SLM Corporation Q1 FY2026 earnings call

• Strong Q1 performance driven by loan disbursement funnel strength, with growth potential from federal reforms. - Actively preparing for higher education sector changes, rolled out new offerings. - Underwriting discipline and loss mitigation strategies led to net charge-offs and delinquencies in line with expectations. - Sharpened customer acquisition, enhanced underwriting and credit capabilities. - Efficient cost structure and diversified funding sources support net interest margins. - Accelerated capital return program with loan sales and share repurchases.

Diluted EPS in Q1 was $1.54 per share vs $1.40 in prior year. Loan originations were $2.9 billion, up 5% y-o-y. Net charge-offs were $89 million, consistent with or slightly better than expectations. Net interest income was $375 million, net interest margin 5.29% increased sequentially and y-o-y. Non-interest expenses $171 million vs $155 million y-o-y. Liquidity 21.2% of total assets, total risk-based capital 13.7%, common equity tier one capital 12.4%.

Expect diluted earnings per common share for 2026 to be between $3.10 and $3.20, assuming full utilization of $500 million share repurchase authorization and ~$1 billion incremental loan sales beyond initial plan. Reaffirm other 2026 outlook elements.

Q: Any early color on the additional partnership by year end?

A: Discussions underway with those involved in past process, confident to complete by end of year.

Q: Color on new mods this year and future trends?

A: Entries to mod fluctuate with payment waves, overall loan mods expected to stabilize.

Q: Competitive environment in Grad Plus market?

A: Heightened competition expected, but confident in preparedness.

Q: Loan sale outlook and balancing opportunities?

A: Next partnership to build capacity for grad originations, similar process to first transaction.

Q: FAFSA completion rate up 20% y-o-y?

A: Reflects continued growth in higher education demand, survey to provide more insight.

Q: Cadence of buybacks and capital returns?

A: Benchmark 5%-6% share count reduction, accelerate run sales if market dislocation occurs.