--12-310001593538falseQ3http://fasb.org/us-gaap/2025#InterestReceivableAndOtherAssetshttp://fasb.org/us-gaap/2025#InterestReceivableAndOtherAssetshttp://fasb.org/us-gaap/2025#OtherLiabilitieshttp://fasb.org/us-gaap/2025#OtherLiabilitieshttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#GainLossOnDerivativeInstrumentsNetPretaxhttp://fasb.org/us-gaap/2025#ValuationTechniqueDiscountedCashFlowMemberhttp://fasb.org/us-gaap/2025#MeasurementInputConstantPrepaymentRateMember00015935382024-06-300001593538navi:PrivateEducationLoansMember2024-09-300001593538navi:LoanStatusMembernavi:SchoolOrGraceOrDefermentOrForbearanceMember2025-09-300001593538navi:NonModifiedLoansMembernavi:CertainLoanModificationsMember2024-09-300001593538navi:InterestRateReductionAndExtendedMaturityMembernavi:PrivateEducationLoansMember2025-01-012025-09-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:CrossCurrencyInterestRateContractMember2025-09-300001593538us-gaap:OperatingSegmentsMember2025-07-012025-09-300001593538us-gaap:RetainedEarningsMember2025-01-012025-09-300001593538navi:BusinessProcessingMember2024-01-012024-09-300001593538us-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538navi:RepaymentsMembernavi:SeasoningThirteenThruTwentyFourMember2025-09-300001593538us-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2024-01-012024-09-300001593538navi:PrivateEducationLoansMemberus-gaap:PaymentDeferralMember2025-07-012025-09-300001593538navi:BusinessProcessingMember2025-09-300001593538us-gaap:OtherContractMember2024-06-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMemberus-gaap:AllOtherSegmentsMember2025-07-012025-09-3000015935382025-01-012025-09-300001593538us-gaap:AllOtherSegmentsMember2025-09-300001593538navi:FFELPLoanAssetBackedSecuritizationsRepurchaseFacilitiesMemberus-gaap:UnsecuredDebtMember2024-12-310001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesForbearanceLoansInRepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:LoanStatusMembernavi:LoanStatusGreaterThanNinetyDaysDelinquentMember2024-09-300001593538navi:StaffordLoansMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-01-012025-09-300001593538navi:CosignerLoanMember2024-09-300001593538navi:FinancialAsset90DaysPastDueMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:InterestRateSwapMember2024-06-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:PrivateEducationLoanABCPFacilitiesMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:ConsumerLendingSegmentMember2024-01-012024-09-300001593538us-gaap:InterestRateSwapMember2025-07-012025-09-300001593538navi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMembernavi:NetImpactOfDerivativeAccountingMember2024-01-012024-09-300001593538navi:SeasoningOneThruTwelveMembernavi:RepaymentsMember2024-09-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:AccountsReceivableMember2025-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2025-01-012025-09-300001593538navi:FederalGovernmentMembernavi:BusinessProcessingMember2025-01-012025-09-300001593538us-gaap:InterestRateSwapMember2024-12-310001593538navi:CommonStockSharesOutstandingMember2024-06-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-3100015935382023-12-310001593538navi:LoanStatusMember2025-09-300001593538navi:PrivateEducationLoansMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-12-310001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2024-07-012024-09-300001593538us-gaap:TreasuryStockCommonMember2024-06-300001593538us-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538navi:SchoolTypeMember2025-09-300001593538navi:SchoolGraceDefermentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:GainLossOnDerivativeInstrumentsMember2024-07-012024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesLoansInRepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-01-012025-09-300001593538us-gaap:NondesignatedMember2024-01-012024-09-3000015935382024-09-300001593538navi:BusinessProcessingMembernavi:GovernmentServicesMember2025-07-012025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538navi:RepaymentsMember2025-09-300001593538us-gaap:OperatingSegmentsMember2024-01-012024-09-300001593538us-gaap:SecuredDebtMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538navi:CommonStockSharesOutstandingMember2024-07-012024-09-300001593538us-gaap:EstimateOfFairValueFairValueDisclosureMember2025-09-300001593538navi:NetImpactOfGoodwillAndAcquiredIntangiblesMembernavi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2025-07-012025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueHedgingMember2024-07-012024-09-300001593538us-gaap:InterestExpenseMember2024-07-012024-09-300001593538navi:SeasoningOneThruTwelveMembernavi:RepaymentsMember2025-09-300001593538navi:CommonStockSharesOutstandingMember2023-12-310001593538us-gaap:CommonStockMember2025-07-012025-09-300001593538us-gaap:OperatingSegmentsMembernavi:FederalEducationLoansSegmentMember2025-01-012025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables31To60DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:FinancialAsset90DaysPastDueMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMember2025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:FinancialAsset31To60DaysPastDueMember2024-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2024-07-012024-09-300001593538navi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2025-01-012025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:ChangeDuringPeriodFairValueDisclosureMember2025-09-300001593538us-gaap:NondesignatedMemberus-gaap:CrossCurrencyInterestRateContractMember2025-09-300001593538us-gaap:FinancialAssetNotPastDueMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:RepaymentsMembernavi:SeasoningMoreThanFortyEightMember2025-09-300001593538us-gaap:AdditionalPaidInCapitalMember2025-09-300001593538us-gaap:ChangeDuringPeriodFairValueDisclosureMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2024-07-012024-09-300001593538navi:SixFourZeroAndAboveMembernavi:FicoMember2024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables61To90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesForbearanceLoansInRepaymentMemberus-gaap:AccountsReceivableMember2024-01-012024-12-310001593538navi:PrivateEducationLoansMembernavi:FinancialAsset31To60DaysPastDueMember2025-09-300001593538us-gaap:TreasuryStockCommonMember2024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-09-300001593538navi:HealthcareServicesMember2024-09-190001593538navi:PrivateEducationLoansMemberus-gaap:ContractualInterestRateReductionMember2024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-07-012025-09-300001593538navi:BusinessProcessingMember2025-07-012025-09-300001593538navi:OpenMarketShareRepurchasesMemberus-gaap:TreasuryStockCommonMember2024-07-012024-09-300001593538navi:RepaymentsMembernavi:SeasoningThirtySevenThruFortyEightMember2025-09-300001593538navi:SchoolGraceDefermentMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-12-310001593538navi:BusinessProcessingMember2025-01-012025-09-300001593538us-gaap:AllOtherSegmentsMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesLoansInRepaymentMemberus-gaap:AccountsReceivableMember2024-01-012024-12-310001593538navi:BusinessProcessingMembernavi:StateAndLocalGovernmentMember2024-07-012024-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2024-01-012024-09-300001593538navi:FFELPLoanAssetBackedSecuritizationsRepurchaseFacilitiesMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:FFELPLoanAssetBackedSecuritizationsRepurchaseFacilitiesMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables61To90DaysPastDueMemberus-gaap:AccountsReceivableMember2025-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMember2024-01-012024-09-300001593538navi:NetImpactOfGoodwillAndAcquiredIntangiblesMembernavi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2025-01-012025-09-300001593538us-gaap:FairValueInputsLevel2Memberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:AdditionalPaidInCapitalMember2025-07-012025-09-300001593538us-gaap:InterestRateSwapMember2024-09-300001593538navi:FinancialAsset90DaysPastDueMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:PrivateEducationLoansMember2024-07-012024-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMember2025-07-012025-09-300001593538us-gaap:AdditionalPaidInCapitalMember2024-12-310001593538us-gaap:OperatingSegmentsMember2025-01-012025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:LongTermDebtMember2024-12-310001593538us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:CrossCurrencyInterestRateContractMember2025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueHedgingMember2024-12-310001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMembernavi:FinancialAsset61To90DaysPastDueMemberus-gaap:AccountsReceivableMember2024-12-310001593538us-gaap:CommonStockMember2024-12-310001593538navi:ReclassificationsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2025-07-012025-09-300001593538us-gaap:ChangeDuringPeriodFairValueDisclosureMember2024-12-310001593538navi:EducationLoanMember2024-01-012024-09-300001593538navi:ConsumerLendingSegmentMember2025-07-012025-09-300001593538navi:SeriesAJuniorParticipatingPreferredStockMember2024-12-310001593538navi:FinancialAsset90DaysPastDueMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMember2024-12-310001593538navi:SixFourZeroAndAboveMembernavi:FicoMember2025-09-300001593538us-gaap:CarryingReportedAmountFairValueDisclosureMember2025-09-300001593538navi:FFELPLoanAssetBackedSecuritizationsRepurchaseFacilitiesMemberus-gaap:UnsecuredDebtMember2025-09-300001593538us-gaap:UnsecuredDebtMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:AdditionalPaidInCapitalMember2025-06-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-09-300001593538us-gaap:EmployeeStockOptionMember2024-01-012024-09-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:CrossCurrencyInterestRateContractMember2024-12-310001593538navi:PrivateEducationLoansMember2024-01-012024-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:FFELPLoanABCPFacilitiesMember2025-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538navi:OpenMarketShareRepurchasesMember2025-07-012025-09-300001593538navi:PrivateEducationLoanSecuritizationsRepurchaseFacilityMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:EmployeeStockOptionMember2024-07-012024-09-300001593538navi:CommonStockParValuePointZeroOnePerShareMember2025-01-012025-09-300001593538us-gaap:TreasuryStockCommonMember2025-07-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:FinancialAsset31To60DaysPastDueMember2025-09-300001593538us-gaap:GainLossOnDerivativeInstrumentsMember2025-01-012025-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:PrivateEducationLoanSecuritizationsMember2025-09-300001593538us-gaap:TreasuryStockCommonMember2024-01-012024-09-300001593538navi:BusinessProcessingMembernavi:GovernmentServicesMember2024-07-012024-09-300001593538navi:CommonStockSharesOutstandingMember2024-01-012024-09-300001593538us-gaap:RetainedEarningsMember2025-06-300001593538us-gaap:CommonStockMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueHedgingMember2025-07-012025-09-300001593538navi:FFELPLoanSecuritizationsMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2025-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2023-12-310001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMemberus-gaap:AllOtherSegmentsMember2024-07-012024-09-300001593538navi:PrivateEducationLoansMemberus-gaap:ContractualInterestRateReductionMember2025-07-012025-09-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:AdditionalPaidInCapitalMember2024-07-012024-09-300001593538navi:EducationLoanMember2024-07-012024-09-300001593538navi:ConsumerLendingMember2025-01-012025-09-300001593538navi:PrivateEducationLoansMember2025-07-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:ForbearanceMember2025-09-300001593538navi:BusinessProcessingMembernavi:TollingAuthoritiesMember2024-07-012024-09-300001593538us-gaap:AdditionalPaidInCapitalMember2024-01-012024-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables31To60DaysPastDueMemberus-gaap:AccountsReceivableMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMembernavi:ConsolidationLoansMember2024-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2023-12-310001593538us-gaap:AllOtherSegmentsMember2024-01-012024-09-300001593538navi:ABCPFacilitiesMember2024-01-012024-09-300001593538navi:ReclassificationsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2024-07-012024-09-300001593538us-gaap:InterestExpenseMember2025-07-012025-09-3000015935382025-06-300001593538navi:CosignerLoanMembernavi:CosignersMember2025-09-300001593538navi:SchoolTypeMembernavi:ForProfitMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables61To90DaysPastDueMemberus-gaap:AccountsReceivableMember2024-12-310001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:TreasuryStockCommonMember2025-06-300001593538us-gaap:CrossCurrencyInterestRateContractMember2025-09-300001593538navi:OtherBorrowingsMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMembernavi:FinancialAsset61To90DaysPastDueMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMembernavi:FederalEducationLoansSegmentMember2025-07-012025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:CashFlowHedgingMember2025-09-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-06-300001593538navi:OpenMarketShareRepurchasesMemberus-gaap:TreasuryStockCommonMember2025-07-012025-09-300001593538navi:EliminationsAndReconcilingItemsMembernavi:AdjustmentsForCoreToGaapAccountingMember2024-01-012024-09-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMembernavi:FederalEducationLoansSegmentMember2025-01-012025-09-300001593538us-gaap:RetainedEarningsMember2024-01-012024-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2024-07-012024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables61To90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-06-300001593538navi:RepaymentsMembernavi:SeasoningTwentyFiveThruThirtySixMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueHedgingMember2024-07-012024-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2025-07-012025-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2025-01-012025-09-300001593538navi:InterestRateReductionAndExtendedMaturityMembernavi:PrivateEducationLoansMember2025-07-012025-09-300001593538navi:CertainLoanModificationsMembernavi:ModifiedLoansMember2024-09-300001593538navi:BusinessProcessingMember2024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueHedgingMember2025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538navi:RepaymentsMembernavi:SeasoningMoreThanFortyEightMember2024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables61To90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:TreasuryStockCommonMember2024-07-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueHedgingMember2025-09-300001593538navi:FFELPLoanSecuritizationsMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:BusinessProcessingMember2024-07-012024-09-300001593538navi:PrivateEducationLoansMemberus-gaap:PaymentDeferralMember2024-07-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2024-07-012024-09-300001593538navi:PrivateEducationLoanABCPFacilitiesMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:FinancialAsset31To60DaysPastDueMember2024-12-310001593538us-gaap:InterestRateSwapMember2024-01-012024-09-300001593538us-gaap:SecuredDebtMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:OtherBorrowingsMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2024-01-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueHedgingMember2025-01-012025-09-300001593538navi:SchoolDefermentMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-12-310001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2025-07-012025-09-300001593538navi:SchoolTypeMembernavi:ForProfitMember2024-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:FinancingReceivables31To60DaysPastDueMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:ForbearanceMember2024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesLoansInRepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-12-310001593538navi:OpenMarketShareRepurchasesMemberus-gaap:TreasuryStockCommonMember2025-01-012025-09-300001593538navi:InterestExpenseAndDerivativeInstrumentsHedgingActivitiesMember2025-07-012025-09-300001593538navi:HedgeAccountingAdjustmentsMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2024-12-310001593538us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:ChangeDuringPeriodFairValueDisclosureMember2025-09-300001593538navi:EducationLoanMember2025-01-012025-09-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538navi:OpenMarketShareRepurchasesMember2024-01-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesLoansInRepaymentMemberus-gaap:AccountsReceivableMember2025-01-012025-09-300001593538navi:BusinessProcessingMembernavi:TollingAuthoritiesMember2025-01-012025-09-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2025-07-012025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueHedgingMember2025-07-012025-09-300001593538us-gaap:GainLossOnDerivativeInstrumentsMember2024-01-012024-09-300001593538navi:PrivateEducationLoansMemberus-gaap:PaymentDeferralMember2025-01-012025-09-300001593538navi:FinancialAsset90DaysPastDueMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:ForbearanceMember2024-12-310001593538us-gaap:AdditionalPaidInCapitalMember2025-01-012025-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2024-12-310001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesLoansInRepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-09-300001593538navi:SchoolTypeMember2024-09-300001593538navi:ReclassificationsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2025-01-012025-09-300001593538navi:SeriesAJuniorParticipatingPreferredStockMember2025-09-300001593538navi:PrivateEducationLoansMemberus-gaap:PaymentDeferralMember2024-01-012024-09-300001593538us-gaap:OperatingSegmentsMember2024-07-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:AccountsReceivableMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:FinancingReceivablesCurrentMember2024-01-012024-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:RetainedEarningsMember2025-09-300001593538navi:FederalEducationLoansSegmentMember2024-12-310001593538us-gaap:NondesignatedMember2024-07-012024-09-300001593538navi:PrivateEducationLoanSecuritizationsMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:NondesignatedMember2025-01-012025-09-300001593538navi:OpenMarketShareRepurchasesMember2025-01-012025-09-300001593538us-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2025-01-012025-09-300001593538navi:PreferredStockPurchaseRightsMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-01-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMembernavi:FinancialAsset61To90DaysPastDueMemberus-gaap:AccountsReceivableMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-01-012024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueHedgingMember2024-01-012024-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:ForbearanceMember2025-09-300001593538navi:CounterPartyMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:FinancialAsset31To60DaysPastDueMember2024-12-310001593538us-gaap:AllOtherSegmentsMember2025-07-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-12-310001593538us-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2025-09-300001593538us-gaap:OtherContractMember2024-09-300001593538navi:CosignerLoanMembernavi:CosignersMember2024-09-300001593538us-gaap:FinancialAssetNotPastDueMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:OtherContractMember2025-07-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:FinancialAsset31To60DaysPastDueMember2024-09-300001593538navi:FFELPLoanAssetBackedSecuritizationsRepurchaseFacilitiesMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2024-01-012024-09-300001593538navi:FederalEducationLoansSegmentMember2025-01-012025-09-300001593538us-gaap:EmployeeStockOptionMember2025-01-012025-09-300001593538us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2024-07-012024-09-300001593538navi:ABCPFacilitiesMember2024-07-012024-09-300001593538navi:SchoolGraceDefermentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:FinancialAsset90DaysPastDueMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2025-09-300001593538navi:EliminationsAndReconcilingItemsMembernavi:AdjustmentsForCoreToGaapAccountingMembernavi:NetImpactOfDerivativeAccountingMember2025-07-012025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMembernavi:FinancialAsset61To90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-12-3100015935382021-12-310001593538navi:LoanStatusMembernavi:LoanStatusCurrentOrNinetyDaysOrLessDelinquentMember2024-09-300001593538us-gaap:InterestExpenseMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2025-01-012025-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMember2025-01-012025-09-3000015935382025-07-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesForbearanceLoansInRepaymentMemberus-gaap:AccountsReceivableMember2024-01-012024-09-300001593538navi:FFELPLoanSecuritizationsMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:CashFlowHedgingMember2024-12-310001593538us-gaap:CommonStockMember2023-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesForbearanceLoansInRepaymentMemberus-gaap:AccountsReceivableMember2025-01-012025-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2025-07-012025-09-300001593538navi:HedgeAccountingAdjustmentsMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2025-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-09-300001593538navi:CommonStockSharesOutstandingMember2025-06