Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2011

Allowance for Loan Losses (Tables) [Abstract]

Allowance for Credit Losses and Recorded Investments in Loans


	Allowance for Loan Losses
	Three Months Ended June 30, 2011
				Private Education			Other
	FFELP Loans			Loans			Loans			Total

Allowance for Loan Losses
Beginning balance	$	190,235		$	2,034,318		$	73,797		$	2,298,350
Total provision		22,313			264,938			3,435			290,686
Charge-offs		(20,827	)		(263,580	)		(13,665	)		(298,072	)
Loan sales		(2,697	)		—			—			(2,697	)
Reclassification of interest reserve⁽¹⁾		—			6,927			—			6,927

Ending Balance	$	189,024		$	2,042,603		$	63,567		$	2,295,194

Allowance:
Ending balance: individually evaluated for impairment	$	—		$	133,796		$	52,125		$	185,921
Ending balance: collectively evaluated for impairment	$	189,024		$	1,908,807		$	11,442		$	2,109,273
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—
Loans:
Ending balance: individually evaluated for impairment	$	—		$	563,650		$	102,310		$	665,960
Ending balance: collectively evaluated for impairment	$	141,048,220		$	38,093,353		$	192,891		$	179,334,464
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—

Charge-offs as a percentage of average loans in repayment and forbearance (annualized)		.07	%		3.5	%		—	%
Charge-offs as a percentage of average loans in repayment (annualized)		.09	%		3.7	%		—	%
Allowance as a percentage of the ending total loan balance		.13	%		5.3	%		21.5	%
Allowance as a percentage of the ending loans in repayment		.20	%		7.1	%		—	%
Allowance coverage of charge-offs (annualized)		2.3			1.9			1.2
Ending total loans⁽²⁾	$	141,048,220		$	38,657,003		$	295,201
Average loans in repayment	$	94,317,705		$	28,488,734		$	—
Ending loans in repayment	$	94,282,103		$	28,871,968		$	—


⁽¹⁾		Represents the additional allowance related to the amount of uncollectible interest reserved within interest income that is transferred in the period to the allowance for loan losses when interest is capitalized to a loan’s principal balance.

⁽²⁾		Ending total loans for Private Education Loans includes the receivable for partially charged-off loans.


	Allowance for Loan Losses
	Three Months Ended June 30, 2010
				Private Education			Other
	FFELP Loans			Loans			Loans			Total

Allowance for Loan Losses
Beginning balance	$	186,215		$	2,018,676		$	78,664		$	2,283,555
Total provision		28,613			349,211			4,415			382,239
Charge-offs		(24,235	)		(335,766	)		(6,553	)		(366,554	)
Loan sales		(1,908	)		—			—			(1,908	)
Reclassification of interest reserve⁽¹⁾		—			10,292			—			10,292

Ending Balance	$	188,685		$	2,042,413		$	76,526		$	2,307,624

Allowance:
Ending balance: individually evaluated for impairment	$	—		$	81,867		$	60,360		$	142,227
Ending balance: collectively evaluated for impairment	$	188,685		$	1,960,546		$	16,166		$	2,165,397
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—
Loans:
Ending balance: individually evaluated for impairment	$	—		$	363,370		$	123,223		$	486,593
Ending balance: collectively evaluated for impairment	$	145,932,811		$	37,735,165		$	261,495		$	183,929,471
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—

Charge-offs as a percentage of average loans in repayment and forbearance (annualized)		.10	%		5.1	%		—	%
Charge-offs as a percentage of average loans in repayment (annualized)		.12	%		5.3	%		—	%
Allowance as a percentage of the ending total loan balance		.13	%		5.4	%		19.9	%
Allowance as a percentage of the ending loans in repayment		.23	%		7.9	%		—	%
Allowance coverage of charge-offs (annualized)		1.9			1.5			2.9
Ending total loans⁽²⁾	$	145,932,811		$	38,098,535		$	384,718
Average loans in repayment	$	82,449,191		$	25,178,957		$	—
Ending loans in repayment	$	82,978,473		$	25,721,573		$	—


⁽¹⁾		Represents the additional allowance related to the amount of uncollectible interest reserved within interest income that is transferred in the period to the allowance for loan losses when interest is capitalized to a loan’s principal balance.

