Sallie Mae 2005 Annual Report Download - page 160
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SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollars in thousands, except per share amounts, unless otherwise stated)
F-38
9. Student Loan Securitization (Continued)
Key economic assumptions used in estimating the fair value of the Residual Interests at the date of
securitization resulting from the student loan securitization sale transactions completed during the years
ended December 31, 2005 and 2004 were as follows:
Years ended December 31,
2005 2004
FFELP
Stafford Consolidation
Private
Education
FFELP
Stafford Consolidation(1)
Private
Education
Prepaymentspeed............. * 6% 3% ** — 6%
Weighted-average life.......... 3.8 yrs 7.9 yrs. 8.9 yrs. 4.2 yrs. — 7.2 yrs.
Expected credit losses
(% of principal securitized). . . — —% 4.41% .12% — 4.72%
Residual cash flows discounted at
(weighted average).......... 12.2 % 10.1% 12.3% 12% — 12.1%
(1) No securitizations in the period, or such securitizations did not qualify for sale treatment.
*Securitizations through August 2005 used a Constant Prepayment Rate (“CPR”) of 20 percent for 2005,
15 percent for 2006, and 6 percent thereafter. Securitizations from September 2005 through December 2005 used
a CPR of 30 percent for 2005, 20 percent in 2006, 15 percent for 2007 and 10 percent thereafter.
** Securitizations through August 2004 used a CPR of 20 percent for 2004, 15 percent for 2005, and 6 percent
thereafter. Securitizations from September 2004 through December 2004 used a CPR of 20 percent for 2004
through 2005, 15 percent for 2006 and 6 percent thereafter.
The following table summarizes cash flows received from or paid to the off-balance sheet
securitization trusts during the years ended December 31, 2005, 2004 and 2003:
Years ended December 31,
(Dollars in millions) 2005 2004 2003
Net proceeds from new securitizations completed during the period .... $13,523 $12,476 $13,483
Purchases of delinquent Private Education Loans from
securitization trusts............................................. (63) (33) (6)
Servicing fees received(1) .......................................... 320 319 298
Cash distributions from trusts related to Residual Interests............ 630 844 870
(1) The Company receives annual servicing fees of 90 basis points, 50 basis points and 70 basis points of the
outstanding securitized loan balance related to its FFELP Stafford, Consolidation Loan and Private Education
Loan securitizations, respectively.