What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2023-02-23 compared with 2022-02-24 · 634 added, 553 removed, 2306 unchanged (34% of the section changed)

54 unchanged sentences

4.5 Description of SLM Corporation’s Common Stock (incorporated by reference to Exhibit 4.3 to the Company’s Annual Report on Form 10-K filed on February 28, 2020).

4.6 Description of SLM Corporation’s Floating-Rate Non-Cumulative Preferred Stock, Series B (incorporated by reference to Exhibit 4.4 to the Com pany’s Annual Report on Form 10-K filed on February 28, 2020).

4.6 Description of SLM Corporation’s Floating-Rate Non-Cumulative Preferred Stock, Series B (incorporated by reference to Exhibit 4.4 to the Company’s Annual Report on Form 10-K filed on February 28, 2020).

4.7 Third Supplemental Indenture dated as of November 1, 2021 between SLM Corporation and Deutsche Bank National Trust Company, as trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on November 1, 2021).

8 unchanged sentences

10.8† Form of SLM Corporation 2012 Omnibus Incentive Plan, Restricted Stock Unit Term Sheet - 2016 (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016).

110 SLM CORPORATION — 2021 Form 10-K

10.9† Form of SLM Corporation 2012 Omnibus Incentive Plan, Performance Stock Unit Term Sheet - 2016 (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016).

108 SLM CORPORATION — 2022 Form 10-K

10.10† Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement 2015 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2015).

23 unchanged sentences

10.29† Form of SLM Corporation 2009-2012 Incentive Plan Stock Option Agreement, Net Settled, Time Vested Options - 2011 (incorporated by reference to Exhibit 10.50 of the Company’s Annual Report on Form 10-K filed on February 28, 2011).

2021 Form 10-K — SLM CORPORATION 111

10.30† Form of SLM Corporation 2009-2012 Incentive Plan Restricted Stock and Restricted Stock Unit Term Sheet, Time Vested - 2011 (incorporated by reference to Exhibit 10.51 of the Company’s Annual Report on Form 10-K filed on February 28, 2011).

10.31† Form of SLM Corporation 2009-2012 Incentive Plan, Performance Stock Unit Term Sheet - 2012 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on May 4, 2012).

2022 Form 10-K — SLM CORPORATION 109

10.32† Form of SLM Corporation 2009-2012 Incentive Plan, Bonus Restricted Stock Unit Term Sheet - 2012 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on May 4, 2012).

21 unchanged sentences

10.51† Amendment to Sallie Mae 401(k) Savings Plan (Effective as of January 1, 2019) (incorporated by reference to Exhibit 10.51 of the Company’s Annual Report on Form 10-K filed on February 28, 2020).

112 SLM CORPORATION — 2021 Form 10-K

10.52† Amendment to Sallie Mae 401(k) Savings Plan (Effective as of March 5, 2019) (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019).

1 unchanged sentence

10.54 Amended and Restated Loan Servicing and Administration Agreement between Sallie Mae Bank and Navient Solutions, Inc., dated as of April 30, 2014 (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K filed on May 2, 2014).

110 SLM CORPORATION — 2022 Form 10-K

10.55† Form of SLM Corporation 2012 Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (Three-Year Restriction), 2016 Management Incentive Plan Award (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 19, 2017).

20 unchanged sentences

Quinlan and the Company effective April 19, 2020 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2020).

2021 Form 10-K — SLM CORPORATION 113

10.74† Jonathan W.

5 unchanged sentences

10.78† Form of SLM Corporation 2012 Omnibus Incentive Plan, 2021 Performance Stock Unit Term Sheet (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 21, 2021).

2022 Form 10-K — SLM CORPORATION 111

10.79† Form of SLM Corporation 2012 Omnibus Incentive Plan, 2021 Stock Option Award Agreement (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 21, 2021).

1 unchanged sentence

10.81† SLM Corporation 2021 Omnibus Incentive Plan (incorporated herein by reference to Exhibit 99.1 of the Company’s Registration Statement on Form S-8 filed on June 9, 2021).

10.82† Form of SLM Corporation 2021 Omnibus Incentive Plan, 2022 Restricted Stock Unit Term Sheet (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 27, 2022).

10.83† Form of SLM Corporation 2021 Omnibus Incentive Plan, 2022 Performance Stock Unit Term Sheet (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 27, 2022).

10.84† Form of SLM Corporation 2021 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement – 2022 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 27, 2022).

10.85† Offer Letter between Kerri Palmer and the Company dated January 7, 2021 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on July 27, 2022).

21.1* List of Subsidiaries.

33 unchanged sentences

Mary Carter Warren Franke Chair of the Board of Directors February 23, 2023

SCOTT BLACKLEY

Scott Blackley Director February 23, 2023

Child Director February 23, 2023

4 unchanged sentences

Ted Manvitz Director February 23, 2023

2022 Form 10-K — SLM CORPORATION 113

/S/ JIM MATHESON

Jim Matheson Director February 23, 2023

2021 Form 10-K — SLM CORPORATION 115

Puleo Director February 24, 2022

/S/ SAMUEL T.

16 unchanged sentences

Notes to Consolidated Financial Statements

2021 Form 10-K — SLM CORPORATION F-1

F-1 SLM CORPORATION — 2022 Form 10-K

Report of Independent Registered Public Accounting Firm

2 unchanged sentences

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of SLM Corporation and subsidiaries (the Company) as of December 31, 2021 and December 31, 2020, the related consolidated statements of income, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and December 31, 2020, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2021, in conformity with U.S.

We have audited the accompanying consolidated balance sheets of SLM Corporation and subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of income, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2022, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2022, in conformity with U.S.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 24, 2022 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for the recognition and measurement of credit losses as of January 1, 2020 due to the adoption of ASC Topic 326, Financial Instruments - Credit Losses .

Basis for Opinion

9 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

F-2 SLM CORPORATION — 2021 Form 10-K

Critical Audit Matter

3 unchanged sentences

Assessment of the Allowance for Credit Losses related to Private Education Loans Evaluated on a Collective Basis

As discussed in Notes 2 and 7 to the consolidated financial statements, the Company’s total allowance for credit losses as of December 31, 2021 was $1,165 million, of which $1,159 million related to the Company’s allowance for credit losses on private education loans evaluated on a collective basis (the December 31, 2021 ACL).

As discussed in Notes 2 and 7 to the consolidated financial statements, the Company’s total allowance for credit losses as of December 31, 2022 was $1,357 million, of which $1,354 million related to the

2022 Form 10-K — SLM CORPORATION F- 2

Company’s allowance for credit losses on private education loans evaluated on a collective basis (the Collective ACL).

For all loans carried at amortized cost, upon loan origination, the Company is required to measure the allowance for credit losses based on the estimate of all current expected credit losses over the remaining contractual term of the loans.

In determining the lifetime expected credit losses on the private education loan portfolio, the Company uses a discounted cash flow model and a prepayment model.

This method requires the Company to project future principal and interest cash flows on the loans in this portfolio.

The Company estimated the future expected cash flows following a vintage-based model that considers life of loan loss expectations, prepayments (both voluntary and involuntary), defaults, recoveries, and any other adjustments deemed necessary, to determine the adequacy of the allowance for credit losses.

In determining the loss rates used for the vintage-based approach, the Company starts with historical loss rates, stratifies the loans within each vintage, and then adjusts the loss rates based upon exogenous factors over a reasonable and supportable forecast period.

In determining the lifetime expected credit losses on the private education loan portfolio, the Company applies a discounted cash flow method that incorporates a probability of default model and a prepayment model.

This method requires the Company to project future principal and interest cash flows on the loans in this portfolio following a vintage-based methodology that considers life of loan loss expectations, prepayments, defaults, recoveries, and any other adjustments deemed necessary to determine the adequacy of the allowance for credit losses.

In estimating current expected credit losses, the Company uses a combination of expected economic scenarios, which are weighted based upon the current economic conditions and the Company’s view of the risks of alternate outcomes.

In determining the loss rates used for the vintage-based approach, the Company uses the probability of default model which starts with historical loss rates, stratifies the loans within each vintage, and then adjusts the loss rates based upon economic factors forecasted over a reasonable and supportable forecast period.

At the end of the reasonable and supportable forecast period, the forecast is immediately reverted to historical averages.

The cash flows are then discounted at the loan’s effective interest rate to calculate the present value of those cash flows.

In addition to this modeling approach, the Company also takes certain qualitative factors, including but not limited to, changes in lending policies and procedures, including changes in underwriting standards and collections, charge-off and recovery practices not already included in the analysis, and the effect of other external factors such as legal and regulatory requirements on the level of estimated current expected credit losses into consideration when calculating the December 31, 2021 ACL.

We identified the assessment of the December 31, 2021 ACL as a critical audit matter.

The Company also takes certain qualitative factors into consideration when calculating the Collective ACL, which could result in management overlays.

We identified the assessment of the Collective ACL as a critical audit matter.

A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment due to significant measurement uncertainty.

Specifically, the assessment of the ACL methodology encompassed the evaluation of the development and mathematical accuracy of the discounted cash flow model and prepayment model and the models’ significant factors and assumptions, including (1) the economic scenarios, (2) probabilities assigned to each economic scenario weighting, (3) the reasonable and supportable forecast periods, (4) the immediate reversion assumption after the reasonable and supportable forecast period, (5) prepayment rates derived from the prepayment model, and (6) the qualitative factors.

The assessment also included an evaluation of the conceptual soundness and performance of the discounted cash flow model.

Specifically, the assessment of the Collective ACL methodology encompassed the evaluation of the conceptual soundness and performance of the probability of default and prepayment models, including their significant assumptions.

Such significant assumptions included (1) economic factors, (2) loss rates derived from the probability of default model, and (3) prepayment rates derived from the prepayment model.

The assessment also encompassed the conceptual soundness of the methods and significant assumptions used to determine certain individual management overlays.

In addition, auditor judgement was required to evaluate the sufficiency of audit evidence obtained.

The following are the primary procedures we performed to address the critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s measurement of the ACL estimates, including controls over the:

• development of the ACL methodology

• the prepayment model

• the discounted cash flow model

2021 Form 10-K — SLM CORPORATION F-3

• performance monitoring of the discounted cash flow and prepayment models for the December 31, 2021 ACL

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s measurement of the Collective ACL estimate, including controls over the:

• development of the Collective ACL methodology

• development of the probability of default model

• continued use and appropriateness of the prepayment model

• performance monitoring of the probability of default and prepayment models

• determination and measurement of the significant assumptions used in the models

• development of the qualitative factors

• calculation of the ACL estimate

• analysis of the ACL results, trends, and ratios.

We evaluated the Company’s process to develop the ACL estimates by testing certain sources of data, factors, and assumptions that the Company used, and considered the relevance and reliability of such data, factors, and assumptions.

• development of the individual management overlay methods and assumptions

• analysis of the Collective ACL results, trends, and ratios.

We evaluated the Company’s process to develop the Collective ACL estimate by testing certain sources of data, factors, and assumptions that the Company used, and considered the relevance and reliability of such data, factors, and assumptions.

In addition, we involved credit risk professionals with specialized skills and knowledge, who assisted in:

• evaluating the Company’s ACL methodology for compliance with U.S.

F-3 SLM CORPORATION — 2022 Form 10-K

• evaluating the Company’s Collective ACL methodology for compliance with U.S.

generally accepted accounting principles

• evaluating judgments made by the Company relative to the development and performance testing of the discounted cash flow and prepayment models by comparing them to the relevant Company-specific metrics and trends

• assessing the conceptual soundness and performance testing of the discounted cash flow and prepayment models by inspecting the model documentation to determine whether the models are suitable for their intended use

• evaluating the selection of the economic forecasted scenarios and underlying assumptions by comparing them to the Company’s business environment and relevant industry practices

• assessing the economic scenarios through comparison to publicly available forecasts and the probabilities assigned to each weighting

• testing the reasonable and supportable forecast periods to evaluate the length of each period by comparing to specific portfolio risk characteristics and trends

• evaluating the methodology used to develop the qualitative factors and the effect of those factors on the ACL compared with relevant credit risk factors and consistency with credit trends and identified limitations of the underlying quantitative discounted cash flow model

• testing the mathematical accuracy of certain computations of the estimate.

We also assessed the sufficiency of the audit evidence obtained related to the December 31, 2021 ACL by evaluating the cumulative results of the audit procedures and potential bias in the accounting estimates.

• evaluating judgments made by the Company relative to the development of the probability of default model and performance testing of the probability of default and prepayment models by comparing them to the relevant Company-specific metrics and trends

• assessing the conceptual soundness and performance testing of the probability of default and prepayment models by inspecting the model documentation to determine whether the models are suitable for their intended use

• evaluating the selection of the economic factors used to adjust loss rates over the reasonable and supportable forecast period by comparing them to the Company’s business environment and relevant industry practices

• evaluating the conceptual soundness of the methods and assumptions used to develop the individual management overlays and their impact on the Collective ACL compared with relevant credit risk factors and consistency with credit trends and identified limitations of the underlying probability of default and prepayment models

We also assessed the sufficiency of the audit evidence obtained related to the Collective ACL by evaluating the cumulative results of the audit procedures and potential bias in the accounting estimates.

We have served as the Company’s auditor since 2013.

1 unchanged sentence

February 23, 2023

F-4 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 4

Report of Independent Registered Public Accounting Firm

18 unchanged sentences

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

F-5 SLM CORPORATION — 2022 Form 10-K

expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

2021 Form 10-K — SLM CORPORATION F-5

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

2 unchanged sentences

February 23, 2023

F-6 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 6

CONSOLIDATED BALANCE SHEETS

15 unchanged sentences

Premises and equipment, net 140,728 150,516

Goodwill and acquired intangible assets, net 118,273 —

Income taxes receivable, net 380,058 239,578

24 unchanged sentences

See accompanying notes to consolidated financial statements.

2021 Form 10-K — SLM CORPORATION F-7

F-7 SLM CORPORATION — 2022 Form 10-K

CONSOLIDATED STATEMENTS OF INCOME

16 unchanged sentences

Gains on sales of loans, net 327,750 548,315 238,315

Gains on derivatives and hedging activities, net 144 49,544 17,825

Gains (losses) on securities, net ( 60,267 ) 39,096 4,372

Gains (losses) on derivatives and hedging activities, net ( 5 ) 144 49,544

Other income 67,160 44,894 39,218

6 unchanged sentences

Total operating expenses 551,462 518,653 538,088

Acquired intangible assets amortization expense 7,779 — —

Restructuring expenses — 1,255 26,215

11 unchanged sentences

See accompanying notes to consolidated financial statements.

F-8 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 8

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

10 unchanged sentences

See accompanying notes to consolidated financial statements.

2021 Form 10-K — SLM CORPORATION F-9

F-9 SLM CORPORATION — 2022 Form 10-K

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

2 unchanged sentences

Comprehensive

Income (Loss) Retained Earnings Treasury Stock Total Equity

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 — — — — — — — — 880,690 — 880,690

1 unchanged sentence

Total comprehensive income — — — — — — — — — — 858,857

Cash dividends:

Cash dividends declared:

Common Stock ($ 0.12 per share)

2 unchanged sentences

— — — — — — — — ( 9,734 ) — ( 9,734 )

Repurchase of Preferred Stock, series B ( 1,489,304 ) — — — ( 148,930 ) — 80,875 — — — ( 68,055 )

Dividend equivalent units related to employee stock-based compensation plans — — — — — — 271 — ( 281 ) — ( 10 )

5 unchanged sentences

See accompanying notes to consolidated financial statements.

F-10 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 10

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

2 unchanged sentences

Comprehensive

Loss Retained Earnings Treasury Stock Total Equity

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

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 — — — — — — — — 1,160,513 — 1,160,513

Other comprehensive loss, net of tax — — — — — — — ( 21,833 ) — — ( 21,833 )

Other comprehensive income, net of tax — — — — — — — 16,303 — — 16,303

Total comprehensive income — — — — — — — — — — 1,176,816

4 unchanged sentences

— — — — — — — — ( 4,736 ) — ( 4,736 )

Repurchase of Preferred Stock, series B ( 1,489,304 ) — — — ( 148,930 ) — 80,875 — — — ( 68,055 )

Dividend equivalent units related to employee stock-based compensation plans — — — — — — 530 — ( 546 ) — ( 16 )

1 unchanged sentence

Stock-based compensation expense — — — — — — 30,649 — — — 30,649

Common stock repurchased and cancelled — ( 28,502,460 ) — ( 28,502,460 ) — ( 5,700 ) ( 466,860 ) — — — ( 472,560 )

Common stock repurchased — — ( 70,246,445 ) ( 70,246,445 ) — — 174,684 — — ( 1,242,267 ) ( 1,067,583 )

2 unchanged sentences

See accompanying notes to consolidated financial statements.

2021 Form 10-K — SLM CORPORATION F-11

F-11 SLM CORPORATION — 2022 Form 10-K

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

2 unchanged sentences

Comprehensive

Income (Loss) Retained Earnings Treasury Stock Total Equity

Loss Retained Earnings Treasury Stock Total Equity

Balance at December 31, 2021 2,510,696 432,013,372 ( 153,056,639 ) 278,956,733 $ 251,070 $ 86,403 $ 1,074,384 $ ( 17,897 ) $ 2,817,134 $ ( 2,061,383 ) $ 2,149,711

Net income — — — — — — — — 469,014 — 469,014

Other comprehensive income, net of tax — — — — — — — 16,303 — — 16,303

Other comprehensive loss, net of tax — — — — — — — ( 75,973 ) — — ( 75,973 )

Total comprehensive income — — — — — — — — — — 393,041

4 unchanged sentences

— — — — — — — — ( 9,029 ) — ( 9,029 )

Dividend equivalent units related to employee stock-based compensation plans — — — — — — 530 — ( 546 ) — ( 16 )

Issuance of common shares — 3,107,768 3,107,768 — 622 618 — ( 807 ) — 433

Stock-based compensation expense — — — — — — 34,070 — 289 — 34,359

Common stock repurchased and cancelled — ( 28,502,460 ) — ( 28,502,460 ) — ( 5,700 ) ( 466,860 ) — — — ( 472,560 )

Common stock repurchased — — ( 40,253,548 ) ( 40,253,548 ) — — — — — ( 707,742 ) ( 707,742 )

2 unchanged sentences

See accompanying notes to consolidated financial statements.

