XML 25 R13.htm IDEA: XBRL DOCUMENT
v3.5.0.2

Borrowings | 9 Months Ended
--- | ---
Sep. 30, 2016
Debt Disclosure [Abstract] |
Borrowings | Borrowings Outstanding borrowings consist of secured borrowings issued through our term asset-backed securitization (“ABS”) program and our asset-backed commercial paper (“ABCP”) funding facility (the “ABCP Facility”). The following table summarizes our secured borrowings at September 30, 2016 and December 31, 2015.
|  | September 30, 2016 |  | December 31, 2015
|  | Short-Term |  | Long-Term |  | Total |  | Short-Term |  | Long-Term |  | Total
Secured borrowings: |  |  |  |  |  |  |  |  |  |  |  |
Private Education Loan term securitization |  | $ | — |  |  | $ | 1,577,689 |  |  | $ | 1,577,689 |  |  | $ | — |  |  | $ | 579,101 |  |  | $ | 579,101 |
ABCP Facility |  | 350,000 |  |  | — |  |  | 350,000 |  |  | 500,175 |  |  | — |  |  | 500,175 |
Total |  | $ | 350,000 |  |  | $ | 1,577,689 |  |  | $ | 1,927,689 |  |  | $ | 500,175 |  |  | $ | 579,101 |  |  | $ | 1,079,276 |
Short-term Borrowings Asset-Backed Commercial Paper Funding Facility On December 19, 2014, we closed on a $750.0 million ABCP Facility. We retained a 5 percent or $37.5 million participation interest in the ABCP Facility, resulting in $712.5 million of funds available for us to draw under the ABCP Facility. During 2015, we incurred financing costs under the ABCP Facility of approximately 0.40 percent on average on unused borrowing capacity and approximately 3-month LIBOR plus 0.80 percent on outstandings under the ABCP Facility. On February 25, 2016, we amended and extended the maturity of our ABCP Facility. The amended ABCP Facility is a $750.0 million ABCP Facility, in which we no longer hold a participation interest. As a result, the full $750.0 million is available for us to draw. We hold 100 percent of the residual interest in the ABCP Facility trust. Under the amended ABCP Facility, we incur financing costs of between 0.35 percent and 0.45 percent on unused borrowing capacity and approximately 3‑month LIBOR plus 1.00 percent on outstandings. The amended ABCP Facility extends the revolving period, during which we may borrow, repay and reborrow funds, until February 23, 2017. The scheduled amortization period, during which amounts outstanding under the ABCP Facility must be repaid, ends on February 23, 2018 (or earlier, if certain material adverse events occur). At September 30, 2016, $350 million was outstanding under the ABCP Facility. At September 30, 2016, $428.7 million of our Private Education Loans were encumbered to support outstandings under the ABCP Facility. Short-term borrowings have a remaining term to maturity of one year or less. The ABCP Facility’s contractual maturity is two years from the date of inception or renewal (one year revolving period plus a one year amortization period); however, we classify advances under our ABCP Facility as short-term borrowings because it is our intention to repay those advances within one year. Long-term Borrowings On May 26, 2016, we executed our $551 million SMB Private Education Loan Trust 2016-A term ABS transaction, which was accounted for as an on-balance sheet secured financing. We retained a 100 percent or $50 million interest in the Class B notes and 100 percent of the residual certificates issued in the securitization. $501 million of Class A notes from the securitization were sold to third parties, raising $501 million of gross proceeds. The Class A notes had a weighted average life of 4.01 years and priced at a weighted average LIBOR equivalent cost of 1-month LIBOR plus 1.38 percent. At September 30, 2016, $571 million of our Private Education Loans were encumbered as a result of this transaction. On July 21, 2016, we executed our $657 million SMB Private Education Loan Trust 2016-B term ABS transaction, which was accounted for as an on-balance sheet secured financing. We retained a 100 percent or $50 million interest in the Class B notes and 100 percent of the residual certificates issued in the securitization. $607 million of Class A notes from the securitization were sold to third parties, raising $607 million of gross proceeds. The Class A notes had a weighted average life of 4.01 years and priced at a weighted average LIBOR equivalent cost of 1-month LIBOR plus 1.36 percent. At September 30, 2016, $692 million of our Private Education Loans were encumbered as a result of this transaction. Secured Financings at Issuance
