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Allowance for Loan Losses | 6 Months Ended
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Jun. 30, 2025
Receivables [Abstract] |
Allowance for Loan Losses | 2. Allowance for Loan Losses Allowance for Loan Losses Roll Forward
|  | Three Months Ended June 30, |
|  | 2025 |  |  | 2024 |
(Dollars in millions) |  | FFELP Loans |  |  | Private Education Loans |  |  | Total |  |  | FFELP Loans |  |  | Private Education Loans |  |  | Total |
Allowance at beginning of period |  | $ | 182 |  |  | $ | 397 |  |  | $ | 579 |  |  | $ | 206 |  |  | $ | 538 |  |  | $ | 744 |
Total provision |  |  | 8 |  |  |  | 29 |  |  |  | 37 |  |  |  | (2 | ) |  |  | 16 |  |  |  | 14 |
Charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gross charge-offs |  |  | (8 | ) |  |  | (92 | ) |  |  | (100 | ) |  |  | (10 | ) |  |  | (77 | ) |  |  | (87 | )
Expected future recoveries on current period gross charge-offs |  |  | — |  |  |  | 13 |  |  |  | 13 |  |  |  | — |  |  |  | 10 |  |  |  | 10 |
Total(1) |  |  | (8 | ) |  |  | (79 | ) |  |  | (87 | ) |  |  | (10 | ) |  |  | (67 | ) |  |  | (77 | )
Adjustment resulting from the change in charge-off rate(2) |  |  | — |  |  |  | (1 | ) |  |  | (1 | ) |  |  | — |  |  |  | — |  |  |  | — |
Net charge-offs |  |  | (8 | ) |  |  | (80 | ) |  |  | (88 | ) |  |  | (10 | ) |  |  | (67 | ) |  |  | (77 | )
Decrease in expected future recoveries on previously fully charged-off loans(3) |  |  | — |  |  |  | 2 |  |  |  | 2 |  |  |  | — |  |  |  | 6 |  |  |  | 6 |
Allowance at end of period |  | $ | 182 |  |  | $ | 348 |  |  | $ | 530 |  |  | $ | 194 |  |  | $ | 493 |  |  | $ | 687 |
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) |  |  | .14 | % |  |  | 2.06 | % |  |  |  |  |  | .14 | % |  |  | 1.65 | % |  |  |
Net adjustment resulting from the change in charge -off rate as a percentage of average loans in repayment (annualized)(2) |  |  | — | % |  |  | .02 | % |  |  |  |  |  | — | % |  |  | — | % |  |  |
Net charge-offs as a percentage of average loans in repayment (annualized) |  |  | .14 | % |  |  | 2.08 | % |  |  |  |  |  | .14 | % |  |  | 1.65 | % |  |  |
Ending total loans |  | $ | 29,800 |  |  | $ | 15,878 |  |  |  |  |  | $ | 33,134 |  |  | $ | 16,731 |  |  |  |
Average loans in repayment |  | $ | 25,133 |  |  | $ | 15,375 |  |  |  |  |  | $ | 27,509 |  |  | $ | 16,271 |  |  |  |
Ending loans in repayment |  | $ | 24,867 |  |  | $ | 15,267 |  |  |  |  |  | $ | 26,411 |  |  | $ | 16,087 |  |  |  |
(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 June 30, |
(Dollars in millions) |  | 2025 |  |  | 2024 |
Beginning of period expected future recoveries on previously fully charged-off loans |  | $ | 174 |  |  | $ | 217 |
Expected future recoveries of current period defaults |  |  | 13 |  |  |  | 10 |
Recoveries (cash collected) |  |  | (11 | ) |  |  | (10 | )
Charge-offs (as a result of lower recovery expectations) |  |  | (4 | ) |  |  | (6 | )
End of period expected future recoveries on previously fully charged-off loans |  | $ | 172 |  |  | $ | 211 |
Change in balance during period |  | $ | (2 | ) |  | $ | (6 | )
2. Allowance for Loan Losses (Continued) Allowance for Loan Losses Roll Forward