F-12 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 12

CONSOLIDATED STATEMENTS OF CASH FLOWS

12 unchanged sentences

Depreciation of premises and equipment 17,331 16,043 15,066

Acquired intangible assets amortization expense 7,779 — —

Stock-based compensation expense 34,461 30,649 36,464

1 unchanged sentence

Gains on sale of loans, net ( 327,750 ) ( 548,315 ) ( 238,315 )

(Gains) losses on securities, net 60,267 ( 39,096 ) ( 4,372 )

Acquisition transaction costs, net 2,603 — —

Gain on sale of Upromise subsidiary, net — — ( 11,331 )

2 unchanged sentences

Increase in accrued interest receivable ( 819,958 ) ( 743,757 ) ( 876,703 )

Increase in trading investments ( 5,117 ) — —

Increase in non-marketable securities ( 2,050 ) ( 9,969 ) ( 839 )

Decrease (increase) in other interest-earning assets 33,219 9,690 ( 25,407 )

(Increase) decrease in other interest-earning assets ( 1,507 ) 33,219 9,690

Increase in other assets ( 23,472 ) ( 123,268 ) ( 50,454 )

Increase (decrease) in income tax payable, net ( 15,063 ) 72,191 ( 45,611 )

(Decrease) increase in accrued interest payable ( 13,672 ) ( 14,602 ) 13,817

Increase (decrease) in accrued interest payable 24,986 ( 13,672 ) ( 14,602 )

Decrease in Upromise member accounts due to sale — — ( 193,840 )

Increase in other liabilities 2,801 80,785 5,386

Increase (decrease) in other liabilities ( 6,473 ) 2,801 80,785

Total adjustments ( 464,022 ) ( 1,210,035 ) ( 1,063,359 )

Total net cash used in operating activities ( 49,522 ) ( 182,669 ) ( 15,641 )

Total net cash provided by (used in) operating activities 4,992 ( 49,522 ) ( 182,669 )

Investing activities

5 unchanged sentences

Proceeds from sales and maturities of available-for-sale securities 960,015 865,766 654,515

Purchase of subsidiary, net of cash acquired ( 127,654 ) — —

Proceeds for sale of Upromise subsidiary, net — — 16,922

Total net cash provided by (used in) investing activities 2,604,673 947,330 ( 2,306,714 )

Total net cash provided by investing activities 1,077,392 2,604,673 947,330

Financing activities

Brokered deposit placement fee ( 11,170 ) ( 12,565 ) ( 4,810 )

Net (decrease) increase in certificates of deposit ( 2,130,728 ) ( 2,428,094 ) 4,349,741

Net increase (decrease) in certificates of deposit 130,109 ( 2,130,728 ) ( 2,428,094 )

Net increase in other deposits 570,147 393,306 704,382

2 unchanged sentences

Borrowings collateralized by loans in securitization trusts - repaid ( 1,278,183 ) ( 1,143,738 ) ( 1,003,327 )

Borrowings under Secured Borrowing Facility — — 297,800

Repayment of borrowings under Secured Borrowing Facility — — ( 289,230 )

Fees paid - Secured Borrowing Facility ( 2,833 ) ( 2,846 ) ( 3,256 )

F-13 SLM CORPORATION — 2022 Form 10-K

Issuance costs for unsecured debt offering ( 375 ) ( 1,540 ) ( 1,309 )

1 unchanged sentence

Unsecured debt repaid — ( 202,784 ) —

2021 Form 10-K — SLM CORPORATION F-13

Preferred stock dividends paid ( 9,029 ) ( 4,736 ) ( 9,734 )

2 unchanged sentences

Common stock repurchased ( 713,197 ) ( 1,530,683 ) ( 558,167 )

Net cash (used in) provided by financing activities ( 2,619,516 ) ( 1,875,712 ) 5,361,220

Net (decrease) increase in cash, cash equivalents and restricted cash ( 64,365 ) ( 1,111,051 ) 3,038,865

Net cash used in financing activities ( 854,892 ) ( 2,619,516 ) ( 1,875,712 )

Net increase (decrease) in cash, cash equivalents and restricted cash 227,492 ( 64,365 ) ( 1,111,051 )

Cash, cash equivalents and restricted cash at beginning of year 4,545,344 4,609,709 5,720,760

9 unchanged sentences

See accompanying notes to consolidated financial statements.

F-14 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 14

Organization and Business

SLM Corporation (“Sallie Mae,” “SLM,” the “Company,” “we,” “our,” or “us”) is a holding company that operates through a number of subsidiaries and is the premier brand for college and continuous education.

SLM Corporation (“Sallie Mae,” “SLM,” the “Company,” “we,” “our,” or “us”) is a holding company that operates through a number of subsidiaries and is the premier financial brand for higher education.

While the Sallie Mae name has existed for more than 50 years, the company that operates as Sallie Mae today, SLM Corporation, was formed in late 2013 and includes its wholly-owned subsidiary, Sallie Mae Bank, an industrial bank established in 2005 (the “Bank”).

On April 30, 2014, we legally separated (the “Spin-Off”) from another public company that is now named Navient Corporation (“Navient”), which is in the education loan management, servicing, asset recovery, and consolidation loan business.

We are a consumer banking business and did not retain any assets or liabilities generated prior to the Spin-Off other than those explicitly retained by us.

We are a consumer banking business and did not retain any assets or liabilities generated prior to the Spin-Off other than those explicitly retained by us pursuant to the documents executed in connection with the Spin-Off.

We sometimes refer to the company that existed prior to the Spin-Off as “pre-Spin-Off SLM.”

7 unchanged sentences

The Bank is regulated by the Utah Department of Financial Institutions (the “UDFI”), the Federal Deposit Insurance Corporation (the “FDIC”), and the Consumer Financial Protection Bureau (the “CFPB”).

2021 Form 10-K — SLM CORPORATION F-15

F-15 SLM CORPORATION — 2022 Form 10-K

Significant Accounting Policies

15 unchanged sentences

We periodically sell Private Education Loans through securitization transactions where we are required to retain a five percent vertical risk retention interest (i.e., five percent of each class issued in the securitizations).

We classified those vertical risk retention interests related to the transactions as available-for-sale investments, except for the interest in the residual classes, which we classified as trading investments recorded at fair value with changes recorded through earnings.

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.

We also hold an investment in a debt security that is classified as a trading investment.

We recorded the initial investment at cost and subsequently measure the investment at fair value with changes in market value recorded through earnings.

Available-for-Sale Investments

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If any credit impairment exists, an allowance for losses is established for the amount of the unrealized loss that is determined to be credit-related.

2022 Form 10-K — SLM CORPORATION F- 16

Significant Accounting Policies (Continued)

Other Investments

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These investments generate a return mostly through realization of federal tax credits.

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Significant Accounting Policies (Continued)

Loans Held for Investment

Loans, consisting of Private Education Loans, FFELP Loans, and our suite of credit cards (“Credit Cards”) that we have the ability and intent to hold for the foreseeable future, are classified as held for investment, and are carried at amortized cost.

Amortized cost includes the unamortized premiums, discounts, and capitalized origination costs and fees, all of which are amortized to interest income as discussed under “Loan Interest Income.” Loans which are held for investment are reported net of an allowance for credit losses.

Amortized cost includes the unamortized premiums, discounts, and capitalized origination costs and fees, all of which are amortized to interest income as discussed under “Loan Interest Income.” Loans that are held for investment are reported net of an allowance for credit losses.

At September 30, 2022, we transferred our Credit Card portfolio to loans held for sale as we plan to sell our Credit Card portfolio.

For additional information, see Notes to Consolidated Financial Statements, Note 6, “Loans Held for Sale.”

Loans Held for Sale

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The ASU does not mandate the use of any specific method for estimating credit loss, permitting companies to use judgment in selecting the approach that is most appropriate in their circumstances.

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Significant Accounting Policies (Continued)

Adoption of the standard had a material impact on how we record and report our financial condition and results of operations, and on regulatory capital.

The following table illustrates the impact of the cumulative effect adjustment made upon adoption of CECL on January 1, 2020:

2021 Form 10-K — SLM CORPORATION F-17

Significant Accounting Policies (Continued)

January 1, 2020

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This transition adjustment shown above is inclusive of qualitative adjustments incorporated into our CECL allowance as necessary, to address any limitations in the models used.

Under regulations issued by the FDIC and other federal banking agencies, banking organizations that adopt CECL during the 2020 calendar year, including the Bank, may elect 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.

The Bank has elected to use this option.

Under regulations issued by the FDIC and other federal banking agencies, banking organizations that adopted CECL during the 2020 calendar year, including the Bank, could elect 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.

The Bank elected to use this option.

Therefore, the regulatory capital impact of the Bank’s transition adjustments recorded on January 1, 2020 from the adoption of CECL, and 25 percent of the ongoing impact of CECL on the Bank’s allowance for credit losses, retained earnings, and average total consolidated assets, each as reported for regulatory capital purposes (collectively, the “adjusted transition amounts”), were deferred for the two-year period ending January 1, 2022.

From January 1, 2022 to January 1, 2025, 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.

On January 1, 2022, 25 percent of the adjusted transition amounts were phased in for regulatory capital purposes.

On January 1 of each year from 2023 to 2025, the adjusted transition amounts will continue to 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.

For additional information, see Note 19, “Regulatory Capital.”

Allowance for Credit Losses - 2021 and 2020

Allowance for Credit Losses

We maintain an allowance for credit losses for the lifetime expected credit losses on loans in our portfolios, as well as for future loan commitments, at the reporting date.

In determining the lifetime expected credit losses on our Private Education Loan portfolio loan segments, we use a discounted cash flow model.

In determining the lifetime expected credit losses on our Private Education Loan portfolio loan segments, we use a discounted cash flow method.

This method requires us to project future principal and interest cash flows on our loans in those portfolios.

To estimate the future expected cash flows, we use a vintage-based model that considers life of loan loss expectations, prepayments (both voluntary and involuntary), defaults, recoveries, and any other adjustments deemed necessary, to determine the adequacy of the allowance at each balance sheet date.

To estimate the future expected cash flows, we use a vintage-based methodology that considers life of loan loss expectations, prepayments, defaults, recoveries, and any other adjustments deemed necessary, to determine the adequacy of the allowance at each balance sheet date.

These cash flows are discounted at the loan’s effective interest rate to calculate the present value of those cash flows.

Management adjusts the effective interest rate used to discount expected cash flows to incorporate expected prepayments.

The difference between the present value of those cash flows and the amortized cost basis of the underlying loans is the allowance for credit losses.

The difference between the present value of those cash flows

2022 Form 10-K — SLM CORPORATION F- 18

Significant Accounting Policies (Continued)

and the amortized cost basis of the underlying loans is the allowance for credit losses.

Entities that measure credit losses based on the present value of expected future cash flows are permitted to report the entire change in present value as credit loss expense, but may alternatively report the change in present value due to the passage of time as interest income.

We have elected to report the entire change in present value as credit loss expense.

We have elected to report the entire change in present value as provision for credit loss expense.

In determining the loss rates used for the vintage-based approach, we start with our historical loss rates, stratify the loans within each vintage, and then adjust the loss rates based upon economic factors forecasted over a reasonable and supportable forecast period.

The reasonable and supportable forecast period is meant to represent the period in which we

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Significant Accounting Policies (Continued)

believe we can estimate the impact of forecasted economic factors in our expected losses.

The reasonable and supportable forecast period is meant to represent the period in which we believe we can estimate the impact of forecasted economic factors in our expected losses.

At the end of the reasonable and supportable forecast period, we immediately revert our forecast of expected losses to our historical averages.

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As with our loss forecasts, at the end of the two-year reasonable and supportable forecast for prepayments, we immediately revert to our historical long-term prepayment rates.

In addition to the above modeling approach, we also take certain other qualitative factors into consideration when calculating the allowance for credit losses.

These qualitative factors include, but are not limited to, changes in lending policies and procedures, including changes in underwriting standards and collection, charge-off, and recovery practices not already included in the analysis, and the effect of other external factors such as legal and regulatory requirements on the level of estimated current expected credit losses.

In addition to the above modeling approach, we also take certain other qualitative factors into consideration when calculating the allowance for credit losses, which could result in management overlays (increases or decreases to the allowance for credit losses).

These management overlays can encompass a broad array of factors not captured by model inputs, including but not limited to, changes in lending policies and procedures, including changes in underwriting standards, changes in servicing policies, collection administration practices, state law changes that could impact servicing and collection practices, charge-offs, recoveries not already included in the analysis, the effect of other external factors such as legal and regulatory requirements on the level of estimated current expected credit losses, the performance of the model over time versus actual losses, and any other operational or regulatory changes that could affect our estimate of future losses.

The evaluation of the allowance for credit losses is inherently subjective, as it requires material estimates that may be susceptible to significant changes.

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• Recovery rates.

Management overlays can encompass a broad array of factors not captured by model inputs, including but not limited to, changes in servicing policies, collection administrative practices, state law changes that could impact servicing and collection practices, and observed differences between forecasted and actual results.

Below we describe in further detail our policies and procedures for the allowance for credit losses as they relate to our Private Education Loan, Credit Card, and FFELP Loan portfolios.

Below we describe in further detail our policies and procedures for the allowance for credit losses as they relate to our Private Education Loan and FFELP Loan portfolios.

During the third quarter of 2022, we reclassified our Credit Card loan portfolio to loans held-for-sale, as we plan to exit and sell our credit card business.

During the third quarter of 2020, we sold our entire Personal Loan portfolio.

Allowance for Private Education Loan Losses - 2021 and 2020

Allowance for Private Education Loan Losses

In addition to the key assumptions/estimates described above, some estimates are unique to our Private Education Loan portfolio.

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These dates can change based upon many factors.

We receive information regarding projected graduation dates from a third-party clearinghouse.

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information regarding projected graduation dates from a third-party clearinghouse.

The separation from school date is updated quarterly based on updated information received from the clearinghouse.

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Once the loan is funded, that liability transfers to the allowance for Private Education Loan losses.

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Significant Accounting Policies (Continued)

Key Credit Quality Indicators - Private Education Loans - 2021 and 2020

Key Credit Quality Indicators - Private Education Loans

We determine the collectability of our Private Education Loan portfolio by evaluating certain risk characteristics.

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As part of concluding on the adequacy of the allowance for credit losses for Private Education Loans, we review key allowance and loan metrics.

The most relevant of these metrics considered are the allowance as a percentage of ending total loans, delinquency percentages, and forbearance percentages.

The most relevant of these metrics considered are the allowance as a percentage of ending total loans and accrued interest to be capitalized and of ending loans in repayment and accrued interest to be capitalized on loans in repayment, delinquency percentages, and forbearance percentages.

We consider a Private Education Loan to be delinquent if the borrower has not made a required payment prior to the 31st day after such payment was contractually due.

Troubled Debt Restructurings (“TDRs”) - 2021 and 2020

In estimating the expected defaults for our Private Education Loans that are considered TDRs, we follow the same discounted cash flow process described above but use the historical loss rates related to past TDR loans.

The appropriate gross loss rates are determined for each individual loan by evaluating loan maturity, risk characteristics, and macroeconomic conditions.

The allowance for our TDR portfolio is included in our overall allowance for Private Education Loans.

Our TDR portfolio is comprised mostly of loans with interest rate reductions and loans with forbearance usage greater than three months, as further described below.

Adoption of ASU No.

2022-02, “Troubled Debt Restructurings and Vintage Disclosures”

On March 31, 2022, the FASB issued ASU No.

2022-02, “Troubled Debt Restructurings and Vintage Disclosures” (“ASU No.

2022-02”), which eliminated the accounting guidance for troubled debt restructurings (“TDRs”) while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty.

The enhanced disclosures are required to be provided for modifications made starting in the period of adoption.

Information about modifications in periods before adoption is not required to be provided.

2022-02 also requires that entities disclose current-period gross charge-offs by year of origination.

For entities that have adopted the amendments in CECL, the amendment is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

Early adoption of the amendments in ASU No.

2022-02 is permitted if an entity has adopted CECL.

The amendments should be applied prospectively.

For the transition method related to the recognition and measurement of TDRs, an entity has the option to apply a modified retrospective transition method.

We have elected to early adopt all aspects of ASU No.

2022-02 prospectively for the period beginning January 1, 2022.

The adoption was immaterial to our consolidated financial statements.

For additional information, see Note 7, "Allowance for Credit Losses," in this Form 10-K.

2022 Form 10-K — SLM CORPORATION F- 20

Significant Accounting Policies (Continued)

Troubled Debt Restructurings - 2021 and 2020

In the years ended December 31, 2021 and 2020, in estimating the expected defaults for our Private Education Loans that were considered TDRs, we followed the same discounted cash flow process described above but used the historical loss rates related to past TDR loans.

The appropriate gross loss rates were determined for each individual loan by evaluating loan maturity, risk characteristics, and macroeconomic conditions.

The allowance for our TDR portfolio was included in our overall allowance for Private Education Loans.

Our TDR portfolio was comprised mostly of loans with interest rate reductions and loans with forbearance usage greater than three months, as further described below.

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 loans.

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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.

We classify a loan as a TDR due to forbearance using a two-step process.

The first step is to identify a loan that was in full principal and interest repayment status and received more than three months of forbearance in a 24 -month period;

however, during the first nine months after a loan had entered full principal and interest repayment status, we do not count up to the first six months of forbearance received during that period against the three-month policy limit.

The second step is to evaluate the creditworthiness of the loan by examining its most recent refreshed FICO score.

