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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
 
(Mark One)
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2021
or
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission File Number: 001-13251
 
SLM Corporation
(Exact name of registrant as specified in its charter)
 
Delaware 52-2013874
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
300 Continental Drive Newark, Delaware 19713
(Address of principal executive offices) (Zip Code)
(302) 451-0200
(Registrant’s telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common stock, par value $.20 per share SLM The NASDAQ Global Select Market
Floating Rate Non-Cumulative Preferred Stock, Series B, par value $.20 per share SLMBP The NASDAQ Global Select Market
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  þ    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  þ    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer   Accelerated filer
Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  No þ 
As of June 30, 2021, there were 305,807,223 shares of common stock outstanding.






SLM CORPORATION

CONSOLIDATED FINANCIAL STATEMENTS
INDEX



2


SLM CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
(Unaudited)
 
June 30, December 31,
2021 2020
Assets
Cash and cash equivalents $ 4,497,310  $ 4,455,292 
Investments:
Trading investments at fair value (cost of $29,049 and $12,551)
35,908  16,923 
Available-for-sale investments at fair value (cost of $2,070,350 and $1,986,957, respectively)
2,072,309  1,996,634 
Other investments 141,400  80,794 
Total investments 2,249,617  2,094,351 
Loans held for investment (net of allowance for losses of $1,160,244 and $1,361,723, respectively)
20,115,144  19,183,143 
Loans held for sale —  2,885,640 
Restricted cash 163,955  154,417 
Other interest-earning assets 18,115  42,874 
Accrued interest receivable 1,323,448  1,387,305 
Premises and equipment, net 153,969  154,670 
Income taxes receivable, net 349,107  374,706 
Tax indemnification receivable 12,842  18,492 
Other assets 41,668  19,533 
Total assets $ 28,925,175  $ 30,770,423 
Liabilities
Deposits $ 21,124,376  $ 22,666,039 
Short-term borrowings 199,379  — 
Long-term borrowings 4,989,060  5,189,217 
Other liabilities 308,982  352,332 
Total liabilities 26,621,797  28,207,588 
Commitments and contingencies
Equity
Preferred stock, par value $0.20 per share, 20 million shares authorized:
Series B: 2.5 million and 2.5 million shares issued, respectively, at stated value of $100 per share
251,070  251,070 
Common stock, par value $0.20 per share, 1.125 billion shares authorized: 431.5 million and 456.7 million shares issued, respectively
86,302  91,346 
Additional paid-in capital 1,058,698  1,331,247 
Accumulated other comprehensive loss (net of tax benefit of ($6,906) and ($10,908), respectively)
(21,640) (34,200)
Retained earnings 2,480,672  1,722,365 
Total SLM Corporation stockholders’ equity before treasury stock 3,855,102  3,361,828 
Less: Common stock held in treasury at cost: 125.7 million and 81.4 million shares, respectively
(1,551,724) (798,993)
Total equity 2,303,378  2,562,835 
Total liabilities and equity $ 28,925,175  $ 30,770,423 

See accompanying notes to consolidated financial statements.
3


SLM CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
 
Three Months Ended Six Months Ended
  June 30, June 30,
  2021 2020 2021 2020
Interest income:
Loans $ 430,099  $ 480,170  $ 861,903  $ 1,035,447 
Investments 3,168  3,096  5,896  5,759 
Cash and cash equivalents 1,423  1,529  3,049  18,522 
Total interest income 434,690  484,795  870,848  1,059,728 
Interest expense:
Deposits 57,256  100,246  123,854  235,358 
Interest expense on short-term borrowings 5,700  3,399  8,902  7,616 
Interest expense on long-term borrowings 32,950  32,375  68,194  67,863 
Total interest expense 95,906  136,020  200,950  310,837 
Net interest income 338,784  348,775  669,898  748,891 
Less: provisions for credit losses 69,677  351,887  (156,090) 413,145 
Net interest income (loss) after provisions for credit losses 269,107  (3,112) 825,988  335,746 
Non-interest income:
Gains (losses) on sales of loans, net 3,679  (369) 402,790  238,566 
Gains on derivatives and hedging activities, net 89  3,751  117  49,423 
Other income 48,580  25,412  62,868  32,899 
Total non-interest income 52,348  28,794  465,775  320,888 
Non-interest expenses:
Operating expenses:
Compensation and benefits 62,616  72,448  134,197  156,670 
FDIC assessment fees 5,925  7,163  11,113  16,053 
Other operating expenses 59,469  61,946  107,199  116,132 
Total operating expenses 128,010  141,557  252,509  288,855 
Restructuring expenses 70  —  1,147  — 
Total non-interest expenses 128,080  141,557  253,656  288,855 
Income (loss) before income tax expense (benefit) 193,375  (115,875) 1,038,107  367,779 
Income tax expense (benefit) 53,174  (30,664) 256,699  90,817 
Net income (loss) 140,201  (85,211) 781,408  276,962 
Preferred stock dividends 1,192  2,478  2,393  5,942 
Net income (loss) attributable to SLM Corporation common stock $ 139,009  $ (87,689) $ 779,015  $ 271,020 
Basic earnings (loss) per common share attributable to SLM Corporation $ 0.45  $ (0.23) $ 2.32  $ 0.69 
Average common shares outstanding 312,183  375,009  336,478  392,397 
Diluted earnings (loss) per common share attributable to SLM Corporation $ 0.44  $ (0.23) $ 2.28  $ 0.69 
Average common and common equivalent shares outstanding 317,119  375,009  341,544  395,191 
Declared dividends per common share attributable to SLM Corporation $ 0.03  $ 0.06  $ 0.06  $ 0.09 

See accompanying notes to consolidated financial statements.
4


SLM CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
(Unaudited)
 
Three Months Ended Six Months Ended
  June 30, June 30,
  2021 2020 2021 2020
Net income (loss) $ 140,201  $ (85,211) $ 781,408  $ 276,962 
Other comprehensive income (loss):
Unrealized gains (losses) on investments 2,354  1,211  (7,717) 6,014 
Unrealized gains (losses) on cash flow hedges 856  (2,343) 24,279  (48,037)
Total unrealized gains (losses) 3,210  (1,132) 16,562  (42,023)
Income tax (expense) benefit (773) 335  (4,002) 10,319 
Other comprehensive income (loss), net of tax (expense) benefit 2,437  (797) 12,560  (31,704)
Total comprehensive income (loss) $ 142,638  $ (86,008) $ 793,968  $ 245,258 

















See accompanying notes to consolidated financial statements.
5



SLM CORPORATION
CONSOLIDATED STATEMENT S OF CHANGES IN EQUITY
(In thousands, except share and per share amounts)
(Unaudited)

Common Stock Shares
Preferred Stock Shares Issued Treasury Outstanding Preferred Stock Common Stock Additional Paid-In Capital Accumulated
Other
Comprehensive
Loss
Retained Earnings Treasury Stock Total Equity
Balance at March 31, 2020 4,000,000  456,437,488  (81,348,528) 375,088,960  $ 400,000  $ 91,288  $ 1,226,886  $ (43,274) $ 1,243,722  $ (798,039) $ 2,120,583 
Net loss —  —  —  —  —  —  —  —  (85,211) —  (85,211)
Other comprehensive loss, net of tax —  —  —  —  —  —  —  (797) —  —  (797)
Total comprehensive loss —  —  —  —  —  —  —  —  —  —  (86,008)
Cash dividends declared:
Common stock ($0.06 per share)
—  —  —  —  —  —  —  —  (22,749) —  (22,749)
Preferred Stock, Series B ($0.62 per share)
—  —  —  —  —  —  —  —  (2,478) —  (2,478)
Dividend equivalent units related to employee stock-based compensation plans —  —  —  —  —  —  15  —  (15) —  — 
Issuance of common shares —  147,735  —  147,735  —  29  (30) —  —  —  (1)
Stock-based compensation expense —  —  —  —  —  —  7,579  —  —  —  7,579 
Shares repurchased related to employee stock-based compensation plans —  —  (908) (908) —  —  —  —  —  (7) (7)
Balance at June 30, 2020 4,000,000  456,585,223  (81,349,436) 375,235,787  $ 400,000  $ 91,317  $ 1,234,450  $ (44,071) $ 1,133,269  $ (798,046) $ 2,016,919 