|  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |
(Dollars in millions) |  | FFELP Loans |  |  | Private Education Loans |  |  | Total |  |  | FFELP Loans |  |  | Private Education Loans |  |  | Total |
Allowance at beginning of period |  | $ | 180 |  |  | $ | 441 |  |  | $ | 621 |  |  | $ | 215 |  |  | $ | 617 |  |  | $ | 832 |
Total provision |  |  | 16 |  |  |  | 51 |  |  |  | 67 |  |  |  | (1 | ) |  |  | 27 |  |  |  | 26 |
Charge-offs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gross charge-offs |  |  | (14 | ) |  |  | (173 | ) |  |  | (187 | ) |  |  | (20 | ) |  |  | (187 | ) |  |  | (207 | )
Expected future recoveries on current period gross charge-offs |  |  | — |  |  |  | 23 |  |  |  | 23 |  |  |  | — |  |  |  | 21 |  |  |  | 21 |
Total(1) |  |  | (14 | ) |  |  | (150 | ) |  |  | (164 | ) |  |  | (20 | ) |  |  | (166 | ) |  |  | (186 | )
Adjustment resulting from the change in charge-off rate(2) |  |  | — |  |  |  | (2 | ) |  |  | (2 | ) |  |  | — |  |  |  | — |  |  |  | — |
Net charge-offs |  |  | (14 | ) |  |  | (152 | ) |  |  | (166 | ) |  |  | (20 | ) |  |  | (166 | ) |  |  | (186 | )
Decrease in expected future recoveries on previously fully charged-off loans(3) |  |  | — |  |  |  | 8 |  |  |  | 8 |  |  |  | — |  |  |  | 15 |  |  |  | 15 |
Allowance at end of period |  | $ | 182 |  |  | $ | 348 |  |  | $ | 530 |  |  | $ | 194 |  |  | $ | 493 |  |  | $ | 687 |
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) |  |  | .12 | % |  |  | 1.96 | % |  |  |  |  |  | .14 | % |  |  | 2.03 | % |  |  |
Net adjustment resulting from the change in charge -off rate as a percentage of average loans in repayment (annualized)(2) |  |  | — | % |  |  | .02 | % |  |  |  |  |  | — | % |  |  | — | % |  |  |
Net charge-offs as a percentage of average loans in repayment (annualized) |  |  | .12 | % |  |  | 1.98 | % |  |  |  |  |  | .14 | % |  |  | 2.03 | % |  |  |
Ending total loans |  | $ | 29,800 |  |  | $ | 15,878 |  |  |  |  |  | $ | 33,134 |  |  | $ | 16,731 |  |  |  |
Average loans in repayment |  | $ | 25,295 |  |  | $ | 15,423 |  |  |  |  |  | $ | 28,622 |  |  | $ | 16,471 |  |  |  |
Ending loans in repayment |  | $ | 24,867 |  |  | $ | 15,267 |  |  |  |  |  | $ | 26,411 |  |  | $ | 16,087 |  |  |  |
(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
|  | Six Months Ended June 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 |  |  | 23 |  |  |  | 21 |
Recoveries (cash collected) |  |  | (21 | ) |  |  | (21 | )
Charge-offs (as a result of lower recovery expectations) |  |  | (10 | ) |  |  | (15 | )
End of period expected future recoveries on previously fully charged-off loans |  | $ | 172 |  |  | $ | 211 |
Change in balance during period |  | $ | (8 | ) |  | $ | (15 | )
2. Allowance for Loan Losses (Continued) Key Credit Quality Indicators We assess and determine the collectability of our education loan portfolios by evaluating certain risk characteristics we refer to as key credit quality indicators. Key credit quality indicators are incorporated into the allowance for loan losses calculation. FFELP Loans FFELP Loans are substantially insured and guaranteed as to their principal and accrued interest in the event of default. The key credit quality indicators are loan status and loan type.