Loans that have met the criteria in the first test and have a FICO score above a certain threshold (based on the most recent quarterly FICO

F-20 SLM CORPORATION — 2021 Form 10-K

Significant Accounting Policies (Continued)

score refresh) will not be classified as TDRs.

Loans that have met the criteria in the first test and have a FICO score under the threshold (based on the most recent quarterly FICO score refresh) will be classified as TDRs.

A loan also becomes a TDR when it is modified to reduce the interest rate on the loan (regardless of when such modification occurs and/or whether such interest rate reduction is temporary).

Once a loan qualifies for TDR status, it remains a TDR for allowance purposes for the remainder of its life.

About half our loans that are considered TDRs involve a temporary forbearance of payments and do not change the contractual interest rate of the loan.

As of both December 31, 2021 and 2020, approximately 47 percent of TDRs were classified as such due to their forbearance status.

For additional information, see Note 7, “Allowance for Credit Losses.”

On March 27, 2020, then President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which, among other things, allows us to (i) elect to suspend the requirements under GAAP for loan modifications related to COVID-19 that would otherwise be categorized as TDRs, and (ii) suspend any determination of a loan modified as a result of the effects of COVID-19 as being a TDR, including impairment for accounting purposes.

Furthermore, on December 27, 2020, the Consolidated Appropriations Act, 2021 (the “CAA”) was signed into law.

The CAA provides for additional COVID-19 focused relief and extends certain provisions of the CARES Act.

We have elected to suspend TDR accounting for both forbearance and interest rate modifications of loans that occur as a result of COVID-19 for the applicable period of the CARES Act and CAA relief.

The relief from TDR guidance applies to modifications of loans that were not more than 30 days past due as of December 31, 2019, and that occur during the period beginning on March 1, 2020, and ending on the earlier of (i) sixty days after the date on which the national emergency related to the COVID-19 outbreak is terminated, or (ii) January 1, 2022.

We are continuing to apply TDR accounting to those loans that were more than 30 days past due as of December 31, 2019 and were subsequently modified.

Off-Balance Sheet Exposure for Contractual Loan Commitments - 2021 and 2020

We classified a loan as a TDR due to forbearance using a two-step process.

The first step was to identify a loan that was in full principal and interest repayment status and received more than three months of forbearance in a 24 -month period;

however, during the first nine months after a loan had entered full principal and interest repayment status, we did not count up to the first six months of forbearance received during that period against the three-month policy limit.

The second step was to evaluate the creditworthiness of the loan by examining its most recent refreshed FICO score.

Loans that met the criteria in the first test and had a FICO score above a certain threshold (based on the most recent quarterly FICO score refresh) were not classified as TDRs.

Loans that met the criteria in the first test and had a FICO score under the threshold (based on the most recent quarterly FICO score refresh) were classified as TDRs.

A loan also became a TDR when it was modified to reduce the interest rate on the loan (regardless of when such modification occurred and/or whether such interest rate reduction was temporary).

Once a loan qualified for TDR status, it remained a TDR for allowance purposes for the remainder of its life.

About half our loans that were considered TDRs involved a temporary forbearance of payments and did not change the contractual interest rate of the loan.

Off-Balance Sheet Exposure for Contractual 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.

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The portion of the allowance for credit losses related to future disbursements is shown as a liability on the face of the balance sheet, and related provision for credit losses is reflected on the income statement.

Uncollectible Interest - 2021 and 2020

Uncollectible Interest

The majority of the total accrued interest receivable on our Private Education Loan portfolio represents accrued interest on deferred loans where no payments are due while the borrower is in school and on fixed-pay loans where the borrower makes a $ 25 monthly payment that is smaller than the interest accrued on the loan in that month.

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Accrued interest receivable is separately disclosed on the face of the balance sheet.

Allowance for Credit Card Loans - 2021 and 2020

We use the gross loss approach when estimating the allowance for credit losses for our Credit Card portfolio.

Because our Credit Card portfolio is new and we do not have sufficient historical loss experience, we use estimated loss rates reported by other financial institutions to estimate our allowance for credit losses for Credit Cards, net of expected recoveries.

In addition, we use a model that utilizes purchased credit card information with risk characteristics similar to those of our own portfolio as a challenger model.

We then consider any qualitative factors that may change our future expectations of losses.

As all of our Credit Card loans are unconditionally cancelable by us, the issuer, we do not record any estimate of credit losses for unused portions of our Credit Card commitments.

2021 Form 10-K — SLM CORPORATION F-21

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Significant Accounting Policies (Continued)

Allowance for FFELP Loan Losses - 2021 and 2020

Allowance for Credit Card Loans - 2021 and 2020

At September 30, 2022, we transferred our Credit Card portfolio to loans held for sale as we plan to sell our Credit Card portfolio.

At that time, we reversed $ 2.4 million through the provisions for credit losses for the allowance related to these loans, when the loans were transferred to held for sale.

For the years ended December 31, 2021 and 2020, we used the gross loss approach when estimating the allowance for credit losses for our Credit Card portfolio.

Because our Credit Card portfolio was new and we did not have sufficient historical loss experience, we used estimated loss rates reported by other financial institutions to estimate our allowance for credit losses for Credit Cards, net of expected recoveries.

In addition, we used a model that utilizes purchased credit card information with risk characteristics similar to those of our own portfolio as a challenger model.

We then considered any qualitative factors that may change our future expectations of losses.

As all of our Credit Card loans are unconditionally cancelable by us, the issuer, we did not record any estimate of credit losses for unused portions of our Credit Card commitments.

Allowance for FFELP Loan Losses

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.

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Once the quantitative calculation is performed, we review the adequacy of the allowance for credit losses and determine if qualitative adjustments need to be considered.

Allowance for Credit Losses - 2019

Prior to January 1, 2020, we maintained an allowance for credit losses at an amount sufficient to absorb probable losses incurred in our portfolios, as well as regarding future loan commitments, at the reporting date based on a projection of estimated probable credit losses incurred in the portfolio.

We considered a loan to be impaired when, based on current information, a loss had been incurred and it was probable that we would not receive all contractual amounts due.

When making our assessment as to whether a loan was impaired, we also took into account more than insignificant delays in payment.

We generally evaluated impaired loans on an aggregate basis by grouping similar loans.

We analyzed our portfolios to determine the effects that the various stages of delinquency and forbearance had on borrower default behavior and ultimate charge off.

We estimated the allowance for credit losses for our loan portfolios using a roll rate analysis of delinquent and current accounts.

A “roll rate analysis” is a technique used to estimate the likelihood that a loan receivable may progress through the various delinquency stages and ultimately charge off.

We also took into account the current and future economic environment and certain other qualitative factors when calculating the allowance for credit losses.

The evaluation of the allowance for credit losses is inherently subjective, as it required material estimates that may be susceptible to significant changes.

Our default estimates were based on a loss emergence period of one year for Private Education Loans, Personal Loans, and Credit Cards and two years for FFELP Loans.

A loss emergence period represents the expected period between the first occurrence of an event likely to cause a loss on a loan and the date the loan is expected to be charged off, taking into consideration account management practices that affect the timing of a loss, such as the usage of forbearance.

The loss emergence period underlying the allowance for credit losses was subject to a number of assumptions.

If actual future performance in delinquency, charge-offs, and recoveries was significantly different than estimated, or account management assumptions or practices were to change, this could materially affect the estimate of the allowance for credit losses, the timing of when losses were recognized, and the related provision for credit losses on our consolidated statements of income.

We utilized various models to determine an appropriate allowance for credit losses.

Changes to model inputs were made as deemed necessary.

The models were reviewed and validated periodically.

Below we describe in further detail our policies and procedures for the allowance for credit losses in 2019 as they relate to our Private Education Loan, Personal Loan, FFELP Loan portfolios and Credit Cards.

Allowance for Private Education Loan Losses - 2019

Prior to January 1, 2020, in determining the allowance for credit losses on our Private Education Loans that are not TDRs, we estimated the principal amount of loans that would default over the next year (one year being the expected period between a loss trigger event and default) using a roll rate model and how much we expected to recover over the same one-year period related to the defaulted amount.

The expected defaults less our expected recoveries adjusted for any qualitative factors (discussed below) equaled the allowance related to this portfolio.

Our historical experience indicates that, on average, the time between the date that a customer experiences a default causing event (i.e., the loss trigger event) and the date that we charge off the unrecoverable portion of that loan is one year.

In estimating both the non-TDR and TDR allowance amounts, we started with historical experience of customer delinquency and default behavior.

We made judgments about which historical period to start with and then made further judgments about whether that historical experience was representative of future expectations and whether additional

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Significant Accounting Policies (Continued)

adjustments may be needed to those historical default rates.

We also took certain other qualitative factors into consideration when calculating the allowance for credit losses.

These qualitative factors included, but were not limited to, changes in the economic environment, changes in lending policies and procedures, including changes in underwriting standards and collection, charge-off, and recovery practices not already included in the analysis, and the effect of other external factors, such as legal and regulatory requirements, on the level of estimated credit losses.

Certain Private Education Loans do not require borrowers to begin repayment until at least six months after they have graduated or otherwise separated from school.

Consequently, the loss estimates for these loans were generally low while the borrower was in school.

As this population of borrowers left school, they would be required to begin payments on their loans, and the allowance for losses could change accordingly.

Similar to the rules governing FFELP payment requirements, our collection policies allow for periods of nonpayment for borrowers requesting additional payment grace periods upon leaving school or experiencing temporary difficulty meeting payment obligations.

This is referred to as forbearance status and was considered separately in the allowance for credit losses.

The loss emergence period was in alignment with the typical collection cycle and took into account these periods of nonpayment.

As part of concluding on the adequacy of the allowance for credit losses, we reviewed key allowance and loan metrics.

The most relevant of these metrics considered were the allowance coverage of net charge-offs ratio;

the allowance as a percentage of ending total loans and of ending loans in repayment;

and delinquency and forbearance percentages.

We consider a loan to be delinquent if the borrower has not made a required payment prior to the 31st day after such payment was contractually due.

We used a model to estimate the amount of uncollectible accrued interest on Private Education Loans and reserved for that amount against current period interest income.

Our non-TDR allowance for credit losses was estimated using an analysis of delinquent and current accounts.

Our roll rate model was used to estimate the likelihood that a loan receivable may progress through the various delinquency stages and ultimately charge off.

Once a charge-off forecast was estimated, a recovery assumption was layered on top.

In estimating recoveries, we used both estimates of what we would receive from the sale of defaulted loans as well as historical borrower payment behavior to estimate the timing and amount of future recoveries on charged-off loans.

The roll rate analysis model was based upon actual experience using the 120 day charge-off default aversion strategies.

Once the quantitative calculation was performed, we reviewed the adequacy of the allowance for credit losses and determined if qualitative adjustments needed to be considered.

Allowance for Personal Loans - 2019

Prior to January 1, 2020, we maintained an allowance for Personal Loan losses at an amount sufficient to absorb losses estimated and viewed at the reporting date as probable credit losses to be incurred in the portfolio.

In determining the allowance for credit losses on our Personal Loan portfolio that were not TDRs, we estimated the principal amount of the loans that would default over the next twelve months (twelve months being the expected period between a loss trigger event and default) and how much we expected to recover over the same twelve-month period related to the defaulted amounts.

The expected defaults less our expected recoveries adjusted for any qualitative factors equaled the allowance related to this portfolio.

At December 31, 2019, there were no Personal Loans classified as TDRs.

Troubled Debt Restructurings - 2019

Separately, for our TDR portfolio, we estimated an allowance amount sufficient to cover life-of-loan expected losses through an impairment calculation based on the difference between the loan’s basis and the present value of expected future cash flows (which would include life-of-loan default and recovery assumptions) discounted at the loan’s original effective interest rate.

Our TDR portfolio is comprised mostly of loans with interest rate reductions and loans with forbearance usage greater than three months during a 24-month period, as further described above.

Allowance for FFELP Loan Losses - 2019

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.

For loans disbursed prior to October 1, 1993, we receive 100 percent reimbursement.

The 2019 allowance for FFELP Loan losses used historical experience of customer default behavior and a two-year loss emergence period to estimate the credit losses incurred in the loan portfolio at the reporting date.

We applied the

Business Combination

On March 4, 2022, we completed the acquisition of the assets primarily used or held for use of Epic Research Education Services, LLC, which does business as Nitro College (“Nitro”).

Nitro provides resources that help students and families evaluate how to responsibly pay for college and manage their financial responsibilities after graduation.

The addition of Nitro will support our mission of providing students with the confidence needed to successfully navigate the higher education journey.

The acquisition of the Nitro assets, including its employees and intellectual property, has expanded our digital marketing capabilities, reduced the cost to acquire customer accounts, and accelerated our progress to become a broader education solutions provider for students before, during, and immediately after college.

The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with the FASB’s Accounting Standard Codification 805, “Business Combinations,” whereby as of the acquisition date, the acquired tangible assets and liabilities were recorded at their estimated fair values.

The identifiable intangible assets were recorded at fair values as determined by an independent appraiser.

The final purchase price allocation for Nitro resulted in an excess purchase price over fair value of net assets acquired, or goodwill, of $ 51 million.

The results of operations of Nitro have been included in our consolidated financial statements since the acquisition date.

We have not disclosed the pro forma impact of this acquisition to the results of operations for the year ended December 31, 2022, as the pro forma impact was deemed immaterial.

Transaction costs associated with the Nitro acquisition were approximately $ 3 million and were expensed as incurred within “Other operating expenses” in the consolidated statements of income.

Identifiable intangible assets at the acquisition date included definite life intangible assets with an aggregate fair value of approximately $ 75 million, including tradename and trademarks, customer relationships, and developed technology.

See “— Goodwill and Acquired Intangible Assets,” and Notes to Consolidated Financial Statements, Note 10, “Goodwill and Acquired Intangible Assets” in this Form 10-K for additional details.

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Significant Accounting Policies (Continued)

default rate projections, net of applicable risk sharing, to each category for the relevant period to perform our quantitative calculation.

Once the quantitative calculation was performed, we reviewed the adequacy of the allowance for credit losses and determined if qualitative adjustments needed to be considered.

Allowance for Credit Card Loans - 2019

The 2019 allowance for Credit Card losses was management’s estimate of credit losses inherent in the Credit Card portfolio at the relevant balance sheet date.

The allowance for Credit Card losses used historical loss rates for accounts with similar characteristics (based on industry data) as a reasonable basis to estimate future losses.

At December 31, 2019, there were no Credit Cards classified as TDRs .

Goodwill and Acquired Intangible Assets

Acquisitions are accounted for under the acquisition method of accounting, which results in the Company allocating the purchase price to the fair value of the acquired assets, liabilities, and non-controlling interests, if any, with the remaining purchase price allocated to goodwill.

Goodwill is not amortized but is tested periodically for impairment.

We test goodwill for impairment annually in the fourth quarter of the year, or more frequently if we believe that indicators of impairment exist.

We complete a goodwill impairment analysis, which may be a qualitative or a quantitative analysis depending on the facts and circumstances associated with the reporting unit.

In conjunction with a qualitative impairment analysis, we assess relevant qualitative factors to determine whether it is “more-likely-than-not” that the fair value of a reporting unit is less than its carrying amount.

The “more-likely-than-not” threshold is defined as having a likelihood of more than 50 percent.

If, based on first assessing impairment utilizing a qualitative approach, we determine it is “more-likely-than not” that the fair value of the reporting unit is less than its carrying amount, we will also complete a quantitative impairment analysis.

In conjunction with a quantitative impairment analysis, we compare the fair value of the reporting unit to the reporting unit’s carrying value, including goodwill.

If the carrying value of the reporting unit exceeds the fair value, goodwill is impaired in an amount equal to the amount by which the carrying value exceeds the fair value of the reporting unit, but not to exceed the goodwill amount attributed to the reporting unit.

Acquired intangible assets include trade names and trademarks, customer relationships, and developed technology.

Our acquired intangible assets have finite lives and are amortized over their estimated useful lives in proportion to their estimated economic benefit.

We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.

See Notes to Consolidated Financial Statements, Note 10, “Goodwill and Acquired Intangible Assets” in this Form 10-K for additional details.

Our retail deposit accounts are principally certificates of deposit (“CDs”), money market deposit accounts (“MMDAs”), and high-yield savings (“HYS”) accounts.

20 unchanged sentences

When possible, we seek to validate the model’s output to market transactions.

Depending on the availability of observable inputs and prices, different valuation models could produce materially different fair value estimates.

Depending on the availability of observable inputs and prices, different valuation

F-23 SLM CORPORATION — 2022 Form 10-K

Significant Accounting Policies (Continued)

models could produce materially different fair value estimates.

The values presented may not represent future fair values and may not be realizable.

9 unchanged sentences

However, significant judgment is required by us in developing the inputs.

F-24 SLM CORPORATION — 2021 Form 10-K

Significant Accounting Policies (Continued)

Loan Interest Income

23 unchanged sentences

We do not amortize any adjustments to the basis of loans when they are classified as held-for-sale.

With the adoption of CECL on January 1, 2020, we continue to analyze the collectability of accrued interest associated with loans not currently in full principal and interest repayment status or interest-only repayment status as discussed above;

however, we have changed the recognition of the allowance for this portion of uncollectible interest (amounts to be capitalized after separation from school and the expiration of the grace period) to the provisions for credit losses from our historical practice of recording it as a reduction of interest income, as well as classifying this allowance as part of our allowance for credit losses as opposed to our historical practice of recording it as a reduction of accrued interest income receivable.

For loans not currently in full principal and interest repayment status or interest-only repayment status, we recognize the allowance for the portion of uncollectible interest representing amounts to be capitalized after separation from school

2022 Form 10-K — SLM CORPORATION F- 24

Significant Accounting Policies (Continued)

and the expiration of the grace period to the provisions for credit losses and classify this allowance as part of our allowance for credit losses.

The allowance for the portion of uncollectible interest on loans making full interest payments will continue to be recorded as a reduction of interest income.

