ 1,328 $ 1,083,485 Loans: Ending balance: individually evaluated for impairment $ — $ 1,225,604 $ — $ 1,225,604 Ending balance: collectively evaluated for impairment $ 727,664 $ 19,516,236 $ 11,309 $ 20,255,209 Net charge-offs as a percentage of average loans in repayment (annualized) (3) 0.06 % 1.29 % 2.92 % Allowance as a percentage of the ending total loan balance 0.59 % 5.66 % 11.74 % Allowance as a percentage of the ending loans in repayment (3) 0.80 % 7.94 % 11.74 % Allowance coverage of net charge-offs (annualized) 12.13 6.18 3.82 Ending total loans, gross $ 727,664 $ 20,741,840 $ 11,309 Average loans in repayment (3) $ 554,510 $ 14,743,508 $ 11,909 Ending loans in repayment (3) $ 540,903 $ 14,777,939 $ 11,309 ____________ (1) See Note 6, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively. (2) Below is a reconciliation of the provision for credit losses reported in the consolidated statements of income. When a new loan commitment is made, we record the CECL allowance as a liability for unfunded commitments by recording a provision for credit losses. When the loan is funded, we transfer that liability to the allowance for credit losses. Consolidated Statements of Income Three Months Ended Private Education Loan provisions for credit losses: Provisions for loan losses $ (261,913) Provisions for unfunded loan commitments 36,203 Total Private Education Loan provisions for credit losses (225,710) Other impacts to the provisions for credit losses: FFELP Loans 29 Credit Cards (86) Total (57) Provisions for credit losses reported in consolidated statements of income $ (225,767) (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period. Allowance for Credit Losses Three Months Ended March 31, 2020 FFELP Private Education Personal Credit Cards Total Allowance for Credit Losses Beginning balance $ 1,633 $ 374,300 $ 65,877 $ 102 $ 441,912 Day 1 adjustment for the adoption of CECL 2,852 1,060,830 79,183 188 1,143,053 Balance at January 1, 2020 4,485 1,435,130 145,060 290 1,584,965 Transfer from unfunded commitment liability (1) — 142,075 — — 142,075 Provisions: Provision for current period 37 143,862 25,318 291 169,508 Loan sale reduction to provision — (161,793) — — (161,793) Total provisions (2) 37 (17,931) 25,318 291 7,715 Net charge-offs: Charge-offs (226) (51,469) (19,247) (7) (70,949) Recoveries — 7,976 1,542 — 9,518 Net charge-offs (226) (43,493) (17,705) (7) (61,431) Ending Balance $ 4,296 $ 1,515,781 $ 152,673 $ 574 $ 1,673,324 Allowance: Ending balance: individually evaluated for impairment $ — $ 150,822 $ — $ — $ 150,822 Ending balance: collectively evaluated for impairment $ 4,296 $ 1,364,959 $ 152,673 $ 574 $ 1,522,502 Loans: Ending balance: individually evaluated for impairment $ — $ 1,518,763 $ — $ — $ 1,518,763 Ending balance: collectively evaluated for impairment $ 766,954 $ 20,107,984 $ 899,704 $ 7,234 $ 21,781,876 Net charge-offs as a percentage of average loans in repayment (annualized) (3) 0.15 % 1.05 % 7.27 % 0.52 % Allowance as a percentage of the ending total loan balance 0.56 % 7.01 % 16.97 % 7.93 % Allowance as a percentage of the ending loans in repayment (3) 0.74 % 10.11 % 16.97 % 7.93 % Allowance coverage of net charge-offs (annualized) 4.75 8.71 2.16 20.50 Ending total loans, gross $ 766,954 $ 21,626,747 $ 899,704 $ 7,234 Average loans in repayment (3) $ 600,534 $ 16,521,356 $ 973,772 $ 5,364 Ending loans in repayment (3) $ 581,997 $ 14,988,345 $ 899,704 $ 7,234 ____________ (1) See Note 6, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively. (2) Below is a reconciliation of the provisions for credit losses reported in the consolidated statements of income. When a new loan commitment is made, we record the CECL allowance as a liability for unfunded loan commitments by recording a provision for credit losses. When the loan is funded, we transfer that liability to the allowance for credit losses. Consolidated Statements of Income Three Months Ended Private Education Loan provisions for credit losses: Provisions for loan losses $ (17,931) Provisions for unfunded loan commitments 53,543 Total Private Education Loan provisions for credit losses 35,612 Other impacts to the provisions for credit losses: Personal Loans 25,318 FFELP Loans 37 Credit Cards 291 Total 25,646 Provisions for credit losses reported in consolidated statements of income $ 61,258 (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period. Allowance for Credit Losses - Forecast Assumptions In determining the adequacy of the allowance for credit losses, we include forecasts of college graduate unemployment and the Consumer Price Index in our loss forecasting models. We obtain forecasts for these two inputs from Moody’s Analytics. Moody’s Analytics provides a range of forecasts for each of these inputs with various likelihoods of occurring. We determine which forecasts we will include in our estimation of allowance for credit losses and the associated weightings for each of these inputs. At both January 1, 2020 (the initial adoption date of the Financial Accounting Standards Board’s Accounting Standards Update No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” or “CECL”), and March 31, 2021, we used the Base (50th percentile likelihood of occurring)/S1 (stronger near-term growth scenario with 10 percent likelihood of occurring)/S3 (downside scenario with 10 percent likelihood of occurring) scenarios and weighted them 40 percent, 30 percent and 30 percent, respectively. Management reviews both the scenarios and their respective weightings each quarter in determining the allowance for credit losses. Provisions for credit losses in the current quarter decreased by $287 million compared with the year-ago quarter. During the first quarter of 2021, the provisions for credit losses line item was primarily affected by improvements in the economic forecasts coupled with a benefit from faster forecasted prepayment speeds. These benefits were offset by additional provision from the new loan commitments made during the first quarter of 2021. During the first quarter of 2021, we increased our estimates of future prepayment speeds during both the two-year reasonable and supportable period as well as the remaining term of the underlying loans. These faster estimated prepayment speeds during the two-year reasonable and supportable period reflect the significant improvement in economic forecasts, as well as the implementation of an updated prepayment speed model. We experienced higher prepayments during the COVID-19 pandemic, when unemployment rates were elevated, than we would have expected based upon our experience during past financial crises. To address this fundamental change, we increased our long-term expectations of prepayment speeds. Troubled Debt Restructurings (“TDRs”) All of our loans are collectively assessed for impairment, except for loans classified as TDRs (where we conduct individual assessments of impairment). We adjust the terms of loans for certain borrowers when we believe such changes will help our customers manage their student loan obligations, achieve better student outcomes, and increase the collectability of the loan. These changes generally take the form of a temporary forbearance of payments, a temporary interest rate reduction, a temporary interest rate reduction with a permanent extension of the loan term, and/or a short-term extended repayment alternative. When we give a borrower facing financial difficulty an interest rate reduction, we temporarily reduce the contractual interest rate on a loan to 4.0 percent for a two-year period and, in the vast majority of cases, permanently extend the final maturity date of the loan. The combination of these two loan term changes helps reduce the monthly payment due from the borrower and increases the likelihood the borrower will remain current during the interest rate modification period as well as when the loan returns to its original contractual interest rate. At March 31, 2021 and March 31, 2020, 8.1 percent and 8.5 percent, respectively, of our loans then currently in full principal and interest repayment status were subject to interest rate reductions made under our rate modification program. Once a loan qualifies for TDR status, it remains a TDR for allowance purposes for the remainder of its life. As of both March 31, 2021 and December 31, 2020, approximately 47 percent of TDRs were classified as such due to their forbearance status. For additional information, see Notes to Consolidated Financial Statements, Note 2, “Significant Accounting Policies —Allowance for Loan Losses 2020,” and Note 7, “Allowance for Credit Losses” in our 2020 Form 10-K. Within the Private Education Loan portfolio, loans greater than 90 days past due are nonperforming. FFELP Loans are at least 97 percent guaranteed as to their principal and accrued interest by the federal government in the event of default and, therefore, we do not deem FFELP Loans as nonperforming from a credit risk perspective at any point in their life cycle prior to claim payment and continue to accrue interest on those loans through the date of claim. At March 31, 2021 and December 31, 2020, all of our TDR loans had a related allowance recorded. The following table provides the recorded investment, unpaid principal balance and related allowance for our TDR loans. Recorded Investment Unpaid Principal Balance Allowance March 31, 2021 TDR Loans $ 1,263,651 $ 1,225,604 $ 95,536 December 31, 2020 TDR Loans $ 1,312,805 $ 1,274,590 $ 104,265 The following table provides the average recorded investment and interest income recognized for our TDR loans. Three Months Ended 2021 2020 Average Interest Average Interest TDR Loans $ 1,288,333 $ 21,489 $ 1,615,764 $ 26,488 The following table provides information regarding the loan status and aging of TDR loans. For the periods presented below, we updated our delinquency bucket periods to conform with the delinquency bucket periods defined by the Federal Financial Institutions Examination Council (“FFIEC”). March 31, December 31, 2021 2020 Balance % Balance % TDR loans in in-school/grace/deferment (1) $ 93,850 $ 88,750 TDR loans in forbearance (2) 68,609 76,704 TDR loans in repayment (3) and percentage of each status: Loans current 966,201 90.9 % 971,880 87.7 % Loans delinquent 30-59 days (4) 39,541 3.7 59,249 5.3 Loans delinquent 60-89 days (4) 29,892 2.8 43,576 3.9 Loans 90 days or greater past due (4) 27,511 2.6 34,431 3.1 Total TDR loans in repayment (3) 1,063,145 100.0 % 1,109,136 100.0 % Total TDR loans, gross $ 1,225,604 $ 1,274,590 _____ (1) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation). (2) Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period (but, for purposes of the table, do not include those loans while they are in forbearance). (4) The period of delinquency is based on the number of days scheduled payments are contractually past due. The following table provides the amount of modified loans (which include forbearance and reductions in interest rates) that became TDRs in the periods presented. Additionally, for the periods presented, the table summarizes charge-offs occurring in the TDR portfolio, as well as TDRs for which a payment default occurred in the relevant period presented and within 12 months of the loan first being designated as a TDR. We define payment default as 60 days past due for this disclosure. Three Months Ended Three Months Ended Modified Loans (1) Charge-offs Payment- Modified Loans (1) Charge-offs Payment- TDR Loans $ 3,717 $ 17,948 $ 4,869 $ 132,815 $ 19,375 $ 30,725 _____ (1) Represents the principal balance of loans that have been modified during the period and resulted in a TDR. Private Education Loans Held for Investment - Key Credit Quality Indicators FFELP Loans are at least 97 percent guaranteed as to their principal and accrued interest in the event of default; therefore, there are no key credit quality indicators associated with FFELP Loans. For Private Education Loans, the key credit quality indicators are FICO scores, the existence of a cosigner, the loan status, and loan seasoning. The FICO scores are assessed at original approval and periodically refreshed/updated through the loan’s term. The following tables highlight the gross principal balance of our Private Education Loan portfolio, by year of origination, stratified by key credit quality indicators. Private Education Loans Held for Investment - Credit Quality Indicators March 31, 2021 Year of Origination 2021 (1) 2020 (1) 2019 (1) 2018 (1) 2017 (1) 2016 and Prior (1) Total (1) % of Balance Cosigners: With cosigner $ 640,909 $ 3,954,261 $ 3,331,066 $ 2,431,585 $ 2,137,418 $ 5,799,561 $ 18,294,800 88 % Without cosigner 109,163 623,156 531,211 359,769 259,981 563,760 2,447,040 12 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % FICO at Origination (2) : Less than 670 $ 46,437 $ 253,657 $ 283,992 $ 217,921 $ 189,704 $ 505,347 $ 1,497,058 7 % 670-699 103,191 607,789 576,077 423,618 388,607 1,061,435 3,160,717 15 700-749 243,607 1,472,919 1,260,902 921,338 799,597 2,138,263 6,836,626 33 Greater than or equal to 750 356,837 2,243,052 1,741,306 1,228,477 1,019,491 2,658,276 9,247,439 45 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % FICO Refreshed (2)(3) : Less than 670 $ 64,349 $ 313,569 $ 325,235 $ 290,041 $ 283,988 $ 952,223 $ 2,229,405 11 % 670-699 107,242 573,430 473,331 322,446 271,224 707,135 2,454,808 12 700-749 241,091 1,442,851 1,186,242 813,884 684,467 1,715,802 6,084,337 29 Greater than or equal to 750 337,390 2,247,567 1,877,469 1,364,983 1,157,720 2,988,161 9,973,290 48 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % Seasoning (4) : 1-12 payments $ 419,655 $ 2,510,639 $ 426,229 $ 396,679 $ 392,391 $ 718,899 $ 4,864,492 24 % 13-24 payments — 267,856 2,034,191 254,139 221,863 599,435 3,377,484 16 25-36 payments — — 146,616 1,343,321 250,078 581,741 2,321,756 11 37-48 payments — — — 93,298 978,808 618,454 1,690,560 8 More than 48 payments — — — — 64,660 3,029,214 3,093,874 15 Not yet in repayment 330,417 1,798,922 1,255,241 703,917 489,599 815,578 5,393,674 26 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % 2021 Current period (5) gross charge-offs $ (6) $ (911) $ (4,483) $ (8,116) $ (8,793) $ (32,830) $ (55,139) 2021 Current period (5) recoveries — 43 452 1,009 1,133 5,066 7,703 2021 Current period (5) net charge-offs $ (6) $ (868) $ (4,031) $ (7,107) $ (7,660) $ (27,764) $ (47,436) Total accrued interest by origination vintage $ 8,317 $ 147,329 $ 291,579 $ 258,813 $ 206,734 $ 335,703 $ 1,248,475 ______ (1) Balance represents gross Private Education Loans. (2) Represents the higher credit score of the cosigner or the borrower. (3) Represents the FICO score updated as of the first-quarter 2021. (4) Number of months in active repayment (whether interest only payment, fixed payment, or full principal and interest payment status) for which a scheduled payment was due. (5) Current period refers to period from January 1, 2021 through March 31, 2021. Private Education Loans Held for Investment Credit Quality Indicators December 31, 2020 Year of Origination 2020 (1) 2019 (1) 2018 (1) 2017 (1) 2016 (1) 2015 and Prior (1) Total (1) % of Balance Cosigners: With cosigner $ 2,915,328 $ 3,467,219 $ 2,556,400 $ 2,262,635 $ 1,977,952 $ 4,198,748 $ 17,378,282 88 % Without cosigner 527,437 559,629 384,111 277,159 211,270 391,449 2,351,055 12 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % FICO at Origination (2) : Less than 670 $ 195,214 $ 290,711 $ 225,276 $ 197,948 $ 162,413 $ 369,609 $ 1,441,171 7 % 670-699 464,785 594,950 441,357 407,394 351,303 771,477 3,031,266 16 700-749 1,111,373 1,310,390 967,802 846,983 740,028 1,533,517 6,510,093 33 Greater than or equal to 750 1,671,393 1,830,797 1,306,076 1,087,469 935,478 1,915,594 8,746,807 44 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % FICO Refreshed (2)(3) : Less than 670 $ 240,154 $ 331,229 $ 301,784 $ 298,195 $ 293,077 $ 734,599 $ 2,199,038 11 % 670-699 438,665 493,135 336,966 283,906 231,759 504,779 2,289,210 12 700-749 1,102,666 1,248,806 871,677 734,222 603,160 1,220,468 5,780,999 29 Greater than or equal to 750 1,661,280 1,953,678 1,430,084 1,223,471 1,061,226 2,130,351 9,460,090 48 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % Seasoning (4) : 1-12 payments $ 2,068,517 $ 600,038 $ 469,143 $ 472,258 $ 381,197 $ 507,343 $ 4,498,496 23 % 13-24 payments 163 2,096,635 383,977 223,332 217,379 425,345 3,346,831 17 25-36 payments — — 1,353,567 370,250 181,940 439,337 2,345,094 12 37-48 payments — — — 965,476 351,433 402,552 1,719,461 9 More than 48 payments — — — — 729,510 2,310,905 3,040,415 15 Not yet in repayment 1,374,085 1,330,175 733,824 508,478 327,763 504,715 4,779,040 24 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % 2020 gross charge-offs (5) $ (1,087) $ (10,940) $ (27,000) $ (35,851) $ (36,416) $ (94,032) $ (205,326) 2020 recoveries (5) 42 636 2,274 3,585 4,284 13,200 24,021 2020 net charge-offs (5) $ (1,045) $ (10,304) $ (24,726) $ (32,266) $ (32,132) $ (80,832) $ (181,305) Total accrued interest by origination vintage $ 90,438 $ 265,688 $ 252,251 $ 209,178 $ 141,094 $ 210,247 $ 1,168,896 ______ (1) Balance represents gross Private Education Loans. (2) Represents the higher credit score of the cosigner or the borrower. (3) Represents the FICO score updated as of the fourth-quarter 2020. (4) Number of months in active repayment (whether interest only payment, fixed payment, or full principal and interest payment status) for which a scheduled payment was due. (5) For period from January 1, 2020 through December 31, 2020. Delinquencies - Private Education Loans Held for Investment The following tables provide information regarding the loan status of our Private Education Loans, held for investment, by year of origination. Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period (but, for purposes of the following tables, do not include those loans while they are in forbearance). For the periods presented below, we updated our delinquency bucket periods to conform with the delinquency bucket periods defined by the FFIEC. Private Education Loans Held for Investment Delinquencies by Origination Vintage March 31, 2021 2021 2020 2019 2018 2017 2016 and Prior Total Loans in-school/grace/deferment (1)(2) $ 330,417 $ 1,798,922 $ 1,255,241 $ 703,917 $ 489,599 $ 815,578 $ 5,393,674 Loans in forbearance (1)(3) 1,186 21,471 89,409 93,513 103,807 260,841 570,227 Loans in repayment (1) : Loans current 418,103 2,747,747 2,491,380 1,955,468 1,755,863 5,102,866 14,471,427 Loans delinquent 30-59 days (4) 366 6,587 14,015 19,145 24,043 88,587 152,743 Loans delinquent 60-89 days (4) — 1,747 7,654 11,064 13,166 52,759 86,390 Loans 90 days or greater past due (4) — 943 4,578 8,247 10,921 42,690 67,379 Total Private Education Loans in repayment 418,469 2,757,024 2,517,627 1,993,924 1,803,993 5,286,902 14,777,939 Total Private Education Loans, gross 750,072 4,577,417 3,862,277 2,791,354 2,397,399 6,363,321 20,741,840 Private Education Loans deferred origination costs and unamortized premium/(discount) 5,487 19,922 12,925 7,977 6,153 12,004 64,468 Total Private Education Loans 755,559 4,597,339 3,875,202 2,799,331 2,403,552 6,375,325 20,806,308 Private Education Loans allowance for losses (35,515) (252,247) (239,917) (169,296) (140,894) (335,506) (1,173,375) Private Education Loans, net $ 720,044 $ 4,345,092 $ 3,635,285 $ 2,630,035 $ 2,262,658 $ 6,039,819 $ 19,632,933 Percentage of Private Education Loans in repayment 55.8 % 60.2 % 65.2 % 71.4 % 75.2 % 83.1 % 71.2 % Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment 0.1 % 0.3 % 1.0 % 1.9 % 2.7 % 3.5 % 2.1 % Loans in forbearance as a percentage of loans in repayment and forbearance 0.3 % 0.8 % 3.4 % 4.5 % 5.4 % 4.7 % 3.7 % _______ (1) For some students, going back to school in the fall was not an option because of the pandemic, or for other reasons. Therefore, some students are taking a “gap year” before returning to school. In 2020, for those students that had unexpectedly separated from school, we provided an extension of time through fall 2021 to re-enroll, before beginning their grace period that occurs prior to entering full principal and interest repayment status. At March 31, 2021, the loans in the “in-school/grace/deferment” category above include $273 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At March 31, 2021, the loans in the “in forbearance” category above include $29 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At March 31, 2021, the loans in the “in repayment” category above include $482 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. (2) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation). (3) Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. (4) The period of delinquency is based on the number of days scheduled payments are contractually past due. Private Education Loans Held for Investment Delinquencies by Origination Vintage December 31, 2020 2020 2019 2018 2017 2016 2015 and Prior Total Loans in-school/grace/deferment (1)(2) $ 1,374,085 $ 1,330,175 $ 733,824 $ 508,478 $ 327,763 $ 504,715 $ 4,779,040 Loans in forbearance (1)(3) 16,159 92,677 110,319 118,946 109,073 198,302 645,476 Loans in repayment (1) : Loans current 2,043,033 2,573,228 2,045,012 1,850,539 1,685,572 3,701,564 13,898,948 Loans delinquent 30-59 days (4) 6,400 16,983 26,934 30,771 33,040 91,400 205,528 Loans delinquent 60-89 days (4) 2,628 9,143 15,026 18,121 19,064 55,661 119,643 Loans 90 days or greater past due (4) 460 4,642 9,396 12,939 14,710 38,555 80,702 Total Private Education Loans in repayment 2,052,521 2,603,996 2,096,368 1,912,370 1,752,386 3,887,180 14,304,821 Total Private Education Loans, gross 3,442,765 4,026,848 2,940,511 2,539,794 2,189,222 4,590,197 19,729,337 Private Education Loans deferred origination costs and unamortized premium/(discount) 21,129 13,933 8,671 6,708 5,721 7,313 63,475 Total Private Education Loans 3,463,894 4,040,781 2,949,182 2,546,502 2,194,943 4,597,510 19,792,812 Private Education Loans allowance for losses (210,875) (298,776) (218,136) (184,265) (150,150) (293,642) (1,355,844) Private Education Loans, net $ 3,253,019 $ 3,742,005 $ 2,731,046 $ 2,362,237 $ 2,044,793 $ 4,303,868 $ 18,436,968 Percentage of Private Education Loans in repayment 59.6 % 64.7 % 71.3 % 75.3 % 80.0 % 84.7 % 72.5 % Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment 0.5 % 1.2 % 2.4 % 3.2 % 3.8 % 4.8 % 2.8 % Loans in forbearance as a percentage of loans in repayment and forbearance 0.8 % 3.4 % 5.0 % 5.9 % 5.9 % 4.9 % 4.3 % _______ (1) For some students, going back to school in the fall was not an option because of the pandemic, or for other reasons. Therefore, some students are taking a “gap year” before returning to school. In 2020, for those students that had unexpectedly separated from school, we provided an extension of time through fall 2021 to re-enroll, before beginning their grace period that occurs prior to entering full principal and interest repayment status. At December 31, 2020, the loans in the “in-school/grace/deferment” category above include $401 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At December 31, 2020, the loans in the “in forbearance” category above include $30 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At December 31, 2020, the loans in the “in repayment” category above include $609 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. (2) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation). (3) Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. (4) The period of delinquency is based on the number of days scheduled payments are contractually past due. Accrued Interest Receivable The following table provides information regarding accrued interest receivable on our Private Education Loans. The table also discloses the amount of accrued interest on loans greater than 90 days past due as compared to our allowance for uncollectible interest on loans making full interest payments. The majority of the total accrued interest receivable represents accrued interest on deferred loans where no payments are due while the borrower is in school and fixed-pay loans where the borrower makes a $25 monthly payment that is smaller than the interest accruing on the loan in that month. The accrued interest on these loans will be capitalized to the balance of the loans when the borrower exits the grace period after separation from school. The allowance for this portion of interest is included in our loan loss reserve. The allowance for uncollectible interest exceeds the amount of accrued interest on our 90 days past due Private Education Loan portfolio for all periods presented. Private Education Loans Accrued Interest Receivable Total Interest Receivable 90 Days and Greater Past Due Allowance for Uncollectible Interest March 31, 2021 $ 1,248,475 $ 3,695 $ 4,405 December 31, 2020 $ 1,168,895 $ 4,354 $ 4,467 |