|  | FFELP Loan Delinquencies |
|  | June 30, 2025 |  |  | December 31, 2024 |  |  | June 30, 2024 |
(Dollars in millions) |  | Balance |  |  | % |  |  | Balance |  |  | % |  |  | Balance |  |  | % |
Loans in-school/grace/deferment(1) |  | $ | 1,280 |  |  |  |  |  | $ | 1,262 |  |  |  |  |  | $ | 1,403 |  |  |  |
Loans in forbearance(2) |  |  | 3,653 |  |  |  |  |  |  | 4,365 |  |  |  |  |  |  | 5,320 |  |  |  |
Loans in repayment and percentage of each status: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loans current |  |  | 20,145 |  |  |  | 81.0 | % |  |  | 20,675 |  |  |  | 81.4 | % |  |  | 22,833 |  |  |  | 86.5 | %
Loans delinquent 31-60 days(3) |  |  | 1,333 |  |  |  | 5.4 |  |  |  | 1,479 |  |  |  | 5.8 |  |  |  | 1,041 |  |  |  | 3.9 |
Loans delinquent 61-90 days(3) |  |  | 863 |  |  |  | 3.5 |  |  |  | 1,043 |  |  |  | 4.1 |  |  |  | 680 |  |  |  | 2.6 |
Loans delinquent greater than 90 days(3) |  |  | 2,526 |  |  |  | 10.1 |  |  |  | 2,208 |  |  |  | 8.7 |  |  |  | 1,857 |  |  |  | 7.0 |
Total FFELP Loans in repayment |  |  | 24,867 |  |  |  | 100 | % |  |  | 25,405 |  |  |  | 100 | % |  |  | 26,411 |  |  |  | 100 | %
Total FFELP Loans |  |  | 29,800 |  |  |  |  |  |  | 31,032 |  |  |  |  |  |  | 33,134 |  |  |  |
FFELP Loan allowance for losses |  |  | (182 | ) |  |  |  |  |  | (180 | ) |  |  |  |  |  | (194 | ) |  |  |
FFELP Loans, net |  | $ | 29,618 |  |  |  |  |  | $ | 30,852 |  |  |  |  |  | $ | 32,940 |  |  |  |
Percentage of FFELP Loans in repayment |  |  |  |  |  | 83.4 | % |  |  |  |  |  | 81.9 | % |  |  |  |  |  | 79.7 | %
Delinquencies as a percentage of FFELP Loans in repayment |  |  |  |  |  | 19.0 | % |  |  |  |  |  | 18.6 | % |  |  |  |  |  | 13.5 | %
FFELP Loans in forbearance as a percentage of loans in repayment and forbearance |  |  |  |  |  | 12.8 | % |  |  |  |  |  | 14.7 | % |  |  |  |  |  | 16.8 | %
(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 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. Loan type:
(Dollars in millions) |  | June 30, 2025 |  |  | June 30, 2024 |  |  | Change |
Stafford Loans |  | $ | 9,703 |  |  | $ | 10,589 |  |  | $ | (886 | )
Consolidation Loans |  |  | 17,077 |  |  |  | 19,273 |  |  |  | (2,196 | )
Rehab Loans |  |  | 3,020 |  |  |  | 3,272 |  |  |  | (252 | )
Total loans, gross |  | $ | 29,800 |  |  | $ | 33,134 |  |  | $ | (3,334 | )
2. Allowance for Loan Losses (Continued) Private Education Loans The key credit quality indicators are credit scores (FICO scores), loan status, loan seasoning, certain loan modifications, the existence of a cosigner and school type. The FICO score is the higher of the borrower or co-borrower score and is updated at least every six months while school type is assessed at origination. The other Private Education Loan key quality indicators are updated quarterly.
|  | Private Education Loan Credit Quality Indicators by Origination Year |
|  | June 30, 2025 |
(Dollars in millions) |  | 2025 |  |  | 2024 |  |  | 2023 |  |  | 2022 |  |  | 2021 |  |  | Prior |  |  | Total |  |  | % of Total |
Credit Quality Indicators |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
FICO Scores: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
640 and above |  | $ | 940 |  |  | $ | 1,146 |  |  | $ | 635 |  |  | $ | 1,167 |  |  | $ | 2,991 |  |  | $ | 7,020 |  |  | $ | 13,899 |  |  |  | 88 | %
Below 640 |  |  | 14 |  |  |  | 48 |  |  |  | 46 |  |  |  | 102 |  |  |  | 166 |  |  |  | 1,603 |  |  |  | 1,979 |  |  |  | 12 |
Total |  | $ | 954 |  |  | $ | 1,194 |  |  | $ | 681 |  |  | $ | 1,269 |  |  | $ | 3,157 |  |  | $ | 8,623 |  |  | $ | 15,878 |  |  |  | 100 | %
Loan Status: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
In-school/grace/ deferment/forbearance |  | $ | 29 |  |  | $ | 91 |  |  | $ | 55 |  |  | $ | 51 |  |  | $ | 73 |  |  | $ | 312 |  |  | $ | 611 |  |  |  | 4 | %
Current/90 days or less delinquent |  |  | 924 |  |  |  | 1,097 |  |  |  | 618 |  |  |  | 1,201 |  |  |  | 3,063 |  |  |  | 7,905 |  |  |  | 14,808 |  |  |  | 93 |
