What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2021-02-25 compared with 2020-02-28 · 32 added, 22 removed, 63 unchanged (46% of the section changed)

3 unchanged sentences

As of January 31, 2021, there were 363,671,446 shares of our common stock outstanding and 264 holders of record.

We paid quarterly cash dividends on our common stock of $0.03 per share for each quarter of 2019.

For the years ended December 31, 2018 and 2017, we did not pay dividends on our common stock.

We paid quarterly cash dividends on our common stock of $0.03 per share for each quarter of 2020 and 2019.

For the year ended December 31, 2018, we did not pay dividends on our common stock.

Common stock dividend declarations are subject to determination by, and the discretion of, our Board of Directors.

2 unchanged sentences

The following table provides information relating to our purchase of shares of our common stock in the three months ended December 31, 2020.

(In thousands, except per share data)

(In thousands, except per share data) Total Number

Purchased (1)

14 unchanged sentences

(1) The total number of shares purchased includes:

(i) shares purchased under the stock repurchase program discussed herein, and (ii) shares of our common stock tendered to us to satisfy the exercise price in connection with cashless exercises of stock options, and tax withholding obligations in connection with exercises of stock options and vesting of restricted stock, restricted stock units and performance stock units.

(2) The 2019 Share Repurchase Program permits us to repurchase shares of our common stock up to an aggregate repurchase price not to exceed $200 million.

(i) shares purchased under the stock repurchase programs discussed herein, and (ii) shares of our common stock tendered to us to satisfy the exercise price in connection with cashless exercises of stock options, and tax withholding obligations in connection with exercises of stock options and vesting of restricted stock, restricted stock units and performance stock units.

(2) On January 23, 2019, our Board of Directors authorized us to repurchase shares of our common stock up to an aggregate repurchase price not to exceed $200 million under the 2019 Share Repurchase Program.

As of February 2020, we had utilized all capacity under the 2019 Share Repurchase Program.

On January 22, 2020, our Board of Directors authorized us to repurchase shares of our common stock up to an aggregate repurchase price not to exceed $600 million under the 2020 Share Repurchase Program.

The 2020 Share Repurchase Program expires on January 21, 2022.

In the first quarter of 2020, we paid $525 million under an ASR agreement and received an initial delivery of 44.9 million shares.

See Note 13, “Stockholders’ Equity” to our consolidated financial statements for further discussion.

The closing price of our common stock on Nasdaq on December 31, 2020 was $12.39.

The 2019 Share Repurchase Program expires on January 22, 2021 and permits us to repurchase from time to time shares of our common stock up to an aggregate repurchase price not to exceed $200 million.

Under the 2019 Share Repurchase Program, we repurchased 17 million shares of common stock for $167 million for the year ended December 31, 2019.

We had $33 million of remaining capacity under the 2019 Share Repurchase Program as of December 31, 2019.

The 2019 Share Repurchase Program expired on January 22, 2021 and permitted us to repurchase from time to time shares of our common stock up to an aggregate repurchase price not to exceed $200 million.

We utilized all capacity under the 2019 Share Repurchase Program, having repurchased 17 million and 3 million shares of common stock for $167 million and $33 million in the years ended December 31, 2019 and 2020, respectively.

The 2020 Share Repurchase Program expires on January 21, 2022 and permits us to repurchase shares of common stock from time to time up to an aggregate repurchase price not to exceed $600 million.

The timing and volume of any repurchases will be subject to market conditions, and there can be no guarantee that the Company will repurchase up to the limit of the programs or at all.

Repurchases may occur from time to time and through a variety of methods, including open market repurchases, repurchases effected through Rule 10b5-1 trading plans, negotiated block purchases, accelerated share repurchase programs, tender offers or other similar transactions.

Under the authority of the 2020 Share Repurchase Program, on March 10, 2020, we entered into an 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 44.9 million shares.

The final total actual number of shares of common stock delivered to us pursuant to the forward agreement was based upon the Rule 10b-18 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 are accounted for as equity transactions and are included in treasury stock when the shares are received, at which time there is 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.

For additional information, see Notes to Consolidated Financial Statements, Note 25, “Subsequent Events.”