-300001593538us-gaap:CommonStockMember2024-01-012024-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2024-01-012024-09-300001593538navi:FFELPLoanSecuritizationsMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538navi:EliminationsAndReconcilingItemsMembernavi:AdjustmentsForCoreToGaapAccountingMembernavi:NetImpactOfDerivativeAccountingMember2024-07-012024-09-300001593538navi:HedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:CashFlowHedgingMember2025-09-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMemberus-gaap:AllOtherSegmentsMember2024-01-012024-09-300001593538us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueHedgingMember2025-09-300001593538navi:BusinessProcessingMembernavi:HealthcareServicesMember2024-01-012024-09-300001593538navi:FederalEducationLoansSegmentMember2024-01-012024-09-300001593538navi:ABCPFacilitiesMember2025-07-012025-09-300001593538us-gaap:TreasuryStockCommonMember2025-09-300001593538navi:SchoolTypeMembernavi:NotForProfitMember2025-09-3000015935382025-09-300001593538us-gaap:CarryingReportedAmountFairValueDisclosureMember2024-12-310001593538us-gaap:NondesignatedMember2025-09-300001593538us-gaap:OtherContractMember2024-01-012024-09-300001593538navi:EliminationsAndReconcilingItemsMembernavi:AdditionsSubtractionsForCoreToGaapAccountingMember2025-07-012025-09-300001593538navi:RepaymentsMembernavi:SeasoningTwentyFiveThruThirtySixMember2025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2025-01-012025-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538navi:BusinessProcessingMembernavi:StateAndLocalGovernmentMember2024-01-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-09-300001593538navi:CommonStockSharesOutstandingMember2024-09-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMemberus-gaap:AllOtherSegmentsMember2025-01-012025-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-01-012025-09-300001593538navi:RehabLoansMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-01-012025-09-300001593538us-gaap:OtherContractMemberus-gaap:FairValueInputsLevel3Member2025-09-300001593538us-gaap:OtherContractMember2023-12-310001593538us-gaap:InterestRateSwapMember2024-07-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2023-12-310001593538us-gaap:TreasuryStockCommonMember2024-12-310001593538navi:CosignersMember2025-09-300001593538navi:LoanStatusMembernavi:LoanStatusGreaterThanNinetyDaysDelinquentMember2025-09-300001593538us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:ShortTermDebtMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMembernavi:FinancingReceivablesDelinquentLoansInRepaymentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-01-012024-12-310001593538us-gaap:OtherContractMember2025-06-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:OtherContractMember2025-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:FinancingReceivablesCurrentMember2024-01-012024-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2024-06-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-12-310001593538navi:SeniorUnsecuredDebtMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:RehabLoansMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMembernavi:FinancialAsset61To90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesForbearanceLoansInRepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMembernavi:ConsolidationLoansMember2025-01-012025-09-300001593538navi:HealthcareServicesMember2024-09-192024-09-190001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMembernavi:ConsolidationLoansMember2025-09-300001593538navi:FinancialAsset61To90DaysPastDueMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:GovernmentServicesMember2024-12-192024-12-190001593538navi:PrivateEducationLoansMember2024-06-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMembernavi:FederalEducationLoansSegmentMember2024-07-012024-09-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-01-012024-09-300001593538navi:ReclassificationsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2024-01-012024-09-300001593538navi:NetImpactOfGoodwillAndAcquiredIntangiblesMembernavi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2024-01-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-12-310001593538navi:NetImpactOfGoodwillAndAcquiredIntangiblesMembernavi:EliminationsAndReconcilingItemsMembernavi:AdjustmentsForCoreToGaapAccountingMember2024-07-012024-09-300001593538navi:BusinessProcessingMembernavi:FederalGovernmentMember2024-07-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMember2025-09-300001593538navi:EliminationsAndReconcilingItemsMembernavi:AdditionsSubtractionsForCoreToGaapAccountingMember2024-07-012024-09-300001593538navi:PrivateEducationLoansMemberus-gaap:ContractualInterestRateReductionMember2025-01-012025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueHedgingMember2024-12-310001593538navi:NonModifiedLoansMembernavi:CertainLoanModificationsMember2025-09-300001593538us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2025-01-012025-09-300001593538navi:ABCPFacilitiesMember2025-01-012025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538navi:PrivateEducationLoansMemberus-gaap:ContractualInterestRateReductionMember2025-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMember2025-07-012025-09-300001593538us-gaap:RetainedEarningsMember2023-12-310001593538navi:LoanStatusMembernavi:LoanStatusCurrentOrNinetyDaysOrLessDelinquentMember2025-09-300001593538us-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:AdditionalPaidInCapitalMember2024-06-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:FinancialAsset31To60DaysPastDueMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:FinancingReceivablesCurrentMember2024-01-012024-12-310001593538us-gaap:FairValueInputsLevel1Memberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538navi:SchoolGraceDefermentMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2025-09-300001593538us-gaap:InterestExpenseMember2024-01-012024-09-300001593538navi:HedgeAccountingAdjustmentsMember2025-09-300001593538navi:BelowSixFourZeroMembernavi:FicoMember2024-09-300001593538us-gaap:FairValueInputsLevel1Memberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538navi:ConsumerLendingSegmentMember2025-01-012025-09-300001593538navi:SchoolGraceDefermentMembernavi:RepaymentsMember2025-09-300001593538navi:PrivateEducationLoanABCPFacilitiesMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2024-12-310001593538navi:BusinessProcessingMembernavi:TollingAuthoritiesMember2024-01-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueHedgingMember2024-07-012024-09-300001593538us-gaap:RetainedEarningsMember2025-07-012025-09-300001593538us-gaap:OperatingSegmentsMembernavi:FederalEducationLoansSegmentMember2024-01-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:LongTermDebtMember2025-09-300001593538navi:StaffordLoansMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2024-01-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueHedgingMember2024-01-012024-09-300001593538navi:ConsumerLendingMember2025-09-300001593538us-gaap:CommonStockMember2025-09-300001593538us-gaap:NondesignatedMemberus-gaap:CrossCurrencyInterestRateContractMember2024-12-310001593538navi:CommonStockSharesOutstandingMember2024-12-310001593538navi:SchoolGraceDefermentMembernavi:RepaymentsMember2024-09-300001593538navi:OpenMarketShareRepurchasesMemberus-gaap:TreasuryStockCommonMember2024-01-012024-09-300001593538us-gaap:NondesignatedMember2024-12-310001593538navi:FederalEducationLoansSegmentMember2025-09-300001593538us-gaap:OtherContractMember2024-07-012024-09-300001593538navi:FinancingReceivablesDelinquentLoansInRepaymentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-01-012025-09-300001593538navi:CommonStockSharesOutstandingMember2025-01-012025-09-300001593538us-gaap:FairValueInputsLevel2Memberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueMeasurementsRecurringMember2025-09-300001593538us-gaap:OperatingSegmentsMembernavi:EducationLoanMembernavi:FederalEducationLoansSegmentMember2024-01-012024-09-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2024-07-012024-09-300001593538us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2025-09-300001593538navi:OpenMarketShareRepurchasesMember2024-07-012024-09-300001593538navi:BusinessProcessingMembernavi:GovernmentServicesMember2025-01-012025-09-300001593538navi:StaffordLoansMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-09-300001593538navi:RepaymentsMember2024-09-300001593538us-gaap:AllOtherSegmentsMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables31To60DaysPastDueMemberus-gaap:AccountsReceivableMember2025-09-300001593538navi:PrivateEducationLoansMember2025-06-300001593538us-gaap:OtherContractMember2025-01-012025-09-300001593538us-gaap:InterestRateSwapMember2023-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:ForbearanceMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:ChangeDuringPeriodFairValueDisclosureMember2024-12-310001593538navi:DirectorsOrOfficersMember2025-07-012025-09-300001593538navi:FinancingReceivablesDelinquentLoansInRepaymentMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2025-01-012025-09-300001593538us-gaap:GainLossOnDerivativeInstrumentsMember2025-07-012025-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2024-06-300001593538navi:CommonStockSharesOutstandingMember2025-07-012025-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2024-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2024-07-012024-09-300001593538navi:CosignersMember2024-09-300001593538navi:EducationLoanMember2025-07-012025-09-300001593538navi:NonCosignerLoanMembernavi:CosignersMember2025-09-300001593538navi:FinancingReceivablesDelinquentLoansInRepaymentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-09-300001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:FinancingReceivablesCurrentMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2024-07-012024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesForbearanceLoansInRepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:ForbearanceMember2024-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:ChangeDuringPeriodFairValueDisclosureMember2024-12-310001593538navi:OpenMarketShareRepurchasesMembernavi:CommonStockSharesOutstandingMember2025-01-012025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2024-07-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueHedgingMember2025-01-012025-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:FFELPLoanABCPFacilitiesMember2024-12-310001593538navi:InterestExpenseAndDerivativeInstrumentsHedgingActivitiesMember2025-01-012025-09-300001593538navi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538navi:BusinessProcessingMembernavi:GovernmentServicesMember2024-01-012024-09-300001593538navi:PrivateEducationLoansMember2024-12-310001593538navi:BusinessProcessingMembernavi:GovernmentServicesMember2025-02-282025-02-280001593538navi:FFELPLoanABCPFacilitiesMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:FederalEducationLoansSegmentMember2024-07-012024-09-300001593538navi:OpenMarketShareRepurchasesMembernavi:CommonStockSharesOutstandingMember2024-07-012024-09-300001593538us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:ChangeDuringPeriodFairValueDisclosureMember2025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2025-07-012025-09-300001593538us-gaap:InterestRateSwapMember2025-01-012025-09-300001593538navi:SchoolDefermentMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:FederalGovernmentMembernavi:BusinessProcessingMember2024-01-012024-09-300001593538navi:InterestExpenseAndDerivativeInstrumentsHedgingActivitiesMember2024-01-012024-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMember2024-07-012024-09-300001593538navi:OpenMarketShareRepurchasesMembernavi:CommonStockSharesOutstandingMember2024-01-012024-09-300001593538navi:FinancingReceivablesDelinquentLoansInRepaymentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-01-012024-12-310001593538navi:CosignerLoanMember2025-09-300001593538navi:CommonStockSharesOutstandingMember2025-09-3000015935382024-01-012024-09-300001593538navi:RepaymentsMembernavi:SeasoningThirteenThruTwentyFourMember2024-09-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMembernavi:EducationLoanMember2024-01-012024-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2024-01-012024-09-300001593538us-gaap:NondesignatedMember2025-07-012025-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:InterestRateReductionAndExtendedMaturityMembernavi:PrivateEducationLoansMember2024-07-012024-09-300001593538navi:CertainLoanModificationsMember2025-09-300001593538us-gaap:ChangeDuringPeriodFairValueDisclosureMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:CrossCurrencyInterestRateContractMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2025-09-300001593538navi:PrivateEducationLoansMemberus-gaap:ContractualInterestRateReductionMember2024-07-012024-09-300001593538us-gaap:SubsequentEventMember2025-10-290001593538navi:EliminationsAndReconcilingItemsMembernavi:AdditionsSubtractionsForCoreToGaapAccountingMember2024-01-012024-09-300001593538navi:InterestRateReductionAndExtendedMaturityMembernavi:PrivateEducationLoansMember2024-01-012024-09-300001593538us-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2025-07-012025-09-300001593538navi:PrivateEducationLoansMember2025-09-300001593538navi:FFELPLoanABCPFacilitiesMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538navi:InterestExpenseAndDerivativeInstrumentsHedgingActivitiesMember2024-07-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:FinancingReceivablesCurrentMember2025-01-012025-09-300001593538navi:LoanStatusMember2024-09-300001593538us-gaap:RetainedEarningsMember2024-07-012024-09-300001593538us-gaap:CreditConcentrationRiskMembernavi:RepaymentMembernavi:FinancialAsset61To90DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:SeniorNotesDueDecemberFifteenTwoThousandFortyThreeMember2025-01-012025-09-300001593538navi:SeniorUnsecuredDebtMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-310001593538us-gaap:CommonStockMember2025-01-012025-09-300001593538navi:ConsumerLendingMember2024-12-310001593538navi:PrivateEducationLoansMemberus-gaap:ContractualInterestRateReductionMember2024-01-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:FinancingReceivables31To60DaysPastDueMember2024-09-300001593538us-gaap:RetainedEarningsMember2024-06-300001593538navi:FicoMember2025-09-300001593538us-gaap:TreasuryStockCommonMember2025-01-012025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivablesLoansInRepaymentMemberus-gaap:AccountsReceivableMember2024-01-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables90DaysPastDueMemberus-gaap:AccountsReceivableMember2025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueHedgingMember2025-01-012025-09-300001593538navi:ConsumerLendingSegmentMember2024-07-012024-09-300001593538us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2024-12-310001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-12-310001593538navi:PrivateEducationLoansMembernavi:ForbearanceMember2024-12-310001593538us-gaap:CommonStockMember2024-07-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables90DaysPastDueMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:AdditionalPaidInCapitalMember2023-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-06-300001593538navi:BusinessProcessingMemberus-gaap:OperatingSegmentsMember2024-01-012024-09-300001593538navi:SchoolGraceDefermentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2024-09-300001593538navi:LoanStatusMembernavi:SchoolOrGraceOrDefermentOrForbearanceMember2024-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:PrivateEducationLoanSecuritizationsMember2024-12-310001593538us-gaap:EstimateOfFairValueFairValueDisclosureMember2024-12-310001593538us-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables31To60DaysPastDueMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2024-09-300001593538navi:SchoolGraceDefermentMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:ChangeDuringPeriodFairValueDisclosureMemberus-gaap:CrossCurrencyInterestRateContractMember2024-12-310001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2025-06-300001593538us-gaap:TreasuryStockCommonMember2023-12-310001593538navi:FederalEducationLoansSegmentMember2025-07-012025-09-300001593538navi:FinancialAsset61To90DaysPastDueMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:CertainLoanModificationsMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2024-12-310001593538navi:CertainLoanModificationsMembernavi:ModifiedLoansMember2025-09-300001593538us-gaap:OtherContractMember2024-12-310001593538navi:BusinessProcessingMembernavi:HealthcareServicesMember2024-07-012024-09-300001593538navi:BelowSixFourZeroMembernavi:FicoMember2025-09-300001593538navi:EliminationsAndReconcilingItemsMembernavi:AdditionsSubtractionsForCoreToGaapAccountingMember2025-01-012025-09-300001593538us-gaap:CommonStockMember2024-06-300001593538navi:PrivateEducationLoansMembernavi:ForbearanceMember2025-09-300001593538us-gaap:InterestRateSwapMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2024-12-3100015935382024-12-310001593538us-gaap:InterestRateSwapMemberus-gaap:NondesignatedMember2025-01-012025-09-300001593538us-gaap:InterestRateSwapMember2025-06-300001593538navi:FicoMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:ShortTermDebtMember2025-09-300001593538navi:FinancialAsset90DaysPastDueMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMember2025-09-300001593538us-gaap:AdditionalPaidInCapitalMember2024-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2025-06-300001593538us-gaap:CrossCurrencyInterestRateContractMember2025-06-300001593538navi:BusinessProcessingMembernavi:StateAndLocalGovernmentMember2025-01-012025-09-300001593538navi:FinancialAsset90DaysPastDueMembernavi:PrivateEducationLoansMember2025-09-300001593538navi:NonCosignerLoanMembernavi:CosignersMember2024-09-300001593538navi:RehabLoansMemberus-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-09-300001593538us-gaap:UnsecuredDebtMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538us-gaap:OperatingSegmentsMembernavi:FederalEducationLoansSegmentMember2024-07-012024-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-01-012024-09-300001593538navi:AdjustmentsForCoreToGaapAccountingMembernavi:EliminationsAndReconcilingItemsMember2025-07-012025-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2025-01-012025-09-3000015935382024-07-012024-09-300001593538us-gaap:RetainedEarningsMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CrossCurrencyInterestRateContractMemberus-gaap:FairValueHedgingMember2024-01-012024-09-300001593538navi:PrivateEducationLoansMembernavi:FinancialAsset31To60DaysPastDueMember2024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables61To90DaysPastDueMemberus-gaap:AccountsReceivableMember2024-09-300001593538navi:OpenMarketShareRepurchasesMembernavi:CommonStockSharesOutstandingMember2025-07-012025-09-300001593538navi:EliminationsAndReconcilingItemsMembernavi:AdjustmentsForCoreToGaapAccountingMembernavi:NetImpactOfDerivativeAccountingMember2025-01-012025-09-300001593538us-gaap:EmployeeStockOptionMember2025-07-012025-09-300001593538navi:PrivateEducationLoanSecuritizationsRepurchaseFacilityMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMembernavi:FinancingReceivablesDelinquentLoansInRepaymentMemberus-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMember2024-01-012024-09-300001593538us-gaap:AccumulatedOtherComprehensiveIncomeMember2025-01-012025-09-300001593538us-gaap:CrossCurrencyInterestRateContractMember2025-07-012025-09-300001593538us-gaap:InterestRateSwapMember2025-09-300001593538navi:PrivateEducationLoanSecuritizationsMembernavi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538navi:SchoolTypeMembernavi:NotForProfitMember2024-09-300001593538us-gaap:RetainedEarningsMember2024-12-310001593538navi:BeforeHedgeAccountingAdjustmentsMember2025-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2025-07-012025-09-300001593538navi:LoansReceivableForPreviouslyFullyChargedOffLoansMembernavi:PrivateEducationLoansMember2024-12-310001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueHedgingMember2025-07-012025-09-300001593538navi:ConsumerLendingMemberus-gaap:OperatingSegmentsMember2024-07-012024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMemberus-gaap:FairValueHedgingMember2024-12-310001593538us-gaap:CreditConcentrationRiskMemberus-gaap:AccountsReceivableMembernavi:PrivateEducationLoansMembernavi:FinancingReceivablesCurrentMember2024-01-012024-12-310001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMember2025-09-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:RepaymentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:AccountsReceivableMember2024-09-300001593538us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2025-09-300001593538us-gaap:CommonStockMember2025-06-300001593538us-gaap:FederalFamilyEducationLoanProgramFfelpGuaranteedLoansMemberus-gaap:CreditConcentrationRiskMembernavi:FinancingReceivables90DaysPastDueMemberus-gaap:AccountsReceivableMember2024-12-310001593538navi:RepaymentsMembernavi:SeasoningThirtySevenThruFortyEightMember2024-09-300001593538us-gaap:OperatingSegmentsMembernavi:FederalEducationLoansSegmentMember2025-07-012025-09-300001593538us-gaap:VariableInterestEntityPrimaryBeneficiaryMembernavi:PrivateEducationLoansMember2024-12-310001593538navi:PrivateEducationLoansMember2023-12-310001593538us-gaap:AllOtherSegmentsMember2024-07-012024-09-300001593538navi:PrivateEducationLoanABCPFacilitiesMembernavi:BeforeHedgeAccountingAdjustmentsMember2024-12-31xbrli:purexbrli:sharesiso4217:USDxbrli:sharesnavi:Segmentiso4217:USD

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☑

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

or

☐

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36228

Navient Corporation

(Exact name of registrant as specified in its charter)

Delaware

46-4054283

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

 

 

13865 Sunrise Valley Drive, Herndon, Virginia 20171

(302) 283-8000

(Address of principal executive offices)

(Telephone Number)

(302) 283-8000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Securities registered pursuant to Section 12(b) of the Act.

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common stock, par value $.01 per share

 

NAVI

 

The NASDAQ Global Select Market

6% Senior Notes due December 15, 2043

 

JSM

 

The NASDAQ Global Select Market

Preferred Stock Purchase Rights

 

None

 

The NASDAQ Global Select Market

As of September 30, 2025, there were 97,506,705 shares of common stock outstanding.

 

 

 

 

 

img128417006_0.jpg

TABLE OF CONTENTS

Organization of Our Form 10-Q

The order and presentation of content in our Quarterly Report on Form 10-Q (Form 10-Q) differs from the traditional Securities and Exchange Commission (SEC) Form 10-Q format. Our format is designed to improve readability and to better present how we organize and manage our business. See Appendix A, "Form 10-Q Cross-Reference Index" for a cross-reference index to the traditional SEC Form 10-Q format.

 

Page

Number

 

Forward-Looking and Cautionary Statements

1

Use of Non-GAAP Financial Measures

2

 

 

Business

3

Overview and Fundamentals of Our Business

3

Recent Business Developments

5

How We Organize Our Business

5

 

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

7

Selected Historical Financial Information and Ratios

7

The Quarter in Review

8

Results of Operations

9

Segment Results

12

Financial Condition

19

Liquidity and Capital Resources

24

Critical Accounting Policies and Estimates

27

Non-GAAP Financial Measures

27

 

 

Legal Proceedings

37

Risk Factors

37

Quantitative and Qualitative Disclosures about Market Risk

38

 

 

Unregistered Sales of Equity Securities and Use of Proceeds

41

Controls and Procedures

42

Exhibits

43

Financial Statements

44

Signatures

79

Appendix A – Form 10-Q Cross-Reference Index

80

 

 

 

 

 

 

FORWARD-LOOKING AND CAUTIONARY STATEMENTS

This Form 10-Q contains “forward-looking” statements and other information that is based on management’s current expectations as of the date of this report. Statements that are not historical facts, including statements about our beliefs, opinions, or expectations and statements that assume or are dependent upon future events, are forward-looking statements and often contain words such as “expect,” “assume,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “may,” “could,” “should,” “goals,” or “target.” Such statements are based on management's expectations as of the date of this filing and involve many risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. Such risks and uncertainties are discussed more fully under the section titled “Risk Factors” and include, but are not limited to the following:

•
general economic conditions, including the potential impact of inflation and interest rates on Navient and its clients and customers and on the creditworthiness of third parties;
•
increased defaults on education loans held by us;
•
unanticipated repayment trends on education loans including prepayments or deferrals resulting from new interpretations or the timing of the execution and implementation of current laws, rules or regulations or future laws, executive orders or other policy initiatives that operate to encourage or require consolidation, abolish existing or create additional income-based repayment or debt forgiveness programs or establish other policies and programs which may increase or decrease the prepayment rates on education loans and accelerate or slow down the repayment of the bonds in our securitization trusts;
•
a reduction in our credit ratings;
•
changes to applicable laws, rules, regulations and government policies, as well as changing regulatory and governmental oversight;
•
changes in the general interest rate environment, including the availability of any relevant money-market index rate or the relationship between the relevant money-market index rate and the rate at which our assets are priced;
•
the interest rate characteristics of our assets do not always match those of our funding arrangements;
•
adverse market conditions or an inability to effectively manage our liquidity risk or access liquidity could negatively impact us;
•
the cost and availability of funding in the capital markets;
•
our ability to earn Floor Income and our ability to enter into hedges relative to that Floor Income are dependent on the future interest rate environment and therefore is variable;
•
our use of derivatives exposes us to credit and market risk;
•
our ability to continually and effectively align our cost structure with our business operations;
•
a failure or breach of our operating systems, infrastructure or information technology systems;
•
failure by any third party providing us material services or products or a breach or violation of law by one of these third parties;
•
our current or previous work with government clients exposes us to additional risks inherent in the government contracting environment;
•
acquisitions, strategic initiatives and investments or divestitures that we pursue;
•
shareholder activism; and
•
reputational risk and social factors.

 

 

Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this Form 10-Q and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business.

The preparation of our consolidated financial statements also requires management to make certain estimates and assumptions including estimates and assumptions about future events. These estimates or assumptions may prove to be incorrect and actual results could differ materially. All forward-looking statements contained in this report are qualified by these cautionary statements and are made only as of the date of this report. We do not undertake any obligation to update or revise these forward-looking statements except as required by law.

Through this discussion and analysis, we intend to provide the reader with some narrative context for how our management views our consolidated financial statements, additional context within which to assess our operating results, and information on the quality and variability of our earnings, liquidity and cash flows.

 

1

 

USE OF NON-GAAP FINANCIAL MEASURES

We prepare financial statements and present financial results in accordance with GAAP. However, we also evaluate our business segments and present our financial results on a basis that differs from GAAP. We refer to this different basis of presentation as Core Earnings, which is a non-GAAP financial measure. We provide this Core Earnings basis of presentation on a consolidated basis and for each business segment because this is what we review internally when making management decisions regarding our performance and how we allocate resources. We also include this information in our presentations with credit rating agencies, lenders and investors. Because our Core Earnings basis of presentation is our measure of profit or loss for our segments, we are required by GAAP to provide Core Earnings disclosures in the notes to our consolidated financial statements for our business segments.

In addition to Core Earnings, we present the following other non-GAAP financial measures: Tangible Equity, Adjusted Tangible Equity Ratio, Earnings before Interest, Taxes, Depreciation and Amortization Expense (EBITDA) (for the Business Processing segment), and Allowance for Loan Losses Excluding Expected Future Recoveries on Previously Fully Charged-off Loans. Definitions for the non-GAAP financial measures and reconciliations are provided below, except that reconciliations of forward-looking non-GAAP financial measures are not provided because the Company is unable to provide such reconciliations without unreasonable effort due to the uncertainty and inherent difficulty of predicting the occurrence and financial impact of certain items, including, but not limited to, the impact of any mark-to-market gains/losses resulting from our use of derivative instruments to hedge our economic risks. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-GAAP Financial Measures” for a further discussion and a complete reconciliation between GAAP net income and Core Earnings.

 

2

 

Business

Overview and Fundamentals of Our Business

Navient (Nasdaq: NAVI) helps students and families confidently manage the cost of higher education. We create long-term value for customers and investors through responsible lending, flexible refinancing, trusted servicing oversight, and decades of portfolio management expertise. Our employees thrive in a culture of belonging, where they are supported and proud to deliver meaningful outcomes. Learn more on Navient.com.

With a focus on data-driven insights, service, compliance and innovative support, Navient’s business consists of:

 

img128417006_1.jpg

 

•
Federal Education Loans

We own and manage a portfolio of $28.9 billion of federally guaranteed Federal Family Education Loan Program (FFELP) Loans. We support the success of our customers and ensure a compliant, efficient customer experience.

•
Consumer Lending

We own and manage a portfolio of $15.5 billion of Private Education Loans. Through our Earnest brand we also refinance and originate Private Education Loans. We help students and families succeed through the college journey with innovative planning tools, student loans and refinancing products through our Earnest brand. In the first nine months of 2025, we originated $1.8 billion of Private Education Loans, a 73% increase from $1.0 billion a year ago.

 

Navient previously provided both healthcare and government business processing services. Our healthcare services business was sold in September 2024 and our government services business was sold in February 2025, marking the end of Navient providing business processing solutions. See "Recent Business Developments" for more detail.

 

Maximizing Cash Flows from Loan Portfolios and Maintaining a Strong Balance Sheet

 

The cash flows from our education loan portfolios continue to demonstrate the strength of our balance sheet, our efficient financings, credit risk management and underwriting of high-quality private education loans with attractive economics.

 

By optimizing capital adequacy and allocating capital to highly accretive opportunities, including organic growth and acquisitions, we remain well positioned to pay dividends and repurchase stock, while maintaining appropriate leverage that supports our credit ratings and ensures ongoing access to capital markets.

 

In December 2021, our Board of Directors approved a share repurchase program authorizing the purchase of up to $1 billion of the Company’s outstanding common stock and in October 2025 the Board authorized a new $100 million share repurchase program. The new share repurchase authorization, which is effective immediately, is in addition to the approximately $26 million of unused authorization as of September 30, 2025.

 

3

 

To inform our capital allocation decisions, we use the Adjusted Tangible Equity Ratio(1) in addition to other metrics. Our GAAP equity-to-asset ratio was 4.9% and our Adjusted Tangible Equity Ratio(1) was 9.3% as of September 30, 2025.

 

 

(Dollars and shares in millions)

 

Q3-25

 

 

Q3-24

 

Shares repurchased

 

 

2.0

 

 

 

2.1

 

Reduction in shares outstanding

 

 

2

%

 

 

2

%

Total repurchases in dollars

 

$

26

 

 

$

33

 

Dividends paid

 

$

16

 

 

$

17

 

Total Capital Returned(2)

 

$

42

 

 

$

50

 

GAAP equity-to-asset ratio

 

 

4.9

%

 

 

5.0

%

Adjusted Tangible Equity Ratio(1)

 

 

9.3

%

 

 

9.8

%

 

Commitment to Corporate Social Responsibility and Compliance

We maintain a robust, multi-layered compliance management system and thoroughly understand and comply with applicable federal, state, and local laws. We follow the industry-leading “Three Lines Model” compliance framework. This framework and other compliance protocols ensure we adhere to key industry laws and regulations including but not limited to: Fair and Accurate Credit Transactions Act (FACTA); Fair Credit Reporting Act (FCRA); Fair Debt Collection Practices Act (FDCPA); Electronic Funds Transfer Act (EFTA); Equal Credit Opportunity Act (ECOA); Gramm-Leach-Bliley Act (GLBA); Health Insurance Portability and Accountability Act (HIPAA); IRS Publication 1075; Servicemembers Civil Relief Act (SCRA); Military Lending Act (MLA); Telephone Consumer Protection Act (TCPA); Truth in Lending Act (TILA); Unfair, Deceptive, or Abusive Acts and Practices (UDAAP); state laws; and state and city licensing.

We are committed to contributing to the social and economic wellbeing of our communities; fostering the success of our customers; supporting a culture of integrity and inclusion in our workforce; and embracing sustainable business practices. Navient has earned recognition from a variety of leading organizations for our continued commitment to social responsibility. Our employees are engaged in our communities through company-sponsored volunteering and philanthropic programs.

Navient is committed to a sustainable future. We leverage technologies that minimize energy use in our office buildings and promote widespread adoption of “paperless” digital customer communications. Navient prioritizes the usage of power-saving features to our buildings to reduce energy usage. Energy efficiency and reducing carbon dioxide (CO2) and CO2 equivalents are among the many factors considered in our real estate decisions.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)
Item is a non-GAAP financial measure. For a description and reconciliation, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-GAAP Financial Measures.”
(2)
Capital Returned is defined as share repurchases and dividends paid.

4

 

Recent Business Developments

On January 30, 2024, as a result of an in-depth review of our business, Navient announced strategic actions to simplify our company, reduce our expense base, and enhance our flexibility. We have made substantial progress on these actions. We adopted a variable, outsourced servicing model when MOHELA began servicing our loan portfolio in July 2024. We completed the divestiture of our Business Processing segment business with our healthcare services business sold in September 2024 and our government services business sold in February 2025. In conjunction with the decision to outsource student loan servicing, divesting the Business Processing segment increased the opportunities for shared cost reduction. Along with the above actions, we are also reshaping our shared services functions and corporate footprint to align with the needs of a more focused, flexible and streamlined company. The $46 million of restructuring and other reorganization charges recognized in 2024 and the first nine months of 2025 (the vast majority of which relates to severance in connection with job abolishments) reflects the progress made to date in connection with this effort. As of September 30, 2025, we have reduced our headcount by over 80% since the beginning of 2024.

In 2025, as it relates to the above strategic actions:

•
We provided transition services related to the outsourcing of loan servicing and divestiture of the Business Processing segment. The transition services related to the outsourcing of loan servicing and the sale of our healthcare services business ended in May 2025 and as of October 2025 we have no further obligations to provide transition services for our government services business.
•
We have had and expect to have additional cost saving initiatives implemented which will further reduce our operating costs mostly in connection with our shared service functions and corporate footprint.
•
We are executing on enhancing the value of our growth business related to in-school and refinance Private Education Loan originations, investing in capabilities to grow high-quality originations that generate targeted returns. In the first nine months of 2025, total originations nearly doubled to $1.8 billion compared to $1.0 billion a year ago.

 

How We Organize Our Business

Today we operate our business in two primary segments: Federal Education Loans and Consumer Lending. As of February 2025, we had divested our Business Processing segment.

img128417006_2.jpg

5

 

Federal Education Loans Segment

Navient owns and manages FFELP Loans and is the master servicer on this portfolio. We generate revenue primarily through net interest income on our FFELP Loans.

Consumer Lending Segment

Navient owns and manages Private Education Loans and is the master servicer for these portfolios. Through our Earnest brand, we also refinance and originate in-school Private Education Loans. "Refinance" Private Education Loans are loans where a borrower has refinanced their education loans, and "In-school" Private Education Loans are loans originally made to borrowers while they are attending school. We generate revenue primarily through net interest income on our Private Education Loan portfolio.

Through our Earnest brand, we help students and families in the planning and paying for college journey. Our digital tools empower people to find scholarships and compare financial aid offers. We believe our 50 years of experience, product design, digital marketing strategies, and origination and servicing expertise provide a unique competitive advantage. We see meaningful growth opportunities in originating Private Education Loans, generating attractive long-term, risk-adjusted returns.

The passage of new legislation on July 3, 2025 (the "Big Beautiful Bill") marks a significant shift in federal student lending programs, notably eliminating the GradPLUS loan program effective July 1, 2026. This development is anticipated to drive increased demand for private in-school graduate loans, presenting a unique loan origination growth opportunity for Navient. With our disciplined approach to growing in-school volume with a focus on graduate borrowers, we are well-positioned to capture our share of this expanded market.

Business Processing Segment

In September 2024, Navient completed the sale of Xtend, which comprised the Company's healthcare services business in its Business Processing segment. In February 2025, Navient completed the sale of its government services businesses, which constitutes the remainder of the Business Processing segment.

Prior to the sale of its healthcare and government services businesses, Navient provided business processing solutions such as omnichannel contact center services, workflow processing, and revenue cycle optimization. We leveraged the same expertise and intelligent tools we use to deliver successful results for portfolios we own. Our support enabled our clients to ensure better constituent outcomes, meet rapidly changing needs, improve technology, reduce operating expenses, manage risk and optimize revenue opportunities. Our clients included:

•
Government: We offered our solutions to federal agencies, state governments, tolling and parking authorities, and other public sector clients.
•
Healthcare: Our clients included hospitals, hospital systems, medical centers, large physician groups, other healthcare providers and public health departments.

Other Segment

This segment consists of our corporate liquidity portfolio, gains and losses incurred on the repurchase of debt, unallocated expenses of shared services (which includes regulatory expenses), and restructuring/other reorganization expenses. Additionally, the segment contains the revenue and expenses in connection with the transition services we have performed related to the outsourcing of loan servicing and divestiture of our Business Processing segment discussed under "Recent Business Developments."

6

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Selected Historical Financial Information and Ratios

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(In millions, except per share data)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

GAAP Basis

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(86

)

 

$

(2

)

 

$

(75

)

 

$

107

 

Diluted earnings (loss) per common share

 

$

(.87

)

 

$

(.02

)

 

$

(.75

)

 

$

.95

 

Weighted average shares used to compute diluted
   earnings per share

 

 

98

 

 

 

108

 

 

 

100

 

 

 

112

 

Return on assets

 

 

(.72

)%

 

 

(.02

)%

 

 

(0.21

)%

 

 

.26

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Core Earnings Basis(1)

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)(1)

 

$

(83

)

 

$

160

 

 

$

(36

)

 

$

246

 

Diluted earnings (loss) per common share(1)

 

$

(.84

)

 

$

1.45

 

 

$

(.36

)

 

$

2.20

 

Weighted average shares used to compute diluted
   earnings per share

 

 

98

 

 

 

110

 

 

 

100

 

 

 

112

 

Net interest margin, Federal Education Loans segment

 

 

.84

%

 

 

.46

%

 

 

.72

%

 

 

.46

%

Net interest margin, Consumer Lending segment

 

 

2.39

%

 

 

2.84

%

 

 

2.48

%

 

 

2.91

%

Return on assets

 

 

(.69

)%

 

 

1.21

%

 

 

(.10

)%

 

 

.59

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Education Loan Portfolios

 

 

 

 

 

 

 

 

 

 

 

 

Ending FFELP Loans, net

 

$

28,952

 

 

$

31,522

 

 

$

28,952

 

 

$

31,522

 

Ending Private Education Loans, net

 

 

15,456

 

 

 

16,005

 

 

 

15,456

 

 

 

16,005

 

Ending total education loans, net

 

$

44,408

 

 

$

47,527

 

 

$

44,408

 

 

$

47,527

 

Average FFELP Loans

 

$

29,641

 

 

$

32,373

 

 

$

30,289

 

 

$

34,749

 

Average Private Education Loans

 

 

15,894

 

 

 

16,587

 

 

 

16,014

 

 

 

16,968

 

Average total education loans

 

$

45,535

 

 

$

48,960

 

 

$

46,303

 

 

$

51,717

 

(1)
Item is a non-GAAP financial measure. For a description and reconciliation, see “Non-GAAP Financial Measures – Core Earnings.”

7

 

The Quarter in Review

We prepare financial statements and present financial results in accordance with GAAP. However, we also evaluate our business segments and present financial results on a basis that differs from GAAP. We refer to this different basis of presentation as Core Earnings. We provide this Core Earnings basis of presentation on a consolidated basis and for each business segment because this is what we review internally when making management decisions regarding our performance and how we allocate resources. We also include this information in our presentations with credit rating agencies, lenders and investors. Because our Core Earnings basis of presentation corresponds to our segment financial presentations, we are required by GAAP to provide certain Core Earnings disclosures in the notes to our consolidated financial statements for our business segments. See “Non-GAAP Financial Measures — Core Earnings” for a further discussion and a complete reconciliation between GAAP net income and Core Earnings.

Third-quarter 2025 net loss was $86 million ($0.87 diluted loss per share), compared with net loss of $2 million ($0.02 diluted loss per share) for the year-ago quarter. See “Results of Operations — GAAP Comparison of Third-Quarter 2025 Results with Third-Quarter 2024” for a discussion of the primary contributors to the change in GAAP earnings between periods.

Third-quarter 2025 Core Earnings net loss was $83 million ($0.84 diluted Core Earnings loss per share), compared with $160 million ($1.45 diluted Core Earnings per share) for the year-ago quarter. See “Segment Results” for a discussion of the primary contributors to the change in Core Earnings between periods.

GAAP and Core Earnings results included:

•
$168 million provision for loan losses ($13 million for FFELP and $155 million for Consumer Lending). Of the $168 million, $17 million relates to originations with the remaining $151 million ($1.17 diluted loss per share) a result of elevated delinquency balances, our forecasted macroeconomic outlook as well as the extension of the FFELP portfolio.
•
$11 million ($0.08 diluted earnings per share) net benefit to net interest income from a decrease in prepayment rate assumptions ($18 million of additional net interest income from the FFELP Loan portfolio partially offset by a $7 million reduction in the Private Education Loan portfolio).
•
$5 million ($0.04 diluted loss per share) of regulatory and restructuring expenses.

Financial highlights of third-quarter 2025 include:

Federal Education Loans segment:

•
Net income of $35 million.
•
Net interest margin of 0.84%.
•
FFELP Loan prepayments of $268 million compared to $1.0 billion in third-quarter 2024.

Consumer Lending segment:

•
Net loss of $76 million due to the elevated provision discussed above.
•
Net interest margin of 2.39%.
•
Originated $788 million of Private Education Loans, a 58% increase.

Business Processing segment:

•
Navient no longer provides business processing segment services after the sale in February 2025 of the government services business.

Capital, funding and liquidity:

•
GAAP equity-to-asset ratio of 4.9% and adjusted tangible equity ratio(1) of 9.3%.
•
Repurchased $26 million of common shares. Authorized new $100 million share repurchase program. The share repurchase authorization, which is effective immediately, is in addition to the approximately $26 million of unused authorization as of September 30, 2025.
•
Paid $16 million in common stock dividends.
•
Issued $543 million of asset-backed securities.

 

 

 

(1)
Item is a non-GAAP financial measure. For a description and reconciliation, see “Non-GAAP Financial Measures.”

8

 

 

Operating Expenses:

•
Operating expenses of $105 million, of which $6 million is in connection with transition services we have provided related to our various strategic initiatives. There is $7 million of revenue recognized in Other revenue related to these services.

The transition services related to the outsourcing of loan servicing and the sale of our healthcare services business ended in May 2025 and as of October 2025 we have no further obligations to provide transition services for our government services business.