Greater than 90 days delinquent |  |  | 1 |  |  |  | 6 |  |  |  | 8 |  |  |  | 17 |  |  |  | 21 |  |  |  | 406 |  |  |  | 459 |  |  |  | 3 |
Total |  | $ | 954 |  |  | $ | 1,194 |  |  | $ | 681 |  |  | $ | 1,269 |  |  | $ | 3,157 |  |  | $ | 8,623 |  |  | $ | 15,878 |  |  |  | 100 | %
Seasoning(1): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
1-12 payments |  | $ | 932 |  |  | $ | 879 |  |  | $ | 28 |  |  | $ | 22 |  |  | $ | 11 |  |  | $ | 30 |  |  | $ | 1,902 |  |  |  | 12 | %
13-24 payments |  |  | — |  |  |  | 238 |  |  |  | 484 |  |  |  | 48 |  |  |  | 37 |  |  |  | 41 |  |  |  | 848 |  |  |  | 6 |
25-36 payments |  |  | — |  |  |  | — |  |  |  | 125 |  |  |  | 524 |  |  |  | 107 |  |  |  | 85 |  |  |  | 841 |  |  |  | 5 |
37-48 payments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 645 |  |  |  | 2,182 |  |  |  | 160 |  |  |  | 2,987 |  |  |  | 19 |
More than 48 payments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 784 |  |  |  | 8,155 |  |  |  | 8,939 |  |  |  | 56 |
Loans in-school/ grace/deferment |  |  | 22 |  |  |  | 77 |  |  |  | 44 |  |  |  | 30 |  |  |  | 36 |  |  |  | 152 |  |  |  | 361 |  |  |  | 2 |
Total |  | $ | 954 |  |  | $ | 1,194 |  |  | $ | 681 |  |  | $ | 1,269 |  |  | $ | 3,157 |  |  | $ | 8,623 |  |  | $ | 15,878 |  |  |  | 100 | %
Certain Loan Modifications(2): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Modified |  | $ | — |  |  | $ | 6 |  |  | $ | 27 |  |  | $ | 98 |  |  | $ | 203 |  |  | $ | 5,077 |  |  | $ | 5,411 |  |  |  | 34 | %
Non-Modified |  |  | 954 |  |  |  | 1,188 |  |  |  | 654 |  |  |  | 1,171 |  |  |  | 2,954 |  |  |  | 3,546 |  |  |  | 10,467 |  |  |  | 66 |
Total |  | $ | 954 |  |  | $ | 1,194 |  |  | $ | 681 |  |  | $ | 1,269 |  |  | $ | 3,157 |  |  | $ | 8,623 |  |  | $ | 15,878 |  |  |  | 100 | %
Cosigners: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
With cosigner(3) |  | $ | 152 |  |  | $ | 342 |  |  | $ | 225 |  |  | $ | 136 |  |  | $ | 70 |  |  | $ | 4,179 |  |  | $ | 5,104 |  |  |  | 32 | %
Without cosigner |  |  | 802 |  |  |  | 852 |  |  |  | 456 |  |  |  | 1,133 |  |  |  | 3,087 |  |  |  | 4,444 |  |  |  | 10,774 |  |  |  | 68 |
Total |  | $ | 954 |  |  | $ | 1,194 |  |  | $ | 681 |  |  | $ | 1,269 |  |  | $ | 3,157 |  |  | $ | 8,623 |  |  | $ | 15,878 |  |  |  | 100 | %
School Type: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Not-for-profit |  | $ | 893 |  |  | $ | 1,127 |  |  | $ | 643 |  |  | $ | 1,201 |  |  | $ | 2,971 |  |  | $ | 7,489 |  |  | $ | 14,324 |  |  |  | 90 | %
For-profit |  |  | 61 |  |  |  | 67 |  |  |  | 38 |  |  |  | 68 |  |  |  | 186 |  |  |  | 1,134 |  |  |  | 1,554 |  |  |  | 10 |
Total |  | $ | 954 |  |  | $ | 1,194 |  |  | $ | 681 |  |  | $ | 1,269 |  |  | $ | 3,157 |  |  | $ | 8,623 |  |  | $ | 15,878 |  |  |  | 100 | %
Allowance for loan losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (348 | ) |  |  |
Total loans, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 15,530 |  |  |  |
Charge-Offs |  | $ | — |  |  | $ | (2 | ) |  | $ | (3 | ) |  | $ | (6 | ) |  | $ | (12 | ) |  | $ | (129 | ) |  | $ | (152 | ) |  |  |
(1) Number of months in active repayment for which a scheduled payment was received. (2) Loan Modifications represents the historical definition of a troubled debt restructuring (TDR) prior to the implementation of ASU No. 2022-02 on January 1, 2023. Any loan that meets the historical definition of a TDR retains that classification for the life of the loan (including loans that met that definition after January 1, 2023). This includes loans given rate modifications, term extensions or forbearance greater than 3 months in the prior 24-month period. This classification is not intended to reconcile in any way to the modification disclosures required under ASU No. 2022-02. (3) Excluding Private Education Refinance Loans, which do not have a cosigner, the cosigner rate was 66% for total loans at June 30, 2025. 2. Allowance for Loan Losses (Continued)
