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Sep 30, 2023
SLM Q3 2023 Earnings Report
Delivered strong results driven by a successful peak season and solid credit performance.
Key Takeaways
Sallie Mae reported strong third-quarter results, driven by a successful peak season and solid credit performance. GAAP net income attributable to common stock was $25 million, or $0.11 per diluted share. Private education loan originations increased 4% year-over-year to $2.5 billion.
GAAP net income of $29 million, down 61% primarily due to $1 billion in private education loan sales in the year-ago period.
Net interest income of $385 million, up 4%.
Private education loan originations of $2.5 billion, up 4%.
Total operating expenses of $167 million, up from $150 million.
Forward Guidance
For 2023, Sallie Mae expects full-year diluted non-GAAP “Core Earnings” per common share of $2.55 - $2.65, full-year Private Education Loan originations year-over-year growth of 6% - 7%, full-year total loan portfolio net charge-offs of $375 million - $385 million, and full-year non-interest expenses of $625 million - $630 million.
Positive Outlook
- Full-year diluted non-GAAP “Core Earnings” per common share of $2.55 - $2.65.
- Full-year Private Education Loan originations year-over-year growth of 6% - 7%.
- The company expects gross charge-offs for full year 2023 to be equal to, or slightly better than, its original 2023 outlook.
- This shift improved our expected long-term recovery rates
- Non-interest expense guidance was updated for higher-than-expected portfolio growth, the impact of investments made during the year, as well as other inflationary pressures.
Challenges Ahead
- Full-year total loan portfolio net charge-offs of $375 million - $385 million.
- Full-year non-interest expenses of $625 million - $630 million.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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