See accompanying notes to consolidated financial statements.
6


SLM CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except share and per share amounts)
(Unaudited)


Common Stock Shares
Preferred Stock Shares Issued Treasury Outstanding Preferred Stock Common Stock Additional Paid-In Capital Accumulated
Other
Comprehensive
Income (Loss)
Retained Earnings Treasury Stock Total Equity
Balance at March 31, 2021 2,510,696  431,053,178  (102,701,602) 328,351,576  $ 251,070  $ 86,211  $ 1,052,904  $ (24,077) $ 2,350,986  $ (1,108,630) $ 2,608,464 
Net income —  —  —  —  —  —  —  —  140,201  —  140,201 
Other comprehensive income, net of tax —  —  —  —  —  —  —  2,437  —  —  2,437 
Total comprehensive income —  —  —  —  —  —  —  —  —  —  142,638 
Cash dividends declared:
Common stock ($0.03 per share)
—  —  —  —  —  —  —  —  (9,264) —  (9,264)
Preferred Stock, Series B ($0.47 per share)
—  —  —  —  —  —  —  —  (1,192) —  (1,192)
Dividend equivalent units related to employee stock-based compensation plans —  —  —  —  —  —  59  —  (59) —  — 
Issuance of common shares —  454,920  —  454,920  —  91  (131) —  —  —  (40)
Stock-based compensation expense —  —  —  —  —  —  6,444  —  —  —  6,444 
Fees related to first-quarter 2021 common stock tender offer —  —  —  —  —  —  (578) —  —  —  (578)
Common stock repurchased —  —  (22,806,841) (22,806,841) —  —  —  —  —  (439,477) (439,477)
Shares repurchased related to employee stock-based compensation plans —  —  (192,432) (192,432) —  —  —  —  —  (3,617) (3,617)
Balance at June 30, 2021 2,510,696  431,508,098  (125,700,875) 305,807,223  $ 251,070  $ 86,302  $ 1,058,698  $ (21,640) $ 2,480,672  $ (1,551,724) $ 2,303,378 




See accompanying notes to consolidated financial statements.



7


SLM CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except share and per share amounts)
(Unaudited)

Common Stock Shares
Preferred Stock Shares Issued Treasury Outstanding Preferred Stock Common Stock Additional Paid-In Capital Accumulated
Other
Comprehensive
Loss
Retained Earnings Treasury Stock Total Equity
Balance at December 31, 2019 4,000,000  453,599,926  (32,506,562) 421,093,364  $ 400,000  $ 90,720  $ 1,307,630  $ (12,367) $ 1,850,512  $ (324,659) $ 3,311,836 
Cumulative adjustment for the adoption of ASU No. 2016-13 (CECL) —  —  —  —  —  —  —  —  (952,639) —  (952,639)
Balance at January 1, 2020 4,000,000  453,599,926  (32,506,562) 421,093,364  400,000  90,720  1,307,630  (12,367) 897,873  (324,659) 2,359,197 
Net income —  —  —  —  —  —  —  —  276,962  —  276,962 
Other comprehensive loss, net of tax —  —  —  —  —  —  —  (31,704) —  —  (31,704)
Total comprehensive income —  —  —  —  —  —  —  —  —  —  245,258 
Cash dividends declared:
Common stock ($0.09 per share)
—  —  —  —  —  —  —  —  (35,344) —  (35,344)
Preferred Stock, Series B ($1.49 per share)
—  —  —  —  —  —  —  —  (5,942) —  (5,942)
Dividend equivalent units related to employee stock-based compensation plans —  —  —  —  —  —  270  —  (280) —  (10)
Issuance of common shares —  2,985,297  2,985,297  —  597  2,284  —  —  —  2,881 
Stock-based compensation expense —  —  —  —  —  —  21,189  —  —  —  21,189 
Common stock repurchased —  —  (47,736,847) (47,736,847) —  —  (96,923) —  —  (461,244) (558,167)
Shares repurchased related to employee stock-based compensation plans —  —  (1,106,027) (1,106,027) —  —  —  —  —  (12,143) (12,143)
Balance at June 30, 2020 4,000,000  456,585,223  (81,349,436) 375,235,787  $ 400,000  $ 91,317  $ 1,234,450  $ (44,071) $ 1,133,269  $ (798,046) $ 2,016,919 