|  | Private Education Loan Credit Quality Indicators by Origination Year |
|  | June 30, 2024 |
(Dollars in millions) |  | 2024 |  |  | 2023 |  |  | 2022 |  |  | 2021 |  |  | 2020 |  |  | Prior |  |  | Total |  |  | % of Total |
Credit Quality Indicators |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
FICO Scores: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
640 and above |  | $ | 490 |  |  | $ | 841 |  |  | $ | 1,453 |  |  | $ | 3,591 |  |  | $ | 1,119 |  |  | $ | 7,513 |  |  | $ | 15,007 |  |  |  | 90 | %
Below 640 |  |  | 8 |  |  |  | 20 |  |  |  | 75 |  |  |  | 137 |  |  |  | 31 |  |  |  | 1,453 |  |  |  | 1,724 |  |  |  | 10 |
Total |  | $ | 498 |  |  | $ | 861 |  |  | $ | 1,528 |  |  | $ | 3,728 |  |  | $ | 1,150 |  |  | $ | 8,966 |  |  | $ | 16,731 |  |  |  | 100 | %
Loan Status: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
In-school/grace/ deferment/forbearance |  | $ | 22 |  |  | $ | 69 |  |  | $ | 64 |  |  | $ | 80 |  |  | $ | 19 |  |  | $ | 390 |  |  | $ | 644 |  |  |  | 4 | %
Current/90 days or less delinquent |  |  | 476 |  |  |  | 789 |  |  |  | 1,454 |  |  |  | 3,634 |  |  |  | 1,127 |  |  |  | 8,256 |  |  |  | 15,736 |  |  |  | 94 |
Greater than 90 days delinquent |  |  | — |  |  |  | 3 |  |  |  | 10 |  |  |  | 14 |  |  |  | 4 |  |  |  | 320 |  |  |  | 351 |  |  |  | 2 |
Total |  | $ | 498 |  |  | $ | 861 |  |  | $ | 1,528 |  |  | $ | 3,728 |  |  | $ | 1,150 |  |  | $ | 8,966 |  |  | $ | 16,731 |  |  |  | 100 | %
Seasoning(1): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
1-12 payments |  | $ | 479 |  |  | $ | 632 |  |  | $ | 36 |  |  | $ | 24 |  |  | $ | 3 |  |  | $ | 45 |  |  | $ | 1,219 |  |  |  | 7 | %
13-24 payments |  |  | — |  |  |  | 172 |  |  |  | 656 |  |  |  | 82 |  |  |  | 11 |  |  |  | 61 |  |  |  | 982 |  |  |  | 6 |
25-36 payments |  |  | — |  |  |  | — |  |  |  | 791 |  |  |  | 2,602 |  |  |  | 28 |  |  |  | 111 |  |  |  | 3,532 |  |  |  | 21 |
37-48 payments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 976 |  |  |  | 683 |  |  |  | 206 |  |  |  | 1,865 |  |  |  | 11 |
More than 48 payments |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 416 |  |  |  | 8,367 |  |  |  | 8,783 |  |  |  | 53 |
Loans in-school/ grace/deferment |  |  | 19 |  |  |  | 57 |  |  |  | 45 |  |  |  | 44 |  |  |  | 9 |  |  |  | 176 |  |  |  | 350 |  |  |  | 2 |
Total |  | $ | 498 |  |  | $ | 861 |  |  | $ | 1,528 |  |  | $ | 3,728 |  |  | $ | 1,150 |  |  | $ | 8,966 |  |  | $ | 16,731 |  |  |  | 100 | %
Certain Loan Modifications(2): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Modified |  | $ | — |  |  | $ | 3 |  |  | $ | 64 |  |  | $ | 161 |  |  | $ | 53 |  |  | $ | 5,538 |  |  | $ | 5,819 |  |  |  | 35 | %
Non-Modified |  |  | 498 |  |  |  | 858 |  |  |  | 1,464 |  |  |  | 3,567 |  |  |  | 1,097 |  |  |  | 3,428 |  |  |  | 10,912 |  |  |  | 65 |
Total |  | $ | 498 |  |  | $ | 861 |  |  | $ | 1,528 |  |  | $ | 3,728 |  |  | $ | 1,150 |  |  | $ | 8,966 |  |  | $ | 16,731 |  |  |  | 100 | %
Cosigners: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
With cosigner(3) |  | $ | 76 |  |  | $ | 264 |  |  | $ | 168 |  |  | $ | 87 |  |  | $ | 21 |  |  | $ | 4,808 |  |  | $ | 5,424 |  |  |  | 32 | %
Without cosigner |  |  | 422 |  |  |  | 597 |  |  |  | 1,360 |  |  |  | 3,641 |  |  |  | 1,129 |  |  |  | 4,158 |  |  |  | 11,307 |  |  |  | 68 |
Total |  | $ | 498 |  |  | $ | 861 |  |  | $ | 1,528 |  |  | $ | 3,728 |  |  | $ | 1,150 |  |  | $ | 8,966 |  |  | $ | 16,731 |  |  |  | 100 | %
School Type: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Not-for-profit |  | $ | 335 |  |  | $ | 814 |  |  | $ | 1,447 |  |  | $ | 3,511 |  |  | $ | 1,099 |  |  | $ | 7,674 |  |  | $ | 14,880 |  |  |  | 89 | %
For-profit |  |  | 163 |  |  |  | 47 |  |  |  | 81 |  |  |  | 217 |  |  |  | 51 |  |  |  | 1,292 |  |  |  | 1,851 |  |  |  | 11 |
Total |  | $ | 498 |  |  | $ | 861 |  |  | $ | 1,528 |  |  | $ | 3,728 |  |  | $ | 1,150 |  |  | $ | 8,966 |  |  | $ | 16,731 |  |  |  | 100 | %
Allowance for loan losses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (493 | ) |  |  |
Total loans, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 16,238 |  |  |  |
Charge-Offs |  | $ | — |  |  | $ | (1 | ) |  | $ | (5 | ) |  | $ | (9 | ) |  | $ | (2 | ) |  | $ | (149 | ) |  | $ | (166 | ) |  |  |
(1) Number of months in active repayment for which a scheduled payment was received. (2) Loan Modifications represents the historical definition of a troubled debt restructuring (TDR) prior to the implementation of ASU 2022-02 on January 1, 2023. Any loan that meets the historical definition of a TDR retains that classification for the life of the loan (including loans that met that definition after January 1, 2023). This includes loans given rate modifications, term extensions or forbearance greater than 3 months in the prior 24-month period. This classification is not intended to reconcile in any way to the new modification disclosures required under ASU 2022-02. (3) Excluding Private Education Refinance Loans, which do not have a cosigner, the cosigner rate was 66% for total loans at June 30, 2024. 2. Allowance for Loan Losses (Continued)
|  | Private Education Loan Delinquencies |
|  | June 30, 2025 |  |  | December 31, 2024 |  |  | June 30, 2024 |
(Dollars in millions) |  | Balance |  |  | % |  |  | Balance |  |  | % |  |  | Balance |  |  | % |
Loans in-school/grace/deferment(1) |  | $ | 361 |  |  |  |  |  | $ | 372 |  |  |  |  |  | $ | 350 |  |  |  |
Loans in forbearance(2) |  |  | 250 |  |  |  |  |  |  | 422 |  |  |  |  |  |  | 294 |  |  |  |
Loans in repayment and percentage of each status: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loans current |  |  | 14,296 |  |  |  | 93.6 | % |  |  | 14,419 |  |  |  | 93.9 | % |  |  | 15,250 |  |  |  | 94.8 | %
Loans delinquent 31-60 days(3) |  |  | 335 |  |  |  | 2.2 |  |  |  | 319 |  |  |  | 2.1 |  |  |  | 311 |  |  |  | 1.9 |
Loans delinquent 61-90 days(3) |  |  | 177 |  |  |  | 1.2 |  |  |  | 206 |  |  |  | 1.3 |  |  |  | 175 |  |  |  | 1.1 |
Loans delinquent greater than 90 days(3) |  |  | 459 |  |  |  | 3.0 |  |  |  | 419 |  |  |  | 2.7 |  |  |  | 351 |  |  |  | 2.2 |
Total loans in repayment |  |  | 15,267 |  |  |  | 100 | % |  |  | 15,363 |  |  |  | 100 | % |  |  | 16,087 |  |  |  | 100 | %
Total loans |  |  | 15,878 |  |  |  |  |  |  | 16,157 |  |  |  |  |  |  | 16,731 |  |  |  |
Allowance for losses |  |  | (348 | ) |  |  |  |  |  | (441 | ) |  |  |  |  |  | (493 | ) |  |  |
Loans, net |  | $ | 15,530 |  |  |  |  |  | $ | 15,716 |  |  |  |  |  | $ | 16,238 |  |  |  |
Percentage of loans in repayment |  |  |  |  |  | 96.2 | % |  |  |  |  |  | 95.1 | % |  |  |  |  |  | 96.2 | %
Delinquencies as a percentage of loans in repayment |  |  |  |  |  | 6.4 | % |  |  |  |  |  | 6.1 | % |  |  |  |  |  | 5.2 | %
Loans in forbearance as a percentage of loans in repayment and forbearance |  |  |  |  |  | 1.6 | % |  |  |  |  |  | 2.7 | % |  |  |  |  |  | 1.8 | %
(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., internship periods, as well as 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. Loan Modifications to Borrowers Experiencing Financial Difficulty We adjust the terms of Private Education Loans for certain borrowers when we believe such changes will help our customers better manage their student loan obligations, achieve better outcomes and increase the collectability of the loans. These changes generally take the form of a temporary interest rate reduction, a temporary forbearance of payments, a temporary interest-only payment, and a temporary interest rate reduction with a permanent extension of the loan term. The effect of modifications of loans made to borrowers who are experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance. The model design predicts borrowers that will have