Q2 2025 SLM Corp Earnings Call Transcript
Key Points
- SLM Corp (SLM) delivered solid results in the second quarter of 2025, with GAAP diluted EPS of $0.32 per share.
- The credit quality of originations improved, with a cosigner rate increase to 84% and average FICO at approval rising to 754.
- SLM Corp (SLM) repurchased 2.4 million shares, continuing its capital return strategy and reducing shares outstanding by over 53% since 2020.
- The company agreed on indicative pricing for the sale of $1.8 billion of private education loans, aligning with expectations.
- SLM Corp (SLM) is optimistic about the long-term outlook for private student lending due to recent federal student loan reforms, potentially increasing annual private education loan origination volume by $4.5 billion to $5 billion.
- Loan originations for the second quarter were $686 million, slightly below expectations.
- Provision for credit losses increased to $149 million, attributed to a cautious macroeconomic outlook and an increase in the weighted average life of the portfolio.
- Net private education loan charge-offs rose to $94 million, primarily due to disaster forbearance related to California wildfires.
- Noninterest expenses increased to $167 million, up from $155 million in the prior quarter.
- There is uncertainty regarding the impact of federal lending reforms and reductions in grant funding on future loan originations.
Welcome to the Sallie Mae second-quarter 2025 earnings conference call. (Operator Instructions) I would now like to turn the call over to Kate deLacy, Senior Director and Head of Investor Relations. Please go ahead.
Thank you, [Chloey]. Good evening, and welcome to Sallie Mae's second-quarter 2025 Earnings Call. It is my pleasure to be here today with Jon Witter, our CEO; Pete Graham, our CFO; and Melissa Bernal, Managing Vice President of Strategic Finance.
After the prepared remarks, we will open the call for questions. Before we begin, keep in mind our discussion will contain predictions, expectations and forward-looking statements. Actual results in the future may be materially different from those discussed here due to a variety of factors. Listeners should refer to the discussion of those factors in the company's Form 10-Q and other filings with the SEC.
For Sallie Mae, those factors include, among others, results of operations, financial conditions and/or cash flows
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