Issue |  | Date Issued |  | Total Issued |  | Weighted Average Cost of Funds(1) |  | Weighted Average Life (in years)
Private Education: |  |  |  |  |  |
2015-B |  | July 2015 |  | $ | 630,800 |  |  | 1-month LIBOR plus 1.53% |  | 4.82
Total notes issued in 2015 |  | $ | 630,800 |  |  |  |  |
Total loan and accrued interest amount securitized at inception in 2015 |  | $ | 745,580 |  |  |  |  |
2016-A |  | May 2016 |  | $ | 501,000 |  |  | 1-month LIBOR plus 1.38% |  | 4.01
2016-B |  | July 2016 |  | $ | 607,000 |  |  | 1-month LIBOR plus 1.36% |  | 4.01
Total notes issued in 2016 |  | $ | 1,108,000 |  |  |  |  |
Total loan and accrued interest amount securitized at inception in 2016 |  | $ | 1,364,481 |  |  |  |  |
____________ (1) Represents LIBOR equivalent cost of funds for floating and fixed rate bonds, excluding issuance costs. Consolidated Funding Vehicles We consolidate our financing entities that are VIEs as a result of our being the entities’ primary beneficiary. As a result, these financing VIEs are accounted for as secured borrowings. We consolidate the following financing VIEs as of September 30, 2016 and December 31, 2015, respectively:
|  | September 30, 2016
|  | Debt Outstanding |  | Carrying Amount of Assets Securing Debt Outstanding
|  | Short-Term |  | Long-Term |  | Total |  | Loans |  | Restricted Cash |  | Other Assets(1) |  | Total
Secured borrowings: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Private Education Loan term securitization |  | $ | — |  |  | $ | 1,577,689 |  |  | $ | 1,577,689 |  |  | $ | 1,901,146 |  |  | $ | 27,597 |  |  | $ | 133,896 |  |  | $ | 2,062,639 |
ABCP Facility |  | 350,000 |  |  | — |  |  | 350,000 |  |  | 428,706 |  |  | 6,682 |  |  | 29,413 |  |  | 464,801 |
Total |  | $ | 350,000 |  |  | $ | 1,577,689 |  |  | $ | 1,927,689 |  |  | $ | 2,329,852 |  |  | $ | 34,279 |  |  | $ | 163,309 |  |  | $ | 2,527,440 |
____ (1) Other assets primarily represent accrued interest receivable.
|  | December 31, 2015
|  | Debt Outstanding |  | Carrying Amount of Assets Securing Debt Outstanding
|  | Short-Term |  | Long-Term |  | Total |  | Loans |  | Restricted Cash |  | Other Assets(1) |  | Total
Secured borrowings: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Private Education Loan term securitization |  | $ | — |  |  | $ | 579,101 |  |  | $ | 579,101 |  |  | $ | 687,298 |  |  | $ | 9,996 |  |  | $ | 45,566 |  |  | $ | 742,860 |
ABCP Facility |  | 500,175 |  |  | — |  |  | 500,175 |  |  | 923,687 |  |  | 12,443 |  |  | 58,095 |  |  | 994,225 |
Total |  | $ | 500,175 |  |  | $ | 579,101 |  |  | $ | 1,079,276 |  |  | $ | 1,610,985 |  |  | $ | 22,439 |  |  | $ | 103,661 |  |  | $ | 1,737,085 |
____ (1) Other assets primarily represent accrued interest receivable. Other Borrowing Sources We maintain discretionary uncommitted Federal Funds lines of credit with various correspondent banks, which totaled $100 million at September 30, 2016. The interest rate we are charged on these lines of credit is priced at Fed Funds plus a spread at the time of borrowing, and is payable daily. We did not utilize these lines of credit in the three and nine months ended September 30, 2016 and in the year ended December 31, 2015. We established an account at the Federal Reserve Bank (“FRB”) to meet eligibility requirements for access to the Primary Credit borrowing facility at the FRB’s Discount Window (the “Window”). The Primary Credit borrowing facility is a lending program available to depository institutions that are in generally sound financial condition. All borrowings at the Window must be fully collateralized. We can pledge to the FRB asset-backed and mortgage-backed securities, as well as FFELP Loans and Private Education Loans, as collateral for borrowings at the Window. Generally, collateral value is assigned based on the estimated fair value of the pledged assets. At September 30, 2016 and December 31, 2015, the value of our pledged collateral at the FRB totaled $2.5 billion and $1.7 billion, respectively. The interest rate charged to us is the discount rate set by the FRB. We did not utilize this facility in the three and nine months ended September 30, 2016 and in the year ended December 31, 2015.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration