Sallie Mae reports 1996 second quarter net income of $103.0 million.WASHINGTON--(BUSINESS WIRE)--July 11, 1996--Sallie Mae (NYSE NYSE See: New York Stock Exchange :SLM See service level management system and spatial light modulator. ) Thursday Thursday: see week. reported net income of $103.0 million, or $1.79 per common share, for the quarter ended June June: see month. 30, 1996. This compares to $102.9 million ($1.74 per share) in the first quarter of 1996 and $88.0 million ($1.20 per share) in the second quarter of 1995. Net income increased 17 percent over the 1995 second quarter, primarily due to 12 percent growth in managed student loan assets, significantly lower servicing and operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , and higher net floor revenues. EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. was further enhanced by Sallie Mae's repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of its common shares over the past year, including 1.1 million shares purchased during the second quarter of 1996. The corporation recognized as earnings $9 million, after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. , of net floor revenues for the second quarter of 1996, down slightly from $10 million in the 1996 first quarter. Floor revenues represent additional income the corporation receives on certain loans in low interest rate environments. Core net income (earnings net of recognized floor revenues) for the 1996 second quarter was $94.0 million ($1.63 per share), up slightly from $92.9 million ($1.57 per share) for the prior quarter and up 7 percent from $87.7 million ($1.19 per share) for the year ago quarter. "Our strategy to maximize In a graphical environment, to enlarge a window to the full size of the screen. See Win Maximize windows. share value by building customer preference based on outstanding products and services is paying off in continued strong student loan growth despite lower originations in the bank-based program," said Lawrence Lawrence. 1 City (1990 pop. 26,763), Marion co., central Ind., a residential suburb of Indianapolis, on the West Fork of the White River. It has light manufacturing. 2 City (1990 pop. 65,608), seat of Douglas co., NE Kans. A. Hough n. 1. Same as Hock, a joint. v. t. 1. Same as Hock, to hamstring. [ imp. & p. p. os> r>; p. pr. & vb. n. os> n. 1. An adz; a hoe. v. t. 1. To cut with a hoe. , president and chief executive officer. "This quarter's solid performance reflects well on our continued efforts to operate more efficiently, evidenced by the fifth consecutive quarter of lower servicing costs. We are firmly on track to achieve our budget plan to reduce operating expenses in 1996 by 19 percent." Sallie Mae Sallie Mae: see SLM Corporation. purchased $2.4 billion of student loans in the second quarter of 1996, up slightly from $2.3 billion in the previous quarter and down 18 percent from $2.9 billion in the year ago quarter, which included $400 million of one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. portfolio liquidations. The total portfolio of loans managed at June 30, 1996 grew to $37.4 billion, up 12 percent over $33.4 billion at June 30, 1995. Sallie Mae managed $3.7 billion of securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. student loans at June 30, 1996, including $1.5 billion securitized during the 1996 second quarter. A total of $1.1 billion, or 47 percent, of the second quarter's loan purchases came from our ExportSS(R) lender LENDER, contracts. He from whom a thing is borrowed. 2. The contract of loan confers rights, and imposes duties on the lender. 1. The lender has the right to revoke the loan at his mere pleasure; 9 Cowen, R. 687; 8 Johns. Rep. 432; 1 T. R. 480; 2 Campb. Rep. clients, compared to $1.2 billion, or 42 percent, a year ago. A centerpiece of the corporation's marketing strategy, ExportSS is Sallie Mae's off-site off-site adj. Taking place or located away from the site, as of a particular activity: an off-site waste treatment operation. off loan origination The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. and administration service for lenders who choose to outsource outsource verb To assign specific work to a 3rd party for a specific length of time at an set price and service level Managed care To use outside labor to perform functions–billing and collections, accounting, janitorial services, ER their student loan operations and commit to sell their loans to Sallie Mae. Despite substantial growth in direct government lending's share of national student loan originations, the ExportSS pipeline of loans currently serviced and committed for purchase by Sallie Mae was $3.7 billion at June 30, 1996, down only slightly from $3.8 billion a year ago. On a separate matter, Sallie Mae is currently negotiating a restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). of its arrangement with The Chase Manhattan Corporation The Chase Manhattan Corporation was a bank holding company formed as parent of the Chase Manhattan Bank. During its time as the parent company, it was led in succession by David Rockefeller, Willard C. Butcher, and Thomas G. Labrecque. , in light of Chase's merger with Chemical Banking Corp. Chase is Sallie Mae's largest lender client. Commenting on the negotiations, Lydia Lydia, ancient country, Asia Lydia, ancient country, W Asia Minor, N of Caria and S of Mysia (now NW Turkey). The tyrant Gyges was the founder of the Mermnadae dynasty, which lasted from c.700 B.C. to 550 B.C. M. Marshall Marshall. 1 City (1990 pop. 12,711), seat of Saline co., N central Mo.; inc. 1839. In a large farm area, it is a processing center for grain, eggs, meat, and dairy products. Marshall is the seat of Missouri Valley College. , executive vice president, marketing, said, "The discussions are continuing and we expect an agreement during the third quarter of 1996." In the fourth quarter of 1995, the corporation changed its accounting method of deferring a portion of the income it earns on student loans. Generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting require that the cumulative effect of the change in accounting method be reflected as of the beginning of the year the change is made and the subsequent quarters' results be restated. Therefore 7 cents of the $1.20 EPS reported in the second quarter of 1995 represented the effect of the accounting change for that period. -0- Sallie Mae, a stockholder-owned corporation, is the nation's leading provider of financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. for postsecondary education needs. The corporation is the nation's largest source of funding and servicing support for education loans for students and their parents. It is also a leading provider of financing to colleges and universities for their facilities and equipment. -0-
Student Loan Marketing Association
Supplemental Earnings Disclosure
June 30, 1996
(Dollars in thousands, except EPS)
Quarters ended
---------------------------------
June 30, March 31, June 30,
1996 1996 1995
-------- -------- --------
Net income $102,975 $102,900 $ 88,022
Core net income $ 93,985 $ 92,887 $ 87,675
Earnings per common share $ 1.79 $ 1.74 $ 1.20 Core earnings per common share $ 1.63 $ 1.57 $ 1.19 Net interest margin 1.61% 1.54% 1.35% Net interest margin, including managed assets 1.51 1.50 1.35 Core net interest margin 1.50 1.41 1.35 Return on assets .88% .85% .68% Return on assets, including managed assets .82 .83 .68 Core return on assets .80 .77 .68 Student loan spread 1.87% 1.79% 1.47% Core student loan spread 1.70 1.61 1.46
Six months ended
June 30,
-----------------
1996 1995(a)
---- ----
Net income $205,875 $176,816
Core net income $186,872 $176,470
Earnings per common share $ 3.53 $ 2.37 Core earnings per common share $ 3.20 $ 2.37 Net interest margin 1.58% 1.35% Net interest margin, including managed assets 1.50 1.35 Core net interest margin 1.45 1.35 Return on assets .86% .69% Return on assets, including managed assets .82 .69 Core return on assets .78 .69 Student loan spread 1.83% 1.49% Core student loan spread 1.66 1.49
(a) The results for the six months ended June 30, 1995 are presented
on a pro forma basis, assuming the change in method of accounting
for student loan income was effective prior to 1995.
Student Loan Marketing Association
Consolidated Statements of Income
(In thousands, except per share amounts)
Quarters ended
--------------------------------
June 30, March 31, June 30,
1996 1996 1995
---------- ---------- ---------
Interest income on loans:
Insured student loans purchased $644,054 $660,611 $660,777
Gain on sale of student loans 9,474 9,929 --
Servicing costs (47,673) (52,748) (56,943)
---------- ---------- ----------
Insured student loans purchased,
net 605,855 617,792 603,834
Warehousing advances 53,204 62,149 109,164
Academic facilities financings 25,113 23,584 28,805
---------- ---------- ----------
Total interest income on loans 684,172 703,525 741,803
Income from investments,
principally interest 136,957 137,067 182,225
---------- ---------- ----------
Total interest income 821,129 840,592 924,028
Interest expense 640,079 654,811 763,676
---------- ---------- ----------
Net interest income 181,050 185,781 160,352
Operating expenses 33,735 30,121 41,143
---------- ---------- ----------
Income before federal income taxes,
premiums on debt extinguished
and cumulative effect of the
change in method of accounting
for student loan income 147,315 155,660 119,209
Federal income taxes 44,340 47,968 31,187
---------- ---------- ----------
Income before premiums on debt
extinguished and cumulative
effect of the change in method
of accounting for student loan
income 102,975 107,692 88,022
Premiums on debt extinguished,
net of tax -- (4,792) --
---------- ---------- ----------
Income before cumulative
effect of the change in method
of accounting for student loan
income 102,975 102,900 88,022
Cumulative effect of the change
in method of accounting for
student loan income, net of tax
(through Dec. 31, 1994) -- -- --
---------- ---------- ----------
NET INCOME 102,975 102,900 88,022
Preferred stock dividend 2,674 2,673 2,673
---------- ---------- ----------
Net income attributable to
common stock $100,301 $100,227 $ 85,349
========== ========== ==========
Earnings per common share before
premiums on debt extinguished
and cumulative effect of the
change in method of accounting
for student loan income $1.79 $1.82 $1.20
Effect of premiums on debt
extinguished, net of tax -- (.08) --
---------- ---------- ----------
Earnings per common share before
cumulative effect of the change
in method of accounting for
student loan income 1.79 1.74 1.20
Cumulative effect of change in
the method of accounting for
student loan income, net of tax
(through Dec. 31, 1994) -- -- --
---------- ---------- ----------
Earnings per common share $1.79 $1.74 $1.20
========== ========== ==========
Average common and common
equivalent shares outstanding 56,083 57,479 71,183
========== ========== ==========
Six months ended
June 30,
---------------------
1996 1995
---------- ----------
Interest income on loans:
Insured student loans purchased $1,304,665 $1,299,227
Gain on sale of student loans 19,403 --
Servicing costs (100,421) (109,723)
---------- ----------
Insured student loans purchased,
net 1,223,647 1,189,504
Warehousing advances 115,353 227,043
Academic facilities financings 48,697 56,748
---------- ----------
Total interest income on loans 1,387,697 1,473,295
Income from investments,
principally interest 274,024 366,548
---------- ----------
Total interest income 1,661,721 1,839,843
Interest expense 1,294,890 1,523,756
---------- ----------
Net interest income 366,831 316,087
Operating expenses 63,856 77,178
---------- ----------
Income before federal income taxes,
premiums on debt extinguished
and cumulative effect of the
change in method of accounting
for student loan income 302,975 238,909
Federal income taxes 92,308 62,093
---------- ----------
Income before premiums on debt
extinguished and cumulative
effect of the change in method
of accounting for student loan
income 210,667 176,816
Premiums on debt extinguished,
net of tax (4,792) --
---------- ----------
Income before cumulative
effect of the change in method
of accounting for student loan
income 205,875 176,816
Cumulative effect of the change
in method of accounting for
student loan income, net of tax
(through Dec. 31, 1994) -- 130,148
---------- ----------
NET INCOME 205,875 306,964
Preferred stock dividend 5,347 5,347
---------- ----------
Net income attributable to
common stock $200,528 $301,617
========== ==========
Earnings per common share before
premiums on debt extinguished
and cumulative effect of the
change in method of accounting
for student loan income $3.62 $2.38
Effect of premiums on debt
extinguished, net of tax (.09) --
---------- ----------
Earnings per common share before
cumulative effect of the change
in method of accounting for
student loan income 3.53 2.38
Cumulative effect of change in
the method of accounting for
student loan income, net of tax
(through Dec. 31, 1994) -- 1.80
---------- ----------
Earnings per common share $3.53 $4.18
========== ==========
Average common and common
equivalent shares outstanding 56,783 72,234
========== ==========
Student Loan Marketing Association
Consolidated Balance Sheets
(In thousands, except per share amounts)
June 30, March 31, June 30,
Assets 1996 1996 1995
----------- ----------- -----------
Insured student loans
purchased $33,652,949 $33,880,614 $33,371,865
Warehousing advances 2,971,817 3,338,196 6,325,853
Academic facilities financings 1,545,682 1,371,222 1,525,079
Cash and investments 7,457,590 7,989,185 11,361,209
Other assets, principally
accrued interest receivable 1,735,227 1,594,348 1,539,455
----------- ----------- -----------
Total assets $47,363,265 $48,173,565 $54,123,461
=========== =========== ===========
Liabilities
Short-term borrowings $19,085,925 $17,991,745 $13,434,712
Long-term notes 25,632,109 27,731,088 37,833,441
Other liabilities,
principally accrued
interest payable 1,628,057 1,425,999 1,336,449
----------- ----------- -----------
Total liabilities 46,346,091 47,148,832 52,604,602
----------- ----------- -----------
Commitments(b) Stockholders' equity
Preferred stock, par value
$50.00 per share,
5,000 shares authorized
and issued, 4,278 shares
outstanding 213,883 213,883 213,883
Common stock, par value
$.20 per share,
250,000 shares authorized:
124,556; 124,483; and
123,855 shares,
respectively, issued 24,911 24,897 24,771
Additional paid-in capital 555,569 552,574 524,930
Unrealized gains on investments,
net of tax 335,620 342,518 328,598
Retained earnings 2,883,682 2,805,688 2,591,614
----------- ----------- -----------
Stockholders' equity before
treasury stock 4,013,665 3,939,560 3,683,796
Common stock held in treasury
at cost: 69,054; 67,957;
and 55,355 shares,
respectively 2,996,491 2,914,827 2,164,937
----------- ----------- -----------
Total stockholders' equity 1,017,174 1,024,733 1,518,859
----------- ----------- -----------
Total liabilities and
stockholders' equity $47,363,265 $48,173,565 $54,123,461
(b) Commitments to purchase loans, commitments under lines of credit
and letters of credit, and academic facilities financing
commitments were $11.2 billion, $.7 billion, $3.1 billion, and
$.1 billion, respectively, at June 30, 1996.
CONTACT: Sallie Mae, Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. Gisela For other uses, see Gisela (name). Gisela (757 – 810) was the only daughter of Pippin the Younger and his wife Bertrada of Laon. She was the sister of Charlemagne and Carloman. Vallandigham, 202/298-3147 or Ross Ross , Sir Ronald 1857-1932. British physician. He won a 1902 Nobel Prize for proving that malaria is transmitted to humans by the bite of the mosquito. Kleinman Kleinman is a common surname:
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