As we maintain an allowance for uncollectible interest on loans making full interest payments and an allowance for credit losses for the interest on loans where all, or a portion of the interest, will be capitalized in the future, we do not place loans in nonaccrual status prior to charge-off.

However, if it is determined that an individual loan or pool of loans is high risk, they may be placed on nonaccrual status, which entails stopping the accrual of interest on those loans until such time that the borrower(s) have made a sufficient number of payments (typically six months) to return to accrual status.

At December 31, 2022 and 2021, we had no loans in nonaccrual status.

1 unchanged sentence

Fee income is recorded when earned in “other non-interest income” in the accompanying consolidated statements of income.

2021 Form 10-K — SLM CORPORATION F-25

Significant Accounting Policies (Continued)

Interest Expense

Interest expense is based upon contractual interest rates adjusted for the amortization of issuance costs.

We incur interest expense on interest-bearing deposits comprised of non-maturity savings deposits, brokered and retail CDs, and brokered and retail MMDAs, as well as on unsecured and secured financings.

Interest expense is recognized when amounts are contractually due to deposit and debt holders and is adjusted for net payments/receipts related to interest rate swap agreements that qualify and are designated hedges of interest-bearing liabilities.

Interest expense also includes the amortization of deferred gains and losses on closed hedge transactions that qualified as hedges.

Interest expense is based upon contractual interest rates and other fees, adjusted for the amortization of issuance costs, premiums, and discounts.

We incur interest expense on interest-bearing deposits comprised of non-maturity savings deposits, brokered and retail CDs, brokered and retail MMDAs, as well as unsecured and secured financings.

Our Private Education Loan multi-lender secured borrowing facility also incurs an unused facility fee on the amount of unfunded commitments.

Interest expense is recognized when amounts are contractually due and is adjusted for net payments/receipts related to qualifying interest rate swap agreements designated as hedges of interest-bearing liabilities.

Interest expense also includes the amortization of deferred gains and losses on closed qualifying hedge transactions.

Amortization of debt issuance costs, premiums, discounts, and terminated hedge-basis adjustments are recognized using the effective interest rate method.

We incur certain fees related to our Private Education Loan multi-lender secured borrowing facility (the “Secured Borrowing Facility”), including an unused Secured Borrowing Facility fee, and also incur fees related to our term asset-backed securities (“ABS”).

These fees are included in interest expense.

Refer to Note 11, “Deposits,” and Note 12, “Borrowings” for further details of our interest-bearing liabilities.

Gains on Sale of Loans, Net

We may participate and sell loans to third-parties and affiliates, including entities that were related parties prior to the Spin-Off.

We may participate and sell loans to third parties and affiliates.

These sales may occur through whole loan sales or securitization transactions that qualify for sales treatment.

2 unchanged sentences

These loans were initially recorded as held for investment and were transferred to held-for-sale immediately prior to sale or securitization.

In 2021, we recognized $ 548 million in gains from the sale of approximately $ 4.24 billion of our Private Education Loans, including $ 3.98 billion of principal and $ 264 million in capitalized interest, to unaffiliated third parties.

In 2020, we recognized $ 238 million in gains from the sale of approximately $ 3.1 billion of our Private Education Loans, including $ 2.9 billion of principal and $ 199 million in capitalized interest, to unaffiliated third parties.

We did not sell loans in 2019.

Included in other income are late fees on both Private Education Loans and FFELP Loans, which we recognize when the cash has been received, fees related to our Credit Card program, income for servicing private student loans for third-parties, and changes to our tax indemnification receivable from Navient.

Our former Upromise subsidiary had a number of programs that encouraged consumers to save for the cost of college education.

We had established a consumer savings network, which was designed to promote college savings by consumers who were members of this program by encouraging them to purchase goods and services from the merchants that participated in the program.

Participating merchants generally paid Upromise fees based on member purchase volume, either online or in stores, depending on the contractual arrangement with the merchant.

We recognized revenue as marketing and administrative services were rendered, based upon contractually determined rates and member purchase volumes.

On May 31, 2020, we sold our Upromise subsidiary to a third party, resulting in the loss of revenue from that business for the second half of 2020.

Included in other income are late fees on both Private Education Loans and FFELP Loans, which we recognize when the cash has been received, income for servicing private student loans for third-parties, and changes to our tax indemnification receivable from Navient.

Other income also includes fees related to our Credit Card program.

At September 30, 2022, we transferred our Credit Card portfolio to loans held for sale as we plan to sell our Credit Card portfolio.

Securitization Accounting

1 unchanged sentence

Transactions receiving sale treatment are also structured to ensure that the holders of the beneficial interests issued are not constrained from pledging or exchanging their interests, and that we do not maintain effective control over the transferred assets.

If these criteria are not met, then the transaction is accounted for as an on-balance sheet secured borrowing.

If a securitization qualifies as a sale, we then assess whether we are the primary beneficiary of the securitization trust and are required to consolidate such trust.

If these criteria are not met, the transaction does not meet the criteria for sale treatment and is accounted for as an on-balance sheet secured borrowing.

If a securitization qualifies as a sale, we assess whether Sallie Mae is the primary beneficiary of the securitization trust and thus required to consolidate the trust.

We are considered the primary beneficiary if we have both:

1 unchanged sentence

and (ii) the obligation to absorb losses or receive benefits of the entity that could potentially be significant to the VIE.

There can be considerable judgment as it relates to determining the primary beneficiary of the VIEs.

There are no “bright line” tests.

Rather, the assessment of who has the power to direct the activities of the VIE that most significantly affect the VIE’s economic performance and who has the obligation to absorb losses or receive benefits of the entity that could potentially be significant to the VIE can be very qualitative and judgmental in nature.

If we are the primary beneficiary, then no gain or loss is recognized.

F-26 SLM CORPORATION — 2021 Form 10-K

Significant Accounting Policies (Continued)

We have determined that as the servicer of Sallie Mae securitization trusts, we meet the first primary beneficiary criterion because we have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance.

As there is not a bright-line test for determining significance, the assessment of who has the power to significantly direct the activities of the VIE, and who has the obligation to absorb losses or receive benefits material to the VIE, can be qualitative and judgmental in nature.

If we are determined to be the primary beneficiary, then no gain or loss is recognized on the transaction.

Irrespective of whether a securitization receives sale or on-balance sheet treatment, our continuing involvement with our securitization trusts is generally limited to:

• Owning the equity certificates of certain trusts;

F-25 SLM CORPORATION — 2022 Form 10-K

Significant Accounting Policies (Continued)

• The servicing of the student loan assets within the securitization trusts, on both a pre- and post-default basis;

7 unchanged sentences

Generally, the only recourse the securitization trusts have to us is in the event we breach a seller representation or warranty or our duties as master servicer and servicer, in which event we are obligated to repurchase the related loans from the trust.

From time to time, we also engage in certain transactions that are not consolidated on our balance sheet due to the transaction having met the criterion for sales treatment.

In 2022 and 2021, we also closed several loan sales and securitization transactions that were not consolidated on our balance sheet due to the transaction having met the criteria for sales treatment, for which Sallie Mae is not the primary beneficiary.

In these transactions, we remove loans from our consolidated balance sheet and recognize any assets retained and liabilities assumed at fair value, and record a gain or loss on the transferred loans.

17 unchanged sentences

Our derivative instruments are classified and accounted for by us as fair value hedges, cash flow hedges, and trading hedges.

2021 Form 10-K — SLM CORPORATION F-27

Significant Accounting Policies (Continued)

Each derivative is designated to a specific (or pool of) liability(ies) on the consolidated balance sheets, and is designated as either a “fair value” hedge or a “cash flow” hedge.

2 unchanged sentences

Cash flow hedges are designed to hedge our exposure to variability in cash flows related to variable-rate deposits.

The assessment of the hedge’s effectiveness is performed at inception and on an ongoing basis, using regression testing.

The assessment of the hedge’s effectiveness is performed at inception and on an

2022 Form 10-K — SLM CORPORATION F- 26

Significant Accounting Policies (Continued)

ongoing basis, using regression testing.

For hedges of a pool of liabilities, tests are performed to demonstrate the similarity of individual instruments of the pool.

22 unchanged sentences

Restructuring Activities

From time to time we implement plans to restructure our business.

During the third quarter of 2020, we initiated a restructuring program to reduce costs and improve operating efficiencies by better aligning our organizational structure with our new corporate strategic imperatives.

3 unchanged sentences

We recorded $ 1 million in additional restructuring expenses in the year ended December 31, 2021.

There were no restructuring expenses recorded in the year ended December 31, 2019.

We sponsor employee severance plans that provide severance benefits in the event of termination of our full-time employees and part-time employees who work at least 24 hours per week.

The severance plans establish specified

F-28 SLM CORPORATION — 2021 Form 10-K

Significant Accounting Policies (Continued)

benefits based on base salary, job level immediately preceding termination, and years of service upon termination of employment due to involuntary termination or a job abolishment, as defined in the severance plans.

The severance plans establish specified benefits based on base salary, job level immediately preceding termination, and years of service upon termination of employment due to involuntary termination or a job abolishment, as defined in the severance plans.

The benefits payable under the severance plans relate to past service.

1 unchanged sentence

Such benefits, including severance pay calculated based on the severance plan, medical and dental benefits, outplacement services, and continuation pay, were incurred during the year ended December 31, 2020, as a direct result of our restructuring initiative.

F-27 SLM CORPORATION — 2022 Form 10-K

Significant Accounting Policies (Continued)

Accordingly, such costs are classified as restructuring expenses in the accompanying consolidated statements of income.

We finalized this restructuring plan in 2020.

The majority of these restructuring expenses incurred through the year ended December 31, 2021 were severance costs related to the elimination of approximately 165 positions, or approximately 9 percent of the workforce that existed as of December 31, 2019.

We account for income taxes under the asset and liability approach, which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and tax basis of our assets and liabilities.

18 unchanged sentences

As of December 31, 2022 and 2021, no funds were on deposit with the FRB under this program.

2022 Form 10-K — SLM CORPORATION F- 28

Trading Investments

We periodically sell Private Education Loans through securitization transactions where we were required to retain a five percent vertical risk retention interest (i.e., five 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

2021 Form 10-K — SLM CORPORATION F-29

Investments (Continued)

residual classes, which we classify as trading investments recorded at fair value with changes recorded through earnings.

In the third quarter of 2022, we invested $ 5 million in a debt security classified as a trading investment and recorded the initial investment at cost.

The investment will subsequently be measured at fair value with changes in market value recorded through earnings.

At December 31, 2022 and 2021, we had $ 56 million and $ 37 million, respectively, classified as trading investments.

84 unchanged sentences

2053 111,518 100,258

2054 88,335 79,101

2055 102,497 96,290

2058 54,605 53,540

Total $ 2,554,332 $ 2,342,089

5 unchanged sentences

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.

Because these are non-marketable securities, we use observable price changes of identical or similar securities of the same issuer, or when observable prices are not available, use market data of similar entities, 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.

In the third quarter of 2019, we also funded an additional investment and, as a result, recorded a gain of $ 8 million on our earlier equity securities investments.

These gains were recorded in “other income” in the consolidated statements of income in 2021 and 2019.

At December 31, 2021 and December 31, 2020, our total investment in the securities of this issuer was $ 69 million and $ 26 million, respectively.

This gain was recorded in “gains (losses) on securities, net” in the consolidated statements of income in 2021.

In the fourth quarter of 2022, we determined that our investment in these non-marketable equity securities was impaired.

As such, we wrote down the value based upon an estimate of the value of these securities and recorded a loss of $ 60 million in “gains (losses) on securities, net” in the consolidated

F-31 SLM CORPORATION — 2022 Form 10-K

Investments (Continued)

statements of income in 2022.

At December 31, 2022 and December 31, 2021, our total investment in the non-marketable securities of this issuer was $ 8 million and $ 69 million, respectively.

Low Income Housing Tax Credit Investments

9 unchanged sentences

We sold our entire Personal Loan portfolio in the third quarter of 2020.

At September 30, 2022, we transferred our Credit Card portfolio to loans held for sale because we plan to sell our Credit Card portfolio.

For additional information, see Note 6, “Loans Held for Sale.”

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.

11 unchanged sentences

In the third quarter of 2020, we sold our entire Personal Loan portfolio, including $ 697 million of principal and $ 7 million in accrued interest, which resulted in a $ 43 million reduction to our provision for credit losses in that period.

In 2020, we recognized $ 238 million gains from the sale of approximately $ 3.1 billion of our Private Education Loans, including $ 2.9 billion of principal and $ 199 million in capitalized interest, to unaffiliated third-parties.

In 2021, we recognized $ 548 million gains from the sale of approximately $ 4.24 billion of our Private Education Loans, including $ 3.98 billion of principal and $ 264 million in capitalized interest, to unaffiliated third-parties.

In 2022, we recognized $ 328 million in gains from the sale of approximately $ 3.34 billion of our Private Education Loans, including $ 3.13 billion of principal and $ 217 million in capitalized interest, to unaffiliated third parties.

There were VIEs created in the execution of certain of these loan sales;

2 unchanged sentences

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 11, “Borrowings - Unconsolidated VIEs.”

For additional information, see Note 12, “Borrowings - Unconsolidated VIEs.”

2022 Form 10-K — SLM CORPORATION F- 32

20 unchanged sentences

The estimated weighted average life of education loans in our portfolio was approximately 5.0 years and 4.7 years at December 31, 2022 and 2021, respectively.

F-34 SLM CORPORATION — 2021 Form 10-K

Loans Held for Investment (Continued)

The average balance and the respective weighted average interest rates of loans in our portfolio are summarized as follows:

6 unchanged sentences

Total portfolio $ 21,238,931 $ 21,701,229 $ 23,776,111

F-33 SLM CORPORATION — 2022 Form 10-K

Loans Held for Investment (Continued)

Certain Collection Tools — Private Education Loans

19 unchanged sentences

In most instances, we require one payment, as an indication of a customer’s willingness and ability to repay, before granting forbearance to delinquent borrowers.

Historically, we have utilized disaster forbearance to assist borrowers affected by material events, including hurricanes, wildfires, floods, and the COVID-19 pandemic.

Historically, we have utilized disaster forbearance to assist borrowers affected by material events, typically federally-declared disasters, including hurricanes, wildfires, floods, and the COVID-19 pandemic.

We typically grant disaster forbearance to affected borrowers in increments of up to three months at a time, but the disaster forbearance granted generally does not apply toward the 12-month forbearance limit described below.

2021 Form 10-K — SLM CORPORATION F-35

Loans Held for Investment (Continued)

During COVID-19, our customers experienced higher levels of financial hardship, which initially led to higher levels of forbearance.

1 unchanged sentence

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 elevated levels of losses on this segment of our customers.

We expect that, left unabated, this deterioration in delinquency and default rates may persist until economic conditions return to pre-pandemic levels.

As borrowers in the various delinquency buckets exited disaster forbearance and began to enter repayment, we experienced elevated levels of losses on this segment of our customers.

Management continually monitors our credit administration practices and may periodically modify these practices based upon performance, industry conventions, and/or regulatory feedback.

3 unchanged sentences

However, due to the COVID-19 pandemic, in April 2020 we postponed our efforts so that we could be more flexible in dealing with our customers’ financial hardship.

In October 2020, we re-initiated a multi-phased deployment of certain previously announced credit administration practices changes.

In October 2020, we re-initiated a

2022 Form 10-K — SLM CORPORATION F- 34

Loans Held for Investment (Continued)

multi-phased deployment of certain previously announced credit administration practices changes.

In October 2021, we announced additional planned changes to our credit administration practices, which we implemented in December 2021.

12 unchanged sentences

We also now limit the number of interest rate reductions to twice over the life of the loan.

At December 31, 2021 and December 31, 2020, 7.2 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.

F-36 SLM CORPORATION — 2021 Form 10-K

Loans Held for Investment (Continued)

While there are limitations to our estimate of the future impact of the various credit administration practices changes we have implemented, absent the effect of any mitigating measures, we expect that the credit administration practices described above, including the changes we implemented in December 2021, will accelerate periodic defaults and could increase periodic defaults in our Private Education Loan held for investment portfolio by approximately 10.1 percent to 16.6 percent.

Among the measures that we have implemented and may modify further 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 loss mitigation programs (e.g., Graduated Repayment Period program (“GRP”) and rate modifications), and the use of a program offering short-term payment reductions (permitting interest-only payments for up to six months) for certain early-stage delinquencies.

While there are limitations to our estimate of the future impact of the various credit administration practices changes we have implemented, we expect that the credit administration practices described above, including the changes we implemented in 2021, will accelerate periodic defaults and will increase periodic defaults in our Private Education Loan held for investment portfolio.

For 2021, we increased our allowance for credit losses as a result of the new credit administration practices.

In the fourth quarter of 2022, we further increased our allowance for credit losses to reflect higher expected future periodic defaults in both the near term (reasonable and supportable period) and long term.

This change reflects our estimate that the elevated default rates experienced in the latter half of 2022 will continue into 2023 and then decline over time.

Among the measures that we have implemented and may modify further 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 loss mitigation programs (e.g., Graduated Repayment Period program (“GRP”) and rate modifications), the use of a program offering short-term payment reductions (permitting interest-only payments for up to six months) for certain early-stage delinquencies, and implementation of potential new risk mitigation and collection strategies.

The full impact of these changes to our collections practices described above will only be realized over the long term.

When we calculated the allowance for credit losses under CECL at December 31, 2021, our loan loss reserves were significantly impacted because we expect the life of loan defaults on our overall Private Education Loan portfolio to increase, in part as a result of the changes to our credit administration practices described above.

When we calculated the allowance for credit losses under CECL at December 31, 2022, our loan loss reserves were significantly affected because we expect the life of loan defaults on our overall Private Education Loan portfolio to increase, in part as a result of the changes to our credit administration practices described above.

We expect to learn more about how our borrowers are reacting to these changes to our credit administration practices 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.