Unfunded Loan Commitments
Unfunded Loan Commitments | 3 Months Ended |
Mar. 31, 2021 | |
Credit Loss [Abstract] | |
Unfunded Loan Commitments | Unfunded Loan Commitments When we approve a Private Education Loan at the beginning of an academic year, that approval may cover the borrowing for the entire academic year. As such, we do not always disburse the full amount of the loan at the time of such approval, but instead have a commitment to fund a portion of the loan at a later date (usually at the start of the second semester or subsequent trimesters). We estimate expected credit losses over the contractual period in which we are exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by us. See Notes to Consolidated Financial Statements, Note 2, “Significant Accounting Policies - Allowance for Credit Losses 2020 — Off-Balance Sheet Exposure for Contractual Loan Commitments” in our 2020 Form 10-K for additional information. At March 31, 2021, we had $457 million of outstanding contractual loan commitments that we expect to fund during the remainder of the 2020/2021 academic year. The tables below summarize the activity in the allowance recorded to cover lifetime expected credit losses on the unfunded commitments, which is recorded in “Other Liabilities” on the consolidated balance sheets, as well as the activity in the unfunded commitments balance. Three Months Ended March 31, 2021 2020 Allowance Unfunded Commitments Allowance Unfunded Commitments Beginning Balance $ 110,044 $ 1,673,018 $ 2,481 $ 1,910,603 Day 1 adjustment for the adoption of CECL — — 115,758 — Balance at January 1 110,044 1,673,018 118,239 1,910,603 Provision/New commitments - net (1) 40,197 843,161 49,561 834,946 Other provision items (3,994) — 3,982 — Transfer - funded loans (2) (126,880) (2,058,726) (142,075) (2,295,742) Ending Balance $ 19,367 $ 457,453 $ 29,707 $ 449,807 ________________ (1) Net of expirations of commitments unused. (2) When a loan commitment is funded, its related liability for credit losses (which originally was recorded as a provision for unfunded commitments) is transferred to the allowance for credit losses. The unfunded commitments disclosed above represent the total amount of outstanding unfunded commitments at each period end. However, historically not all of these commitments are funded prior to the expiration of the commitments. We estimate the amount of commitments expected to be funded in calculating the reserve for unfunded commitments. The amount we expect to fund and use in our calculation of the reserve for unfunded commitments will change period to period based upon the loan characteristics of the underlying commitments. |
Deposits
Deposits | 3 Months Ended |
Mar. 31, 2021 | |
Banking and Thrift, Other Disclosures [Abstract] | |
Deposits | Deposits The following table summarizes total deposits at March 31, 2021 and December 31, 2020. March 31, December 31, 2021 2020 Deposits - interest bearing $ 22,801,323 $ 22,664,899 Deposits - non-interest bearing 1,820 1,140 Total deposits $ 22,803,143 $ 22,666,039 Our total deposits of $22.8 billion were comprised of $12.1 billion in brokered deposits and $10.7 billion in retail and other deposits at March 31, 2021, compared to total deposits of $22.7 billion, which were comprised of $11.9 billion in brokered deposits and $10.8 billion in retail and other deposits, at December 31, 2020. Interest bearing deposits as of March 31, 2021 and December 31, 2020 consisted of retail and brokered non-maturity savings deposits, retail and brokered non-maturity money market deposits (“MMDAs”), and retail and brokered certificates of deposit (“CDs”). Interest bearing deposits include deposits from Educational 529 and Health Savings plans that diversify our funding sources and additional deposits we consider to be core. These and other large omnibus accounts, aggregating the deposits of many individual depositors, represented $7.9 billion and $7.1 billion of our deposit total as of March 31, 2021 and December 31, 2020, respectively. Some of our deposit products are serviced by third-party providers. Placement fees associated with the brokered CDs are amortized into interest expense using the effective interest rate method. We recognized placement fee expense of $4 million and $5 million in the three months ended March 31, 2021 and 2020, respectively. Fees paid to third-party brokers related to brokered CDs were none and $2 million for the three months ended March 31, 2021 and 2020, respectively. Interest bearing deposits at March 31, 2021 and December 31, 2020 are summarized as follows: March 31, 2021 December 31, 2020 Amount Qtr.-End Weighted Average Stated Rate (1) Amount Year-End Weighted Average Stated Rate (1) Money market $ 10,951,595 0.68 % $ 10,159,657 0.83 % Savings 955,547 0.42 907,976 0.55 Certificates of deposit 10,894,181 1.24 11,597,266 1.34 Deposits - interest bearing $ 22,801,323 $ 22,664,899 ____________ (1) Includes the effect of interest rate swaps in effective hedge relationships. |
Borrowings
Borrowings | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings Outstanding borrowings consist of unsecured debt and secured borrowings issued through our term asset-backed securitization (“ABS”) program and our Private Education Loan multi-lender secured borrowing facility (the “Secured Borrowing Facility”). For additional information regarding our borrowings, see Notes to Consolidated Financial Statements, Note 11, “Borrowings” in our 2020 Form 10-K. The following table summarizes our borrowings at March 31, 2021 and December 31, 2020. March 31, 2021 December 31, 2020 Short-Term Long-Term Total Short-Term Long-Term Total Unsecured borrowings: Unsecured debt (fixed-rate) $ — $ 693,099 $ 693,099 $ — $ 692,879 $ 692,879 Total unsecured borrowings — 693,099 693,099 — 692,879 692,879 Secured borrowings: Private Education Loan term securitizations: Fixed-rate — 3,109,329 3,109,329 — 3,261,233 3,261,233 Variable-rate — 1,116,242 1,116,242 — 1,235,105 1,235,105 Total Private Education Loan term securitizations — 4,225,571 4,225,571 — 4,496,338 4,496,338 Secured Borrowing Facility — — — — — — Total secured borrowings — 4,225,571 4,225,571 — 4,496,338 4,496,338 Total $ — $ 4,918,670 $ 4,918,670 $ — $ 5,189,217 $ 5,189,217 Short-term Borrowings Secured Borrowing Facility On February 17, 2021, we amended our Secured Borrowing Facility to extend the maturity of the facility. The amount that can be borrowed under the facility is $2 billion. We hold 100 percent of the residual interest in the Secured Borrowing Facility trust. Under the Secured Borrowing Facility, we incur financing costs on unused borrowing capacity and on outstanding advances. The amended Secured Borrowing Facility extended the revolving period, during which we may borrow, repay and reborrow funds, until February 16, 2022. The scheduled amortization period, during which amounts outstanding under the Secured Borrowing Facility must be repaid, ends on February 16, 2023 (or earlier, if certain material adverse events occur). At both March 31, 2021 and December 31, 2020, there were no secured borrowings outstanding under the Secured Borrowing Facility. Long-term Borrowings Secured Financings at Issuance The following summarizes our secured financings issued in 2020 and in 2021 through March 31, 2021: Issue Date Issued Total Issued Weighted Average Cost of Funds (1) Weighted Average Life Private Education: 2020-A February 2020 $ 636,000 1-month LIBOR plus 0.88% 4.18 2020-B August 2020 707,000 1-month LIBOR plus 1.30% 4.14 Total notes issued in 2020 $ 1,343,000 Total loan and accrued interest amount securitized at inception in 2020 (2) $ 1,463,230 ____________ (1) Represents LIBOR equivalent cost of funds for floating and fixed-rate bonds, excluding issuance costs. (2) At March 31, 2021, $1.29 billion of our Private Education Loans, including $1.20 billion of principal and $86 million in capitalized interest, were encumbered related to these transactions. Consolidated Funding Vehicles We consolidate our financing entities that are VIEs as a result of our being the entities’ primary beneficiary. As a result, these financing VIEs are accounted for as secured borrowings. March 31, 2021 Debt Outstanding Carrying Amount of Assets Securing Debt Outstanding Short-Term Long-Term Total Loans Restricted Cash Other Assets (1) Total Secured borrowings: Private Education Loan term securitizations $ — $ 4,225,571 $ 4,225,571 $ 5,343,243 $ 164,708 $ 355,949 $ 5,863,900 Secured Borrowing Facility — — — — — 2,496 2,496 Total $ — $ 4,225,571 $ 4,225,571 $ 5,343,243 $ 164,708 $ 358,445 $ 5,866,396 ____ (1) Other assets primarily represent accrued interest receivable. December 31, 2020 Debt Outstanding Carrying Amount of Assets Securing Debt Outstanding Short-Term Long-Term Total Loans Restricted Cash Other Assets (1) Total Secured borrowings: Private Education Loan term securitizations $ — $ 4,496,338 $ 4,496,338 $ 5,661,123 $ 154,417 $ 356,967 $ 6,172,507 Secured Borrowing Facility — — — — — 436 436 Total $ — $ 4,496,338 $ 4,496,338 $ 5,661,123 $ 154,417 $ 357,403 $ 6,172,943 ____ (1) Other assets primarily represent accrued interest receivable. Unconsolidated VIEs Private Education Loan Securitizations Our unconsolidated VIEs include variable interests that we hold in certain securitization trusts created by the sale of our Private Education Loans to unaffiliated third parties in the first quarters of 2020 and 2021. We remained the servicer of these loans pursuant to applicable servicing agreements executed in connection with the sales, and we are also the administrator of these trusts. Additionally, we own 5 percent of the securities issued by the trusts to meet risk retention requirements. 2021-A Transaction On February 9, 2021, we closed an SMB Private Education Loan Trust 2021-A term ABS transaction (the “2021-A Transaction”), in which the unaffiliated third-party sold to the trust approximately $2.5 billion of Private Education Loans that the third-party seller previously purchased from us on January 8, 2021. In the 2021-A Transaction, we were the sponsor, servicer and administrator, and the seller of an additional $130 million of Private Education Loans into the trust. The sale of such additional loans qualified for sale treatment and removed these loans from our balance sheet on the settlement date of the 2021-A Transaction and we recorded an $18 million gain on sale associated with this transaction. In connection with the 2021-A Transaction settlement, we retained a 5 percent vertical risk retention interest (i.e., 5 percent of each class issued in the securitization). We classified those vertical risk retention interests related to the 2021-A Transaction as available-for-sale investments, except for the interest in the residual class, which we classified as a trading investment recorded at fair value with changes recorded through earnings. The table below provides a summary of our exposure related to our unconsolidated VIEs. March 31, 2021 December 31, 2020 Debt Interests (1) Equity Interests (2) Total Exposure Debt Interests (1) Equity Interests (2) Total Exposure Private Education Loan term securitizations $ 199,135 $ 30,594 $ 229,729 $ 68,908 $ 16,923 $ 85,831 ____ (1) Vertical risk retention interest classified as available-for-sale investment. (2) Vertical risk retention interest classified as trading investment. Other Borrowing Sources We maintain discretionary uncommitted Federal Funds lines of credit with various correspondent banks, which totaled $125 million at March 31, 2021. The interest rate we are charged on these lines of credit is priced at Fed Funds plus a spread at the time of borrowing and is payable daily. We did not utilize these lines of credit in the three months ended March 31, 2021 or in the year ended December 31, 2020. We established an account at the FRB to meet eligibility requirements for access to the Primary Credit borrowing facility at the FRB’s Discount Window (the “Window”). The Primary Credit borrowing facility is a lending program available to depository institutions that are in generally sound financial condition. All borrowings at the Window must be fully collateralized. We can pledge asset-backed and mortgage-backed securities, as well as FFELP Loans and Private Education Loans, to the FRB as collateral for borrowings at the Window. Generally, collateral value is assigned based on the estimated fair value of the pledged assets. At March 31, 2021 and December 31, 2020, the value of our pledged collateral at the FRB totaled $3.2 billion and $3.8 billion, respectively. The interest rate charged to us is the discount rate set by the FRB. We did not utilize this facility in the three months ended March 31, 2021 or in the year ended December 31, 2020. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments Risk Management Strategy We maintain an overall interest rate risk management strategy that incorporates the use of derivative instruments to reduce the economic effect of interest rate changes. Our goal is to manage interest rate sensitivity by modifying the repricing frequency and underlying index characteristics of certain balance sheet assets or liabilities so any adverse impacts related to movements in interest rates are managed within low to moderate limits. As a result of interest rate fluctuations, hedged balance sheet positions will appreciate or depreciate in market value or create variability in cash flows. Income or loss on the derivative instruments linked to the hedged item will generally offset the effect of this unrealized appreciation or depreciation or volatility in cash flows for the period the item is being hedged. We view this strategy as a prudent management of interest rate risk. Please refer to Notes to Consolidated Financial Statements, Note 12, “Derivative Financial Instruments” in our 2020 Form 10-K for a full discussion of our risk management strategy. Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) requires all standardized derivatives, including most interest rate swaps, to be submitted for clearing to central counterparties to reduce counterparty risk. Two of the central counterparties we use are the Chicago Mercantile Exchange (“CME”) and the London Clearing House (“LCH”). All variation margin payments on derivatives cleared through the CME and LCH are accounted for as legal settlement. As of March 31, 2021, $8.2 billion notional of our derivative contracts were cleared on the CME and $0.4 billion were cleared on the LCH. The derivative contracts cleared through the CME and LCH represent 95.6 percent and 4.4 percent, respectively, of our total notional derivative contracts of $8.6 billion at March 31, 2021. For derivatives cleared through the CME and LCH, the net gain (loss) position includes the variation margin amounts as settlement of the derivative and not collateral against the fair value of the derivative. The amount of variation margin included as settlement as of March 31, 2021 was $(157) million and $15 million for the CME and LCH, respectively. Changes in fair value for derivatives not designated as hedging instruments are presented as realized gains (losses). Our exposure to the counterparty is limited to the value of the derivative contracts in a gain position less any collateral held and plus any collateral posted. When there is a net negative exposure, we consider our exposure to the counterparty to be zero. At March 31, 2021 and December 31, 2020, we had a net positive exposure (derivative gain positions to us, less collateral held by us and plus collateral posted with counterparties) related to derivatives of $24 million and $43 million, respectively. Summary of Derivative Financial Statement Impact The following tables summarize the fair values and notional amounts of all derivative instruments at March 31, 2021 and December 31, 2020, and their impact on earnings and other comprehensive income for the three months ended March 31, 2021 and March 31, 2020. Please refer to Notes to Consolidated Financial Statements, Note 12, “Derivative Financial Instruments” in our 2020 Form 10-K for a full discussion of cash flow hedges, fair value hedges, and trading activities. Impact of Derivatives on the Consolidated Balance Sheets Cash Flow Hedges Fair Value Hedges Trading Total March 31, December March 31, December March 31, December March 31, December 2021 2020 2021 2020 2021 2020 2021 2020 Fair Values (1) Hedged Risk Exposure Derivative Assets: (2) Interest rate swaps Interest rate $ 809 $ — $ 245 $ 594 $ — $ 135 $ 1,054 $ 729 Derivative Liabilities: (2) Interest rate swaps Interest rate — (287) — — (451) — (451) (287) Total net derivatives $ 809 $ (287) $ 245 $ 594 $ (451) $ 135 $ 603 $ 442 ___________ (1) Fair values reported include variation margin as legal settlement of the derivative contract. Assets and liabilities are presented without consideration of master netting agreements. Derivatives are carried on the balance sheet based on net position by counterparty under master netting agreements and classified in other assets or other liabilities depending on whether in a net positive or negative position. (2) The following table reconciles gross positions with the impact of master netting agreements to the balance sheet classification: Other Assets Other Liabilities March 31, December 31, March 31, December 31, 2021 2020 2021 2020 Gross position (1) $ 1,054 $ 729 $ (451) $ (287) Impact of master netting agreement (451) (176) 451 176 Derivative values with impact of master netting agreements (as carried on balance sheet) 603 553 — (111) Cash collateral pledged (2) 23,592 42,874 — — Net position $ 24,195 $ 43,427 $ — $ (111) __________ (1) Gross position amounts include accrued interest and variation margin as legal settlement of the derivative contract. (2) Cash collateral pledged excludes amounts that represent legal settlement of the derivative contracts. Cash Flow Fair Value Trading Total March 31, December 31, March 31, December 31, March 31, December 31, March 31, December 31, 2021 2020 2021 2020 2021 2020 2021 2020 Notional Values Interest rate swaps $ 1,535,718 $ 1,018,976 $ 4,637,654 $ 4,845,543 $ 2,393,364 $ 2,693,364 $ 8,566,736 $ 8,557,883 As of March 31, 2021 and December 31, 2020, the following amounts were recorded on the consolidated balance sheet related to cumulative basis adjustments for fair value hedges: Line Item in the Balance Sheet in Which the Hedged Item is Included: Carrying Amount of the Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) March 31, December 31, March 31, December 31, 2021 2020 2021 2020 Deposits $ (4,754,979) $ (4,992,867) $ (122,959) $ (154,235) Impact of Derivatives on the Consolidated Statements of Income Three Months Ended 2021 2020 Fair Value Hedges Interest rate swaps: Interest recognized on derivatives $ 22,610 $ 4,623 Hedged items recorded in interest expense 31,275 (143,248) Derivatives recorded in interest expense (31,251) 144,183 Total $ 22,634 $ 5,558 Cash Flow Hedges Interest rate swaps: Amount of gain (loss) reclassified from accumulated other comprehensive income into interest expense $ (5,269) $ (1,528) Total $ (5,269) $ (1,528) Trading Interest rate swaps: Change in fair value of future interest payments recorded in earnings $ (10,864) $ 42,312 Total (10,864) 42,312 Total $ 6,501 $ 46,342 Impact of Derivatives on the Statements of Changes in Stockholders’ Equity Three Months Ended March 31, 2021 2020 Amount of gain (loss) recognized in other comprehensive income (loss) $ 18,154 $ (47,222) Less: amount of gain (loss) reclassified in interest expense (5,269) (1,528) Total change in other comprehensive income (loss) for unrealized gains (losses) on derivatives, before income tax (expense) benefit $ 23,423 $ (45,694) Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate deposits. During the next 12 months, we estimate that $20 million will be reclassified as an increase to interest expense. Cash Collateral As of March 31, 2021, cash collateral held and pledged excludes amounts that represent legal settlement of the derivative contracts held with the CME and LCH. There was no cash collateral held related to derivative exposure between us and our derivatives counterparties at March 31, 2021 and December 31, 2020, respectively. Cash collateral pledged related to derivative exposure between us and our derivatives counterparties was $24 million and $43 million at March 31, 2021 and December 31, 2020, respectively. Collateral pledged is recorded in “Other interest-earning assets” on the consolidated balance sheets. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity The following table summarizes our common share repurchases and issuances. Three Months Ended (Shares and per share amounts in actuals) 2021 2020 Common stock repurchased under repurchase programs (1)(2)(3) 48,702,830 47,736,847 Average purchase price per share (4) $ 15.75 $ 9.66 Shares repurchased related to employee stock-based compensation plans (5) 1,059,980 1,105,119 Average purchase price per share $ 13.50 $ 10.98 Common shares issued (6) 2,826,387 2,837,562 __________________ (1) Common shares purchased under our share repurchase programs. We have utilized all capacity under our 2020 Share Repurchase Program. There was $734 million of capacity remaining under the 2021 Share Repurchase Program at March 31, 2021. (2) For the three months ended March 31, 2021 and 2020, the amount includes 13 million shares and 45 million shares, respectively, related to the accelerated share repurchase agreement described below. (3) For the three months ended March 31, 2021, the amount includes 28.5 million shares related to the settlement of our common stock tender offer described below. (4) Average purchase price per share includes purchase commission costs. (5) Comprised of shares withheld from stock option exercises and vesting of restricted stock for employees’ tax withholding obligations and shares tendered by employees to satisfy option exercise costs. (6) Common shares issued under our various compensation and benefit plans. The closing price of our common stock on the NASDAQ Global Select Market on March 31, 2021 was $17.97. Dividend and Share Repurchases In both March 2021 and March 2020, we paid a common stock dividend of $0.03 per common share. The January 22, 2020 share repurchase program (the “2020 Share Repurchase Program”), which was effective upon announcement and expires on January 21, 2022, permitted us to repurchase from time to time shares of common stock up to an aggregate repurchase price not to exceed $600 million. Under the authority of the 2020 Share Repurchase Program, on March 10, 2020, we entered into an accelerated share repurchase agreement (“ASR”) with a third-party financial institution under which we paid $525 million for an upfront delivery of our common stock and a forward agreement. On March 11, 2020, the third-party financial institution delivered to us approximately 45 million shares. The final total actual number of shares of common stock delivered to us pursuant to the forward agreement was based generally upon a volume-weighted average price at which the shares of our common stock traded during the regular trading sessions on the NASDAQ Global Select Market during the term of the ASR. The transactions were accounted for as equity transactions and were included in treasury stock when the shares were received, at which time there was an immediate reduction in the weighted average common shares calculation for basic and diluted earnings per share. On January 26, 2021, we completed the ASR and upon final settlement on January 28, 2021, we received an additional 13 million shares. In total, we repurchased 58 million shares under the ASR at an average price per share of $9.01. Under the 2020 Share Repurchase Program, we also repurchased an additional 4 million shares of common stock for $75 million in the three months ended March 31, 2021. We have now utilized all capacity under the 2020 Share Repurchase Program. On January 27, 2021, we announced a share repurchase program (the “2021 Share Repurchase Program”), which was effective upon announcement and expires on January 26, 2023, and permits us to repurchase shares of our common stock from time to time up to an aggregate repurchase price not to exceed $1.25 billion. Under the 2021 Share Repurchase Program, we repurchased 31 million shares of common stock for $517 million in the three months ended March 31, 2021. (Those amounts include the shares repurchased under the Tender Offer described below.) There was $734 million of capacity remaining under the 2021 Share Repurchase Program at March 31, 2021. Repurchases under our share repurchase programs may occur from time to time and through a variety of methods, including tender offers, open market repurchases, repurchases effected through Rule 10b5-1 trading plans, negotiated block purchases, accelerated share repurchase programs, or other similar transactions. The timing and volume of any repurchases under the 2021 Share Repurchase Program will be subject to market conditions, and there can be no guarantee that the Company will repurchase up to the limit of its share repurchase programs or at all. Common Stock Tender Offer On February 2, 2021, we announced the commencement of a “modified Dutch Auction” tender offer (the “Tender Offer”) to purchase up to $1 billion in aggregate purchase price of our outstanding shares of common stock, par value $0.20 per share. Pursuant to the Tender Offer, we repurchased 28.5 million shares at a price of $16.50 per share. The purchase of shares settled on March 16, 2021, for an aggregate cost of approximately $472 million, including fees and expenses related to the Tender Offer. We cancelled the 28.5 million shares purchased in connection with the Tender Offer. This cancellation decreased the balances of common stock by $6 million and of additional paid-in capital by $466 million, respectively. Share Repurchases under our Rule 10b5-1 trading plan |
Earnings per Common Share
Earnings per Common Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share | Earnings per Common Share Basic earnings per common share (“EPS”) are calculated using the weighted average number of shares of common stock outstanding during each period. A reconciliation of the numerators and denominators of the basic and diluted EPS calculations follows. Three Months Ended March 31, (In thousands, except per share data) 2021 2020 Numerator: Net income $ 641,207 $ 362,173 Preferred stock dividends 1,201 3,464 Net income attributable to SLM Corporation common stock $ 640,006 $ 358,709 Denominator: Weighted average shares used to compute basic EPS 361,042 409,786 Effect of dilutive securities: Dilutive effect of stock options, restricted stock, restricted stock units, performance stock units and Employee Stock Purchase Plan (“ESPP”) (1)(2) 5,198 2,969 Weighted average shares used to compute diluted EPS 366,240 412,755 Basic earnings per common share attributable to SLM Corporation $ 1.77 $ 0.88 Diluted earnings per common share attributable to SLM Corporation $ 1.75 $ 0.87 ________________ (1) Includes the potential dilutive effect of additional common shares that are issuable upon exercise of outstanding stock options, restricted stock, restricted stock units, performance stock units and the outstanding commitment to issue shares under the ESPP, determined by the treasury stock method. (2) |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We use estimates of fair value in applying various accounting standards for our consolidated financial statements. We categorize our fair value estimates based on a hierarchical framework associated with three levels of price transparency utilized in measuring financial instruments at fair value. For additional information regarding our policies for determining fair value and the hierarchical framework, see Notes to Consolidated Financial Statements, Note 2, “Significant Accounting Policies - Fair Value Measurement” in our 2020 Form 10-K. During the three months ended March 31, 2021, there were no significant transfers of financial instruments between levels or changes in our methodology or assumptions used to value our financial instruments. The following table summarizes the valuation of our financial instruments that are marked to fair value on a recurring basis. Fair Value Measurements on a Recurring Basis March 31, 2021 December 31, 2020 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets Trading investments $ — $ — $ 30,594 $ 30,594 $ — $ — $ 16,923 $ 16,923 Available-for-sale investments — 2,115,885 — 2,115,885 — 1,996,634 — 1,996,634 Derivative instruments — 1,054 — 1,054 — 729 — 729 Total $ — $ 2,116,939 $ 30,594 $ 2,147,533 $ — $ 1,997,363 $ 16,923 $ 2,014,286 Liabilities Derivative instruments $ — $ (451) $ — $ (451) $ — $ (287) $ — $ (287) Total $ — $ (451) $ — $ (451) $ — $ (287) $ — $ (287) The following table summarizes the fair values of our financial assets and liabilities, including derivative financial instruments. March 31, 2021 December 31, 2020 Fair Carrying Difference Fair Carrying Difference Earning assets: Loans held for investment, net: Private Education Loans $ 22,889,920 $ 19,632,933 $ 3,256,987 $ 22,124,171 $ 18,436,968 $ 3,687,203 FFELP Loans 738,579 725,300 13,279 748,657 735,208 13,449 Credit Cards 11,332 10,054 1,278 12,249 10,967 1,282 Loans held for sale — — — 3,226,029 2,885,640 340,389 Cash and cash equivalents 6,207,001 6,207,001 — 4,455,292 4,455,292 — Trading investments 30,594 30,594 — 16,923 16,923 — Available-for-sale investments 2,115,885 2,115,885 — 1,996,634 1,996,634 — Accrued interest receivable 1,373,593 1,264,960 108,633 1,527,816 1,387,305 140,511 Tax indemnification receivable 15,678 15,678 — 18,492 18,492 — Derivative instruments 1,054 1,054 — 729 729 — Total earning assets $ 33,383,636 $ 30,003,459 $ 3,380,177 $ 34,126,992 $ 29,944,158 $ 4,182,834 Interest-bearing liabilities: Money-market and savings accounts $ 11,961,848 $ 11,907,142 $ (54,706) $ 11,136,560 $ 11,067,633 $ (68,927) Certificates of deposit 11,048,527 10,894,181 (154,346) 11,799,223 11,597,266 (201,957) Long-term borrowings 5,117,766 4,918,670 (199,096) 5,398,309 5,189,217 (209,092) Accrued interest payable 79,231 79,231 — 60,272 60,272 — Derivative instruments 451 451 — 287 287 — Total interest-bearing liabilities $ 28,207,823 $ 27,799,675 $ (408,148) $ 28,394,651 $ 27,914,675 $ (479,976) Excess of net asset fair value over carrying value $ 2,972,029 $ 3,702,858 Please refer to Notes to Consolidated Financial Statements, Note 16, “Fair Value Measurements” in our 2020 Form 10-K for a full discussion of the methods and assumptions used to estimate the fair value of each class of financial instruments. |
Regulatory Capital
Regulatory Capital | 3 Months Ended |
Mar. 31, 2021 | |
Banking and Thrift, Other Disclosures [Abstract] | |
Regulatory Capital | Regulatory Capital Sallie Mae Bank (the “Bank”) is subject to various regulatory capital requirements administered by the FDIC and the Utah Department of Financial Institutions (“UDFI”). Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material adverse effect on our business, results of operations and financial condition. Under the FDIC’s regulations implementing the Basel III capital framework (“U.S. Basel III”) and the regulatory framework for prompt corrective action, the Bank must meet specific capital standards that involve quantitative measures of its assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank’s capital amounts and its classification under the prompt corrective action framework are also subject to qualitative judgments by the regulators about components of capital, risk weightings, and other factors. The Bank is subject to the following minimum capital ratios under U.S. Basel III: a Common Equity Tier 1 risk-based capital ratio of 4.5 percent, a Tier 1 risk-based capital ratio of 6.0 percent, a Total risk-based capital ratio of 8.0 percent, and a Tier 1 leverage ratio of 4.0 percent. In addition, the Bank is subject to a Common Equity Tier 1 capital conservation buffer of greater than 2.5 percent. Failure to maintain the buffer will result in restrictions on the Bank’s ability to make capital distributions, including the payment of dividends, and to pay discretionary bonuses to executive officers. Including the buffer, the Bank is required to maintain the following capital ratios under U.S. Basel III in order to avoid such restrictions: a Common Equity Tier 1 risk-based capital ratio of greater than 7.0 percent, a Tier 1 risk-based capital ratio of greater than 8.5 percent, and a Total risk-based capital ratio of greater than 10.5 percent. To qualify as “well capitalized” under the prompt corrective action framework for insured depository institutions, the Bank must maintain a Common Equity Tier 1 risk-based capital ratio of at least 6.5 percent, a Tier 1 risk-based capital ratio of at least 8.0 percent, a Total risk-based capital ratio of at least 10.0 percent, and a Tier 1 leverage ratio of at least 5.0 percent. On August 26, 2020, the FDIC and other federal banking agencies published a final rule that provides those banking organizations that adopted CECL during the 2020 calendar year with the option to delay for two years, and then phase in over the following three years, the effects on regulatory capital of CECL relative to the incurred loss methodology. We have elected to use this option. The final rule is substantially similar to an interim final rule issued on March 27, 2020. Under this final rule, because we have elected to use the deferral option, the regulatory capital impact of our transition adjustments recorded on January 1, 2020 from the adoption of CECL will be deferred for two years. In addition, from January 1, 2020 through the end of the two-year deferral period, 25 percent of the ongoing impact of CECL on our allowance for credit losses, retained earnings, and average total consolidated assets, each as reported for regulatory capital purposes, will be added to the deferred transition amounts (“adjusted transition amounts”) and deferred for the two-year period. At the conclusion of the two-year period (i.e., beginning January 1, 2022), the adjusted transition amounts will be phased in for regulatory capital purposes at a rate of 25 percent per year, with the phased-in amounts included in regulatory capital at the beginning of each year. Our January 1, 2020 CECL transition amounts increased the allowance for credit losses by $1.1 billion, increased the liability representing our off-balance sheet exposure for unfunded commitments by $116 million, and increased our deferred tax asset by $306 million, resulting in a cumulative effect adjustment that reduced retained earnings by $953 million. This transition adjustment was inclusive of qualitative adjustments incorporated into our CECL allowance as necessary, to address any limitations in the models used. The following capital amounts and ratios are based upon the Bank’s average assets and risk-weighted assets, as indicated. Actual U.S. Basel III Minimum Requirements Plus Buffer (1)(2) Amount Ratio Amount Ratio As of March 31, 2021: Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 3,164,962 13.5 % $ 1,637,155 > 7.0 % Tier 1 Capital (to Risk-Weighted Assets) $ 3,164,962 13.5 % $ 1,987,974 > 8.5 % Total Capital (to Risk-Weighted Assets) $ 3,230,743 13.8 % $ 2,455,732 > 10.5 % Tier 1 Capital (to Average Assets) $ 3,164,962 10.0 % $ 1,271,568 > 4.0 % As of December 31, 2020: Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 3,579,005 14.0 % $ 1,794,780 > 7.0 % Tier 1 Capital (to Risk-Weighted Assets) $ 3,579,005 14.0 % $ 2,179,375 > 8.5 % Total Capital (to Risk-Weighted Assets) $ 3,849,820 15.0 % $ 2,692,169 > 10.5 % Tier 1 Capital (to Average Assets) $ 3,579,005 11.3 % $ 1,264,424 > 4.0 % ________________ (1) Reflects the U.S. Basel III minimum required ratio plus the applicable capital conservation buffer. (2) The Bank’s regulatory capital ratios also exceeded all applicable standards for the Bank to qualify as “well capitalized” under the prompt corrective action framework. Bank Dividends |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | Commitments, Contingencies and Guarantees Commitments When we approve a Private Education Loan at the beginning of an academic year, that approval may cover the borrowing for the entire academic year. As such, we do not always disburse the full amount of the loan at the time of such approval, but instead have a commitment to fund a portion of the loan at a later date (usually at the start of the second semester or subsequent trimesters). We estimate expected credit losses over the contractual period that we are exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by us. At March 31, 2021, we had $457 million of outstanding contractual loan commitments which we expect to fund during the remainder of the 2020/2021 academic year. At March 31, 2021, we had a $19 million reserve recorded in “Other Liabilities” to cover lifetime expected credit losses on these unfunded commitments. See Notes to Consolidated Financial Statements, Note 2, “Significant Accounting Policies - Allowance for Credit Losses 2020 — Off-Balance Sheet Exposure for Contractual Loan Commitments” in our 2020 Form 10-K and Note 6, “Unfunded Loan Commitments” in this Form 10-Q for additional information. Regulatory Matters For additional information regarding our regulatory matters, see Notes to Consolidated Financial Statements, Note 20, “Commitments, Contingencies and Guarantees” in our 2020 Form 10-K. Contingencies In the ordinary course of business, we and our subsidiaries are routinely defendants in or parties to pending and threatened legal actions and proceedings, including actions brought on behalf of various classes of claimants. These actions and proceedings may be based on alleged violations of consumer protection, securities, employment and other laws. In certain of these actions and proceedings, claims for substantial monetary damage may be asserted against us and our subsidiaries. It is common for the Company, our subsidiaries and affiliates to receive information and document requests and investigative demands from state attorneys general, legislative committees, and administrative agencies. These requests may be for informational or regulatory purposes and may relate to our business practices, the industries in which we operate, or other companies with whom we conduct business. Our practice has been and continues to be to cooperate with these bodies and be responsive to any such requests. We are required to establish reserves for litigation and regulatory matters where those matters present loss contingencies that are both probable and estimable. When loss contingencies are not both probable and estimable, we do not establish reserves. Based on current knowledge, management does not believe there are loss contingencies, if any, arising from pending investigations, litigation or regulatory matters for which reserves should be established. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited, consolidated financial statements of SLM Corporation (“Sallie Mae,” “SLM,” the “Company,” “we,” or “us”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all the information and footnotes required by GAAP for complete consolidated financial statements. The consolidated financial statements include the accounts of SLM Corporation and its majority-owned and controlled subsidiaries after eliminating the effects of intercompany accounts and transactions. In the opinion of management, all adjustments considered necessary for a fair statement of the results for the interim periods have been included. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Operating results for the three months ended March 31, 2021 are not necessarily indicative of the results for the year ending December 31, 2021 or for any other period. These unaudited financial statements should be read in conjunction with the audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”). |
Consolidation | Consolidation The consolidated financial statements include the accounts of the Company and its majority-owned and controlled subsidiaries after eliminating the effects of intercompany accounts and transactions. |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost and fair value of securities available-for-sale | The amortized cost and fair value of securities available for sale are as follows: March 31, 2021 Amortized Cost Allowance for credit losses (1) Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale: Mortgage-backed securities $ 348,080 $ — $ 3,492 $ (6,545) $ 345,027 Utah Housing Corporation bonds 8,375 — 80 (15) 8,440 U.S. government-sponsored enterprises and Treasuries 1,560,848 — 2,581 (146) 1,563,283 Other securities 198,976 — 769 (610) 199,135 Total $ 2,116,279 $ — $ 6,922 $ (7,316) $ 2,115,885 December 31, 2020 Amortized Cost Allowance for credit losses (1) Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Available-for-sale: Mortgage-backed securities $ 308,913 $ — $ 6,095 $ (134) $ 314,874 Utah Housing Corporation bonds 12,357 — 210 — 12,567 U.S. government-sponsored enterprises 1,596,890 — 3,395 — 1,600,285 Other securities 68,797 — 462 (351) 68,908 Total $ 1,986,957 $ — $ 10,162 $ (485) $ 1,996,634 ___________ |
Available-for-sale securities, continuous unrealized loss position, fair value | The following table summarizes the amount of gross unrealized losses for our available-for-sale securities and the estimated fair value for securities having gross unrealized loss positions, categorized by length of time the securities have been in an unrealized loss position: Less than 12 months 12 months or more Total Gross Estimated Gross Estimated Gross Estimated As of March 31, 2021: Mortgage-backed securities $ (6,545) $ 242,386 $ — $ — $ (6,545) $ 242,386 Utah Housing Corporation bonds (15) 4,357 — — (15) 4,357 U.S. government-sponsored enterprises and Treasuries (146) 114,870 — — (146) 114,870 Other securities (339) 89,603 (271) 12,776 (610) 102,379 Total $ (7,045) $ 451,216 $ (271) $ 12,776 $ (7,316) $ 463,992 As of December 31, 2020: Mortgage-backed securities $ (134) $ 46,011 $ — $ — $ (134) $ 46,011 Utah Housing Corporation bonds — — — — — — U.S. government-sponsored enterprises — — — — — — Other securities (351) 30,441 — — (351) 30,441 Total $ (485) $ 76,452 $ — $ — $ (485) $ 76,452 |
Amortized cost and fair value of securities by contractual maturities | As of March 31, 2021, the amortized cost and fair value of securities, by contractual maturities, are summarized below. Contractual maturities versus actual maturities may differ due to the effect of prepayments. Year of Maturity Amortized Cost Estimated Fair Value 2021 $ 293,759 $ 294,232 2022 1,018,268 1,019,960 2023 148,822 149,166 2024 100,000 99,925 2038 76 88 2039 1,601 1,773 2042 4,201 4,206 2043 7,415 7,711 2044 10,133 10,610 2045 8,870 9,179 2046 14,414 14,797 2047 18,646 18,992 2048 4,362 4,545 2049 36,368 37,683 2050 174,919 170,740 2051 75,449 73,143 2053 134,414 134,289 2054 64,562 64,846 Total $ 2,116,279 $ 2,115,885 |
Loans Held for Investment (Tabl
Loans Held for Investment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Schedule of Loans Held for Investment | Loans held for investment are summarized as follows: March 31, December 31, 2021 2020 Private Education Loans: Fixed-rate $ 9,504,760 $ 8,950,216 Variable-rate 11,237,080 10,779,121 Total Private Education Loans, gross 20,741,840 19,729,337 Deferred origination costs and unamortized premium/(discount) 64,468 63,475 Allowance for credit losses (1,173,375) (1,355,844) Total Private Education Loans, net 19,632,933 18,436,968 FFELP Loans 727,664 737,593 Deferred origination costs and unamortized premium/(discount) 1,954 1,993 Allowance for credit losses (4,318) (4,378) Total FFELP Loans, net 725,300 735,208 Credit Cards (fixed-rate) 11,309 12,238 Deferred origination costs and unamortized premium/(discount) 73 230 Allowance for credit losses (1,328) (1,501) Total Credit Cards, net 10,054 10,967 Loans held for investment, net $ 20,368,287 $ 19,183,143 The average balance and the respective weighted average interest rates of loans in our portfolio are summarized as follows: Three Months Ended March 31, 2021 2020 Average Balance Weighted Average Interest Rate Average Balance Weighted Average Interest Rate Private Education Loans $ 20,984,491 8.22 % $ 23,502,844 8.86 % FFELP Loans 734,289 3.41 776,326 4.29 Personal Loans — — 973,671 12.11 Credit Cards 11,841 0.78 5,286 (4.72) Total portfolio $ 21,730,621 $ 25,258,127 The following table provides the average recorded investment and interest income recognized for our TDR loans. Three Months Ended 2021 2020 Average Interest Average Interest TDR Loans $ 1,288,333 $ 21,489 $ 1,615,764 $ 26,488 |
Allowance for Credit Losses (Ta
Allowance for Credit Losses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Allowance for credit losses and recorded investments in loans | Allowance for Credit Losses Metrics Allowance for Credit Losses Three Months Ended March 31, 2021 FFELP Private Education Credit Cards Total Allowance for Credit Losses Beginning balance $ 4,378 $ 1,355,844 $ 1,501 $ 1,361,723 Transfer from unfunded commitment liability (1) — 126,880 — 126,880 Provisions: Provision for current period 29 (254,942) (86) (254,999) Loan sale reduction to provision — (8,858) — (8,858) Loan transfer from held-for-sale — 1,887 — 1,887 Total provisions (2) 29 (261,913) (86) (261,970) Net charge-offs: Charge-offs (89) (55,139) (88) (55,316) Recoveries — 7,703 1 7,704 Net charge-offs (89) (47,436) (87) (47,612) Loan sales — — — — Ending Balance $ 4,318 $ 1,173,375 $ 1,328 $ 1,179,021 Allowance: Ending balance: individually evaluated for impairment $ — $ 95,536 $ — $ 95,536 Ending balance: collectively evaluated for impairment $ 4,318 $ 1,077,839 $ 1,328 $ 1,083,485 Loans: Ending balance: individually evaluated for impairment $ — $ 1,225,604 $ — $ 1,225,604 Ending balance: collectively evaluated for impairment $ 727,664 $ 19,516,236 $ 11,309 $ 20,255,209 Net charge-offs as a percentage of average loans in repayment (annualized) (3) 0.06 % 1.29 % 2.92 % Allowance as a percentage of the ending total loan balance 0.59 % 5.66 % 11.74 % Allowance as a percentage of the ending loans in repayment (3) 0.80 % 7.94 % 11.74 % Allowance coverage of net charge-offs (annualized) 12.13 6.18 3.82 Ending total loans, gross $ 727,664 $ 20,741,840 $ 11,309 Average loans in repayment (3) $ 554,510 $ 14,743,508 $ 11,909 Ending loans in repayment (3) $ 540,903 $ 14,777,939 $ 11,309 ____________ (1) See Note 6, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively. (2) Below is a reconciliation of the provision for credit losses reported in the consolidated statements of income. When a new loan commitment is made, we record the CECL allowance as a liability for unfunded commitments by recording a provision for credit losses. When the loan is funded, we transfer that liability to the allowance for credit losses. Consolidated Statements of Income Three Months Ended Private Education Loan provisions for credit losses: Provisions for loan losses $ (261,913) Provisions for unfunded loan commitments 36,203 Total Private Education Loan provisions for credit losses (225,710) Other impacts to the provisions for credit losses: FFELP Loans 29 Credit Cards (86) Total (57) Provisions for credit losses reported in consolidated statements of income $ (225,767) (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period. Allowance for Credit Losses Three Months Ended March 31, 2020 FFELP Private Education Personal Credit Cards Total Allowance for Credit Losses Beginning balance $ 1,633 $ 374,300 $ 65,877 $ 102 $ 441,912 Day 1 adjustment for the adoption of CECL 2,852 1,060,830 79,183 188 1,143,053 Balance at January 1, 2020 4,485 1,435,130 145,060 290 1,584,965 Transfer from unfunded commitment liability (1) — 142,075 — — 142,075 Provisions: Provision for current period 37 143,862 25,318 291 169,508 Loan sale reduction to provision — (161,793) — — (161,793) Total provisions (2) 37 (17,931) 25,318 291 7,715 Net charge-offs: Charge-offs (226) (51,469) (19,247) (7) (70,949) Recoveries — 7,976 1,542 — 9,518 Net charge-offs (226) (43,493) (17,705) (7) (61,431) Ending Balance $ 4,296 $ 1,515,781 $ 152,673 $ 574 $ 1,673,324 Allowance: Ending balance: individually evaluated for impairment $ — $ 150,822 $ — $ — $ 150,822 Ending balance: collectively evaluated for impairment $ 4,296 $ 1,364,959 $ 152,673 $ 574 $ 1,522,502 Loans: Ending balance: individually evaluated for impairment $ — $ 1,518,763 $ — $ — $ 1,518,763 Ending balance: collectively evaluated for impairment $ 766,954 $ 20,107,984 $ 899,704 $ 7,234 $ 21,781,876 Net charge-offs as a percentage of average loans in repayment (annualized) (3) 0.15 % 1.05 % 7.27 % 0.52 % Allowance as a percentage of the ending total loan balance 0.56 % 7.01 % 16.97 % 7.93 % Allowance as a percentage of the ending loans in repayment (3) 0.74 % 10.11 % 16.97 % 7.93 % Allowance coverage of net charge-offs (annualized) 4.75 8.71 2.16 20.50 Ending total loans, gross $ 766,954 $ 21,626,747 $ 899,704 $ 7,234 Average loans in repayment (3) $ 600,534 $ 16,521,356 $ 973,772 $ 5,364 Ending loans in repayment (3) $ 581,997 $ 14,988,345 $ 899,704 $ 7,234 ____________ (1) See Note 6, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively. (2) Below is a reconciliation of the provisions for credit losses reported in the consolidated statements of income. When a new loan commitment is made, we record the CECL allowance as a liability for unfunded loan commitments by recording a provision for credit losses. When the loan is funded, we transfer that liability to the allowance for credit losses. Consolidated Statements of Income Three Months Ended Private Education Loan provisions for credit losses: Provisions for loan losses $ (17,931) Provisions for unfunded loan commitments 53,543 Total Private Education Loan provisions for credit losses 35,612 Other impacts to the provisions for credit losses: Personal Loans 25,318 FFELP Loans 37 Credit Cards 291 Total 25,646 Provisions for credit losses reported in consolidated statements of income $ 61,258 (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period. Three Months Ended March 31, 2021 2020 Allowance Unfunded Commitments Allowance Unfunded Commitments Beginning Balance $ 110,044 $ 1,673,018 $ 2,481 $ 1,910,603 Day 1 adjustment for the adoption of CECL — — 115,758 — Balance at January 1 110,044 1,673,018 118,239 1,910,603 Provision/New commitments - net (1) 40,197 843,161 49,561 834,946 Other provision items (3,994) — 3,982 — Transfer - funded loans (2) (126,880) (2,058,726) (142,075) (2,295,742) Ending Balance $ 19,367 $ 457,453 $ 29,707 $ 449,807 ________________ (1) Net of expirations of commitments unused. (2) When a loan commitment is funded, its related liability for credit losses (which originally was recorded as a provision for unfunded commitments) is transferred to the allowance for credit losses. |
Impaired financing receivables | The following table provides the recorded investment, unpaid principal balance and related allowance for our TDR loans. Recorded Investment Unpaid Principal Balance Allowance March 31, 2021 TDR Loans $ 1,263,651 $ 1,225,604 $ 95,536 December 31, 2020 TDR Loans $ 1,312,805 $ 1,274,590 $ 104,265 |
Average recorded investment and interest income recognized for troubled debt restructuring loans | Loans held for investment are summarized as follows: March 31, December 31, 2021 2020 Private Education Loans: Fixed-rate $ 9,504,760 $ 8,950,216 Variable-rate 11,237,080 10,779,121 Total Private Education Loans, gross 20,741,840 19,729,337 Deferred origination costs and unamortized premium/(discount) 64,468 63,475 Allowance for credit losses (1,173,375) (1,355,844) Total Private Education Loans, net 19,632,933 18,436,968 FFELP Loans 727,664 737,593 Deferred origination costs and unamortized premium/(discount) 1,954 1,993 Allowance for credit losses (4,318) (4,378) Total FFELP Loans, net 725,300 735,208 Credit Cards (fixed-rate) 11,309 12,238 Deferred origination costs and unamortized premium/(discount) 73 230 Allowance for credit losses (1,328) (1,501) Total Credit Cards, net 10,054 10,967 Loans held for investment, net $ 20,368,287 $ 19,183,143 The average balance and the respective weighted average interest rates of loans in our portfolio are summarized as follows: Three Months Ended March 31, 2021 2020 Average Balance Weighted Average Interest Rate Average Balance Weighted Average Interest Rate Private Education Loans $ 20,984,491 8.22 % $ 23,502,844 8.86 % FFELP Loans 734,289 3.41 776,326 4.29 Personal Loans — — 973,671 12.11 Credit Cards 11,841 0.78 5,286 (4.72) Total portfolio $ 21,730,621 $ 25,258,127 The following table provides the average recorded investment and interest income recognized for our TDR loans. Three Months Ended 2021 2020 Average Interest Average Interest TDR Loans $ 1,288,333 $ 21,489 $ 1,615,764 $ 26,488 |
Age analysis of past due loans delinquencies | The following table provides information regarding the loan status and aging of TDR loans. For the periods presented below, we updated our delinquency bucket periods to conform with the delinquency bucket periods defined by the Federal Financial Institutions Examination Council (“FFIEC”). March 31, December 31, 2021 2020 Balance % Balance % TDR loans in in-school/grace/deferment (1) $ 93,850 $ 88,750 TDR loans in forbearance (2) 68,609 76,704 TDR loans in repayment (3) and percentage of each status: Loans current 966,201 90.9 % 971,880 87.7 % Loans delinquent 30-59 days (4) 39,541 3.7 59,249 5.3 Loans delinquent 60-89 days (4) 29,892 2.8 43,576 3.9 Loans 90 days or greater past due (4) 27,511 2.6 34,431 3.1 Total TDR loans in repayment (3) 1,063,145 100.0 % 1,109,136 100.0 % Total TDR loans, gross $ 1,225,604 $ 1,274,590 _____ (1) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation). (2) Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period (but, for purposes of the table, do not include those loans while they are in forbearance). (4) The period of delinquency is based on the number of days scheduled payments are contractually past due. The following tables provide information regarding the loan status of our Private Education Loans, held for investment, by year of origination. Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period (but, for purposes of the following tables, do not include those loans while they are in forbearance). For the periods presented below, we updated our delinquency bucket periods to conform with the delinquency bucket periods defined by the FFIEC. Private Education Loans Held for Investment Delinquencies by Origination Vintage March 31, 2021 2021 2020 2019 2018 2017 2016 and Prior Total Loans in-school/grace/deferment (1)(2) $ 330,417 $ 1,798,922 $ 1,255,241 $ 703,917 $ 489,599 $ 815,578 $ 5,393,674 Loans in forbearance (1)(3) 1,186 21,471 89,409 93,513 103,807 260,841 570,227 Loans in repayment (1) : Loans current 418,103 2,747,747 2,491,380 1,955,468 1,755,863 5,102,866 14,471,427 Loans delinquent 30-59 days (4) 366 6,587 14,015 19,145 24,043 88,587 152,743 Loans delinquent 60-89 days (4) — 1,747 7,654 11,064 13,166 52,759 86,390 Loans 90 days or greater past due (4) — 943 4,578 8,247 10,921 42,690 67,379 Total Private Education Loans in repayment 418,469 2,757,024 2,517,627 1,993,924 1,803,993 5,286,902 14,777,939 Total Private Education Loans, gross 750,072 4,577,417 3,862,277 2,791,354 2,397,399 6,363,321 20,741,840 Private Education Loans deferred origination costs and unamortized premium/(discount) 5,487 19,922 12,925 7,977 6,153 12,004 64,468 Total Private Education Loans 755,559 4,597,339 3,875,202 2,799,331 2,403,552 6,375,325 20,806,308 Private Education Loans allowance for losses (35,515) (252,247) (239,917) (169,296) (140,894) (335,506) (1,173,375) Private Education Loans, net $ 720,044 $ 4,345,092 $ 3,635,285 $ 2,630,035 $ 2,262,658 $ 6,039,819 $ 19,632,933 Percentage of Private Education Loans in repayment 55.8 % 60.2 % 65.2 % 71.4 % 75.2 % 83.1 % 71.2 % Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment 0.1 % 0.3 % 1.0 % 1.9 % 2.7 % 3.5 % 2.1 % Loans in forbearance as a percentage of loans in repayment and forbearance 0.3 % 0.8 % 3.4 % 4.5 % 5.4 % 4.7 % 3.7 % _______ (1) For some students, going back to school in the fall was not an option because of the pandemic, or for other reasons. Therefore, some students are taking a “gap year” before returning to school. In 2020, for those students that had unexpectedly separated from school, we provided an extension of time through fall 2021 to re-enroll, before beginning their grace period that occurs prior to entering full principal and interest repayment status. At March 31, 2021, the loans in the “in-school/grace/deferment” category above include $273 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At March 31, 2021, the loans in the “in forbearance” category above include $29 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At March 31, 2021, the loans in the “in repayment” category above include $482 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. (2) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation). (3) Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. (4) The period of delinquency is based on the number of days scheduled payments are contractually past due. Private Education Loans Held for Investment Delinquencies by Origination Vintage December 31, 2020 2020 2019 2018 2017 2016 2015 and Prior Total Loans in-school/grace/deferment (1)(2) $ 1,374,085 $ 1,330,175 $ 733,824 $ 508,478 $ 327,763 $ 504,715 $ 4,779,040 Loans in forbearance (1)(3) 16,159 92,677 110,319 118,946 109,073 198,302 645,476 Loans in repayment (1) : Loans current 2,043,033 2,573,228 2,045,012 1,850,539 1,685,572 3,701,564 13,898,948 Loans delinquent 30-59 days (4) 6,400 16,983 26,934 30,771 33,040 91,400 205,528 Loans delinquent 60-89 days (4) 2,628 9,143 15,026 18,121 19,064 55,661 119,643 Loans 90 days or greater past due (4) 460 4,642 9,396 12,939 14,710 38,555 80,702 Total Private Education Loans in repayment 2,052,521 2,603,996 2,096,368 1,912,370 1,752,386 3,887,180 14,304,821 Total Private Education Loans, gross 3,442,765 4,026,848 2,940,511 2,539,794 2,189,222 4,590,197 19,729,337 Private Education Loans deferred origination costs and unamortized premium/(discount) 21,129 13,933 8,671 6,708 5,721 7,313 63,475 Total Private Education Loans 3,463,894 4,040,781 2,949,182 2,546,502 2,194,943 4,597,510 19,792,812 Private Education Loans allowance for losses (210,875) (298,776) (218,136) (184,265) (150,150) (293,642) (1,355,844) Private Education Loans, net $ 3,253,019 $ 3,742,005 $ 2,731,046 $ 2,362,237 $ 2,044,793 $ 4,303,868 $ 18,436,968 Percentage of Private Education Loans in repayment 59.6 % 64.7 % 71.3 % 75.3 % 80.0 % 84.7 % 72.5 % Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment 0.5 % 1.2 % 2.4 % 3.2 % 3.8 % 4.8 % 2.8 % Loans in forbearance as a percentage of loans in repayment and forbearance 0.8 % 3.4 % 5.0 % 5.9 % 5.9 % 4.9 % 4.3 % _______ (1) For some students, going back to school in the fall was not an option because of the pandemic, or for other reasons. Therefore, some students are taking a “gap year” before returning to school. In 2020, for those students that had unexpectedly separated from school, we provided an extension of time through fall 2021 to re-enroll, before beginning their grace period that occurs prior to entering full principal and interest repayment status. At December 31, 2020, the loans in the “in-school/grace/deferment” category above include $401 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At December 31, 2020, the loans in the “in forbearance” category above include $30 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. At December 31, 2020, the loans in the “in repayment” category above include $609 million of Private Education Loans whose borrowers did not return to school in the fall of 2020 and who received such extension of time from us to re-enroll before beginning their grace period. (2) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation). (3) Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures. (4) The period of delinquency is based on the number of days scheduled payments are contractually past due. |
Modified loans accounts for troubled debt restructuring | The following table provides the amount of modified loans (which include forbearance and reductions in interest rates) that became TDRs in the periods presented. Additionally, for the periods presented, the table summarizes charge-offs occurring in the TDR portfolio, as well as TDRs for which a payment default occurred in the relevant period presented and within 12 months of the loan first being designated as a TDR. We define payment default as 60 days past due for this disclosure. Three Months Ended Three Months Ended Modified Loans (1) Charge-offs Payment- Modified Loans (1) Charge-offs Payment- TDR Loans $ 3,717 $ 17,948 $ 4,869 $ 132,815 $ 19,375 $ 30,725 _____ |
Private education loan portfolio stratified by key credit quality indicators | The following tables highlight the gross principal balance of our Private Education Loan portfolio, by year of origination, stratified by key credit quality indicators. Private Education Loans Held for Investment - Credit Quality Indicators March 31, 2021 Year of Origination 2021 (1) 2020 (1) 2019 (1) 2018 (1) 2017 (1) 2016 and Prior (1) Total (1) % of Balance Cosigners: With cosigner $ 640,909 $ 3,954,261 $ 3,331,066 $ 2,431,585 $ 2,137,418 $ 5,799,561 $ 18,294,800 88 % Without cosigner 109,163 623,156 531,211 359,769 259,981 563,760 2,447,040 12 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % FICO at Origination (2) : Less than 670 $ 46,437 $ 253,657 $ 283,992 $ 217,921 $ 189,704 $ 505,347 $ 1,497,058 7 % 670-699 103,191 607,789 576,077 423,618 388,607 1,061,435 3,160,717 15 700-749 243,607 1,472,919 1,260,902 921,338 799,597 2,138,263 6,836,626 33 Greater than or equal to 750 356,837 2,243,052 1,741,306 1,228,477 1,019,491 2,658,276 9,247,439 45 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % FICO Refreshed (2)(3) : Less than 670 $ 64,349 $ 313,569 $ 325,235 $ 290,041 $ 283,988 $ 952,223 $ 2,229,405 11 % 670-699 107,242 573,430 473,331 322,446 271,224 707,135 2,454,808 12 700-749 241,091 1,442,851 1,186,242 813,884 684,467 1,715,802 6,084,337 29 Greater than or equal to 750 337,390 2,247,567 1,877,469 1,364,983 1,157,720 2,988,161 9,973,290 48 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % Seasoning (4) : 1-12 payments $ 419,655 $ 2,510,639 $ 426,229 $ 396,679 $ 392,391 $ 718,899 $ 4,864,492 24 % 13-24 payments — 267,856 2,034,191 254,139 221,863 599,435 3,377,484 16 25-36 payments — — 146,616 1,343,321 250,078 581,741 2,321,756 11 37-48 payments — — — 93,298 978,808 618,454 1,690,560 8 More than 48 payments — — — — 64,660 3,029,214 3,093,874 15 Not yet in repayment 330,417 1,798,922 1,255,241 703,917 489,599 815,578 5,393,674 26 Total $ 750,072 $ 4,577,417 $ 3,862,277 $ 2,791,354 $ 2,397,399 $ 6,363,321 $ 20,741,840 100 % 2021 Current period (5) gross charge-offs $ (6) $ (911) $ (4,483) $ (8,116) $ (8,793) $ (32,830) $ (55,139) 2021 Current period (5) recoveries — 43 452 1,009 1,133 5,066 7,703 2021 Current period (5) net charge-offs $ (6) $ (868) $ (4,031) $ (7,107) $ (7,660) $ (27,764) $ (47,436) Total accrued interest by origination vintage $ 8,317 $ 147,329 $ 291,579 $ 258,813 $ 206,734 $ 335,703 $ 1,248,475 ______ (1) Balance represents gross Private Education Loans. (2) Represents the higher credit score of the cosigner or the borrower. (3) Represents the FICO score updated as of the first-quarter 2021. (4) Number of months in active repayment (whether interest only payment, fixed payment, or full principal and interest payment status) for which a scheduled payment was due. (5) Current period refers to period from January 1, 2021 through March 31, 2021. Private Education Loans Held for Investment Credit Quality Indicators December 31, 2020 Year of Origination 2020 (1) 2019 (1) 2018 (1) 2017 (1) 2016 (1) 2015 and Prior (1) Total (1) % of Balance Cosigners: With cosigner $ 2,915,328 $ 3,467,219 $ 2,556,400 $ 2,262,635 $ 1,977,952 $ 4,198,748 $ 17,378,282 88 % Without cosigner 527,437 559,629 384,111 277,159 211,270 391,449 2,351,055 12 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % FICO at Origination (2) : Less than 670 $ 195,214 $ 290,711 $ 225,276 $ 197,948 $ 162,413 $ 369,609 $ 1,441,171 7 % 670-699 464,785 594,950 441,357 407,394 351,303 771,477 3,031,266 16 700-749 1,111,373 1,310,390 967,802 846,983 740,028 1,533,517 6,510,093 33 Greater than or equal to 750 1,671,393 1,830,797 1,306,076 1,087,469 935,478 1,915,594 8,746,807 44 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % FICO Refreshed (2)(3) : Less than 670 $ 240,154 $ 331,229 $ 301,784 $ 298,195 $ 293,077 $ 734,599 $ 2,199,038 11 % 670-699 438,665 493,135 336,966 283,906 231,759 504,779 2,289,210 12 700-749 1,102,666 1,248,806 871,677 734,222 603,160 1,220,468 5,780,999 29 Greater than or equal to 750 1,661,280 1,953,678 1,430,084 1,223,471 1,061,226 2,130,351 9,460,090 48 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % Seasoning (4) : 1-12 payments $ 2,068,517 $ 600,038 $ 469,143 $ 472,258 $ 381,197 $ 507,343 $ 4,498,496 23 % 13-24 payments 163 2,096,635 383,977 223,332 217,379 425,345 3,346,831 17 25-36 payments — — 1,353,567 370,250 181,940 439,337 2,345,094 12 37-48 payments — — — 965,476 351,433 402,552 1,719,461 9 More than 48 payments — — — — 729,510 2,310,905 3,040,415 15 Not yet in repayment 1,374,085 1,330,175 733,824 508,478 327,763 504,715 4,779,040 24 Total $ 3,442,765 $ 4,026,848 $ 2,940,511 $ 2,539,794 $ 2,189,222 $ 4,590,197 $ 19,729,337 100 % 2020 gross charge-offs (5) $ (1,087) $ (10,940) $ (27,000) $ (35,851) $ (36,416) $ (94,032) $ (205,326) 2020 recoveries (5) 42 636 2,274 3,585 4,284 13,200 24,021 2020 net charge-offs (5) $ (1,045) $ (10,304) $ (24,726) $ (32,266) $ (32,132) $ (80,832) $ (181,305) Total accrued interest by origination vintage $ 90,438 $ 265,688 $ 252,251 $ 209,178 $ 141,094 $ 210,247 $ 1,168,896 ______ (1) Balance represents gross Private Education Loans. (2) Represents the higher credit score of the cosigner or the borrower. (3) Represents the FICO score updated as of the fourth-quarter 2020. (4) Number of months in active repayment (whether interest only payment, fixed payment, or full principal and interest payment status) for which a scheduled payment was due. |
