What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2025-02-20 compared with 2024-02-22 · 110 added, 180 removed, 292 unchanged (50% of the section changed)

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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.

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, consolidation loan, and business processing businesses.

Navient retained all assets and liabilities generated prior to the Spin-Off other than those explicitly retained by us pursuant to the Separation and Distribution Agreement executed in connection with the Spin-Off (the “Separation and Distribution Agreement”).

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1 “ Education pays, 2023,” Career Outlook , U.S.

Bureau of Labor Statistics, May 2023.

Bureau of Labor Statistics, August 2024.

2 https://research.collegeboard.org/trends/education-pays.

The information contained on, or accessible through, the foregoing website does not constitute a part of, and is not incorporated by reference in, this Annual Report on Form 10-K.

2024 Form 10-K — SLM CORPORATION 5

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We also extend Private Education Loans as an alternative to similar federal education loan products where we believe our rates are competitive.

Private student lending is cyclical in nature.

We typically experience peak volume of originations and commitments in the third quarter of our fiscal year, corresponding to the required timing of disbursements prior to the start of the fall semester at most higher education institutions.

There is generally also a “mini-peak” in volume of originations and commitments in the first quarter of our fiscal year, corresponding to the required timing of disbursements prior to the start of the spring semester at most higher education institutions.

Our primary Private Education Loan product is the Smart Option Student Loan, which emphasizes in-school payment features that can produce shorter terms and reduce customers’ total finance charges.

Customers generally elect one of three Smart Option repayment types at the time of loan origination.

The first two, interest only and fixed payment options, require monthly payments while the student is in school and during the grace period thereafter, and accounted for approximately half of the Private Education Loans the Bank originated during 2023.

Customers elect one of three Smart Option repayment types at the time of loan origination.

The first two, interest only and fixed payment options, require monthly payments while the student is in school and during the grace period thereafter, and accounted for more than half of the Private Education Loans the Bank originated during 2024.

The third repayment option is the more traditional deferred Private Education Loan product where customers are not required to make payments while the student is in school and during the grace period after separation from school.

(The grace period for a Smart Option Student Loan generally runs for six months after the borrower separates from school, but can run for up to 36 months for a small subset of graduate loans.) Lower interest rates on the interest only and fixed payment options encourage customers to elect those options, which help customers reduce their total loan cost compared with the traditional deferred option loan.

Approximately half of our customers elect the in-school repayment option.

The grace period for a Smart Option Student Loan generally runs for six months after the borrower separates from school, and can run for up to 36 months for a small subset of graduate loans.

Lower interest rates on the interest only and fixed payment options encourage customers to elect those options, which help reduce total loan cost compared with the traditional deferred option loan.

Making payments while in school helps customers become accustomed to making on-time regular loan payments.

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These include the Sallie Mae Law School Loan, the Sallie Mae MBA Loan, the Sallie Mae Graduate School Loan for Health Professions, the Sallie Mae Medical School Loan, the Sallie Mae Dental School Loan, and the Sallie Mae Graduate School Loan.

These products were designed to address the specific needs of graduate students, such as extended grace periods for medical students.

These products were designed to address the specific needs of graduate students, such as longer grace periods for medical students.

We also offer two non-cost of attendance loans to support bar study preparation, as well as residency and relocation expenses for medical and dental school students.

We regularly review and update the terms of our Private Education Loan products.

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We manage this risk by underwriting and pricing based on customized credit scoring criteria and the addition of qualified cosigners.

For Private Education Loans originated during the year ended December 31, 2023, our average FICO scores (representing the higher credit scores of the cosigners or borrowers) at the time of original approval were 748, and approximately 87.5 percent of those loans were cosigned.

For Private Education Loans originated during the year ended December 31, 2024, our average FICO scores (representing the higher credit scores of the cosigners or borrowers) at the time of original approval were 752, and approximately 90 percent of

2024 Form 10-K — SLM CORPORATION 6

those loans were cosigned.

In addition, for all loans other than Bar Study loans and Residency and Relocation loans, we require school certification of both the need for, and the amount of, every Private Education Loan we originate (to prevent unnecessary borrowing beyond a school’s cost of attendance), and we disburse the loan proceeds directly to the higher education institutions to ensure loan proceeds are applied directly to the student’s education expenses.

4 SLM CORPORATION — 2023 Form 10-K

The core of our marketing strategy is to promote our products on campuses through financial aid offices as well as through online and direct marketing to students and families.

Our on-campus efforts with approximately 2,100 higher education institutions are actively managed by our relationship management team, the largest in the industry, which has become a trusted resource for financial aid offices.

Our on-campus efforts with more than 2,000 higher education institutions are actively managed by our relationship management team, the largest in the industry, which has become a trusted resource for financial aid offices.

Our loans are high credit quality and the overwhelming majority of our customers manage their payments with great success.

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Sallie Mae Bank

The Bank, which is regulated by the Utah Department of Financial Institutions (the “UDFI”), the FDIC, and the Consumer Financial Protection Bureau (the “CFPB”), offers traditional savings products, such as high-yield savings accounts, money market accounts, and certificates of deposit (“CDs”), originates Private Education Loans, and manages a loan portfolio that also includes loans insured or guaranteed under the previously existing Federal Family Education Loan Program (“FFELP Loans”).