6 unchanged sentences

Under these arrangements, we can pledge FFELP Loans or Private Education Loans to the FRB to secure any advances and accrued interest generated under the Primary Credit program at the FRB.

As of December 31, 2021 and 2020, we had $ 2.9 billion and $ 3.3 billion, respectively, of Private Education Loans pledged to this borrowing facility, as discussed further in Note 11, “Borrowings.” We did not have any FFELP consolidation loans pledged at December 31, 2021 or 2020.

As of December 31, 2022 and 2021, we had $ 2.7 billion and $ 2.9 billion, respectively, of

F-35 SLM CORPORATION — 2022 Form 10-K

Loans Held for Investment (Continued)

Private Education Loans pledged to this borrowing facility, as discussed further in Note 12, “Borrowings.” We did not have any FFELP Loans pledged at December 31, 2022 or 2021.

Loans Held for Investment by Region

1 unchanged sentence

As of December 31, 2022 2021

New York 9.4 % 9.7 %

California 9.8 % 9.6 %

New York 9.1 9.4

Pennsylvania 7.4 7.8

New Jersey 6.0 6.2

Texas 6.0 5.6

New Jersey 5.8 6.0

Florida 5.0 —

43.1 % 38.4 %

No other state had a concentration of total education loans in excess of 5 percent of the aggregate outstanding education loans held for investment.

2021 Form 10-K — SLM CORPORATION F-37

(In 2021, the concentration of education loans in Florida was less than 5 percent.)

Loans Held for Sale

We had no loans held for sale at December 31, 2021 and $ 2.9 billion loans held for sale at December 31, 2020.

At December 31, 2020, we reversed $ 206 million through the provisions for credit losses for the allowance related to these loans, when the loans were transferred from held for investment to held-for-sale.

For additional information on loan sales, see Note 5, “Loans Held for Investment,” and Note 11, “Borrowings — Unconsolidated VIEs.”

We had $ 29 million in loans held for sale at December 31, 2022 and no loans held for sale at December 31, 2021.

The balance at December 31, 2022 was comprised of our Credit Card loan portfolio.

At September 30, 2022, we reversed $ 2.4 million through the provisions for credit losses for the allowance related to these loans, when the loans were transferred from held for investment to held for sale.

At September 30, 2022, we wrote down this loan portfolio to its estimated fair value through a charge-off to the allowance for credit losses of $ 1.5 million.

Allowance for Credit Losses

2 unchanged sentences

We believe the allowance for credit losses is appropriate to cover lifetime expected losses incurred in the loan portfolios.

See Note 2, “Significant Accounting Policies — Allowance for Credit Losses - 2021 and 2020, — Allowance for Private Education Loan Losses - 2021 and 2020, — Allowance for FFELP Loan Losses - 2021 and 2020, — Allowance for Credit Card Loans - 2021 and 2020, — Allowance for Credit Losses - 2019, — Allowance for Private Education Loan Losses - 2019, — Allowance for FFELP Loan Losses - 2019, and — Allowance for Credit Card Loans - 2019” for a more detailed discussion.

F-38 SLM CORPORATION — 2021 Form 10-K

See Note 2, “Significant Accounting Policies — Allowance for Credit Losses, — Allowance for Private Education Loan Losses, — Allowance for FFELP Loan Losses, — Allowance for Credit Card Loans - 2021 and 2020,” for a more detailed discussion.

2022 Form 10-K — SLM CORPORATION F- 36

Allowance for Credit Losses (Continued)

3 unchanged sentences

Loans Private Education

Loans Credit Cards Total

Allowance for Credit Losses

12 unchanged sentences

Ending Balance $ 3,444 $ 1,353,631 $ — $ 1,357,075

Ending balance:

individually evaluated for impairment $ — $ 47,712 $ — $ 47,712

Allowance (3) :

Ending balance:

1 unchanged sentence

Ending balance:

individually evaluated for impairment $ — $ 1,057,665 $ — $ 1,057,665

collectively evaluated for impairment $ 609,050 $ 20,303,688 $ — $ 20,912,738

Accrued interest to be capitalized (3) :

Ending balance:

2 unchanged sentences

0.12 % 2.55 % — %

Allowance as a percentage of the ending total loan balance 0.59 % 5.59 % 9.12 %

Allowance as a percentage of the ending loans in repayment (3)

Allowance as a percentage of the ending total loan balance and accrued interest to be capitalized 0.57 % 6.37 % — %

Allowance as a percentage of the ending loans in repayment and accrued interest to be capitalized on loans in repayment (4)

0.76 % 8.76 % — %

5 unchanged sentences

$ 453,915 $ 15,129,550 $ —

Accrued interest to be capitalized on loans in repayment (5)

$ — $ 324,384 $ —

(1) See Note 8, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively.

13 unchanged sentences

Provisions for credit losses reported in consolidated statements of income $ 633,453

(3) For the year ended December 31, 2022, there were no allowance for credit losses, loans, or accrued interest to be capitalized balances that were individually evaluated for impairment.

(4) 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.

2021 Form 10-K — SLM CORPORATION F-39

(5) Accrued interest to be capitalized on loans in repayment includes interest on loans that are in repayment but have not yet entered into full principal and interest repayment status after any applicable grace period (but, for purposes of the table, does not include the interest on those loans while they are in forbearance).

F-37 SLM CORPORATION — 2022 Form 10-K

Allowance for Credit Losses (Continued)

2 unchanged sentences

Loans Private Education

Loans Personal

Loans Credit Cards Total

1 unchanged sentence

Beginning balance $ 4,378 $ 1,355,844 $ 1,501 $ 1,361,723

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)

9 unchanged sentences

Net charge-offs ( 321 ) ( 200,097 ) ( 344 ) ( 200,762 )

Loan sales — — ( 108,534 ) — ( 108,534 )

Ending Balance $ 4,077 $ 1,158,977 $ 2,281 $ 1,165,335

7 unchanged sentences

collectively evaluated for impairment $ 695,216 $ 19,659,198 $ 25,014 $ 20,379,428

Accrued interest to be capitalized:

Ending balance:

individually evaluated for impairment $ — $ — $ — $ —

Ending balance:

collectively evaluated for impairment $ — $ 947,391 $ — $ 947,391

Net charge-offs as a percentage of average loans in repayment (3)

0.06 % 1.33 % 2.24 %

Allowance as a percentage of the ending total loan balance 0.59 % 6.87 % — % 12.27 %

Allowance as a percentage of the ending loans in repayment (3)

Allowance as a percentage of the ending total loan balance and accrued interest to be capitalized 0.59 % 5.35 % 9.12 %

Allowance as a percentage of the ending loans in repayment and accrued interest to be capitalized on loans in repayment (3)

0.74 % 7.32 % 9.12 %

5 unchanged sentences

$ 553,980 $ 15,511,212 $ 25,014

Accrued interest to be capitalized on loans in repayment (4)

$ — $ 312,537 $ —

(1) See Note 8, “Unfunded Loan Commitments,” for a summary of the activity in the allowance for and balance of unfunded loan commitments, respectively.

2 unchanged sentences

When the loan is funded, we transfer that liability to the allowance for credit losses.

F-40 SLM CORPORATION — 2021 Form 10-K

Allowance for Credit Losses (Continued)

Consolidated Statements of Income

6 unchanged sentences

Other impacts to the provisions for credit losses:

Personal Loans ( 2,431 )

FFELP Loans 20

Credit Cards 1,124

Total ( 691 )

Provisions for credit losses reported in consolidated statements of income $ ( 32,957 )

(4) Accrued interest to be capitalized on loans in repayment includes interest on loans that are in repayment but have not yet entered into full principal and interest repayment status after any applicable grace period (but, for purposes of the table, does not include interest on those loans while they are in forbearance).

2022 Form 10-K — SLM CORPORATION F- 38

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Loans Personal

Loans Credit Cards Total

Allowance for Credit Losses

Beginning balance $ 1,633 $ 374,300 $ 65,877 $ 102 $ 441,912

Total provision 1,478 279,570 72,783 103 353,934

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)

— 320,808 — — 320,808

Provision for current period 412 148,673 40,485 1,328 190,898

Loan sale reduction to provision — ( 161,793 ) ( 42,916 ) — ( 204,709 )

Loans transferred to held-for-sale — ( 205,669 ) — — ( 205,669 )

Total provisions (2)

412 ( 218,789 ) ( 2,431 ) 1,328 ( 219,480 )

Net charge-offs:

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Net charge-offs ( 519 ) ( 181,305 ) ( 34,095 ) ( 117 ) ( 216,036 )

Loan sales — — ( 108,534 ) — ( 108,534 )

Ending Balance $ 4,378 $ 1,355,844 $ — $ 1,501 $ 1,361,723

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collectively evaluated for impairment $ 737,593 $ 18,454,747 $ — $ 12,238 $ 19,204,578

Accrued interest to be capitalized:

Ending balance:

individually evaluated for impairment $ — $ — $ — $ — $ —

Ending balance:

collectively evaluated for impairment $ — $ 973,201 $ — $ — $ 973,201

Net charge-offs as a percentage of average loans in repayment (3)

0.09 % 1.17 % — % 1.26 %

Allowance as a percentage of the ending total loan balance 0.21 % 1.61 % 6.28 % 2.63 %

Allowance as a percentage of the ending loans in repayment (1)

Allowance as a percentage of the ending total loan balance and accrued interest to be capitalized 0.59 % 6.55 % — % 12.27 %

Allowance as a percentage of the ending loans in repayment and accrued interest to be capitalized on loans in repayment (3)

0.76 % 9.28 % — % 12.27 %

5 unchanged sentences

$ 573,361 $ 14,304,821 $ — $ 12,238

Accrued interest to be capitalized on loans in repayment (4)

$ — $ 308,655 $ — $ —

(1) See Note 8, “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

Provisions for Credit Losses Reconciliation

Year Ended December 31, 2020 (dollars in thousands)

Private Education Loan provisions for credit losses:

Provisions for loan losses $ ( 218,789 )

Provisions for unfunded loan commitments 312,613

Total Private Education Loan provisions for credit losses 93,824

Other impacts to the provisions for credit losses:

Personal Loans ( 2,431 )

FFELP Loans 412

Credit Cards 1,328

Total ( 691 )

Provisions for credit losses reported in consolidated statements of income $ 93,133

(4) Accrued interest to be capitalized on loans in repayment includes interest on loans that are in repayment but have not yet entered into full principal and interest payment status after any applicable grace period (but, for purposes of the table, do not include those loans while they are in forbearance).

F-39 SLM CORPORATION — 2022 Form 10-K

Allowance for Credit Losses (Continued)

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.

Private Education Loans Allowance for Credit Losses - Forecast Assumptions

In the fourth quarter of 2022, we changed our loss model to include forecasts of college graduate unemployment, home price index, and median family income in determining the adequacy of the allowance for credit losses.

Prior to this change, we used forecasts of college graduate unemployment and the Consumer Price Index in our loss forecasting models.

We obtain forecasts for these 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 January 1, 2020 (the initial adoption date of CECL), December 31, 2020, and December 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.

At January 1, 2020 (the initial adoption date of CECL), December 31, 2020, December 31, 2021, and December 31, 2022, 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.

For the year ended December 31, 2021, we had negative total provisions for credit losses of $ 33 million.

This decrease of $ 126 million in 2021 compared with the year-ago period was primarily the result of improving economic forecasts in 2021 and faster prepayment speeds.

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.

In the fourth quarter of 2021, we increased our long-term estimate of prepayment speeds to reflect higher long-term prepayment experience.

Partially offsetting these benefits were additional provisions to reflect the adoption of our credit administration practices changes and other management overlays.

Troubled Debt Restructurings

All of our loans are collectively assessed for impairment, except for loans classified as TDRs (where we conduct individual assessments of impairment).

Provision for credit losses for the year ended December 31, 2022 was $ 633 million, compared with a negative provision of $ 33 million in the year-ago period.

During 2022, the provision for credit losses was primarily affected by new loan commitments made during the period, slower prepayment rates, and additional management overlays, which were partially offset by negative provisions recorded related to $ 3.34 billion in Private Education Loans sold in 2022, and the adoption of a new loss model that included a reduction in the long-term estimate of losses after the reasonable and supportable period.

Management overlays increased in 2022 due to several factors, including additional provisions arising from our expectation of higher future losses related to the previously announced credit administration practices changes we implemented in 2021, “gap year” loans, a shortage and lack of tenured collections staff, and other operational challenges we experienced in 2022.

We expect the lack of tenured collections staff and operational challenges to persist into 2023 and, to a lesser extent, 2024.

“Gap year” loans refer to loans to borrowers who took a “gap year” during the COVID-19 pandemic and entered full principal and interest repayment status starting in late 2021 and early 2022.

Losses on these “gap year” loans were higher than expected and contributed to the higher provision expense recorded in 2022 to cover the higher-than-expected losses.

In the year-ago period, the provision for credit losses was favorably affected by improved economic forecasts in 2021 and faster prepayments speeds.

In addition, 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.

The faster estimated prepayment speeds reflected the significant improvement in economic forecasts as well as the implementation of an updated prepayment speed model in the first quarter of 2021.

Loan Modifications to Borrowers Experiencing Financial Difficulty

The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon asset origination or acquisition.

The starting point for the estimate of the allowance for credit losses is historical information, which includes losses from modifications of receivables whose borrowers are experiencing financial difficulty.

We use a discounted cash flow model to determine the allowance for credit losses.

An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification.

The effect of most modifications of loans made to borrowers who are experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance.

The forecast of expected future cash flows is updated as the loan modifications occur.

We adjust the terms of loans for certain borrowers when we believe such changes will help our customers manage their student loan obligations and achieve better student outcomes, and increase the collectability of the loans.

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.

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At December 31, 2021 and 2020, 7.2 percent and 7.8 percent, respectively, of our Private Education Loans held for investment 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 December 31, 2021 and 2020, approximately 47 percent of TDRs were classified as such due to their forbearance status.

See Note 2, “Significant Accounting Policies — Allowance for Credit Losses” for a more detailed discussion.

Within the Private Education Loan portfolio, loans 90 days or greater past due are nonperforming.

Within the Private Education Loan portfolio, we deem loans greater than 90 days past due as 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 December 31, 2021 and 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.

Years Ended December 31,

(dollars in thousands) Recorded Investment Unpaid Principal Balance Allowance

TDR Loans $ 1,093,387 $ 1,057,665 $ 47,712

TDR Loans $ 1,312,805 $ 1,274,590 $ 104,265

2022 Form 10-K — SLM CORPORATION F- 40

Allowance for Credit Losses (Continued)

The following table provides the average recorded investment and interest income recognized for our TDR loans.

Years Ended December 31, (dollars in thousands) 2021 2020 2019

Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized

TDR Loans $ 1,220,739 $ 84,822 $ 1,546,908 $ 100,125 $ 1,434,137 $ 95,507

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 from what we reported in our 2020 Form 10-K to conform with the delinquency bucket periods defined by the Federal Financial Institutions Examination Council (“FFIEC”).

As of December 31,

(dollars in thousands) Balance % Balance %

TDR loans in in-school/grace/deferment (1)

$ 80,281 $ 88,750

TDR loans in forbearance (2)

41,464 76,704

TDR loans in repayment (3) and percentage of each status:

Loans current 832,018 88.9 % 971,880 87.7 %

Loans delinquent 30-59 days (4)

48,766 5.2 59,249 5.3

Loans delinquent 60-89 days (4)

30,575 3.3 43,576 3.9

Loans 90 days or greater past due (4)

24,561 2.6 34,431 3.1

Total TDR loans in repayment (3)

935,920 100.0 % 1,109,136 100.0 %

Total TDR loans, gross $ 1,057,665 $ 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.

For additional information, see Note 2, “Significant Accounting Policies —Allowance for Credit Losses.”

Under our current forbearance practices, temporary forbearance of payments is generally granted in one -to- two month increments, for up to 12 months over the life of the loan, with 12 months of positive payment performance by a borrower required between grants (meaning the borrower must make payment in a cumulative amount equivalent to 12 monthly required payments under the loan).

See Note 5, “Loans Held for Investment — Certain Collection Tools - Private Education Loans.” In the first quarter of 2022, we adopted ASU No.

2022-02 (see Note 2, “Significant Accounting Policies”).

Under this new amendment, if the debt has been previously restructured, an entity must consider the cumulative effect of past restructurings made within the 12-month period before the current restructuring when determining whether a delay in payment resulting from the current restructuring is insignificant.

Due to our current forbearance practices, including the limitations on forbearances offered to borrowers, we do not believe the granting of forbearances will exceed the significance threshold and, therefore, we do not consider the forbearances as loan modifications.

The limitations on granting of forbearances described above apply to hardship forbearances.

We offer other administrative forbearances (e.g., death and disability, bankruptcy, military service, disaster forbearance, and in school assistance) that are either required by law (such as by the Servicemembers Civil Relief Act) or are considered separate from our active loss mitigation programs and therefore are not considered to be loan modifications requiring disclosure under ASU No.

In addition, we may offer on a limited basis term extensions or rate reductions or a combination of both to borrowers to reduce consolidation activities.

For purposes of this disclosure, we do not consider them modifications of loans to borrowers experiencing financial difficulty and they therefore are not included in the tables below.

The following table shows the amortized cost basis at the end of the reporting period of the loans to borrowers experiencing financial difficulty that were modified during the period from January 1, 2022 (the effective date of our adoption of ASU No.

2022-02) through the end of the reporting period, disaggregated by class of financing receivable and type of modification.

When we approve a Private Education Loan at the beginning of an academic year, we do not always disburse the full amount of the loan at the time of 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 consider borrowers to be in financial difficulty after they have exited school and have difficulty making their scheduled principal and interest payments.