⁽²⁾		Ending total loans for Private Education Loans includes the receivable for partially charged-off loans.


	Allowance for Loan Losses
	Six Months Ended June 30, 2011
				Private Education			Other
	FFELP Loans			Loans			Loans			Total

Allowance for Loan Losses
Beginning balance	$	188,858		$	2,021,580		$	72,516		$	2,282,954
Total provision		45,435			539,986			8,670			594,091
Charge-offs		(41,140	)		(536,582	)		(17,619	)		(595,341	)
Loan sales		(4,129	)		—			—			(4,129	)
Reclassification of interest reserve⁽¹⁾		—			17,619			—			17,619

Ending Balance	$	189,024		$	2,042,603		$	63,567		$	2,295,194

Allowance:
Ending balance: individually evaluated for impairment	$	—		$	133,796		$	52,125		$	185,921
Ending balance: collectively evaluated for impairment	$	189,024		$	1,908,807		$	11,442		$	2,109,273
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—
Loans:
Ending balance: individually evaluated for impairment	$	—		$	563,650		$	102,310		$	665,960
Ending balance: collectively evaluated for impairment	$	141,048,220		$	38,093,353		$	192,891		$	179,334,464
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—

Charge-offs as a percentage of average loans in repayment and forbearance (annualized)		.07	%		3.6	%		—	%
Charge-offs as a percentage of average loans in repayment (annualized)		.09	%		3.8	%		—	%
Allowance as a percentage of the ending total loan balance		.13	%		5.3	%		21.5	%
Allowance as a percentage of the ending loans in repayment		.20	%		7.1	%		—	%
Allowance coverage of charge-offs (annualized)		2.3			1.9			1.8
Ending total loans⁽²⁾	$	141,048,220		$	38,657,003		$	295,201
Average loans in repayment	$	94,907,800		$	28,308,899		$	—
Ending loans in repayment	$	94,282,103		$	28,871,968		$	—


⁽¹⁾		Represents the additional allowance related to the amount of uncollectible interest reserved within interest income that is transferred in the period to the allowance for loan losses when interest is capitalized to a loan’s principal balance.

⁽²⁾		Ending total loans for Private Education Loans includes the receivable for partially charged-off loans.


	Allowance for Loan Losses
	Six Months Ended June 30, 2010
				Private Education			Other
	FFELP Loans			Loans			Loans			Total

Allowance for Loan Losses
Beginning balance	$	161,168		$	1,443,440		$	76,261		$	1,680,869
Total provision		51,609			674,233			15,517			741,359
Charge-offs		(45,639	)		(620,244	)		(15,252	)		(681,135	)
Loan sales		(3,602	)		—			—			(3,602	)
Reclassification of interest reserve⁽¹⁾		—			20,934			—			20,934
Consolidation of securitization trusts⁽²⁾		25,149			524,050			—			549,199

Ending Balance	$	188,685		$	2,042,413		$	76,526		$	2,307,624

Allowance:
Ending balance: individually evaluated for impairment	$	—		$	81,867		$	60,360		$	142,227
Ending balance: collectively evaluated for impairment	$	188,685		$	1,960,546		$	16,166		$	2,165,397
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—
Loans:
Ending balance: individually evaluated for impairment	$	—		$	363,370		$	123,223		$	486,593
Ending balance: collectively evaluated for impairment	$	145,932,811		$	37,735,165		$	261,495		$	183,929,471
Ending balance: loans acquired with deteriorated credit quality	$	—		$	—		$	—		$	—

Charge-offs as a percentage of average loans in repayment and forbearance (annualized)		.09	%		4.8	%		—	%
Charge-offs as a percentage of average loans in repayment (annualized)		.11	%		5.0	%		—	%
Allowance as a percentage of the ending total loan balance		.13	%		5.4	%		19.9	%
Allowance as a percentage of the ending loans in repayment		.23	%		7.9	%		—	%
Allowance coverage of charge-offs (annualized)		2.1			1.6			2.5	%
Ending total loans⁽³⁾	$	145,932,811		$	38,098,535		$	384,718
Average loans in repayment	$	82,443,391		$	24,913,768		$	—
Ending loans in repayment	$	82,978,473		$	25,721,573		$	—


⁽¹⁾		Represents the additional allowance related to the amount of uncollectible interest reserved within interest income that is transferred in the period to the allowance for loan losses when interest is capitalized to a loan’s principal balance.

⁽²⁾		Upon the adoption of the new consolidation accounting guidance on January 1, 2010, we consolidated all of our previously off-balance sheet securitization trusts.

⁽³⁾		Ending total loans for Private Education Loans includes the receivable for partially charged-off loans.

Age analysis of past due loans delinquencies


	FFELP Loan Delinquencies
	June 30,						December 31,
	2011						2010
(Dollars in millions)	Balance			%			Balance			%

Loans in-school/grace/deferment⁽¹⁾	$	25,718					$	28,214
Loans in forbearance⁽²⁾		21,048						22,028
Loans in repayment and percentage of each status:
Loans current		78,201			82.9	%		80,026			82.8	%
Loans delinquent 31-60 days⁽³⁾		5,149			5.5			5,500			5.7
Loans delinquent 61-90 days⁽³⁾		2,909			3.1			3,178			3.3
Loans delinquent greater than 90 days⁽³⁾		8,023			8.5			7,992			8.2

Total FFELP Loans in repayment		94,282			100	%		96,696			100	%

Total FFELP Loans, gross		141,048						146,938
FFELP Loan unamortized premium		1,776						1,900

Total FFELP Loans		142,824						148,838
FFELP Loan allowance for losses		(189	)					(189	)

FFELP Loans, net	$	142,635					$	148,649

Percentage of FFELP Loans in repayment					66.8	%					65.8	%

Delinquencies as a percentage of FFELP Loans in repayment					17.1	%					17.2	%

FFELP Loans in forbearance as a percentage of loans in repayment and forbearance					18.2	%					18.6	%


⁽¹⁾		Loans for borrowers who may still be attending school or engaging in other permitted educational activities and are not yet required to make payments on the loans, e.g., residency periods for medical students or a grace period for bar exam preparation, as well as loans for borrowers who have requested extension of grace period during employment transition.

⁽²⁾		Loans for borrowers who have used their allowable deferment time or do not qualify for deferment, that need additional time to obtain employment or who have temporarily ceased making payments due to hardship or other factors.

⁽³⁾		The period of delinquency is based on the number of days scheduled payments are contractually past due.


	Private Education Traditional Loan Delinquencies
	June 30,						December 31,
	2011						2010
(Dollars in millions)	Balance			%			Balance			%

Loans in-school/grace/deferment⁽¹⁾	$	6,431					$	7,419
Loans in forbearance⁽²⁾		1,225						1,156
Loans in repayment and percentage of each status:
Loans current		23,964			91.7	%		22,850			91.2	%
Loans delinquent 31-60 days⁽³⁾		759			2.9			794			3.2
Loans delinquent 61-90 days⁽³⁾		433			1.7			340			1.4
Loans delinquent greater than 90 days⁽³⁾		978			3.7			1,060			4.2

Total traditional loans in repayment		26,134			100	%		25,044			100	%

Total traditional loans, gross		33,790						33,619
Traditional loans unamortized discount		(775	)					(801	)

Total traditional loans		33,015						32,818
Traditional loans receivable for partially charged-off loans		629						558
Traditional loans allowance for losses		(1,363	)					(1,231	)

Traditional loans, net	$	32,281					$	32,145

Percentage of traditional loans in repayment					77.3	%					74.5	%

Delinquencies as a percentage of traditional loans in repayment					8.3	%					8.8	%

Loans in forbearance as a percentage of loans in repayment and forbearance					4.5	%					4.4	%

Loans in repayment greater than 12 months as a percentage of loans in repayment⁽⁴⁾					66.7	%					65.2	%


⁽¹⁾		Loans for borrowers who may still be attending school or engaging in other permitted educational activities and are not yet required to make payments on the loans, e.g., residency periods for medical students or a grace period for bar exam preparation.

⁽²⁾		Loans for borrowers who have requested extension of grace period generally during employment transition or who have temporarily ceased making payments due to hardship or other factors, consistent with established loan program servicing policies and procedures.

⁽³⁾		The period of delinquency is based on the number of days scheduled payments are contractually past due.