Accrued interest receivable | The following table provides information regarding accrued interest receivable on our Private Education Loans. The table also discloses the amount of accrued interest on loans greater than 90 days past due as compared to our allowance for uncollectible interest on loans making full interest payments. The majority of the total accrued interest receivable represents accrued interest on deferred loans where no payments are due while the borrower is in school and fixed-pay loans where the borrower makes a $25 monthly payment that is smaller than the interest accruing on the loan in that month. The accrued interest on these loans will be capitalized to the balance of the loans when the borrower exits the grace period after separation from school. The allowance for this portion of interest is included in our loan loss reserve. The allowance for uncollectible interest exceeds the amount of accrued interest on our 90 days past due Private Education Loan portfolio for all periods presented. Private Education Loans Accrued Interest Receivable Total Interest Receivable 90 Days and Greater Past Due Allowance for Uncollectible Interest March 31, 2021 $ 1,248,475 $ 3,695 $ 4,405 December 31, 2020 $ 1,168,895 $ 4,354 $ 4,467 |
Unfunded Loan Commitments (Tabl
Unfunded Loan Commitments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Credit Loss [Abstract] | |
Allowance for credit losses and recorded investments in loans | Allowance for Credit Losses Metrics Allowance for Credit Losses Three Months Ended March 31, 2021 FFELP Private Education Credit Cards Total Allowance for Credit Losses Beginning balance $ 4,378 $ 1,355,844 $ 1,501 $ 1,361,723 Transfer from unfunded commitment liability (1) — 126,880 — 126,880 Provisions: Provision for current period 29 (254,942) (86) (254,999) Loan sale reduction to provision — (8,858) — (8,858) Loan transfer from held-for-sale — 1,887 — 1,887 Total provisions (2) 29 (261,913) (86) (261,970) Net charge-offs: Charge-offs (89) (55,139) (88) (55,316) Recoveries — 7,703 1 7,704 Net charge-offs (89) (47,436) (87) (47,612) Loan sales — — — — Ending Balance $ 4,318 $ 1,173,375 $ 1,328 $ 1,179,021 Allowance: Ending balance: individually evaluated for impairment $ — $ 95,536 $ — $ 95,536 Ending balance: collectively evaluated for impairment $ 4,318 $ 1,077,839 $ 1,328 $ 1,083,485 Loans: Ending balance: individually evaluated for impairment $ — $ 1,225,604 $ — $ 1,225,604 Ending balance: collectively evaluated for impairment $ 727,664 $ 19,516,236 $ 11,309 $ 20,255,209 Net charge-offs as a percentage of average loans in repayment (annualized) (3) 0.06 % 1.29 % 2.92 % Allowance as a percentage of the ending total loan balance 0.59 % 5.66 % 11.74 % Allowance as a percentage of the ending loans in repayment (3) 0.80 % 7.94 % 11.74 % Allowance coverage of net charge-offs (annualized) 12.13 6.18 3.82 Ending total loans, gross $ 727,664 $ 20,741,840 $ 11,309 Average loans in repayment (3) $ 554,510 $ 14,743,508 $ 11,909 Ending loans in repayment (3) $ 540,903 $ 14,777,939 $ 11,309 ____________ (1) See Note 6, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively. (2) Below is a reconciliation of the provision for credit losses reported in the consolidated statements of income. When a new loan commitment is made, we record the CECL allowance as a liability for unfunded commitments by recording a provision for credit losses. When the loan is funded, we transfer that liability to the allowance for credit losses. Consolidated Statements of Income Three Months Ended Private Education Loan provisions for credit losses: Provisions for loan losses $ (261,913) Provisions for unfunded loan commitments 36,203 Total Private Education Loan provisions for credit losses (225,710) Other impacts to the provisions for credit losses: FFELP Loans 29 Credit Cards (86) Total (57) Provisions for credit losses reported in consolidated statements of income $ (225,767) (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period. Allowance for Credit Losses Three Months Ended March 31, 2020 FFELP Private Education Personal Credit Cards Total Allowance for Credit Losses Beginning balance $ 1,633 $ 374,300 $ 65,877 $ 102 $ 441,912 Day 1 adjustment for the adoption of CECL 2,852 1,060,830 79,183 188 1,143,053 Balance at January 1, 2020 4,485 1,435,130 145,060 290 1,584,965 Transfer from unfunded commitment liability (1) — 142,075 — — 142,075 Provisions: Provision for current period 37 143,862 25,318 291 169,508 Loan sale reduction to provision — (161,793) — — (161,793) Total provisions (2) 37 (17,931) 25,318 291 7,715 Net charge-offs: Charge-offs (226) (51,469) (19,247) (7) (70,949) Recoveries — 7,976 1,542 — 9,518 Net charge-offs (226) (43,493) (17,705) (7) (61,431) Ending Balance $ 4,296 $ 1,515,781 $ 152,673 $ 574 $ 1,673,324 Allowance: Ending balance: individually evaluated for impairment $ — $ 150,822 $ — $ — $ 150,822 Ending balance: collectively evaluated for impairment $ 4,296 $ 1,364,959 $ 152,673 $ 574 $ 1,522,502 Loans: Ending balance: individually evaluated for impairment $ — $ 1,518,763 $ — $ — $ 1,518,763 Ending balance: collectively evaluated for impairment $ 766,954 $ 20,107,984 $ 899,704 $ 7,234 $ 21,781,876 Net charge-offs as a percentage of average loans in repayment (annualized) (3) 0.15 % 1.05 % 7.27 % 0.52 % Allowance as a percentage of the ending total loan balance 0.56 % 7.01 % 16.97 % 7.93 % Allowance as a percentage of the ending loans in repayment (3) 0.74 % 10.11 % 16.97 % 7.93 % Allowance coverage of net charge-offs (annualized) 4.75 8.71 2.16 20.50 Ending total loans, gross $ 766,954 $ 21,626,747 $ 899,704 $ 7,234 Average loans in repayment (3) $ 600,534 $ 16,521,356 $ 973,772 $ 5,364 Ending loans in repayment (3) $ 581,997 $ 14,988,345 $ 899,704 $ 7,234 ____________ (1) See Note 6, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively. (2) Below is a reconciliation of the provisions for credit losses reported in the consolidated statements of income. When a new loan commitment is made, we record the CECL allowance as a liability for unfunded loan commitments by recording a provision for credit losses. When the loan is funded, we transfer that liability to the allowance for credit losses. Consolidated Statements of Income Three Months Ended Private Education Loan provisions for credit losses: Provisions for loan losses $ (17,931) Provisions for unfunded loan commitments 53,543 Total Private Education Loan provisions for credit losses 35,612 Other impacts to the provisions for credit losses: Personal Loans 25,318 FFELP Loans 37 Credit Cards 291 Total 25,646 Provisions for credit losses reported in consolidated statements of income $ 61,258 (3) Loans in repayment include loans on which borrowers are making interest only or fixed payments, as well as loans that have entered full principal and interest repayment status after any applicable grace period. Three Months Ended March 31, 2021 2020 Allowance Unfunded Commitments Allowance Unfunded Commitments Beginning Balance $ 110,044 $ 1,673,018 $ 2,481 $ 1,910,603 Day 1 adjustment for the adoption of CECL — — 115,758 — Balance at January 1 110,044 1,673,018 118,239 1,910,603 Provision/New commitments - net (1) 40,197 843,161 49,561 834,946 Other provision items (3,994) — 3,982 — Transfer - funded loans (2) (126,880) (2,058,726) (142,075) (2,295,742) Ending Balance $ 19,367 $ 457,453 $ 29,707 $ 449,807 ________________ (1) Net of expirations of commitments unused. (2) When a loan commitment is funded, its related liability for credit losses (which originally was recorded as a provision for unfunded commitments) is transferred to the allowance for credit losses. |
Deposits (Tables)
Deposits (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Banking and Thrift, Other Disclosures [Abstract] | |
Schedule of deposits | The following table summarizes total deposits at March 31, 2021 and December 31, 2020. March 31, December 31, 2021 2020 Deposits - interest bearing $ 22,801,323 $ 22,664,899 Deposits - non-interest bearing 1,820 1,140 Total deposits $ 22,803,143 $ 22,666,039 |
Interest bearing deposits | Interest bearing deposits at March 31, 2021 and December 31, 2020 are summarized as follows: March 31, 2021 December 31, 2020 Amount Qtr.-End Weighted Average Stated Rate (1) Amount Year-End Weighted Average Stated Rate (1) Money market $ 10,951,595 0.68 % $ 10,159,657 0.83 % Savings 955,547 0.42 907,976 0.55 Certificates of deposit 10,894,181 1.24 11,597,266 1.34 Deposits - interest bearing $ 22,801,323 $ 22,664,899 ____________ (1) Includes the effect of interest rate swaps in effective hedge relationships. |
Borrowings (Tables)
Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of debt | The following table summarizes our borrowings at March 31, 2021 and December 31, 2020. March 31, 2021 December 31, 2020 Short-Term Long-Term Total Short-Term Long-Term Total Unsecured borrowings: Unsecured debt (fixed-rate) $ — $ 693,099 $ 693,099 $ — $ 692,879 $ 692,879 Total unsecured borrowings — 693,099 693,099 — 692,879 692,879 Secured borrowings: Private Education Loan term securitizations: Fixed-rate — 3,109,329 3,109,329 — 3,261,233 3,261,233 Variable-rate — 1,116,242 1,116,242 — 1,235,105 1,235,105 Total Private Education Loan term securitizations — 4,225,571 4,225,571 — 4,496,338 4,496,338 Secured Borrowing Facility — — — — — — Total secured borrowings — 4,225,571 4,225,571 — 4,496,338 4,496,338 Total $ — $ 4,918,670 $ 4,918,670 $ — $ 5,189,217 $ 5,189,217 |
Schedule of securities financing transactions | Secured Financings at Issuance The following summarizes our secured financings issued in 2020 and in 2021 through March 31, 2021: Issue Date Issued Total Issued Weighted Average Cost of Funds (1) Weighted Average Life Private Education: 2020-A February 2020 $ 636,000 1-month LIBOR plus 0.88% 4.18 2020-B August 2020 707,000 1-month LIBOR plus 1.30% 4.14 Total notes issued in 2020 $ 1,343,000 Total loan and accrued interest amount securitized at inception in 2020 (2) $ 1,463,230 ____________ (1) Represents LIBOR equivalent cost of funds for floating and fixed-rate bonds, excluding issuance costs. |
Schedule of variable interest entities | March 31, 2021 Debt Outstanding Carrying Amount of Assets Securing Debt Outstanding Short-Term Long-Term Total Loans Restricted Cash Other Assets (1) Total Secured borrowings: Private Education Loan term securitizations $ — $ 4,225,571 $ 4,225,571 $ 5,343,243 $ 164,708 $ 355,949 $ 5,863,900 Secured Borrowing Facility — — — — — 2,496 2,496 Total $ — $ 4,225,571 $ 4,225,571 $ 5,343,243 $ 164,708 $ 358,445 $ 5,866,396 ____ (1) Other assets primarily represent accrued interest receivable. December 31, 2020 Debt Outstanding Carrying Amount of Assets Securing Debt Outstanding Short-Term Long-Term Total Loans Restricted Cash Other Assets (1) Total Secured borrowings: Private Education Loan term securitizations $ — $ 4,496,338 $ 4,496,338 $ 5,661,123 $ 154,417 $ 356,967 $ 6,172,507 Secured Borrowing Facility — — — — — 436 436 Total $ — $ 4,496,338 $ 4,496,338 $ 5,661,123 $ 154,417 $ 357,403 $ 6,172,943 ____ (1) Other assets primarily represent accrued interest receivable. The table below provides a summary of our exposure related to our unconsolidated VIEs. March 31, 2021 December 31, 2020 Debt Interests (1) Equity Interests (2) Total Exposure Debt Interests (1) Equity Interests (2) Total Exposure Private Education Loan term securitizations $ 199,135 $ 30,594 $ 229,729 $ 68,908 $ 16,923 $ 85,831 ____ (1) Vertical risk retention interest classified as available-for-sale investment. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Impact of derivatives on the consolidated balance sheet | The following tables summarize the fair values and notional amounts of all derivative instruments at March 31, 2021 and December 31, 2020, and their impact on earnings and other comprehensive income for the three months ended March 31, 2021 and March 31, 2020. Please refer to Notes to Consolidated Financial Statements, Note 12, “Derivative Financial Instruments” in our 2020 Form 10-K for a full discussion of cash flow hedges, fair value hedges, and trading activities. Impact of Derivatives on the Consolidated Balance Sheets Cash Flow Hedges Fair Value Hedges Trading Total March 31, December March 31, December March 31, December March 31, December 2021 2020 2021 2020 2021 2020 2021 2020 Fair Values (1) Hedged Risk Exposure Derivative Assets: (2) Interest rate swaps Interest rate $ 809 $ — $ 245 $ 594 $ — $ 135 $ 1,054 $ 729 Derivative Liabilities: (2) Interest rate swaps Interest rate — (287) — — (451) — (451) (287) Total net derivatives $ 809 $ (287) $ 245 $ 594 $ (451) $ 135 $ 603 $ 442 ___________ (1) Fair values reported include variation margin as legal settlement of the derivative contract. Assets and liabilities are presented without consideration of master netting agreements. Derivatives are carried on the balance sheet based on net position by counterparty under master netting agreements and classified in other assets or other liabilities depending on whether in a net positive or negative position. (2) The following table reconciles gross positions with the impact of master netting agreements to the balance sheet classification: Other Assets Other Liabilities March 31, December 31, March 31, December 31, 2021 2020 2021 2020 Gross position (1) $ 1,054 $ 729 $ (451) $ (287) Impact of master netting agreement (451) (176) 451 176 Derivative values with impact of master netting agreements (as carried on balance sheet) 603 553 — (111) Cash collateral pledged (2) 23,592 42,874 — — Net position $ 24,195 $ 43,427 $ — $ (111) __________ (1) Gross position amounts include accrued interest and variation margin as legal settlement of the derivative contract. |
Offsetting assets | The following table reconciles gross positions with the impact of master netting agreements to the balance sheet classification: Other Assets Other Liabilities March 31, December 31, March 31, December 31, 2021 2020 2021 2020 Gross position (1) $ 1,054 $ 729 $ (451) $ (287) Impact of master netting agreement (451) (176) 451 176 Derivative values with impact of master netting agreements (as carried on balance sheet) 603 553 — (111) Cash collateral pledged (2) 23,592 42,874 — — Net position $ 24,195 $ 43,427 $ — $ (111) __________ (1) Gross position amounts include accrued interest and variation margin as legal settlement of the derivative contract. |
Offsetting liabilities | The following table reconciles gross positions with the impact of master netting agreements to the balance sheet classification: Other Assets Other Liabilities March 31, December 31, March 31, December 31, 2021 2020 2021 2020 Gross position (1) $ 1,054 $ 729 $ (451) $ (287) Impact of master netting agreement (451) (176) 451 176 Derivative values with impact of master netting agreements (as carried on balance sheet) 603 553 — (111) Cash collateral pledged (2) 23,592 42,874 — — Net position $ 24,195 $ 43,427 $ — $ (111) __________ (1) Gross position amounts include accrued interest and variation margin as legal settlement of the derivative contract. |
Schedule of notional amounts of outstanding derivative positions | Cash Flow Fair Value Trading Total March 31, December 31, March 31, December 31, March 31, December 31, March 31, December 31, 2021 2020 2021 2020 2021 2020 2021 2020 Notional Values Interest rate swaps $ 1,535,718 $ 1,018,976 $ 4,637,654 $ 4,845,543 $ 2,393,364 $ 2,693,364 $ 8,566,736 $ 8,557,883 |
Schedule of cumulative basis adjustments for fair value hedges | As of March 31, 2021 and December 31, 2020, the following amounts were recorded on the consolidated balance sheet related to cumulative basis adjustments for fair value hedges: Line Item in the Balance Sheet in Which the Hedged Item is Included: Carrying Amount of the Hedged Assets/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) March 31, December 31, March 31, December 31, 2021 2020 2021 2020 Deposits $ (4,754,979) $ (4,992,867) $ (122,959) $ (154,235) |
Derivative instruments, gain (loss) | Impact of Derivatives on the Consolidated Statements of Income Three Months Ended 2021 2020 Fair Value Hedges Interest rate swaps: Interest recognized on derivatives $ 22,610 $ 4,623 Hedged items recorded in interest expense 31,275 (143,248) Derivatives recorded in interest expense (31,251) 144,183 Total $ 22,634 $ 5,558 Cash Flow Hedges Interest rate swaps: Amount of gain (loss) reclassified from accumulated other comprehensive income into interest expense $ (5,269) $ (1,528) Total $ (5,269) $ (1,528) Trading Interest rate swaps: Change in fair value of future interest payments recorded in earnings $ (10,864) $ 42,312 Total (10,864) 42,312 Total $ 6,501 $ 46,342 |
Schedule of derivative instruments, effect on other comprehensive income (loss) | Impact of Derivatives on the Statements of Changes in Stockholders’ Equity Three Months Ended March 31, 2021 2020 Amount of gain (loss) recognized in other comprehensive income (loss) $ 18,154 $ (47,222) Less: amount of gain (loss) reclassified in interest expense (5,269) (1,528) Total change in other comprehensive income (loss) for unrealized gains (losses) on derivatives, before income tax (expense) benefit $ 23,423 $ (45,694) |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of common share repurchases | The following table summarizes our common share repurchases and issuances. Three Months Ended (Shares and per share amounts in actuals) 2021 2020 Common stock repurchased under repurchase programs (1)(2)(3) 48,702,830 47,736,847 Average purchase price per share (4) $ 15.75 $ 9.66 Shares repurchased related to employee stock-based compensation plans (5) 1,059,980 1,105,119 Average purchase price per share $ 13.50 $ 10.98 Common shares issued (6) 2,826,387 2,837,562 __________________ (1) Common shares purchased under our share repurchase programs. We have utilized all capacity under our 2020 Share Repurchase Program. There was $734 million of capacity remaining under the 2021 Share Repurchase Program at March 31, 2021. (2) For the three months ended March 31, 2021 and 2020, the amount includes 13 million shares and 45 million shares, respectively, related to the accelerated share repurchase agreement described below. (3) For the three months ended March 31, 2021, the amount includes 28.5 million shares related to the settlement of our common stock tender offer described below. (4) Average purchase price per share includes purchase commission costs. (5) Comprised of shares withheld from stock option exercises and vesting of restricted stock for employees’ tax withholding obligations and shares tendered by employees to satisfy option exercise costs. (6) |
Earnings per Common Share (Tabl
Earnings per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share, basic and diluted | A reconciliation of the numerators and denominators of the basic and diluted EPS calculations follows. Three Months Ended March 31, (In thousands, except per share data) 2021 2020 Numerator: Net income $ 641,207 $ 362,173 Preferred stock dividends 1,201 3,464 Net income attributable to SLM Corporation common stock $ 640,006 $ 358,709 Denominator: Weighted average shares used to compute basic EPS 361,042 409,786 Effect of dilutive securities: Dilutive effect of stock options, restricted stock, restricted stock units, performance stock units and Employee Stock Purchase Plan (“ESPP”) (1)(2) 5,198 2,969 Weighted average shares used to compute diluted EPS 366,240 412,755 Basic earnings per common share attributable to SLM Corporation $ 1.77 $ 0.88 Diluted earnings per common share attributable to SLM Corporation $ 1.75 $ 0.87 ________________ (1) Includes the potential dilutive effect of additional common shares that are issuable upon exercise of outstanding stock options, restricted stock, restricted stock units, performance stock units and the outstanding commitment to issue shares under the ESPP, determined by the treasury stock method. (2) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Valuation of financial instruments that are marked-to-market on recurring basis | The following table summarizes the valuation of our financial instruments that are marked to fair value on a recurring basis. Fair Value Measurements on a Recurring Basis March 31, 2021 December 31, 2020 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets Trading investments $ — $ — $ 30,594 $ 30,594 $ — $ — $ 16,923 $ 16,923 Available-for-sale investments — 2,115,885 — 2,115,885 — 1,996,634 — 1,996,634 Derivative instruments — 1,054 — 1,054 — 729 — 729 Total $ — $ 2,116,939 $ 30,594 $ 2,147,533 $ — $ 1,997,363 $ 16,923 $ 2,014,286 Liabilities Derivative instruments $ — $ (451) $ — $ (451) $ — $ (287) $ — $ (287) Total $ — $ (451) $ — $ (451) $ — $ (287) $ — $ (287) |
Fair values of financial assets and liabilities, including derivative financial instruments | The following table summarizes the fair values of our financial assets and liabilities, including derivative financial instruments. March 31, 2021 December 31, 2020 Fair Carrying Difference Fair Carrying Difference Earning assets: Loans held for investment, net: Private Education Loans $ 22,889,920 $ 19,632,933 $ 3,256,987 $ 22,124,171 $ 18,436,968 $ 3,687,203 FFELP Loans 738,579 725,300 13,279 748,657 735,208 13,449 Credit Cards 11,332 10,054 1,278 12,249 10,967 1,282 Loans held for sale — — — 3,226,029 2,885,640 340,389 Cash and cash equivalents 6,207,001 6,207,001 — 4,455,292 4,455,292 — Trading investments 30,594 30,594 — 16,923 16,923 — Available-for-sale investments 2,115,885 2,115,885 — 1,996,634 1,996,634 — Accrued interest receivable 1,373,593 1,264,960 108,633 1,527,816 1,387,305 140,511 Tax indemnification receivable 15,678 15,678 — 18,492 18,492 — Derivative instruments 1,054 1,054 — 729 729 — Total earning assets $ 33,383,636 $ 30,003,459 $ 3,380,177 $ 34,126,992 $ 29,944,158 $ 4,182,834 Interest-bearing liabilities: Money-market and savings accounts $ 11,961,848 $ 11,907,142 $ (54,706) $ 11,136,560 $ 11,067,633 $ (68,927) Certificates of deposit 11,048,527 10,894,181 (154,346) 11,799,223 11,597,266 (201,957) Long-term borrowings 5,117,766 4,918,670 (199,096) 5,398,309 5,189,217 (209,092) Accrued interest payable 79,231 79,231 — 60,272 60,272 — Derivative instruments 451 451 — 287 287 — Total interest-bearing liabilities $ 28,207,823 $ 27,799,675 $ (408,148) $ 28,394,651 $ 27,914,675 $ (479,976) Excess of net asset fair value over carrying value $ 2,972,029 $ 3,702,858 |
Regulatory Capital (Tables)
Regulatory Capital (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Banking and Thrift, Other Disclosures [Abstract] | |