Loan Modifications Made to Borrowers Experiencing Financial Difficulty

Year Ended December 31, 2022

(dollars in thousands) Interest Rate Reduction Combination - Interest Rate Reduction and Term Extension

Amortized Cost Basis % of Total Class of Financing Receivable Amortized Cost Basis % of Total Class of Financing Receivable

Private Education Loans $ 30,569 0.14 % $ 295,547 1.37 %

Total $ 30,569 0.14 % $ 295,547 1.37 %

The following table describes the financial effect of the modifications made to loans whose borrowers are experiencing financial difficulty:

Year Ended December 31, 2022

Interest Rate Reduction Combination - Interest Rate

Reduction and Term Extension

Loan Type Financial Effect Loan Type Financial Effect

Private Education Loans Reduced average contractual rate from 11.12 % to 4.00 %

Private Education Loans Added a weighted average 10.40 years to the life of loans

Reduced average contractual rate from 10.57 % to 4.00 %

Private Education Loans are charged off at the end of the month in which they reach 120 days delinquent or otherwise when the loans are classified as a loss by us or our regulator.

Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

F-41 SLM CORPORATION — 2022 Form 10-K

Allowance for Credit Losses (Continued)

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.

Years Ended December 31, (dollars in thousands) 2021 2020 2019

Modified Loans (1)

Charge-offs Payment-Default Modified Loans (1)

Charge-offs Payment-Default

TDR Loans $ 7,410 $ 64,682 $ 9,626 $ 207,001 $ 71,267 $ 75,153 $ 515,398 $ 74,137 $ 111,810

(1) Represents the principal balance of loans that have been modified during the period and resulted in a TDR.

“Significant Accounting Policies — Allowance for Credit Losses — Allowance for Private Education Loan Losses, and — Allowance for FFELP Loan Losses” in this Form 10-K for a more detailed discussion.

The following table provides the amount of financing receivables whose borrowers were experiencing financial difficulty and had a payment default and were modified during the period from January 1, 2022 (the effective date of our adoption of ASU No.

2022-02) through the end of the reporting period.

We define payment default as 60 days past due for purposes of this disclosure.

Year Ended December 31, 2022 (dollars in thousands) Modified Loans (1)(2)

Payment Default

Private Education Loans $ 22,925 $ 22,621

Total $ 22,925 $ 22,621

(1) Represents amortized cost basis of loans that have been modified.

(2) For the year ended December 31, 2022, the modified loans include $ 20.6 million of interest rate reduction and term extension loan modifications and $ 2.3 million of interest rate reduction only loan modifications.

We closely monitor performance of the loans to borrowers experiencing financial difficulty that are modified to understand the effectiveness of the modification efforts.

The following table depicts the performance of loans that have been modified during the period from January 1, 2022 (the effective date of our adoption of ASU No.

2022-02) through the end of the reporting period.

Payment Status (Amortized Cost Basis)

At December 31, 2022

(dollars in thousands) Deferment (1)

Current (2)(3)

Past Due (2)(3)

90 Days or Greater

Past Due (2)(3)

Private Education Loans $ 7,698 $ 289,134 $ 13,859 $ 8,809 $ 6,616 $ 326,116

Total $ 7,698 $ 289,134 $ 13,859 $ 8,809 $ 6,616 $ 326,116

(1) Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make full principal and interest payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation).

Deferment also includes loans that have entered a forbearance after the loan modification was granted.

(2) Loans in repayment include loans on which borrowers are making full principal and interest payments after any applicable grace period (but, for purposes of the table, do not include those loans while they are in forbearance).

(3) The period of delinquency is based on the number of days scheduled payments are contractually past due.

2022 Form 10-K — SLM CORPORATION F- 42

Allowance for Credit Losses (Continued)

Private Education Loans Held for Investment - Key Credit Quality Indicators

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The following tables highlight the gross principal balance of our Private Education Loan portfolio (held for investment), by year of origination, stratified by key credit quality indicators.

2021 Form 10-K — SLM CORPORATION F-45

Allowance for Credit Losses (Continued)

As of December 31, 2022

83 unchanged sentences

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 from what we reported in our 2020 Form 10-K to conform with the delinquency bucket periods defined by the FFIEC.

Private Education Loans Held for Investment - Delinquencies by Origination Vintage

51 unchanged sentences

Loans in forbearance as a percentage of loans in repayment and forbearance 0.5 % 1.9 % 2.1 % 2.3 % 2.5 % 2.1 % 1.9 %

(1) For some students, going back to school in the fall of 2020 was not an option because of the pandemic, or for other reasons.

Therefore, some students took 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 then 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 then 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 then received such extension of time from us to re-enroll before beginning their grace period.

This program ended in September 2021.

27 unchanged sentences

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 of 2020 was not an option because of the pandemic, or for other reasons.

Therefore, some students took a “gap year” before returning to school.

This program ended in September 2021.

(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).

5 unchanged sentences

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 90 days and greater past due as compared to our allowance for uncollectible interest on loans making full interest payments.

The table also discloses the amount of accrued interest on loans 90 days or greater 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.

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, and the current expected credit losses on accrued interest that will be capitalized is included in our allowance for credit losses.

The allowance for uncollectible interest shown below represents the expected losses related to the portion of accrued interest receivable on those loans that are in repayment but have not yet entered into full principal and interest repayment status after any applicable grace period.

The allowance for this portion of interest is included in our allowance for credit losses.

Private Education Loans

1 unchanged sentence

(Dollars in thousands) Total Interest

Receivable 90 Days and Greater

Receivable 90 Days or Greater

Past Due Allowance for

2 unchanged sentences

December 31, 2021 $ 1,187,123 $ 3,635 $ 4,937

(1) The allowance for uncollectible interest at December 31, 2022 and 2021 represents the expected losses related to the portion of accrued interest receivable on those loans that are in repayment (at December 31, 2022 and 2021, relates to $ 240 million and $ 240 million, respectively, of accrued interest receivable that is not expected to be capitalized).

The accrued interest receivable that is expected to be capitalized ($ 937 million and $ 947 million at December 31, 2022 and 2021, respectively) is reserved in the allowance for credit losses.

2022 Form 10-K — SLM CORPORATION F- 48

3 unchanged sentences

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 Note 2, “Significant Accounting Policies — Allowance for Credit Losses, — Allowance for Credit Losses - 2021 and 2020, — Off-Balance Sheet Exposure for Contractual Loan Commitments - 2021 and 2020” for additional information.

See Note 2, “Significant Accounting Policies — Allowance for Credit Losses, — Off-Balance Sheet Exposure for Contractual Loan Commitments” for additional information.

At December 31, 2022, we had $ 2.0 billion of outstanding contractual loan commitments that we expect to fund during the remainder of the 2022/2023 academic year.

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Depreciation expense for premises and equipment was $ 17 million, $ 16 million, and $ 15 million for the years ended December 31, 2022, 2021, and 2020, respectively.

Goodwill and Acquired Intangible Assets

At December 31, 2022 we had $ 51 million in total goodwill.

Acquired Intangible Assets

Our intangible assets include acquired tradename and trademarks, customer relationships, and developed technology.

Acquired intangible assets include the following:

December 31, 2022

(Dollars in thousands) Useful Life

(in years) (1)

Cost Basis Accumulated Amortization Net

Tradename and trademarks 10 $ 68,470 $ ( 5,706 ) $ 62,764

Customer relationships 5 5,670 ( 1,723 ) 3,947

Developed technology 3 1,260 ( 350 ) 910

Total acquired intangible assets $ 75,400 $ ( 7,779 ) $ 67,621

(1) The weighted average useful life of acquired intangible assets related to the Nitro acquisition is 9.51 years.

We recorded amortization of acquired intangible assets totaling approximately $ 8 million in the year ended December 31, 2022.

There was no amortization of acquired intangible assets recorded in the years ended December 31, 2021 and 2020, respectively.

We will continue to amortize our intangible assets with definite useful lives over their remaining estimated useful lives.

We estimate amortization expense associated with these intangible assets will be approximately $ 9 million, $ 8 million, $ 8 million, $ 7 million, and $ 7 million in 2023, 2024, 2025, 2026, and 2027, respectively.

2022 Form 10-K — SLM CORPORATION F- 50

The following table summarizes total deposits at December 31, 2022 and 2021.

11 unchanged sentences

We recognized placement fee expense of $ 13 million, $ 16 million, and $ 19 million in the years ended December 31, 2022, 2021, and 2020, respectively.

Fees paid to third-party brokers related to these CDs were $ 13 million, $ 5 million, and $ 28 million during the years ended December 31, 2021, 2020, and 2019, respectively.

2021 Form 10-K — SLM CORPORATION F-53

Deposits (Continued)

Fees paid to third-party brokers related to brokered CDs were $ 13 million, $ 13 million, and $ 5 million during the years ended December 31, 2022, 2021, and 2020, respectively.

Interest bearing deposits at December 31, 2022 and 2021 are summarized as follows:

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(1) Includes the effect of interest rate swaps in effective hedge relationships.

F-51 SLM CORPORATION — 2022 Form 10-K

Deposits (Continued)

Certificates of deposit remaining maturities are summarized as follows:

10 unchanged sentences

Accrued interest on deposits was $ 59 million and $ 35 million at December 31, 2022 and 2021, respectively.

F-54 SLM CORPORATION — 2021 Form 10-K

Outstanding borrowings consist of unsecured debt and secured borrowings issued through our term ABS program and our Secured Borrowing Facility.

2022 Form 10-K — SLM CORPORATION F- 52

Outstanding borrowings consist of unsecured debt and secured borrowings issued through our term ABS program and our Private Education Loan multi-lender secured borrowing facility (the “Secured Borrowing Facility”).

The issuing entities for those secured borrowings are VIEs and are consolidated for accounting purposes.

15 unchanged sentences

Short-term Borrowings

On July 30, 2021, we amended our Secured Borrowing Facility to extend the maturity of the facility.

Unsecured Debt

On November 15, 2021, we redeemed our $ 200 million, 5.125 percent Senior Notes due April 5, 2022.

The Senior Notes were redeemed at 101.39 percent of their principal amount, plus the accrued and unpaid interest thereon through the redemption date.

As a result of the redemption, we recognized a $ 3 million loss on the transaction.

These Senior Notes redeemed in the fourth quarter of 2021 were classified as short-term borrowings in April of 2021, and are included in the average table below.

At December 31, 2022, and December 31, 2021, there were no borrowings outstanding classified as short-term.

Secured Financings

On May 17, 2022, 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.

3 unchanged sentences

The scheduled amortization period, during which amounts outstanding under the Secured Borrowing Facility must be repaid, ends on May 16, 2024 (or earlier, if certain material adverse events occur).

At December 31, 2021, and December 31, 2020, there were no secured borrowings outstanding under the Secured Borrowing Facility.

At both December 31, 2022 and December 31, 2021, there were no secured borrowings outstanding under the Secured Borrowing Facility.

Short-term borrowings have a remaining term to maturity of one year or less.

2 unchanged sentences

however, we classify advances under our Secured Borrowing Facility as short-term borrowings because it is our intention to repay those advances within one year.

The 5.125 percent unsecured Senior Notes due April 5, 2022, which we redeemed in the fourth quarter of 2021, were classified as short-term borrowings in April of 2021, and are included in the table below.

2021 Form 10-K — SLM CORPORATION F-55

F-53 SLM CORPORATION — 2022 Form 10-K

Borrowings (Continued)

5 unchanged sentences

Short-term borrowings:

Unsecured Debt $ — — % $ 122,396 5.78 %

Secured Borrowing Facility — — — —

Floating-rate borrowings $ — — % $ — — %

Fixed-rate borrowings (1)

Total short-term borrowings $ — — % $ — — %

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Short-term borrowings:

Secured Borrowing Facility $ — — % $ 45,820 24.99 %

Floating-rate borrowings $ — — % $ — — %

Fixed-rate borrowings (1)

— — 122,396 5.78

Total short-term borrowings $ — — % $ 122,396 5.78 %

Maximum outstanding at any month end $ 199,651

(1) The interest for the non-use fees is calculated based on the Secured Borrowing Facility’s maximum borrowing limit, which was $ 2 billion in both 2021 and 2020.

(1) Included in floating-rate borrowings is the Secured Borrowing Facility, which also incurs a non-use fee based upon the facility’s maximum borrowing limit of $ 2 billion, for both 2022 and 2021, which is applied to the unfunded balance.

The facility non-use fee was 45 basis points and 46 basis points in 2022 and 2021, respectively.

Long-term Borrowings

Unsecured Debt

On November 15, 2021, we redeemed our $ 200 million, 5.125 percent Senior Notes due April 5, 2022.

The Senior Notes were redeemed at 101.39 percent of their principal amount, plus the accrued and unpaid interest thereon through the redemption date.

As a result of the redemption, we recognized a $ 3 million loss on the transaction.

On October 29, 2020, we issued at par an unsecured debt offering of $ 500 million of 4.20 percent Senior Notes due October 29, 2025.

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2022 Transactions

On May 19, 2021, we executed our $ 531 million SMB Private Education Loan Trust 2021-B term ABS transaction, which was accounted for as a secured financing.

On August 9, 2022, we executed our $ 575 million SMB Private Education Loan Trust 2022-C term ABS transaction, which was accounted for as a secured financing.

We sold $ 575 million of notes to third parties and retained a 100 percent interest in the residual certificates issued in the securitization, raising approximately $ 575 million of gross proceeds.

The Class A and Class B notes had a weighted average life of 4.26 years and priced at a weighted average LIBOR equivalent cost of 1-month LIBOR plus 0.77 percent.

The Class A and Class B notes had a weighted average life of 4.69 years and priced at a weighted average SOFR equivalent cost of SOFR plus 1.76 percent.

At December 31, 2022, $ 635 million of our Private Education Loans, including $ 597 million of principal and $ 38 million in capitalized interest, were encumbered because of this transaction.

On August 18, 2021, we executed our $ 527 million SMB Private Education Loan Trust 2021-D term ABS transaction, which was accounted for as a secured financing.

2021 Transactions

On May 19, 2021, we executed our $ 531 million SMB Private Education Loan Trust 2021-B term ABS transaction, which was accounted for as a secured financing.

We sold $ 531 million of notes to third parties and retained a 100 percent interest in the residual certificates issued in the securitization, raising approximately $ 529 million of gross proceeds.

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At December 31, 2022, $ 410 million of our Private Education Loans, including $ 389 million of principal and $ 21 million in capitalized interest, were encumbered because of this transaction.

On November 9, 2021, we executed our $ 534 million SMB Private Education Loan Trust 2021-E term ABS transaction, which was accounted for as a secured financing.

On August 18, 2021, we executed our $ 527 million SMB Private Education Loan Trust 2021-D term ABS transaction, which was accounted for as a secured financing.

We sold $ 527 million of notes to third parties and retained a 100 percent interest in the residual certificates issued in the securitization, raising approximately $ 525 million of gross proceeds.

The Class A and Class B notes had a weighted average life of 4.15 years and priced at a weighted average

F-56 SLM CORPORATION — 2021 Form 10-K

The Class A and Class B notes had a weighted average life of 4.22 years and priced at a weighted average LIBOR equivalent

2022 Form 10-K — SLM CORPORATION F- 54

Borrowings (Continued)

LIBOR equivalent cost of 1-month LIBOR plus 0.69 percent.

At December 31, 2021, $ 533 million of our Private Education Loans, including $ 502 million of principal and $ 31 million in capitalized interest, were encumbered because of this transaction.

2020 Transactions

On February 12, 2020, we executed our $ 636 million SMB Private Education Loan Trust 2020-A term ABS transaction, which was accounted for as a secured financing.

We sold $ 636 million of notes to third-parties and retained a 100 percent interest in the residual certificates issued in the securitization, raising approximately $ 634 million of gross proceeds.

The Class A and Class B notes had a weighted average life of 4.18 years and priced at a weighted average LIBOR equivalent cost of 1-month LIBOR plus 0.88 percent.

cost of 1-month LIBOR plus 0.69 percent.

At December 31, 2022, $ 425 million of our Private Education Loans, including $ 403 million of principal and $ 22 million in capitalized interest, were encumbered because of this transaction.

On August 12, 2020, we executed our $ 707 million SMB Private Education Loan Trust 2020-B term ABS transaction, which was accounted for as a secured financing.

On November 9, 2021, we executed our $ 534 million SMB Private Education Loan Trust 2021-E term ABS transaction, which was accounted for as a secured financing.

We sold $ 534 million of notes to third parties and retained a 100 percent interest in the residual certificates issued in the securitization, raising approximately $ 532 million of gross proceeds.

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Interest Rate Average Balance

Long-term borrowings:

Floating-rate borrowings $ 783,765 5.26 % $ 898,002 $ 1,046,857 1.05 % $ 1,073,042

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Total long-term borrowings $ 5,235,114 3.28 % $ 5,469,692 $ 5,930,990 2.37 % $ 5,167,682

2021 Form 10-K — SLM CORPORATION F-57

F-55 SLM CORPORATION — 2022 Form 10-K

Borrowings (Continued)

As of December 31, 2021, the stated maturity and maturity to call date of our brokered deposits and borrowings are summarized below.

As of December 31, 2022, the maturities of our brokered deposits and borrowings are summarized below.

As of December 31, 2022

(dollars in thousands) Stated Maturity (1)

Maturity to Call Date

Brokered Deposits Unsecured Debt Secured Borrowings Total Brokered Deposits Unsecured Debt Secured Borrowings Total

Year of Maturity

(dollars in thousands) Brokered Deposits Unsecured

Debt Secured Borrowings (1)

2023 $ 2,031,404 $ — $ 725,981 $ 2,757,385

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Total $ 7,333,273 $ 988,986 $ 4,246,128 $ 12,568,387

(1) We view our securitization trust debt as long-term based on the contractual maturity dates and projected principal paydowns based on our current estimates regarding loan prepayment speeds.

The projected principal paydowns in year 2022 include $ 718 million related to the securitization trust debt.

F-58 SLM CORPORATION — 2021 Form 10-K

(1) We view our secured borrowings as long-term based on the contractual maturity dates ranging from 2031 to 2053.

However, the actual maturity of our secured borrowings depends on the prepayment speeds of the underlying collateralized loans.