 

 

Results of Operations

GAAP Income Statements (Unaudited)

 

 

Three Months Ended September 30,

 

 

Increase
(Decrease)

 

 

Nine Months Ended September 30,

 

 

Increase
(Decrease)

 

(In millions, except per share data)

 

2025

 

 

2024

 

 

$

 

 

%

 

 

2025

 

 

2024

 

 

$

 

 

%

 

Interest income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFELP Loans

 

$

484

 

 

$

591

 

 

$

(107

)

 

 

(18

)%

 

$

1,459

 

 

$

1,861

 

 

$

(402

)

 

 

(22

)%

Private Education Loans

 

 

276

 

 

 

314

 

 

 

(38

)

 

 

(12

)

 

 

838

 

 

 

958

 

 

 

(120

)

 

 

(13

)

Cash and investments

 

 

21

 

 

 

43

 

 

 

(22

)

 

 

(51

)

 

 

64

 

 

 

129

 

 

 

(65

)

 

 

(50

)

Total interest income

 

 

781

 

 

 

948

 

 

 

(167

)

 

 

(18

)

 

 

2,361

 

 

 

2,948

 

 

 

(587

)

 

 

(20

)

Total interest expense

 

 

639

 

 

 

828

 

 

 

(189

)

 

 

(23

)

 

 

1,961

 

 

 

2,547

 

 

 

(586

)

 

 

(23

)

Net interest income

 

 

142

 

 

 

120

 

 

 

22

 

 

 

18

 

 

 

400

 

 

 

401

 

 

 

(1

)

 

 

—

 

Less: provisions for loan losses

 

 

168

 

 

 

42

 

 

 

126

 

 

 

300

 

 

 

236

 

 

 

68

 

 

 

168

 

 

 

247

 

Net interest income (loss) after
   provisions for loan losses

 

 

(26

)

 

 

78

 

 

 

(104

)

 

 

(133

)

 

 

164

 

 

 

333

 

 

 

(169

)

 

 

(51

)

Other income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Servicing revenue

 

 

13

 

 

 

13

 

 

 

—

 

 

 

-

 

 

 

40

 

 

 

48

 

 

 

(8

)

 

 

(17

)

Asset recovery and business
    processing revenue

 

 

—

 

 

 

70

 

 

 

(70

)

 

 

(100

)

 

 

23

 

 

 

228

 

 

 

(205

)

 

 

(90

)

Other income

 

 

10

 

 

 

10

 

 

 

—

 

 

 

-

 

 

 

44

 

 

 

22

 

 

 

22

 

 

 

100

 

Gain on sale of subsidiary

 

 

—

 

 

 

219

 

 

 

(219

)

 

 

(100

)

 

 

—

 

 

 

219

 

 

 

(219

)

 

 

(100

)

Gains (losses) on derivative and
    hedging activities, net

 

 

(4

)

 

 

(36

)

 

 

32

 

 

 

(89

)

 

 

(34

)

 

 

11

 

 

 

(45

)

 

 

(409

)

Total other income

 

 

19

 

 

 

276

 

 

 

(257

)

 

 

(93

)

 

 

73

 

 

 

528

 

 

 

(455

)

 

 

(86

)

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Operating expenses

 

 

105

 

 

 

184

 

 

 

(79

)

 

 

(43

)

 

 

333

 

 

 

533

 

 

 

(200

)

 

 

(38

)

   Goodwill and acquired intangible
      assets impairment and
      amortization expense

 

 

1

 

 

 

140

 

 

 

(139

)

 

 

(99

)

 

 

2

 

 

 

145

 

 

 

(143

)

 

 

(99

)

   Restructuring/other
      reorganization expenses

 

 

4

 

 

 

18

 

 

 

(14

)

 

 

(78

)

 

 

6

 

 

 

35

 

 

 

(29

)

 

 

(83

)

Total expenses

 

 

110

 

 

 

342

 

 

 

(232

)

 

 

(68

)

 

 

341

 

 

 

713

 

 

 

(372

)

 

 

(52

)

Income (loss) before income tax expense (benefit)

 

 

(117

)

 

 

12

 

 

 

(129

)

 

 

(1,075

)

 

 

(104

)

 

 

148

 

 

 

(252

)

 

 

(170

)

Income tax expense (benefit)

 

 

(31

)

 

 

14

 

 

 

(45

)

 

 

(321

)

 

 

(29

)

 

 

41

 

 

 

(70

)

 

 

(171

)

Net income (loss)

 

$

(86

)

 

$

(2

)

 

$

(84

)

 

 

4,200

%

 

$

(75

)

 

$

107

 

 

$

(182

)

 

 

(170

)%

Basic earnings (loss) per
   common share

 

$

(.87

)

 

$

(.02

)

 

$

(.85

)

 

 

4,250

%

 

$

(.75

)

 

$

.97

 

 

$

(1.72

)

 

 

(177

)%

Diluted earnings (loss) per
   common share

 

$

(.87

)

 

$

(.02

)

 

$

(.85

)

 

 

4,250

%

 

$

(.75

)

 

$

.95

 

 

$

(1.70

)

 

 

(179

)%

Dividends per common share

 

$

.16

 

 

$

.16

 

 

$

—

 

 

 

—

 

 

$

.48

 

 

$

.48

 

 

$

—

 

 

 

—

 

 

9

 

GAAP Comparison of Third-Quarter 2025 Results with Third-Quarter 2024

For the three months ended September 30, 2025, net loss was $86 million, or $0.87 diluted loss per common share, compared with net loss of $2 million, or $0.02 diluted loss per common share, for the year-ago period.

The primary contributors to the change in net income (loss) are as follows:

• Net interest income increased by $22 million primarily due to a decrease in premium amortization due to both a decrease in prepayment rate assumptions ($11 million net benefit in the current period), mostly in response to the significant decline in FFELP Loan actual prepayments since the beginning of 2025, as well as the significant decline in actual FFELP Loan prepayments from $1.0 billion in the year-ago quarter to $268 million in the current quarter. Additionally, there was a $12 million increase in mark-to-market gains on fair value hedges recorded in interest expense. These increases were partially offset by the paydown of the FFELP and Private Education Loan portfolios.

• Provisions for loan losses increased $126 million from $42 million to $168 million:

○ The provision for FFELP Loan losses increased $18 million from $(5) million to $13 million.

○ The provision for Private Education Loan losses increased $108 million from $47 million to $155 million.

The provision for FFELP Loan losses of $13 million in the current period was primarily the result of elevated delinquency balances, our forecasted macroeconomic outlook, as well as the continued extension of the portfolio. The provision of $(5) million in the year-ago quarter was the result of relatively stable credit trends.

The provision for Private Education Loan losses of $155 million in the current period included $17 million associated with loan originations and $138 million primarily the result of elevated delinquency balances as well as our forecasted macroeconomic outlook. The provision of $47 million in the year-ago quarter included $21 million related to lowering the expected recovery rate on defaulted loans, $15 million associated with loan originations and $11 million related to a general reserve build.

• Asset recovery and business processing revenue decreased $70 million as a result of the sale of our healthcare services business in the third quarter of 2024 ($28 million of the decrease), and our government services business in February 2025 ($42 million of the decrease). With the sale of our government services business, Navient no longer provides business processing segment services.

• A gain of $219 million was recognized in the third quarter of 2024 from the sale of 100% of our equity interests in Xtend Healthcare, our former healthcare services business, for $369 million cash on September 19, 2024.

• Net losses on derivative and hedging activities decreased $32 million. The primary factor affecting the change was interest rate fluctuations. Valuations of derivative instruments fluctuate based upon many factors including changes in interest rates and other market factors. As a result, net gains and losses on derivative and hedging activities may vary significantly in future periods.

• Operating expenses decreased $79 million, $66 million of which was due to a decline in business processing expenses as a result of the sale of our government services business in February 2025 and our healthcare services business in the third quarter of 2024 ($57 million of the reduction is in the Business Processing segment and $9 million of the reduction is in the Other segment). In addition, regulatory-related expenses decreased $13 million primarily due to $18 million of regulatory-related expenses recorded in the year-ago quarter in connection with the September 2024 CFPB settlement agreement. Current period expense includes $6 million incurred in connection with providing transition services related to our various strategic initiatives. There is $7 million of revenue recognized in the Other segment related to these services.

• Goodwill and acquired intangible asset impairment and amortization expense decreased $139 million due to a $138 million impairment recognized in the third quarter of 2024 related to the government services business which was sold in February 2025.

• Restructuring and other reorganization expenses decreased $14 million primarily due to a decrease in severance-related costs incurred in connection with the various strategic initiatives that have been and continue to be implemented to simplify the company, reduce our expense base and enhance our flexibility.

• The effective income tax rates for the current and year-ago quarters were 27% and 120%, respectively. The movement in the effective income tax rate was primarily driven by the settlement with the CFPB in the year-ago quarter of which a portion was not deductible for tax and the impact of a portion of the goodwill impairment recorded in the year-ago quarter not being deductible.

 

10

 

We repurchased 2.0 million and 2.1 million shares of our common stock during the third quarters of 2025 and 2024, respectively. As a result of repurchases, our average outstanding diluted shares decreased by 10 million common shares (or 9%) from the year-ago period.

 

GAAP Comparison of Nine Months Ended September 30, 2025 Results with Nine Months Ended September 30, 2024

For the nine months ended September 30, 2025, net loss was $75 million, or $0.75 diluted loss per common share, compared with net income of $107 million, or $0.95 diluted earnings per common share, for the year-ago period.

The primary contributors to the change in net income (loss) are as follows:

• Net interest income decreased by $1 million primarily as a result of the paydown of the FFELP and Private Education Loan portfolios and the impact of decreasing interest rates on the different index resets for the FFELP Loan and Private Education Loan assets and debt. These decreases were offset by a $54 million decline in net premium amortization on the loan portfolios due to both a decrease in prepayment rate assumptions, mostly in response to the significant decline in actual FFELP Loan prepayments since the beginning of 2025, as well as the significant decline in actual FFELP Loan prepayments from $5.0 billion in the year-ago period to $753 million in the current period.

• Provisions for loan losses increased $168 million, from $68 million to $236 million:

○ The provision for FFELP Loan losses increased $35 million from $(6) million to $29 million.

○ The provision for Private Education Loan losses increased $133 million from $74 million to $207 million.

The provision for FFELP Loan losses of $29 million in the current period was primarily the result of elevated delinquency balances, our forecasted macroeconomic outlook, as well as the continued extension of the portfolio. The provision of $(6) million in the year-ago period was the result of relatively stable credit trends.

The provision for Private Education Loan losses of $207 million in the current period included $32 million associated with loan originations and $175 million primarily the result of elevated delinquency balances as well as our forecasted macroeconomic outlook. The provision of $74 million in the year-ago period included $21 million related to lowering the expected recovery rate on defaulted loans, $26 million associated with loan originations and $27 million related to a general reserve build.

• Asset recovery and business processing revenue decreased $205 million as a result of the sale of our healthcare services business in the third quarter of 2024 ($88 million of the decrease), and our government services business in February 2025 ($117 million of the decrease). With the sale of our government services business, Navient no longer provides business processing segment services.

• Other income increased $22 million primarily related to the transition services we provide related to our various strategic initiatives. The transition services related to the outsourcing of loan servicing and the sale of our healthcare services business ended in May 2025. The transition services related to the sale of our government services business ended in October 2025.

• A gain of $219 million was recognized in the third quarter of 2024 from the sale of 100% of our equity interests in Xtend Healthcare, our former healthcare services business, for $369 million cash on September 19, 2024.

• Net gains on derivative and hedging activities decreased $45 million. The primary factor affecting the change was interest rate fluctuations. Valuations of derivative instruments fluctuate based upon many factors including changes in interest rates and other market factors. As a result, net gains and losses on derivative and hedging activities may vary significantly in future periods.

• Operating expenses decreased $200 million, $198 million of which was due to a decline in business processing expenses as a result of the sale of our government services business in February 2025 and our healthcare services business in the third quarter of 2024 ($168 million of the reduction is in the Business Processing segment and $30 million of the reduction is in the Other segment). In addition, regulatory-related expenses decreased $34 million primarily due to $39 million of regulatory-related expenses recorded in the year-ago period in connection with the September 2024 CFPB settlement agreement. Current period expense includes $29 million incurred in connection with providing transition services related to our various strategic initiatives. There is $32 million of revenue recognized in the Other segment related to these services.

• Goodwill and acquired intangible asset impairment and amortization expense decreased $143 million primarily due to a $138 million impairment recognized in September 2024 related to the government services business which was sold in February 2025.

• Restructuring and other reorganization expenses decreased $29 million primarily due to a decrease in severance-related costs incurred in connection with the various strategic initiatives that have been and continue to be implemented to simplify the company, reduce our expense base and enhance our flexibility.

11

 

We repurchased 6.4 million and 7.2 million shares of our common stock during the nine months ended September 30, 2025 and 2024, respectively. As a result of repurchases, our average outstanding diluted shares decreased by 12 million common shares (or 11%) from the year-ago period.

 

Segment Results

Federal Education Loans Segment

The following table presents Core Earnings results for our Federal Education Loans segment.

 

 

Three Months Ended September 30,

 

 

% Increase
(Decrease)

 

 

Nine Months Ended September 30,

 

 

% Increase
(Decrease)

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025 vs. 2024

 

 

2025

 

 

2024

 

 

2025 vs. 2024

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFELP Loans

 

$

484

 

 

$

591

 

 

 

(18

)%

 

$

1,459

 

 

$

1,861

 

 

 

(22

)%

Cash and investments

 

 

10

 

 

 

25

 

 

 

(60

)

 

 

30

 

 

 

75

 

 

 

(60

)

Total interest income

 

 

494

 

 

 

616

 

 

 

(20

)

 

 

1,489

 

 

 

1,936

 

 

 

(23

)

Total interest expense

 

 

429

 

 

 

576

 

 

 

(26

)

 

 

1,321

 

 

 

1,810

 

 

 

(27

)

Net interest income

 

 

65

 

 

 

40

 

 

 

63

 

 

 

168

 

 

 

126

 

 

 

33

 

Less: provision for loan
   losses

 

 

13

 

 

 

(5

)

 

 

360

 

 

 

29

 

 

 

(6

)

 

 

583

 

Net interest income after
   provision for loan losses

 

 

52

 

 

 

45

 

 

 

16

 

 

 

139

 

 

 

132

 

 

 

5

 

Total other income

 

 

10

 

 

 

11

 

 

 

(9

)

 

 

31

 

 

 

44

 

 

 

(30

)

Direct operating expenses

 

 

16

 

 

 

20

 

 

 

(20

)

 

 

54

 

 

 

53

 

 

 

2

 

Income before income tax
   expense

 

 

46

 

 

 

36

 

 

 

28

 

 

 

116

 

 

 

123

 

 

 

(6

)

Income tax expense

 

 

11

 

 

 

9

 

 

 

22

 

 

 

27

 

 

 

28

 

 

 

(4

)

Net income

 

$

35

 

 

$

27

 

 

 

30

%

 

$

89

 

 

$

95

 

 

 

(6

)%

Comparison of Third-Quarter 2025 Results with Third-Quarter 2024

•
Net income was $35 million compared to $27 million.
•
Net interest income increased $25 million primarily due to a decrease in premium amortization as a result of both a decrease in prepayment rate assumptions ($18 million benefit in current quarter), in response to the significant decline in actual prepayments since the beginning of 2025, as well as the significant decline in actual prepayments from $1.0 billion in the year-ago quarter to $268 million in the current quarter. This was partially offset by the paydown of the loan portfolio.
•
Provision for loan losses increased $18 million. The $13 million of provision for loan losses in the current period was primarily the result of elevated delinquency balances, our forecasted macroeconomic outlook as well as the continued extension of the portfolio. The $(5) million of provision for loan losses in third-quarter 2024 was the result of relatively stable credit trends.
o
Net charge-offs were unchanged at $9 million.
o
Delinquencies greater than 90 days were $2.5 billion compared to $1.9 billion.
o
Forbearances were $3.7 billion compared to $5.0 billion.
•
Expenses were $4 million lower primarily as a result of the outsourcing of the loan servicing of our portfolio to a third party on July 1, 2024. This created a variable cost structure resulting in the significant reduction in expenses (20%) as the portfolio paid down.

 

12

 

Key performance metrics are as follows:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Segment net interest margin

 

 

.84

%

 

 

.46

%

 

 

.72

%

 

 

.46

%

FFELP Loans:

 

 

 

 

 

 

 

 

 

 

 

 

      FFELP Loan spread

 

 

.90

%

 

 

.60

%

 

 

.77

%

 

 

.59

%

      Provision for loan losses

 

$

13

 

 

$

(5

)

 

$

29

 

 

$

(6

)

      Net charge-offs

 

$

9

 

 

$

9

 

 

$

23

 

 

$

29

 

      Net charge-off rate

 

 

.15

%

 

 

.14

%

 

 

.13

%

 

 

.14

%

      Greater than 30-days delinquency rate

 

 

18.1

%

 

 

13.4

%

 

 

18.1

%

 

 

13.4

%

      Greater than 90-days delinquency rate

 

 

10.5

%

 

 

7.3

%

 

 

10.5

%

 

 

7.3

%

      Forbearance rate

 

 

13.4

%

 

 

16.4

%

 

 

13.4

%

 

 

16.4

%

      Average FFELP Loans

 

$

29,641

 

 

$

32,373

 

 

$

30,289

 

 

$

34,749

 

      Ending FFELP Loans, net

 

$

28,952

 

 

$

31,522

 

 

$

28,952

 

 

$

31,522

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest Margin

The following table details the net interest margin.

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2025

 

 

2024

 

 

2025

 

 

2024

 

FFELP Loan yield

 

 

6.31

%

 

 

7.04

%

 

 

6.22

%

 

 

6.92

%

Floor Income

 

 

.17

 

 

 

.23

 

 

 

.22

 

 

 

.23

 

FFELP Loan net yield

 

 

6.48

 

 

 

7.27

 

 

 

6.44

 

 

 

7.15

 

FFELP Loan cost of funds

 

 

(5.58

)

 

 

(6.67

)

 

 

(5.67

)

 

 

(6.56

)

FFELP Loan spread

 

 

.90

 

 

 

.60

 

 

 

.77

 

 

 

.59

 

Other interest-earning asset spread impact

 

 

(.06

)

 

 

(.14

)

 

 

(.05

)

 

 

(.13

)

Net interest margin(1)

 

 

.84

%

 

 

.46

%

 

 

.72

%

 

 

.46

%

(1)
The average balances of the interest-earning assets for the respective periods are:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

FFELP Loans

 

$

29,641

 

 

$

32,373

 

 

$

30,289

 

 

$

34,749

 

Other interest-earning assets

 

 

872

 

 

 

1,956

 

 

 

874

 

 

 

2,002

 

Total FFELP Loan interest-earning assets

 

$

30,513

 

 

$

34,329

 

 

$

31,163

 

 

$

36,751

 

 

 

The 38 basis point increase in the net interest margin in third-quarter 2025 is primarily the result of loan premium amortization being $29 million lower in the current period (38 basis points) due to both a decrease in prepayment rate assumptions used to amortize loan premium, in response to the significant decline in actual prepayments since the beginning of 2025, as well as the significant decline in actual prepayments from $1.0 billion in the year-ago quarter to $268 million in the current quarter. The significant decline in actual prepayments in 2025 is primarily the result of changes in public policy under the current Administration.

As of September 30, 2025, our FFELP Loan portfolio totaled $28.9 billion. The weighted-average life of this portfolio as of September 30, 2025 was 8 years assuming a Constant Prepayment Rate (CPR) of 3% through 2028 and 5% thereafter. Prior to third-quarter 2025, the CPR assumption was 5%.

13

 

Floor Income

The following table analyzes, on a Core Earnings basis, the ability of the FFELP Loans in our portfolio to earn Floor Income after September 30, 2025 and 2024, based on interest rates as of those dates.