Schedule of compliance with regulatory capital requirements under banking regulations | The following capital amounts and ratios are based upon the Bank’s average assets and risk-weighted assets, as indicated. Actual U.S. Basel III Minimum Requirements Plus Buffer (1)(2) Amount Ratio Amount Ratio As of March 31, 2021: Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 3,164,962 13.5 % $ 1,637,155 > 7.0 % Tier 1 Capital (to Risk-Weighted Assets) $ 3,164,962 13.5 % $ 1,987,974 > 8.5 % Total Capital (to Risk-Weighted Assets) $ 3,230,743 13.8 % $ 2,455,732 > 10.5 % Tier 1 Capital (to Average Assets) $ 3,164,962 10.0 % $ 1,271,568 > 4.0 % As of December 31, 2020: Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 3,579,005 14.0 % $ 1,794,780 > 7.0 % Tier 1 Capital (to Risk-Weighted Assets) $ 3,579,005 14.0 % $ 2,179,375 > 8.5 % Total Capital (to Risk-Weighted Assets) $ 3,849,820 15.0 % $ 2,692,169 > 10.5 % Tier 1 Capital (to Average Assets) $ 3,579,005 11.3 % $ 1,264,424 > 4.0 % ________________ (1) Reflects the U.S. Basel III minimum required ratio plus the applicable capital conservation buffer. (2) |
Investments - Additional Inform
Investments - Additional Information (Details) $ in Thousands | Feb. 09, 2021 | Mar. 31, 2020 | Mar. 31, 2021USD ($)security | Dec. 31, 2020USD ($)security |
Investment Holdings [Line Items] | ||||
Vertical risk retention interest | 5.00% | 5.00% | 5.00% | |
Trading investments | $ 30,594 | $ 16,923 | ||
Number of mortgage-backed securities with unrealized losses | security | 40 | 14 | ||
Number of mortgage-backed securities | security | 175 | 163 | ||
Available-for-sale investments, cost | $ 2,116,279 | $ 1,986,957 | ||
Par value of mortgage-backed securities pledged to FRB | 786,000 | 815,000 | ||
Non-marketable securities investment | 26,000 | 26,000 | ||
Low income housing tax credit investments | 52,000 | 54,000 | ||
Low income housing tax credit investments, liability for unfunded commitments | 15,000 | 19,000 | ||
Low income housing tax credit investments, tax credits and benefits | $ 1,000 | $ 6,000 | ||
Low income housing tax credit investments, expected tax benefits recognized | 25.00% |
Investments - Amortized Cost an
Investments - Amortized Cost and Fair Value of Securities Available for Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 2,116,279 | $ 1,986,957 |
Allowance for credit losses | 0 | 0 |
Gross Unrealized Gains | 6,922 | 10,162 |
Gross Unrealized Losses | (7,316) | (485) |
Estimated Fair Value | 2,115,885 | 1,996,634 |
Mortgage-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 348,080 | 308,913 |
Allowance for credit losses | 0 | 0 |
Gross Unrealized Gains | 3,492 | 6,095 |
Gross Unrealized Losses | (6,545) | (134) |
Estimated Fair Value | 345,027 | 314,874 |
Utah Housing Corporation bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 8,375 | 12,357 |
Allowance for credit losses | 0 | 0 |
Gross Unrealized Gains | 80 | 210 |
Gross Unrealized Losses | (15) | 0 |
Estimated Fair Value | 8,440 | 12,567 |
U.S. government-sponsored enterprises and Treasuries | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,560,848 | 1,596,890 |
Allowance for credit losses | 0 | 0 |
Gross Unrealized Gains | 2,581 | 3,395 |
Gross Unrealized Losses | (146) | 0 |
Estimated Fair Value | 1,563,283 | 1,600,285 |
Other securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 198,976 | 68,797 |
Allowance for credit losses | 0 | 0 |
Gross Unrealized Gains | 769 | 462 |
Gross Unrealized Losses | (610) | (351) |
Estimated Fair Value | $ 199,135 | $ 68,908 |
Investments - Gross Unrealized
Investments - Gross Unrealized Losses and Fair Value for Mortgage-Backed in Unrealized Loss Position (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Less than 12 months | ||
Gross Unrealized Losses | $ (7,045) | $ (485) |
Estimated Fair Value | 451,216 | 76,452 |
12 months or more | ||
Gross Unrealized Losses | (271) | 0 |
Estimated Fair Value | 12,776 | 0 |
Total | ||
Gross Unrealized Losses | (7,316) | (485) |
Estimated Fair Value | 463,992 | 76,452 |
Mortgage-backed securities | ||
Less than 12 months | ||
Gross Unrealized Losses | (6,545) | (134) |
Estimated Fair Value | 242,386 | 46,011 |
12 months or more | ||
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 0 | 0 |
Total | ||
Gross Unrealized Losses | (6,545) | (134) |
Estimated Fair Value | 242,386 | 46,011 |
Utah Housing Corporation bonds | ||
Less than 12 months | ||
Gross Unrealized Losses | (15) | 0 |
Estimated Fair Value | 4,357 | 0 |
12 months or more | ||
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 0 | 0 |
Total | ||
Gross Unrealized Losses | (15) | 0 |
Estimated Fair Value | 4,357 | 0 |
U.S. government-sponsored enterprises and Treasuries | ||
Less than 12 months | ||
Gross Unrealized Losses | (146) | 0 |
Estimated Fair Value | 114,870 | 0 |
12 months or more | ||
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 0 | 0 |
Total | ||
Gross Unrealized Losses | (146) | 0 |
Estimated Fair Value | 114,870 | 0 |
Other securities | ||
Less than 12 months | ||
Gross Unrealized Losses | (339) | (351) |
Estimated Fair Value | 89,603 | 30,441 |
12 months or more | ||
Gross Unrealized Losses | (271) | 0 |
Estimated Fair Value | 12,776 | 0 |
Total | ||
Gross Unrealized Losses | (610) | (351) |
Estimated Fair Value | $ 102,379 | $ 30,441 |
Investments - Maturity Table (D
Investments - Maturity Table (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 2,116,279 | $ 1,986,957 |
Estimated Fair Value | 2,115,885 | $ 1,996,634 |
2021 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 293,759 | |
Estimated Fair Value | 294,232 | |
2022 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,018,268 | |
Estimated Fair Value | 1,019,960 | |
2023 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 148,822 | |
Estimated Fair Value | 149,166 | |
2024 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 100,000 | |
Estimated Fair Value | 99,925 | |
2038 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 76 | |
Estimated Fair Value | 88 | |
2039 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,601 | |
Estimated Fair Value | 1,773 | |
2042 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 4,201 | |
Estimated Fair Value | 4,206 | |
2043 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 7,415 | |
Estimated Fair Value | 7,711 | |
2044 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 10,133 | |
Estimated Fair Value | 10,610 | |
2045 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 8,870 | |
Estimated Fair Value | 9,179 | |
2046 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 14,414 | |
Estimated Fair Value | 14,797 | |
2047 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 18,646 | |
Estimated Fair Value | 18,992 | |
2048 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 4,362 | |
Estimated Fair Value | 4,545 | |
2049 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 36,368 | |
Estimated Fair Value | 37,683 | |
2050 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 174,919 | |
Estimated Fair Value | 170,740 | |
2051 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 75,449 | |
Estimated Fair Value | 73,143 | |
2053 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 134,414 | |
Estimated Fair Value | 134,289 | |
2054 | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 64,562 | |
Estimated Fair Value | $ 64,846 |
Loans Held for Investment - Add
Loans Held for Investment - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 01, 2006 | Jun. 30, 2006 | Sep. 30, 1993 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Percent of private loans indexed to LIBOR | 54.00% | 55.00% | |||||
Tier 1 of government guarantee (at least) | 97.00% | 97.00% | |||||
Tier 2 of government guarantee | 98.00% | ||||||
Tier 3 of government guarantee | 100.00% | ||||||
Gain from sale | $ 399,111 | $ 238,935 | |||||
Proceeds from sale of loans receivable | 3,160,000 | ||||||
Net proceeds from sales of loans held for investment, principal | 2,970,000 | ||||||
Net proceeds from sales of loans held for investment, capitalized interest | $ 193,000 | ||||||
Estimated weighted average life of student loans | 4 years 7 months 6 days | 5 years 4 months 24 days | |||||
Allowance for credit losses on loans and leases | $ 1,179,021 | 1,673,324 | $ 1,361,723 | $ 441,912 | |||
Interest rate reduction | 4.00% | ||||||
Interest rate offered to borrowers facing financial difficulty | 4.00% | ||||||
Interest rate offered to borrowers facing financial difficulty, period | 2 years | ||||||
Loans currently in repayment status that were subject to interest rate reductions | 8.10% | 7.80% | |||||
Minimum | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Loans expected to have accelerated default rates and increases to loan life | 4.00% | ||||||
Maximum | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Interest rate offered to borrowers facing financial difficulty | 4.00% | ||||||
Loans expected to have accelerated default rates and increases to loan life | 14.00% | ||||||
Private Education Loan, Extended Loan | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Allowance for credit losses on loans and leases | $ 784,000 | ||||||
Personal Loans | |||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||
Allowance for credit losses on loans and leases | $ 152,673 | $ 65,877 |
Loans Held for Investment - Stu
Loans Held for Investment - Student Loan Portfolio by Program (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Allowance for credit losses | $ (1,179,021) | $ (1,361,723) | $ (1,673,324) | $ (441,912) |
Loans held for investment, net | 20,368,287 | 19,183,143 | ||
Private Education Loans | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loan type | 20,741,840 | 19,729,337 | ||
Deferred origination costs and unamortized premium/(discount) | 64,468 | 63,475 | ||
Allowance for credit losses | (1,173,375) | (1,355,844) | ||
Loans held for investment, net | 19,632,933 | 18,436,968 | ||
Private Education Loans | Fixed-rate | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loan type | 9,504,760 | 8,950,216 | ||
Private Education Loans | Variable-rate | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loan type | 11,237,080 | 10,779,121 | ||
FFELP Loans | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loan type | 727,664 | 737,593 | ||
Deferred origination costs and unamortized premium/(discount) | 1,954 | 1,993 | ||
Allowance for credit losses | (4,318) | (4,378) | ||
Loans held for investment, net | 725,300 | 735,208 | ||
Credit Cards | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Loan type | 11,309 | 12,238 | ||
Deferred origination costs and unamortized premium/(discount) | 73 | 230 | ||
Allowance for credit losses | (1,328) | (1,501) | ||
Loans held for investment, net | $ 10,054 | $ 10,967 |
Loans Held for Investment - S_2
Loans Held for Investment - Student Loan Portfolio Average Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Average Balance | $ 21,730,621 | $ 25,258,127 |
Private Education Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Average Balance | $ 20,984,491 | $ 23,502,844 |
Weighted Average Interest Rate | 8.22% | 8.86% |
FFELP Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Average Balance | $ 734,289 | $ 776,326 |
Weighted Average Interest Rate | 3.41% | 4.29% |
Personal Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Average Balance | $ 0 | $ 973,671 |
Weighted Average Interest Rate | 0.00% | 12.11% |
Credit Cards | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Average Balance | $ 11,841 | $ 5,286 |
Weighted Average Interest Rate | 0.78% | (4.72%) |
Loans Held for Sale (Details)
Loans Held for Sale (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Transfers and Servicing [Abstract] | |||
Loans held for sale | $ 0 | $ 2,885,640 | |
Loan transfer to held-for-sale | $ 206,000 | ||
Proceeds from sale of loans receivable | 3,160,000 | ||
Net proceeds from sales of loans held for investment, principal | 2,970,000 | ||
Net proceeds from sales of loans held for investment, capitalized interest | 193,000 | ||
Gain from sale | $ 399,111 | $ 238,935 |
Allowance for Credit Losses - A
Allowance for Credit Losses - Allowance and Recorded Investments in Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Allowance for Credit Losses | ||||
Beginning balance | $ 1,361,723 | $ 441,912 | $ 441,912 | |
Transfer from unfunded commitment liability | 142,075 | |||
Provision for current period | (254,999) | 169,508 | ||
Loan sale reduction to provision | (8,858) | (161,793) | ||
Loan transfer from held-for-sale | 1,887 | |||
Total provision | 261,970 | (7,715) | ||
Net charge-offs: | ||||
Charge-offs | (55,316) | (70,949) | ||
Recoveries | 7,704 | 9,518 | ||
Net charge-offs | (47,612) | (61,431) | ||
Loan sales | 0 | |||
Ending Balance | 1,179,021 | 1,673,324 | 1,361,723 | |
Allowance | ||||
Ending balance: individually evaluated for impairment | 95,536 | 150,822 | ||
Ending balance: collectively evaluated for impairment | 1,083,485 | 1,522,502 | ||
Loans: | ||||
Ending balance: individually evaluated for impairment | 1,225,604 | 1,518,763 | ||
Ending balance: collectively evaluated for impairment | 20,255,209 | 21,781,876 | ||
Provisions for loan losses | (261,913) | (17,931) | ||
Provisions for unfunded loan commitments | 36,203 | 53,543 | ||
Total Private Education Loan provisions for credit losses | (225,710) | 35,612 | ||
Private Education Loan provision for credit losses, other impacts | (57) | 25,646 | ||
Less: provisions for credit losses | (225,767) | 61,258 | ||
Cumulative Effect, Period Of Adoption, Adjustment | ||||
Allowance for Credit Losses | ||||
Beginning balance | 1,584,965 | 1,584,965 | ||
Transfer from unfunded commitment liability | 126,880 | |||
Net charge-offs: | ||||
Day 1 adjustment for the adoption of CECL | $ 1,143,053 | |||
FFELP Loans | ||||
Allowance for Credit Losses | ||||
Beginning balance | 4,378 | 1,633 | 1,633 | |
Transfer from unfunded commitment liability | 0 | |||
Provision for current period | 29 | 37 | ||
Loan sale reduction to provision | 0 | 0 | ||
Loan transfer from held-for-sale | 0 | |||
Total provision | (29) | (37) | ||
Net charge-offs: | ||||
Charge-offs | (89) | (226) | ||
Recoveries | 0 | 0 | ||
Net charge-offs | (89) | (226) | ||
Loan sales | 0 | |||
Ending Balance | 4,318 | 4,296 | 4,378 | |
Allowance | ||||
Ending balance: individually evaluated for impairment | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | 4,318 | 4,296 | ||
Loans: | ||||
Ending balance: individually evaluated for impairment | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | $ 727,664 | $ 766,954 | ||
Net charge-offs as a percentage of average loans in repayment (annualized) | 0.06% | 0.15% | ||
Allowance as a percentage of the ending total loan balance | 0.59% | 0.56% | ||
Allowance as a percentage of the ending loans in repayment | 0.80% | 0.74% | ||
Allowance coverage of net charge-offs (annualized) | 12.13 | 4.75 | ||
Ending total loans, gross | $ 727,664 | $ 766,954 | ||
Average loans in repayment | 554,510 | 600,534 | ||
Ending loans in repayment | 540,903 | 581,997 | ||
Private Education Loan provision for credit losses, other impacts | 29 | 37 | ||
FFELP Loans | Cumulative Effect, Period Of Adoption, Adjustment | ||||
Allowance for Credit Losses | ||||
Beginning balance | 4,485 | 4,485 | ||
Transfer from unfunded commitment liability | 0 | |||
Net charge-offs: | ||||
Day 1 adjustment for the adoption of CECL | 2,852 | |||
Private Education Loans | ||||
Allowance for Credit Losses | ||||
Beginning balance | 1,355,844 | 374,300 | 374,300 | |
Transfer from unfunded commitment liability | 142,075 | |||
Provision for current period | (254,942) | 143,862 | ||
Loan sale reduction to provision | (8,858) | (161,793) | ||
Loan transfer from held-for-sale | 1,887 | |||
Total provision | 261,913 | 17,931 | ||
Net charge-offs: | ||||
Charge-offs | (55,139) | (51,469) | ||
Recoveries | 7,703 | 7,976 | ||
Net charge-offs | (47,436) | (43,493) | ||
Loan sales | 0 | |||
Ending Balance | 1,173,375 | 1,515,781 | 1,355,844 | |
Allowance | ||||
Ending balance: individually evaluated for impairment | 95,536 | 150,822 | ||
Ending balance: collectively evaluated for impairment | 1,077,839 | 1,364,959 | ||
Loans: | ||||
Ending balance: individually evaluated for impairment | 1,225,604 | 1,518,763 | ||
Ending balance: collectively evaluated for impairment | $ 19,516,236 | $ 20,107,984 | ||
Net charge-offs as a percentage of average loans in repayment (annualized) | 1.29% | 1.05% | ||
Allowance as a percentage of the ending total loan balance | 5.66% | 7.01% | ||
Allowance as a percentage of the ending loans in repayment | 7.94% | 10.11% | ||
Allowance coverage of net charge-offs (annualized) | 6.18 | 8.71 | ||
Ending total loans, gross | $ 20,741,840 | $ 21,626,747 | ||
Average loans in repayment | 14,743,508 | 16,521,356 | ||
Ending loans in repayment | 14,777,939 | 14,988,345 | ||
Private Education Loans | Cumulative Effect, Period Of Adoption, Adjustment | ||||
Allowance for Credit Losses | ||||
Beginning balance | 1,435,130 | 1,435,130 | ||
Transfer from unfunded commitment liability | 126,880 | |||
Net charge-offs: | ||||
Day 1 adjustment for the adoption of CECL | 1,060,830 | |||
Personal Loans | ||||
Allowance for Credit Losses | ||||
Beginning balance | 65,877 | 65,877 | ||
Transfer from unfunded commitment liability | 0 | |||
Provision for current period | 25,318 | |||
Loan sale reduction to provision | 0 | |||
Total provision | (25,318) | |||
Net charge-offs: | ||||
Charge-offs | (19,247) | |||
Recoveries | 1,542 | |||
Net charge-offs | (17,705) | |||
Ending Balance | 152,673 | |||
Allowance | ||||
Ending balance: individually evaluated for impairment | 0 | |||
Ending balance: collectively evaluated for impairment | 152,673 | |||
Loans: | ||||
Ending balance: individually evaluated for impairment | 0 | |||
Ending balance: collectively evaluated for impairment | $ 899,704 | |||
Net charge-offs as a percentage of average loans in repayment (annualized) | 7.27% | |||
Allowance as a percentage of the ending total loan balance | 16.97% | |||
Allowance as a percentage of the ending loans in repayment | 16.97% | |||
Allowance coverage of net charge-offs (annualized) | 2.16 | |||
Ending total loans, gross | $ 899,704 | |||
Average loans in repayment | 973,772 | |||
Ending loans in repayment | 899,704 | |||
Private Education Loan provision for credit losses, other impacts | 25,318 | |||
Personal Loans | Cumulative Effect, Period Of Adoption, Adjustment | ||||
Allowance for Credit Losses | ||||
Beginning balance | 145,060 | 145,060 | ||
Net charge-offs: | ||||
Day 1 adjustment for the adoption of CECL | 79,183 | |||
Credit Cards | ||||
Allowance for Credit Losses | ||||
Beginning balance | 1,501 | 102 | 102 | |
Transfer from unfunded commitment liability | 0 | |||
Provision for current period | (86) | 291 | ||
Loan sale reduction to provision | 0 | 0 | ||
Loan transfer from held-for-sale | 0 | |||
Total provision | 86 | (291) | ||
Net charge-offs: | ||||
Charge-offs | (88) | (7) | ||
Recoveries | 1 | 0 | ||
Net charge-offs | (87) | (7) | ||
Loan sales | 0 | |||
Ending Balance | 1,328 | 574 | 1,501 | |
Allowance | ||||
Ending balance: individually evaluated for impairment | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | 1,328 | 574 | ||
Loans: | ||||
Ending balance: individually evaluated for impairment | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | $ 11,309 | $ 7,234 | ||
Net charge-offs as a percentage of average loans in repayment (annualized) | 2.92% | 0.52% | ||
Allowance as a percentage of the ending total loan balance | 11.74% | 7.93% | ||
Allowance as a percentage of the ending loans in repayment | 11.74% | 7.93% | ||
Allowance coverage of net charge-offs (annualized) | 3.82 | 20.50 | ||
Ending total loans, gross | $ 11,309 | $ 7,234 | ||
Average loans in repayment | 11,909 | 5,364 | ||
Ending loans in repayment | 11,309 | 7,234 | ||
Private Education Loan provision for credit losses, other impacts | (86) | 291 | ||
Credit Cards | Cumulative Effect, Period Of Adoption, Adjustment | ||||
Allowance for Credit Losses | ||||
Beginning balance | $ 290 | $ 290 | ||
Transfer from unfunded commitment liability | $ 0 | |||
Net charge-offs: | ||||
Day 1 adjustment for the adoption of CECL | $ 188 |
Allowance for Credit Losses -_2
Allowance for Credit Losses - Additional Information (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Jul. 01, 2006 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Provision for credit losses | $ (225,767,000) | $ 61,258,000 | ||
Reduction to provision for credit losses | $ 287,000,000 | |||
Interest rate offered to borrowers facing financial difficulty | 4.00% | |||
Interest rate offered to borrowers facing financial difficulty, period | 2 years | |||
Percentage of loans in full and interest repayment status that are subject to interest rate reductions | 8.10% | 8.50% | ||
Percentage of loans granted forbearance (as a percentage) | 47.00% | 47.00% | ||
Criteria for loans to be considered as nonperforming (greater than) | 90 days | |||
Tier 1 of government guarantee (at least) | 97.00% | 97.00% | ||
TDR payment default period (more than) | 60 days | |||
Percentage of FFELP loans insured and guaranteed (at least) | 97.00% | |||
Period of loans past due that have accrued interest (greater than) | 90 days | |||
Monthly payment that is smaller than the interest accrued on the loan in that month | $ 25 | |||
Maximum | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest rate offered to borrowers facing financial difficulty | 4.00% |
Allowance for Credit Losses - R
Allowance for Credit Losses - Recorded Investment, Unpaid Principal Balance and Related Allowance for TDR Loans (Details) - TDR Loans - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Recorded Investment | $ 1,263,651 | $ 1,312,805 |
Unpaid Principal Balance | 1,225,604 | 1,274,590 |
Allowance | $ 95,536 | $ 104,265 |
Allowance for Credit Losses -_3
Allowance for Credit Losses - Average Recorded Investment and Interest Income Recognized for TDR (Details) - TDR Loans - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Average Recorded Investment | $ 1,288,333 | $ 1,615,764 |
Interest Income Recognized | $ 21,489 | $ 26,488 |
Allowance for Credit Losses - L
Allowance for Credit Losses - Loan Status and Aging of Past Due TDR Loans (Details) - Student Loan - Consumer Portfolio Segment - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
TDR loans in repayment and percentage of each status: | ||
Total Private Education Loans in repayment, 2021 | $ 418,469 | |
Total | 14,471,427 | $ 13,898,948 |
Troubled Debt Restructured Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
TDR loans in in-school/grace/deferment | 93,850 | 88,750 |
TDR loans in repayment and percentage of each status: | ||
Total Private Education Loans in forbearance, 2021 | 68,609 | 76,704 |
Loans current | 966,201 | 971,880 |
Total Private Education Loans in repayment, 2021 | $ 1,063,145 | $ 1,109,136 |
Loans current | 90.90% | 87.70% |
Total TDR loans in repayment | 100.00% | 100.00% |
Total | $ 1,225,604 | $ 1,274,590 |
Loan delinquency 30-59 days | ||
TDR loans in repayment and percentage of each status: | ||
Total | 152,743 | 205,528 |
Loan delinquency 30-59 days | Troubled Debt Restructured Loans | ||
TDR loans in repayment and percentage of each status: | ||
Loans delinquent | $ 39,541 | $ 59,249 |
Loans delinquent | 3.70% | 5.30% |
Loan delinquency 60-89 days | ||