⁽⁴⁾		Based on number of months in an active repayment status for which a scheduled monthly payment was due.


	Private Education Non-Traditional Loan
	Delinquencies
	June 30,						December 31,
	2011						2010
(Dollars in millions)	Balance			%			Balance			%

Loans in-school/grace/deferment⁽¹⁾	$	785					$	921
Loans in forbearance⁽²⁾		205						184
Loans in repayment and percentage of each status:
Loans current		2,030			74.1	%		2,038			72.6	%
Loans delinquent 31-60 days⁽³⁾		204			7.5			217			7.7
Loans delinquent 61-90 days⁽³⁾		142			5.2			131			4.7
Loans delinquent greater than 90 days⁽³⁾		361			13.2			422			15.0

Total non-traditional loans in repayment		2,737			100	%		2,808			100	%

Total non-traditional loans, gross		3,727						3,913
Non-traditional loans unamortized discount		(86	)					(93	)

Total non-traditional loans		3,641						3,820
Non-traditional loans receivable for partially charged-off loans		511						482
Non-traditional loans allowance for losses		(680	)					(791	)

Non-traditional loans, net	$	3,472					$	3,511

Percentage of non-traditional loans in repayment					73.5	%					71.8	%

Delinquencies as a percentage of non-traditional loans in repayment					25.9	%					27.4	%

Loans in forbearance as a percentage of loans in repayment and forbearance					7.0	%					6.1	%

Loans in repayment greater than 12 months as a percentage of loans in repayment⁽⁴⁾					60.0	%					55.9	%


⁽¹⁾		Loans for borrowers who may still be attending school or engaging in other permitted educational activities and are not yet required to make payments on the loans, e.g., residency periods for medical students or a grace period for bar exam preparation.

⁽²⁾		Loans for borrowers who have requested extension of grace period generally during employment transition or who have temporarily ceased making payments due to hardship or other factors, consistent with established loan program servicing policies and procedures.

⁽³⁾		The period of delinquency is based on the number of days scheduled payments are contractually past due.

⁽⁴⁾		Based on number of months in an active repayment status for which a scheduled monthly payment was due.

Accrued Interest Receivable


	Accrued Interest Receivable
			Greater than		Allowance for
			90 days		Uncollectible
	Total		Past Due		Interest

June 30, 2011
Private Education Loans — Traditional	$	970,674	$	33,319	$	50,718
Private Education Loans — Non-Traditional		178,013		17,990		36,412

Total	$	1,148,687	$	51,309	$	87,130

December 31, 2010
Private Education Loans — Traditional	$	1,062,289	$	34,644	$	56,755
Private Education Loans — Non-Traditional		208,587		20,270		37,057

Total	$	1,270,876	$	54,914	$	93,812

Key credit quality indicators of the Company's loan portfolio as well as how frequently the Company updates its analysis of the allowance for loan losses for changes in these credit quality indicators


	Private Education Loans
	Credit Quality Indicators
	June 30, 2011					December 31, 2010
(Dollars in millions)	Balance⁽³⁾		% of Balance			Balance⁽³⁾		% of Balance

Credit Quality Indicators
School Type/FICO Scores:
Traditional	$	33,790		90	%	$	33,619		90	%
Non-Traditional⁽¹⁾		3,727		10			3,913		10

Total	$	37,517		100	%	$	37,532		100	%

Cosigners:
With cosigner	$	22,650		60	%	$	22,259		59	%
Without cosigner		14,867		40			15,273		41

Total	$	37,517		100	%	$	37,532		100	%

Seasoning⁽²⁾:
1-12 payments	$	10,793		29	%	$	10,932		29	%
13-24 payments		6,625		18			6,659		18
25-36 payments		4,592		12			4,457		12
37-48 payments		3,267		9			2,891		8
More than 48 payments		5,024		13			4,253		11
Not yet in repayment		7,216		19			8,340		22

Total	$	37,517		100	%	$	37,532		100	%


⁽¹⁾		Defined as loans to borrowers attending for-profit schools (with a FICO score of less than 670 at origination) and borrowers attending not-for-profit schools (with a FICO score of less than 640 at origination).

⁽²⁾		Number of months in active repayment for which a scheduled payment was due.

⁽³⁾		Balance represents gross Private Education Loans.