FOR IMMEDIATE RELEASE
SALLIE MAE ACHIEVES HIGHER EARNINGS
FOR FOURTH-QUARTER AND FULL-YEAR 2010 OVER A YEAR AGO
RESTON, Va., Jan. 19, 2011
Sallie Mae (NYSE: SLM), the nations No. 1 financial services company
specializing in education, today announced its fourth-quarter and full-year operating results,
achieving higher earnings and substantially enhancing its liquidity and capital position from one
Sallie Maes core earnings were $401 million ($.75 diluted earnings per share) for the
fourth-quarter 2010, compared to $268 million ($.44 diluted earnings per share) for the year-ago
quarter. These results include the following after-tax items: $74 million of debt repurchase gains,
$27 million of restructuring costs, and $52 million of losses from the discontinuation of the
purchased paper business. The change from the year-ago quarter is driven by decreases in loan loss
provisions and discontinued operations losses, and increases in loan margins, loan sale gains, debt
repurchase gains, and restructuring costs.
For the full-year 2010, core earnings rose to $1.03 billion ($1.92 per diluted share), compared to
$807 million ($1.40 per diluted share) in 2009. The increase from the prior year was primarily
driven by improved federal student loan margins and decreased provisions for loan losses.
On a GAAP basis, fourth-quarter 2010 net income was $447 million ($.84 diluted earnings per share),
vs. $309 million ($.52 diluted earnings per share) in the same quarter last year. For the
full-year 2010, GAAP net income was $530 million ($.94 per diluted share), compared to $324 million
($.38 per diluted share) in 2009.
We entered 2011 financially strong, and ready to serve our customers and bring value to our
shareholders, said Albert L. Lord, vice chairman and CEO.
Funding and Liquidity
During the quarter, the company repurchased $1.3 billion of debt with gains of $118 million
realized. Debt repurchased in 2010 totaled $4.9 billion and generated gains of $317 million.
Subsequent to year end, the company raised $2 billion in senior unsecured debt.
New Reporting Segments
With the elimination of the federally guaranteed student loan origination business last July, the
company updated its reporting to reflect the primary operating segments described below. Management
believes investors value the federally guaranteed loan segment on the cash it generates, and