To disclose how we expect this debt to pay down over time, the maturities for our secured borrowings are based on the projected bond principal paydowns using the current estimated loan prepayment speeds.

2022 Form 10-K — SLM CORPORATION F- 56

Borrowings (Continued)

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(Dollars in thousands)

Private Education Loans:

2020-A February 2020 $ 636,000 1-month LIBOR plus 0.88 %

2020-B August 2020 707,000 1-month LIBOR plus 1.30 %

Total notes issued in 2020 $ 1,343,000

Total loan and accrued interest amount securitized at inception in 2020 (2)

2021-B May 2021 $ 531,000 1-month LIBOR plus 0.77 %

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Total loan and accrued interest amount securitized at inception in 2021 (2)

(1) Represents LIBOR equivalent cost of funds for floating and fixed-rate bonds, excluding issuance costs.

2022-C August 2022 575,000 SOFR plus 1.76 %

Total notes issued in 2022 $ 575,000

Total loan and accrued interest amount securitized at inception in 2022 (3)

(1) Represents LIBOR or SOFR equivalent cost of funds for floating and fixed-rate bonds, excluding issuance costs.

(2) At December 31, 2022, $ 1.27 billion of our Private Education Loans, including $ 1.21 billion of principal and $ 66 million in capitalized interest, were encumbered related to the 2021 transactions.

2021 Form 10-K — SLM CORPORATION F-59

(3) At December 31, 2022, $ 635 million of our Private Education Loans, including $ 597 million of principal and $ 38 million in capitalized interest, were encumbered related to the 2022 transactions.

F-57 SLM CORPORATION — 2022 Form 10-K

Borrowings (Continued)

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(1) Other assets primarily represent accrued interest receivable.

F-60 SLM CORPORATION — 2021 Form 10-K

Borrowings (Continued)

Unconsolidated VIEs

Private Education Loan Securitizations

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 quarter of 2020 and the first six months of 2021.

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.

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 five percent of the securities issued by the trusts in order to meet risk retention requirements.

We were not required to consolidate these entities because while as servicer we may have a significant impact on economic performance, the risk of absorbing losses that could be significant is low.

Additionally, we own five percent of the securities issued by the trusts to meet risk retention requirements.

We were not required to consolidate these entities because the fees we receive as the servicer/administrator are commensurate with our responsibility, so the fees are not considered a variable interest.

Additionally, the five percent vertical interest we maintain does not absorb more than an insignificant amount of the VIE’s expected losses, nor do we receive more than an insignificant amount of the VIE’s expected residual returns.

2022-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.

On March 16, 2022, we closed an SMB Private Education Loan Trust 2022-A term ABS transaction (the “2022-A Transaction”), in which an unaffiliated third party sold to the trust approximately $ 973 million of Private Education Loans that the third-party seller previously purchased from us on November 17, 2021.

In the 2022-A Transaction, we were the sponsor, servicer and administrator, and the seller of an additional $ 95 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 2022-A Transaction and we recorded a $ 10 million gain on sale associated with this transaction.

In connection with the 2022-A Transaction settlement, we retained a five percent vertical risk retention interest (i.e., five percent of each class issued in the securitization).

We classified those vertical risk retention interests related to the 2022-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.

2022 Form 10-K — SLM CORPORATION F- 58

Borrowings (Continued)

2022-B Transaction

On May 27, 2022, we closed an SMB Private Education Loan Trust 2022-B term ABS transaction (the “2022-B Transaction”), in which an unaffiliated third party sold to the trust approximately $ 2.0 billion of Private Education Loans that the third-party seller previously purchased from us on April 27, 2022.

In the 2022-B Transaction, we were the sponsor, servicer and administrator, and the seller of an additional $ 107 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 2022-B Transaction and we recorded an $ 11 million gain on sale associated with this transaction.

In connection with the 2022-B Transaction settlement, we retained a five percent vertical risk retention interest (i.e., five percent of each class issued in the securitization).

We classified those vertical risk retention interests related to the 2022-B 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.

2022-D Transaction

On October 19, 2022, we closed an SMB Private Education Loan Trust 2022-D term ABS transaction (the “2022-D Transaction”), in which an unaffiliated third party sold to the trust approximately $ 1.0 billion of Private Education Loans that the third-party seller previously purchased from us on September 15, 2022.

In the 2022-D Transaction, we were the sponsor, servicer and administrator, and the seller of an additional $ 54 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 2022-D Transaction and we recorded a $ 3 million gain on sale associated with this transaction.

In connection with the 2022-D Transaction settlement, we retained a five percent vertical risk retention interest (i.e., five percent of each class issued in the securitization).

We classified those vertical risk retention interests related to the 2022-D 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.

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 an 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.

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2021-C Transaction

On May 27, 2021, we closed an SMB Private Education Loan Trust 2021-C term ABS transaction (the “2021-C Transaction”), in which the unaffiliated third-party sold to the trust approximately $ 505 million of Private Education Loans that the third-party seller previously purchased from us on January 8, 2021.

On May 27, 2021, we closed an SMB Private Education Loan Trust 2021-C term ABS transaction (the “2021-C Transaction”), in which an unaffiliated third party sold to the trust approximately $ 505 million of Private Education Loans that the third-party seller previously purchased from us on January 8, 2021.

In the 2021-C Transaction, we were the sponsor, servicer and administrator, and the seller of an additional $ 27 million of Private Education Loans into the trust.

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(2) Vertical risk retention interest classified as trading investment.

2021 Form 10-K — SLM CORPORATION F-61

F-59 SLM CORPORATION — 2022 Form 10-K

Borrowings (Continued)

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When there is a net negative exposure, we consider our exposure to the counterparty to be zero.

At December 31, 2021 and 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 $ 9 million and $ 43 million, respectively.

F-62 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 60

Derivative Financial Instruments (Continued)

December 31, 2022 and 2021, 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 $ 12 million and $ 9 million, respectively.

Accounting for Derivative Instruments

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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 twelve months, we estimate that $ 13 million will be reclassified as an increase to interest expense.

During the next twelve months, we estimate that $ 44 million will be reclassified as a decrease to interest expense.

Trading Activities

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Trading derivatives also include any hedges that originally received hedge accounting treatment, but lost hedge accounting treatment due to failed effectiveness testing, as well as the activity of certain derivatives prior to those derivatives receiving hedge accounting treatment.

2021 Form 10-K — SLM CORPORATION F-63

F-61 SLM CORPORATION — 2022 Form 10-K

Derivative Financial Instruments (Continued)

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Net total notional $ 1,314,660 $ 1,438,144 $ 1,528,186 $ 3,915,999 $ — $ 1,235,713 $ 2,842,846 $ 6,589,856

F-64 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 62

Derivative Financial Instruments (Continued)

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Total $ 19,698 $ 41,801 $ 66,164

2021 Form 10-K — SLM CORPORATION F-65

F-63 SLM CORPORATION — 2022 Form 10-K

Derivative Financial Instruments (Continued)

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In the year ended December 31, 2022, we paid a total common stock dividend of $ 0.44 per common share.

In both years ended December 31, 2020 and 2019, we paid a total common stock dividend of $ 0.12 per common share, respectively.

In the year ended December 31, 2021, we paid a total common stock dividend of $ 0.20 per common share.

In the year ended December 31, 2020, we paid a total common stock dividend of $ 0.12 per common share.

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

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In particular, the Bank is subject to laws and regulations that authorize regulatory bodies to block or reduce the flow of funds to us, or that prohibit such transfers altogether in certain circumstances.

These laws, regulations, and rules may hinder our ability to access funds that we may need to make payments in respect of our stock or to satisfy our other responsibilities.

The FDIC has the authority to prohibit or limit the payment of dividends by the Bank and SLM Corporation.

F-66 SLM CORPORATION — 2021 Form 10-K

These laws, regulations, and rules may hinder our ability to access funds

2022 Form 10-K — SLM CORPORATION F- 64

Stockholders’ Equity (Continued)

that we may need to make payments in respect of our stock or to satisfy our other responsibilities.

The FDIC has the authority to prohibit or limit the payment of dividends by the Bank and SLM Corporation.

Share Repurchases

The January 23, 2019 share repurchase program (the “2019 Share Repurchase Program”), which was effective upon announcement and expired on January 22, 2021, 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 have utilized all capacity under our 2019 Share Repurchase Program, having repurchased 17 million shares of common stock for $ 167 million in the year ended December 31, 2019 and 3 million shares of common stock for $ 33 million in the year ended December 31, 2020.

On January 22, 2020, we announced another share repurchase program (the “2020 Share Repurchase Program”), which was effective upon announcement and 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.

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

On January 22, 2020, we announced another share repurchase program (the “2020 Share Repurchase Program”), which was effective upon announcement and expired on January 21, 2022, and permitted us to repurchase shares of common stock from time to time 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.

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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 another share repurchase program (the “2021 Share Repurchase Program”), which was effective upon announcement and expires on January 26, 2023, and originally permitted 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 October 20 2021, we announced a $ 250 million increase in the amount of common stock that may be repurchased under our 2021 Share Repurchase Program, which expires on January 26, 2023.

This is in addition to the original $ 1.25 billion of authorization announced on January 27, 2021, for a total 2021 Share Repurchase Program authorization of $ 1.5 billion.

We have utilized all capacity under the 2020 Share Repurchase Program.

On January 27, 2021, we announced another share repurchase program (the “2021 Share Repurchase Program”), which was effective upon announcement and expired on January 26, 2023, and originally permitted 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 October 20, 2021, we announced a $ 250 million increase in the amount of common stock that may be repurchased under our 2021 Share Repurchase Program, which expired on January 26, 2023.

This was in addition to the original $ 1.25 billion of authorization announced on January 27, 2021, for a total 2021 Share Repurchase Program authorization of $ 1.5 billion.

Of the total $ 1.5 billion 2021 Share Repurchase Program authorization, we repurchased 81.1 million shares of common stock for $ 1.46 billion in the year ended December 31, 2021.

(Those amounts include the shares repurchased under the Tender Offer described below.) There was $ 38 million of capacity remaining under the 2021 Share Repurchase Program at December 31, 2021.

(Those amounts include the shares repurchased under the Tender Offer described below.) We also repurchased 2.0 million shares of common stock under the 2021 Share Repurchase Program for $ 38 million in the three months ended March 31, 2022.

We have utilized all capacity under the 2021 Share Repurchase Program.

On January 26, 2022, we announced a new share repurchase program (the “2022 Share Repurchase Program”), which was effective upon announcement and expires on January 25, 2024, 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 2022 Share Repurchase Program, we repurchased 38.2 million shares of common stock at an average price per share of $ 17.52 , for $ 669 million in the year ended December 31, 2022.

There was $ 581 million of capacity remaining under the 2022 Share Repurchase Program at December 31, 2022.

So long as there is unexpired capacity under a given repurchase program, repurchases under the 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 and the 2022 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 the programs or at all.

The timing and volume of any repurchases under the 2022 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 the program or at all.

Common Stock Tender Offer

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We cancelled the 28.5 million shares purchased in connection with the Tender Offer.

F-65 SLM CORPORATION — 2022 Form 10-K

Stockholders’ Equity (Continued)

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 Plans

During the year ended December 31, 2021, we repurchased 57 million shares of our common stock at a total cost of $ 1.1 billion under Rule 10b5-1 trading plans authorized under our share repurchase programs.

2021 Form 10-K — SLM CORPORATION F-67

Stockholders’ Equity (Continued)

During the years ended December 31, 2022 and 2021, we repurchased 40 million and 57 million shares, respectively, of our common stock at a total cost of $ 708 million and $ 1.1 billion, respectively, under Rule 10b5-1 trading plans authorized under our share repurchase programs.

The following table summarizes our common share repurchases and issuances associated with these programs.

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(1) Common shares purchased under our share repurchase programs.

We have utilized all capacity under our 2021 Share Repurchase Program.

There was $ 581 million of capacity remaining under the 2022 Share Repurchase Program at December 31, 2022.

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The closing price of our common stock on the NASDAQ Global Select Market on December 30, 2022 was $ 16.60 .

F-68 SLM CORPORATION — 2021 Form 10-K

2022 Form 10-K — SLM CORPORATION F- 66

Earnings per Common Share

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(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) For the years ended December 31, 2021, 2020, and 2019, securities covering 1 million shares, no shares and no shares, respectively, were outstanding but not included in the computation of diluted earnings per share because they were anti-dilutive.

2021 Form 10-K — SLM CORPORATION F-69

(2) For the years ended December 31, 2022, 2021, and 2020, securities covering approximately 1 million shares, 1 million shares, and no shares, respectively, were outstanding but not included in the computation of diluted earnings per share because they were anti-dilutive.

F-67 SLM CORPORATION — 2022 Form 10-K

Stock-Based Compensation Plans and Arrangements

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Stock Options

There were no stock options granted in the years ended December 31, 2020 and 2019.

There were no stock options granted in the year ended December 31, 2020.

There were 998,891 time-vested options granted in the year ended December 31, 2021.

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The risk-free interest rate assumption is based on observed interest rates consistent with the expected life of each stock option grant.

F-70 SLM CORPORATION — 2021 Form 10-K

There were 86,536 time-vested options granted in the year ended December 31, 2022.

The options were granted to team members of an acquisition that took place in the first half of the year in 2022.

The exercise price of the options is equal to 100 percent of the fair market value of a share of our common stock as of the grant date.

The options will vest 100 percent on the third anniversary of the respective grant date and expire ten years after the respective grant date.

The fair value of each stock option grant was estimated on the date of grant using a Black-Scholes option pricing model.

The expected volatility of our common stock at the date of grant is estimated based on a historic volatility rate and the expected option life is calculated based on historical stock option experience as the best estimate of future exercise patterns.

The dividend yield assumption is based on historical and anticipated dividend payouts.

The risk-free interest rate assumption is based on observed interest rates consistent with the expected life of each stock option grant.

2022 Form 10-K — SLM CORPORATION F- 68

Stock-Based Compensation Plans and Arrangements (Continued)

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Exercised (2)

( 236,275 ) 5.24

Canceled ( 19,230 ) 16.73

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(1) The aggregate intrinsic value represents the total intrinsic value (the aggregate difference between our closing stock price on December 31, 2022 and the exercise price of in-the-money options) that would have been received by the option holders if all in-the-money options had been exercised on December 31, 2022.

(2) The total intrinsic value of options exercised was $ 2 million, $ 3 million, and $ 4 million for the years ended December 31, 2021, 2020, and 2019, respectively.

(3) No cash was received from option exercises for the year ended December 31, 2021.

The actual tax benefit realized for the tax deductions from option exercises totaled less than $ 1 million for the year ended December 31, 2021.

(2) No options were exercised in the year ended December 31, 2022.

The total intrinsic value of options exercised was $ 2 million and $ 3 million for the years ended December 31, 2021 and 2020, respectively.

(3) For net-settled options, gross number is reflected.

2021 Form 10-K — SLM CORPORATION F-71

Stock-Based Compensation Plans and Arrangements (Continued)

Restricted Stock

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( 49,180 ) 20.33

Canceled ( 4,918 ) 20.33

Non-vested at December 31, 2022 (2)

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These are level 1 valuations.

2021 Form 10-K — SLM CORPORATION F-75

Fair Value Measurements (Continued)

Investments classified as trading are carried at fair value in the consolidated financial statements.

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As such, these are level 2 valuations.

2022 Form 10-K — SLM CORPORATION F- 72

Fair Value Measurements (Continued)

Loans Held For Investment and Accrued Interest Receivable

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This is a level 1 valuation.

F-76 SLM CORPORATION — 2021 Form 10-K

Fair Value Measurements (Continued)

Borrowings are accounted for at cost in the consolidated financial statements.

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When determining the fair value of derivatives, we take into account counterparty credit risk for positions where we are exposed to the counterparty on a net basis by assessing exposure net of collateral held.

When the counterparty has exposure to us under derivative contracts with the Company, we fully collateralize the exposure (subject to certain thresholds).

Interest rate swaps are valued using a standard derivative cash flow model with a LIBOR swap yield curve, which is an observable input from an active market.

When the counterparty has

F-73 SLM CORPORATION — 2022 Form 10-K

Fair Value Measurements (Continued)

exposure to us under derivative contracts with the Company, we fully collateralize the exposure (subject to certain thresholds).

Interest rate swaps are valued using a standard derivative cash flow model with a SOFR swap yield curve, which is an observable input from an active market.

These derivatives are level 2 fair value estimates in the hierarchy.

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We also entered into various other ancillary agreements with Navient to effect the Spin-Off and provide a framework for our relationship with Navient thereafter, such as a transition services agreement, a tax sharing agreement, an employee matters agreement, a loan servicing and administration agreement, a joint marketing agreement, a key services agreement, a data sharing agreement, and a master sublease agreement.

The majority of these agreements were transitional in nature with most having terms that have expired or will expire within the next year.

The majority of these agreements were transitional in nature with most having terms that have expired.

In the case of the loan servicing and administration agreement for those FFELP Loans that we hold and Navient services for us, the agreement is scheduled to expire or be renewed by the end of 2026.

We continue to have exposure to risks related to Navient’s creditworthiness.

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For additional information regarding the Separation and Distribution Agreement and the other ancillary agreements, see our Current Report on Form 8-K filed on May 2, 2014.

2021 Form 10-K — SLM CORPORATION F-77

Arrangements with Navient Corporation (Continued)

Separation and Distribution Agreement

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If for any reason Navient is unable or unwilling to pay claims made against it, our costs, operating expenses, cash flows, and financial condition could be materially and adversely affected over time.

2022 Form 10-K — SLM CORPORATION F- 74

Arrangements with Navient Corporation (Continued)

Indemnification Obligations

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The loan servicing and administration agreement governs the terms by which Navient provides servicing, administration, and collection services for the Bank’s portfolio of FFELP Loans, as well as servicing history information with respect to Private Education Loans previously serviced by Navient and access to certain promissory notes in Navient’s possession.