financial difficulty in the future and require loan modification and increased life of loan default risk. Under our current forbearance practices, temporary hardship forbearance of payments generally cannot exceed 12 months over the life of the loan. However, exceptions can be made in cases where borrowers have shown the ability to make a substantial number of monthly principal and interest payments and in those cases borrowers can be granted up to 24 months of hardship forbearance over the life of the loan. We offer other administrative forbearances (e.g., death and disability, bankruptcy, military service, and disaster forbearance) that are either required by law (such as the Servicemembers Civil Relief Act) or are considered separate from our active loss mitigation programs and therefore are not considered to be loan modifications requiring disclosure under ASU No. 2022-02. FFELP Loans are at least 97 percent guaranteed as to their principal and accrued interest by the federal government in the event of default and, therefore, we do not deem FFELP Loans as nonperforming from a credit risk perspective at any point in their life cycle prior to claim payment and continue to accrue interest on those loans through the date of claim. Further, FFELP loan modification events are either legal entitlements subject to regulatory-driven eligibility criteria or addressed in the promissory note terms, so we do not consider these events as a component of our loan modification programs. 2. Allowance for Loan Losses (Continued) The following tables show the amortized cost basis as of June 30, 2025 and 2024 of the loans to borrowers experiencing financial difficulty that were modified during the respective period.
|  | Three Months Ended June 30, 2025 |
|  | Loan Modifications Made to Borrowers Experiencing Financial Difficulty |
(Dollars in millions) |  | Interest Rate Reductions(1) |  |  | More Than an Insignificant Payment Delay (2) |  |  | Combination Rate Reduction and Term Extension |
Loan Type |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |
Private Education Loans |  | $ | 568 |  |  |  | 3.6 | % |  | $ | 295 |  |  |  | 1.9 | % |  | $ | 35 |  |  |  | .2 | %
|  | Three Months Ended June 30, 2024 |
|  | Loan Modifications Made to Borrowers Experiencing Financial Difficulty |
(Dollars in millions) |  | Interest Rate Reductions(1) |  |  | More Than an Insignificant Payment Delay (2) |  |  | Combination Rate Reduction and Term Extension |
Loan Type |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |
Private Education Loans |  | $ | 601 |  |  |  | 3.6 | % |  | $ | 314 |  |  |  | 1.9 | % |  | $ | 39 |  |  |  | .2 | %
|  | Six Months Ended June 30, 2025 |
(Dollars in millions) |  | Interest Rate Reductions(1) |  |  | More Than an Insignificant Payment Delay (2) |  |  | Combination Rate Reduction and Term Extension |
Loan Type |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |
Private Education Loans |  | $ | 1,171 |  |  |  | 7.4 | % |  | $ | 548 |  |  |  | 3.5 | % |  | $ | 75 |  |  |  | .5 | %
|  | Six Months Ended June 30, 2024 |
(Dollars in millions) |  | Interest Rate Reductions(1) |  |  | More Than an Insignificant Payment Delay (2) |  |  | Combination Rate Reduction and Term Extension |
Loan Type |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |  |  | Amortized Cost |  |  | % of Loan Type |
Private Education Loans |  | $ | 1,143 |  |  |  | 6.8 | % |  | $ | 597 |  |  |  | 3.6 | % |  | $ | 78 |  |  |  | .5 | %
(1) As of June 30, 2025 and 2024, there was $1.0 billion and $1.1 billion, respectively, of loans in the interest rate reduction program. (2) More Than an Insignificant Payment Delay includes loans granted more than 3 months of short-term interest only payments or hardship forbearance. 2. Allowance for Loan Losses (Continued) For those loans modified in the three and six months ended June 30, 2025 and 2024, the following tables show the impact of such modification.