At December 31, 2023, the Bank had total assets of $29.1 billion, including $19.8 billion of Private Education Loans (held for investment), net, and $534 million of FFELP Loans (held for investment), and total deposits of $21.9 billion.

At December 31, 2024, the Bank had total assets of $30.0 billion, including $20.9 billion of Private Education Loans (held for investment), net, and total deposits of $21.5 billion.

Previously, the Bank also owned a portfolio of loans insured or guaranteed under the previously existing Federal Family Education Loan Program (“FFELP Loans”).

In the fourth quarter of 2024, the Bank sold its remaining portfolio of FFELP Loans to an unaffiliated third party.

As of December 31, 2024, the Bank held no FFELP Loans.

Our ability to obtain deposit funding and offer competitive interest rates on deposits will be necessary to sustain our Private Education Loan originations and achieve other business goals.

Our ability to obtain such funding is dependent, in part, on the capital levels of the Bank and its compliance with other applicable regulatory requirements.

At the time of this filing, there are no regulatory restrictions on our ability to obtain deposit funding or the interest rates we offer other than those restrictions generally applicable to all FDIC-insured banks of similar charter and size.

We maintained our diversified funding base by raising $1.1 billion in term funding collateralized by pools of Private Education Loans in the long-term asset-backed securities (“ABS”) market in 2023.

During 2024, we maintained our diversified funding base by raising $2.2 billion in term funding collateralized by pools of Private Education Loans in the long-term asset-backed securities (“ABS”) market.

This brought our total ABS funding outstanding at December 31, 2024 to $5.4 billion, or 26 percent of our total Private Education Loans held for investment portfolio.

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This helps us better match-fund our assets and avoids excessive reliance on deposit funding.

See the subsection titled “Regulation of Sallie Mae Bank” under “Supervision and Regulation” for additional details about the Bank.

Our SmartyPig™ product is a free, FDIC-insured, online, goal-based savings account that helps consumers save for long- and short-term goals.

Its tiered interest rates reward consumers for growing their savings.

At December 31, 2023, we had $329 million in SmartyPig deposits.

In May 2023, we sold our portfolio of credit card loans (“Credit Cards”) to a third party.

This transaction qualified for sale treatment and removed the balance of the loans from our balance sheet on the settlement date.

We recorded a loss of $4 million related to the sale in the second quarter of 2023.

“Business — Supervision and Regulation — Regulation of Sallie Mae Bank” for additional details about the Bank.

2024 Form 10-K — SLM CORPORATION 7

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Explore federal student loans.

Explore federal student loan options by completing the Free Application for Federal Student Aid (“FAFSA”).

Explore federal student loan options by completing the Free Application for Federal Student Aid.

Consider a responsible private student loan.

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We send monthly communications to customers while they are in school, even if they have no monthly payments scheduled, to keep them informed and encourage them to reduce the amount they will owe when they leave school.

Some customers transitioning from school to the work force may require more time before they are financially capable of making full payments of principal and interest.

Sallie Mae created a Graduated Repayment Period program (the “GRP”) to assist borrowers with additional payment flexibility, allowing eligible customers to make interest-only payments instead of full principal and interest payments for a period of 12 months if they elect within a specified time frame to participate in the GRP.

The time frame for electing to participate in the GRP begins six months before expiration of a borrower’s grace period and extends until 12 months after the expiration of the grace period.

The 12-month interest-only payments under the GRP begin upon expiration of a borrower’s grace period or election of the GRP, whichever is later.

Our experience has taught us the successful transition from school to full principal and interest repayment status involves making and carrying out a financial plan.

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Examples are provided to help explain how payments are applied and allocated, and how the accrued interest on alternative repayment programs could affect the cost of customers’ loans.

The site also provides important information on benefits available to servicemembers under the Servicemembers Civil Relief Act (the “SCRA”).

Some customers transitioning from school to the work force may require more time before they are financially capable of making full payments of principal and interest.

Sallie Mae created a Graduated Repayment Period program (“GRP”) to assist borrowers with additional payment flexibility, allowing eligible customers to make interest-only payments instead of full principal and interest payments for a period of 12 months if they elect within a specified time frame to participate in GRP.

Generally, the 12-month interest-only payments under GRP begin upon expiration of a borrower’s grace period or election of GRP, whichever is later.

After graduation, a student borrower may apply for the cosigner to be released from the loan.

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In the event of a cosigner’s death, the student borrower automatically continues as the sole individual on the loan with the same terms.

6 SLM CORPORATION — 2023 Form 10-K

If a customer’s account becomes delinquent, our collection teams work with the customer and/or the cosigner to understand their ability to make ongoing payments.

If the customer is in financial hardship, we work with the customer and/or cosigner and identify any available alternative arrangements designed to reduce monthly payment obligations.

These can include extended repayment schedules, temporary interest rate reductions, in some cases permanent interest rate reductions, and, if appropriate, short-term hardship forbearance.

These arrangements are suited to the customer’s individual circumstances and ability to make payments.

When we grant forbearance, we counsel customers on the effect forbearance will have on their loan balance.

See Part II, Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations — Financial Condition — Allowance for Credit Losses — Use of Forbearance and Rate Modifications as a Private Education Loan Collection Tool” for additional information about our credit administration practices.

If the customer is in financial hardship, we work with the customer and/or cosigner and identify potential alternative arrangements designed to reduce monthly payment

2024 Form 10-K — SLM CORPORATION 8

These can include extended grace periods, short-term hardship forbearances, temporary interest rate reductions, and, in some cases, permanent interest rate reductions.

We offer rate and term modifications to customers experiencing more severe hardship.

These arrangements are intended to address the customer’s individual circumstances and ability to make payments.

When we grant forbearance or modify a loan, we counsel customers on the effect the forbearance or modification will have on their loan balance.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations — Financial Condition — Allowance for Credit Losses — Use of Forbearance and Modifications as a Private Education Loan Collection Tool” for additional information about our credit administration practices.

Customer Service

We perform the origination, servicing, and collections activities for all of our Private Education Loans with dedicated representatives assisting customers with various needs, including the military personnel customers who may be eligible for military benefits.

We perform the origination, servicing, and collections activities for all of our Private Education Loans with dedicated representatives assisting customers with various needs.

We expect the Bank or affiliates of the Bank to retain servicing of all Private Education Loans the Bank originates, regardless of whether the loans are held, sold, or securitized.

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• an integrated platform with customer-centric capabilities that allows self-service and empowers our servicing and collections agents, thus streamlining our processes and providing efficiencies;

• an on-line chat function for application support and customer service related inquires;

• an online chat function for application support and customer service related inquiries;

• a mobile application accessible through smart phones;

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We are strongly invested in our customers’ success.

Of total customers, approximately 96 percent of loans in repayment are in good standing, and, on average, fewer than 3 percent of loans default annually.

Of our total loan portfolio, approximately 96 percent of loans in repayment are in good standing, and, on average, fewer than 3 percent of loans default annually.

In 2022, we acquired the assets of Epic Research Education Services, LLC, which did 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 provided resources that helped students and families evaluate how to responsibly pay for college and manage their financial responsibilities after graduation.

The acquisition of Nitro enhanced future strategic growth opportunities and expanded our digital marketing capabilities, reduced the cost to acquire customer accounts, and accelerated our progress to become a broader education solutions provider helping students to, through, and immediately after higher education.

In 2024, we plan to transition the related Nitro branding to the Sallie and Sallie Mae brands and platforms.

In 2024, we completed the transition of the related Nitro branding to the Sallie and Sallie Mae brands and platforms.

In 2023, we completed the acquisition of several key assets of Scholly, Inc.

(“Scholly”), which is engaged in the business of operating as a scholarship publishing and servicing platform, comprised of websites and mobile application search products that offer custom recommendations for post-secondary scholarships for students, their families, and others as well as related services for scholarship providers.

(“Scholly”), which was engaged in the business of operating as a scholarship publishing and servicing platform, comprised of websites and mobile application search products that offered custom recommendations for post-secondary scholarships for students, their families, and others as well as related services for scholarship providers.

The addition of Scholly assets supports our mission of providing students with the confidence needed to successfully navigate the higher education journey.

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We lend to some students attending two-year and for-profit schools.

Due to the low cost of two-year programs, federal grant and loan programs are typically sufficient for the funding needs of these students.

Approximately 16 percent or $997 million of our 2023 Private Education Loan originations were for students attending for-profit schools.

Due to the lower cost of two-year programs, federal grant and loan programs are typically sufficient for the funding needs of these students.

Approximately 18 percent or $1.31 billion of our 2024 Private Education Loan originations were for students attending for-profit schools.

The for-profit schools where we continue to do business are primarily focused on career training and health care fields.

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Our competitors 1 in the Private Education Loan market include large banks such as Citizens Financial Group, Inc.

and PNC Bank, as well as a number of smaller specialty finance companies such as Sofi Technologies, Inc.

and PNC Bank, as well as a number of specialty finance companies such as Sofi Technologies, Inc.

and College Ave, and members of the Education Finance Council.

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• According to the U.S.

Department of Education’s projections, the enrollment in four-year degree granting institutions is projected to remain relatively flat from 2022 to 2031.

Department of Education’s projections, the enrollment in four-year degree granting institutions is projected to remain relatively flat through 2031.

______________________

Enterval LLC 2023 Q3 Private Student Loan Report, November 2023.

www.enterval.com

Enterval Analytics LLC 2024 Q3 Private Student Loan Report, November 2024.

Department of Education, National Center for Education Statistics, Enrollment in Degree-Granting Institutions Projection Model, through 2031.

These are the most recent sources available to us for this information.

8 SLM CORPORATION — 2023 Form 10-K

2022/2023 is an estimate.

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Tuition Rates

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www.collegeboard.org.

The College Board restates its data annually, which may cause previously reported results to vary.

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Sources of Funding

Private Education Loan originations were an estimated $11 billion in AY 2022-2023, and increase of $1 billion from AY 2021 - 2022.

Private Education Loan originations were an estimated $11.5 billion in AY 2023-2024, an increase of $0.5 billion from AY 2022-2023.

The College Board-Trends in Student Aid 2024© The College Board.

www.collegeboard.org.

Enterval LLC.

www.enterval.com.

Funding sources in current dollars and include federal and private student loan data.

Other sources for the size of the Private Education Loan market exist and may cite the size of the market differently.

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We rely on publicly available sources for market estimates, because we believe it provides a more appropriate basis for comparison of the performance of our business.