TDR loans in repayment and percentage of each status: | ||
Total | $ 86,390 | $ 119,643 |
Loan delinquency 60-89 days | Troubled Debt Restructured Loans | ||
TDR loans in repayment and percentage of each status: | ||
Loans delinquent | $ 29,892 | $ 43,576 |
Loans delinquent | 2.80% | 3.90% |
Loan delinquency 90 days or greater past due | ||
TDR loans in repayment and percentage of each status: | ||
Total | $ 67,379 | $ 80,702 |
Loan delinquency 90 days or greater past due | Troubled Debt Restructured Loans | ||
TDR loans in repayment and percentage of each status: | ||
Loans delinquent | $ 27,511 | $ 34,431 |
Loans delinquent | 2.60% | 3.10% |
Allowance for Credit Losses - M
Allowance for Credit Losses - Modified Loan Accounts for TDR (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Receivables [Abstract] | ||
Modified Loans | $ 3,717 | $ 132,815 |
Charge-offs | 17,948 | 19,375 |
Payment- Default | $ 4,869 | $ 30,725 |
Allowance for Credit Losses -_4
Allowance for Credit Losses - Loan Portfolio Stratified by Key Credit Quality Indicators (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Current period gross charge-offs, total | $ (55,316) | $ (70,949) | |
Current period recoveries, total | 7,704 | 9,518 | |
Net charge-offs | (47,612) | $ (61,431) | |
Consumer Portfolio Segment | Student Loan | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 418,103 | ||
2020 | 2,747,747 | $ 2,043,033 | |
2019 | 2,491,380 | 2,573,228 | |
2018 | 1,955,468 | 2,045,012 | |
2017 | 1,755,863 | 1,850,539 | |
2016 and prior | 5,102,866 | 1,685,572 | |
2015 and Prior | 3,701,564 | ||
Total | 14,471,427 | 13,898,948 | |
Current period gross charge-offs | (6) | ||
Current period gross charge-offs | (911) | (1,087) | |
Current period gross charge-offs | (4,483) | (10,940) | |
Current period gross charge-offs | (8,116) | (27,000) | |
Current period gross charge-offs | (8,793) | (35,851) | |
Current period gross charge-offs | (32,830) | (36,416) | |
Current period gross charge-offs | (94,032) | ||
Current period gross charge-offs, total | (55,139) | (205,326) | |
Current period recoveries | 0 | ||
Current period recoveries | 43 | 42 | |
Current period recoveries | 452 | 636 | |
Current period recoveries | 1,009 | 2,274 | |
Current period recoveries | 1,133 | 3,585 | |
Current period recoveries | 5,066 | 4,284 | |
Current period recoveries | 13,200 | ||
Current period recoveries, total | 7,703 | 24,021 | |
Current period net charge-offs | (6) | ||
Current period net charge-offs | (868) | (1,045) | |
Current period net charge-offs | (4,031) | (10,304) | |
Current period net charge-offs | (7,107) | (24,726) | |
Current period net charge-offs | (7,660) | (32,266) | |
Current period net charge-offs | (27,764) | (32,132) | |
Current period net charge-offs | (80,832) | ||
Net charge-offs | (47,436) | (181,305) | |
Total accrued interest by origination vintage, 2021 | 8,317 | ||
Total accrued interest by origination vintage, 2020 | 147,329 | 90,438 | |
Total accrued interest by origination vintage, 2019 | 291,579 | 265,688 | |
Total accrued interest by origination vintage, 2018 | 258,813 | 252,251 | |
Total accrued interest by origination vintage, 2017 | 206,734 | 209,178 | |
Total accrued interest by origination vintage, 2016 and prior | 335,703 | 141,094 | |
Total accrued interest by origination vintage, 2015 and prior | 210,247 | ||
Total accrued interest by origination vintage | 1,248,475 | 1,168,896 | |
Consumer Portfolio Segment | Student Loan | With Cosigner | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 640,909 | ||
2020 | 3,954,261 | 2,915,328 | |
2019 | 3,331,066 | 3,467,219 | |
2018 | 2,431,585 | 2,556,400 | |
2017 | 2,137,418 | 2,262,635 | |
2016 and prior | 5,799,561 | 1,977,952 | |
2015 and Prior | 4,198,748 | ||
Total | $ 18,294,800 | $ 17,378,282 | |
Private education loans | 88.00% | 88.00% | |
Consumer Portfolio Segment | Student Loan | Without Cosigner | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 109,163 | ||
2020 | 623,156 | $ 527,437 | |
2019 | 531,211 | 559,629 | |
2018 | 359,769 | 384,111 | |
2017 | 259,981 | 277,159 | |
2016 and prior | 563,760 | 211,270 | |
2015 and Prior | 391,449 | ||
Total | $ 2,447,040 | $ 2,351,055 | |
Private education loans | 12.00% | 12.00% | |
Consumer Portfolio Segment | Student Loan | Cosigners | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 750,072 | ||
2020 | 4,577,417 | $ 3,442,765 | |
2019 | 3,862,277 | 4,026,848 | |
2018 | 2,791,354 | 2,940,511 | |
2017 | 2,397,399 | 2,539,794 | |
2016 and prior | 6,363,321 | 2,189,222 | |
2015 and Prior | 4,590,197 | ||
Total | $ 20,741,840 | $ 19,729,337 | |
Total in percent | 100.00% | 100.00% | |
Consumer Portfolio Segment | Student Loan | FICO at Original Approval | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 750,072 | ||
2020 | 4,577,417 | $ 3,442,765 | |
2019 | 3,862,277 | 4,026,848 | |
2018 | 2,791,354 | 2,940,511 | |
2017 | 2,397,399 | 2,539,794 | |
2016 and prior | 6,363,321 | 2,189,222 | |
2015 and Prior | 4,590,197 | ||
Total | $ 20,741,840 | $ 19,729,337 | |
Total in percent | 100.00% | 100.00% | |
Consumer Portfolio Segment | Student Loan | FICO at Original Approval | Less than 670 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 46,437 | ||
2020 | 253,657 | $ 195,214 | |
2019 | 283,992 | 290,711 | |
2018 | 217,921 | 225,276 | |
2017 | 189,704 | 197,948 | |
2016 and prior | 505,347 | 162,413 | |
2015 and Prior | 369,609 | ||
Total | $ 1,497,058 | $ 1,441,171 | |
Private education loans at origination | 7.00% | 7.00% | |
Consumer Portfolio Segment | Student Loan | FICO at Original Approval | 670-699 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 103,191 | ||
2020 | 607,789 | $ 464,785 | |
2019 | 576,077 | 594,950 | |
2018 | 423,618 | 441,357 | |
2017 | 388,607 | 407,394 | |
2016 and prior | 1,061,435 | 351,303 | |
2015 and Prior | 771,477 | ||
Total | $ 3,160,717 | $ 3,031,266 | |
Private education loans at origination | 15.00% | 16.00% | |
Consumer Portfolio Segment | Student Loan | FICO at Original Approval | 700-749 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 243,607 | ||
2020 | 1,472,919 | $ 1,111,373 | |
2019 | 1,260,902 | 1,310,390 | |
2018 | 921,338 | 967,802 | |
2017 | 799,597 | 846,983 | |
2016 and prior | 2,138,263 | 740,028 | |
2015 and Prior | 1,533,517 | ||
Total | $ 6,836,626 | $ 6,510,093 | |
Private education loans at origination | 33.00% | 33.00% | |
Consumer Portfolio Segment | Student Loan | FICO at Original Approval | Greater than or equal to 750 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 356,837 | ||
2020 | 2,243,052 | $ 1,671,393 | |
2019 | 1,741,306 | 1,830,797 | |
2018 | 1,228,477 | 1,306,076 | |
2017 | 1,019,491 | 1,087,469 | |
2016 and prior | 2,658,276 | 935,478 | |
2015 and Prior | 1,915,594 | ||
Total | $ 9,247,439 | $ 8,746,807 | |
Private education loans at origination | 45.00% | 44.00% | |
Consumer Portfolio Segment | Student Loan | School FICO, Refreshed Amounts | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 750,072 | ||
2020 | 4,577,417 | $ 3,442,765 | |
2019 | 3,862,277 | 4,026,848 | |
2018 | 2,791,354 | 2,940,511 | |
2017 | 2,397,399 | 2,539,794 | |
2016 and prior | 6,363,321 | 2,189,222 | |
2015 and Prior | 4,590,197 | ||
Total | $ 20,741,840 | $ 19,729,337 | |
Total in percent | 100.00% | 100.00% | |
Consumer Portfolio Segment | Student Loan | School FICO, Refreshed Amounts | Less than 670 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 64,349 | ||
2020 | 313,569 | $ 240,154 | |
2019 | 325,235 | 331,229 | |
2018 | 290,041 | 301,784 | |
2017 | 283,988 | 298,195 | |
2016 and prior | 952,223 | 293,077 | |
2015 and Prior | 734,599 | ||
Total | $ 2,229,405 | $ 2,199,038 | |
Private education loans at origination | 11.00% | 11.00% | |
Consumer Portfolio Segment | Student Loan | School FICO, Refreshed Amounts | 670-699 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 107,242 | ||
2020 | 573,430 | $ 438,665 | |
2019 | 473,331 | 493,135 | |
2018 | 322,446 | 336,966 | |
2017 | 271,224 | 283,906 | |
2016 and prior | 707,135 | 231,759 | |
2015 and Prior | 504,779 | ||
Total | $ 2,454,808 | $ 2,289,210 | |
Private education loans at origination | 12.00% | 12.00% | |
Consumer Portfolio Segment | Student Loan | School FICO, Refreshed Amounts | 700-749 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 241,091 | ||
2020 | 1,442,851 | $ 1,102,666 | |
2019 | 1,186,242 | 1,248,806 | |
2018 | 813,884 | 871,677 | |
2017 | 684,467 | 734,222 | |
2016 and prior | 1,715,802 | 603,160 | |
2015 and Prior | 1,220,468 | ||
Total | $ 6,084,337 | $ 5,780,999 | |
Private education loans at origination | 29.00% | 29.00% | |
Consumer Portfolio Segment | Student Loan | School FICO, Refreshed Amounts | Greater than or equal to 750 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 337,390 | ||
2020 | 2,247,567 | $ 1,661,280 | |
2019 | 1,877,469 | 1,953,678 | |
2018 | 1,364,983 | 1,430,084 | |
2017 | 1,157,720 | 1,223,471 | |
2016 and prior | 2,988,161 | 1,061,226 | |
2015 and Prior | 2,130,351 | ||
Total | $ 9,973,290 | $ 9,460,090 | |
Private education loans at origination | 48.00% | 48.00% | |
Consumer Portfolio Segment | Student Loan | Seasoning | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 750,072 | ||
2020 | 4,577,417 | $ 3,442,765 | |
2019 | 3,862,277 | 4,026,848 | |
2018 | 2,791,354 | 2,940,511 | |
2017 | 2,397,399 | 2,539,794 | |
2016 and prior | 6,363,321 | 2,189,222 | |
2015 and Prior | 4,590,197 | ||
Total | $ 20,741,840 | $ 19,729,337 | |
Seasoning based on monthly scheduled payments due from 1-12 payments | 24.00% | 23.00% | |
Seasoning based on monthly scheduled payments due from 13 - 24 payments | 16.00% | 17.00% | |
Seasoning based on monthly scheduled payments due from 25 - 36 payments | 11.00% | 12.00% | |
Seasoning based on monthly scheduled payments due from 37 - 48 payments | 8.00% | 9.00% | |
Seasoning based on monthly scheduled payments due from more than 48 payments | 15.00% | 15.00% | |
Seasoning based on monthly scheduled payments due from not yet in repayment | 26.00% | 24.00% | |
Total in percent | 100.00% | 100.00% | |
Consumer Portfolio Segment | Student Loan | Seasoning | 1-12 payments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | $ 419,655 | ||
2020 | 2,510,639 | $ 2,068,517 | |
2019 | 426,229 | 600,038 | |
2018 | 396,679 | 469,143 | |
2017 | 392,391 | 472,258 | |
2016 and prior | 718,899 | 381,197 | |
2015 and Prior | 507,343 | ||
Total | 4,864,492 | 4,498,496 | |
Consumer Portfolio Segment | Student Loan | Seasoning | 13-24 payments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 0 | ||
2020 | 267,856 | 163 | |
2019 | 2,034,191 | 2,096,635 | |
2018 | 254,139 | 383,977 | |
2017 | 221,863 | 223,332 | |
2016 and prior | 599,435 | 217,379 | |
2015 and Prior | 425,345 | ||
Total | 3,377,484 | 3,346,831 | |
Consumer Portfolio Segment | Student Loan | Seasoning | 25-36 payments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 0 | ||
2020 | 0 | 0 | |
2019 | 146,616 | 0 | |
2018 | 1,343,321 | 1,353,567 | |
2017 | 250,078 | 370,250 | |
2016 and prior | 581,741 | 181,940 | |
2015 and Prior | 439,337 | ||
Total | 2,321,756 | 2,345,094 | |
Consumer Portfolio Segment | Student Loan | Seasoning | 37-48 payments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 0 | ||
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 93,298 | 0 | |
2017 | 978,808 | 965,476 | |
2016 and prior | 618,454 | 351,433 | |
2015 and Prior | 402,552 | ||
Total | 1,690,560 | 1,719,461 | |
Consumer Portfolio Segment | Student Loan | Seasoning | More than 48 payments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 0 | ||
2020 | 0 | 0 | |
2019 | 0 | 0 | |
2018 | 0 | 0 | |
2017 | 64,660 | 0 | |
2016 and prior | 3,029,214 | 729,510 | |
2015 and Prior | 2,310,905 | ||
Total | 3,093,874 | 3,040,415 | |
Consumer Portfolio Segment | Student Loan | Seasoning | Not yet in repayment | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
2021 | 330,417 | ||
2020 | 1,798,922 | 1,374,085 | |
2019 | 1,255,241 | 1,330,175 | |
2018 | 703,917 | 733,824 | |
2017 | 489,599 | 508,478 | |
2016 and prior | 815,578 | 327,763 | |
2015 and Prior | 504,715 | ||
Total | $ 5,393,674 | $ 4,779,040 |
Allowance for Credit Losses -_5
Allowance for Credit Losses - Age Analysis of Past Due Loans Delinquencies (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Private Education Loans allowance for losses | $ (1,179,021) | $ (1,361,723) | $ (1,673,324) | $ (441,912) |
Loans held for investment, net | $ 20,368,287 | $ 19,183,143 | ||
Percentage of Private Education Loans in repayment, 2021 | 55.80% | 59.60% | ||
Percentage of Private Education Loans in repayment, 2020 | 60.20% | 64.70% | ||
Percentage of Private Education Loans in repayment, 2019 | 65.20% | 71.30% | ||
Percentage of Private Education Loans in repayment, 2018 | 71.40% | 75.30% | ||
Percentage of Private Education Loans in repayment, 2017 | 75.20% | 80.00% | ||
Percentage of Private Education Loans in repayment, 2016 and prior | 83.10% | 84.70% | ||
Percentage of Private Education Loans in repayment | 71.20% | 72.50% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment, 2021 | 0.10% | 0.50% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment, 2020 | 0.30% | 1.20% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment, 2019 | 1.00% | 2.40% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment, 2018 | 1.90% | 3.20% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment, 2017 | 2.70% | 3.80% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment, 2016 and prior | 3.50% | 4.80% | ||
Delinquent Private Education Loans in repayment as a percentage of Private Education Loans in repayment | 2.10% | 2.80% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance, 2021 | 0.30% | 0.80% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance, 2020 | 0.80% | 3.40% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance, 2019 | 3.40% | 5.00% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance, 2018 | 4.50% | 5.90% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance, 2017 | 5.40% | 5.90% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance, 2016 and Prior | 4.70% | 4.90% | ||
Loans in forbearance as a percentage of loans in repayment and forbearance | 3.70% | 4.30% | ||
Student Loan | Consumer Portfolio Segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
2021 | $ 418,103 | |||
2020 | 2,747,747 | $ 2,043,033 | ||
2019 | 2,491,380 | 2,573,228 | ||
2018 | 1,955,468 | 2,045,012 | ||
2017 | 1,755,863 | 1,850,539 | ||
2016 and prior | 5,102,866 | 1,685,572 | ||
2015 and Prior | 3,701,564 | |||
Total | 14,471,427 | 13,898,948 | ||
Total Private Education Loans in repayment, 2021 | 418,469 | |||
Total Private Education Loans in repayment, 2020 | 2,757,024 | 2,052,521 | ||
Total Private Education Loans in repayment, 2019 | 2,517,627 | 2,603,996 | ||
Total Private Education Loans in repayment, 2018 | 1,993,924 | 2,096,368 | ||
Total Private Education Loans in repayment, 2017 | 1,803,993 | 1,912,370 | ||
Total Private Education Loans in repayment, 2016 | 5,286,902 | 1,752,386 | ||
Total Private Education Loans in repayment, 2015 and prior | 3,887,180 | |||
Total Private Education Loans in repayment | 14,777,939 | 14,304,821 | ||
Total Private Education Loans, gross, 2021 | 750,072 | 3,442,765 | ||
Total Private Education Loans, gross, 2020 | 4,577,417 | 4,026,848 | ||
Total Private Education Loans, gross, 2019 | 3,862,277 | 2,940,511 | ||
Total Private Education Loans, gross, 2018 | 2,791,354 | 2,539,794 | ||
Total Private Education Loans, gross, 2017 | 2,397,399 | 2,189,222 | ||
Total Private Education Loans, gross, 2016 and prior | 6,363,321 | 4,590,197 | ||
Total Private Education Loans, gross | 20,741,840 | 19,729,337 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), 2021 | 5,487 | 21,129 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), 2020 | 19,922 | 13,933 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), 2019 | 12,925 | 8,671 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), 2018 | 7,977 | 6,708 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), 2017 | 6,153 | 5,721 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), 2016 | 12,004 | 7,313 | ||
Private Education Loans deferred origination costs and unamortized premium/(discount), Total | 64,468 | 63,475 | ||
Total Private Education Loans, 2021 | 755,559 | 3,463,894 | ||
Total Private Education Loans, 2020 | 4,597,339 | 4,040,781 | ||
Total Private Education Loans, 2019 | 3,875,202 | 2,949,182 | ||
Total Private Education Loans, 2018 | 2,799,331 | 2,546,502 | ||
Total Private Education Loans, 2017 | 2,403,552 | 2,194,943 | ||
Total Private Education Loans, 2016 and Prior | 6,375,325 | 4,597,510 | ||
Total Private Education Loans | 20,806,308 | 19,792,812 | ||
Private Education Loans allowance for losses, 2021 | (35,515) | (210,875) | ||
Private Education Loans allowance for losses, 2020 | (252,247) | (298,776) | ||
Private Education Loans allowance for losses, 2019 | (239,917) | (218,136) | ||
Private Education Loans allowance for losses, 2018 | (169,296) | (184,265) | ||
Private Education Loans allowance for losses, 2017 | (140,894) | (150,150) | ||
Private Education Loans allowance for losses, 2016 and prior | (335,506) | (293,642) | ||
Private Education Loans allowance for losses | (1,173,375) | (1,355,844) | ||
Private Education Loans, net, 2021 | 720,044 | 3,253,019 | ||
Private Education Loans, net, 2020 | 4,345,092 | 3,742,005 | ||
Private Education Loans, net, 2019 | 3,635,285 | 2,731,046 | ||
Private Education Loans, net, 2018 | 2,630,035 | 2,362,237 | ||
Private Education Loans, net, 2017 | 2,262,658 | 2,044,793 | ||
Private Education Loans, net, 2016 and prior | 6,039,819 | 4,303,868 | ||
Loans held for investment, net | 19,632,933 | 18,436,968 | ||
Student Loan | Consumer Portfolio Segment | Loan delinquency 30-59 days | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
2021 | 366 | |||
2020 | 6,587 | 6,400 | ||
2019 | 14,015 | 16,983 | ||
2018 | 19,145 | 26,934 | ||
2017 | 24,043 | 30,771 | ||
2016 and prior | 88,587 | 33,040 | ||
2015 and Prior | 91,400 | |||
Total | 152,743 | 205,528 | ||
Student Loan | Consumer Portfolio Segment | Loan delinquency 60-89 days | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
2021 | 0 | |||
2020 | 1,747 | 2,628 | ||
2019 | 7,654 | 9,143 | ||
2018 | 11,064 | 15,026 | ||
2017 | 13,166 | 18,121 | ||
2016 and prior | 52,759 | 19,064 | ||
2015 and Prior | 55,661 | |||
Total | 86,390 | 119,643 | ||
Student Loan | Consumer Portfolio Segment | Loan delinquency 90 days or greater past due | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
2021 | 0 | |||
2020 | 943 | 460 | ||
2019 | 4,578 | 4,642 | ||
2018 | 8,247 | 9,396 | ||
2017 | 10,921 | 12,939 | ||
2016 and prior | 42,690 | 14,710 | ||
2015 and Prior | 38,555 | |||
Total | 67,379 | 80,702 | ||
Student Loan | Loans In-School/Grace/Deferment | Consumer Portfolio Segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
2021 | 330,417 | |||
2020 | 1,798,922 | 1,374,085 | ||
2019 | 1,255,241 | 1,330,175 | ||
2018 | 703,917 | 733,824 | ||
2017 | 489,599 | 508,478 | ||
2016 and prior | 815,578 | 327,763 | ||
2015 and Prior | 504,715 | |||
Total | 5,393,674 | 4,779,040 | ||
Student Loan | Loans In Forbearance | Consumer Portfolio Segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Total Private Education Loans in forbearance, 2021 | 1,186 | |||
Total Private Education Loans in forbearance, 2020 | 21,471 | 16,159 | ||
Total Private Education Loans in forbearance, 2019 | 89,409 | 92,677 | ||
Total Private Education Loans in forbearance, 2018 | 93,513 | 110,319 | ||
Total Private Education Loans in forbearance, 2017 | 103,807 | 118,946 | ||
Total Private Education Loans in forbearance, 2016 and Prior | 260,841 | 109,073 | ||
Total Private Education Loans in forbearance, 2015 and Prior | 198,302 | |||
Total Private Education Loans in forbearance | 570,227 | 645,476 | ||
Student Loan, Borrowers Who Did Not Return To School And Received Extenstion | Consumer Portfolio Segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Total Private Education Loans in repayment, 2021 | 482,000 | 609,000 | ||
Student Loan, Borrowers Who Did Not Return To School And Received Extenstion | Loans In-School/Grace/Deferment | Consumer Portfolio Segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
2021 | 273,000 | 401,000 | ||
Student Loan, Borrowers Who Did Not Return To School And Received Extenstion | Loans In Forbearance | Consumer Portfolio Segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Total Private Education Loans in forbearance, 2021 | $ 29,000 | $ 30,000 |
Allowance for Credit Losses -_6
Allowance for Credit Losses - Accrued Interest Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Receivables [Abstract] | ||
Total Interest Receivable | $ 1,248,475 | $ 1,168,895 |
90 Days and Greater Past Due | 3,695 | 4,354 |
Allowance for Uncollectible Interest | $ 4,405 | $ 4,467 |
Unfunded Loan Commitments (Deta
Unfunded Loan Commitments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Credit Loss [Abstract] | ||
Contractual obligation | $ 457,000 | |
Allowance | ||
Beginning balance | 110,044 | $ 2,481 |
Provision/New commitments - net | 40,197 | 49,561 |
Other provision items | (3,994) | 3,982 |
Transfer - funded loans | (126,880) | (142,075) |
Ending balance | 19,367 | 29,707 |
Unfunded Commitments | ||
Beginning balance | 1,673,018 | 1,910,603 |
Provision/New commitments - net | 843,161 | 834,946 |
Other provision items | 0 | 0 |
Transfer - funded loans | (2,058,726) | (2,295,742) |
Ending balance | 457,453 | 449,807 |
Cumulative Effect, Period Of Adoption, Adjustment | ||
Allowance | ||
Beginning balance | 0 | 115,758 |
Unfunded Commitments | ||
Beginning balance | 0 | 0 |
Cumulative Effect, Period Of Adoption, Adjusted Balance | ||
Allowance | ||
Beginning balance | 110,044 | 118,239 |
Unfunded Commitments | ||
Beginning balance | $ 1,673,018 | $ 1,910,603 |
Deposits - Summary of Total Dep
Deposits - Summary of Total Deposits (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Banking and Thrift, Other Disclosures [Abstract] | ||
Deposits - interest bearing | $ 22,801,323 | $ 22,664,899 |
Deposits - non-interest bearing | 1,820 | 1,140 |
Total deposits | $ 22,803,143 | $ 22,666,039 |
Deposits - Additional Informati
Deposits - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Banking and Thrift, Other Disclosures [Abstract] | |||
Deposits | $ 22,803,143 | $ 22,666,039 | |
Brokered deposits | 12,100,000 | 11,900,000 | |
Retail and other deposits | 10,700,000 | 10,800,000 | |
Stable interest-bearing deposits, total | 7,900,000 | 7,100,000 | |
Brokered deposit placement fee | 4,000 | $ 5,000 | |
Third party broker fees paid | 0 | $ 2,000 | |
Deposits exceeding FDIC insurance limits | 751,000 | 571,000 | |
Accrued interest on deposits | $ 61,000 | $ 50,000 |
Deposits - Interest Bearing Dep
Deposits - Interest Bearing Deposits (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Amount | ||