Three Months Ended June 30, 2025
Loan Type | Interest Rate Reductions | More Than an Insignificant Payment Delay | Combination Rate Reduction and Term Extension
Private Education Loans | Reduced the weighted average contractual rate from 12.3% to 5.3% | Added an average 5 months to the remaining life of the loans | Added an average 7 years to the remaining life of the loans and reduced the weighted average contractual rate from 12.1% to 5.4%.
Three Months Ended June 30, 2024
Loan Type | Interest Rate Reductions | More Than an Insignificant Payment Delay | Combination Rate Reduction and Term Extension
Private Education Loans | Reduced the weighted average contractual rate from 13.3% to 5.5% | Added an average 5 months to the remaining life of the loans | Added an average 7 years to the remaining life of the loans and reduced the weighted average contractual rate from 12.7% to 5.3%.
Six Months Ended June 30, 2025
Loan Type | Interest Rate Reductions | More Than an Insignificant Payment Delay | Combination Rate Reduction and Term Extension
Private Education Loans | Reduced the weighted average contractual rate from 12.4% to 5.4% | Added an average 7 months to the remaining life of the loans | Added an average 7 years to the remaining life of the loans and reduced the weighted average contractual rate from 12.0% to 5.4%.
Six Months Ended June 30, 2024
Loan Type | Interest Rate Reductions | More Than an Insignificant Payment Delay | Combination Rate Reduction and Term Extension
Private Education Loans | Reduced the weighted average contractual rate from 13.3% to 5.5% | Added an average 6 months to the remaining life of the loans | Added an average 7 years to the remaining life of the loans and reduced the weighted average contractual rate from 12.8% to 5.3%.
2. Allowance for Loan Losses (Continued) The following table provides the amount of loan modifications for which a charge-off or payment default occurred in the respective period and within 12 months of the loan receiving a loan modification. We define payment default as 60 days or more past due for purposes of this disclosure. We closely monitor performance of the loans to borrowers experiencing financial difficulty that are modified to understand the effectiveness of the modification efforts.
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
(Dollars in millions) |  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Modified loans (amortized cost) (1) |  | $ | 109 |  |  | $ | 128 |  |  | $ | 179 |  |  | $ | 163 |
Payment default (par) |  | $ | 111 |  |  | $ | 131 |  |  | $ | 183 |  |  | $ | 167 |
Charge-offs (par) |  | $ | 15 |  |  | $ | 10 |  |  | $ | 25 |  |  | $ | 12 |
(1) For the three months ended June 30, 2025 and 2024, the modified loans include $71 million and $101 million, respectively, of Interest Rate Reduction, $5 million and $5 million, respectively, of Combination Rate Reduction and Term Extension, and $33 million and $22 million, respectively, of More Than Insignificant Payment Delay. For the six months ended June 30, 2025 and 2024, the modified loans include $119 million and $121 million, respectively, of Interest Rate Reduction, $8 million and $7 million, respectively, of Combination Rate Reduction and Term Extension, and $52 million and $35 million, respectively, of More Than Insignificant Payment Delay. The following table provides the performance and related loan status of Private Education Loans that have been modified within the 12 months prior to June 30, 2025 and the 12 months prior to December 31, 2024, respectively.
|  | Payment Status (Amortized Cost) |
(Dollars in millions) |  | Twelve Months Ended |
Loan Status |  | June 30, 2025 |  |  | December 31, 2024 |
Loans in school/deferment |  | $ | 20 |  |  | $ | 21 |
Loans in forbearance |  |  | 78 |  |  |  | 162 |
Loans current |  |  | 2,111 |  |  |  | 2,037 |
Loans delinquent 31 - 60 days |  |  | 181 |  |  |  | 172 |
Loans delinquent 61 - 90 days |  |  | 100 |  |  |  | 117 |
Loans delinquent greater than 90 days |  |  | 164 |  |  |  | 186 |
Total modified loans |  | $ | 2,654 |  |  | $ | 2,695 |

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