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2024 Form 10-K — SLM CORPORATION 12

• We estimate total spending on higher education was $506 billion in AY 2023-2024, up from $465 billion in AY 2019-2020.

Private Education Loan originations increased $2 million from the year-ago period to an estimated $15 billion in AY 2022-2023, and represent just 3.1 percent of total spending on higher education.

Modest growth in total spending can lead to meaningful increases in Private Education Loans in the absence of growth in other sources of funding.

Private Education Loan originations decreased $1 billion from the year-ago period to an estimated $13 billion in AY 2023-2024, and represent just 2.6 percent of total spending on higher education.

• Over the AYs 2019-2024 period, increases in total spending have been absorbed primarily through increased family contributions.

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In doing so, we utilize information from the U.S.

Department of Education, National Center for Education Statistics, Digest of Education Statistics to 2030 (NCES 2023, October 2023), The Integrated Postsecondary Education Data System (IPEDS), College Board -Trends in College Pricing and Student Aid 2023.

Department of Education, National Center for Education Statistics, Digest of Education Statistics to 2031 (NCES 2024, January 2024), The Integrated Postsecondary Education Data System (IPEDS), College Board -Trends in College Pricing and Student Aid 2024.

Other sources for these data points also exist publicly and may vary from our computed estimates.

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Consumer Protection Laws and Regulations

Our origination, servicing, first-party collection, and deposit taking activities subject us to federal and state consumer protection, privacy, and related laws and regulations.

A number of our products and services, including our origination, servicing, first-party collection, deposit taking, and education solutions activities, subject us to federal and state consumer protection, privacy, and related laws and regulations.

Some of the more significant laws and regulations applicable to our business include:

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• the Equal Credit Opportunity Act and Regulation B, which prohibit creditor practices that discriminate on the basis of race, religion, and other prohibited factors in extending credit;

• the SCRA, which applies to all debts incurred prior to commencement of active military service (including education loans) and limits the amount of interest, including fees, that may be charged;

• the Servicemembers Civil Relief Act, which applies to all debts incurred prior to commencement of active military service (including education loans) and limits the amount of interest, including fees, that may be charged;

• the Truth in Savings Act and Regulation DD, which mandate certain disclosures related to consumer deposit accounts;

• the Expedited Funds Availability Act, Check Clearing for the 21st Century Act and Regulation CC issued by the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”), which relate to the availability of deposit funds to consumers;

• the Expedited Funds Availability Act, Check Clearing for the 21st Century Act and Regulation CC issued by the Board of Governors of the Federal Reserve System, which relate to the availability of deposit funds to consumers;

• the Right to Financial Privacy Act, which imposes a duty to maintain the confidentiality of consumer financial records and prescribes procedures for complying with federal government requests for and subpoenas of financial records;

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• the Telephone Consumer Protection Act, which governs communication methods that may be used to contact customers;

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• the Gramm-Leach-Bliley Act, which governs the ability of financial institutions to disclose nonpublic information about consumers to non-affiliated third parties;

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It has authority to prevent unfair, deceptive, or abusive acts and practices by issuing regulations or by using its enforcement authority without first issuing regulations.

The CFPB has been active in its supervision, examination, and enforcement of financial services companies, notably bringing enforcement actions, imposing fines, and mandating large refunds to customers of several large banking institutions.

Under the Biden Administration, the CFPB was active in its supervision, examination, and enforcement of financial services companies, notably bringing enforcement actions, imposing fines, and mandating large refunds to customers of several large banking institutions.

The enforcement and regulatory posture of the CFPB under the Trump Administration is unclear.

The CFPB is the Bank’s primary consumer compliance supervisor with compliance examination authority and primary consumer protection enforcement authority.

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The CFPB continues to take an active interest in the student loan industry, undertaking a number of initiatives related to the private education loan market and student loan servicing.

In early February 2020, the CFPB entered into a Memorandum of Understanding with the U.S.

Department of Education (the “CFPB/DOE MOU”) in order to better serve student loan borrowers.

Under the agreement, the agencies share complaint information from borrowers and meet quarterly to discuss, among other things, the nature of complaints received and available information about the resolution of complaints.

The CFPB and the U.S.

Department of Education share complaint information from borrowers and meet quarterly to discuss, among other things, the nature of complaints received and available information about the resolution of complaints.

Regulation of Sallie Mae Bank

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The federal banking regulators also may remove a director or officer from an insured depository institution (or bar them from the industry) if a violation is willful or reckless.

In May 2014, the Bank received a Civil Investigative Demand (“CID”) from the CFPB as part of the CFPB’s separate investigation relating to customer complaints, fees, and charges assessed in connection with the servicing of student loans and related collection practices of pre-Spin-Off SLM by entities now subsidiaries of Navient during a time period prior to the Spin-Off (the “CFPB Investigation”).

To the extent requested, the Bank has been cooperating fully with the CFPB.

Given the timeframe covered by the CID and the CFPB Investigation, and the focus on practices and procedures previously conducted by Navient and its servicing subsidiaries prior to the Spin-Off, Navient is leading the response to these investigations.

Consequently, we have no basis from which to estimate either the duration or ultimate outcome of this investigation.

We note that on January 18, 2017, the CFPB filed a complaint in federal court in Pennsylvania against Navient, along with its subsidiaries, Navient Solutions, Inc.

and Pioneer Credit Recovery, Inc.