Money market | $ 10,951,595 | $ 10,159,657 |
Savings | 955,547 | 907,976 |
Certificates of deposit | 10,894,181 | 11,597,266 |
Deposits - interest bearing | $ 22,801,323 | $ 22,664,899 |
Qtr.-End Weighted Average Stated Rate | ||
Money market | 0.68% | 0.83% |
Savings | 0.42% | 0.55% |
Certificates of deposit | 1.24% | 1.34% |
Borrowings - Company Borrowings
Borrowings - Company Borrowings (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Short-Term | $ 0 | $ 0 |
Long-Term | 4,918,670 | 5,189,217 |
Total | 4,918,670 | 5,189,217 |
Unsecured borrowings | ||
Debt Instrument [Line Items] | ||
Short-Term | 0 | 0 |
Long-Term | 693,099 | 692,879 |
Total | 693,099 | 692,879 |
Secured borrowings | ||
Debt Instrument [Line Items] | ||
Short-Term | 0 | 0 |
Long-Term | 4,225,571 | 4,496,338 |
Total | 4,225,571 | 4,496,338 |
Secured borrowings | Private Education Loan securitization | ||
Debt Instrument [Line Items] | ||
Short-Term | 0 | 0 |
Long-Term | 4,225,571 | 4,496,338 |
Total | 4,225,571 | 4,496,338 |
Secured borrowings | Private Education Loan securitization | Fixed-rate | ||
Debt Instrument [Line Items] | ||
Short-Term | 0 | 0 |
Long-Term | 3,109,329 | 3,261,233 |
Total | 3,109,329 | 3,261,233 |
Secured borrowings | Private Education Loan securitization | Variable-rate | ||
Debt Instrument [Line Items] | ||
Short-Term | 0 | 0 |
Long-Term | 1,116,242 | 1,235,105 |
Total | 1,116,242 | 1,235,105 |
Secured borrowings | Secured Borrowing Facility | ||
Debt Instrument [Line Items] | ||
Short-Term | 0 | 0 |
Long-Term | 0 | 0 |
Total | $ 0 | $ 0 |
Borrowings - Additional Informa
Borrowings - Additional Information (Details) - USD ($) | Feb. 17, 2021 | Feb. 09, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Dec. 31, 2020 |
Line of Credit Facility [Line Items] | |||||
Short-term borrowings | $ 0 | $ 0 | |||
Vertical risk retention interest | 5.00% | 5.00% | 5.00% | ||
Unsecured offering issued | 1,343,000,000 | ||||
Uncommitted federal funds | $ 125,000,000 | ||||
Lendable value of collateral | 3,200,000,000 | 3,800,000,000 | |||
Student Loan | |||||
Line of Credit Facility [Line Items] | |||||
Private education loans sold | $ 2,500,000,000 | ||||
Additional net proceeds from sales of loans held for investment, capitalized interest | 130,000,000 | ||||
Gain on sale | $ 18,000,000 | ||||
Unsecured borrowings | |||||
Line of Credit Facility [Line Items] | |||||
Short-term borrowings | 0 | 0 | |||
Commercial Paper | ABCP borrowings | |||||
Line of Credit Facility [Line Items] | |||||
Private asset backed commercial paper education loan funding facility | $ 2,000,000,000 | ||||
Ownership interest percentage in residual interest in ABCP facility | 100.00% | ||||
Short-term borrowings | $ 0 | $ 0 |
Borrowings - Securitizations (D
Borrowings - Securitizations (Details) - USD ($) | 1 Months Ended | |||
Aug. 31, 2020 | Feb. 29, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | |
Securities Financing Transaction [Line Items] | ||||
Total Issued | $ 1,343,000,000 | |||
Total loan and accrued interest amount securitized at inception on-balance sheet term securitization | $ 1,463,230,000 | |||
2020-A | ||||
Securities Financing Transaction [Line Items] | ||||
Total Issued | $ 636,000,000 | |||
Basis spread on variable rate | 0.88% | |||
Weighted Average Life | 4 years 2 months 4 days | |||
2020-B | ||||
Securities Financing Transaction [Line Items] | ||||
Total Issued | $ 707,000,000 | |||
Basis spread on variable rate | 1.30% | |||
Weighted Average Life | 4 years 1 month 20 days | |||
Private Education Loan securitization | ||||
Securities Financing Transaction [Line Items] | ||||
Loans pledged as collateral | $ 1,290,000,000 | |||
Principal amount of collateral | 1,200,000,000 | |||
Capitalized interest | $ 86,000,000 |
Borrowings - Financing VIEs (De
Borrowings - Financing VIEs (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 |
Debt Outstanding | |||
Short-Term | $ 0 | $ 0 | |
Long-Term | 4,918,670 | 5,189,217 | |
Total | 4,918,670 | 5,189,217 | |
Carrying Amount of Assets Securing Debt Outstanding | |||
Restricted Cash | 164,708 | 154,417 | $ 189,439 |
Other Assets | 32,541 | 19,533 | |
Total assets | 30,628,005 | 30,770,423 | |
Variable Interest Entity, Primary Beneficiary | |||
Debt Outstanding | |||
Short-Term | 0 | 0 | |
Long-Term | 4,225,571 | 4,496,338 | |
Total | 4,225,571 | 4,496,338 | |
Carrying Amount of Assets Securing Debt Outstanding | |||
Loans | 5,343,243 | 5,661,123 | |
Restricted Cash | 164,708 | 154,417 | |
Other Assets | 358,445 | 357,403 | |
Total assets | 5,866,396 | 6,172,943 | |
Variable Interest Entity, Primary Beneficiary | Private Education Loan securitization | |||
Debt Outstanding | |||
Short-Term | 0 | 0 | |
Long-Term | 4,225,571 | 4,496,338 | |
Total | 4,225,571 | 4,496,338 | |
Carrying Amount of Assets Securing Debt Outstanding | |||
Loans | 5,343,243 | 5,661,123 | |
Restricted Cash | 164,708 | 154,417 | |
Other Assets | 355,949 | 356,967 | |
Total assets | 5,863,900 | 6,172,507 | |
Variable Interest Entity, Primary Beneficiary | Secured Borrowing Facility | |||
Debt Outstanding | |||
Short-Term | 0 | 0 | |
Long-Term | 0 | 0 | |
Total | 0 | 0 | |
Carrying Amount of Assets Securing Debt Outstanding | |||
Loans | 0 | 0 | |
Restricted Cash | 0 | 0 | |
Other Assets | 2,496 | 436 | |
Total assets | $ 2,496 | $ 436 |
Borrowings - Summary of Exposur
Borrowings - Summary of Exposure Related To Unconsolidated VIEs (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||||
Estimated Fair Value | $ 2,115,885 | $ 1,996,634 | ||
Total Exposure | 19,367 | 110,044 | $ 29,707 | $ 2,481 |
Private Education Loan securitization | Variable Interest Entity, Not Primary Beneficiary | ||||
Debt Instrument [Line Items] | ||||
Estimated Fair Value | 199,135 | 68,908 | ||
Equity Interests | 30,594 | 16,923 | ||
Total Exposure | $ 229,729 | $ 85,831 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Derivative [Line Items] | ||
Notional value | $ 8,600,000,000 | |
Net derivatives | 24,000,000 | $ 43,000,000 |
Estimated accumulated other comprehensive income to be reclassified in next 12 months | 20,000,000 | |
Cash collateral held relative to derivative exposure | 0 | 0 |
Cash collateral pledged | 24,000,000 | $ 43,000,000 |
CHICAGO MERCANTILE EXCHANGE | ||
Derivative [Line Items] | ||
Notional value | $ 8,200,000,000 | |
Percent of total notional derivative contracts | 95.60% | |
Amount of variation margin included as settlement | $ (157,000,000) | |
London Clearing House | ||
Derivative [Line Items] | ||
Notional value | $ 400,000,000 | |
Percent of total notional derivative contracts | 4.40% | |
Amount of variation margin included as settlement | $ 15,000,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Impact of Derivatives on Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Total net derivatives | $ 24,000 | $ 43,000 |
Interest rate swaps | ||
Derivatives, Fair Value [Line Items] | ||
Derivative instruments | 1,054 | 729 |
Derivative Liabilities | (451) | (287) |
Total net derivatives | 603 | 442 |
Interest rate swaps | Trading | ||
Derivatives, Fair Value [Line Items] | ||
Derivative instruments | 0 | 135 |
Derivative Liabilities | (451) | 0 |
Total net derivatives | (451) | 135 |
Interest rate swaps | Cash Flow | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivative instruments | 809 | 0 |
Derivative Liabilities | 0 | (287) |
Total net derivatives | 809 | (287) |
Interest rate swaps | Fair Value | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivative instruments | 245 | 594 |
Derivative Liabilities | 0 | 0 |
Total net derivatives | $ 245 | $ 594 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Offsetting Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities | ||
Cash collateral pledged | $ 24,000 | $ 43,000 |
Other Assets | ||
Other Assets | ||
Gross position | 1,054 | 729 |
Impact of master netting agreement | (451) | (176) |
Derivative values with impact of master netting agreements (as carried on balance sheet) | 603 | 553 |
Cash collateral pledged | 23,592 | 42,874 |
Net position | 24,195 | 43,427 |
Other Liabilities | ||
Other Liabilities | ||
Gross position | (451) | (287) |
Impact of master netting agreement | 451 | 176 |
Derivative values with impact of master netting agreements (as carried on balance sheet) | 0 | (111) |
Cash collateral pledged | 0 | 0 |
Net position | $ 0 | $ (111) |
Derivative Financial Instrume_6
Derivative Financial Instruments - Notional Values (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Notional values | $ 8,600,000 | |
Interest rate swaps | ||
Derivatives, Fair Value [Line Items] | ||
Notional values | 8,566,736 | $ 8,557,883 |
Interest rate swaps | Trading | ||
Derivatives, Fair Value [Line Items] | ||
Notional values | 2,393,364 | 2,693,364 |
Interest rate swaps | Cash Flow Hedges | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional values | 1,535,718 | 1,018,976 |
Interest rate swaps | Fair Value Hedges | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional values | $ 4,637,654 | $ 4,845,543 |
Derivative Financial Instrume_7
Derivative Financial Instruments - Schedule of Hedged Items Recorded in Statement of Financial Position (Details) - Deposits - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Carrying Amount of the Hedged Assets/(Liabilities) | $ (4,754,979) | $ (4,992,867) |
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | $ (122,959) | $ (154,235) |
Derivative Financial Instrume_8
Derivative Financial Instruments - Impact of Derivatives on Consolidated Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash Flow Hedges | ||
Interest expense | $ 105,044 | $ 174,817 |
Trading | ||
Total | 6,501 | 46,342 |
Designated as Hedging Instrument | ||
Fair Value Hedges | ||
Interest recognized on derivatives | 22,610 | 4,623 |
Hedged items recorded in interest expense | 31,275 | (143,248) |
Derivatives recorded in interest expense | (31,251) | 144,183 |
Trading | ||
Total | 22,634 | 5,558 |
Designated as Hedging Instrument | Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent | Reclassification out of Accumulated Other Comprehensive Income | ||
Cash Flow Hedges | ||
Interest expense | (5,269) | (1,528) |
Trading | ||
Trading | ||
Change in fair value of future interest payments recorded in earnings | (10,864) | 42,312 |
Total | $ (10,864) | $ 42,312 |
Derivative Financial Instrume_9
Derivative Financial Instruments - Impact of Derivatives on Consolidated Statement of Changes in Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Amount of gain (loss) recognized in other comprehensive income (loss) | $ 18,154 | $ (47,222) |
Less: amount of gain (loss) reclassified in interest expense | (5,269) | (1,528) |
Total change in other comprehensive income (loss) for unrealized gains (losses) on derivatives, before income tax (expense) benefit | $ 23,423 | $ (45,694) |
Stockholders' Equity - Common S
Stockholders' Equity - Common Stock Repurchased (Details) - USD ($) $ / shares in Units, $ in Millions | Jan. 28, 2021 | Mar. 11, 2020 | Mar. 10, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Equity [Abstract] | |||||
Common stock repurchased under repurchase program (in shares) | 13,000,000 | 45,000,000 | 45,000,000 | 48,702,830 | 47,736,847 |
Average purchase price per share (in usd per share) | $ 15.75 | $ 9.66 | |||
Shares repurchased related to employee stock-based compensation plans (in shares) | 1,059,980 | 1,105,119 | |||
Average purchase price per share (in usd per share) | $ 13.50 | $ 10.98 | |||
Common shares issued (in shares) | 2,826,387 | 2,837,562 | |||
Remaining authority under the share repurchase program | $ 734 | ||||
Common stock repurchased and cancelled (in shares) | 28,500,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) | Mar. 16, 2021 | Mar. 10, 2021 | Jan. 28, 2021 | Jan. 26, 2021 | Mar. 11, 2020 | Mar. 10, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Feb. 02, 2021 | Jan. 27, 2021 | Dec. 31, 2020 | Jan. 22, 2020 |
Class of Stock [Line Items] | ||||||||||||
Common stock dividend (in usd per share) | $ 0.03 | $ 0.03 | ||||||||||
Aggregate purchase price (not to exceed) | $ 600,000,000 | |||||||||||
Common stock repurchased (in shares) | 13,000,000 | 45,000,000 | 45,000,000 | 48,702,830 | 47,736,847 | |||||||
Common stock repurchased, amount | $ 525,000,000 | |||||||||||
Remaining authority under the share repurchase program | $ 734,000,000 | |||||||||||
Common stock, par value (in dollars per share) | $ 0.20 | $ 0.20 | ||||||||||
Average purchase price per share (in usd per share) | $ 13.50 | $ 10.98 | ||||||||||
Common stock repurchased | $ 550,790,000 | $ 558,167,000 | ||||||||||
Common stock repurchased and cancelled (in shares) | 28,500,000 | |||||||||||
Common Stock | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock repurchased (in shares) | 20,200,370 | 47,736,847 | ||||||||||
Tender Offer | Additional Paid-In Capital | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock purchase cancelled, common stock balance | $ 466,000,000 | |||||||||||
Tender Offer | Common Stock | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock purchase cancelled, common stock balance | $ 6,000,000 | |||||||||||
Common Stock | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock closing price (in usd per share) | $ 17.97 | |||||||||||
Common Stock | 2020 Share Repurchase Program | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock repurchased (in shares) | 58,000,000 | 4,000,000 | ||||||||||
Common stock repurchased, amount | $ 75,000,000 | |||||||||||
Treasury stock, additional shares received | 13,000,000 | |||||||||||
Average purchase price per share (in usd per share) | $ 9.01 | |||||||||||
Common Stock | 2021 Share Repurchase Program | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Aggregate purchase price (not to exceed) | $ 1,250,000,000 | |||||||||||
Common stock repurchased (in shares) | 31,000,000 | |||||||||||
Common stock repurchased, amount | $ 517,000,000 | |||||||||||
Remaining authority under the share repurchase program | $ 734,000,000 | |||||||||||
Common Stock | Tender Offer | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Aggregate purchase price (not to exceed) | $ 1,000,000,000 | |||||||||||
Common stock repurchased (in shares) | 28,500,000 | |||||||||||
Common stock, par value (in dollars per share) | $ 0.20 | |||||||||||
Average purchase price per share (in usd per share) | $ 16.50 | |||||||||||
Common stock repurchased | $ 472,000,000 | |||||||||||
Common Stock | Rule 10b5-1 Trading Plan | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock repurchased (in shares) | 6,800,000 | |||||||||||
Common stock repurchased, amount | $ 121,000,000 |
Earnings per Common Share (Deta
Earnings per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Net income | $ 641,207 | $ 362,173 |
Preferred stock dividends | 1,201 | 3,464 |
Net income attributable to SLM Corporation common stock | $ 640,006 | $ 358,709 |
Denominator: | ||
Weighted average shares used to compute basic EPS (in shares) | 361,042,000 | 409,786,000 |
Effect of dilutive securities: | ||
Dilutive effect of stock options, restricted stock and restricted stock units and Employee Stock Purchase Plan (ESPP) (in shares) | 5,198,000 | 2,969,000 |
Weighted average shares used to compute diluted EPS (in shares) | 366,240,000 | 412,755,000 |
Basic earnings per common share attributable to SLM Corporation (in dollars per share) | $ 1.77 | $ 0.88 |
Diluted earnings per common share attributable to SLM Corporation (in dollars per share) | $ 1.75 | $ 0.87 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,000,000 | 2,000,000 |
Fair Value Measurements - Valua
Fair Value Measurements - Valuation of Financial Instruments That are Marked-to-Market on Recurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Trading investments | $ 30,594 | $ 16,923 |
Estimated Fair Value | 2,115,885 | 1,996,634 |
Fair Value Measurements on a Recurring Basis | ||
Assets | ||
Trading investments | 30,594 | 16,923 |
Estimated Fair Value | 2,115,885 | 1,996,634 |
Derivative instruments | 1,054 | 729 |
Total earning assets | 2,147,533 | 2,014,286 |
Liabilities | ||
Derivative instruments | (451) | (287) |
Fair Value Measurements on a Recurring Basis | Level 1 | ||
Assets | ||
Trading investments | 0 | 0 |
Estimated Fair Value | 0 | 0 |
Derivative instruments | 0 | 0 |
Total earning assets | 0 | 0 |
Liabilities | ||
Derivative instruments | 0 | 0 |
Fair Value Measurements on a Recurring Basis | Level 2 | ||
Assets | ||
Trading investments | 0 | 0 |
Estimated Fair Value | 2,115,885 | 1,996,634 |
Derivative instruments | 1,054 | 729 |
Total earning assets | 2,116,939 | 1,997,363 |
Liabilities | ||
Derivative instruments | (451) | (287) |
Fair Value Measurements on a Recurring Basis | Level 3 | ||
Assets | ||
Trading investments | 30,594 | 16,923 |
Estimated Fair Value | 0 | 0 |
Derivative instruments | 0 | 0 |
Total earning assets | 30,594 | 16,923 |
Liabilities | ||
Derivative instruments | $ 0 | $ 0 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Values of Financial Assets and Liabilities, Including Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Earning assets | ||
Loans held for sale | $ 0 | $ 340,389 |
Trading investments | 30,594 | 16,923 |
Accrued interest receivable, difference | 108,633 | 140,511 |
Tax indemnification receivable | 169,655 | 374,706 |
Total earning assets, difference | 3,380,177 | 4,182,834 |
Interest-bearing liabilities | ||
Long-term borrowings, difference | (199,096) | (209,092) |
Total interest-bearing liabilities, difference | (408,148) | (479,976) |
Excess of net asset fair value over carrying value | 2,972,029 | 3,702,858 |
Money-market and savings accounts | ||
Interest-bearing liabilities | ||
Deposits, difference | (54,706) | (68,927) |
Certificates of deposit | ||
Interest-bearing liabilities | ||
Deposits, difference | (154,346) | (201,957) |
Fair Value | ||
Earning assets | ||
Loans held for sale | 0 | 3,226,029 |
Cash and cash equivalents | 6,207,001 | 4,455,292 |
Trading investments | 30,594 | 16,923 |
Available-for-sale investments | 2,115,885 | 1,996,634 |
Accrued interest receivable | 1,373,593 | 1,527,816 |
Tax indemnification receivable | 15,678 | 18,492 |
Derivative instruments | 1,054 | 729 |
Total earning assets | 33,383,636 | 34,126,992 |
Interest-bearing liabilities | ||
Long-term borrowings | 5,117,766 | 5,398,309 |
Accrued interest payable | 79,231 | 60,272 |
Derivative instruments | 451 | 287 |
Total interest-bearing liabilities | 28,207,823 | 28,394,651 |
Fair Value | Money-market and savings accounts | ||
Interest-bearing liabilities | ||
Deposits | 11,961,848 | 11,136,560 |
Fair Value | Certificates of deposit | ||
Interest-bearing liabilities | ||
Deposits | 11,048,527 | 11,799,223 |
Carrying Value | ||
Earning assets | ||
Loans held for sale | 0 | 2,885,640 |
Cash and cash equivalents | 6,207,001 | 4,455,292 |
Trading investments | 30,594 | 16,923 |
Available-for-sale investments | 2,115,885 | 1,996,634 |
Accrued interest receivable | 1,264,960 | 1,387,305 |
Tax indemnification receivable | 15,678 | 18,492 |
Derivative instruments | 1,054 | 729 |
Total earning assets | 30,003,459 | 29,944,158 |
Interest-bearing liabilities | ||
Long-term borrowings | 4,918,670 | 5,189,217 |
Accrued interest payable | 79,231 | 60,272 |
Derivative instruments | 451 | 287 |
Total interest-bearing liabilities | 27,799,675 | 27,914,675 |
Carrying Value | Money-market and savings accounts | ||
Interest-bearing liabilities | ||
Deposits | 11,907,142 | 11,067,633 |
Carrying Value | Certificates of deposit | ||
Interest-bearing liabilities | ||
Deposits | 10,894,181 | 11,597,266 |
Private Education Loans | ||
Earning assets | ||
Loans held for investment, net, difference | 3,256,987 | 3,687,203 |
Private Education Loans | Fair Value | ||
Earning assets | ||
Loans held for investment, net | 22,889,920 | 22,124,171 |
Private Education Loans | Carrying Value | ||
Earning assets | ||
Loans held for investment, net | 19,632,933 | 18,436,968 |
FFELP Loans | ||
Earning assets | ||
Loans held for investment, net, difference | 13,279 | 13,449 |
FFELP Loans | Fair Value | ||
Earning assets | ||
Loans held for investment, net | 738,579 | 748,657 |
FFELP Loans | Carrying Value | ||
Earning assets | ||
Loans held for investment, net | 725,300 | 735,208 |
Credit Cards | ||
Earning assets | ||
Loans held for investment, net, difference | 1,278 | 1,282 |
Credit Cards | Fair Value | ||
Earning assets | ||
Loans held for investment, net | 11,332 | 12,249 |
Credit Cards | Carrying Value | ||
Earning assets | ||
Loans held for investment, net | $ 10,054 | $ 10,967 |
Regulatory Capital - Additional
Regulatory Capital - Additional Information (Details) | Jan. 01, 2020USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||||
Allowance for credit losses on loans and leases | $ 1,179,021,000 | $ 1,673,324,000 | $ 1,361,723,000 | $ 441,912,000 | |
Ending balance | 19,367,000 | 29,707,000 | $ 110,044,000 | $ 2,481,000 | |
Dividends | $ 1,000,000,000 | $ 541,000,000 | |||
Accounting Standards Update 2016-13 | |||||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||||
Period of deferment | 2 | ||||
Amount deferred | 25.00% | ||||
Allowance for credit losses on loans and leases | $ 1,100,000,000 | ||||
Ending balance | 116,000,000 | ||||
Deferred tax assets | 306,000,000 | ||||
Reduction to retained earnings | $ 953,000,000 |
Regulatory Capital - U.S. Basel
Regulatory Capital - U.S. Basel III Regulatory Requirements (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Actual Amount | ||
Common Equity Tier 1 Capital (to Risk-Weighted Assets) | $ 3,164,962 | $ 3,579,005 |
Tier 1 Capital (to Risk-Weighted Assets) | 3,164,962 | 3,579,005 |
Total Capital (to Risk-Weighted Assets) | 3,230,743 | 3,849,820 |
Tier 1 Capital (to Average Assets) | $ 3,164,962 | $ 3,579,005 |
Actual Ratio | ||
Common Equity Tier 1 Capital (to Risk-Weighted Assets) | 13.50% | 14.00% |
Tier 1 Capital (to Risk-Weighted Assets) | 0.135 | 0.140 |
Total Capital (to Risk-Weighted Assets) | 0.138 | 0.150 |
Tier 1 Capital (to Average Assets) | 0.100 | 0.113 |
Advanced Approach | ||
U.S. Basel III Regulatory Requirements, Amount | ||
Common Equity Tier 1 Capital (to Risk-Weighted Assets) | $ 1,637,155 | $ 1,794,780 |
Tier 1 Capital (to Risk-Weighted Assets) | 1,987,974 | 2,179,375 |
Total Capital (to Risk-Weighted Assets) | 2,455,732 | 2,692,169 |
Tier 1 Capital (to Average Assets) | $ 1,271,568 | $ 1,264,424 |
U.S. Basel III Regulatory Requirements, Ratio | ||
Common Equity Tier 1 Capital (to Risk-Weighted Assets) | 7.00% | 7.00% |
Tier 1 Capital (to Risk-Weighted Assets) | 0.085 | 0.085 |
Total Capital (to Risk-Weighted Assets) | 0.105 | 0.105 |
Tier 1 Capital (to Average Assets) | 0.040 | 0.040 |
Commitments, Contingencies an_2
Commitments, Contingencies and Guarantees (Details) $ in Millions | Mar. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual obligation | $ 457 |
Other liabilities reserve | $ 19 |