 

 

 

 

 

 

 

(Dollars in billions)

 

September 30, 2025

 

 

September 30, 2024

 

Education loans eligible to earn Floor Income

 

$

28.8

 

 

$

31.3

 

Less: post-March 31, 2006 disbursed loans required to rebate
   Floor Income

 

 

(13.9

)

 

 

(15.0

)

Less: economically hedged Floor Income

 

 

(.7

)

 

 

(1.8

)

Education loans eligible to earn Floor Income after rebates and
   economically hedged

 

$

14.2

 

 

$

14.5

 

Education loans earning Floor Income

 

$

2.3

 

 

$

1.4

 

The following table presents a projection of the average balance of FFELP Consolidation Loans for which Fixed Rate Floor Income has been economically hedged with derivatives for the period October 1, 2025 to December 31, 2028.

(Dollars in billions)

 

October 1, 2025
to
December 31, 2025

 

 

2026

 

 

2027

 

 

2028

 

Average balance of FFELP Consolidation Loans
   whose Floor Income is economically hedged

 

$

.7

 

 

$

.6

 

 

$

.3

 

 

$

.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for Loan Losses

Provision for loan losses increased $18 million. The $13 million of provision for loan losses in the current quarter was primarily the result of elevated delinquency balances, our forecasted macroeconomic outlook as well as the continued extension of the portfolio. The $(5) million of provision for loan losses in the year-ago quarter was the result of relatively stable credit trends.

Operating Expenses

Operating expenses for the Federal Education Loans segment primarily include costs incurred to perform servicing on our FFELP Loan portfolio and federal education loans held by other institutions. Expenses were $4 million lower primarily as a result of the outsourcing of the loan servicing of our portfolio to a third party on July 1, 2024. This created a variable cost structure resulting in the significant reduction in expenses (20%) as the portfolio paid down.

 

 


 

 

 

14

 

Consumer Lending Segment

The following table presents Core Earnings results for our Consumer Lending segment.

 

 

Three Months Ended September 30,

 

 

% Increase
(Decrease)

 

 

Nine Months Ended September 30,

 

 

% Increase
(Decrease)

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025 vs. 2024

 

 

2025

 

 

2024

 

 

2025 vs. 2024

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Private Education Loans

 

$

276

 

 

$

314

 

 

 

(12

)%

 

$

838

 

 

$

958

 

 

 

(13

)%

Cash and investments

 

 

5

 

 

 

6

 

 

 

(17

)

 

 

15

 

 

 

20

 

 

 

(25

)

Interest income

 

 

281

 

 

 

320

 

 

 

(12

)

 

 

853

 

 

 

978

 

 

 

(13

)

Interest expense

 

 

183

 

 

 

198

 

 

 

(8

)

 

 

547

 

 

 

597

 

 

 

(8

)

Net interest income

 

 

98

 

 

 

122

 

 

 

(20

)

 

 

306

 

 

 

381

 

 

 

(20

)

Less: provision for loan
   losses

 

 

155

 

 

 

47

 

 

 

230

 

 

 

207

 

 

 

74

 

 

 

180

 

Net interest income (loss)
   after provision for loan
   losses

 

 

(57

)

 

 

75

 

 

 

(176

)

 

 

99

 

 

 

307

 

 

 

(68

)

Total other income

 

 

3

 

 

 

2

 

 

 

50

 

 

 

9

 

 

 

10

 

 

 

(10

)

Direct operating expenses

 

 

45

 

 

 

44

 

 

 

2

 

 

 

115

 

 

 

110

 

 

 

5

 

Income (loss) before income
   tax expense (benefit)

 

 

(99

)

 

 

33

 

 

 

(400

)

 

 

(7

)

 

 

207

 

 

 

(103

)

Income tax expense (benefit)

 

 

(23

)

 

 

6

 

 

 

(483

)

 

 

(3

)

 

 

47

 

 

 

(106

)

Net income (loss)

 

$

(76

)

 

$

27

 

 

 

(381

)%

 

$

(4

)

 

$

160

 

 

 

(103

)%

Comparison of Third-Quarter 2025 Results with Third-Quarter 2024

•
Originated $788 million of Private Education Loans, a 58% increase compared to $500 million.
o
Refinance Loan originations were $528 million compared to $262 million.
o
In-school loan originations were $260 million compared to $238 million.
•
Net loss was $76 million compared to net income of $27 million.
•
Net interest income decreased $24 million, primarily due to the paydown of the loan portfolio as well as a decrease in loan discount amortization due to a decrease in prepayment rate assumptions ($7 million reduction in the current period).
•
Provision for loan losses increased $108 million. The provision for loan losses of $155 million in the current period included $17 million associated with loan originations and $138 million primarily the result of elevated delinquency balances as well as our forecasted macroeconomic outlook. The provision for loan losses of $47 million in the year-ago period included $21 million related to lowering the expected recovery rate on defaulted loans, $15 million associated with loan originations and $11 million related to a general reserve build.
o
Excluding $1 million and $21 million, respectively, related to the change in the net charge-off rate on defaulted loans, net charge-offs were $95 million, up $21 million from $74 million.
o
Private Education Loan delinquencies greater than 90 days: $433 million, up $56 million from $377 million.
o
Private Education Loan forbearances: $239 million, down $206 million from $445 million.
•
Expenses increased $1 million primarily as a result of higher marketing spend associated with higher loan origination volume.

 

15

 

Key performance metrics are as follows:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Segment net interest margin

 

 

2.39

%

 

 

2.84

%

 

 

2.48

%

 

 

2.91

%

Private Education Loans (including Refinance Loans):

 

 

 

 

 

 

 

 

 

 

 

 

   Private Education Loan spread

 

 

2.48

%

 

 

2.94

%

 

 

2.58

%

 

 

3.02

%

   Provision for loan losses

 

$

155

 

 

$

47

 

 

$

207

 

 

$

74

 

   Net charge-offs(1)

 

$

95

 

 

$

74

 

 

$

246

 

 

$

240

 

   Net charge-off rate(1)

 

 

2.48

%

 

 

1.87

%

 

 

2.14

%

 

 

1.98

%

   Greater than 30-days delinquency rate

 

 

6.1

%

 

 

5.3

%

 

 

6.1

%

 

 

5.3

%

   Greater than 90-days delinquency rate

 

 

2.8

%

 

 

2.4

%

 

 

2.8

%

 

 

2.4

%

   Forbearance rate

 

 

1.5

%

 

 

2.8

%

 

 

1.5

%

 

 

2.8

%

   Average Private Education Loans

 

$

15,894

 

 

$

16,587

 

 

$

16,014

 

 

$

16,968

 

   Ending Private Education Loans, net

 

$

15,456

 

 

$

16,005

 

 

$

15,456

 

 

$

16,005

 

Private Education Refinance Loans:

 

 

 

 

 

 

 

 

 

 

 

 

   Net charge-offs

 

$

19

 

 

$

13

 

 

$

53

 

 

$

36

 

   Greater than 90-days delinquency rate

 

 

.8

%

 

 

.6

%

 

 

.8

%

 

 

.6

%

   Average balance of Private Education Refinance Loans

 

$

8,649

 

 

$

8,552

 

 

$

8,549

 

 

$

8,669

 

   Ending balance of Private Education Refinance Loans

 

$

8,571

 

 

$

8,405

 

 

$

8,571

 

 

$

8,405

 

   Private Education Refinance Loan originations

 

$

528

 

 

$

262

 

 

$

1,442

 

 

$

712

 

 

(1)
Excludes $1 million and $21 million of charge-offs on the expected future recoveries of previously fully charged-off loans in third-quarters 2025 and 2024, respectively, as a result of increasing the net charge-off rate on defaulted loans.

Net Interest Margin

The following table details the net interest margin.

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Private Education Loan yield

 

 

6.90

%

 

 

7.52

%

 

 

7.00

%

 

 

7.54

%

Private Education Loan cost of funds

 

 

(4.42

)

 

 

(4.58

)

 

 

(4.42

)

 

 

(4.52

)

Private Education Loan spread

 

 

2.48

 

 

 

2.94

 

 

 

2.58

 

 

 

3.02

 

Other interest-earning asset spread impact

 

 

(.09

)

 

 

(.10

)

 

 

(.10

)

 

 

(.11

)

Net interest margin(1)

 

 

2.39

%

 

 

2.84

%

 

 

2.48

%

 

 

2.91

%

 

 

 

(1)
The average balances of the interest-earning assets for the respective periods are:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Private Education Loans

 

$

15,894

 

 

$

16,587

 

 

$

16,014

 

 

$

16,968

 

Other interest-earning assets

 

 

487

 

 

 

485

 

 

 

486

 

 

 

533

 

Total Private Education Loan interest-earning assets

 

$

16,381

 

 

$

17,072

 

 

$

16,500

 

 

$

17,501

 

 

 

The 45 basis point decrease in the net interest margin in third-quarter 2025 is primarily the result of an $18 million decrease (44 basis points) in loan discount amortization mostly related to a decrease in prepayment rate assumptions used to amortize loan discount. In addition, the continued shift of the Refinance Loan portfolio becoming a higher percentage of the overall Private Education Loan portfolio and the Refinance Loan portfolio earning a lower net interest margin compared to the legacy portfolio reduces the overall net interest margin.

As of September 30, 2025, our Private Education Loan portfolio totaled $15.5 billion, comprised of $8.6 billion of refinance loans and $6.9 billion of non-refinance loans. The weighted-average life of these portfolios as of September 30, 2025 was 5 years and 4 years, respectively, assuming a CPR of 10% and 8%, respectively. Prior to third-quarter 2025, the CPR assumption was 10% for both refinance and non-refinance loans.

16

 

Provision for Loan Losses

The provision for Private Education Loan losses increased $108 million. The provision for loan losses of $155 million in third quarter 2025 included $17 million associated with loan originations and $138 million primarily the result of elevated delinquency balances as well as our forecasted macroeconomic outlook. The provision for loan losses of $47 million in the year-ago period included $21 million related to lowering the expected recovery rate on defaulted loans, $15 million associated with loan originations and $11 million related to a general reserve build.

Operating Expenses

Operating expenses for our consumer lending segment include costs to originate, acquire, service and collect on our consumer loan portfolio. Operating expenses increased $1 million primarily as a result of higher marketing spend associated with higher loan origination volume.

Business Processing Segment

The following table presents Core Earnings results for our Business Processing segment.

 

 

Three Months Ended September 30,

 

 

% Increase
(Decrease)

 

 

Nine Months Ended September 30,

 

 

% Increase
(Decrease)

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025 vs. 2024

 

 

2025

 

 

2024

 

 

2025 vs. 2024

 

Business processing revenue

 

$

—

 

 

$

70

 

 

 

(100

)%

 

$

23

 

 

$

228

 

 

 

(90

)%

Gain on sale of subsidiary

 

 

—

 

 

 

219

 

 

 

(100

)

 

 

—

 

 

 

219

 

 

 

(100

)%

Total other income

 

 

—

 

 

 

289

 

 

 

(100

)%

 

 

23

 

 

 

447

 

 

 

(95

)%

Direct operating expenses

 

 

—

 

 

 

57

 

 

 

(100

)

 

 

20

 

 

 

188

 

 

 

(89

)

Income before income tax
   expense

 

 

—

 

 

 

232

 

 

 

(100

)

 

 

3

 

 

 

259

 

 

 

(99

)

Income tax expense

 

 

—

 

 

 

54

 

 

 

(100

)

 

 

1

 

 

 

60

 

 

 

(98

)

Net income

 

$

—

 

 

$

178

 

 

 

(100

)%

 

$

2

 

 

$

199

 

 

 

(99

)%

Comparison of Third-Quarter 2025 Results with Third-Quarter 2024

•
With the sale of our government services business in February 2025, Navient no longer provides business processing segment services. Navient provided certain transition services (reflected in the Other segment) in connection with the sale of our business processing businesses. The transition services related to the sale of our healthcare services business ended in May 2025 and as of October 2025 we have no further obligations to provide transition services for our government services business.

Key performance metrics are as follows:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Revenue from government services

 

$

—

 

 

$

42

 

 

$

23

 

 

$

140

 

Revenue from healthcare services

 

 

—

 

 

 

28

 

 

 

—

 

 

 

88

 

Total fee revenue

 

$

—

 

 

$

70

 

 

$

23

 

 

$

228

 

Gain on sale of subsidiary

 

 

—

 

 

 

219

 

 

 

—

 

 

 

219

 

Total revenue

 

$

—

 

 

$

289

 

 

$

23

 

 

$

447

 

EBITDA(1)

 

$

—

 

 

$

233

 

 

$

3

 

 

$

262

 

EBITDA margin(1)

 

 

—

%

 

 

81

%

 

 

13

%

 

 

59

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)
Item is a non-GAAP financial measure. For a description and reconciliation, see “Non-GAAP Financial Measures.”

17

 

Other Segment

The following table presents Core Earnings results for our Other segment.

 

 

Three Months Ended September 30,

 

 

% Increase
(Decrease)

 

 

Nine Months Ended September 30,

 

 

% Increase
(Decrease)

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025 vs. 2024

 

 

2025

 

 

2024

 

 

2025 vs. 2024

 

Net interest loss after provision for
   loan losses

 

$

(17

)

 

$

(22

)

 

 

(23

)%

 

$

(53

)

 

$

(68

)

 

 

(22

)%

Other revenue

 

 

10

 

 

 

10

 

 

 

—

 

 

 

44

 

 

 

16

 

 

 

175

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unallocated shared services
   operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Unallocated information
      technology costs

 

 

19

 

 

 

21

 

 

 

(10

)

 

 

60

 

 

 

63

 

 

 

(5

)

   Unallocated corporate costs

 

 

25

 

 

 

42

 

 

 

(40

)

 

 

84

 

 

 

119

 

 

 

(29

)

Total unallocated shared
   services operating
   expenses

 

 

44

 

 

 

63

 

 

 

(30

)

 

 

144

 

 

 

182

 

 

 

(21

)

Restructuring/other
   reorganization expenses

 

 

4

 

 

 

18

 

 

 

(78

)

 

 

6

 

 

 

35

 

 

 

(83

)

Total expenses

 

 

48

 

 

 

81

 

 

 

(41

)

 

 

150

 

 

 

217

 

 

 

(31

)

Loss before income tax benefit

 

 

(55

)

 

 

(93

)

 

 

(41

)

 

 

(159

)

 

 

(269

)

 

 

(41

)

Income tax benefit

 

 

(13

)

 

 

(21

)

 

 

(38

)

 

 

(36

)

 

 

(61

)

 

 

(41

)

Net loss

 

$

(42

)

 

$

(72

)

 

 

(42

)%

 

$

(123

)

 

$

(208

)

 

 

(41

)%

 

Net Interest Loss after Provision for Loan Losses

Net interest loss after provision for loan losses is due to the negative carrying cost of our corporate liquidity portfolio. The amount of the net interest loss is primarily a result of the size of the liquidity portfolio as well as the cost of funds of the debt funding the corporate liquidity portfolio.

Other Revenue

All revenue and expense in connection with the transition services we performed related to the outsourcing of loan servicing and divestiture of our Business Processing segment are included in the Other segment.

Unallocated Shared Services Operating Expenses

Unallocated shared services operating expenses are costs primarily related to information technology costs related to infrastructure and operations, stock-based compensation expense, accounting, finance, legal, compliance and risk management, regulatory-related expenses, human resources, certain executive management, the Board of Directors, and transition services discussed above under "Other Revenue." Regulatory-related expenses include actual settlement amounts as well as third-party professional fees we incur in connection with such regulatory matters and are presented net of any insurance reimbursements for covered costs related to such matters. Expenses decreased $19 million from third-quarter 2024, primarily as a result of a $13 million decrease in regulatory-related expenses. Regulatory-related expenses were $1 million and $14 million in third quarters 2025 and 2024, respectively, with third-quarter 2024 including a contingency loss accrual of $18 million related to the $120 million settlement agreement entered into with the CFPB in September 2024. The remaining $6 million decrease in expenses primarily related to cost reduction efforts in connection with the various strategic initiatives that have been and continue to be implemented to simplify the Company, reduce our expense base and enhance our flexibility.

See “Note 10 – Commitments, Contingencies and Guarantees” for a discussion of legal and regulatory matters where it is reasonably possible that a loss contingency exists. The Company is unable to anticipate the timing of a resolution or the impact that certain matters may have on the Company’s consolidated financial position, liquidity, results of operation or cash flows. As a result, it is not possible at this time to estimate a range of potential exposure, if any, for amounts that may be payable in connection with certain matters and reserves have not been established. It is possible that an adverse ruling or rulings may have a material adverse impact on the Company.

Restructuring/Other Reorganization Expenses

These expenses decreased $14 million primarily due to a decrease in severance-related costs incurred in connection with the various strategic initiatives that have been and continue to be implemented to simplify the Company, reduce our expense base and enhance our flexibility.

18

 

Financial Condition

This section provides information regarding the balances, activity and credit performance metrics of our education loan portfolio.

Summary of Our Education Loan Portfolio

Ending Education Loan Balances, net

 

 

September 30, 2025

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Total education loan portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In-school(1)

 

$

8

 

 

$

—

 

 

$

8

 

 

$

105

 

 

$

113

 

Grace, repayment and other(2)

 

 

10,731

 

 

 

18,399

 

 

 

29,130

 

 

 

15,757

 

 

 

44,887

 

Total

 

 

10,739

 

 

 

18,399

 

 

 

29,138

 

 

 

15,862

 

 

 

45,000

 

Allowance for loan losses

 

 

(150

)

 

 

(36

)

 

 

(186

)

 

 

(406

)

 

 

(592

)

Total education loan portfolio

 

$

10,589

 

 

$

18,363

 

 

$

28,952

 

 

$

15,456

 

 

$

44,408

 

% of total FFELP

 

 

37

%

 

 

63

%

 

 

100

%

 

 

 

 

 

 

% of total

 

 

24

%

 

 

41

%

 

 

65

%

 

 

35

%

 

 

100

%

 

 

December 31, 2024

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Total education loan portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In-school(1)

 

$

9

 

 

$

—

 

 

$

9

 

 

$

95

 

 

$

104

 

Grace, repayment and other(2)

 

 

11,233

 

 

 

19,790

 

 

 

31,023

 

 

 

16,062

 

 

 

47,085

 

Total

 

 

11,242

 

 

 

19,790

 

 

 

31,032

 

 

 

16,157

 

 

 

47,189

 

Allowance for loan losses

 

 

(139

)

 

 

(41

)

 

 

(180

)

 

 

(441

)

 

 

(621

)

Total education loan portfolio

 

$

11,103

 

 

$

19,749

 

 

$

30,852

 

 

$

15,716

 

 

$

46,568

 

% of total FFELP

 

 

36

%

 

 

64

%

 

 

100

%

 

 

 

 

 

 

% of total

 

 

24

%

 

 

42

%

 

 

66

%

 

 

34

%

 

 

100

%

 

 

 

September 30, 2024

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Total education loan portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In-school(1)

 

$

10

 

 

$

—

 

 

$

10

 

 

$

92

 

 

$

102

 

Grace, repayment and other(2)

 

 

11,462

 

 

 

20,230

 

 

 

31,692

 

 

 

16,384

 

 

 

48,076

 

Total

 

 

11,472

 

 

 

20,230

 

 

 

31,702

 

 

 

16,476

 

 

 

48,178

 

Allowance for loan losses

 

 

(136

)

 

 

(44

)

 

 

(180

)

 

 

(471

)

 

 

(651

)

Total education loan portfolio

 

$

11,336

 

 

$

20,186

 

 

$

31,522

 

 

$

16,005

 

 

$

47,527

 

% of total FFELP

 

 

36

%

 

 

64

%

 

 

100

%

 

 

 

 

 

 

% of total

 

 

24

%

 

 

42

%

 

 

66

%

 

 

34

%

 

 

100

%

 

(1)
Loans for customers still attending school and are not yet required to make payments on the loan.
(2)
Includes loans in deferment or forbearance.

 

19

 

Education Loan Activity

 

 

 

Three Months Ended September 30, 2025

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Beginning balance

 

$

10,797

 

 

$

18,821

 

 

$

29,618

 

 

$

15,530

 

 

$

45,148

 

Acquisitions (originations and purchases)(1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

687

 

 

 

687

 

Capitalized interest and premium/discount
   amortization

 

 

126

 

 

 

122

 

 

 

248

 

 

 

33

 

 

 

281

 

Refinancings and consolidations to third
   parties

 

 

(119

)

 

 

(148

)

 

 

(267

)

 

 

(63

)

 

 

(330

)

Repayments and other

 

 

(215

)

 

 

(432

)

 

 

(647

)

 

 

(731

)

 

 

(1,378

)

Ending balance

 

$

10,589

 

 

$

18,363

 

 

$

28,952

 

 

$

15,456

 

 

$

44,408

 

 

 

Three Months Ended September 30, 2024

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Beginning balance

 

$

11,796

 

 

$

21,144

 

 

$

32,940

 

 

$

16,238

 

 

$

49,178

 

Acquisitions (originations and purchases)(1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

407

 

 

 

407

 

Capitalized interest and premium/discount
   amortization

 

 

129

 

 

 

121

 

 

 

250

 

 

 

46

 

 

 

296

 

Refinancings and consolidations to third
   parties

 

 

(274

)

 

 

(600

)

 

 

(874

)

 

 

(52

)

 

 

(926

)

Repayments and other

 

 

(315

)

 

 

(479

)

 

 

(794

)

 

 

(634

)

 

 

(1,428

)

Ending balance

 

$

11,336

 

 

$

20,186

 

 

$

31,522

 

 

$

16,005

 

 

$

47,527

 

 

 

Nine Months Ended September 30, 2025

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Beginning balance

 

$

11,103

 

 

$

19,749

 

 

$

30,852

 

 

$

15,716

 

 

$

46,568

 

Acquisitions (originations and purchases)(1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,790

 

 

 

1,790

 

Capitalized interest and premium/discount
   amortization

 

 

393

 

 

 

374

 

 

 

767

 

 

 

125

 

 

 

892

 

Refinancings and consolidations to third
   parties

 

 

(305

)

 

 

(386

)

 

 

(691

)

 

 

(172

)

 

 

(863

)

Repayments and other

 

 

(602

)

 

 

(1,374

)

 

 

(1,976

)

 

 

(2,003

)

 

 

(3,979

)

Ending balance

 

$

10,589

 

 

$

18,363

 

 

$

28,952

 

 

$

15,456

 

 

$

44,408

 

 

 

 

Nine Months Ended September 30, 2024

 

(Dollars in millions)

 

FFELP
Stafford and
Other

 

 

FFELP
Consolidation
Loans

 

 

Total
FFELP
Loans

 

 

Private
Education
Loans

 

 

Total
Portfolio

 

Beginning balance

 

$

13,564

 

 

$

24,361

 

 

$

37,925

 

 

$

16,902

 

 

$

54,827

 

Acquisitions (originations and purchases)(1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1,017

 

 

 

1,017

 

Capitalized interest and premium/discount
   amortization

 

 

384

 

 

 

388

 

 

 

772

 

 

 

152

 

 

 

924

 

Refinancings and consolidations to third
   parties

 

 

(1,505

)

 

 

(3,024

)

 

 

(4,529

)

 

 

(151

)

 

 

(4,680

)

Repayments and other

 

 

(1,107

)

 

 

(1,539

)

 

 

(2,646

)

 

 

(1,915

)

 

 

(4,561

)

Ending balance

 

$

11,336

 

 

$

20,186

 

 

$

31,522

 

 

$

16,005

 

 

$

47,527

 

 

 

(1)
Includes the origination of $54 million and $47 million of Private Education Refinance Loans in the third-quarters of 2025 and 2024, respectively, and $200 million and $138 million in the nine months ended September 30, 2025 and 2024, respectively, that refinanced FFELP and Private Education Loans that were on our balance sheet

 

20

 

FFELP Loan Portfolio Performance

 

 

 

September 30, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

(Dollars in millions)

 

Balance

 

 

%

 

 

Balance

 

 

%

 

 

Balance

 

 

%

 

Loans in-school/grace/deferment(1)

 

$

1,276

 

 

 

 

 

$

1,262

 

 

 

 

 

$

1,342

 

 

 

 

Loans in forbearance(2)

 

 

3,726

 

 

 

 

 

 

4,365

 

 

 

 

 

 

4,978

 

 

 

 

Loans in repayment and percentage of each status:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans current

 

 

19,766

 

 

 

81.9

%

 

 

20,675

 

 

 

81.4

%

 

 

21,975

 

 

 

86.6

%

Loans delinquent 31-60 days(3)

 

 

1,062

 

 

 

4.4

 

 

 

1,479

 

 

 

5.8

 

 

 

948

 

 

 

3.7

 

Loans delinquent 61-90 days(3)

 

 

769

 

 

 

3.2

 

 

 

1,043

 

 

 

4.1

 

 

 

599

 

 

 

2.4

 

Loans delinquent greater than 90 days(3)

 

 

2,539

 

 

 

10.5

 

 

 

2,208

 

 

 

8.7

 

 

 

1,860

 

 

 

7.3

 

Total FFELP Loans in repayment

 

 

24,136

 

 

 

100

%

 

 

25,405

 

 

 

100

%

 

 

25,382

 

 

 

100

%

Total FFELP Loans

 

 

29,138

 

 

 

 

 

 

31,032

 

 

 

 

 

 

31,702

 

 

 

 

FFELP Loan allowance for losses

 

 

(186

)

 

 

 

 

 

(180

)

 

 

 

 

 

(180

)

 

 

 

FFELP Loans, net

 

$

28,952

 

 

 

 

 

$

30,852

 

 

 

 

 

$

31,522

 

 

 

 

Percentage of FFELP Loans in repayment

 

 

 

 

 

82.8

%

 

 

 

 

 

81.9

%

 

 

 

 

 

80.1

%

Delinquencies as a percentage of FFELP Loans in
   repayment

 

 

 

 

 

18.1

%

 

 

 

 

 

18.6

%

 

 

 

 

 

13.4

%

FFELP Loans in forbearance as a percentage of
   loans in repayment and forbearance

 

 

 

 

 

13.4

%

 

 

 

 

 

14.7

%

 

 

 

 

 

16.4

%

(1)
Loans for customers who may still be attending school or engaging in other permitted educational activities and are not yet required to make payments on their loans, e.g., residency periods for medical students or a grace period for bar exam preparation, as well as loans for customers who have requested and qualify for other permitted program deferments such as military, unemployment, or economic hardships.
(2)
Loans for customers 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 such as disaster relief.
(3)
The period of delinquency is based on the number of days scheduled payments are contractually past due.

Private Education Loan Portfolio Performance

 

 

 

September 30, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

(Dollars in millions)

 

Balance

 

 

%

 

 

Balance

 

 

%

 

 

Balance

 

 

%

 

Loans in-school/grace/deferment(1)

 

$

402

 

 

 

 

 

$

372

 

 

 

 

 

$

372

 

 

 

 

Loans in forbearance(2)

 

 

239

 

 

 

 

 

 

422

 

 

 

 

 

 

445

 

 

 

 

Loans in repayment and percentage of each status:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans current

 

 

14,291

 

 

 

93.9

%

 

 

14,419

 

 

 

93.9

%

 

 

14,827

 

 

 

94.7

%

Loans delinquent 31-60 days(3)

 

 

315

 

 

 

2.1

 

 

 

319

 

 

 

2.1

 

 

 

282

 

 

 

1.8

 

Loans delinquent 61-90 days(3)

 

 

182

 

 

 

1.2

 

 

 

206

 

 

 

1.3

 

 

 

173

 

 

 

1.1

 

Loans delinquent greater than 90 days(3)

 

 

433

 

 

 

2.8

 

 

 

419

 

 

 

2.7

 

 

 

377

 

 

 

2.4

 

Total Private Education Loans in repayment

 

 

15,221

 

 

 

100

%

 

 

15,363

 

 

 

100

%

 

 

15,659

 

 

 

100

%

Total Private Education Loans

 

 

15,862

 

 

 

 

 

 

16,157

 

 

 

 

 

 

16,476

 

 

 

 

Private Education Loan allowance for losses

 

 

(406

)

 

 

 

 

 

(441

)

 

 

 

 

 

(471

)

 

 

 

Private Education Loans, net

 

$

15,456

 

 

 

 

 

$

15,716

 

 

 

 

 

$

16,005

 

 

 

 

Percentage of Private Education Loans in
   repayment

 

 

 

 

 

96.0

%

 

 

 

 

 

95.1

%

 

 

 

 

 

95.0

%

Delinquencies as a percentage of Private Education
   Loans in repayment

 

 

 

 

 

6.1

%

 

 

 

 

 

6.1

%

 

 

 

 

 

5.3

%

Loans in forbearance as a percentage of loans in
   repayment and forbearance

 

 

 

 

 

1.5

%

 

 

 

 

 

2.7

%

 

 

 

 

 

2.8

%

Percentage of Private Education Loans with a
   cosigner(4)

 

 

 

 

 

32

%

 

 

 

 

 

32

%

 

 

 

 

 

33

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)
Loans for customers who are attending school or are in other permitted educational activities and are not yet required to make payments on their loans, e.g., loans for customers who have requested and qualify for other permitted program deferments such as various military eligible deferments.
(2)
Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors such as disaster relief 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)
Excluding Private Education Refinance Loans, which do not have a cosigner, the cosigner rate was 67%, 66% and 66% for third-quarter 2025, fourth-quarter 2024 and third-quarter 2024, respectively.

 

 

21

 

Allowance for Loan Losses

 

 

 

Three Months Ended September 30,

 

 

 

2025

 

 

2024

 

(Dollars in millions)

 

FFELP Loans

 

 

Private Education Loans

 

 

Total

 

 

FFELP Loans

 

 

Private Education Loans

 

 

Total

 

Allowance at beginning of period

 

$

182

 

 

$

348

 

 

$

530

 

 

$

194

 

 

$

493

 

 

$

687

 

Total provision

 

 

13

 

 

 

155

 

 

 

168

 

 

 

(5

)

 

 

47

 

 

 

42

 

Charge-offs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Gross charge-offs

 

 

(9

)

 

 

(111

)

 

 

(120

)

 

 

(9

)

 

 

(85

)

 

 

(94

)

  Expected future recoveries on current period gross
     charge-offs

 

 

—

 

 

 

16

 

 

 

16

 

 

 

—

 

 

 

11

 

 

 

11

 

  Total(1)

 

 

(9

)

 

 

(95

)

 

 

(104

)

 

 

(9

)

 

 

(74

)

 

 

(83

)

  Adjustment resulting from the change in charge-off
     rate(2)

 

 

—

 

 

 

(1

)

 

 

(1

)

 

 

—

 

 

 

(21

)

 

 

(21

)

Net charge-offs

 

 

(9

)

 

 

(96

)

 

 

(105

)

 

 

(9

)

 

 

(95

)

 

 

(104

)

Decrease in expected future recoveries on previously
   fully charged-off loans(3)

 

 

—

 

 

 

(1

)

 

 

(1

)

 

 

—

 

 

 

26

 

 

 

26

 

Allowance at end of period (GAAP)

 

 

186

 

 

 

406

 

 

 

592

 

 

 

180

 

 

 

471

 

 

 

651

 

Plus: expected future recoveries on previously fully
   charged-off loans(3)

 

 

—

 

 

 

173

 

 

 

173

 

 

 

—

 

 

 

185

 

 

 

185

 

Allowance at end of period excluding expected future
   recoveries on previously fully charged-off loans
   (Non-GAAP Financial Measure)(4)

 

$

186

 

 

$

579

 

 

$

765

 

 

$

180

 

 

$

656

 

 

$

836

 

Net charge-offs as a percentage of average loans in
   repayment, excluding the net adjustment resulting
   from the change in charge-off rate (annualized)(2)

 

 

.15

%

 

 

2.48

%

 

 

 

 

 

.14

%

 

 

1.87

%

 

 

 

Net adjustment resulting from the change in charge
   -off rate as a percentage of average loans in
   repayment (annualized)(2)

 

 

—

%

 

 

.02

%

 

 

 

 

 

—

%

 

 

.53

%

 

 

 

Net charge-offs as a percentage of average loans
   in repayment (annualized)

 

 

.15

%

 

 

2.50

%

 

 

 

 

 

.14

%

 

 

2.40

%

 

 

 

Allowance coverage of charge-offs (annualized)(4)

 

 

5.1

 

 

 

1.5

 

 

 (Non-GAAP)

 

 

 

5.0

 

 

 

1.7

 

 

 (Non-GAAP)

 

Allowance as a percentage of the ending total loan
   balance(4)

 

 

.6

%

 

 

3.7

%

 

 (Non-GAAP)

 

 

 

.6

%

 

 

4.0

%

 

 (Non-GAAP)

 

Allowance as a percentage of the ending loans in
   repayment(4)

 

 

.8

%

 

 

3.8

%

 

 (Non-GAAP)

 

 

 

.7

%

 

 

4.2

%

 

 (Non-GAAP)

 

Ending total loans

 

$

29,138

 

 

$

15,862

 

 

 

 

 

$

31,702

 

 

$

16,476

 

 

 

 

Average loans in repayment

 

$

24,527

 

 

$

15,259

 

 

 

 

 

$

25,866

 

 

$

15,856

 

 

 

 

Ending loans in repayment

 

$

24,136

 

 

$

15,221

 

 

 

 

 

$

25,382

 

 

$

15,659

 

 

 

 

 

(1)
Charge-offs are reported net of expected recoveries. For Private Education Loans, we charge off the estimated loss of a defaulted loan balance by charging off the entire defaulted loan balance and estimating recoveries on a pool basis. These estimated recoveries are referred to as "expected future recoveries on previously fully charged-off loans." For FFELP Loans, the recovery is received at the time of charge-off.
(2)
Related to increasing the net charge-off rate on defaulted Private Education Loans and the resulting reduction in the balance of expected future recoveries on previously fully charged-off loans.
(3)
At the end of each month, for Private Education Loans that are 212 days past due, we charge off the estimated loss of a defaulted loan balance by charging off the entire loan balance and estimating recoveries on a pool basis. These estimated recoveries are referred to as “expected future recoveries on previously fully charged-off loans.” If actual periodic recoveries are less than expected, the difference is immediately reflected as a reduction to expected future recoveries on previously fully charged-off loans. If actual periodic recoveries are greater than expected, they will be reflected as a recovery through the allowance for Private Education Loan losses once the cumulative recovery amount exceeds the cumulative amount originally expected to be recovered. The following table summarizes the activity in the expected future recoveries on previously fully charged-off loans

 

 

Three Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

Beginning of period expected future recoveries on
   previously fully charged-off loans

 

$

172

 

 

$

211

 

Expected future recoveries of current period defaults

 

 

16

 

 

 

11

 

Recoveries (cash collected)

 

 

(9

)

 

 

(10

)

Charge-offs (as a result of lower recovery expectations)

 

 

(6

)

 

 

(27

)

End of period expected future recoveries on previously
   fully charged-off loans

 

$

173

 

 

$

185

 

Change in balance during period

 

$

1

 

 

$

(26

)
(4)
The allowance used for these metrics excludes the expected future recoveries on previously fully charged-off loans to better reflect the current expected credit losses remaining in the portfolio.

22

 

 

 

 

 

Nine Months Ended September 30,

 

 

 

2025

 

 

2024

 

(Dollars in millions)

 

FFELP Loans

 

 

Private Education Loans

 

 

Total

 

 

FFELP Loans

 

 

Private Education Loans

 

 

Total

 

Beginning balance

 

$

180

 

 

$

441

 

 

$

621

 

 

$

215

 

 

$

617

 

 

$

832

 

Total provision

 

 

29

 

 

 

207

 

 

 

236

 

 

 

(6

)

 

 

74

 

 

 

68

 

Charge-offs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross charge-offs

 

 

(23

)

 

 

(285

)

 

 

(308

)

 

 

(29

)

 

 

(272

)

 

 

(301

)

Expected future recoveries on current period gross
   charge-offs

 

 

—

 

 

 

39

 

 

 

39

 

 

 

—

 

 

 

32

 

 

 

32

 

Total(1)

 

 

(23

)

 

 

(246

)

 

 

(269

)

 

 

(29

)

 

 

(240

)

 

 

(269

)

Adjustment resulting from the change in charge-off
   rate(2)

 

 

—

 

 

 

(2

)

 

 

(2

)

 

 

—

 

 

 

(21

)

 

 

(21

)

Net charge-offs

 

 

(23

)

 

 

(248

)

 

 

(271

)

 

 

(29

)

 

 

(261

)

 

 

(290

)

Decrease in expected future recoveries on previously
   fully charged-off loans(3)

 

 

—

 

 

 

6

 

 

 

6

 

 

 

—

 

 

 

41

 

 

 

41

 

Allowance at end of period (GAAP)

 

 

186

 

 

 

406

 

 

 

592

 

 

 

180

 

 

 

471

 

 

 

651

 

Plus: expected future recoveries on previously fully
   charged-off loans(3)

 

 

—

 

 

 

173

 

 

 

173

 

 

 

—

 

 

 

185

 

 

 

185

 

Allowance at end of period excluding expected future
   recoveries on previously fully charged-off loans
   (Non-GAAP Financial Measure)(4)

 

$

186

 

 

$

579

 

 

$

765

 

 

$

180

 

 

$

656

 

 

$

836

 

Net charge-offs as a percentage of average loans in
   repayment, excluding the net adjustment resulting
   from the change in the charge-off rate
   (annualized)(2)

 

 

.13

%

 

 

2.14

%

 

 

 

 

 

.14

%

 

 

1.98

%

 

 

 

Net adjustment resulting from the change in charge
   -off rate as a percentage of average loans in
   repayment (annualized)(2)

 

 

—

%

 

 

.02

%

 

 

 

 

 

—

%

 

 

.17

%

 

 

 

Net charge-offs as a percentage of average loans in
   repayment (annualized)

 

 

.13

%

 

 

2.16

%

 

 

 

 

 

.14

%

 

 

2.15

%

 

 

 

Allowance coverage of charge-offs
   (annualized)(4)

 

 

5.8

 

 

 

1.7

 

 

 (Non-GAAP)

 

 

 

4.7

 

 

 

1.8

 

 

 (Non-GAAP)

 

Allowance as a percentage of the ending total loan
   balance(4)

 

 

.6

%

 

 

3.7

%

 

 (Non-GAAP)

 

 

 

.6

%

 

 

4.0

%

 

 (Non-GAAP)

 

Allowance as a percentage of the ending loans in
   repayment(4)

 

 

.8

%

 

 

3.8

%

 

 (Non-GAAP)

 

 

 

.7

%

 

 

4.2

%

 

 (Non-GAAP)

 

Ending total loans

 

$

29,138

 

 

$

15,862

 

 

 

 

 

$

31,702

 

 

$

16,476

 

 

 

 

Average loans in repayment

 

$

25,036

 

 

$

15,368

 

 

 

 

 

$

27,697

 

 

$

16,265

 

 

 

 

Ending loans in repayment

 

$

24,136

 

 

$

15,221

 

 

 

 

 

$

25,382

 

 

$

15,659

 

 

 

 

 

(1)
Charge-offs are reported net of expected recoveries. For Private Education Loans, we charge off the estimated loss of a defaulted loan balance by charging off the entire defaulted loan balance and estimating recoveries on a pool basis. These estimated recoveries are referred to as "expected future recoveries on previously fully charged-off loans." For FFELP Loans, the recovery is received at the time of charge-off.
(2)
Related to increasing the net charge-off rate on defaulted Private Education Loans and the resulting reduction in the balance of expected future recoveries on previously fully charged-off loans.
(3)
At the end of each month, for Private Education Loans that are 212 days past due, we charge off the estimated loss of a defaulted loan balance by charging off the entire loan balance and estimating recoveries on a pool basis. These estimated recoveries are referred to as “expected future recoveries on previously fully charged-off loans.” If actual periodic recoveries are less than expected, the difference is immediately reflected as a reduction to expected future recoveries on previously fully charged-off loans. If actual periodic recoveries are greater than expected, they will be reflected as a recovery through the allowance for Private Education Loan losses once the cumulative recovery amount exceeds the cumulative amount originally expected to be recovered. The following table summarizes the activity in the expected future recoveries on previously fully charged-off loans

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

Beginning of period expected future recoveries on
   previously fully charged-off loans

 

$

179

 

 

$

226

 

Expected future recoveries of current period defaults

 

 

39

 

 

 

32

 

Recoveries (cash collected)

 

 

(30

)

 

 

(31

)

Charge-offs (as a result of lower recovery expectations)

 

 

(15

)

 

 

(42

)

End of period expected future recoveries on previously
   fully charged-off loans

 

$

173

 

 

$

185

 

Change in balance during period

 

$

(6

)

 

$

(41

)
(4)
The allowance used for these metrics excludes the expected future recoveries on previously fully charged-off loans to better reflect the current expected credit losses remaining in the portfolio.