See accompanying notes to consolidated financial statements.

8



SLM CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In thousands, except share and per share amounts)
(Unaudited)

Common Stock Shares
Preferred Stock Shares Issued Treasury Outstanding Preferred Stock Common Stock Additional Paid-In Capital Accumulated
Other
Comprehensive
Income (Loss)
Retained Earnings Treasury Stock Total Equity
Balance at December 31, 2020 2,510,696  456,729,251  (81,441,252) 375,287,999  $ 251,070  $ 91,346  $ 1,331,247  $ (34,200) $ 1,722,365  $ (798,993) $ 2,562,835 
Net income —  —  —  —  —  —  —  —  781,408  —  781,408 
Other comprehensive income, net of tax —  —  —  —  —  —  —  12,560  —  —  12,560 
Total comprehensive income —  —  —  —  —  —  —  —  —  —  793,968 
Cash dividends declared:
Common stock ($0.06 per share)
—  —  —  —  —  —  —  —  (20,170) —  (20,170)
Preferred Stock, Series B ($0.95 per share)
—  —  —  —  —  —  —  —  (2,393) —  (2,393)
Dividend equivalent units related to employee stock-based compensation plans —  —  —  —  —  —  522  —  (538) —  (16)
Issuance of common shares —  3,281,307  3,281,307  —  656  1,365  —  —  —  2,021 
Stock-based compensation expense —  —  —  —  —  —  17,568  —  —  —  17,568 
Common stock repurchased and cancelled —  (28,502,460) —  (28,502,460) —  (5,700) (466,688) —  —  —  (472,388)
Common stock repurchased —  —  (43,007,211) (43,007,211) —  —  174,684  —  —  (734,801) (560,117)
Shares repurchased related to employee stock-based compensation plans —  —  (1,252,412) (1,252,412) —  —  —  —  —  (17,930) (17,930)
Balance at June 30, 2021 2,510,696  431,508,098  (125,700,875) 305,807,223  $ 251,070  $ 86,302  $ 1,058,698  $ (21,640) $ 2,480,672  $ (1,551,724) $ 2,303,378 











See accompanying notes to consolidated financial statements.