The complaint alleges these Navient entities, among other things, engaged in deceptive practices with respect to their historic servicing and debt collection practices.

Neither SLM, the Bank, nor any of their current subsidiaries are named in, or otherwise a party to, the lawsuit and are not alleged to have engaged in any wrongdoing.

The CFPB’s complaint asserts Navient’s assumption of these liabilities pursuant to the Separation and Distribution Agreement.

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 previously disclosed investigation matters and the now resolved multistate litigation.

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.

Standards for Safety and Soundness

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Under the regulations, if a regulator determines a bank fails to meet any prescribed standards, the regulator may require the bank to submit an acceptable plan to achieve compliance, consistent with deadlines for the submission and review of such safety and soundness compliance plans.

14 SLM CORPORATION — 2023 Form 10-K

Dividends and Share Repurchase Programs

The Bank is chartered under the laws of the State of Utah and its deposits are insured by the FDIC.

The Bank’s ability to pay dividends is subject to the laws of Utah and the regulations of the FDIC.

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The Company may change its common stock dividend policy at any time.

The January 23, 2019 share repurchase program (the “2019 Share Repurchase Program”), which was effective upon announcement and expired on January 22, 2021, permitted the Company to repurchase from time to time shares of its common stock up to an aggregate repurchase price not to exceed $200 million.

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

The January 22, 2020 share repurchase program (the “2020 Share Repurchase Program”), which was effective upon announcement and expired on January 21, 2022, permitted the Company to repurchase shares of its 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.

On March 11, 2020, the third-party financial institution delivered to us approximately 45 million shares.

The final total actual number of shares of common stock delivered to us pursuant to the forward agreement was based upon the Rule 10b-18 volume-weighted average price at which the shares of our common stock traded during the regular trading sessions on the NASDAQ Global Select Market during the term of the ASR.

The transactions were accounted for as equity transactions and were included in treasury stock when the shares were received, at which time there was an immediate reduction in the weighted average common shares calculation for basic and diluted earnings per share.

On January 26, 2021, we completed the ASR and upon final settlement on January 28, 2021, we received an additional 13 million shares.

In total, we repurchased 58 million shares under the ASR at an average price per share of $9.01.

For additional information, see Notes to Consolidated Financial Statements, Note 14, “Stockholders’ Equity.”

Under the 2020 Share Repurchase Program, we repurchased an additional 4 million shares of common stock for $75 million in the three months ended March 31, 2021.

We have utilized all capacity under the 2020 Share Repurchase Program.

On January 27, 2021, the Company announced another share repurchase program (the “2021 Share Repurchase Program”), which was effective upon announcement and expired on January 26, 2023, and originally permitted the Company to repurchase shares of its common stock from time to time up to an aggregate repurchase price not to exceed $1.25 billion.

On February 2, 2021, under the auspices of the 2021 Share Repurchase Program, we announced the commencement of a “modified Dutch Auction” tender offer (the “Tender Offer”) to purchase up to $1 billion in aggregate purchase price of our outstanding shares of common stock, par value $0.20 per share.

Pursuant to the Tender Offer, we repurchased 28.5 million shares at a price of $16.50 per share.

The purchase of shares settled on March 16, 2021, for an aggregate cost of approximately $472 million, including fees and expenses related to the Tender Offer.

We cancelled the 28.5 million shares purchased in connection with the Tender Offer.

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 the Company’s share repurchase programs.

The Bank declared $570 million, $550 million, and $700 million in dividends for the years ended December 31, 2024, 2023, and 2022, respectively, with the proceeds primarily used to fund share repurchase programs and stock dividends.

Our Board of Directors has authorized share repurchase programs during prior years, the most recent of which occurred in January 2024 (for a program of up to $650 million of common stock).

Under the share repurchase programs, purchases take place as and when we determine in open market or private transactions made based upon the market price of our common stock, the nature of other investment opportunities or growth projects, our cash flows from operations, and general economic conditions.

The share repurchase programs do not require us to acquire any specific number of shares, and may be modified, suspended, extended, or terminated by us at any

2024 Form 10-K — SLM CORPORATION 16

In October 2021, our Board of Directors approved a $250 million increase in the amount of common stock that could 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 at an average price per share of $18.07, for $1.46 billion in the year ended December 31, 2021.

(Those amounts include the shares repurchased under the Tender Offer described above.) 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 another share repurchase program (the “2022 Share Repurchase Program”), which was effective upon announcement and expired on January 25, 2024, and 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.

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 and repurchased 22.3 million shares of common stock at an average price per share of $15.64, for $349 million in the year ended December 31, 2023.

There was $236 million of capacity remaining under the 2022 Share Repurchase Program at December 31, 2023.

Any capacity remaining unused under the 2022 Share Repurchase Program on January 25, 2024 expired on that date pursuant to the terms of the 2022 Share Repurchase Program.

On January 24, 2024, we announced a new share repurchase program (the “2024 Share Repurchase Program”), which became effective on January 26, 2024 and expires on February 6, 2026, and permits us to repurchase shares of our common stock from time to time up to an aggregate repurchase price not to exceed $650 million.