 

 

23

 

 

 

Liquidity and Capital Resources

Funding and Liquidity Risk Management

The following “Liquidity and Capital Resources” discussion concentrates primarily on our Federal Education Loans and Consumer Lending segments. Our Business Processing segment required minimal liquidity and funding.

We define liquidity as cash and high-quality liquid assets that we can use to meet our cash requirements. Our two primary liquidity needs are: (1) servicing our debt and (2) our ongoing ability to meet our cash needs for running the operations of our businesses (including derivative collateral requirements) throughout market cycles, including during periods of financial stress. Secondary liquidity needs, which can be adjusted as needed, include the origination of Private Education Loans, acquisitions of Private Education Loan portfolios, acquisitions of companies, the payment of common stock dividends and the repurchase of our common stock. To achieve these objectives, we analyze and monitor our liquidity needs and maintain excess liquidity and access to diverse funding sources including the issuance of unsecured debt and the issuance of secured debt primarily through asset-backed securitizations and/or other financing facilities.

We define our liquidity risk as the potential inability to meet our obligations when they become due without incurring unacceptable losses or inability to invest in future asset growth and business operations at reasonable market rates. Our primary liquidity risk relates to our ability to service our debt, meet our other business obligations and to continue to grow our business. The ability to access the capital markets is impacted by general market and economic conditions, our credit ratings, as well as the overall availability of funding sources in the marketplace. In addition, credit ratings may be important to customers or counterparties when we compete in certain markets and when we seek to engage in certain transactions.

Credit ratings and outlooks are opinions subject to ongoing review by the rating agencies and may change, from time to time, based on our financial performance, industry and market dynamics and other factors. Other factors that influence our credit ratings include the rating agencies’ assessment of the general operating environment, our relative positions in the markets in which we compete, reputation, liquidity position, the level and volatility of earnings, corporate governance and risk management policies, capital position and capital management practices. A negative change in our credit rating could have a negative effect on our liquidity because it might raise the cost and availability of funding and potentially require additional cash collateral or restrict cash currently held as collateral on existing borrowings or derivative collateral arrangements. It is our objective to improve our credit ratings so that we can continue to efficiently access the capital markets even in difficult economic and market conditions. We have unsecured debt totaling $5.3 billion at September 30, 2025. Three credit rating agencies currently rate our long-term unsecured debt at below investment grade.

We expect to fund our ongoing liquidity needs, including the repayment of $0.5 billion of senior unsecured notes that mature in the short term (i.e., over the next 12 months) and the remaining $4.8 billion of senior unsecured notes that mature in the long term (from 2026 to 2043 with 69% maturing by 2031), through a number of sources. These sources include our cash on hand, unencumbered FFELP Loan and Private Education Refinance Loan portfolios (see “Sources of Primary Liquidity” below), the predictable operating cash flows provided by operating activities, the repayment of principal on unencumbered education loan assets, and the distribution of overcollateralization from our securitization trusts. We may also, depending on market conditions and availability, draw down on our secured FFELP Loan and Private Education Loan asset-backed commercial paper (ABCP) facilities, issue term ABS, enter into additional Private Education Loan and FFELP Loan ABS repurchase facilities, or issue additional unsecured debt.

We originate Private Education Loans (a portion of which is obtained through a forward purchase agreement). We also have purchased and may purchase, in future periods, Private Education Loan portfolios from third parties. Those originations and purchases are part of our ongoing liquidity needs. We purchased 2.0 million shares of common stock for $26 million in the third quarter of 2025 and have $26 million of unused share repurchase authority as of September 30, 2025.

 

24

 

Sources of Primary Liquidity

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

September 30, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

Ending Balances:

 

 

 

 

 

 

 

 

 

Unrestricted cash

 

$

571

 

 

$

722

 

 

$

1,143

 

Unencumbered FFELP Loans

 

 

58

 

 

 

232

 

 

 

199

 

Unencumbered Private Education
   Refinance Loans

 

 

515

 

 

 

242

 

 

 

395

 

Total

 

$

1,144

 

 

$

1,196

 

 

$

1,737

 

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

(Dollars in millions)

 

September 30, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

 

September 30, 2025

 

 

September 30, 2024

 

Average Balances:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrestricted cash

 

$

604

 

 

$

737

 

 

$

1,129

 

 

$

640

 

 

$

1,004

 

Unencumbered FFELP
   Loans

 

 

52

 

 

 

316

 

 

 

179

 

 

 

99

 

 

 

148

 

Unencumbered Private
   Education Refinance
   Loans

 

 

592

 

 

 

433

 

 

 

446

 

 

 

542

 

 

 

297

 

Total

 

$

1,248

 

 

$

1,486

 

 

$

1,754

 

 

$

1,281

 

 

$

1,449

 

Sources of Additional Liquidity

Liquidity may also be available under our secured credit facilities. Maximum borrowing capacity under the FFELP Loan and Private Education Loan ABCP facilities will vary and be subject to each agreement’s borrowing conditions, including, among others, facility size, current usage and availability of qualifying collateral from unencumbered loans. The following tables detail the additional borrowing capacity of these facilities with maturity dates ranging from November 2025 to April 2027.

 

(Dollars in millions)

 

September 30, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

Ending Balances:

 

 

 

 

 

 

 

 

 

FFELP Loan ABCP facilities

 

$

178

 

 

$

424

 

 

$

422

 

Private Education Loan ABCP facilities

 

 

1,882

 

 

 

1,490

 

 

 

1,921

 

Total

 

$

2,060

 

 

$

1,914

 

 

$

2,343

 

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

(Dollars in millions)

 

September 30, 2025

 

 

December 31, 2024

 

 

September 30, 2024

 

 

September 30, 2025

 

 

September 30, 2024

 

Average Balances:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFELP Loan ABCP facilities

 

$

184

 

 

$

423

 

 

$

419

 

 

$

250

 

 

$

412

 

Private Education Loan ABCP
   facilities

 

 

1,695

 

 

 

1,799

 

 

 

2,079

 

 

 

1,586

 

 

 

1,770

 

Total

 

$

1,879

 

 

$

2,222

 

 

$

2,498

 

 

$

1,836

 

 

$

2,182

 

At September 30, 2025, we had a total of $2.8 billion of unencumbered tangible assets inclusive of those listed in the table above as sources of primary liquidity. Total unencumbered education loans comprised $1.3 billion of our unencumbered tangible assets of which $1.3 billion and $58 million related to Private Education Loans and FFELP Loans, respectively. In addition, as of September 30, 2025, we had $4.7 billion of encumbered net assets (i.e., overcollateralization) in our various financing facilities (consolidated variable interest entities). We enter into repurchase facilities at times to borrow against the encumbered net assets of these financing vehicles. As of September 30, 2025, $0.6 billion of repurchase facility borrowings were outstanding.

25

 

The following table reconciles encumbered and unencumbered assets and their net impact on total Tangible Equity.

(Dollars in billions)

 

September 30, 2025

 

 

December 31, 2024

 

Net assets of consolidated variable interest
   entities (encumbered assets) — FFELP Loans

 

$

2.7

 

 

$

2.8

 

Net assets of consolidated variable interest entities
   (encumbered assets) — Private Education Loans

 

 

2.0

 

 

 

2.0

 

Tangible unencumbered assets(1)

 

 

2.8

 

 

 

2.9

 

Senior unsecured debt

 

 

(5.3

)

 

 

(5.4

)

Mark-to-market on unsecured hedged debt(2)

 

 

—

 

 

 

.2

 

Other liabilities, net

 

 

(.2

)

 

 

(.3

)

Total Tangible Equity (3)

 

$

2.0

 

 

$

2.2

 

(1)
Excludes goodwill and acquired intangible assets.
(2)
At September 30, 2025 and December 31, 2024, there were $(53) million and $(181) million, respectively, of net gains (losses) on derivatives hedging this debt in unencumbered assets, which partially offset these gains (losses).
(3)
Item is a non-GAAP financial measure. For a description and reconciliation, see “Non-GAAP Financial Measures.”

Borrowings

Ending Balances

 

 

September 30, 2025

 

 

December 31, 2024

 

(Dollars in millions)

 

Short
Term

 

 

Long
Term

 

 

Total

 

 

Short
Term

 

 

Long
Term

 

 

Total

 

Unsecured borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Senior unsecured debt

 

$

505

 

 

$

4,800

 

 

$

5,305

 

 

$

553

 

 

$

4,806

 

 

$

5,359

 

Total unsecured borrowings

 

 

505

 

 

 

4,800

 

 

 

5,305

 

 

 

553

 

 

 

4,806

 

 

 

5,359

 

Secured borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   FFELP Loan securitizations

 

 

113

 

 

 

25,989

 

 

 

26,102

 

 

 

41

 

 

 

28,268

 

 

 

28,309

 

   Private Education Loan securitizations

 

 

535

 

 

 

10,321

 

 

 

10,856

 

 

 

631

 

 

 

10,338

 

 

 

10,969

 

   FFELP Loan ABCP facilities

 

 

1,872

 

 

 

313

 

 

 

2,185

 

 

 

1,586

 

 

 

74

 

 

 

1,660

 

   Private Education Loan ABCP facilities

 

 

1,784

 

 

 

—

 

 

 

1,784

 

 

 

2,274

 

 

 

—

 

 

 

2,274

 

   Other

 

 

113

 

 

 

39

 

 

 

152

 

 

 

54

 

 

 

40

 

 

 

94

 

Total secured borrowings

 

 

4,417

 

 

 

36,662

 

 

 

41,079

 

 

 

4,586

 

 

 

38,720

 

 

 

43,306

 

Core Earnings basis borrowings(1)

 

 

4,922

 

 

 

41,462

 

 

 

46,384

 

 

 

5,139

 

 

 

43,526

 

 

 

48,665

 

Adjustment for GAAP accounting treatment

 

 

(2

)

 

 

(48

)

 

 

(50

)

 

 

(5

)

 

 

(342

)

 

 

(347

)

GAAP basis borrowings

 

$

4,920

 

 

$

41,414

 

 

$

46,334

 

 

$

5,134

 

 

$

43,184

 

 

$

48,318

 

Average Balances

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2025

 

 

2024

 

 

2025

 

 

2024

 

(Dollars in millions)

 

Average
Balance

 

 

Average
Rate

 

 

Average
Balance

 

 

Average
Rate

 

 

Average
Balance

 

 

Average
Rate

 

 

Average
Balance

 

 

Average
Rate

 

Unsecured borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Senior unsecured debt

 

$

5,304

 

 

 

8.38

%

 

$

5,856

 

 

 

9.19

%

 

$

5,380

 

 

 

8.46

%

 

$

5,857

 

 

 

9.23

%

Total unsecured borrowings

 

 

5,304

 

 

 

8.38

 

 

 

5,856

 

 

 

9.19

 

 

 

5,380

 

 

 

8.46

 

 

 

5,857

 

 

 

9.23

 

Secured borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFELP Loan securitizations

 

 

26,662

 

 

 

5.41

 

 

 

30,361

 

 

 

6.53

 

 

 

27,344

 

 

 

5.50

 

 

 

32,711

 

 

 

6.43

 

Private Education Loan
   securitizations

 

 

10,711

 

 

 

3.69

 

 

 

11,832

 

 

 

3.82

 

 

 

10,713

 

 

 

3.67

 

 

 

11,838

 

 

 

3.68

 

FFELP Loan ABCP facilities

 

 

1,885

 

 

 

5.71

 

 

 

1,626

 

 

 

6.88

 

 

 

1,810

 

 

 

5.78

 

 

 

1,760

 

 

 

6.94

 

Private Education Loan
   ABCP facilities

 

 

1,990

 

 

 

6.28

 

 

 

1,741

 

 

 

7.59

 

 

 

2,132

 

 

 

6.32

 

 

 

2,045

 

 

 

7.39

 

Other

 

 

132

 

 

 

3.04

 

 

 

117

 

 

 

(.29

)

 

 

110

 

 

 

1.76

 

 

 

109

 

 

 

(1.69

)

Total secured borrowings

 

 

41,380

 

 

 

5.01

 

 

 

45,677

 

 

 

5.87

 

 

 

42,109

 

 

 

5.08

 

 

 

48,463

 

 

 

5.80

 

Core Earnings basis
   borrowings(1)

 

 

46,684

 

 

 

5.39

 

 

 

51,533

 

 

 

6.24

 

 

 

47,489

 

 

 

5.46

 

 

 

54,320

 

 

 

6.17

 

Adjustment for GAAP
   accounting treatment

 

 

—

 

 

 

.04

 

 

 

—

 

 

 

.16

 

 

 

—

 

 

 

.06

 

 

 

—

 

 

 

.09

 

GAAP basis borrowings

 

$

46,684

 

 

 

5.43

%

 

$

51,533

 

 

 

6.40

%

 

$

47,489

 

 

 

5.52

%

 

$

54,320

 

 

 

6.26

%

 

(1)
Item is a non-GAAP financial measure. For a description and reconciliation, see “Non-GAAP Financial Measures.” The differences in derivative accounting give rise to the difference above.

 

 

26

 

Critical Accounting Policies and Estimates

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations addresses our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP). A discussion of our critical accounting policies, which includes the allowance for loan losses, goodwill impairment assessment, premium and discount amortization, and the impact of the SDR Plan on our accounting policies and estimates, can be found in our 2024 Form 10-K.

 

Non-GAAP Financial Measures

In addition to financial results reported on a GAAP basis, Navient also provides certain performance measures which are non-GAAP financial measures. We present the following non-GAAP financial measures: (1) Core Earnings, (2) Tangible Equity (as well as the Adjusted Tangible Equity Ratio), (3) EBITDA for the Business Processing segment, and (4) Allowance for Loan Losses Excluding Expected Future Recoveries on Previously Fully Charged-off Loans. Definitions for the non-GAAP financial measures and reconciliations are provided below, except that reconciliations of forward-looking non-GAAP financial measures are not provided because the Company is unable to provide such reconciliations without unreasonable effort due to the uncertainty and inherent difficulty of predicting the occurrence and financial impact of certain items, including, but not limited to, the impact of any mark-to-market gains/losses resulting from our use of derivative instruments to hedge our economic risks.

1. Core Earnings

We prepare financial statements and present financial results in accordance with GAAP. However, we also evaluate our business segments and present financial results on a basis that differs from GAAP. We refer to this different basis of presentation as Core Earnings. We provide this Core Earnings basis of presentation on a consolidated basis and for each business segment because this is what we review internally when making management decisions regarding our performance and how we allocate resources. We also refer to this information in our presentations with credit rating agencies, lenders and investors. Because our Core Earnings basis of presentation corresponds to our segment financial presentations, we are required by GAAP to provide certain Core Earnings disclosures in the notes to our consolidated financial statements for our business segments.

Core Earnings are not a substitute for reported results under GAAP. We use Core Earnings to manage our business segments because Core Earnings reflect adjustments to GAAP financial results for two items, discussed below, that can create significant volatility mostly due to timing factors generally beyond the control of management. Accordingly, we believe that Core Earnings provide management with a useful basis from which to better evaluate results from ongoing operations against the business plan or against results from prior periods. Consequently, we disclose this information because we believe it provides investors with additional information regarding the operational and performance indicators that are most closely assessed by management. When compared to GAAP results, the two items we remove to result in our Core Earnings presentations are:

(1)
Mark-to-market gains/losses resulting from our use of derivative instruments to hedge our economic risks that do not qualify for hedge accounting treatment or do qualify for hedge accounting treatment but result in ineffectiveness; and
(2)
The accounting for goodwill and acquired intangible assets.

While GAAP provides a uniform, comprehensive basis of accounting, for the reasons described above, our Core Earnings basis of presentation does not. Core Earnings are subject to certain general and specific limitations that investors should carefully consider. For example, there is no comprehensive, authoritative guidance for management reporting. Our Core Earnings are not defined terms within GAAP and may not be comparable to similarly titled measures reported by other companies. Accordingly, our Core Earnings presentation does not represent a comprehensive basis of accounting. Investors, therefore, may not be able to compare our performance with that of other financial services companies based upon Core Earnings. Core Earnings results are only meant to supplement GAAP results by providing additional information regarding the operational and performance indicators that are most closely used by management, our Board of Directors, credit rating agencies, lenders and investors to assess performance.

27

 

The following tables show our consolidated GAAP results, Core Earnings results (including for each reportable segment) along with the adjustments made to the income/expense items to reconcile the consolidated GAAP results to the Core Earnings results as required by GAAP and reported in “Note 11 — Segment Reporting.”