9


SLM CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

  Six Months Ended
June 30,
  2021 2020
Operating activities
Net income $ 781,408  $ 276,962 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Provisions for credit losses (156,090) 413,145 
Income tax expense 256,699  90,817 
Amortization of brokered deposit placement fee 8,194  10,128 
Amortization of Secured Borrowing Facility upfront fee 1,486  1,346 
Amortization of deferred loan origination costs and loan premium/(discounts), net 7,983  16,220 
Net amortization of discount on investments 4,079  2,551 
Unrealized gain on investments —  (1,710)
Reduction (increase) in tax indemnification receivable 5,649  (567)
Depreciation of premises and equipment 7,545  7,677 
Stock-based compensation expense 17,568  21,009 
Unrealized (gains) losses on derivatives and hedging activities, net 17,809  (34,752)
Gains on sales of loans, net (402,790) (238,566)
Gain on sale of Upromise subsidiary, net —  (11,331)
Other adjustments to net income, net (31,210) 3,812 
Changes in operating assets and liabilities:
Increase in accrued interest receivable (369,343) (464,291)
Increase in non-marketable securities (8,611) — 
Decrease (increase) in other interest-earning assets 24,759  (22,338)
Increase in other assets (96,253) (62,497)
Decrease in income taxes payable, net (232,124) (23,597)
Decrease in accrued interest payable (8,292) (11,912)
Decrease in Upromise member accounts due to sale —  (193,840)
Decrease in other liabilities (8,399) 159,589 
Total adjustments (961,341) (339,107)
Total net cash used in operating activities (179,933) (62,145)
Investing activities
Loans acquired and originated (2,628,056) (2,824,850)
Net proceeds from sales of loans held for investment 3,436,085  3,283,039 
Proceeds from claim payments 9,275  17,308 
Net decrease in loans held for investment 1,892,800  2,035,613 
Purchases of available-for-sale securities (505,004) (1,556,084)
Proceeds from sales and maturities of available-for-sale securities 582,090  105,073 
Proceeds from sale of Upromise subsidiary, net —  16,922 
Total net cash provided by investing activities 2,787,190  1,077,021 
Financing activities
Brokered deposit placement fee (713) (3,305)
Net decrease in certificates of deposit (2,312,940) (1,059,731)
Net increase in other deposits 816,013  220,047 
Borrowings collateralized by loans in securitization trusts - issued 529,253  633,305 
Borrowings collateralized by loans in securitization trusts - repaid (534,282) (541,365)
Issuance costs for unsecured debt offering (325) — 
Repayment of borrowings under Secured Borrowing Facility —  (289,230)
Fees paid on Secured Borrowing Facility (2,846) (3,251)
Common stock dividends paid (20,170) (23,844)
Preferred stock dividends paid (2,393) (5,942)
10


Common stock repurchased (1,027,298) (558,167)
Total net cash used in financing activities (2,555,701) (1,631,483)
Net increase (decrease) in cash, cash equivalents and restricted cash 51,556  (616,607)
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 $ 4,661,265  $ 5,104,153 
Cash disbursements made for:
Interest $ 192,939  $ 304,119 
Income taxes paid $ 232,285  $ 27,661 
Income taxes refunded $ (1,049) $ (4,016)
Reconciliation of the Consolidated Statements of Cash Flows to the Consolidated Balance Sheets:
Cash and cash equivalents $ 4,497,310  $ 4,988,961 
Restricted cash 163,955  115,192 
Total cash, cash equivalents and restricted cash $ 4,661,265  $ 5,104,153 
See accompanying notes to consolidated financial statements.
11





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, unless otherwise noted)

1. 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 and six months ended June 30, 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.
Reclassifications
Certain reclassifications have been made to the balances for the three and six months ended June 30, 2020, to be consistent with classifications adopted in 2021, which had no effect on net income, total assets or total liabilities.
12





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
2. Investments
Trading Investments
We periodically 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 June 30, 2021 and December 31, 2020, we had $36 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:
June 30, 2021
Amortized Cost
Allowance for credit losses(1)
Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value
Available-for-sale:
Mortgage-backed securities $ 373,019  $ —  $ 2,892  $ (3,762) $ 372,149 
Utah Housing Corporation bonds 8,375  —  107  —  8,482 
U.S. government-sponsored enterprises and Treasuries 1,471,892  —  2,003  (264) 1,473,631 
Other securities 217,064  —  1,309  (326) 218,047 
Total $ 2,070,350  $ —  $ 6,311  $ (4,352) $ 2,072,309 
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.

13





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
2. Investments (Continued)
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
Unrealized
Losses
Estimated
Fair Value
Gross
Unrealized
Losses
Estimated
Fair Value
Gross
Unrealized
Losses
Estimated
Fair Value
As of June 30, 2021:
Mortgage-backed securities $ (3,762) $ 251,811  $ —  $ —  $ (3,762) $ 251,811 
Utah Housing Corporation bonds —  —  —  —  —  — 
U.S. government-sponsored enterprises and Treasuries (264) 316,890  —  —  (264) 316,890 
Other securities (325) 75,773  (1) 2,557  (326) 78,330 
Total $ (4,351) $ 644,474  $ (1) $ 2,557  $ (4,352) $ 647,031 
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 June 30, 2021 and December 31, 2020, 41 of 182 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 Moody’s Investors Service or AA+ by Standard and Poor’s. The decline in value from December 31, 2020 to June 30, 2021 was driven by the current interest rate
14





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
2. Investments (Continued)
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.
We periodically 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 June 30, 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 $ 31,146  $ 31,239 
2022 992,519  993,634 
2023 198,664  198,857 
2024 50,000  49,990 
2026 199,563  199,910 
2038 75  81 
2039 1,192  1,304 
2042 4,041  4,068 
2043 6,655  6,923 
2044 8,542  8,883 
2045 7,934  8,202 
2046 12,528  12,796 
2047 16,253  16,533 
2048 4,114  4,269 
2049 28,654  29,706 
2050 163,165  160,817 
2051 128,241  127,049 
2053 156,676  157,060 
2054 60,388  60,988 
Total $ 2,070,350  $ 2,072,309 

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 $825 million and $815 million par value of securities pledged to this borrowing facility at June 30, 2021 and December 31, 2020, respectively, as discussed further in Notes to Consolidated Financial Statements, Note 8, “Borrowings.”


15





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
2. Investments (Continued)
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. Changes in market value are recorded through earnings. Because these are non-marketable securities, we use observable price changes of identical or similar securities of the same issuer in determining any changes in the value of the securities. In the second quarter of 2021, we funded an additional investment, as part of a larger equity raise, in an issuer whose equity securities we purchased in the past. We used the valuation associated with the more recent equity raise to adjust the valuation of our previous investments, and, as a result, recorded a gain of $35 million on our earlier equity securities investments. This gain was recorded in “other income” in the consolidated statements of income for the three and six months ended June 30, 2021. As of June 30, 2021 and December 31, 2020, our total investment in these securities was $69 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 and tax benefits from net operating losses on the underlying properties. Total carrying value of the LIHTC investments was $71 million at June 30, 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 $33 million at June 30, 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 June 30, 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.


3. 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 SOFR, the Secured Overnight Financing Rate. As of June 30, 2021 and December 31, 2020, 54 percent and 55 percent, respectively, of all of our Private Education Loans were indexed to LIBOR or SOFR. 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
16





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
3. Loans Held for Investment (Continued)
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 six months of 2021, we recognized a $403 million gain from the sale of approximately $3.19 billion of our Private Education Loans, including $2.99 billion of principal and $195 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:
June 30, December 31,
2021 2020
Private Education Loans:
Fixed-rate $ 9,442,904  $ 8,950,216 
Variable-rate 11,034,853  10,779,121 
Total Private Education Loans, gross 20,477,757  19,729,337 
Deferred origination costs and unamortized premium/(discount) 65,872  63,475 
Allowance for credit losses (1,154,540) (1,355,844)
Total Private Education Loans, net 19,389,089  18,436,968 
FFELP Loans 716,958  737,593 
Deferred origination costs and unamortized premium/(discount) 1,913  1,993 
Allowance for credit losses (4,262) (4,378)
Total FFELP Loans, net 714,609  735,208 
Credit Cards (fixed-rate) 12,784  12,238 
Deferred origination costs and unamortized premium/(discount) 104  230 
Allowance for credit losses (1,442) (1,501)
Total Credit Cards, net 11,446  10,967 
Loans held for investment, net $ 20,115,144  $ 19,183,143 
 
The estimated weighted average life of education loans in our portfolio was approximately 4.5 years and 5.4 years at June 30, 2021 and December 31, 2020, respectively.
17





SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
3. Loans Held for Investment (Continued)
The average balance and the respective weighted average interest rates of loans in our portfolio are summarized as follows:
Three Months Ended
June 30,
2021 2020
Average Balance Weighted Average Interest Rate Average Balance Weighted Average Interest Rate
Private Education Loans $ 20,654,285  8.22  % $ 21,590,905  8.33  %
FFELP Loans 723,391  3.41  761,469  3.82 
Personal Loans —  —  836,342  12.54 
Credit Cards 11,694  6.64  9,364  (9.34)
Total portfolio $ 21,389,370  $ 23,198,080 



