SLM Reports Strong Q2 Performance Amid Federal PLUS Reform
Sallie Mae (NASDAQ: SLM) reported second-quarter earnings of $0.29 per share and highlighted strong early performance following the implementation of Federal PLUS loan reforms. The company noted that new product offerings, including enhancements to medical, dental, law, MBA loans, and a newly launched parent loan, are performing at or above expectations during peak season. Management estimates these changes could lead to an additional $4.5 billion-$5 billion in annual originations over the next several years. Second-quarter originations rose 4.5% year-over-year to $716 million with stable credit quality and improved FICO scores, while cosigner participation remained strong at 84%. Although delinquencies increased slightly from a year ago, management attributed this to seasonal factors rather than broader credit deterioration. Net interest margin declined to 4.75%, but Sallie Mae expects improvement in the second half as liquidity is deployed into peak-season originations. The company also narrowed its net charge-off guidance and continued aggressive share buybacks.
Tickers: $SLM
Topics: education_lending federal_plus_reform originations_growth