Under the 2024 Share Repurchase Program, repurchases may occur from time to time and through a variety of methods, including open market repurchases, repurchases effected through Rule 10b5-1 trading plans, negotiated block purchases, accelerated share repurchase programs, tender offers, or other similar transactions.

The timing and volume of any repurchases will be subject to market conditions, and there can be no guarantee that the Company will repurchase up to the limit of the 2024 Share Repurchase Program or at all.

The Bank declared $550 million, $700 million, and $1.4 billion in dividends for the years ended December 31, 2023, 2022, and 2021, respectively, with the proceeds primarily used to fund share repurchase programs and stock dividends.

We repurchased 11.6 million and 22.3 million shares during the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2024, we had $402 million of capacity remaining under the 2024 Share Repurchase Program (as hereinafter defined).

See Notes to the Consolidated Financial Statements, Note 12, “Stockholders’ Equity” in this Form 10-K for additional information.

Regulatory Capital Requirements

The Bank is subject to various regulatory capital requirements administered by the FDIC and the UDFI.

Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a material adverse effect on our business, results of operations, and financial position.

Under the FDIC’s regulations implementing the Basel III capital framework (“U.S.

Basel III”) and the regulatory framework for prompt corrective action, the Bank must meet specific capital standards that involve quantitative measures of its assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.

The Bank’s capital amounts and its classification under the prompt corrective action framework are also subject to qualitative judgments by the regulators about components of capital, risk weightings, and other factors.

The Bank is subject to the following minimum capital ratios under U.S.

a Common Equity Tier 1 risk-based capital ratio of 4.5 percent, a Tier 1 risk-based capital ratio of 6.0 percent, a Total risk-based capital ratio of 8.0 percent, and a Tier 1 leverage ratio of 4.0 percent.

In addition, the Bank is subject to a Common Equity Tier 1 capital conservation buffer of greater than 2.5 percent.

Failure to maintain the buffer will result in restrictions on the Bank’s ability to make capital distributions, including the payment of dividends, and to pay discretionary bonuses to executive officers.

Including the buffer, the Bank is required to maintain the following capital ratios under U.S.

Basel III in order to avoid such restrictions:

a Common Equity Tier 1 risk-based capital ratio of greater than 7.0 percent, a Tier 1 risk-based capital ratio of greater than 8.5 percent, and a Total risk-based capital ratio of greater than 10.5 percent.

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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.

In July 2023, the federal banking agencies proposed a rule to implement significant changes to the U.S.

Basel III regulatory capital requirements.

The proposed changes to the regulatory capital requirements generally would amend or introduce approaches and methodologies that would apply to banking organizations with total consolidated assets of $100 billion or more or to banking organizations with significant trading activity.

The proposed rule therefore would not affect the Bank’s capital requirements or the calculation of its capital ratios.

Under regulations issued by the FDIC and other federal banking agencies, banking organizations that adopted the current expected credit losses accounting standard (“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.

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

On January 1, 2023, an additional 25 percent of the adjusted transition amounts was phased in for regulatory capital purposes.

On January 1 of 2024 and 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.

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, 2023, the adjusted transition amounts that were deferred and are being phased in for regulatory capital purposes are as follows:

Adjusted Transition Amounts Phase-In Amounts for the Year Ended Phase-In Amounts for the Year Ended Remaining Adjusted Transition Amounts to be Phased-In

(Dollars in thousands) December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2023

Retained earnings $ 836,351 $ (209,088) $ (209,088) $ 418,175

Allowance for credit losses 1,038,145 (259,536) (259,536) 519,073

Liability for unfunded commitments 104,377 (26,094) (26,094) 52,189

Deferred tax asset 306,171 (76,542) (76,542) 153,087

The Bank is subject to various regulatory capital requirements administered by the federal and state banking authorities.

Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material adverse effect on our business, results of operations, and financial condition.

For more information on how the Bank manages its capital position, see Item 7.

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

Stress Testing Requirements

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Deposits at the Bank are insured up to the applicable legal limits by the FDIC-administered Deposit Insurance Fund (the “DIF”), which is funded primarily by quarterly assessments on insured banks.

An insured bank’s

2023 Form 10-K — SLM CORPORATION 17

assessment is calculated by multiplying its assessment rate by its assessment base.

An insured bank’s assessment is calculated by multiplying its assessment rate by its assessment base.

A bank’s assessment base and assessment rate are determined each quarter.

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Undercapitalized insured depository institutions generally may not accept, renew, or roll over brokered deposits.

For more information on the Bank’s deposits, see Part II, Item 7.

For more information on the Bank’s deposits, see Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations — Key Financial Measures — Funding Sources.”

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Any loan by us to the Bank would be subordinate in right of payment to depositors and to certain other indebtedness of the Bank.

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Community Reinvestment Act

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The Bank has received a CRA rating of Outstanding.

The federal banking regulators, as required by the Gramm-Leach-Bliley Act (“GLBA”), have adopted regulations that limit the ability of banks and other financial institutions to disclose nonpublic information about consumers to nonaffiliated third parties.

Data Privacy and Data Security Laws and Regulations

Financial institutions are required to disclose to consumers their policies for collecting and protecting confidential customer information.

Customers generally may prevent financial institutions from sharing nonpublic personal information with nonaffiliated third parties, with some exceptions.

Financial institutions generally may not disclose certain consumer or account information to any nonaffiliated third party for use in telemarketing, direct mail marketing, or other marketing.