 

 

 

Three Months Ended September 30, 2025

 

 

 

 

 

 

Adjustments

 

 

 

 

 

Reportable Segments

 

(Dollars in millions)

 

Total
GAAP

 

 

Reclassi-
fications

 

 

Additions/
(Subtractions)

 

 

Total
Adjustments (1)

 

 

Total
Core
Earnings

 

 

Federal Education Loans

 

 

Consumer Lending

 

 

Business Processing

 

 

Other

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education loans

 

$

760

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

484

 

 

$

276

 

 

$

—

 

 

$

—

 

Cash and investments

 

 

21

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10

 

 

 

5

 

 

 

—

 

 

 

6

 

Total interest income

 

 

781

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

494

 

 

 

281

 

 

 

—

 

 

 

6

 

Total interest expense

 

 

639

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

429

 

 

 

183

 

 

 

—

 

 

 

23

 

Net interest income
   (loss)

 

 

142

 

 

$

4

 

 

$

—

 

 

$

4

 

 

$

146

 

 

 

65

 

 

 

98

 

 

 

—

 

 

 

(17

)

Less: provisions for loan
   losses

 

 

168

 

 

 

 

 

 

 

 

 

 

 

 

168

 

 

 

13

 

 

 

155

 

 

 

—

 

 

 

—

 

Net interest income
   (loss) after provisions
   for loan losses

 

 

(26

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

52

 

 

 

(57

)

 

 

—

 

 

 

(17

)

Other income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Servicing revenue

 

 

13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10

 

 

 

3

 

 

 

—

 

 

 

—

 

Asset recovery and
   business processing
   revenue

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Other revenue (loss)

 

 

6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

10

 

Total other income

 

 

19

 

 

 

(4

)

 

 

8

 

 

 

4

 

 

 

23

 

 

 

10

 

 

 

3

 

 

 

—

 

 

 

10

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct operating
   expenses

 

 

61

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16

 

 

 

45

 

 

 

—

 

 

 

—

 

Unallocated shared
   services expenses

 

 

44

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

44

 

Operating expenses

 

 

105

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

105

 

 

 

16

 

 

 

45

 

 

 

—

 

 

 

44

 

Goodwill and acquired
   intangible asset
   impairment and
   amortization

 

 

1

 

 

 

—

 

 

 

(1

)

 

 

(1

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Restructuring/other
   reorganization
   expenses

 

 

4

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

4

 

Total expenses

 

 

110

 

 

 

—

 

 

 

(1

)

 

 

(1

)

 

 

109

 

 

 

16

 

 

 

45

 

 

 

—

 

 

 

48

 

Income (loss) before
   income tax expense
   (benefit)

 

 

(117

)

 

 

—

 

 

 

9

 

 

 

9

 

 

 

(108

)

 

 

46

 

 

 

(99

)

 

 

—

 

 

 

(55

)

Income tax expense
   (benefit)(2)

 

 

(31

)

 

 

—

 

 

 

6

 

 

 

6

 

 

 

(25

)

 

 

11

 

 

 

(23

)

 

 

—

 

 

 

(13

)

Net income (loss)

 

$

(86

)

 

$

—

 

 

$

3

 

 

$

3

 

 

$

(83

)

 

$

35

 

 

$

(76

)

 

$

—

 

 

$

(42

)

 

(1)
Core Earnings adjustments to GAAP:

 

 

Three Months Ended September 30, 2025

 

(Dollars in millions)

 

Net Impact of
Derivative
Accounting

 

 

Net Impact of
Goodwill and
Acquired
Intangibles

 

 

Total

 

Net interest income (loss) after provisions for loan losses

 

$

4

 

 

$

—

 

 

$

4

 

Total other income (loss)

 

 

4

 

 

 

—

 

 

 

4

 

Goodwill and acquired intangible asset impairment and amortization

 

 

—

 

 

 

(1

)

 

 

(1

)

Total Core Earnings adjustments to GAAP

 

$

8

 

 

$

1

 

 

 

9

 

Income tax expense (benefit)

 

 

 

 

 

 

 

 

6

 

Net income (loss)

 

 

 

 

 

 

 

$

3

 

 

(2)
Income taxes are based on a percentage of net income before tax for the individual reportable segment.

 

28

 

 

 

Three Months Ended September 30, 2024

 

 

 

 

 

 

Adjustments

 

 

 

 

 

Reportable Segments

 

(Dollars in millions)

 

Total
GAAP

 

 

Reclassi-
fications

 

 

Additions/
(Subtractions)

 

 

Total
Adjustments (1)

 

 

Total
Core
Earnings

 

 

Federal Education Loans

 

 

Consumer Lending

 

 

Business Processing

 

 

Other

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education loans

 

$

905

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

591

 

 

$

314

 

 

$

—

 

 

$

—

 

Cash and investments

 

 

43

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25

 

 

 

6

 

 

 

—

 

 

 

12

 

Total interest income

 

 

948

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

616

 

 

 

320

 

 

 

—

 

 

 

12

 

Total interest expense

 

 

828

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

576

 

 

 

198

 

 

 

—

 

 

 

34

 

Net interest income
   (loss)

 

 

120

 

 

$

8

 

 

$

12

 

 

$

20

 

 

$

140

 

 

 

40

 

 

 

122

 

 

 

—

 

 

 

(22

)

Less: provisions for loan
   losses

 

 

42

 

 

 

 

 

 

 

 

 

 

 

 

42

 

 

 

(5

)

 

 

47

 

 

 

—

 

 

 

—

 

Net interest income
   (loss) after provisions
   for loan losses

 

 

78

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

45

 

 

 

75

 

 

 

—

 

 

 

(22

)

Other income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Servicing revenue

 

 

13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11

 

 

 

2

 

 

 

—

 

 

 

—

 

Asset recovery and
   business processing
   revenue

 

 

70

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

70

 

 

 

—

 

Other revenue

 

 

(26

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

10

 

Gain on sale of subsidiary

 

 

219

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

219

 

 

 

—

 

Total other income

 

 

276

 

 

 

(8

)

 

 

44

 

 

 

36

 

 

 

312

 

 

 

11

 

 

 

2

 

 

 

289

 

 

 

10

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct operating
   expenses

 

 

121

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

20

 

 

 

44

 

 

 

57

 

 

 

—

 

Unallocated shared
   services expenses

 

 

63

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

63

 

Operating expenses

 

 

184

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

184

 

 

 

20

 

 

 

44

 

 

 

57

 

 

 

63

 

Goodwill and acquired
   intangible asset
   impairment and
   amortization

 

 

140

 

 

 

—

 

 

 

(140

)

 

 

(140

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Restructuring/other
   reorganization
   expenses

 

 

18

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

18

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

18

 

Total expenses

 

 

342

 

 

 

—

 

 

 

(140

)

 

 

(140

)

 

 

202

 

 

 

20

 

 

 

44

 

 

 

57

 

 

 

81

 

Income (loss) before
   income tax expense
   (benefit)

 

 

12

 

 

 

—

 

 

 

196

 

 

 

196

 

 

 

208

 

 

 

36

 

 

 

33

 

 

 

232

 

 

 

(93

)

Income tax expense
   (benefit)(2)

 

 

14

 

 

 

—

 

 

 

34

 

 

 

34

 

 

 

48

 

 

 

9

 

 

 

6

 

 

 

54

 

 

 

(21

)

Net income (loss)

 

$

(2

)

 

$

—

 

 

$

162

 

 

$

162

 

 

$

160

 

 

$

27

 

 

$

27

 

 

$

178

 

 

$

(72

)

 

(1)
Core Earnings adjustments to GAAP:

 

 

Three Months Ended September 30, 2024

 

(Dollars in millions)

 

Net Impact of
Derivative
Accounting

 

 

Net Impact of
Goodwill and
Acquired
Intangibles

 

 

Total

 

Net interest income (loss) after provisions for loan losses

 

$

20

 

 

$

—

 

 

$

20

 

Total other income (loss)

 

 

36

 

 

 

—

 

 

 

36

 

Goodwill and acquired intangible asset impairment and amortization

 

 

—

 

 

 

(140

)

 

 

(140

)

Total Core Earnings adjustments to GAAP

 

$

56

 

 

$

140

 

 

 

196

 

Income tax expense (benefit)

 

 

 

 

 

 

 

 

34

 

Net income (loss)

 

 

 

 

 

 

 

$

162

 

 

(2)
Income taxes are based on a percentage of net income before tax for the individual reportable segment.

 

29

 

 

 

Nine Months Ended September 30, 2025

 

 

 

 

 

 

Adjustments

 

 

 

 

 

Reportable Segments

 

(Dollars in millions)

 

Total
GAAP

 

 

Reclassi-
fications

 

 

Additions/
(Subtractions)

 

 

Total
Adjustments (1)

 

 

Total
Core
Earnings

 

 

Federal Education Loans

 

 

Consumer Lending

 

 

Business Processing

 

 

Other

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education loans

 

$

2,297

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

1,459

 

 

$

838

 

 

$

—

 

 

$

—

 

Cash and investments

 

 

64

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30

 

 

 

15

 

 

 

—

 

 

 

19

 

Total interest income

 

 

2,361

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,489

 

 

 

853

 

 

 

—

 

 

 

19

 

Total interest expense

 

 

1,961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,321

 

 

 

547

 

 

 

—

 

 

 

72

 

Net interest income
   (loss)

 

 

400

 

 

$

15

 

 

$

6

 

 

$

21

 

 

$

421

 

 

 

168

 

 

 

306

 

 

 

—

 

 

 

(53

)

Less: provisions for loan
   losses

 

 

236

 

 

 

 

 

 

 

 

 

 

 

 

236

 

 

 

29

 

 

 

207

 

 

 

—

 

 

 

—

 

Net interest income
   (loss) after provisions
   for loan losses

 

 

164

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

139

 

 

 

99

 

 

 

—

 

 

 

(53

)

Other income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Servicing revenue

 

 

40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

32

 

 

 

8

 

 

 

—

 

 

 

—

 

Asset recovery and
   business processing
   revenue

 

 

23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

23

 

 

 

—

 

Other revenue

 

 

10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1

)

 

 

1

 

 

 

—

 

 

 

44

 

Total other income
   (loss)

 

 

73

 

 

 

(15

)

 

 

49

 

 

 

34

 

 

 

107

 

 

 

31

 

 

 

9

 

 

 

23

 

 

 

44

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct operating
   expenses

 

 

189

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

54

 

 

 

115

 

 

 

20

 

 

 

—

 

Unallocated shared
   services expenses

 

 

144

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

144

 

Operating expenses(2)

 

 

333

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

333

 

 

 

54

 

 

 

115

 

 

 

20

 

 

 

144

 

Goodwill and acquired
   intangible asset
   impairment and
   amortization

 

 

2

 

 

 

—

 

 

 

(2

)

 

 

(2

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Restructuring/other
   reorganization
   expenses

 

 

6

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

6

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

6

 

Total expenses

 

 

341

 

 

 

—

 

 

 

(2

)

 

 

(2

)

 

 

339

 

 

 

54

 

 

 

115

 

 

 

20

 

 

 

150

 

Income (loss) before
   income tax expense
   (benefit)

 

 

(104

)

 

 

—

 

 

 

57

 

 

 

57

 

 

 

(47

)

 

 

116

 

 

 

(7

)

 

 

3

 

 

 

(159

)

Income tax expense
   (benefit)(3)

 

 

(29

)

 

 

—

 

 

 

18

 

 

 

18

 

 

 

(11

)

 

 

27

 

 

 

(3

)

 

 

1

 

 

 

(36

)

Net income (loss)

 

$

(75

)

 

$

—

 

 

$

39

 

 

$

39

 

 

$

(36

)

 

$

89

 

 

$

(4

)

 

$

2

 

 

$

(123

)

 

(1)
Core Earnings adjustments to GAAP:

 

 

Nine Months Ended September 30, 2025

 

(Dollars in millions)

 

Net Impact of
Derivative
Accounting

 

 

Net Impact of
Goodwill and
Acquired
Intangibles

 

 

Total

 

Net interest income (loss) after provisions for loan losses

 

$

21

 

 

$

—

 

 

$

21

 

Total other income (loss)

 

 

34

 

 

 

—

 

 

 

34

 

Goodwill and acquired intangible asset impairment and amortization

 

 

—

 

 

 

(2

)

 

 

(2

)

Total Core Earnings adjustments to GAAP

 

$

55

 

 

$

2

 

 

 

57

 

Income tax expense (benefit)

 

 

 

 

 

 

 

 

18

 

Net income (loss)

 

 

 

 

 

 

 

$

39

 

 

(2)
Income taxes are based on a percentage of net income before tax for the individual reportable segment.

 

30

 

 

 

Nine Months Ended September 30, 2024

 

 

 

 

 

 

Adjustments

 

 

 

 

 

Reportable Segments

 

(Dollars in millions)

 

Total
GAAP

 

 

Reclassi-
fications

 

 

Additions/
(Subtractions)

 

 

Total
Adjustments (1)

 

 

Total
Core
Earnings

 

 

Federal Education Loans

 

 

Consumer Lending

 

 

Business Processing

 

 

Other

 

Interest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Education loans

 

$

2,819

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

1,861

 

 

$

958

 

 

$

—

 

 

$

—

 

Cash and investments

 

 

129

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

75

 

 

 

20

 

 

 

—

 

 

 

34

 

Total interest income

 

 

2,948

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,936

 

 

 

978

 

 

 

—

 

 

 

34

 

Total interest expense

 

 

2,547

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,810

 

 

 

597

 

 

 

—

 

 

 

102

 

Net interest income
   (loss)

 

 

401

 

 

$

28

 

 

$

10

 

 

$

38

 

 

$

439

 

 

 

126

 

 

 

381

 

 

 

—

 

 

 

(68

)

Less: provisions for loan
   losses

 

 

68

 

 

 

 

 

 

 

 

 

 

 

 

68

 

 

 

(6

)

 

 

74

 

 

 

—

 

 

 

—

 

Net interest income
   (loss) after provisions
   for loan losses

 

 

333

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

132

 

 

 

307

 

 

 

—

 

 

 

(68

)

Other income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Servicing revenue

 

 

48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

39

 

 

 

9

 

 

 

—

 

 

 

—

 

Asset recovery and
   business processing
   revenue

 

 

228

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

228

 

 

 

—

 

Other revenue

 

 

33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

1

 

 

 

—

 

 

 

16

 

Gain on sale of subsidiary

 

 

219

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

219

 

 

 

—

 

Total other income

 

 

528

 

 

 

(28

)

 

 

17

 

 

 

(11

)

 

 

517

 

 

 

44

 

 

 

10

 

 

 

447

 

 

 

16

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct operating
   expenses

 

 

351

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

53

 

 

 

110

 

 

 

188

 

 

 

—

 

Unallocated shared
   services expenses

 

 

182

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

182

 

Operating expenses

 

 

533

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

533

 

 

 

53

 

 

 

110

 

 

 

188

 

 

 

182

 

Goodwill and acquired
   intangible asset
   impairment and
   amortization

 

 

145

 

 

 

—

 

 

 

(145

)

 

 

(145

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Restructuring/other
   reorganization
   expenses

 

 

35

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

35

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

35

 

Total expenses

 

 

713

 

 

 

—

 

 

 

(145

)

 

 

(145

)

 

 

568

 

 

 

53

 

 

 

110

 

 

 

188

 

 

 

217

 

Income (loss) before
   income tax expense
   (benefit)

 

 

148

 

 

 

—

 

 

 

172

 

 

 

172

 

 

 

320

 

 

 

123

 

 

 

207

 

 

 

259

 

 

 

(269

)

Income tax expense
   (benefit)(2)

 

 

41

 

 

 

—

 

 

 

33

 

 

 

33

 

 

 

74

 

 

 

28

 

 

 

47

 

 

 

60

 

 

 

(61

)

Net income (loss)

 

$

107

 

 

$

—

 

 

$

139

 

 

$

139

 

 

$

246

 

 

$

95

 

 

$

160

 

 

$

199

 

 

$

(208

)

 

(1)
Core Earnings adjustments to GAAP:

 

 

Nine Months Ended September 30, 2024

 

(Dollars in millions)

 

Net Impact of
Derivative
Accounting

 

 

Net Impact of
Goodwill and
Acquired
Intangibles

 

 

Total

 

Net interest income (loss) after provisions for loan losses

 

$

38

 

 

$

—

 

 

$

38

 

Total other income (loss)

 

 

(11

)

 

 

—

 

 

 

(11

)

Goodwill and acquired intangible asset impairment and amortization

 

 

—

 

 

 

(145

)

 

 

(145

)

Total Core Earnings adjustments to GAAP

 

$

27

 

 

$

145

 

 

 

172

 

Income tax expense (benefit)

 

 

 

 

 

 

 

 

33

 

Net income (loss)

 

 

 

 

 

 

 

$

139

 

 

(2)
Income taxes are based on a percentage of net income before tax for the individual reportable segment.

 

 

31

 

The following discussion summarizes the differences between Core Earnings and GAAP net income and details each specific adjustment required to reconcile our Core Earnings segment presentation to our GAAP earnings.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

GAAP net income (loss)

 

$

(86

)

 

$

(2

)

 

$

(75

)

 

$

107

 

Core Earnings adjustments to GAAP:

 

 

 

 

 

 

 

 

 

 

 

 

Net impact of derivative accounting

 

 

8

 

 

 

56

 

 

 

55

 

 

 

27

 

Net impact of goodwill and acquired intangible assets

 

 

1

 

 

 

140

 

 

 

2

 

 

 

145

 

Net income tax effect

 

 

(6

)

 

 

(34

)

 

 

(18

)

 

 

(33

)

Total Core Earnings adjustments to GAAP

 

 

3

 

 

 

162

 

 

 

39

 

 

 

139

 

Core Earnings net income (loss)

 

$

(83

)

 

$

160

 

 

$

(36

)

 

$

246

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Derivative Accounting: Core Earnings exclude periodic gains and losses that are caused by the mark-to-market valuations on derivatives that do not qualify for hedge accounting treatment under GAAP, as well as the periodic mark-to-market gains and losses that are a result of ineffectiveness recognized related to effective hedges under GAAP. Under GAAP, for our derivatives that are held to maturity, the mark-to-market gain or loss over the life of the contract will equal $0. In our Core Earnings presentation, we recognize the economic effect of these hedges, which generally results in any net settlement cash paid or received being recognized ratably as an interest expense or revenue over the hedged item’s life.

The accounting for derivatives requires that changes in the fair value of derivative instruments be recognized currently in earnings, with no fair value adjustment of the hedged item, unless specific hedge accounting criteria are met. The gains and losses recorded in “Gains (losses) on derivative and hedging activities, net” and interest expense (for qualifying fair value hedges) are primarily caused by interest rate and foreign currency exchange rate volatility and changing credit spreads during the period as well as the volume and term of derivatives not receiving hedge accounting treatment. We believe that our derivatives are effective economic hedges, and as such, are a critical element of our interest rate and foreign currency risk management strategy. However, some of our derivatives do not qualify for hedge accounting treatment and the stand-alone derivative is adjusted to fair value in the income statement with no consideration for the corresponding change in fair value of the hedged item. See our 2024 Form 10-K for further discussion.

 

32

 

The table below quantifies the adjustments for derivative accounting between GAAP and Core Earnings net income.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Core Earnings derivative adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

(Gains) losses on derivative and hedging activities, net,
   included in other income

 

$

4

 

 

$

36

 

 

$

34

 

 

$

(11

)

Plus: (Gains) losses on fair value hedging activity included
   in interest expense

 

 

(2

)

 

 

10

 

 

 

—

 

 

 

5

 

Total (gains) losses in GAAP net income

 

 

2

 

 

 

46

 

 

 

34

 

 

 

(6

)

Plus: Reclassification of settlement income (expense) on
   derivative and hedging activities, net(1)

 

 

4

 

 

 

8

 

 

 

15

 

 

 

28

 

Mark-to-market (gains) losses on derivative and hedging
   activities, net(2)

 

 

6

 

 

 

54

 

 

 

49

 

 

 

22

 

Other derivative accounting adjustments(3)

 

 

2

 

 

 

2

 

 

 

6

 

 

 

5

 

Total net impact of derivative accounting

 

$

8

 

 

$

56

 

 

$

55

 

 

$

27

 

 

(1)
Derivative accounting requires net settlement income/expense on derivatives that do not qualify as hedges to be recorded in a separate income statement line item below net interest income. Under our Core Earnings presentation, these settlements are reclassified to the income statement line item of the economically hedged item. For our Core Earnings net interest income, this would primarily include reclassifying the net settlement amounts related to certain of our interest rate swaps to debt interest expense. The table below summarizes these net settlements on derivative and hedging activities and the associated reclassification on a Core Earnings basis.

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

(Dollars in millions)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Reclassification of settlements on derivative and
   hedging activities:

 

 

 

 

 

 

 

 

 

 

 

 

Net settlement income (expense) on interest rate
   swaps reclassified to net interest income

 

$

4

 

 

$

8

 

 

$

15

 

 

$

28

 

Total reclassifications of settlement income
   (expense) on derivative and hedging activities

 

$

4

 

 

$

8

 

 

$

15

 

 

$

28

 
(2)
“Mark-to-market (gains) losses on derivative and hedging activities, net” is comprised of the following:

 

 

Three Months Ended September 30,