The term of the loan servicing and administration agreement has been extended to April 30, 2022.

The data sharing agreement provided us the right to obtain from Navient certain post-Spin-Off performance data relating to Private Education Loans owned or serviced by Navient to support and facilitate ongoing underwriting, originations, forecasting, performance, and reserve analyses.

The term of the data sharing agreement expired on April 29, 2019, however.

The term of the loan servicing and administration agreement has been extended to December 31, 2026.

The tax sharing agreement governs the respective rights, responsibilities, and obligations of us and Navient after the Spin-Off relating to taxes, including with respect to the payment of taxes, the preparation and filing of tax returns, and the conduct of tax contests.

16 unchanged sentences

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.

Under regulations issued by the FDIC and other federal banking agencies, banking organizations that adopt CECL during the 2020 calendar year, including the Bank, may elect 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.

The Bank has elected to use this option.

Under regulations issued by the FDIC and other federal banking agencies, banking organizations that adopted CECL during the 2020 calendar year, including the Bank, could elect 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.

The Bank elected to use this option.

On January 1, 2022, 25 percent of the adjusted transition amounts were phased in for regulatory capital purposes.

The Bank’s January 1, 2020 CECL transition amounts increased our 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.

At December 31, 2022, the adjusted transition amounts that were deferred and are being phased in for regulatory capital purposes are as follows:

Transition Amounts Adjustments for the Year Ended Adjustments for the Year Ended Phase-In Amounts for the Year Ended Remaining Adjusted Transition Amounts to be Phased-In

(Dollars in thousands) January 1, 2020 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2022

Retained earnings $ 952,639 $ ( 57,859 ) $ ( 58,429 ) $ ( 209,088 ) $ 627,263

Allowance for credit losses 1,143,053 ( 55,811 ) ( 49,097 ) ( 259,536 ) 778,609

Liability for unfunded commitments 115,758 ( 2,048 ) ( 9,333 ) ( 26,094 ) 78,283

Deferred tax asset 306,171 — — ( 76,542 ) 229,629

2022 Form 10-K — SLM CORPORATION F- 76

Regulatory Capital (Continued)

The Bank’s required and actual regulatory capital amounts and ratios under U.S.

Basel III are shown in the following table.

The following capital amounts and ratios are based upon the Bank’s average assets and risk-weighted assets, as indicated.

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(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.

(3) For December 31, 2022, the actual amounts and the actual ratios include the adjusted transition amounts discussed above that were phased in at the beginning of 2022.

Bank Dividends

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Generally, under Utah’s industrial bank laws and regulations as well as FDIC regulations, the Bank may pay dividends from its net profits without regulatory approval if, following the payment of the dividend, the Bank’s capital and surplus would not be impaired.

The Bank declared $ 1.4 billion, $ 579 million, and $ 254 million in dividends to the Company for the years ended December 31, 2021, 2020, and 2019, respectively, with the proceeds primarily used to fund the 2021, 2020, and 2019 Share Repurchase Programs and stock dividends.

The Bank declared $ 700 million, $ 1.4 billion, and $ 579 million in dividends to the Company for the years ended December 31, 2022, 2021, and 2020, respectively, with the proceeds primarily used to fund the 2022, 2021, and 2020 Share Repurchase Programs and stock dividends.

In the future, we expect that the Bank will pay dividends to the Company as may be necessary to enable the Company to pay any declared dividends on its Series B Preferred Stock and common stock and to consummate any common share repurchases by the Company under its repurchase programs.

F-80 SLM CORPORATION — 2021 Form 10-K

Defined Contribution Plans

3 unchanged sentences

For the years ended December 31, 2022, 2021, and 2020, we contributed $ 7 million, $ 7 million, and $ 8 million, respectively, to this plan.

F-77 SLM CORPORATION — 2022 Form 10-K

Commitments, Contingencies and Guarantees

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The CFPB’s complaint asserts Navient’s assumption of these liabilities pursuant to the Separation and Distribution Agreement.

On January 18, 2017, the Illinois Attorney General filed a lawsuit in Illinois state court against Navient - its subsidiaries Navient Solutions, Inc., Pioneer Credit Recovery, Inc., and General Revenue Corporation - and the Bank arising out of the Multi-State Investigation.

On March 20, 2017, the Bank moved to dismiss the Illinois Attorney General action as to the Bank, arguing, among other things, the complaint failed to allege with sufficient particularity or specificity how the Bank was responsible for any of the alleged conduct, most of which predated the Bank’s existence.

On July 10, 2018, the Court granted the Bank’s motion to dismiss without prejudice.

On August 7, 2018, the Illinois Attorney General filed a First Amended Complaint and, on October 9, 2018, the Bank again moved to dismiss the action based on grounds similar to those raised in its March 20, 2017 motion.

The Illinois Attorney General filed its response on November 21, 2018, and the Bank filed its reply on December 10, 2018.

Oral argument on the motion took place on January 9, 2019.

The Court took the motion under advisement, and a hearing took place on December 7, 2021.

On December 16, 2021, the Court entered an Order granting the Bank’s Motion to Dismiss the First Amended Complaint, thereby dismissing the Bank from the action with prejudice.

On January 13, 2022, Navient announced agreements with a total of forty state attorneys general to resolve their previously disclosed multistate litigation and investigation matters, including but not limited to four lawsuits (brought by the attorneys general for the states of California, Washington, Pennsylvania, and New Jersey) arising out of the Multi-State Investigation.

Neither SLM, the Bank, nor any of their current subsidiaries are named in, or otherwise a party to, the

2021 Form 10-K — SLM CORPORATION F-81

Commitments, Contingencies and Guarantees (Continued)

California, Washington, Pennsylvania, or New Jersey lawsuits, and no claims are asserted against them.

The Company and the Bank are not parties to the Navient settlement and are not contributing any of the relief sought in the settlement.

Further, the consent judgments between Navient and the various states contain releases of claims as to pre-Spin-Off SLM (including the Bank and other consolidated subsidiaries) for conduct occurring on or before the date of the Spin-Off.

Neither SLM, the Bank, nor any of their current subsidiaries were named in, or otherwise a party to, the California, Washington, Pennsylvania, or New Jersey lawsuits, and no claims were asserted against them.

The Company and the Bank were not parties to the Navient settlement and have not contributed any of the relief sought in the settlement.

Further, the consent judgments between Navient and the various states contained releases of claims as to pre-Spin-Off SLM (including the Bank and other consolidated subsidiaries) for conduct occurring on or before the date of the Spin-Off.

Pursuant to the terms of the Separation and Distribution Agreement, and as contemplated by the structure of the Spin-Off, Navient is legally obligated to indemnify the Bank against all claims, actions, damages, losses, or expenses that may arise from the conduct of all activities of pre-Spin-Off SLM occurring prior to the Spin-Off, except for certain liabilities related to the conduct of the pre-Spin-Off consumer banking business that were specifically assumed by the Bank (and as to which the Bank is obligated to indemnify Navient).

Navient has acknowledged its indemnification obligations under the Separation and Distribution Agreement, in connection with the Multi-State Investigation and the related lawsuits in which the Bank has been named as a party.

Navient has informed the Bank, however, that it believes that the Bank may be responsible to indemnify Navient against certain potential liabilities arising from the above-described lawsuits under the Separation and Distribution Agreement and/or a separate loan servicing agreement between the parties, and has suggested that the parties defer further discussion regarding indemnification obligations, and reimbursement of ongoing legal costs, in connection with the lawsuits.

Navient has acknowledged its indemnification obligations under the Separation and Distribution Agreement, in connection with the previously disclosed multistate litigation and investigation matters, as well as related lawsuits in which the Bank had been named as a party.

Navient has informed the Bank, however, that it believes the Bank may be responsible to indemnify Navient against certain potential liabilities arising from the above-described lawsuits under the Separation and Distribution Agreement and/or a separate loan servicing agreement between the parties, and has suggested that the parties defer further discussion regarding indemnification obligations, and reimbursement of ongoing legal costs, in connection with the lawsuits.

The Bank disagrees with Navient’s position and the Bank has reiterated to Navient that Navient is responsible for promptly indemnifying the Bank against all liabilities arising out of the conduct of pre-Spin-Off SLM that are at issue in the Multi-State Investigation and in the above-described lawsuits.

2022 Form 10-K — SLM CORPORATION F- 78

Commitments, Contingencies and Guarantees (Continued)

Contingencies

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State tax, net of federal benefit 4.1 3.1 2.9

Business tax credits ( 0.8 ) ( 2.2 ) ( 3.5 )

Reverse federal impact of indemnification adjustments 0.1 0.2 0.3

Unrecognized tax benefits, U.S.

federal and state, net of federal benefit 0.4 0.7 ( 0.1 )

Business credits ( 1.5 ) ( 0.8 ) ( 2.2 )

Other, net 2.0 1.4 2.0

1 unchanged sentence

The effective tax rate varies from the statutory U.S.

federal rate of 21 percent primarily due to the impact of state taxes, net of federal benefit, for the year ended December 31, 2021;

and due to business tax credits and the impact of state taxes, net of federal benefit, for the year ended December 31, 2020 and 2019, respectively.

federal rate of 21 percent primarily due to business tax credits and the impact of state taxes, net of federal benefit, for the year ended December 31, 2022;

due to the impact of state taxes, net of federal benefit, for the year ended December 31, 2021;

and due to business tax credits and the impact of state taxes, net of federal benefit, for the year ended December 31, 2020.

Income tax expense consists of:

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Loan reserves $ 362,368 $ 300,538

Stock-based compensation plans 10,174 10,914

Deferred revenue 1,318 1,441

Operating loss carryovers 394 83

Accrued expenses not currently deductible 14,307 13,139

Net unrealized losses 30,160 —

Accrued expenses not currently deductible 12,949 14,307

Unrecorded tax benefits 12,916 11,016

Research and development costs 10,929 —

Stock-based compensation plans 9,624 10,174

Operating loss carryovers 300 394

Other 4,618 2,415

1 unchanged sentence

Deferred tax liabilities:

Student loan premiums and discounts, net 14,065 12,396

Fixed assets 9,347 10,131

Acquired intangible assets 8,710 7,767

Market value adjustments on student loans, investments and derivatives 33 5,651

Net unrealized gains 6,459 —

Federal deferred for state receivable 2,111 1,921

Student loan premiums and discounts, net 12,396 11,336

Research and development costs — 8,710

Net unrealized gains — 6,459

Other 397 396

6 unchanged sentences

The valuation allowance is primarily attributable to deferred tax assets for state net operating losses and capital losses that management believes is more likely than not to expire prior to being realized.

Included in net unrealized losses is a valuation allowance of $ 4 million.

The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income of the appropriate character (i.e., capital or ordinary) during the period in which the temporary differences become deductible.

Management considers, among other things, the scheduled reversals of deferred tax liabilities and the history of positive taxable income in evaluating the realizability of the deferred tax assets.

Management believes that it is more likely than not that the results of future operations will generate sufficient taxable income to realize our deferred tax assets (other than state net operating loss and capital loss carryovers as outlined above).

As of December 31, 2022, the state net operating loss carryforwards will begin to expire in 2029 and the capital losses in 2025.

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We do not expect the resolution of open audits to have a material impact on our unrecognized tax benefits.

It is reasonably possible that the uncertain tax position reserve may decrease by as much as $ 6 million during the next 12 months due to the expiration of statutes of limitations, some of which related to indemnified tax liabilities.

It is reasonably possible that the uncertain tax position reserve may decrease by as much as $ 3 million during the next 12 months due to the expiration of statutes of limitations, some of which relate to the indemnified tax liabilities.

The reduction in the uncertain tax position reserve would be reflected as a tax benefit.

24 unchanged sentences

Parent Only Condensed Balance Sheets

At December 31, (dollars in thousands) 2021 2020

At December 31, (dollars in thousands, except share and per share amounts) 2022 2021

Cash and cash equivalents $ 196,820 $ 570,726

Total investments in subsidiaries (primarily Sallie Mae Bank) 2,476,020 2,527,780

Income taxes receivables, net — 1,835

Tax indemnification receivable 2,816 8,047

50 unchanged sentences

Amortization of unsecured debt upfront fees 2,651 2,663 1,029

Amortization of discount on unsecured borrowings 571 — —

Loss on early extinguishment of unsecured debt — 2,784 —

Acquisition related costs 2,603 — —

Gain on sale of Upromise subsidiary, net — — ( 11,331 )

Decrease in investment in subsidiaries, net 34,935 53,698 2,611

(Increase) decrease in investment in subsidiaries, net ( 9,179 ) 34,935 53,698

(Increase) decrease in due from subsidiaries, net 5,124 ( 58,310 ) ( 4,813 )

6 unchanged sentences

Cash flows from investing activities:

Purchase of subsidiary, net of cash acquired ( 127,654 ) — —

Proceeds from the sale of Upromise subsidiary, net — — 16,922

Net cash provided by investing activities — 16,922 —

Net cash (used in) provided by investing activities ( 127,654 ) — 16,922

Cash flows from financing activities:

17 unchanged sentences

Net interest income after provisions for credit losses 276,982 332,263 161,912 84,171

Gains (losses) on sales of loans, net 399,111 3,679 ( 10 ) 145,535

Gains (losses) on derivative and hedging activities, net 28 89 44 ( 17 )

Gains on sales of loans, net 9,881 239,997 74,978 2,894

Gains (losses) on securities, net ( 3,580 ) 667 891 ( 58,245 )

Losses on derivative and hedging activities, net ( 5 ) — — —

Other income 15,629 17,589 19,234 14,708

Total operating expenses 132,006 131,730 149,964 137,762

Total restructuring expenses 1,077 70 108 —

Income tax expense 203,525 53,174 19,392 103,660

Net income 641,207 140,201 72,840 306,265

Acquired intangible assets amortization expense 733 2,417 2,328 2,301

Income tax expense (benefit) 37,356 114,296 29,551 ( 19,492 )

Net income (loss) 128,812 342,073 75,172 ( 77,043 )

Preferred stock dividends 1,275 1,757 2,531 3,466

Net income attributable to SLM Corporation common stock $ 640,006 $ 139,009 $ 71,674 $ 305,088

Basic earnings per common share (1)

Net income (loss) attributable to SLM Corporation common stock $ 127,537 $ 340,316 $ 72,641 $ ( 80,509 )

Basic earnings (loss) per common share (1)

$ 0.46 $ 1.30 $ 0.29 $ ( 0.33 )

Diluted earnings per common share (1)

Diluted earnings (loss) per common share (1)

$ 0.45 $ 1.29 $ 0.29 $ ( 0.33 )

Declared dividends per common share $ 0.11 $ 0.11 $ 0.11 $ 0.11

(1) Basic and diluted earnings per common share attributable to SLM Corporation are computed independently for each of the quarters presented.

Therefore, the sum of quarterly basic and diluted earnings per common share information may not equal annual basic and diluted earnings per common share.

(1) Basic and diluted earnings (loss) per common share attributable to SLM Corporation are computed independently for each of the quarters presented.

Therefore, the sum of quarterly basic and diluted earnings (loss) per common share information may not equal annual basic and diluted earnings (loss) per common share.

F-87 SLM CORPORATION — 2022 Form 10-K

4 unchanged sentences

provisions for credit losses ( 225,767 ) 69,677 138,442 ( 15,309 )

Net interest income (loss) after provisions for credit losses 338,858 ( 3,112 ) 368,207 682,909

Net interest income after provisions for credit losses 556,881 269,107 219,076 382,659

Gains (losses) on sales of loans, net 399,111 3,679 ( 10 ) 145,535

Gains on securities, net 3 37,534 893 666

Gains (losses) on derivative and hedging activities, net 28 89 44 ( 17 )

2 unchanged sentences

Total restructuring expenses 1,077 70 108 —

Income tax expense (benefit) 121,481 ( 30,664 ) 55,189 127,310

Net income (loss) 362,173 ( 85,211 ) 171,028 432,700

Income tax expense 203,525 53,174 19,392 103,660

Net income 641,207 140,201 72,840 306,265

Preferred stock dividends 1,201 1,192 1,166 1,177

Net income (loss) attributable to SLM Corporation common stock $ 358,709 $ ( 87,689 ) $ 168,970 $ 430,966

Basic earnings (loss) per common share (1)

Net income attributable to SLM Corporation common stock $ 640,006 $ 139,009 $ 71,674 $ 305,088

Basic earnings per common share (1)

$ 1.77 $ 0.45 $ 0.24 $ 1.06

Diluted earnings (loss) per common share (1)

Diluted earnings per common share (1)

$ 1.75 $ 0.44 $ 0.24 $ 1.04

3 unchanged sentences

2022 Form 10-K — SLM CORPORATION F- 88

Subsequent Events

On January 26, 2022, we signed a definitive agreement with Epic Research LLC to purchase the assets primarily used or held for use of Epic Research Education Services, LLC, which does business as Nitro College (“Nitro”).

Nitro provides resources that help students and families evaluate how to responsibly pay for college and manage their financial responsibilities after graduation.

Nitro takes pride in equipping college students and their parents with the necessary tools to navigate college financing, manage their debt, and obtain scholarship opportunities.

In addition to providing a scholarship finder, Nitro provides FAFSA application support, information on grants, and calculators to help college students determine the potential return on investment from a college degree.

The addition of Nitro will support the our mission of providing students with the confidence needed to successfully navigate the higher education journey.

Strategically, we expect the acquisition of the Nitro assets, including its employees and intellectual property, when complete, to immediately expand our digital marketing capabilities, reduce the cost to acquire customer accounts, and accelerate our progress to become a broader education solutions provider for students before, during, and immediately after college.

We have had a partnership with Nitro since 2017, and it has been a source of Private Education Loan leads during this period.

The transaction is subject to customary approvals and closing conditions and is expected to close in the first quarter of 2022.

Terms of the purchase are not being disclosed, but the purchase price is not material to the Company.

F-92 SLM CORPORATION — 2021 Form 10-K

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 9A. Controls and Procedures