On January 27, 2021, we announced 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.

On February 2, 2021, we announced 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 (the “Securities”) or such lesser aggregate purchase price of Securities as are properly tendered and not properly withdrawn, at a single per-Security price not greater than $15.00 nor less than $13.10 per share to the seller in cash, less any applicable withholding taxes and without interest.

The Tender Offer may be amended from time to time, and will expire, upon the terms and conditions described in the relevant Tender Offer materials filed with the SEC.

The results of the Tender Offer will be reflected in the Company’s financial results for the first fiscal quarter of 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 will be subject to market conditions, and there can be no guarantee that we will repurchase up to the limit of the program or at all.

In addition to any repurchases that we may make under the share repurchase programs, we expect to repurchase common stock acquired as a result of taxes withheld in connection with award exercises and vesting under our employee stock-based compensation plans.

1 unchanged sentence

The following graph compares the five-year cumulative total returns of SLM Corporation, the S&P Supercomposite Consumer Finance Sub-Industry Index, and the S&P 400 Regional Bank Sub-Industry Index.

This graph assumes $100 was invested in the stock or the relevant index on December 31, 2014, and also assumes the reinvestment of dividends through December 31, 2019 , including the Company’s distribution to its shareholders of one share of Navient Corporation common stock for every share of SLM Corporation on April 30, 2014.

For the purpose of this graph, the Navient Corporation distribution is treated as a non-taxable cash dividend of $16.56 that would have been reinvested in SLM Corporation common stock at the close of business on April 30, 2014.

This graph assumes $100 was invested in the stock or the relevant index on December 31, 2015, and also assumes the reinvestment of dividends through December 31, 2020.

Five-Year Cumulative Total Stockholder Return

11 unchanged sentences

“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

2020 2019 2018 2017 2016

Operating Data:

2 unchanged sentences

Total revenue 1,811 1,672 1,361 1,126 960

Net income $ 881 $ 578 $ 487 $ 289 $ 250

Basic earnings per common share attributable to SLM Corporation $ 2.27 $ 1.31 $ 1.08 $ 0.63 $ 0.54

1 unchanged sentence

Dividends per common share attributable to SLM Corporation common shareholders (1)

$ 0.12 $ 0.12 $ — $ — $ —

Return on common stockholders’ equity 45 % 21 % 20 % 14 % 14 %

3 unchanged sentences

Average equity/average assets 7.23 10.56 11.22 11.92 13.40

Non-GAAP operating efficiency ratio (2)

Balance Sheet Data:

Total education loan portfolio, net

Total Personal Loans, net

Total Credit Cards, net

Total education loans held for investment portfolio, net $ 19,172 $ 23,680 $ 21,143 $ 18,174 $ 15,125

Total Personal Loans held for investment, net — 984 1,128 394 13

Total Credit Cards held for investment, net 11 4 — — —

Total assets 30,770 32,686 26,638 21,780 18,533

Total deposits 22,666 24,284 18,943 15,505 13,436

2 unchanged sentences

Book value per common share 6.16 6.91 5.90 4.80 4.15

(1) In 2019, we initiated a new policy to pay a regular, quarterly cash dividend on our common stock, beginning in the first quarter of 2019.

(1) Common stock dividend declarations are subject to determination by, and the discretion of, our Board of Directors.

1 unchanged sentence

We did not pay common stock dividends in fiscal years 2018, 2017 and 2016.

(2) Our operating efficiency ratio is a non-GAAP measure because we adjust (a) the total non-interest expense numerator by deducting restructuring and other reorganization expenses, and (b) the net revenue denominator (which otherwise would consist of net interest income, before provisions for credit losses, and non-interest income) by excluding any gains and losses on sales of loans and securities, net and the net impact of derivative accounting as defined in the Core Earnings adjustments to GAAP table set forth in Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations — Key Financial Measures — Core Earnings” of this Annual Report on Form 10-K.

We believe doing so provides useful information to investors because it is a measure used by our management team to monitor our effectiveness in managing operating expenses.

Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate our ratio.

Accordingly, our non-GAAP operating efficiency ratio may not be comparable to similar measures used by other companies.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity