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Stock-Based Compensation Plans and Arrangements
 12 Months Ended
Dec. 31, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation Plans and Arrangements Stock-Based Compensation Plans and Arrangements
Plan Summaries
As of December 31, 2024, we had one active stock-based compensation plan that provides for grants of equity awards to our employees and non-employee directors.
The SLM Corporation 2021 Omnibus Incentive Plan was approved by shareholders on June 8, 2021, and at December 31, 2024, 14 million shares were authorized to be issued from this plan.
We also maintain an Employee Stock Purchase Plan (the “ESPP”). The number of shares authorized under the plan at December 31, 2024 was 14 million shares.
Shares issued under these stock-based compensation plans may be either shares reacquired by us or shares that are authorized but unissued.

Stock-Based Compensation

The total stock-based compensation cost recognized in the consolidated statements of income for the years ended December 31, 2024, 2023, and 2022 was $40 million, $36 million, and $34 million, respectively. As of December 31, 2024, there was $23 million of total unrecognized compensation expense related to unvested restricted stock awards, restricted stock units, performance stock units, and ESPP awards, which is expected to be recognized over a weighted average period of 1.5 years. We amortize compensation expense on a straight-line basis over the related vesting periods of each tranche of each award.
Stock Options
There were 86,536 time-vested options granted in the year ended December 31, 2022. The options were granted to team members of an acquisition that took place in the first half of the year in 2022. The exercise price of the options is equal to 100 percent of the fair market value of a share of our common stock as of the grant date. The options will vest 100 percent on the third anniversary of the respective grant date and expire ten years after the respective grant date. The fair value of each stock option grant was estimated on the date of grant using a Black-Scholes option pricing model. The expected volatility of our common stock at the date of grant is estimated based on a historic volatility rate and the expected option life is calculated based on historical stock option experience as the best estimate of future exercise patterns. The dividend yield assumption is based on historical and anticipated dividend payouts. The risk-free interest rate assumption is based on observed interest rates consistent with the expected life of each stock option grant.
There were no stock options granted in the years ended December 31, 2023 and 2024.
 The following table summarizes stock option activity for the year ended December 31, 2024.
 
(Dollars in thousands, shares and per share amounts in actuals)Number of
Options		Weighted
Average
Exercise
Price per
Share		Weighted
Average
Remaining
Contractual
Term
Aggregate
Intrinsic
Value(1)
Outstanding at December 31, 20231,066,197 $17.59 
Granted— — 
Exercised(2)(3)
(65,668)17.65 
Canceled— — 
Outstanding at December 31, 2024(4)
1,000,529 $17.59 6.2 years$9,997 
Exercisable at December 31, 2024933,223 $17.65 6.1 years$9,267 
    
(1)The aggregate intrinsic value represents the total intrinsic value (the aggregate difference between our closing stock price on December 31, 2024 and the exercise price of in-the-money options) that would have been received by the option holders if all in-the-money options had been exercised on December 31, 2024.
(2)The total intrinsic value of the options exercised was $0.3 million for the year ended December 31, 2024. No options were exercised in the years ended December 31, 2023 and 2022.
(3)Cash of $1 million was received from option exercises for the year ended December 31, 2024. The actual tax benefit realized for the tax deductions from option exercises totaled less than $1 million for the year ended December 31, 2024.
(4)For net-settled options, gross number is reflected.
    
    Restricted Stock
Restricted stock awards generally vest over one year. Outstanding restricted stock is entitled to dividend equivalent units that vest subject to the same vesting requirements or lapse of transfer restrictions, as applicable, as the underlying restricted stock award. The fair value of restricted stock awards is based on our stock price at the grant date.
 
The following table summarizes restricted stock activity for the year ended December 31, 2024.
 
(Shares and per share amounts in actuals)Number of
Shares		Weighted
Average Grant
Date
Fair Value
Non-vested at December 31, 202383,479 $16.47 
Granted77,759 20.51 
Vested(1)
(83,479)16.47 
Canceled(7,069)20.51 
Non-vested at December 31, 2024(2)
70,690 $20.51 
(1)The total fair value of shares that vested during the years ended December 31, 2024, 2023, and 2022 was $1 million, $1 million, and $1 million, respectively.
(2)As of December 31, 2024, there was $0.7 million of unrecognized compensation cost related to restricted stock, which is expected to be recognized over a weighted average period of 0.5 years.
Restricted Stock Units and Performance Stock Units
Restricted stock units (“RSUs”) and performance stock units (“PSUs”) are equity awards granted to employees that entitle the holder to shares of our common stock when the award vests. RSUs may be time-vested over three years or vested at grant but subject to transfer restrictions, while PSUs vest based on corporate performance targets at the end of a three-year period.
Outstanding RSUs and PSUs are entitled to dividend equivalent units that vest subject to the same vesting requirements or lapse of transfer restrictions, as applicable, as the underlying award. The fair value of RSUs is based on our stock price at the grant date. The fair value of each PSU grant was estimated on the date of grant using the Monte Carlo simulation-pricing model.
The following table summarizes RSU and PSU activity for the year ended December 31, 2024.

 
(Shares and per share amounts in actuals)Number of
RSUs/
PSUs		Weighted
Average Grant
Date
Fair Value
Outstanding at December 31, 20234,346,994 $16.39 
Granted2,061,763 20.22 
Vested and converted to common stock(1)
(1,932,557)16.39 
Canceled(38,019)18.25 
Outstanding at December 31, 2024(2)
4,438,181 $18.16 
(1)The total fair value of RSUs/PSUs that vested and converted to common stock during the years ended December 31, 2024, 2023, and 2022 was $32 million, $35 million, and $34 million, respectively.
(2)As of December 31, 2024, there was $22 million of unrecognized compensation cost related to RSUs/PSUs, which is expected to be recognized over a weighted average period of 1.5 years.
    
Employee Stock Purchase Plan
Employees may purchase shares of our common stock at the end of a 12-month offering period at a price equal to the share price at the beginning of the 12-month period, less 15 percent, up to a maximum purchase price of $7,500 (whole dollars). The purchase price for each offering is determined at the beginning of the offering period on August 1.
 
The fair values of the stock purchase rights of the ESPP offerings were calculated using a Black-Scholes option pricing model with the following weighted average assumptions:

 
Years ended December 31, (per share amounts in actuals)202420232022
Risk-free interest rate4.56 %5.31 %3.02 %
Expected volatility27 %38 %39 %
Expected dividend rate1.99 %2.73 %2.78 %
Expected life of the option1 year1 year1 year
Weighted average fair value of stock purchase rights$5.07 $4.14 $4.17 
The expected volatility is based on implied volatility from publicly-traded options on our stock at the grant date and historical volatility of our stock consistent with the expected life. The risk-free interest rate is based on the zero-coupon U.S. Treasury STRIPS rate at the grant date consistent with the expected life.
The fair values were amortized to compensation cost on a straight-line basis over a one-year vesting period. As of December 31, 2024, there was less than $1 million of unrecognized compensation cost related to the ESPP, which is expected to be recognized by July 2025.
During the years ended December 31, 2023 and 2024, plan participants purchased approximately 195,000 shares and 227,000 shares, respectively, of our common stock. No shares were purchased for the year ended December 31, 2022, as our stock price on July 31, 2022 was less than the offering price for the ESPP plan.