Customers generally may prevent financial institutions from sharing nonpublic personal information with unaffiliated third parties, with some exceptions.

Financial institutions generally may not disclose certain consumer or account information to any unaffiliated third party for use in telemarketing, direct mail marketing, or other marketing.

The privacy regulations also restrict information sharing among affiliates for marketing purposes and govern the use and provision of information to consumer reporting agencies.

Federal and state banking agencies have prescribed standards for maintaining the security and confidentiality of consumer information, and the Bank is subject to such standards, as well as certain federal and state laws or standards for notifying consumers in the event of a security breach.

In addition, we must comply with increasingly complex and rigorous data privacy and data security laws and regulatory standards enacted to protect business and personal data.

These laws impose additional obligations on companies regarding the handling of personal data and provide certain individual privacy rights to persons whose data is stored and shared.

Any failure to comply with these laws and regulatory standards could subject us to legal and reputational risk.

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California passed the California Consumer Privacy Act (the “CCPA”), which became effective on January 1, 2020, and the California Privacy Rights Act (the “CPRA”), which expands upon the CCPA and brought additional compliance obligations with respect to certain processing of personal information of California residents once it came into effect in most material respects on January 1, 2023.

Federal and state banking agencies have adopted regulations for maintaining the security and confidentiality of consumer information, and the Bank is subject to such regulations, as well as certain federal and state laws or regulations for notifying consumers in the event of a security breach.

In addition, we must comply with increasingly complex and rigorous data privacy and data security laws and regulations enacted or adopted to protect business and personal information.

These laws and regulations impose additional obligations on companies regarding the handling of personal information and provide certain individual privacy rights to persons whose personal information is stored and shared.

Any failure to comply with these laws and regulations could subject us to legal and reputational risk.

For example, we are subject the rules and regulations promulgated under the authority of the Federal Trade Commission, which regulates unfair or deceptive acts or practices (including with respect to data privacy and data security).

At the state level, California passed the California Consumer Privacy Act (the “CCPA”), which became effective on January 1, 2020, and the California Privacy Rights Act (the “CPRA”), which expands upon the CCPA and brought additional compliance obligations with respect to certain processing of personal information of California residents once it came into effect in most material respects on January 1, 2023.

The CCPA and CCRA apply to for-profit businesses that conduct business in California and meet certain revenue or data collection thresholds.

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However, the definition of personal information is expanded under the California statutes to apply to certain data beyond the scope of the GLBA exemption.

Additionally, numerous other states have enacted or are in the process of enacting state-level data privacy and security laws and regulations relating to the collection, storage, handling, use, disclosure, transfer, security, and other processing of personal information.

Misuse of or failure to secure certain personal information could result in violation of data privacy laws and regulations, proceedings against the Company by governmental entities or others, damage to our reputation and credibility, and could negatively affect our business, financial condition, and results of operations.

Additionally, numerous other states have enacted or are in the process of enacting state-level data privacy and data security laws and regulations relating to the collection, storage, handling, use, disclosure, transfer, security, and other processing of personal information.

Misuse of or failure to secure certain personal information could result in violation of data privacy or data security laws and regulations, proceedings against the Company by governmental entities or others, damage to our reputation and credibility, and could negatively affect our business, financial condition, and results of operations.

If other states in the U.S.

adopt similar laws or if a comprehensive federal data privacy law is enacted, we may expend considerable additional resources to meet these requirements and the overall risk to the Company could incrementally increase depending upon the reach and application of any such laws.

adopt similar laws or if a comprehensive federal data privacy or data security law is enacted, or if regulators whose authority we are subject to adopt additional or amend existing data privacy or data security regulations, we may expend considerable additional resources to meet these requirements and the overall risk to the Company could incrementally increase depending upon the reach and application of any such laws or regulations.

State Regulation of Student Loan Lenders and Servicers

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While these state laws vary in content, they generally include components relating to licensure and oversight by state authorities and the creation of specialized student loan ombudsman offices to oversee the student loan industry operating within these states.

These laws may also include requirements pertaining to payment processing, customer communications, the handling of customer inquiries and complaints, information concerning loan repayment options, access to borrower account records, the processing of disability applications and borrower requests to remove cosigners from loans, and debt collection, among other requirements.

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requirements.

Notably, these laws often include provisions for enforcement of alleged violations by state regulators as well as private litigation by aggrieved consumers.

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Oversight of Derivatives

Title VII of the Dodd-Frank Act requires all standardized derivatives, including most interest rate swaps, to be submitted for clearing to central intermediaries to reduce counterparty risk.

Title VII of the Dodd-Frank Act requires certain standardized derivatives, including most interest rate swaps, to be submitted for clearing to central intermediaries to reduce counterparty risk.

Two of the central intermediaries we use are the Chicago Mercantile Exchange (the “CME”) and the London Clearing House (the “LCH”).

All variation margin payments on derivatives cleared through the CME and LCH are required to be accounted for as legal settlement.

As of December 31, 2023, $1.8 billion notional of our derivative contracts were cleared on the CME and $0.1 billion were cleared on the LCH.

The derivative contracts cleared through the CME and LCH represent 92.6 percent and 7.4 percent, respectively, of our total notional derivative contracts of $1.9 billion at December 31, 2023.

