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Dec 31, 2019
SLM Q4 2019 Earnings Report
Sallie Mae reported fourth-quarter earnings.
Key Takeaways
Sallie Mae reported a GAAP net income attributable to common stock of $137 million, or $0.32 per diluted share, for the fourth quarter of 2019. The company plans $3 billion of private education loan sales to fund expected $600 million in share repurchases in 2020.
Net interest income increased to $419 million, up 9% from the prior year.
Private education loan originations totaled $717 million, a decrease of 2% from the prior year.
Average private education loans outstanding were $23.2 billion, up 13.8% from the prior year.
Non-GAAP Operating Efficiency Ratio was 33.6%.
Forward Guidance
For 2020, the company expects full-year diluted “Core Earnings” per share of $1.85 - $1.91 and full-year Private Education Loan originations year-over-year growth of 6%.
Positive Outlook
- Full-year diluted “Core Earnings” per share of $1.85 - $1.91
- Full-year provisions for credit losses of $285 million - $305 million
- Full-year total portfolio net charge-offs of $275 million - $285 million
- Full-year Private Education Loan originations year-over-year growth of 6%
- Full-year non-interest expenses of $570 million - $580 million
Challenges Ahead
- Impact of CECL on the provisions for credit losses
- Company discontinued new Personal Loan originations in the fourth quarter of 2019
- Company expects to sell approximately $3 billion in loans in 2020, dependent upon market conditions.
- Company expects to remain well capitalized during the phase-in of regulatory capital following the implementation of CECL
Historical Earnings Impact
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Avg. Return Before/After Earnings
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