SLM Corporation, commonly known as Sallie Mae, reported its financial results for the second quarter and first half of 2026, revealing a decline in both net income and total assets compared to the previous year. For the three months ended June 30, 2026, the company recorded a net income of $58.5 million, or $0.29 per diluted share, down from $71.3 million, or $0.32 per diluted share, in the same period of 2025. For the first half of 2026, net income was $366.5 million, compared to $375.8 million in the prior year. Total assets decreased to $28.6 billion from $29.7 billion at the end of 2025, primarily due to a reduction in loans held for investment.
The company experienced a significant decrease in net interest income, which fell to $332.8 million in the second quarter, down from $376.8 million a year earlier. This decline was attributed to a $1.4 billion decrease in average Private Education Loans outstanding and a shift towards lower-yielding cash and short-term investments. The net interest margin also contracted, reflecting a decrease in yields on interest-earning assets that outpaced the reduction in funding costs. The provision for credit losses was $125.7 million for the quarter, a decrease from $148.7 million in the prior year, largely due to negative provisions resulting from loan sales.
In terms of operational metrics, SLM's Private Education Loans held for investment totaled $19.5 billion as of June 30, 2026, down from $20.3 billion at the end of 2025. The company reported a total of $1.7 billion in outstanding contractual loan commitments expected to be funded during the 2026/2027 academic year. The allowance for credit losses stood at $1.4 billion, reflecting a coverage ratio of 5.89% of total Private Education Loan exposure. The company also noted an increase in delinquencies, with 3.7% of loans in repayment classified as delinquent, up from 3.5% a year earlier.
Strategically, SLM has focused on enhancing its product offerings and expanding its market presence. The company completed a $420 million Private Education Loan sale during the second quarter, which contributed to its non-interest income. Additionally, SLM has been actively managing its capital structure, with a recent share repurchase program allowing for the buyback of up to $500 million in common stock. The company declared dividends of $0.13 per share in both June 2026 and June 2025, indicating a commitment to returning value to shareholders.
Looking ahead, SLM Corporation remains focused on driving innovation and growth in its core private student loan business while navigating the challenges posed by changing market conditions. The company anticipates continued fluctuations in interest rates and credit quality, which may impact its financial performance in the coming quarters.
About SLM Corp
SLM Corporation, known as Sallie Mae, is a leading provider of private student loans, offering origination and servicing for high-quality education financing. It serves students and families nationwide, primarily funding higher education costs through private loans, deposit products, and market-based funding. The company emphasizes responsible lending, customer support, and digital engagement, supporting access to higher education and fostering financial responsibility.
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