Six Months Ended
June 30,
2021 2020
Average Balance Weighted Average Interest Rate Average Balance Weighted Average Interest Rate
Private Education Loans $ 20,818,476  8.22  % $ 22,546,874  8.60  %
FFELP Loans 728,810  3.41  768,897  4.06 
Personal Loans —  —  905,007  12.31 
Credit Cards 11,767  3.71  7,325  (7.67)
Total portfolio $ 21,559,053  $ 24,228,103 


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 in the case of disaster forbearance, where the accrued interest is not capitalized when the loan re-enters payment status).
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
3. Loans Held for Investment (Continued)
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 almost all instances, we require one or more payments before granting forbearance to delinquent borrowers.
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. Beginning in June 2021, we stopped granting disaster forbearance in response to the COVID-19 pandemic. As borrowers in the various delinquency buckets exit disaster forbearance and begin to enter repayment, we expect to see elevated levels of losses in the latter half of 2021. We expect that, left unabated, this deterioration in forbearance, delinquency, and default rates may persist until such time as the economy and employment return to pre-pandemic levels.
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, under previous credit administration practices we granted forbearance to borrowers without requiring any period of prior principal and interest payments, meaning that, if a borrower satisfied all eligibility requirements, forbearance increments could 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 would not apply, however, to forbearances granted during the first six months following a borrower’s grace period and would 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
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
3. Loans Held for Investment (Continued)
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 could 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 credit administration practices changes by the end of 2021. However, we may modify or delay the contemplated practices 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 June 30, 2021 and December 31, 2020, 9.0 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 previous 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., Graduated Repayment Plan (“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 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.
As discussed above, we will continue to monitor our credit administration practices and may modify them further from time to time based upon performance, industry conventions, and/or regulatory feedback.

4. Loans Held for Sale
We had no loans held for sale and $2.9 billion in loans held for sale at June 30, 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. During the second quarter of 2021, we sold $27 million of
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
our Private Education Loans, including $25 million of principal and $2 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 $403 million in the first six months of 2021. For additional information, see Notes to Consolidated Financial Statements, Note 3, “Loans Held for Investment,” and Note 8, “Borrowings.”


5. 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
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
5. Allowance for Credit Losses (Continued)
  Allowance for Credit Losses
  Three Months Ended June 30, 2021
FFELP
Loans
Private Education
Loans
Credit Cards Total
Allowance for Credit Losses
Beginning balance $ 4,318  $ 1,173,375  $ 1,328  $ 1,179,021 
Transfer from unfunded commitment liability(1)
—  24,556  —  24,556 
Provisions:
Provision for current period (2) 1,014  182  1,194 
Loan sale reduction to provision —  (1,477) —  (1,477)
Total provisions(2)
(2) (463) 182  (283)
Net charge-offs:
Charge-offs (54) (49,900) (74) (50,028)
Recoveries —  6,972  6,978 
Net charge-offs (54) (42,928) (68) (43,050)
Ending Balance $ 4,262  $ 1,154,540  $ 1,442  $ 1,160,244 
Allowance:
Ending balance: individually evaluated for impairment $ —  $ 80,495  $ —  $ 80,495 
Ending balance: collectively evaluated for impairment $ 4,262  $ 1,074,045  $ 1,442  $ 1,079,749 
Loans:
Ending balance: individually evaluated for impairment $ —  $ 1,192,743  $ —  $ 1,192,743 
Ending balance: collectively evaluated for impairment $ 716,958  $ 19,285,014  $ 12,784  $ 20,014,756 
Net charge-offs as a percentage of average loans in repayment (annualized)(3)
0.04  % 1.16  % 2.29  %
Allowance as a percentage of the ending total loan balance 0.59  % 5.64  % 11.28  %
Allowance as a percentage of the ending loans in repayment(3)
0.78  % 7.79  % 11.28  %
Allowance coverage of net charge-offs (annualized) 19.73  6.72  5.30 
Ending total loans, gross $ 716,958  $ 20,477,757  $ 12,784 
Average loans in repayment(3)
$ 546,306  $ 14,743,360  $ 11,855 
Ending loans in repayment(3)
$ 548,488  $ 14,825,375  $ 12,784 
____________
(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.
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
5. Allowance for Credit Losses (Continued)
Consolidated Statements of Income
Provisions for Credit Losses Reconciliation
Three Months Ended 
 June 30, 2021
Private Education Loan provisions for credit losses:
Provisions for loan losses $ (463)
Provisions for unfunded loan commitments 69,960 
Total Private Education Loan provisions for credit losses 69,497 
Other impacts to the provisions for credit losses:
FFELP Loans (2)
Credit Cards 182 
Total 180 
Provisions for credit losses reported in consolidated statements of income $ 69,677 

(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.


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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
5. Allowance for Credit Losses (Continued)

  Allowance for Credit Losses
  Three Months Ended June 30, 2020
FFELP 
Loans
Private Education
Loans
Personal
Loans
Credit Cards Total
Allowance for Credit Losses
Beginning balance $ 4,296  $ 1,515,781  $ 152,673  $ 574  $ 1,673,324 
Transfer from unfunded commitment liability(1)
—  37,010  —  —  37,010 
Provisions:
Provision for current period 173  234,015  23,929  509  258,626 
Loan sale reduction to provision —  —  —  —  — 
Total provisions(2)
173  234,015  23,929  509  258,626 
Net charge-offs:
Charge-offs (84) (31,779) (14,601) (41) (46,505)
Recoveries —  5,532  1,336  —  6,868 
Net charge-offs (84) (26,247) (13,265) (41) (39,637)
Ending Balance $ 4,385  $ 1,760,559  $ 163,337  $ 1,042  $ 1,929,323 
Allowance:
Ending balance: individually evaluated for impairment $ —  $ 160,234  $ —  $ —  $ 160,234 
Ending balance: collectively evaluated for impairment $ 4,385  $ 1,600,325  $ 163,337  $ 1,042  $ 1,769,089 
Loans:
Ending balance: individually evaluated for impairment $ —  $ 1,520,240  $ —  $ —  $ 1,520,240 
Ending balance: collectively evaluated for impairment $ 754,340  $ 19,965,225  $ 772,086  $ 10,706  $ 21,502,357 
Net charge-offs as a percentage of average loans in repayment (annualized)(3)
0.07  % 0.75  % 6.87  % 1.77  %
Allowance as a percentage of the ending total loan balance 0.58  % 8.19  % 21.16  % 9.73  %
Allowance as a percentage of the ending loans in repayment(3)
0.97  % 12.13  % 22.46  % 9.73  %
Allowance coverage of net charge-offs (annualized) 13.05  16.77  3.08  6.35 
Ending total loans, gross $ 754,340  $ 21,485,465  $ 772,086  $ 10,706 
Average loans in repayment(3)
$ 513,418  $ 14,011,841  $ 772,137  $ 9,265 
Ending loans in repayment(3)
$ 452,617  $ 14,512,723  $ 727,214  $ 10,706 
____________
(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.
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
5. Allowance for Credit Losses (Continued)
Consolidated Statements of Income
Provisions for Credit Losses Reconciliation
Three Months Ended 
 June 30, 2020
Private Education Loan provisions for credit losses:
Provisions for loan losses $ 234,015 
Provisions for unfunded loan commitments 93,261 
Total Private Education Loan provisions for credit losses 327,276 
Other impacts to the provisions for credit losses:
Personal Loans 23,929 
FFELP Loans 173 
Credit Cards 509 
Total 24,611 
Provisions for credit losses reported in consolidated statements of income $ 351,887 

(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.



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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, unless otherwise noted)
5. Allowance for Credit Losses (Continued)

  Allowance for Credit Losses