Our exposure is limited to the value of the derivative contracts in a gain position less any collateral held and plus any collateral posted.

As of December 31, 2024, $850 million notional of our derivative contracts were cleared on the CME and $71 million were cleared on the LCH.

The derivative contracts cleared through the CME and LCH represent 92.3 percent and 7.7 percent, respectively, of our total notional derivative contracts of $921 million at December 31, 2024.

Our exposure on these derivative contracts is limited to the value of the derivative contracts in a gain position less any collateral held and plus any collateral posted.

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

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For our 2016-A transaction and subsequent securitizations that are treated as on-balance sheet, we comply with the Dodd-Frank risk retention rules by retaining (for a requisite period of time) an “eligible horizontal residual interest” comprised of residual certificates representing at least five percent of the fair value of all ABS interests issued in the securitization transaction, determined as of the date of transfer.

With any securitizations that are treated as off-balance sheet, including any loan sale transactions structured as securitizations, we comply with the Dodd-Frank risk retention rules by retaining (for a requisite period) an “eligible vertical interest” comprised of a five percent interest in each class of ABS interests issued in any such transaction;

2023 Form 10-K — SLM CORPORATION 19

For any securitizations that are treated as off-balance sheet, including any loan sale transactions structured as securitizations, we comply with the Dodd-Frank risk retention rules by retaining (for a requisite period) an “eligible vertical interest” comprised of a five percent interest in each class of ABS interests issued in any such transaction;

for future off-balance securitizations, we may also comply with the Dodd-Frank risk retention rules by retaining (for a requisite period) a single interest entitling the holder to five percent of any amounts payable by the trustee in respect of each interest issued by the issuing trust.

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The USA PATRIOT Act of 2001 (the “USA Patriot Act”), which amended the Bank Secrecy Act, substantially broadened the scope of United States anti-money laundering laws and regulations by imposing significant new compliance and due diligence obligations, creating new crimes and penalties, and expanding the extra-territorial jurisdiction of the United States.

Treasury Department has issued and, in some cases, proposed a number of regulations that apply various requirements of the USA Patriot Act to financial institutions such as the Bank.

Treasury Department has issued a number of regulations that apply various requirements of the USA Patriot Act to financial institutions such as the Bank.

These regulations impose obligations on financial institutions to maintain appropriate internal policies, procedures, and controls to detect, prevent, and report money laundering and terrorist financing and to verify the identity of their customers.

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law generally prohibits or substantially restricts U.S.

persons from doing business with countries designated by the U.S.

Department of State as state sponsors of terrorism.

law, there are similar prohibitions or restrictions with countries subject to other U.S.

economic sanctions administered by the U.S.

Department of the Treasury’s Office of Foreign Assets Control or other agencies.

persons from doing business with countries and territories that are the subject of comprehensive territorial sanctions designated by the U.S.

Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) or with persons that are the subject of sanctions administered by OFAC or other agencies.

We maintain policies and procedures designed to ensure compliance with relevant U.S.

laws and regulations applicable to U.S.

In December 2013, the U.S.

persons, including the Bank Secrecy Act, as amended, and its implementing regulations and U.S.

economic sanctions.

The “Volcker Rule” provisions of the Dodd-Frank Act are implemented by rules issued by the U.S.

banking agencies, the SEC, and the U.S.

Commodity Futures Trading Commission issued final rules to implement the “Volcker Rule” provisions of the Dodd-Frank Act.

The rules prohibit insured depository institutions and their affiliates from engaging in proprietary trading and from investing in, sponsoring, or having certain financial relationships with, certain private funds.

Commodity Futures Trading Commission that prohibit insured depository institutions and their affiliates from engaging in proprietary trading and from investing in, sponsoring, or having certain financial relationships with, certain private funds.

These prohibitions are subject to a number of important exclusions and exemptions that, for example, permit insured depository institutions and their affiliates to trade for risk-mitigating hedging and liquidity management, subject to certain conditions and restrictions.

The Volcker Rule does not have a meaningful effect on our current operations or those of our subsidiaries, as we do not materially engage in the businesses prohibited by the Volcker Rule.

The Volcker Rule

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does not have a meaningful effect on our current operations or those of our subsidiaries, as we do not materially engage in the businesses prohibited by the Volcker Rule.

Human Capital Resources and Talent Development

We believe in a just and inclusive, values-based, mission-led culture that inspires commitment and drives performance.

We believe in a mission-led culture that inspires commitment and drives performance.

Our human capital strategy is focused on the attraction, development, empowerment, recognition, and rewarding of team members as they bring our mission to life.

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These culture surveys provide insights we use to create an environment in which team members thrive and bring their full selves to work.

We strive to create a diverse culture of inclusion — an environment that encourages and reinforces mutual trust, makes it safe to express thoughts, ideas and concerns, and connects and embraces diverse backgrounds and perspectives to power and fuel our mission.

We believe that a diverse and inclusive workforce can lead to a more effective company.

We strive to create a culture of belonging — an environment that encourages and reinforces mutual trust, makes it safe to express thoughts, ideas and concerns, and connects and embraces all backgrounds and perspectives to power and fuel our mission.

We are focused on providing a total compensation package that enables us to attract, motivate, and retain the best possible talent to help drive our business forward.

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We also provide matching gifts for team members to support their interests and needs and those of their communities.

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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 1. Business